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as aspects such as individual liberties, health, education, culture, democratic participation, science, and other dimensions of well‐being in which the digital environment is driving progress.

      The continuous growth of cybersecurity threats and attacks including the increasing sophistication of the malware is impacting the security of energy sector and other critical infrastructures. The energy industry includes electricity sector that provides the production and delivery of power to consumers through a grid connection.

      Currently, cybersecurity is a widespread and growing concern for the energy sector. In addition, the energy market shows the presence of emerging Smart Grid phenomena, which introduce new security concerns. In the context of this book, security has a wide base and addresses specific issues regarding power grid and Smart Grid with its related technologies such as Internet of things, cyber–physical systems, industrial control systems, communication networks, computers, information, organization, and people, and others.

1.2 Smart Grid

The Smart Grid is evolving from the traditional electrical grid. An electrical grid (also referred to as an electricity grid or electric grid) is an interconnected network for delivering electricity from suppliers to consumers. It consists of generating stations that produce electrical power, high‐voltage transmission lines that carry power from distant sources to demand centers, and distribution lines that connect individual customers. The US electric power system has provided highly reliable electricity for more than a century.

      1.2.1 Traditional Power Grid Architecture

The traditional architecture (see Figure 1.1) is based on large‐scale generation remotely located from consumers, hierarchical control structures with minimal feedback, limited energy storage, one‐way control, and passive loads.

Figure 1.1 Traditional electricity delivery system.

      Source: [DOE 2015a]. Public Domain.

      As illustrated in Figure 1.1, the electricity sector is composed of four distinct functions: generation, transmission, distribution, and system operations. Once electricity is generated, it is generally sent through high‐voltage, high‐capacity transmission lines to local electricity distributors. Once there, electricity is transformed into a lower voltage and sent through local distribution lines for consumption by industrial plants, businesses, and residential consumers.

Because electric energy is generated and consumed almost instantaneously, the operation of an electric power system requires that a system operator constantly balance the generation and consumption of power. Figure 1.2 shows additional functional systems (transmission system, system operations, distribution system) and substation connected to different customers (offices, residential customers, and industrial customers). Information including basic definitions of terms and concepts related to the electrical power grid can be also found in the references and glossaries included in Appendix B.

Figure 1.2 Functions of the electricity sector.

      Source: [GAO 2011]. Public Domain.

      1.2.1.1 Key Players

      In the US electric sector, the key players include utilities and system operators [GAO 2011]:

       Utilities own and operate electricity assets, which may include generation plants, transmission lines, distribution lines, and substations including structures often seen in residential and commercial areas that contain technical equipment such as switches and transformers to ensure smooth, safe flow of current and voltage. Utilities may be owned by investors, municipalities, and individuals (as in cooperative utilities).

       System operators are sometimes affiliated with a particular utility or sometimes independent and responsible for managing the electricity flows in multiple utility areas. The system operators manage and control the generation, transmission, and distribution of electric power using control systems, IT information systems, and network‐based systems that monitor and control sensitive processes and physical functions, including opening and closing circuit breakers (see definitions in Appendix B). Therefore, the effective functioning of the electricity industry is highly dependent on these control systems.

However, for many years, the US electricity network lacked opportunities such as [GAO 2011]:

       Adequate technologies (e.g. sensors) to allow system operators to monitor how much electricity was flowing on distribution lines.

       Communication networks to further integrate parts of the electricity grid with control centers.

       Computerized control devices to automate system management and recovery.

      1.2.1.2 Electric Grid Design of the Future

      As the electric grid transitions from the traditional design to the design of the future, new features and technologies must be incorporated. Increasing communications and computing capabilities are transforming power grid from the traditional centralized model to an integrated hybrid centralized/decentralized system. Therefore, society and the power industry in particular are challenged by the transformation of the power grid, as introduced by Nikola Tesla about 120 years ago, into a Smart Grid.

Figure 1.3 depicts an electric power grid that is evolving to include more distributed control, two‐way flows of electricity and information, more energy storage, and new market participants including consumers as energy producers.

Figure 1.3 Evolution of the electric power grid.

      Source: [DOE 2015a]. Public Domain.

      1.2.2 Smart Grid Definitions

The definition of a Smart Grid is broad and encompasses many aspects of electric grid operation and management. A Smart Grid is an improved electrical power grid, a network of transmission lines, substations, transformers, and more that deliver electricity from suppliers to consumers by using two‐way digital technology to communicate with end loads and appliances at industrial, commercial, and residential premises to save energy and reduce capital and operational cost by improving reliability, security, and efficiency of current power grid. The Smart Grid enables greater use of electricity generated from renewable resources.

      Smart Grids are typically described as electricity systems complemented by communication networks, monitoring and control systems, smart devices, and end‐user interfaces [OECD 2010], [OECD 2009].

      Another Smart Grid definition blends both functions and components [OECD 2012b] and refers to an electricity network that uses digital and other advanced technologies to monitor and manage the transport

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