Purdue: As Ransomware Attacks Increase, New Algorithm May Help Prevent Power Blackouts

Gulf Power renewable energy contract underscores a Florida PSC-approved power purchase from Bay County's municipal solid waste plant, delivering 13.65 MW at a fixed price, boosting fuel diversity, lowering landfill waste, and saving customers money.

Key Points

A fixed-price PPA for 13.65 MW from Bay County's waste-to-energy plant, approved by Florida PSC to cut costs.

✅ Fixed-price purchase; pay only for energy produced.

✅ 13.65 MW from Bay County waste-to-energy facility.

✅ Cuts landfill waste and natural gas dependency.

The Florida Public Service Commission (PSC) approved Tuesday a contract under which Gulf Power Company will purchase all the electricity generated by the Bay County Resource Recovery Facility, a municipal solid waste plant, similar to SaskPower-Manitoba Hydro deal structures seen elsewhere, over the next six years.

“Gulf’s renewable energy purchase promotes Florida’s fuel diversity, further reducing our dependency on natural gas,” PSC Chairperson Julie Brown said. “This renewable energy option also reduces landfill waste, saves customers money, and serves the public interest.”

The contract provides for Gulf to acquire the Panama City facility’s 13.65 megawatts of renewable generation for its customers beginning in July 2017. Gulf will pay a fixed price, aligned with approaches in Alberta's clean electricity RFP programs, and only pays for the energy produced. The contract is expected to save approximately $250,000 and provides security for customers, a contrast to overruns at the Kemper power plant project, because if the plant does not supply energy, Gulf does not have to provide payment.

This contract is the third renewable energy contract between Gulf and Bay County, at a time when the Southern California plant closures may be postponed, continuing agreements approved in 2008 and 2014. In making the decision, the PSC considered Gulf’s need for power and developments such as the Turkey Point license renewal process, as well as the contract’s cost-effectiveness, payment provisions, and performance guarantees, as required by rule.

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BC Tidal Energy Micro-Grids harness predictable tidal currents to replace diesel in remote Indigenous coastal communities, integrating marine renewables, storage, and demand management for resilient off-grid power along Vancouver Island and Haida Gwaii.

Key Points

Community-run tidal turbines and storage deliver reliable, diesel-free electricity to remote B.C. coastal communities.

✅ Predictable power from tidal currents reduces diesel dependence

✅ Integrates storage, demand management, and microgrid controls

✅ Local jobs via marine supply chains and community ownership

Many remote West Coast communities are reliant on diesel for electricity generation, which poses a number of negative economic and environmental effects.

But some sites along B.C.’s extensive coastline are ideal for tidal energy micro-grids that may well be the answer for off-grid communities to generate clean power, suggested experts at a COAST (Centre for Ocean Applied Sustainable Technologies) virtual event Wednesday.

There are 40 isolated coastal communities, many Indigenous communities, and 32 of them are primarily reliant on diesel for electricity generation, said Ben Whitby, program manager at PRIMED, a marine renewable energy research lab at the University of Victoria (UVic).

Besides being a costly and unreliable source of energy, there are environmental and community health considerations associated with shipping diesel to remote communities and running generators, Whitby said.

“It's not purely an economic question,” he said.

“You've got the emissions associated with diesel generation. There's also the risks of transporting diesel … and sometimes in a lot of remote communities on Vancouver Island, when deliveries of diesel don't come through, they end up with no power for three or four days at a time.”

The Heiltsuk First Nation, which suffered a 110,000-litre diesel spill in its territorial waters in 2016, is an unfortunate case study for the potential environmental, social, and cultural risks remote coastal communities face from the transport of fossil fuels along the rough shoreline.

A U.S. barge hauling fuel for coastal communities in Alaska ran aground in Gale Pass, fouling a sacred and primary Heiltsuk food-harvesting area.

There are a number of potential tidal energy sites near off-grid communities along the mainland, on both sides of Vancouver Island, and in the Haida Gwaii region, Whitby said.

Tidal energy exploits the natural ebb and flow of the coast’s tidal water using technologies like underwater kite turbines to capture currents, and is a highly predictable source of renewable energy, he said.

Micro-grids are self-reliant energy systems drawing on renewables from ocean, wave power resources, wind, solar, small hydro, and geothermal sources.

