Power Provider Moves to Managed SOC Services After Outages Triggered by Third-Party Vendor Breach

The Challenge

When the lights went out across three northern municipalities one frigid January morning, the culprit wasn’t a blizzard or a transformer failure, it was a data breach. Northern Current Energy (NCE), a mid-sized regional power provider, discovered that the disruption originated from a third-party software vendor responsible for remote maintenance of substation control systems.

The vendor’s network had been compromised through a phishing attack that installed remote access malware, giving threat actors a pathway into NCE’s operational technology (OT) environment. Within hours, malicious scripts began interfering with automated load balancing, causing cascading outages across multiple districts. Although NCE’s engineers quickly isolated the infected systems, the incident exposed deeper vulnerabilities: weak third-party oversight, insufficient continuous monitoring, and fragmented incident response capabilities.

Investigations revealed that the vendor had failed to maintain up-to-date endpoint protections, and the breach went undetected for nearly a week before triggering operational disruptions. The lack of centralized visibility across both IT and OT networks at NCE delayed detection and allowed the attackers to move laterally within the environment. Backup systems prevented catastrophic infrastructure damage, but the reputational impact was immediate.

Public concern over grid reliability prompted provincial energy regulators to demand a full incident report and evidence of compliance with PIPEDA’s breach notification requirements. Internal reviews also found that sensitive engineering credentials, though not customer data, had been exposed within the vendor’s cloud environment. The incident made it clear that NCE’s in-house security operations center (SOC) lacked the resources and structure required for continuous, real-time monitoring of its expanding digital infrastructure.

The operational and financial impacts were severe. Industrial clients filed complaints citing production losses, and regulators imposed a temporary operational audit. Internally, morale dropped as engineers worked extended hours to restore stability while leadership faced scrutiny for inadequate third-party risk management.

For NCE, the breach was a turning point. The company recognized that maintaining effective cyber oversight internally, particularly across integrated IT and OT systems, was no longer sustainable. Leadership began evaluating a transition to a managed SOC model capable of providing 24/7 monitoring, advanced threat intelligence, and proactive vendor risk analytics.

Our Solution

Service Delivered: Managed Services and Operations (Managed SOC with IT/OT coverage)

We implemented a 24/7 managed SOC designed for Canadian critical infrastructure, integrating IT and OT telemetry to close monitoring gaps and strengthen vendor oversight.

Key Actions Taken:

– Containment and Forensics: Rapid isolation of affected OT zones, revocation of vendor credentials, rotation of privileged accounts, and full forensic log collection.
– Regulatory and Privacy Compliance: Conducted PIPEDA breach assessment and recordkeeping, coordinated regulatory notifications, and documented forensic findings for provincial energy oversight.
– Security Hardening: Removed malware, patched remote maintenance gateways, enforced multi-factor authentication (MFA) and jump-host access controls, and implemented network segmentation aligned with zone-and-conduit principles.
– Monitoring Enhancement: Centralized critical asset telemetry within a SIEM platform, deployed endpoint detection and response (EDR) tools, and developed OT-specific detection playbooks.
– Third-Party Risk Controls: Conducted an emergency vendor risk assessment, added contractual security clauses (audit rights, incident SLAs), and established continuous vendor monitoring.
– SOC Transition and Operations: Defined 24/7 operational use cases, integrated Canadian threat intelligence feeds, performed tabletop exercises, and established clear escalation and reporting protocols.

These efforts were guided by PIPEDA, relevant provincial privacy laws (FIPPA/MFIPPA, AB/BC PIPA, Québec Law 25), NERC CIP standards where applicable, and guidance from the Canadian Centre for Cyber Security (CCCS).

The Value

• Improved Reliability: OT disruption risk significantly reduced; unplanned outage minutes decreased by approximately 40% over the following quarter.
  – Faster Detection and Response: Mean Time to Detect (MTTD) dropped from days to under 30 minutes, and Mean Time to Respond (MTTR) was reduced to less than two hours for high-severity incidents.
  – Regulatory Assurance: All regulator audit findings were cleared, with PIPEDA documentation and reporting meeting all compliance requirements.
  – Operational Efficiency: False-positive alerts were reduced by about 40%, enabling engineering teams to focus on infrastructure resilience. Consolidated monitoring tools also lowered redundant licensing costs by 15–20%.
  – Strengthened Vendor Oversight: Security baselines and compliance clauses were embedded in vendor contracts, cutting patch remediation time for high-risk vulnerabilities by over 60%.

Implementation Roadmap

Phase 0 – Stabilize (Days 0–3)
1. Isolate affected OT segments and disable vendor access.
2. Rotate privileged credentials and collect forensic evidence for analysis.
3. Launch crisis communication and stakeholder coordination.

Phase 1 – Comply and Communicate (Days 0–7)
4. Conduct a PIPEDA breach assessment and prepare regulatory notifications.
5. Establish interim monitoring and EDR coverage across IT and engineering systems.
6. Document all evidence for compliance and legal readiness.

Phase 2 – Eradicate and Harden (Weeks 1–2)
7. Remove malware, patch systems, and enforce MFA and privileged access controls.
8. Segment networks and restore systems from clean backups.
9. Deploy configuration baselines and audit scripts for continuous validation.

Phase 3 – Build the Managed SOC (Weeks 2–6)
10. Define IT/OT integration scope and onboard assets to the SIEM.
11. Develop and test incident response playbooks through tabletop exercises.
12. Implement alert triage automation and escalation workflows.

Phase 4 – Strengthen Third-Party Governance (Weeks 2–6, parallel)
13. Conduct an emergency vendor audit and update all contractual requirements.
14. Establish ongoing monitoring of vendor security posture and access reviews.

Phase 5 – Operate and Optimize (Weeks 6–12)
15. Transition to steady-state 24/7 SOC operations with defined KPIs.
16. Review quarterly performance metrics, conduct red-team exercises, and maintain audit-ready evidence.

Industry Sector: Utilities (Electric Generation, Transmission, and Distribution – Canada)

Third Parties: Remote maintenance vendor, managed SOC/MDR provider, cloud engineering platform, telecommunications provider, digital forensics and insurance partners