US Electrical Grid Dependent on China–Made Transformers

Attack on 9 substations could black out the whole country for an extended period of time, says expert

Tommy Waller, president and CEO of the Center for Security Policy. Lei Chen/The Epoch Times

“Every single way you look at it, modern society is not prepared to live without electricity,” says Tommy Waller, the president and CEO of the Center for Security Policy and an expert on the U.S. grid. He’s also featured in the documentary “Grid Down, Power Up.”

In a recent episode of “American Thought Leaders,” host Jan Jekielek and Mr. Waller discussed the vulnerabilities of the United States’ electrical grid, why the industry and our government have failed to correct these problems, and what happens if the grid goes down.

Jan Jekielek: In May 2020, President Trump signed an executive order declaring an emergency around the national grid. This happened after one of these large, high-voltage transformers in the grid made by a Chinese manufacturer was inspected by authorities. The results of that inspection are classified, but this grid emergency ensued. Tell us what happened.

Tommy Waller: On May 1, 2020, an executive order declared a grid security emergency. It recognized that our bulk power system has become dependent on certain countries hostile to the United States, including communist China. In this case, the transformer was seized by the federal government in 2019 and brought to Sandia National Laboratory, where it was inspected.

Many experts consider these extra-high-voltage transformers to be the backbone of our modern grid. If this device that we depend on for the lifeblood of our modern civilization could be manipulated or turned off, then that would be extremely problematic for us. It’s a vector of attack that the Trump administration tried to address through executive order. Unfortunately, on the first day of the current Biden administration, that executive order was suspended. Our nation has since imported about another 100 transformers from China. There are now somewhere around 400 in the U.S. grid.

When we say the grid, we’re talking about the whole system that generates electricity, transmits it, and distributes it. This transmission normally occurs over long distances. These extra-high-voltage transformers are needed to step up the voltage and then to bring it back down. It’s that high voltage that allows it to travel those long distances. These assets are absolutely critical.

If that transformer stopped working for any reason, then you’re not moving that electricity from where it’s produced to where it’s needed. The assets themselves, the large ones, may take years to produce. The lead time for that production has gone from about a year to more like four years, and there’s only so many of those assets. We can’t afford to lose them for any reason, whether it’s because they were manufactured with the malicious intent of manipulating them, or because they’re somehow attacked.

Mr. Jekielek: What does a situation look like where power goes down in a significant portion of the country?

Mr. Waller: In 1977, there was a 24-hour blackout in New York City. It was a natural form of an electromagnetic pulse [EMP], a lightning strike that hit a substation in New Jersey. In that 24-hour period, more than 4,500 looters were arrested, more than 550 police officers were injured in the line of duty, and there was over $300 million worth of damage in that city.

Think about our dependence on electricity. If you’re in an urban environment, you lose water right away. Refrigeration is critical to our food system, and that depends on electricity. Every single way you look at it, modern society is not prepared to live without electricity. In short order, you have suffering and chaos.

Mr. Jekielek: “Grid Down, Power Up” asserts that taking down just nine of these power stations or substations around the entire United States could result in a complete failure of the grid.

Mr. Waller: “Grid Down, Power Up” covers that, but it wasn’t the documentary that discovered this. It was actually the federal government, the Federal Energy Regulatory Commission [FERC], which oversees our bulk power system. This came in the wake of a physical attack and sabotage. In April 2013, a substation outside of San Jose [California] was attacked by a gunman.

FERC did a classified study in the wake of that attack. They discovered that if an adversary knew which nine substations to attack, this could cause cascading failures that could black out the whole country for an extended period of time. Some may remember the great Northeast blackout of August 14, 2003, when there was a cascading failure from a tree branch in Ohio striking a transmission line. That single point of failure caused a cascading blackout that resulted in 55 million customers losing power, some for up to two weeks. Whether it’s Mother Nature or a human adversary, the system can be taken down if it’s not properly protected.

Mr. Jekielek: How did we start importing these absolutely critical pieces of infrastructure?

Mr. Waller: In the same ways we as a nation came to depend on China for lots of different things. We know that the CCP [Chinese Communist Party] has been executing unrestricted warfare against the rest of the free world, predominantly the United States. One method of unrestricted warfare is looking for the critical vulnerabilities of a society and figuring out how to exploit them.

In this case, what the Chinese did was genius. They realized that these transformers need a certain type of steel to be manufactured, grain-oriented electrical steel. What do the Chinese do? They dumped into the market massive amounts of grain-oriented steel. They cornered the market for the precursors that are needed to create the transformers. I’m sure you and your viewers are familiar with the inexpensive aspect of purchasing products from China, which is made possible by slave labor, if you want to call it that.