The community, rather than a public utility like BC Hydro, is responsible for demand management, storage, and generation with the power systems running independently or alongside backup fuel generators — offering the operators a measure of energy sovereignty.

Depending on proximity, cost, and renewable solutions, tidal energy isn’t necessarily the solution for every community, Whitby noted, adding that in comparison to hydro, tidal energy is still more expensive.

However, the best candidates for tidal energy are small, off-grid communities largely dependent on costly fossil fuels, Whitby said.

“That's really why the focus in B.C. is at a smaller scale,” he said.

“The time it would take (these communities) to recoup any capital investment is a lot shorter.

“And the cost is actually on a par because they're already paying a significant amount of money for that diesel-generated power.”

Lisa Kalynchuk, vice-president of research and innovation at UVic, said she was excited by the possibilities associated with tidal power, not only in B.C., but for all of Canada’s coasts.

“Canada has approximately 40,000 megawatts available on our three coastlines,” Kalynchuk said.

“Of course, not all this power can be realized, but it does exist, so that leads us to the hard part — tapping into this available energy and delivering it to those remote communities that need it.”

Challenges to establishing tidal power include the added cost and complexity of construction in remote communities, the storage of intermittent power for later use, the economic model, though B.C.’s streamlined regulatory process may ease approvals, the costs associated with tidal power installations, and financing for small communities, she said.

But smaller tidal energy projects can potentially set a track record for more nascent marine renewables, as groups like Marine Renewables Canada pivot to offshore wind development, at a lower cost and without facing the same social or regulatory resistance a large-scale project might face.

A successful tidal energy demo project was set up using a MAVI tidal turbine in Blind Channel to power a private resort on West Thurlow Island, part of the outer Discovery Islands chain wedged between Vancouver Island and the mainland, Whitby said.

The channel’s strong tidal currents, which routinely reach six knots and are close to the marina, proved a good site to test the small-scale turbine and associated micro-grid system that could be replicated to power remote communities, he said.

The mooring system, cable, and turbine were installed fairly rapidly and ran through the summer of 2017. The system is no longer active as provincial and federal funding for the project came to an end.

“But as a proof of concept, we think it was very successful,” Whitby said, adding micro-grid tidal power is still in the early stages of development.

Ideally, the project will be revived with new funding, so it can continue to act as a test site for marine renewable energy and to showcase the system to remote coastal communities that might want to consider tidal power, he said.

In addition to harnessing a local, renewable energy source and increasing energy independence, tidal energy micro-grids can fuel employment and new business opportunities, said Whitby.

The Blind Channel project was installed using the local supply chain out of nearby Campbell River, he said.

“Most of the vessels and support came from that area, so it was all really locally sourced.”

Funding from senior levels of government would likely need to be provided to set up a permanent tidal energy demonstration site, with recent tidal energy investments in Nova Scotia offering a model, or to help a community do case studies and finance a project, Whitby said.

Both the federal and provincial governments have established funding streams to transition remote communities away from relying on diesel.

But remote community projects funded federally or provincially to date have focused on more established renewables, such as hydro, solar, biomass, or wind.

The goal of B.C.’s Remote Community Energy Strategy, part of the CleanBC plan and aligned with zero-emissions electricity by 2035 targets across Canada, is to reduce diesel use for electricity 80 per cent by 2030 by targeting 22 of the largest diesel locations in the province, many of which fall along the coast.

The province has announced a number of significant investments to shift Indigenous coastal communities away from diesel-generated electricity, but they predominantly involve solar or hydro projects.

A situation that’s not likely to change, as the funding application guide in 2020 deemed tidal projects as ineligible for cash.

Yet, the potential for establishing tidal energy micro-grids in B.C. is good, Kalynchuk said, noting UVic is a hub for significant research expertise and several local companies, including ocean and river power innovators working in the region, are employing and developing related service technologies to install and maintain the systems.

“It also addresses our growing need to find alternative sources of energy in the face of the current climate crisis,” she said.

“The path forward is complex and layered, but one essential component in combating climate change is a move away from fossil fuels to other sources of energy that are renewable and environmentally friendly.”

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COVID-19 Impact on US Renewable Energy disrupts solar and wind projects, dries up tax equity financing, strains supply chains, delays construction, and slows jobs growth amid limited federal stimulus and uncertain investor appetite.

Key Points

COVID-19 has slowed US clean energy growth by curbing tax equity, disrupting supply chains, and delaying projects.

