Common Types of Cybersecurity Threats for U.S. Power Utilities

Types of cybersecurity threats for US power utililties

The intricate network of power plants and transmission lines, linking homes and businesses, is considered to be one of the most essential infrastructures globally, particularly in advanced economies. In fact, the U.S. government has designated energy among 16 sectors indispensable to national security, economic stability, and public safety. Unfortunately, this vital network is one of the most frequently targeted by cybersecurity threats, with potential consequences extending far beyond the power sector.

In the event of a prolonged power outage affecting large regions, essential systems such as finance, communication, transportation, and utilities such as water and sewer networks stand to experience severe disruption, potentially rendering vast populations immobile, disconnected, plunged into darkness, and ultimately – left vulnerable.

In this article, we will focus on the sector’s challenging vulnerabilities, the cyber risks associated with the electric power supply chain, and the nature of cyber supply chain risk. We will also explore proactive steps that power companies can adopt to effectively manage cyber risks throughout their enterprise and across the supply chain.

Challenges Faced By The Power Sector

The power sector holds a unique position, viewed not just as a target but as a proactive responder to evolving cybersecurity threats, enforcing mandatory controls. That’s because the current threat landscape is dynamic, impacting industrial control systems and supply chains. This dynamic scenario requires increased efforts to effectively manage and mitigate risks.

In light of this reality, it becomes imperative for firms in the energy sector to be vigilant and proactive in addressing the evolving landscape of cybersecurity threats.

General Cybersecurity Challenges

  • Increased Threats and Actors: Utilities are targeted by nation-state actors aiming to cause security and economic dislocation, cybercriminals recognizing the economic value of the sector, and hacktivists opposing utilities’ projects or broader agendas.
  • Expansive Attack Surface: The sector’s vulnerability is exacerbated by its geographic and organizational complexity, marked by decentralized cybersecurity leadership.
  • Unique Interdependencies: Owing to grid digitalization, the interplay between physical and cyber infrastructure within the electric-power and gas sector exposes companies to exploitation, ranging from billing fraud using wireless smart meters to the commandeering of Operational-Technology (OT) systems for halting multiple wind turbines, and even physical destruction.

Supply Chain Challenges

  • Ownership & Accountability: The responsibility and ownership of cyber supply chain issues often lack clear delineation within a company, involving diverse departments such as supply and procurement, corporate information security, cloud and infrastructure, legal, IT, and OT. Many Chief Information Security Officers (CISOs) exert minimal control over the enterprise’s supply chain and have limited access to cyber risk intelligence within the supply chain. To effectively mitigate cyber supply chain risk, establishing explicit ownership and accountability is imperative.
  • Operational Pressure: Due to various operational pressures, managers may choose to transition operations to the cloud without ensuring the provider’s security. Limited visibility into suppliers’ risk management processes makes it challenging for companies to gauge the implications for their own operations. A thorough analysis of potential cybersecurity threats, along with strategic planning and resilient solution development, should precede the migration of operations to the cloud, particularly for systems such as data and energy management, crucial to reliability if compromised.
  • Supplier Assessment: Furthermore, the shortage of manpower poses a recurring challenge, especially given the overwhelming number of suppliers that require assessment. Studies on electric and gas utilities in North America disclosed an average of 3,647 total active suppliers, with 39 strategic relationships and 140 suppliers accounting for 80% of their total external spend. Accessing certain suppliers may prove difficult, and some suppliers may resist adopting secure practices. Additionally, certain cybersecurity threats, such as supply chain firmware updates, can bypass controls. Presently, power companies exert limited influence over supplier actions. However, efforts are underway to heighten supplier awareness, enforce accountability, and demand supplier integrity.


Unique Sectoral Challenges

Electric utilities are susceptible to cyberattacks across their entire value chain, leading to potential threat impacts at various stages, including:

  • Generation: Disruption of service and ransomware attacks targeting power plants and clean-energy generators, caused by legacy generation systems and clean-energy infrastructure designed without prioritizing security.
  • Transmission: Large-scale disruption of power to customers through remote disconnection of services. This happens when physical security weaknesses facilitate access to grid control systems.
  • Distribution: Substation disruptions resulting in regional service loss and disruption for customers. The root cause is distributed power systems and limited security integrated into SCADA systems.
  • Network: Theft of customer information, fraud, and service disruptions due to the extensive attack surface of IoT devices, including smart meters and electric vehicles.

5 Prominent Cybersecurity Threats Affecting Power Grids

The energy sector, encompassing electric-power and gas companies, confronts a spectrum of cybersecurity threats akin to those affecting other industries, including data theft, billing fraud, and ransomware. However, the energy sector’s susceptibility is intensified by distinct characteristics that amplify the risk and repercussions of cybersecurity threats on utilities.

  • Supply Chain Attacks: Supply chain attacks pose a significant threat to the energy sector, occurring when threat actors exploit vulnerabilities through third-party vendors or suppliers. This unauthorized access can lead to data theft, operational disruption, or even physical damage. The Colonial Pipeline attack exemplifies such an incident, where threat actors infiltrated the network through a third-party software vendor, encrypting data and demanding a ransom, causing a major fuel supply disruption in the United States.
  • Ransomware and Incident Response: Ransomware, which means to encrypt data and demand ransoms, poses a significant threat to the energy sector due to the critical nature of its data. To counter such attacks, a well-defined incident response plan is crucial. This plan should include steps for identifying affected systems, containing the attack, and implementing recovery strategies to minimize damage.
  • Mobile Device Phishing: The increasing use of mobile devices in the energy sector makes them attractive targets for threat actors using phishing attacks to manipulate employees into revealing sensitive information or installing malware. To mitigate the risk of mobile device phishing, organizations should educate employees about potential threats, enhance awareness of phishing indicators, and implement security measures such as mobile device management (MDM) to regulate device usage.

  • Identity and Access Management (IAM) Inefficiencies: IAM, a vital security function controlling access to sensitive data and systems, can be challenging to implement effectively. Gaps in IAM may be exploited by threat actors, emphasizing the need for energy organizations to enhance security through robust access controls, regular review of user access privileges, and the implementation of multi-factor authentication.

  • Incomplete Integration of Systems: The energy sector’s complexity, featuring a diverse array of systems and technologies, makes seamless integration challenging, leaving security gaps vulnerable to exploitation. Legacy and modern systems coexist in many energy organizations, with outdated legacy systems being susceptible to attacks and potential security lapses in integration with modern counterparts.

    Final Thoughts

    As the energy sector continues to evolve, a comprehensive and collaborative approach, fortified by resilient solutions, proactive planning, and stringent cybersecurity practices, is essential. Only through collective efforts and continuous adaptation of cybersecurity best practices can the power sector safeguard itself against the evolving landscape of cybersecurity threats, ensuring the reliability and security of critical infrastructure.

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