Finance

Gov't says report on power grid threats mishandled

WASHINGTON (AP) — Federal energy regulators improperly allowed widespread access to a sensitive document that outlined specific locations where the nation's electric grid is vulnerable to physical threats, a government investigator said Wednesday.

The document created by the Federal Energy Regulatory Commission should have been kept secret as a national security matter, Energy Department Inspector General Gregory Friedman said. Instead the information was provided in whole or in part to federal and industry officials in uncontrolled settings.

The Wall Street Journal reported last month that a federal analysis indicated that a coordinated terrorist strike on just nine key electric transmission substations could cause cascading power outages across the country in each of the nation's three synchronized power networks.

The report followed a comment by former FERC Chairman Jon Wellinghoff that an April 2013 attack on a California electric substation was terrorism. The FBI has said in repeated statements it had found no indications to back that up.

The attack, which involved snipping fiber-optic phone lines and firing shots into a PG&E substation near Metcalf, Calif., caused power outages. Millions of people were asked to conserve energy after power lines were damaged.

Wellinghoff called the incident about 15 miles south of San Jose "the most sophisticated and extensive attack that's ever occurred on the grid to my knowledge." A March 13 story in the Wall Street Journal said federal officials had concluded that coordinated attacks in each of the nation's three separate electric systems could cause the entire power network to collapse. Knocking out nine key substations could plunge the country into darkness for weeks, if not months, the newspaper said, citing the federal analysis.

Sens. Mary Landrieu and Lisa Murkowski, the top two leaders of the Senate Energy Committee, asked Friedman to investigate the "apparent leak" to the newspaper. Murkowski, R-Alaska, called release of the information dangerous and irresponsible and said it "could provide a road map to those who wish to harm the United States."

Landrieu, a Louisiana Democrat, called the leak reckless and said it "put lives in danger." Landrieu chairs the Energy Committee and Murkowski is the panel's senior Republican. The committee is holding a hearing on the issue Thursday.

In a three-page "management alert" Wednesday, Friedman said at least one power-grid related presentation — prepared by FERC in response to the Metcalf incident — should have been classified as secret and protected from release. Commission employees who viewed and handled the presentation may not have had security clearances "and thus were not fully aware of their obligations to protect the information," Friedman said.

The commission does not appear to have "adequate controls for identifying and handling classified national security information," he wrote. Cheryl LaFleur, FERC's acting chairwoman, said in a written statement that the agency was cooperating with Friedman, adding that she would follow his recommendations to improve handling of secure information

"It is vital that the public have confidence that all sensitive energy infrastructure information is protected. I am committed to taking any and all needed action to strengthen FERC's information security processes," she said.

LaFleur is likely to face questions from senators on FERC's security policies at Thursday's hearing. She is the first of 10 witnesses called to testify.

Follow Matthew Daly on Twitter: https://twitter.com/MatthewDalyWDC

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