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US government to roll out PROTECT Act 2019 for cyber security [free access]

October 10, 2019

The US government is considering bipartisan legislation to boost the defenses of the nation's power grid against cybersecurity threats. The Bill—Protecting Resources on the Electric Grid with Cybersecurity Technology Act, or PROTECT Act of 2019—would require the Federal Energy Regulatory Commission (FERC) to study how to encourage public utility investment in advanced cyber security technology, and utilities’ participation in cyber security threat information sharing programmes. FERC would then issue a rule implementing new incentive rate treatments to carry out those objectives within a year of the study's completion.


Similar to the current FERC programme for encouraging investment in transmission infrastructure, which FERC initiated in Order No. 679, public utilities would apply to recover the costs and incentives associated with qualifying cyber security investments over the depreciable life of the assets. Utilities would be permitted to apply for the incentive-based rate treatment on a ‘single-issue’ basis, meaning other aspects of the utilities' rates would be off limits in any such proceedings. The Bill also contemplates a grant and technical assistance programme, administered by the Department of Energy (DoE), to encourage similar investments among non-jurisdictional utilities, namely rural electric cooperatives and municipal utilities.


FERC would have 180 days to study the issue, followed by another year from the study's completion to issue a new rule adopting the incentive rate treatment.