US Order Targets Foreign Electric Grid Equipment

A new executive order declares a national emergency to protect the U.S. electric grid from threats posed by foreign adversaries. The order authorizes the Secretary of Energy to establish a new regulatory regime restricting transactions involving “bulk-power system electric equipment” (BPSEE) sourced from designated foreign entities.

This action signals heightened federal scrutiny of critical infrastructure supply chains and could significantly impact energy companies, equipment manufacturers, and major electricity consumers. The order’s scope is broad, covering equipment from generation facilities to transmission control systems, and may even apply to previously installed components. While not self-executing, it directs the Department of Energy (DoE) to develop implementing regulations, which will likely include a licensing and mitigation process.

Counsel should monitor the forthcoming DoE rulemaking, which will define the scope of covered entities and equipment and establish procedures for compliance. Companies should also begin evaluating their supply chains for reliance on foreign-produced BPSEE to assess potential risks and prepare to engage in the public comment period for the new rules.