✅ Tax equity dries up as investor profits fall

✅ Supply chain and construction face pandemic delays

✅ Policy aid and credit extensions sought by industry

Swinerton Renewable Energy had everything it needed to build a promising new solar farm in Texas. It lined up more than 2,000 acres for the $109 million project estimated to generate 400 jobs while under construction. By its completion date, the solar farm was expected to produce 200 megawatts of energy — enough to power about 25,000 homes — and generate big tax breaks for its investors as part of a government program to incentivize clean energy.

But the coronavirus pandemic put everything on hold. The solar farm’s backers aren’t sure they will make enough money from other investments during the pandemic-fueled downturn for those tax breaks to be worth it. So the project has been delayed at least six months.

“This is not a shortage of materials. It is not a pricing issue,” said George Hershman, president of Swinerton Renewable Energy. “Everything was pointing to successful projects.”

The coronavirus crisis is not only battering the oil and gas industry. It’s drying up capital and disrupting supply chains for businesses trying to move the country toward cleaner sources of energy.

While President Trump has promised lifelines for airlines and oil companies struggling with a drastic decrease in demand as Americans remain under stay-at-home orders, there is little focus in Washington on economic relief for this sector, despite a power coalition's call for action to address the pandemic — unlike during the Great Recession a decade ago, when Congress and the Obama administration earmarked an unprecedented sum for renewable energy and more efficient automobiles in a stimulus bill.

“We don’t want to lose our great oil companies,” Trump said during an April 1 news briefing. He so far has not made a similar promise to help wind and solar firms, and none of the four economic rescue and stimulus packages that Congress has passed to respond to the coronavirus crisis set aside any money for renewable energy specifically.

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The impact of the crisis is already clear: About 106,000 clean-energy workers have already filed for unemployment in March alone, according to an analysis of Bureau of Labor Statistics data by Environmental Entrepreneurs, an advocacy group.

The layoffs are a blow to a sector that has prided itself on official projections that solar installers and wind turbine technicians would be the two fastest growing occupations over the next decade.

The job losses include not just wind and solar construction workers, but also those assembling electric cars and installing energy-efficient appliances, lighting, heating and air conditioning.

“These aren’t left-wing coastal hippies,” said Bob Keefe, executive director of Environmental Entrepreneurs. “These are construction workers who get up every day and lace up their boots and pull on their gloves and go to work putting insulation in our attics.”

Despite the economic turmoil, climate experts say the coronavirus pandemic could be an opportunity to make drastic shifts in the energy landscape, with green investments potentially driving a robust recovery. They say governments around the world should help fund renewable energy and use the turmoil in energy markets to remake the industry and slash carbon dioxide emissions, which will tumble 8 percent this year, according to the International Energy Agency.

The agency said that while global energy demand fell 3.8 percent in the first quarter, renewables were the only source to post an increase in demand, rising 1.5 percent thanks to new renewable power plants, low operating costs and priority on some electricity grids.

But many investors, who rely on a broad mix of investments, are spooked. “Everything is quiet because people want to see where we land with the current crisis, and people are holding on to cash,” said Daniel Klier, the global head of sustainable finance at HSBC bank. “As soon as people have a bit of confidence that the market is recovering, they can get projects going.”

Social distancing and the country’s stay-at-home orders are also having a deep effect on daily operations. The areas hardest hit are installing solar panels on rooftops and adding energy-efficiency measures inside homes — work that often requires face-to-face interactions. Sungevity, once one of the nation’s leading solar-installation companies, laid off 377 workers, most of its workforce, in late March, according to filings with California’s Employment Development Department. The company, which had emerged from a 2017 bankruptcy, cited economic conditions.

The push to promote a more fuel-efficient automobile fleet has also veered off track. The electric car maker Tesla was forced to shut down its factory in Fremont, Calif., just as it was turning up production on its new crossover vehicle, the Model Y.

Lockdown orders across the country led Tesla’s outspoken chief executive, Elon Musk, to launch into an expletive-laden rant during an earnings call last week in which Tesla posted a lukewarm profit of $16 million.

“To say that they cannot leave their house and they will be arrested if they do,” Musk said, “this is fascist.”

Sungevity and Tesla represent only a sliver of the economic pain in this sector across the country. The Solar Energy Industries Association had anticipated a growth in solar jobs, from 250,000 to 300,000, over the course of the year, said the group’s president, Abigail Ross Hopper. Now, she said, half the workforce is at risk.

