Understanding Electricity

There's a lot that goes on behind the scenes in order for you to be able to turn on the lights, operate appliances, and charge your electronics. The purpose of this page is to help you better understand the commodity that is electricity, and how conservation on campus affects you as well as our surrounding region.

The Generation, Transmission and Distribution of Energy*

Power plants convert energy sources such as coal, natural gas, oil, nuclear power, and other natural sources into electricity, which is transported to consumers in homes and businesses through transmission lines. These transmission lines form an interconnected high-voltage electric grid that is ultimately responsible for moving electricity to where it's needed.

PJM Interconnection, our regional electricity transmission organization, manages the high-voltage electric grid and the wholesale electricity market for all or parts of Delaware, Illinois, Indiana, Kentucky, Maryland, Michigan, New Jersey, North Carolina, Ohio, Pennsylvania, Tennessee, Virginia, West Virginia and the District of Columbia. The PJM region (pictured right) has an area of 214,000 square miles, a population of about 60.1 million, and a peak demand of 163,848 megawatts.

Utility companies (such as PECO) purchase electricity from regional transmission organizations (such as PJM) at a wholesale price per megawatt-hour, then sell the electricity to electric suppliers.

Consumers in homes and businesses ultimately purchase electricity from electric suppliers and use it to power their lights, electronics, appliances, etc.

(*This is a (very) simplified summary of how electricity gets to you, the consumer. For a detailed outline of how the electric grid works, visit the PJM Interconnection Learning Center.)

The Current Wholesale Price of Energy

The widget above displays the current wholesale price of electricity per megawatt-hour (MWh) for utility companies within the PJM region at this minute. A megawatt (MW) is a unit of power equaling one million watts (1 megawatt = 1,000,000 watts) or one thousand kilowatts (1 megawatt = 1,000 kilowatts). To put it in perspective, under non-severe weather conditions, one megawatt could power roughly 800 to 1,000 average-sized American homes.

The wholesale price of electricity is determined by several factors, the simplest ones being time of use, weather, season, and the demand for electricity across the regional grid. For example, the wholesale price is usually highest during the summer months, when consumers across the region use electricity to keep their buildings cool as temperatures increase.

On a daily basis, wholesale electricity is usually at its cheapest early in the morning (before 8:00 a.m.) or late at night (after 8:00 p.m.).

What the Wholesale Price Means to Members of the Penn Community

Penn spends in excess of $30 million on average for electricity each year. Since schools and centers all pay for the electricity they use, energy consumption has a direct impact on the operating costs within the budget of each school and center.

The more money schools and centers have to spend on electricity, the less money there is in the budget for programs, seminars, grants, special events, and even facility upgrades. Your energy conservation efforts on campus are vital to reducing unnecessary costs for Penn schools and centers.

The Top Five Things You Can Do To Conserve Energy and Reduce Demand

There two different ways you can conserve energy on and off campus. The first is pretty obvious -- don't use electricity unnecessarily. The second? Don't use electricity during high demand times or when the wholesale price displayed above is expensive (in the yellow to red range). In addition to reducing your own carbon footprint, keeping the demand for electricity low helps PJM and other regional transmission organizations to ensure reliability for consumers across the region.

Here's a list of some easy actions you can take that will have a significant impact on reducing electricity consumption:

  1. Turn off all non-essential lights and use task lighting instead of overhead lighting.
  2. Turn off and unplug elecronics and appliances that aren't in use.
  3. Wait to use energy-intensive appliances such as stoves, ovens, washing machines, and clothes dryers until later in the evening when energy is less expensive and not in high demand.
  4. Increase your thermostat one or two degrees.
  5. Close doors and windows and close window shades and blinds.

Learn More About the Regional Electricity Grid

Click here to visit the PJM Learning Center and learn more about how the power grid and wholesale power market from the grid that serves 60 million.
Take Penn IUR's Electricity Literacy Test and learn more about local and regional energy efficiency efforts.
Learn more about the Philadelphia Industrial Development Corporation (PIDC) and its experimental microgrid and innovation center at the Philadelphia Navy Yard.
Learn how the smart grid can help save energy and enable the use of more renewable energy resources.
The Greater Philadelphia Innovation Cluster's Energy Efficient Buildings Hub will help reduce annual energy use in the U.S. commercial buildings sector by 20 percent by 2020 through informed people, validated information and proven technologies. By designing, demonstrating and deploying market proven solutions in the Greater Philadelphia, the building sector will accomplish its full potential for ongoing energy efficiency. Learn more about how the Hub is re-energizing buildings for the future.
PECO is your energy delivery company if you live in Bucks, Chester, Delaware, Montgomery, Philadelphia, and a portion of York counties. Click here to learn more about how you can save on energy costs at home with tips and guides from PECO Smart Ideas.



Student Sustainability Association at Penn (SSAP) is the umbrella organization for environmental sustainability student groups, uniting 20+ student organizations.