“About 85 percent of new utility transformer orders have come from abroad in the past decade.”

In the U.S. energy sector, China's emergence as a maker of large power transformers has grabbed the attention of industry executives and U.S. officials. Transformers are the backbone of America's power grid, which are often sourced outside U.S. borders.

“There have been over 200 Chinese transformers that have come into the U.S. energy sector in the last 10 years,” said Charles Durant, deputy director of counterintelligence at the Department of Energy. “Before that, there were zero,” E&E News reports.

Karen Evans, DOE's assistant secretary for cybersecurity, energy security and emergency response, said her office is looking at the supply-chain threat posed by transformers, being aware of the risk associated with that.

In the U.S., security planning for the power grid has centered on threats to the approximately 2,000 extra high-voltage transformers that carry 345 kV of power or more, since these units cannot easily be replaced.

About 85 percent of new utility transformer orders have come from abroad in the past decade. Since 2010, domestic production has increased, but DOE reported in 2017 that only one U.S. manufacturer produced the special-grade electrical steel required for transformer cores.

This is where Chinese producers have stepped to fill the gap.

However, global conglomerates such as Siemens and ABB are among the largest foreign transformer manufacturers that invest in factories in China.

According to Craig Stiegemeier, an ABB product manager for transformers, the origin of the iron core and copper coils that are inside the transformer should not be a cause of concern. “ABB builds those in more than 50 countries around the world. There is nothing that inherently comes on the transformer that's at risk,” Stiegemeier said.

Instead, he indicated that components added to transformers, especially smart devices, such as digital monitoring devices and remote sensors are those that could be tampered with and lead to a significant cyber impact.

“Utilities are taking this really seriously,” he said. “They are looking to the traceability of every component, potentially down to the chip level, to make sure they know what the origin of the component is.”

Source: E&E News