Mr. Jekielek: By multiple factors, but yes.

Mr. Waller: Exactly. The CCP uses these different factors to corner the market on an asset that any modern civilization needs to survive. That put a lot of other manufacturers out of business. The utility industry has to make an investment in a transformer and asks, “What’s the price of these things?” Any investment is going to result in the utility spending money and all of us who pay electricity bills paying more, the more the utility spends. It’s understandable for them to look to save money. That’s one avenue that the Chinese used to get into that market by providing these transformers.

Today, our country needs to identify where these transformers are and get them inspected. Then we need to produce these domestically or else have our allies produce them while ensuring they are not using components from communist China.

Mr. Jekielek: How many have been inspected to date?

Mr. Waller: We know that one was inspected at Sandia National Laboratory. That’s all we know. We know that a president of the United States declared an emergency on May 1, 2020, so we know this is a big deal. The good thing is that even if the federal government isn’t moving as fast as it should, the states are waking up.

Texas, for example, has its own grid. The last legislative session passed the Lone Star Protection Act or Infrastructure Protection Act. It was designed to identify whether critical infrastructure components were coming from adversaries to make sure problems like this don’t happen in that state.

Mr. Jekielek: The cornering of the market for these high-voltage transformers is as much a military decision as it is a state business decision. An interview that came out later by an expert said they found something in this transformer that would allow it to be turned off remotely.

Mr. Waller: We imported this massive 500,000-pound electric transformer from China. They decided to send it to one of our national labs when it came into the country. They found hardware in it that had the ability for somebody in China to switch it off.

Mr. Jekielek: This is just one shocking way that the system can be compromised. But we also have other potential routes. Please give us a picture of these.

Mr. Waller: We talked about physical sabotage like what happened in California. We just saw this in North Carolina at the end of last year with rifle fire. There’s lots of different ways you can harm the grid: cyber attack, a localized electromagnetic attack, a directed energy weapon, or a nuclear electromagnetic pulse.

There will also be blackouts if we continue some of the policies of our government. You can’t shut down large baseload powered generators like nuclear, coal, and fossil fuel plants and replace them with renewables, when the sun only shines and the wind only blows intermittently, and at the same time electrify everything.

The grid is also vulnerable to threats from Mother Nature. It’s 100 percent certain that at some point the grid will go down because of solar weather. That’s a warning I’ve personally issued at least twice to Secretary of Energy Jennifer Granholm. So far, it doesn’t look like we’re doing what we need to do about it, even though it’s a completely fixable problem.

In fact, just this past March, there was a massive solar storm, and it happened to be on the opposite side of the sun. Had it traveled toward Earth, we might not be having this interview right now. The reason is that these highly charged particles react with the Earth’s magnetosphere. In fact, in the northern latitudes, people can see the Aurora Borealis, the Northern Lights, which is the visual depiction of the electromagnetic energy generated when these particles slam into our magnetosphere.

In 1921, there was a solar storm. They call it the railroad storm because there were railroad stations in Connecticut and throughout the Northeast that caught fire and burned to the ground. Why did they catch fire? Because the telegraph lines were 100-plus kilometers long and had ground-induced currents from a solar storm that caused sparks and fires.

Those currents go into our transformers. The level of protection we have from the current standards is so low that the grid will go down if we have a significant storm. When I say that it’s 100 percent certain, all I’m saying is that the level of protection we have now and the standards that have been set by the industry and approved by the government guarantee that the grid goes down if we suffer a solar storm of significant magnitude.

Mr. Jekielek: You would think they would care about this.

Mr. Waller: Some do. The people who keep the lights on in this country, they do. They provide for our survival every day. Unfortunately, when it comes to the rules that govern that industry, there are a lot of people who’ve been obstructing and lobbying against really reasonable, prudent, and affordable methods to protect this infrastructure.

Mr. Jekielek: Before we talk about those, tell me a little about yourself.

Mr. Waller: I felt a calling to serve in uniform since I can remember, and I was sworn into the Marine Corps on my 18th birthday. Eventually, I became a Force Reconnaissance Marine. It was a privilege to be part of that community. The Marines I served with are among the best in the nation.

I told myself I’d stay in until they kicked me out, and we reached that point. I took a stand on the COVID vaccine mandate, and unfortunately, along with many others, my religious accommodations were denied. I waited a year, I appealed, and did everything I could, but I was not allowed to continue serving.

I was also recruited at one point by the U.S. Air Force’s Electromagnetic Defense Task Force, to be a staff member of that organization and to help them form a task force to address electromagnetic spectrum threats, and to produce two reports on this issue that lay out the challenges.

