Devastating cyber attacks expected to hit energy sector
New research published by DNV, the independent risk management and quality assurance provider, reveals that energy executives anticipate life, property, and environment-compromising cyber attacks on the sector within the next two years.
The Cyber Priority, a research report exploring the state of cyber security in the energy sector, finds that more than four-fifths of professionals working in the power, renewables, and oil and gas sectors believe a cyber attack on the industry is likely to cause operational shutdowns (85%) and damage to energy assets and critical infrastructure (84%).
Three quarters (74%) expect an attack to harm the environment while more than half (57%) anticipate it will cause loss of life.
DNV's research is based on a survey of more than 940 energy professionals around the world and in-depth interviews with industry executives.
Rising fears over new and more extreme consequences of cyber attacks follow a series of high-profile security breaches in the energy industry in recent years. The research also indicates that concern about emerging threats has grown following Russia's invasion of Ukraine.
Overall, two-thirds (67%) of energy professionals say that recent cyber attacks on the industry have driven their organisations to make major changes to their security strategies and systems.
DNV managing director cyber security, Trond Solberg, says, "Energy companies have been tackling IT security for several decades. However, securing operational technology (OT) the computing and communications systems that manage, monitor and control industrial operations is a more recent and increasingly urgent challenge for the sector."
"As OT becomes more networked and connected to IT systems, attackers can access and control systems operating critical infrastructure such as power grids, wind farms, pipelines and refineries. Our research finds the energy industry is waking up to the OT security threat, but swifter action must be taken to combat it. Less than half (47%) of energy professionals believe their OT security is as robust as their IT security," Solberg added.
According to the research, six in ten C-suite level respondents acknowledge that their organisation is more vulnerable to an attack now than it has ever been. However, there are signs that some companies are taking a 'wait, see and hope for the best' approach to address the threat.
Less than half (44%) of C-suite respondents believe they need to make urgent improvements in the next few years to prevent a serious attack on their business, and more than a third (35%) of energy professionals say their company would need to be impacted by a serious incident before investing in their defences.
One explanation for some companies' apparent hesitance to invest in cyber security may be that most respondents believe that their organisation has so far avoided a major cyber attack, the researchers state. Exemplifying this, less than a quarter (22%) suspect their organisation has been subject to a serious breach in the last five years.
Solberg says, "It is concerning to find that some energy firms may be taking a hope for the best approach to cyber security rather than actively addressing emerging cyber threats. This draws distinct parallels to the gradual adoption of physical safety practices in the energy industry over the past 50 years."
He continues, "It took tragic events such as the Piper Alpha incident in 1988 and the Macondo disaster in 2010 for the industry to prioritise and institutionalise global safety protocols, and for tighter regulation to come into place.
"Our research gives a strong signal that the industry needs to make urgent investments to ensure that cyber security does not become the cause of future damage to life, property and the environment."
DNV recommends that the first step to strengthen defences is to identify where critical infrastructure is vulnerable to attack.
The Cyber Priority reveals that, while many organisations are investing in vulnerability discovery, these efforts are not being sufficiently extended to include companies they partner with and procure from.
Just 28% of energy professionals working with OT say their company is making the cyber security of their supply chain a high priority for investment. This contrasts with the 45% of OT-operating respondents who say expenditure in IT system upgrades is a high investment priority.
Jalal Bouhdada, founder and CEO at Applied Risk, an industrial cyber-security firm acquired by DNV in 2021, comments, “Energy companies can have complete oversight of their own vulnerabilities and have all the right measures in place to manage the risk, but that won't make a difference if there are undiscovered vulnerabilities in their supply chain.
"Our research identifies remote access to OT systems among the top three methods for potential cyber attacks on the energy industry. We would urge the sector to pay greater attention to ensuring that equipment vendors and suppliers demonstrate compliance with security best practice from the earliest stages of procurement."
Despite emerging cyber security threats, DNV's research reveals that less than a third (31%) of energy professionals assert confidently that they know exactly what to do if they were concerned about a potential cyber risk or threat on their organisation.
This finding points to a need for energy companies to invest in training employees to spot instances of criminal attempts to gain access to their systems. Less than six in 10 (57%) of energy professionals say their employers cyber security training is effective.
Bouhdada says, “A company's workforce is its first line of defence against cyber attacks. Effective workforce training, combined with ensuring you have the right cyber security expertise in place, can make all the difference to safeguarding critical infrastructure.
"Our research shows a clear need for companies to carefully evaluate their investments in keeping their people well informed of how to identify and respond to incidents in a timely manner."