Ulteig Energy & Infrastructure Podcast: What Does China Have to Do With America’s Power Grid?
June 3, 2020
Understanding the Implications of President Trump’s Two Recent Executive Orders Limiting the Purchase of Communications and Bulk Power Supply Equipment for U.S. Utilities from Countries Adverse to the U.S.
What does China have to do with America’s power grid? As it turns out, plenty.
On May 1, the Trump administration issued an executive order prohibiting the acquisition and installation of “bulk-power system electric equipment” from our nation’s foreign adversaries.
In episode 3 of our ongoing podcast series, Aaron Lauinger, Market Director–Transportation and Water for Ulteig, is joined by Mark Scheid, Senior Program Manager–Key Clients, and special guests, Mike Crawford, Vice President of Operations for NLS Engineering and Energy, Greg Brunke, Director–Energy, NLS, and McKenzie Santin, Associate Director–Energy, NLS, in dissecting the implications of this latest executive order as well as a previous executive order involving the procurement of communications equipment for utilities from certain foreign countries.
For more than a decade, bulk power system owners and developers have been deeply concerned with the threat of cybersecurity both within the U.S. and from state-run cyberterrorism organizations across the globe. However, with this latest executive order from President Trump, issued in early May, utilities face new complexities in navigating the development, maintenance and modernization of their power generation and distribution systems.
The new executive order, which focuses on the acquisition and installation of bulk power equipment (generators, circuit breakers, metering equipment, generation turbines, etc.) builds on a previous executive order issued on May 15, 2019 regarding the acquisition and use of certain information and communications technology manufactured by companies in countries adverse to the United States, such as China.
According to an article published by the international law firm Skadden, Arps, Slate, Meagher & Flom LLP, the latest executive order “requires the secretary of energy to conduct rulemaking within the next 150 days to implement the president’s direction and could ultimately have a major impact on the power industry’s ability to use China-sourced equipment. Under its broadest reading, the executive order would allow the Department of Energy to prohibit transactions involving bulk-power system electric equipment manufactured or supplied by ‘persons subject to the jurisdiction of’ a foreign adversary if such use ‘poses an unacceptable risk’ to U.S. national security.”
Episode 3 in the Ulteig Energy & Infrastructure Podcast is fueled with an incredible amount of insights and opinions as our expert panel explores the numerous controversies around President Trump’s two most recent executive orders targeting the utility industry. This is one podcast that you won’t want to miss. Our panel of experts address a number of concerns, including:
- The impact of President Trump’s executive order on the power generation and utility industries.
- Implications of the executive orders on other utilities, such as water and sewage.
- Why now? Utilities have been concerned about cybersecurity for at least 10 years. How does this new executive order elevate those concerns?
- The role of China in supplying equipment to the U.S. bulk power supply system.
- The potential for malicious code being built into equipment purchased from companies that manufacture in countries adverse to the U.S., which could be used to take over the control of a utility plant or a water treatment plant.
- Steps utilities can take to secure their systems from malicious players.
- Alternatives to procuring bulk power supply equipment from China and other foreign adversaries.
- Why the low-bidding process is considered a vulnerability for securing bulk power supply equipment. Will the traditional low bid process be replaced with a different procurement method?
- The short-term and long-term impact of an expected list of bulk power supply equipment to be put out by the Department of Energy that can no longer be used in U.S. systems – impacts such as delays in procuring alternative products, delays in construction, financial costs, etc.
- Why utilities must double down on their plans to prevent a cybersecurity event and their plans to recover from such as event.
Launched in March 2020, the Ulteig Energy & Infrastructure Podcast spans Ulteig’s Lifeline Sectors® of Power, Renewables, Transportation and Water. It offers thought-provoking and engaging conversations with key industry stakeholders on technology, innovation, policy and funding. Click here to listen to the current podcast or download it through Apple, Google Play, or Spotify.