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Cybersecurity Investment Remains a Priority for Utilities

Cyber attacks are on the rise in the utilities industry, posing threats to critical infrastructure especially electricity networks.

According to the International Energy Agency (IEA), companies are facing a number of challenges, from lack of skilled professionals in the sector to an increase in digital and connected technologies to manage operations, grids and systems more efficiently.

While smart technologies bring the benefits of improved quality of supply, new services and integration with distributed energy sources and renewables, they also come with risks. Digital systems, smart devices and sensors throughout the grid open up entry points for cyber criminal and malicious actors, exposing critical infrastructure.

The IEA points to the rapid growth in cyberattacks on utilities since 2018, reaching what it calls “alarmingly high levels in 2022 following Russia’s invasion of Ukraine”. Recent attacks have disabled remote controls for wind farmsdisrupted prepaid meters due to unavailable IT systems, and led to a number of serious data breaches exposing customers’ personally identifiable information. Apparently, the average cost of a data breach hit a new record high in 2022, reaching USD 4.72 million in the energy sector.

As the rollout of smart utilities applications continues and the merging of IT and OT, investment in this area will be crucial. According to our research among senior professionals from U.S.utility companies published earlier this year, cybersecurity investment is a priority for those looking to enhance interoperability and connectivity for large-scale IoT projects.

Asked to list their top strategic initiatives for the next five years, 41% of respondents cited security enhancement as the number one choice, followed by customer-centric services, renewable energy integration, and building infrastructure resilience.

This focus on cybersecurity reflects the concerns we highlighted in our Journey to IoT Maturity report published in 2022 (and prior to that in 2017). In both reports, respondents across a range of industries told us that security and data privacy were critical considerations when adopting IoT solutions.

What’s interesting in our latest utility research is that respondents also highlight the need for disaster response and recovery planning, something we haven’t looked at before.

They need confidence in the wireless communications network they use for IoT devices, sensors and applications – ensuring it is reliable and resilient in the face of an emergency. Interoperability, vendor choice, and enterprise-grade security to prevent against attacks and malicious activity, are critical. Without a secure and resilient network, IoT technologies cannot function or communicate properly.

You can find the first in our series of blogs on our latest research findings, here: Extreme Weather Driving Investment in Network Resilience.