“Shelter in place puts limitations on how people can work,” she said. “Literally, people don’t want other people inside their houses to fix electrical boxes. And there are no door-to-door sales.”

Bigger projects are also grappling with the pandemic economy, though not as severely. Hopper said the industry was geared up to increase the number of new solar farms, in part to take advantage of federal tax credits. “We were on track to do almost 20 gigawatts, which would have been the highest year yet,” Hopper said. That would have been enough to power about 3.7 million homes. Now she expects new projects will come closer to last year’s 13.27 gigawatts’ worth of new construction, after a report on utility-scale solar delays warned of widespread slowdowns, enough to run approximately 2.5 million homes.

Wind energy companies, too, are bracing for lost progress unless the federal government steps in. The American Wind Energy Association said projects that would add 25 gigawatts of wind power to the U.S. grid are at risk of being scaled back or canceled outright over the next two years because of the pandemic. Altogether, that work represents about 35,000 jobs.

“2019 was a good year for the wind industry,” said Tom Kiernan, the association’s chief executive. “We were expecting 2020 to be an even stronger year.”

One project put on the back burner: an enormous 9 gigawatt offshore wind venture led by the New York State Energy Research and Development Authority set to be completed by 2035.

With New York City besieged by coronavirus cases, the authority said it would comply with an executive order from Gov. Andrew M. Cuomo (D), “pausing” all on-site work on clean-energy projects until at least May 15. Michigan, New Jersey and Pennsylvania also delayed wind turbine projects by deeming construction on them nonessential.

The Danish offshore wind firm Orsted said that plans for offshore U.S. wind installations would move “at a slower pace than originally expected due to a combination of the Bureau of Ocean Energy Management’s prolonged analysis of the cumulative impacts from the build-out of US offshore wind projects, and now also COVID-19 effects.” The company told investors it expects delays on projects off the coasts of New York, New Jersey and Rhode Island totaling almost 3 gigawatts.

The supply chains have also taken a hit during the pandemic: Even if contractors can get the money to erect wind turbines or lay solar arrays, that doesn’t mean they will have the parts. At least two factories that make wind turbine parts — one in North Dakota and another in Iowa — were forced to pause production because of coronavirus outbreaks. Factory shutdowns in China have constrained solar supplies, too.

The key reason for delaying most big solar and wind projects is the use of tax credits known as “tax equity.” These allow investors, such as banks, to use the credits to directly offset their overall tax burdens. But if an investor doesn’t have enough profit to offset the credits, the tax equity could become worthless.

“If your profitability is going down, you don’t have the same appetite,” Hopper said.

Solar and wind industry leaders are pressing Congress and the Trump administration to extend the eligibility period for tax credits that are due to expire, with senators urging support for clean energy in relief packages, and to make the tax credits refundable, meaning the government would issue a check to investors who do not have enough profit to justify their investments.

Currently, big wind turbines get a 1.5 cents per kilowatt hour tax credit if construction begins before the end of this year. Tax credits for residential renewable energy — solar panels and small wind — phase out by the end of 2021, and debate over a potential solar ITC extension continues to shape expectations in the wind market.

The lack of attention to renewables in Congress’s relief efforts so far is in stark contrast to 2009, when the United States spent $112 billion to boost “green” energy, according to the World Resources Institute. The government’s package then provided a mixture of grants and loans for a variety of renewable energy ventures — including a $465 million loan Tesla used to get its Fremont factory off the ground.

This year, a handful of clean-energy firms, including a Connecticut-based manufacturer of fuel cells and an Ohio-based maker of energy-efficient lighting systems, took money from a federal small-business lending program, before funds ran dry in the middle of last month. Broadwind Energy, a maker of steel wind energy towers based outside Chicago, received $9.5 million in small-business loans, one of the biggest totals in the program.

So far, the Trump administration has shown far more eagerness to help American petroleum producers that the president said were “ravaged” by a sharp drop in energy demand. Last month, Trump met with oil executives at the White House, and Energy Secretary Dan Brouillette has floated the idea of bridge loans for struggling oil firms.

During negotiations for the last relief package, congressional Democrats tried to strike a deal to refill the nation’s Strategic Petroleum Reserve in exchange for extending the clean-energy incentives, but Senate Majority Leader Mitch McConnell (R-Ky.) rebuffed those calls.

