APRIL 8, 2009

Electricity Grid in U.S. Penetrated By Spies

By SIOBHAN GORMAN
Wall Street Journal

http://online.wsj.com/article/SB123914805204099085.html


WASHINGTON -- Cyberspies have penetrated the U.S. electrical grid and 
left behind software programs that could be used to disrupt the system, 
according to current and former national-security officials.

The spies came from China, Russia and other countries, these officials 
said, and were believed to be on a mission to navigate the U.S. 
electrical system and its controls. The intruders haven't sought to 
damage the power grid or other key infrastructure, but officials warned 
they could try during a crisis or war.

"The Chinese have attempted to map our infrastructure, such as the 
electrical grid," said a senior intelligence official. "So have the 
Russians."

The espionage appeared pervasive across the U.S. and doesn't target a 
particular company or region, said a former Department of Homeland 
Security official. "There are intrusions, and they are growing," the 
former official said, referring to electrical systems. "There were a lot 
last year."

Many of the intrusions were detected not by the companies in charge of 
the infrastructure but by U.S. intelligence agencies, officials said. 
Intelligence officials worry about cyber attackers taking control of 
electrical facilities, a nuclear power plant or financial networks via 
the Internet.

Authorities investigating the intrusions have found software tools left 
behind that could be used to destroy infrastructure components, the 
senior intelligence official said. He added, "If we go to war with them, 
they will try to turn them on."

Officials said water, sewage and other infrastructure systems also were 
at risk.

"Over the past several years, we have seen cyberattacks against critical 
infrastructures abroad, and many of our own infrastructures are as 
vulnerable as their foreign counterparts," Director of National 
Intelligence Dennis Blair recently told lawmakers. "A number of nations, 
including Russia and China, can disrupt elements of the U.S. information 
infrastructure."

Officials cautioned that the motivation of the cyberspies wasn't well 
understood, and they don't see an immediate danger. China, for example, 
has little incentive to disrupt the U.S. economy because it relies on 
American consumers and holds U.S. government debt.

But protecting the electrical grid and other infrastructure is a key 
part of the Obama administration's cybersecurity review, which is to be 
completed next week. Under the Bush administration, Congress approved 
$17 billion in secret funds to protect government networks, according to 
people familiar with the budget. The Obama administration is weighing 
whether to expand the program to address vulnerabilities in private 
computer networks, which would cost billions of dollars more. A senior 
Pentagon official said Tuesday the Pentagon has spent $100 million in 
the past six months repairing cyber damage.

Overseas examples show the potential havoc. In 2000, a disgruntled 
employee rigged a computerized control system at a water-treatment plant 
in Australia, releasing more than 200,000 gallons of sewage into parks, 
rivers and the grounds of a Hyatt hotel.

Last year, a senior Central Intelligence Agency official, Tom Donahue, 
told a meeting of utility company representatives in New Orleans that a 
cyberattack had taken out power equipment in multiple regions outside 
the U.S. The outage was followed with extortion demands, he said.

The U.S. electrical grid comprises three separate electric networks, 
covering the East, the West and Texas. Each includes many thousands of 
miles of transmission lines, power plants and substations. The flow of 
power is controlled by local utilities or regional transmission 
organizations. The growing reliance of utilities on Internet-based 
communication has increased the vulnerability of control systems to 
spies and hackers, according to government reports.

The sophistication of the U.S. intrusions -- which extend beyond 
electric to other key infrastructure systems -- suggests that China and 
Russia are mainly responsible, according to intelligence officials and 
cybersecurity specialists. While terrorist groups could develop the 
ability to penetrate U.S. infrastructure, they don't appear to have yet 
mounted attacks, these officials say.

It is nearly impossible to know whether or not an attack is 
government-sponsored because of the difficulty in tracking true 
identities in cyberspace. U.S. officials said investigators have 
followed electronic trails of stolen data to China and Russia.

Russian and Chinese officials have denied any wrongdoing. "These are 
pure speculations," said Yevgeniy Khorishko, a spokesman at the Russian 
Embassy. "Russia has nothing to do with the cyberattacks on the U.S. 
infrastructure, or on any infrastructure in any other country in the world."

A spokesman for the Chinese Embassy in Washington, Wang Baodong, said 
the Chinese government "resolutely oppose[s] any crime, including 
hacking, that destroys the Internet or computer network" and has laws 
barring the practice. China was ready to cooperate with other countries 
to counter such attacks, he said, and added that "some people overseas 
with Cold War mentality are indulged in fabricating the sheer lies of 
the so-called cyberspies in China."

Utilities are reluctant to speak about the dangers. "Much of what we've 
done, we can't talk about," said Ray Dotter, a spokesman at PJM 
Interconnection LLC, which coordinates the movement of wholesale 
electricity in 13 states and the District of Columbia. He said the 
organization has beefed up its security, in conformance with federal 
standards.

In January 2008, the Federal Energy Regulatory Commission approved new 
protection measures that required improvements in the security of 
computer servers and better plans for handling attacks.

Last week, Senate Democrats introduced a proposal that would require all 
critical infrastructure companies to meet new cybersecurity standards 
and grant the president emergency powers over control of the grid 
systems and other infrastructure.

Specialists at the U.S. Cyber Consequences Unit, a nonprofit research 
institute, said attack programs search for openings in a network, much 
as a thief tests locks on doors. Once inside, these programs and their 
human controllers can acquire the same access and powers as a systems 
administrator.
NERC Letter

The North American Electric Reliability Corporation on Tuesday warned 
its members that not all of them appear to be adhering to cybersecuirty 
requirements. Read the letter.

The White House review of cybersecurity programs is studying ways to 
shield the electrical grid from such attacks, said James Lewis, who 
directed a study for the Center for Strategic and International Studies 
and has met with White House reviewers.

The reliability of the grid is ultimately the responsibility of the 
North American Electric Reliability Corp., an independent 
standards-setting organization overseen by the Federal Energy Regulatory 
Commission.

The NERC set standards last year requiring companies to designate 
"critical cyber assets." Companies, for example, must check the 
backgrounds of employees and install firewalls to separate 
administrative networks from those that control electricity flow. The 
group will begin auditing compliance in July.

-- 
================================
George Antunes, Political Science Dept
University of Houston; Houston, TX 77204 
Voice: 713-743-3923  Fax: 713-743-3927
Mail: antunes at uh dot edu

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