U.S. President Donald Trump declared a national emergency over foreign supply of bulk-power system electric equipment, citing risks that foreign actors could create or exploit vulnerabilities in equipment supporting U.S. national defense, emergency services, critical infrastructure and the economy. In a Wednesday order, the administration said the growing dependence on reliable electricity driven by advanced manufacturing, data centers, artificial intelligence and defense production has increased potential consequences of an attack or supply disruption.
The executive order directs the Energy Secretary to restrict certain transactions involving foreign-produced bulk-power equipment and associated software, firmware, digital services and remote-access capabilities linked to covered foreign entities when they pose risks of sabotage, unauthorized access, supply disruption or catastrophic effects on U.S. critical infrastructure. It also allows conditions to be imposed on existing equipment, including requirements to identify, isolate, monitor, secure, disconnect, replace or remove equipment deemed an unacceptable national security risk.
“As President of the United States, my highest duty is protecting the national security, foreign policy, and economy of this country. Certain foreign actors are increasingly creating and exploiting vulnerabilities in the United States bulk-power system, which provides the electricity that supports our national defense, vital emergency services, critical infrastructure, and economy,” President Trump wrote in Executive Order 14420.
“During my first term, I found that the bulk-power system could be a target of those seeking to commit malicious acts against the United States, including malicious cyber activities, because of the significant risks that a successful attack would have on our economy, human health and safety, and national defense,” Trump highlighted. “Since my first term, the threat to the United States regarding foreign supply of bulk-power system electric equipment has become even more acute: The rapid growth of advanced manufacturing, data centers, artificial intelligence, and defense production has increased the Nation’s dependence on abundant, reliable electricity and magnified the consequences of a successful attack or supply disruption on the bulk-power system.”
The EO 14420 recognizes that minimal restrictions on acquisition or operation in the U.S. of foreign-produced bulk-power system electric equipment augment the ability of some foreign entities to create and exploit vulnerabilities in such equipment; for instance, such equipment might have digital backdoors built into their systems that allow a foreign country to access that equipment remotely. Further, continued U.S. reliance on foreign sources of bulk-power system electric equipment with these potential national security vulnerabilities also creates a supply chain vulnerability that could eliminate the supply of these products in the U.S. due to disruptions in international trade or other causes.
To deal with this threat, EO 14420 laid down couple of measures to protect security, integrity, and reliability of bulk-power system electric equipment used in the U.S. The order prohibits acquisition, importation, transfer or installation of foreign-produced bulk-power system electric equipment in the U.S. when the transaction involves property in which a foreign country or national has an interest, the transaction was initiated after the order’s date, and the secretary of Energy determines that the equipment or associated critical components, software, firmware, digital services, maintenance services or remote-access capabilities were designed, developed, manufactured or supplied by persons owned by, controlled by or subject to the jurisdiction or direction of a Covered Foreign Entity.
The prohibition applies when such transactions pose an undue risk of sabotage, subversion, unauthorized access, malicious remote action or supply disruption affecting the design, integrity, manufacturing, production, distribution, installation, operation or maintenance of the U.S. bulk-power system. It also applies when transactions pose an undue risk of catastrophic effects on the security or resilience of U.S. critical infrastructure or the economy, or otherwise pose an unacceptable risk to U.S. national security or the security and safety of U.S. persons.
After making these determinations, the Secretary of Energy, in consultation with the Secretary of War, the Secretary of Commerce, the Secretary of Homeland Security and the Director of National Intelligence, may impose conditions on continued use, operation, maintenance, servicing or updating of foreign-manufactured or operated bulk-power system electric equipment acquired or installed before the order. These conditions may require organizations to identify, isolate, monitor, secure, disconnect, replace or remove such equipment. Before directing isolation, disconnection, replacement or removal, the Secretary must consider effects on reliability and safety, the availability of secure replacements and continuity of essential service, and may establish phased compliance.
Under provisions of EO 14420, the Energy Secretary may also design or negotiate measures to mitigate concerns identified in the order, including measures that could serve as a precondition for approving a transaction or class of transactions that would otherwise be prohibited. The prohibitions apply except where provided otherwise by statutes, regulations, orders, directives or licenses issued under the order, and apply notwithstanding contracts entered into or licenses or permits granted before the order.
The secretary may establish criteria and procedures for recognizing particular equipment and vendors in the bulk-power system electric equipment market as pre-qualified for future transactions and therefore exempt from the prohibition. The secretary may also use those criteria to establish and publish a list of pre-qualified equipment and vendors, although the provision does not limit the secretary’s authority to prohibit or otherwise regulate transactions involving qualified equipment or suppliers.
The order also prohibits transactions that evade or avoid, are intended to evade or avoid, cause a violation of or attempt to violate any prohibition or requirement under the order. Any conspiracy formed to violate a prohibition or requirement under the order is also prohibited.
According to EO 14420, the Secretary is authorized to take actions necessary to implement the order, ordering replacement of equipment posing an unacceptable risk to national security, adopting appropriate rules and regulations, and using all other powers granted to the President under the International Emergency Economic Powers Act (IEEPA). The head of each agency is authorized and required to take appropriate measures within the agency’s authority to implement the order and may, consistent with applicable law, redelegate that authority.
