Two recent federal government actions have highlighted national security concerns related to the nation’s power grid. First, on May 1, 2020, President Donald Trump issued an executive order that will likely lead to restrictions on the procurement and use of electric equipment from certain foreign adversaries for use in the U.S. power grid. Second, on May 4, 2020, Secretary of Commerce Wilbur Ross announced the initiation of a Section 232 investigation into whether certain transformer components used in electrical power grids are being imported in quantities that threaten national security.

Key Notes:

  • By executive order, the secretary of energy is now authorized to review and block any acquisition, importation, transfer or installation of any bulk-power system electric equipment in which a foreign country or foreign person has an interest.
  • A list of prohibited suppliers of electric equipment may be forthcoming.
  • In addition, a Section 232 investigation has been initiated into transformers and certain components, which may result in increased tariffs on these items.

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