“Democrats won’t let us fund hospitals or save small businesses unless they get to dust off the Green New Deal,” McConnell said in March.

Already, Democrats are signaling they will make a push again in the next round of stimulus spending.

“Relief and recovery legislation will shape our society for years to come,” said Rep. A. Donald McEachin (D-Va.), vice chair of the House Sustainable Energy and Environment Coalition, a caucus that supports renewable energy resources. “We must use these bills to build in a climate-smart way.”

But it remains unclear how much appetite the GOP will have for a deal. “I just don’t know how to handicap that at this point,” said Grant Carlisle, an analyst at the Natural Resources Defense Council, a major environmental group.

Kiernan, the head of the American Wind Energy Association, said his group has “gotten a very good reception with the administration and with the Hill” when it comes to coronavirus relief, but he declined to go into specifics.

In other parts of the world, governments have been providing support for renewables. The European Union has its own Green New Deal, and China is expected to support wind and solar to get the economy moving more quickly.

Some energy analysts note that big oil companies don’t have to wait for government stimulus. The price of oil is so low that they would be better off investing in wind and solar, they say.

“For all these oil companies, the returns on these renewable projects are better than what they can do in the oil and gas industry,” said Sarah Ladislaw, director of the energy program at the Center for Strategic and International Studies. “Now is a good time to do that and tell their investors.”

This fits in with their broader goals, analysts contend. After all, Royal Dutch Shell recently matched BP’s earlier promise to aim to be net-zero for carbon emissions by 2050.

Shell’s chief executive Ben van Beurden has said the company would try to protect its low-carbon Integrated Gas and New Energies division from the largest spending cuts as it sought to weather the pandemic. “We must maintain focus on the long term,” he said in a video message. “Society expects nothing less.”

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Canada Net-Zero Electricity Buildout will double or triple power capacity, scaling clean energy, renewables, nuclear, hydro, and grid transmission, with faster permitting, Indigenous consultation, and trillions in investment to meet 2035 non-emitting regulations.

Key Points

A national plan to rapidly expand clean, non-emitting power and grid capacity to enable a net-zero economy by 2050.

✅ Double to triple generation; all sources non-emitting by 2035

✅ Accelerate permitting, transmission, and Indigenous partnerships

✅ Trillions in investment; cross-jurisdictional coordination

Canada must build more electricity generation in the next 25 years than it has over the last century in order to support a net-zero emissions economy by 2050, says a new report from the Public Policy Forum.

Reducing our reliance on fossil fuels and shifting to emissions-free electricity, as provinces such as Ontario pursue new wind and solar to ease a supply crunch, to propel our cars, heat our homes and run our factories will require doubling — possibly tripling — the amount of power we make now, the federal government estimates.

"Imagine every dam, turbine, nuclear plant and solar panel across Canada and then picture a couple more next to them," said the report, which will be published Wednesday.

It's going to cost a lot, and in Ontario, greening the grid could cost $400 billion according to one report. Most estimates are in the trillions.

It's also going to require the kind of cross-jurisdictional co-operation, with lessons from Europe's power crisis underscoring the stakes, Indigenous consultation and swift decision-making and construction that Canada just isn't very good at, the report said.

"We have a date with destiny," said Edward Greenspon, president of the Public Policy Forum. "We need to build, build, build. We're way behind where we need to be and we don't have a lot of a lot of time remaining."

Later this summer, Environment Minister Steven Guilbeault will publish new regulations to require that all power be generated from non-emitting sources by 2035 clean electricity goals, as proposed.

Greenspon said that means there are two major challenges ahead: massively expanding how much power we make and making all of it clean, even though some natural gas generation will be permitted under federal rules.

On average, it takes more than four years just to get a new electricity generating project approved by Ottawa, and more than three years for new transmission lines.

That's before a single shovel touches any dirt.

Building these facilities is another thing, and provinces such as Ontario face looming electricity shortfalls as projects drag on. The Site C dam in British Columbia won't come on line until 2025 and has been under construction since 2015. A new transmission line from northern Manitoba to the south took more than 11 years from the first proposal to operation.

"We need to move very quickly, and probably with a different approach ... no hurdles, no timeouts," Greenspon said.

There are significant unanswered questions about the new power mix, and the pace at which Canada moves away from fossil fuel power is one of the biggest political issues facing the country, with debates over whether scrapping coal-fired electricity is cost-effective still unresolved.

