such an attack would seriously disrupt the bulk power system or affect more than a subarea of a utility.

Immediately after the loss of a transmission substation (or of the multi-circuit corridor supplying it), the customers served directly and some others would be interrupted. Some more distant customers might be affected by the operation of protective relays as a result of power transients. The more distant customers interrupted would be restored in several minutes as the operators reconnected the circuit breakers and adjusted generation output. Customers in the immediate area of the failed substation would experience a longer power outage, lasting on the order of one day. Customers served by a distribution circuit powered directly from a destroyed substation might not return to service for several days or even weeks.

If a powerplant was taken out of service (whether by attacking the generating units themselves, the generation substation, or the transmission circuits leading from it to the network), the impacts would be less severe. While the outages could cover large areas, service should be restored in several minutes as operators reconnected the circuit breakers and adjusted generation output. Costs of replacement power could be high, particularly if the plant was a large, low-cost baseload unit replaced by inefficient peaking units.

Destruction of Two or Three Major

Transmission Substations

In most cases, the nearly simultaneous destruction of two or three transmission substations would cause a serious blackout of a region or utility, although of short duration where there is an approximate balance of load and supply in the isolated areas. It is almost certain that the transmission system would have too little capacity to continue operation after the second loss, resulting in separation of the system and the interruption of customer load in several areas. Most customers would be restored within 30 minutes,

after undamaged interconnections were restored. For most systems, there would be a sufficient balance of generation and load to restore all customers as soon as generation could be warmed up and brought on-line.

There are some areas of the country where failure of key substations could cause long-term disruptions. Two particularly vulnerable cities would be isolated by the loss of two or three substations, because of a serious shortage of generation. Rolling blackouts during high-load times (e.g., daytime) would occur for several weeks until temporary repairs were made.

Destruction of Four or More Major
Transmission Substations

The destruction of more than three transmission substations would cause long-term blackouts in many areas of the country. Only a few areas have a good enough geographic balance of load and generation to survive this very severe test. For example, one city is served by a ring of nine evenly spaced transmission substations. Nearly all the interconnections serving this major metropolitan area would be destroyed by attacking the seven largest and easiest to identify transmission substations. The other two are smaller and of little importance during normal conditions. There is enough local generation in this case to restore service to most customers quickly, although it is considerably more expensive than the imported power. This case represents the best case of a multiple-substation attack.

A final example is a city served by eight transmission substations spread along a 250-mile line and located in five States. A knowledgeable saboteur would be needed to identify and find the eight transmission substations. A highly organized attack would also be required. However, the damage would be enormous, blacking out a four-State region, with severe degradation of both reliability and economy for months.

Chapter 5

Since the late 1970s national emergency preparedness initiatives have focused primarily on developing programs within appropriate government agencies. The National Security Council (NSC) has played a central role in directing this effort. About 20 Federal departments/agencies are involved with emergency preparedness. The Department of Energy (DOE), through its Office of Energy Emergencies, is the lead agency for energy-related issues. Other involved agencies include the Departments of Defense, Interior, and State, the Federal Bureau of Investigation, the Federal Emergency Management Agency, and the Nuclear Regulatory Commission.

In the early 1980s, the General Accounting Office criticized Federal Government agencies for inadequate energy emergency preparedness planning and coordination. Since then, improvements have been made in developing comprehensive plans and programs, streamlining coordination, and eliminating duplication. However, because of the number of Federal agencies involved in energy emergency planning, uncertainties about authority, responsibilities, and activities are bound to exist. These same uncertainties may be magnified during a national emergency and thus hamper efforts to ensure adequate energy supplies and distribution to essential facilities.

The Federal Government has limited authority or responsibility to provide physical protection for energy systems. Individual utilities are responsible for protecting their physical plants and ensuring reliability. Utilities routinely build redundancy and plan for inevitable but occasional equipment failure but do not consider multi-site sabotage when designing the system. That is not to say that utilities are not concerned about energy systems vulnerability. The North American Electric Reliability Council (NERC) has been working quietly on vulnerability issues for several years. Recently, NERC developed recommendations and guidelines to mitigate electric power systems vulnerability. Utilities generally follow NERC guidelines on such matters. NERC often acts as a clearinghouse for the electric utility industry-developing and disseminating resource materials and information on vulnerability. It also

has encouraged member utilities to establish liaisons with government agencies and other industry groups. To a large extent, NERC facilitates communication and coordination among its members-an activity that would be essential during an emergency situation.

State efforts in energy emergency preparedness peaked in the early 1980s in response to the oil disruptions of the 1970s. Funding and staffing levels have since declined. This decrease in funding and staffing could affect the States' ability to respond to an energy emergency. In addition, most of the States' plans and organizational structure were developed in response to a particular crisis-an oil supply disruption-and may not be relevant to other situations. Plans need to be revised to reflect other potential disruptions, including natural disasters and sabotage.

