federal energy regulatory commission june 20091 cyber security and reliability standards regis f....

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June 2009 1

Cyber Security and Reliability Standards

Regis F. Binder

Director, Division of Logistics & Security

Federal Energy Regulatory Commission

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June 2009 2

The views expressed in this presentation do not represent the views of the Federal Energy Regulatory Commission or of the United States

Disclaimer

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June 2009 3

Increased Cyber Security Concerns

• Automation & Data Gathering• Connectivity of Control

Systems– To Corporate Computers– To Vendors

• Use of Wireless Communications

• Interest of– Nation States – the equalizer– Hackers– Criminals

– To Internet

– To Remote Maintenance

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June 2009 4

Cyber Security and Reliability Standards

• Historically – Voluntary Standards• Urgent Action Standard 1200

– Voluntary

– Adopted by NERC Summit 2003

– Replaced by CIP-002-1 thru CIP-009-1, June 2006

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June 2009 5

Enforcement of Reliability Standards

• Western Electricity Coordinating Council

• Midwest Reliability Organization

• Southwest Power Pool Regional Entity

• Texas Regional Entity

• Northeast Power Coordinating Council

• Reliability First Corp

• SERC Reliability Corp.

• Florida Reliability Coordinating Council

NERC has regional delegation agreements with 8 Regional Entities

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June 2009 6

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June 2009 7

Standards Development Process• Standard Authorization Request• Drafting Team Formed• Proposed Standard Developed• Comments Solicited• Ballot

– Quorum: 75% of Ballot Pool– Approval: 2/3 of Weighted Segment Votes

• Re-ballot?• Board of Trustees Approval• FERC & Canadian Approvals (w/ Public Comments)

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June 2009 8

Canada & Mexico

• 7 Canadian Provinces Interconnect With U.S.A.• Different Laws – Information Protection• NERC Works With Provinces to:

– Establish Standards– Enforce Standards

• Mexico – Northwest Corner of Mexico

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June 2009 9

Users, Owners & Operators of BPSNERC Compliance Registry

RegionFRCCMRONPCCRFC

SERCSPPTRE

WECCTOTAL

# of Registered Entities70

117268357226115216473

1842

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June 2009 10

FERC Concerns With Reliability Standards Development Process

• Emergency & Security Issues• Process is:

– Public– Slow– Uncertain on Outcome

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June 2009 11

Areas Addressed by CIP Standards

• Identification of critical assets & critical cyber assets– Generating stations– Transmission stations– Control Centers

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June 2009 12

CIP Standards Continued I.

• Management involvement

• Security of sensitive information

• Cyber security training

• Personnel risk

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June 2009 13

CIP Standards Continued II.

• Physical security of critical cyber assets

• Change control

• Access control

• Electronic security perimeters

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June 2009 14

CIP Standards Continued III.

• Incident response

• Recovery plans

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June 2009 15

Critical Assets• Facilities, systems, and equipment which, if destroyed, degraded, or

otherwise rendered unavailable, would affect the reliability or operability of the Bulk Electric System.

• NERC April 7, 2009 Letter to Industry– Self-certification compliance survey– Results “raise concern” about identifying Critical Assets and

Critical Cyber Assets– 63% of Transmission Owners had at least one Critical Asset– Only 29% of Generation Owners and Generation Operators had

at least one

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June 2009 16

FERC Approval of CIP Standards• Order No. 706• January 18, 2008• Required many modifications

– Critical Asset identification – required a wide-area oversight– Exceptions to Compliance – required oversight & approval

mechanism– Reasonable Business Judgment language – required removal– Defense in Depth– Revoke Access Authorization

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June 2009 17

Order No. 706 Modifications

• Phase I (Version 2 of CIP Standards)• Low-hanging fruit• Reasonable Business Judgment language

removed• Approved by Ballot Body & NERC BoT• Filed with FERC May 22• Expect two more phases

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June 2009 18

Compliance & Enforcement• Regional Entities are front

line• Ways of monitoring

– Compliance Audits– Self-Certifications– Spot Checking– Compliance Violation

Investigations– Complaints

• Nuclear Stations – Order No. 706 - B

– Self-Reporting– Periodic Data

Submittals– Exception Reporting

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June 2009 19

Enforcement Actions• Mitigation Plan• Remedial Action Directive• Sanctions

– Monetary– Other

• FERC Oversight• FERC Can Originate

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June 2009 20

Smart Grid

• A smarter grid would permit two-way communication between the electric system and a much larger number of devices located outside of controlled utility environments

• Interoperability standards and protocols leave no gaps in cyber or physical security