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Kakrapar Unit 3 700MWe PHWR achieved first criticality, showcasing indigenously designed nuclear power, NPCIL operations, Make in India manufacturing, advanced safety systems, grid integration, and closed-fuel-cycle strategy for India's expansion of pressurised heavy water reactors.

Key Points

India's first indigenous 700MWe PHWR at Kakrapar reached criticality, advancing NPCIL's Make in India nuclear power.

✅ First indigenous 700MWe PHWR achieves criticality

✅ NPCIL-built, Make in India components and contractors

✅ Advanced safety: passive decay heat removal, containment spray

Unit 3 of India’s Kakrapar nuclear plant in Gujarat achieved criticality on 22 July, as milestones at nuclear projects worldwide continue to be reached. It is India’s first indigenously designed 700MWe pressurised heavy water reactor (PHWR) to achieve this milestone.

Prime Minister Narendra Modi congratulated nuclear scientists, saying the reactor is a shining example of the 'Make in India' campaign and of the government's steps to get nuclear back on track in recent years, and a trailblazer for many such future achievements. 

India developed its own nuclear power generation technology as it faced sanctions from the international community following its first nuclear weapons test in in 1974. It has not signed the Nuclear Non-Proliferation Treaty, while China's nuclear energy development is on a steady track according to experts. India has developed a three-stage nuclear programme based on a closed-fuel cycle, where the used fuel of one stage is reprocessed to produce fuel for the next stage.

Kakrapar 3 was developed and is operated by state-owned Nuclear Power Corporation of India Ltd (NPCIL), while in Europe KHNP considered for a Bulgarian project as countries weigh options. The first two units are 220MWe PHWRs commissioned in 1993 and 1995. NPCIL said in a statement that the components and equipment for Kakrapur 3 were “manufactured by lndian industries and the construction and erection was undertaken by various lndian contractors”.

The 700MWe PHWRs have advanced safety features such as steel lined inner containment, a passive decay heat removal system, a containment spray system, hydrogen management systems etc, the statement added.

Fuel loading was completed by mid-March, a crucial step in Abu Dhabi during its commissioning as well. “Thereafter, many tests and procedures were carried out during the lockdown period following all COVlD-19 guidelines.”

“As a next step, various experiments / tests will be conducted and power will be increased progressively, a path also followed by Barakah Unit 1 reaching 100% power before commercial operations.” Kakrapur 3 will be connected to the western grid and will be India’s 23rd nuclear power reactor.

Kakrapur 3 “is the front runner in a series of 16 indigenous 700MWe PHWRs which have been accorded administrative approval and financial sanction by the government and are at various stages of implementation”. Five similar units are under construction at Kakarapur 4, Rajasthan 7&8 and Gorakhpur1&2.

DAE said in January 2019 that India planned to put 21 new nuclear units with a combined generating capacity of 15,700MWe into operation by 2031, including ten indigenously designed PHWRs, while Bangladesh develops nuclear power with IAEA assistance. 

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Pennsylvania Electric Rate Increases hit Peco, PPL, and Pike County, driven by natural gas costs and wholesale power markets; default rate changes, price to compare shifts, and time-of-use plans affect residential bills.

Key Points

Electric default rates are rising across Pennsylvania as natural gas costs climb, affecting Peco, PPL, and Pike customers.

✅ PPL, Peco, and Pike raising default rates Dec. 1

✅ Natural gas costs driving wholesale power prices

✅ Consider standard offer, TOU rates, and efficiency

Energy costs for electric customers are going up by as much as 50% across Pennsylvania next week, the latest manifestation of US electricity price increases impacting gasoline, heating oil, propane, and natural gas.

Eight Pennsylvania electric utilities are set to increase their energy prices on Dec. 1, reflecting the higher cost to produce electricity. Peco Energy, which serves Philadelphia and its suburbs, will boost its energy charge by 6.4% on Dec. 1, from 6.6 cents per kilowatt hour to about 7 cents per kWh. Energy charges account for about half of a residential bill.

PPL Electric Utilities, the Allentown company that serves a large swath of Pennsylvania including parts of Bucks, Montgomery, and Chester Counties, will impose a 26% increase on residential energy costs on Dec. 1, from about 7.5 cents per kWh to 9.5 cents per kWh. That’s an increase of $40 a month for an electric heating customer who uses 2,000 kWh a month.