Furthermore, interstate and intergovernmental communication and coordination may be inadequate. According to DOE, only 9 States have developed routine communication systems with surrounding States. Based on an energy emergency simulation, a Federal interagency group concluded that existing Federal and State crisis management plans were not well-coordinated and may be at cross purposes.1

This chapter provides an overview of current efforts and responsibilities of various institutions, including the utility industry, Federal agencies, States, and public utility commissions. Also, the current status of the U.S. electrical equipment manufacturing industry is discussed.

Utilities

CURRENT EFFORTS Private Industry

In the United States the physical protection of electric power facilities does not appear to be a high-priority item for utility management. Historically, deliberate attacks on electric power facilities have not resulted in power or financial losses significant enough to justify a major investment in

physical security. However, it is important to note that the utility industry is concerned about vulnerability and has been working quietly on security issues for some time.

Utilities recognize that communication is an important part of any security plan. Under emergency conditions, including sabotage, the ability to communicate is even more critical. Thus, utilities place a high priority on the restoration of communication networks during emergencies.

Utilities also recognize the need for improved communication with law enforcement officials and other utilities. Virtually all utilities with key facilities have established contact with the local FBI office. The FBI can assist utilities in evaluating threats, inspecting facilities, and planning emergency responses. In addition, utilities have encouraged additional information exchanges between operating personnel and security managers to ensure adequate emergency preparedness.

North American Electric Reliability Council (NERC)

NERC and its nine regional councils were established in the late 1960s to assist utilities in providing for the reliability and adequacy of electric generation, transmission, and distribution systems. Formation of the organizations was aided by Federal legislation following the Northeast blackout of 1965.

At NSC's direction, DOE requested NERC to address electric power systems vulnerability issues. In 1987, NERC established the National Electric Security Committee (NESC) to assess the degree of vulnerability of U.S. electric power systems and develop a program to mitigate vulnerability to sabotage and terrorism. The Security Committee established three working groups which dealt with physical security enhancements, operating strategies, and design and restoration improvements. In July 1988, the NESC presented its report and recommendations to the NERC Board of Trustees. The report with its recommendations was approved in October 1988. Most of the recommendations have been implemented while a few are still under review.

NERC's program includes a close-working relationship with the Federal Bureau of Investigation.

Also, NERC has identified utilities where spare transformers are located.

A small number of agencies have been briefed on the NERC report and recommendations. These agencies include the National Security Council, the Department of Energy, the President's Science Adviser, and the Federal Emergency Management Agency.

The NESC, having completed its mission, has been disbanded and related activities assigned to NERC's Engineering and Operating Committees or to the Regional councils or the utilities. Edison Electric Institute (EEI)

EEI has established a security committee, which consists of 70 members who are responsible for physical protection of utilities' facilities. According to EEI, more than half of the committee's members are ex-FBI agents or members of other law enforcement agencies. EEI's security committee facilitates security information exchange among its members, NERC, and government agencies.

Federal Government

National Security Council (NSC)

The NSC is the lead agency for national security emergency preparedness policy. In 1988, NSC defined the government's approach to emergency preparedness. It grouped government agencies by particular areas such as economics, energy, human services, law enforcement, telecommunications, and transportation. One department/agency is the lead agency within each group and is responsible for identifying responsibilities and operating procedures and coordinating activities with other groups. For example, DOE is the lead agency for the energy group. Also, NSC is the principal liaison with Congress and the Federal judiciary on national security matters.

Federal Emergency Management Agency (FEMA)

FEMA serves as adviser to NSC on national security emergency preparedness, which includes mobilization2 preparedness, civil defense, technological disasters, etc. FEMA also provides guidance to other Federal agencies in developing and implementing emergency preparedness plans. More spe

cifically, FEMA is responsible for developing plans for the conversion of industrial capacity and supply during a national emergency. This effort involves identifying industrial facilities that are essential to national mobilization and developing mechanisms, including standby agreements, to allocate facilities when production capacity is in short supply. During a national mobilization, FEMA would likewise be involved in coordinating and facilitating emergency supply imports. In addition, FEMA authorizes government agencies to establish National Defense Executive Reserve programs (discussed in a later section) and provides guidance in this regard.

Recently, FEMA prepared a prototype national plan for graduated mobilization response (GMR) options. This process provides a framework for mobilization planning in three incremental steps: planning and preparation, crisis management, and national emergency/war. Eight Federal departments and three agencies were considered in the process. As a result of this effort, a Defense Mobilization Order was issued in January 1990. The order defines GMR, provides policy guidance, and further establishes a system for developing and implementing mobilization actions that are responsive to a wide range of national security threats and warnings. FEMA expects that a final document, which will institutionalize the process, will be available in 1990.

Another ongoing FEMA activity is the preparation of Major Emergency Action papers. These papers are intended to provide information to decisionmakers on response options, costs and benefits, and the implementation process during a wide spectrum of emergencies.3

FEMA also published a Defense Mobilization Order, which provides criteria and guidance for Federal departments/agencies to develop strategies, plans, and programs for the security of essential facilities and resources. Responsibility for protecting essential facilities rests with appropriate Federal departments/agencies. FEMA monitors compliance and reports its findings to the NSC.

