Renewables’ Cybersecurity Risk: A Growing Concern

TLDR:

Investors in the renewable energy sector should be aware of the unique cybersecurity risks that come with it. Kenny Boyce of Third Party Cyber Security discusses these risks, including operational technology vulnerabilities and potential consequences of cyber attacks. Due diligence processes should include digital reconnaissance, cybersecurity testing, and interviews with staff. Contractual protections should be included in sales and purchase agreements. Risks also extend to generative AI, where assumptions about security can lead to inaccurate data. Post-acquisition, integration plans should be risk-based, and ongoing cybersecurity assessments are crucial to maintain security. Legal requirements are increasing in the renewables sector, emphasizing the importance of cybersecurity. To mitigate risks on the sell side, companies should document cybersecurity measures, regularly test systems, and stay up to date on cyber threats.

Full Article:

As investors flock to the renewable energy sector, Kenny Boyce of Third Party Cyber Security joins the podcast to share some surprising risks in the space. Renewable energy M&A has been a hot topic in recent years, with 2024 predicted to be a banner year for private equity clean energy and renewables dealmaking. Boyce emphasizes the importance of cybersecurity due diligence in assessing the risks within potential portfolio companies and post-deal to ensure that investments do not degrade due to poor cybersecurity.

Key points discussed include:

• Operational technology vulnerabilities in the renewable energy sector
• The consequences of cyber attacks on energy creation, storage, and transportation
• Recommended due diligence processes, including digital reconnaissance, cybersecurity testing, and staff interviews
• Contractual protections in sales and purchase agreements
• Risks associated with generative AI and assumptions about security
• Post-acquisition integration plans and ongoing cybersecurity assessments
• Increasing legal requirements in the renewables sector
• Recommendations for mitigating risks on the sell side, including documentation of cybersecurity measures and regular testing of systems