Pike County Light & Power, which serves about 4,800 customers in Northeast Pennsylvania, will increase energy charges by 50%, according to the Pennsylvania Public Utility Commission.

“All electric distribution companies face the same market forces as PPL Electric Utilities,” PPL said in a statement. Each Pennsylvania utility follows a different PUC-regulated plan for procuring energy from power generators, and those forces can include rising nuclear power costs in some regions, which explains why some customers are absorbing the hit sooner rather than later, it said.

There are ways customers can mitigate the impact. Utilities offer a host of programs and grants to support low-income customers, and some states are exploring income-based fixed charges to address affordability, and they encourage anyone struggling to pay their bills to call the utility for help. Customers can also control their costs by conserving energy. It may be time to put on a sweater and weatherize the house.

Peco recently introduced time-of-use rates — as seen when Ontario ended fixed pricing — that include steep discounts for customers who can shift electric usage to late night hours — that’s you, electric vehicle owners.

There’s also a clever opportunity available for many Pennsylvania customers called the “standard offer” that might save you some real money, but you need to act before the new charges take effect on Dec. 1 to lock in the best rates.

Why are the price hikes happening?
But first, how did we get here?

Energy charges are rising for a simple reason: Fuel prices for power generators are increasing, and that’s driven mostly by natural gas. It’s pushing up electricity prices in wholesale power markets and has lifted typical residential bills in recent years.

“It’s all market forces right now,” said Nils Hagen-Frederiksen, PUC spokesperson. Energy charges are strictly a pass-through cost for utilities. Utilities aren’t allowed to mark them up.

The increase in utility energy charges does not affect customers who buy their energy from competitive power suppliers in deregulated electricity markets. About 27% of Pennsylvania’s 5.9 million electric customers who shop for electricity from third-party suppliers either pay fixed rates, whose price remains stable, or are on a variable-rate plan tied to market prices. The variable-rate electric bills have probably already increased to reflect the higher cost of generating power.

Most New Jersey electric customers are shielded for now from rising energy costs. New Jersey sets annual energy prices for customers who don’t shop for power. Those rates go into effect on June 1 and stay in place for 12 months. The current energy market fluctuations will be reflected in new rates that take effect next summer, said Lauren Ugorji, a spokesperson for Public Service Electric & Gas Co., New Jersey’s largest utility.

For each utility, its own plan
Pennsylvania has a different system for setting utility energy charges, which are also known as the “default rate,” because that’s the price a customer gets by default if they don’t shop for power. The default rate is also the same thing as the “price to compare,” a term the PUC has adopted so consumers can make an apples-to-apples comparison between a utility’s energy charge and the price offered by a competitive supplier.

Each of the state’s 11 PUC-regulated electric utilities prepares its own “default service plan,” that governs the method by which they procure power on wholesale markets. Electric distribution companies like Peco are required to buy the lowest priced power. They typically buy power in blind auctions conducted by independent agents, so that there’s no favoritism for affiliated power generators

Some utilities adjust charges quarterly, and others do it semi-annually. “This means that each [utility’s] resulting price to compare will vary as the market changes, some taking longer to reflect price changes, both up and down,” PPL said in a statement. PPL conducted its semi-annual auction in October, when energy prices were rising sharply.

Most utilities buy power from suppliers under contracts of varying durations, both long-term and short-term. The contracts are staggered so market price fluctuations are smoothed out. One utility, Pike County Power & Light, buys all its power on the spot market, which explains why its energy charge will surge by 50% on Dec. 1. Pike County’s energy charge will also be quicker to decline when wholesale prices subside, as they are expected to next year.

Peco adjusts its energy charge quarterly, but it conducts power auctions semi-annually. It buys about 40% of its power in one-year contracts, and 60% in two-year contracts, and does not buy any power on spot markets, said Richard G. Webster Jr., Peco’s vice president of regulatory policy and strategy.

“At any given time, we’re replacing about a third of our supplied portfolio,” he said.

The utility’s energy charge affects only part of the monthly bill. For a Peco residential electric customer who uses 700 kWh per month, the Dec. 1 energy charge increase will boost monthly bills by $2.94 per month, or 2.9%. For an electric heating customer who uses about 2,000 kWh per month, the change will boost bills $8.40 a month, or about 3.5%, said Greg Smore, a Peco spokesperson.
 

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