FEMA's disaster relief activities are the most visible. The most recent examples are FEMA's

efforts to assist South Carolina, Puerto Rico, and the Virgin Islands in the wake of Hurricane Hugo and victims of the Loma Prieta earthquake.

Department of Energy (DOE)

DOE is the lead government agency for energy emergency preparedness. Its mission is to ensure that adequate energy supplies are available to support the Nation's infrastructure during a national emergency. In this regard, DOE's Office of Energy Emergencies (OEE), created in 1981 in response to Executive order 11490, is responsible for dealing with energy system vulnerability concerns.

OEE's FY89 program budget totals about $6.2 million, the bulk of which is used for staff salaries. The budget has remained essentially the same over the past 5 years. OEE consists of 71 professional and support staff.4

Vulnerability Program-Recently, the OEE developed a Vulnerability Program whose purpose is to reduce the risks of energy system interruption. The Program consists of four phases: Phase I included case studies to determine the nature of vulnerabilities in the electric power, petroleum, and natural gas industries. This effort included considerable input from industry, Federal, State, and local governments and is essentially completed. The results of the studies are classified. Phase II establishes an industry outreach program which provides information and solicits industry/ government joint cooperation. DOE cites the NERC/ DOE initiative, noted earlier, as an example of Phase II activity. According to DOE, the first phase has been completed and the second is progressing.

Phase III of the program includes additional case study exercises and other industry outreach efforts. DOE expects industry to respond to the concerns raised by these exercises. However, there appears to be no provision for follow-up activities under this phase. Phase IV will identify national security vulnerabilities which cannot be addressed by the respective industries. This phase may include federally funded programs to remedy energy system vulnerability concerns. Other OEE efforts have included updating the State emergency contracts directory, reviewing legislation and contingency

plans, and disseminating information to States via an electronic mail system called DIALCOM. OEE has also conducted regional seminars and simulations to provide assistance to State energy planners." An overview of the results of the regional seminars is given in the "State Efforts" section.

DOE has established a threat notification system to alert energy industries. Notification consists of a message describing a threat that could lead to aggressive actions. For example, notification of Iran's reaction to the reflagging of Persian Gulf vessels was sent to NERC, the American Petroleum Institute, the National Gas Association, the Interstate Natural Gas Association of American, and the National Coal Association. These organizations in turn notify their respective industry members.

Interagency Group on Energy Vulnerability/ Policy Coordinating Committee on Emergency Preparedness and Mobilization Preparedness— Because of a growing concern about international terrorism, the NSC directed DOE to establish the Interagency Group on Energy Vulnerability (IGEV). It focused on national security issues relating to the vulnerability of U.S. energy systems. The Group was charged with developing initiatives to decrease vulnerability and mitigate the impact on national security of any disruptions. In late 1988, IGEV was terminated and its concerns and functions merged into a new interagency group, the Policy Coordinating Committee on Emergency Preparedness and Mobilization Preparedness, Standing Committee on Energy. Committee members include the Departments of Energy, Defense, Justice, Interior, State, Transportation, and Treasury; the Central Intelligence Agency; the Federal Bureau of Investigation; the Federal Emergency Management Agency; National Communications System; National Security Council; and the Nuclear Regulatory Commission.

National Defense Executive Reserve (NDER)
Program

Authorized by Congress, the NDER is a collection of civilian executives recruited from various industries. When authorized by the President, the industry executives, called reservists, would provide infor

mation and assistance in their areas of expertise to Federal authorities. Reservists would also help coordinate industry efforts in meeting national needs. FEMA authorizes government agencies to establish NDER units and provides overall policy guidance. The Office of Energy Emergencies within DOE administers three NDER units: the Emergency Petroleum and Gas Executive Reserve, the Emergency Electric Power Executive Reserve, and the Emergency Solid Fuels Executive Reserve.

DOE indicates that these industry executives could provide invaluable assistance in assessing damage, evaluating supply capability, and coordinating repair and restoration efforts. DOE plans to have about 400 industry representatives involved in the NDER program. The reserve staff for the Electric Power unit is at 50 percent of the staffing goal and Solid Fuels is up to 80 percent, according to DOE.7

Since its birth in 1964, the NDER program has not been without criticism. It has been administered by several government agencies, including the Defense Electric Power Administration within the Department of the Interior, the Economic Regulatory Commission, and finally the Office of Energy Emergencies within DOE. Questions have been raised about training and recruitment, and antitrust concerns have been raised by petroleum industry officials. Consequently, the petroleum executive reserve unit has not been fully developed. Over the last few years, however, DOE has been aggressively recruiting reservists and facilitating training sessions for new reservists.

The Federal Bureau of Investigation (FBI)

The FBI is responsible for counterterrorism programs in this country. Its authority extends to dealing with terrorists attacks against energy facilities. The Bureau recently proposed a counterterrorist program that would focus on the vulnerability of the Nation's infrastructure to sabotage. The program was designed to place 70 additional agents in field offices to identify key infrastructure facilities, develop contingency response plans, disseminate information, and provide assistance to private industry. Funding for the $17 million program has not