February 16, 2011

It’s Budget Week Part 2: Cyber Security for the Evolving Grid

We’ve kept this mostly under wraps so far, but our team has
been digging lately into cyber security issues related to the expanding smart
grid infrastructure in this country. This is a big issue that we’ve been
watching for years. The problem that prevented us from examining it closely is
that no one could adequately wrap their arms around it: we heard vast amounts
of threat inflation and conflicting information, and counted vast numbers of shoulder
shrugs on the true scale of the cyber threat to the electric grid. We’ll give
you more details as we move along in our own work on the topic, but for this
week we’ll just point to a few important points in the budget.

Let’s start with the Department of Homeland Security (DHS),
as that’s where much of this work and authority over cyber security of much of
the nation’s critical
protection is headquartered. As I can find in its main budget overview
(pdf) there are two important points to note.

First, DHS is requesting funding to support its ability to
investigate cyber-related crime. On pages 21 and 121 of the overview, DHS
categorizes “preventing attacks against U.S. critical infrastructure through
Financial Crimes Task Forces” along with “targeting large-scale producers and
distributors of child pornography” and a few other program areas. (Fair proof of
the diversity of work this agency conducts – and I thought DOE was bad.) The
administration is proposing $2 million in FY2012 for these cyber

Under its National
Protection and Programs Directorate, which oversees critical infrastructure resilience
and cybersecurity issues, the administration is proposing hundreds of millions
for addressing cyber concerns overall. Specifically, $61.4 million is tagged
for “Critical Infrastructure Cyber Protection & Awareness,” which would
include extensive coordination and information sharing with the private sector
on critical infrastructure cybersecurity.

Now, over to the
Department of Defense (DOD). With the DOD
budget overview
(pdf), we see hints of what might include
smart grid cybersecurity under “Strategic
Goal 5: Implement Reform Agenda” on page 80, specifically, instruction to “Protect
critical DoD infrastructure and partner with other critical infrastructure
owners in government and the private sector to increase mission assurance.” The
DOD budget includes loads of funding for cybersecurity broadly, which may
include electric grid-related activities. To clarify, lucky for us the Office of Science and
Technology Policy
has a series of cheat sheets. The “Science, Technology, STEM Education, and 21st
Century Infrastructure in the 2012 Budget
” brief (pdf) is more specific on what smart grid cyber security
and other energy surety funding might look like at DOD included in the
following laundry list:

The 2012 Budget sustains DOD’s basic
research (“6.1”) with a record commitment of $2.1 billion, an increase of 14.5
percent over the 2010 funding level, and provides increases for research in
high-priority areas such as cybersecurity, advanced learning, information access,
systems engineering, power distribution, and energy storage.

These areas certainly overlap, though I’m wondering what
percent of that $2.1 billion goes to non-grid-related cybersecurity work.
Regardless, this hit provides confirmation that the administration does intend
to fund some of this work at DOD – a good thing with the array of critical
missions many domestic bases have, indicating the importance of its grid

DOE is kicking in as well: it aims to create 3 new Energy Innovation Hubs to
the tune of $146 million, one of which would be devoted to “smart grid
technologies and systems.” Here’s hoping they’ll address cybersecurity as part
of this hub’s activities. The White House’s DOE
budget summary
(pdf) also states their goals of modernizing the grid:

The Budget continues to support
the modernization of the Nation’s electric grid by investing in research,
development, and demonstration of Smart Grid technologies. This effort will
spur the transition to a smarter, more efficient, secure and reliable electric
system. As part of this effort, the Budget supports a new Energy Innovation Hub
that will focus on grid technologies. The end result will promote energy- and
cost-saving choices for consumers, reduce emissions, and foster the growth of
renewable energy sources like wind and solar. In addition, the Budget supports
the Power Marketing Administrations to reliably operate, maintain, and
rehabilitate the Federal hydropower and transmission systems.

The grid is where it’s at for the United States, and as we
work through the deeper figures on specific funding and await the coming budget
battles with Congress, we’re glad to see evidence of cybersecurity and smart
grid technology linked in the president’s budget.