I was blessed that during the last half of my career in the reserves, I had this civilian job with the Center for Security Policy, a nonprofit founded by Frank Gaffney, who worked for President Reagan. Frank knew all about nuclear EMP years before it was declassified. He’d been worried about the grid for decades.

This job is more than a job, it’s a calling in life. He taught me about electromagnetic pulse and about these threats. Then, he assigned me the duty of managing this nationwide Secure the Grid Coalition.

I’m not a physicist or an engineer. I’m an infantry guy. But I was blessed to be the apprentice to some of the world’s foremost experts in all of these different threats to this critical infrastructure. I was able to translate to the American people and to our policymakers the reality of those threats and what needs to be done to defend against them.

Mr. Jekielek: Please give me an overview of the specific grid-related threats that are coming from China. I know you see that as the biggest threat among the many you’ve just described.

Mr. Waller: If we adopt policies that rely on China to produce our transformers or the tens of thousands of inverters we need for our wind and solar technology, we are using markets cornered by China.

When we embrace policies that create a dependency on China, while at the same time creating vulnerabilities because we are not producing enough electricity, that’s one threat. The second one is cyber. We know that China has a significant cyber capability, and that can mean cyber espionage where they’re stealing secrets in our power production, whether it’s nuclear power or otherwise.

The supply chain we mentioned already. They could be producing different things with a hardware backdoor that would allow them to remotely control certain things. Then there is electromagnetic attack. We know that the Chinese are obviously nuclear-capable; it’s part of their war-fighting doctrine to focus on both that and cyber. Part of their cyber doctrine is the use of electromagnetic pulse.

Nuclear EMP is in the cards if they wanted to use that. We just watched a balloon cross the entire continental United States, and that balloon could be a platform for an EMP attack. It doesn’t take an intercontinental ballistic missile.

Then there’s the possibility of physical sabotage. Look at our open borders and our immigration policy with respect to the People’s Republic of China. If they put the right people here with the right know-how, they can conduct physical attacks on the grid.

Mr. Jekielek: Please tell us about the Secure the Grid Coalition. This is something that American citizens can get involved in.

Mr. Waller: Our Secure the Grid Coalition is a bipartisan group co-chaired by Ambassador Woolsey, who was President Clinton’s director of Central Intelligence, and by Newt Gingrich, former speaker of the House. We’ve got hundreds of members around the country.

We’re talking about a volunteer effort in the states and at the federal level to shape policies to protect this critical infrastructure. One valuable product of that effort has been “Grid Down, Power Up.” One of the members of the Secure the Grid Coalition, David Tice, sank an immense amount of money, time, and effort into the film. Dennis Quaid is the narrator. Now you’ve got David Tice and Dennis Quaid speaking all around the country because they care about this. But the film they produced, “Grid Down, Power Up,” is the culmination of nearly a decade of interviews of the experts in our coalition. I’ve been trying to brief policymakers for nine years, and this film can teach them in less than an hour.

The producer, on his website, GridDownPowerUp.com, created a tab called “participate.” You click on that tab and see all the policy recommendations that we’ve been promoting for years. Click on that, and you can get involved.

Mr. Jekielek: Apparently there are some easy ways to harden some of this infrastructure that aren’t that expensive.

Mr. Waller: Yes. Let’s take one example, the threat we can’t deter: the sun. We know it makes harmful ground-induced currents that can travel into certain vulnerable transformers. There are technologies out there like neutral ground blockers which can be applied to those vulnerable transformers.

If they were to install these neutral ground blockers on these transformers, analysis has shown they could solve that problem for the entire United States for just over $4 billion. This is what I explained to the secretary of energy regarding the bipartisan infrastructure bill, $1.2 trillion.

So one-third of 1 percent of that infrastructure bill could solve the problem of solar weather. Yet there’s no indication, despite multiple attempts, they’re spending the money on that.

Here’s another example. Your viewers can drive down the road and look at the substation that provides the lifeblood to that neighborhood with only a chain link fence around it. It should be ballistic protected to make sure these transformers can’t be shot up and can’t be viewed. It’s a fixable problem.

Mr. Jekielek: The viewers of this program might be thinking: “So, where is the hope? How can we change these large bodies that are doing things in this highly problematic way?”

Mr. Waller: The hope comes from the bottom up. Right now, for instance, there’s legislation in Texas authored by state Sen. Bob Hall that would create a commission that would analyze all these threats and decide how to address them, as opposed to depending on the federal government. There’s no reason why states can’t do that around the country.

Mr. Jekielek: Any final thoughts as we finish?

Mr. Waller: We need to be better prepared to live without electricity for as long as we can. We also need to get involved. The Participate tab at GridDownPowerUp.com gives every American the opportunity to do just that.

This interview has been edited for clarity and brevity.