Rules and regulations issued under the order may determine that particular countries or persons are Covered Foreign Entities solely for the order, identify persons owned by, controlled by, or subject to the jurisdiction or direction of a Covered Foreign Entity, identify particular equipment or countries involving bulk-power system electric equipment that warrant additional scrutiny, and establish procedures for licensing transactions that would otherwise be prohibited. Within 120 days of the order’s date, the Secretary, in consultation with the Secretary of War, the Secretary of Homeland Security, the Director of National Intelligence and other senior executive branch officials as appropriate, shall publish rules or regulations implementing the authorities delegated under the order as needed.
As soon as practicable, the Secretary, in consultation with the Secretary of War, the Secretary of the Interior, the Secretary of Commerce, the Secretary of Homeland Security, the Director of National Intelligence and other senior executive branch officials as appropriate, shall identify bulk-power system electric equipment designed, developed, manufactured or supplied by persons owned by, controlled by or subject to the jurisdiction or direction of one or more Covered Foreign Entities that poses an undue risk of sabotage or subversion to the design, integrity, manufacturing, production, distribution, installation, operation or maintenance of the U.S. bulk-power system.
This includes equipment that poses an undue risk of catastrophic effects on the security or resilience of U.S. critical infrastructure or the U.S. economy, or otherwise poses an unacceptable risk to U.S. national security or the security and safety of U.S. persons. The Secretary shall also develop and submit to the President, through the Assistant to the President for National Security Affairs, recommendations on ways to identify, inventory, isolate, monitor or replace such equipment as soon as practicable, taking into consideration the overall risk to the bulk-power system.
Within 180 days of the order’s date, the EO 14420 called upon the Secretary, in consultation with the Federal Acquisition Regulatory Council (FAR Council) and other senior executive branch officials as appropriate, shall develop and submit recommended revisions to the Federal Acquisition Regulation (FAR) to ensure that national security risks are adequately considered in federal procurement involving energy infrastructure and to prioritize the acquisition of U.S.-manufactured energy infrastructure. Within 90 days of receiving the Secretary’s recommendations, the FAR Council shall consider proposing amendments to applicable FAR provisions for notice and public comment to implement those recommendations.
Recognizing some of the expected challenges from EO 14420, Patrick Miller, president and CEO of Ampyx Cyber, wrote in a blog post that something this broad usually gets tested, and the 2020 order never really was because it lapsed before there was a rule to argue about. “The pressure points here mostly follow from what’s already above. Section 2(b) is the obvious one, given how thin the foreign interest looks in a transformer that’s been paid for and energized for a decade, and given that Congress wrote Section 215A to cover emergency directives to infrastructure owners with conditions attached. The state questions in the earlier section are the other likely source, and those will probably arrive through commissions and trade associations rather than through a court.”
Identifying that the definitional edges look contestable too, Miller wrote that “’Subject to the jurisdiction or direction of’ a covered government is undefined and does most of the work in deciding whether a manufacturer is in scope, and ‘initiated’ sets the boundary of the forward prohibition without appearing in the definitions section at all. Section 7(c) says the order creates no enforceable right, and there’s no notice and comment step, so the first practical venue for most of this is probably a challenge to whatever DOE publishes in December rather than to the order itself. None of which is a reason to plan around a challenge succeeding, and I wouldn’t build a compliance posture on the assumption that a provision goes away.”
Miller also called on organizations to take several steps before Dec. 24. Because the rules have not yet been written, anything organizations build now should be useful regardless of what the final requirements say. Organizations should extend their equipment inventory below the CIP asset list to include everything at 69 kV and above, as well as battery energy storage, grid-connected inverters and uninterruptible power supply systems supporting critical infrastructure. They should record the country of manufacture, country of design and controlling parent of the manufacturer as three separate fields because the order treats them as separate questions.
Additionally, organizations should also re-sort their CIP-003-9 Section 6 vendor access inventory by manufacturer ownership rather than by who holds credentials. This represents the single largest gap between existing inventories and what the order will require. Organizations should document the initiation date of every pending procurement now, with supporting evidence, while records are fresh. The forward prohibition turns on transactions initiated after Aug. 26, 2026, and the term ‘initiated’ is not defined. They should also review the change-in-law, force majeure and assignment clauses in open supply agreements. Section 2(d) applies the prohibitions notwithstanding any prior contract.
Organizations should walk through the CIP change management process for a hypothetical forced replacement of a relay or remote terminal unit (RTU) from end to end and identify where the process could break before an external party sets the schedule. They should also monitor Department of Energy (DOE) orders, not only formal rules. The 120-day rulemaking mandate is qualified with ‘as needed,’ and the 2020 experience involved a prohibition order rather than a regulation. Nothing has been issued by the Department yet, making its own pages an important place to monitor.
Finally, organizations should track 22 C.F.R. 126.1 as a live document rather than relying on a snapshot.
In July, the Department of War suspended CMMC Phase II, pausing the requirement for contractors to undergo third-party C3PAO assessments, a move that brought relief on compliance timelines. But the suspension was procedural, not substantive: Phase I self-assessment obligations remain in effect, NIST SP 800-171 cybersecurity requirements continue to flow down the defense supply chain, and underlying security mandates embedded in existing contracts stay intact. The DoD launched a 60-day review to make the program more scalable and accessible to small and medium-sized contractors, essentially hitting pause on third-party verification while keeping the security requirements live.
