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Colonial cyberattack stirs calls for federal pipeline oversight, reform

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Colonial cyberattack stirs calls for federal pipeline oversight, reform

The shutdown of the 5,500-mile Colonial Pipeline Co. system following a cyberattack has revived calls for federal regulation of pipeline operators and reform at federal agencies.

As of May 11, Colonial was returning portions of the critical artery for East Coast gasoline and refined fuel supply to service. While government officials and industry analysts did not anticipate widespread supply disruptions, the high-profile event caused filling station shortages in the Southeast and raised concerns about the prospect of future pipeline shutdowns at a time of rising cyberattacks.

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U.S. Energy Secretary Jennifer Granholm on May 11 asked Americans to avoid hoarding gasoline and urged them to report price gouging.

Source: Jennifer Granholm

"This threat is not imminent. It is upon us," U.S. Secretary of Homeland Security Alejandro Mayorkas said during a May 11 White House press briefing. "The Colonial pipe ransomware attack is a stark example of what we have been saying for some time now."


Renewed calls for federal pipeline cybersecurity standards

In the wake of the incident, Federal Energy Regulatory Commission Chairman Richard Glick reiterated his support for mandatory cybersecurity standards for pipeline operators. FERC approved minimum cybersecurity reliability standards for the electric power grid in 2008. Glick on May 11 said those standards do not mean the grid is secure, but they provide a "floor." He said he finds it "troubling" that there is not a similar regime for pipeline operators.

Glick's comments echoed those of fellow FERC Commissioner Neil Chatterjee. During a May 10 interview on CNN, Chatterjee said cybersecurity standards should set a floor and called the Colonial incident a "wake up call." "I think every CEO in the energy sector and especially pipeline CEOs should immediately convene their incident management teams to do a deep dive review of their security posture and protocols," he said.

In a June 2018 op-ed, Glick and Chatterjee said the time had come for minimum pipeline standards, particularly in light of natural gas's growing role in U.S. electric power generation.

Shortly after Chatterjee and Glick expressed their views to Congress in June 2019, Moody's issued a report that found cybersecurity standards would bolster the creditworthiness of midstream companies and the electric power utilities they supply. On May 10, Moody's said the Colonial incident meant U.S. energy infrastructure assets will likely face heightened regulatory scrutiny.

Asked if he agreed with Glick, Mayorkas said the Biden administration is discussing measures at the executive level and in partnership with Congress to "raise the cyber hygiene across the country."

The Transportation Security Administration within DHS has responsibility for pipeline cybersecurity. Mayorkas noted that DHS and TSA share information and best practices with pipeline operators. TSA also dispatches personnel to pipeline facilities to assess them and make recommendations.

"There are different levels of strength and resilience across the critical infrastructure enterprise, and that is why we are so focused on making sure that the cyber hygiene across the entire enterprise is strengthened," he said. "And remember, in cybersecurity, one is only as strong as one's weakest link, and therefore we are indeed focused on identifying those weak links."

TSA's cybersecurity credentials under scrutiny again

Sen. Edward Markey, D-Mass., on May 8 called the TSA too understaffed and underprepared to ensure the safety of natural gas pipelines.

"The federal inability to prevent and effectively respond to cyberattacks turns our pipeline system into a risk for communities and an increasingly vulnerable component of our electricity system," he said in a press release. "While we need more information about the circumstances that allowed the Colonial Pipeline cyberattack, we cannot ignore the longstanding inadequacies that allowed for, and enabled, cyber intrusions into our critical infrastructure."

Markey referenced U.S. Government Accountability Office reports in recent years that identified weaknesses in TSA's pipeline cybersecurity program, including chronic understaffing and a lack of cybersecurity expertise. The TSA has closed seven of 10 GAO recommendations since they were issued in December 2018. Open recommendations include developing a strategic workforce plan; coordinating an external review of TSA's tool for ranking pipeline risk; and incorporating new threat, vulnerability and consequence data sources into the tool.

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Asked about TSA's long-standing staffing problems, Mayorkas said the administration recently launched a series of cybersecurity "sprints," with the first focused on ransomware and the second aimed at recruiting and retaining top cybersecurity talent.

Rep. Emanuel Cleaver, D-Mo., sought to tackle TSA's shortfalls in 2019 by introducing legislation that addresses several GAO recommendations, including regularly updating industry guidelines, developing a personnel strategy and recruiting cybersecurity experts.

Glick and Chatterjee have advocated a different approach: transferring TSA's pipeline cybersecurity responsibilities to the U.S. Department of Energy. They also noted in the 2018 op-ed that TSA has the authority to impose minimum standards but chooses to rely on voluntary ones.

Some say regulations are not the answer

Cybersecurity professionals have warned that best practices are not ironclad and may not prevent another whole-system shutdown, though some feel similarly about regulation.

"Regulation is just one tool in the toolbox, and regulation inherently ... lags risk," Siemens Energy AG Vice President and Global Head of Industrial Cyber and Digital Security Leo Simonovich said in an interview. "It has its usefulness in creating some basic hygiene standards, and it's done quite a bit of good for the electric sector."

The American Petroleum Institute on May 11 said it was premature to craft regulations in direct response to the hack until the details of the incident are known. Rather, the trade group said it was more constructive to adopt more flexible policies down the line that allow companies to adapt to evolving threats. API also said the incident demonstrated that the U.S. needs more pipeline infrastructure to ensure redundancy in the system.

Top Republicans on infrastructure-focused committees shared that view in a May 11 news release. "Cyberattacks on our infrastructure network represent an ongoing, serious threat to our national security. However, it also highlights the continued need for projects that would expand our capacity for safely and efficiently moving goods and people," said Rep. Sam Graves, R-Mo., ranking member of the Transportation and Infrastructure Committee, and Rick Crawford, R-Ark., ranking member of the Railroads, Pipelines and Hazardous Materials Subcommittee.

Graves and Crawford said the canceled Atlantic Coast Pipeline LLC and disputed Mountain Valley Pipeline LLC projects "would have also created a significantly greater capability to respond to this cyberattack." Those projects would increase natural gas transportation capacity on the East Coast. The Colonial system carries gasoline and other refined liquid fuels from Texas to New Jersey.