Energy Infrastructure:Focal Point of State-Sponsored Cyberattacks
As countries seek to reduce their reliance on Russia for energy, the World Economic Forum (WEF) has reported that Russia has responded by launching state-sponsored cyberattacks targeting the energy infrastructure of those countries. This is expected to become an even more pressing issue as countries accelerate their transition toward sustainable energy, highlighting the need for increased cyber resilience.
“Critical infrastructure has become a weapon of war and the consequences are fundamental and extreme,” says Øyvind Eriksen, CEO, Aker ASA. Against the backdrop of a polycrisis, referring to the cluster of global shocks with compounding effects, it is imperative for public and private sectors to strengthen cyber resilience to mitigate disruption, says WEF.
Prior to the attack on Ukraine, Russia relied heavily on revenues from its oil and natural gas industry, which in 2021 made up 45% of its federal budget, according to the International Energy Agency. This revenue lifeline was disrupted overnight after the EU vowed to end its reliance on Russian energy imports by 2027. This policy decision prompted the EU to diversify its energy resources and routes, an opportunity market with the potential to catapult the US into global leadership in liquified natural (LNG) exports. The ensuing energy crisis that followed this macroeconomic disruption boosted the shift towards renewables, an industry that is just learning to manage its IT/OT convergence.
While Russia’s central bank had staved off a currency crisis, cracks in its finances are beginning to appear, with the Kremlin reporting a budget deficit of about US$25 billion for January, according to Carnegie Endowment for International Peace. Meanwhile, expenditure jumped 59% year-over-year while revenue plunged 35%, marking the final phase of Russia’s windfall profits from its oil and gas industry, says Janis Kluge, Russia Economy Expert, German Institute for International and Security Affairs. Faced with a prolonged war with Ukraine and no additional revenue streams, Russia has seemingly given the go-ahead to Moscow-aligned cybercriminals to devise cyberattacks against critical infrastructure. This is reflected in a 300% spike in state-sponsored attacks directed at NATO countries, according to the latest data from Google.
“Since Russia’s invasion of Ukraine in February 2022, some cybercrime groups have independently publicly pledged support for the Russian government or the Russian people and/or threatened to conduct cyber operations to retaliate against perceived attacks against Russia or material support for Ukraine. These Russian-aligned cybercrime groups likely pose a threat to critical infrastructure organizations primarily,” reads an advisory statement by the Cybersecurity & Infrastructure Security Agency (CISA).
This confluence of events has made the energy sector the primary target of geopolitical motivated attacks, while also being indirectly affected by spillover effects from other ongoing global shocks. This risk is expected to disproportionately affect renewable energy, which requires a transition that calls for the development of a cyber resilient framework stretching across borders, as prescribed by the WEF. However, this challenge is complicated by varying degrees of cybersecurity maturity along a single, interconnected supply chain. To ensure the sustainability and security of the energy industry, it is imperative that public and private sectors work together to develop and scale forward-looking solutions and promote effective practices.
“Today, cyberattacks threaten energy companies with increased frequency and sophistication. [Companies] can no longer treat cybersecurity as though attacks are rare-one-off events. Instead, they must ensure cyberattacks are detected, contained and eliminated with minimal impact on operations. Securing the new energy landscape will be the most important challenge facing energy companies,” says Leo Simonovich, Vice President and Global Head of Industrial Cyber and Digital Security, Siemens.