Guest Column | July 14, 2023

Securing IoT Devices In The Utilities Industry: Best Practices And Emerging Trends

GettyImages-1146418707 Cadence IoT

Most consumers nowadays use smart lights, smart TVs, webcams, fitness trackers, and other devices powered by the Internet of Things (IoT). These products communicate with each other over the internet, streamlining tasks that would otherwise require human intervention. For example, some robot vacuums or dishwashers connect to Wi-Fi, allowing users to control them via an app.

The number of IoT devices should reach 29 billion by 2027. This technology disrupts entire industries, leading to higher efficiency and lower costs. The utility sector is no exception, with industry leaders like National Grid, E.ON, and American Water using IoT to collect and monitor data in real time.

Utility companies deploy IoT sensors and similar devices to reduce carbon emissions, preserve natural resources, and forecast demand. This practice also allows them to deliver a better customer experience, generating higher revenue. But, for many enterprises, securing their IoT devices against physical attacks and cyber threats is one of the biggest challenges.

The Role of IoT in the Utilities Industry

IoT plays a key role in the utility sector, helping companies optimize resource allocation. Utility providers can leverage this technology to streamline energy, water, and gas generation, remote surveillance and monitoring, business security, workforce management, and other processes.

For example, water companies use IoT devices for leak detection and proactive maintenance. This practice allows them to minimize water losses and reduce infrastructure damage. They may also deploy IoT sensors to measure water pH, turbidity, chlorine levels, and other parameters. The sensors collect real-time data, enabling users to optimize water distribution and minimize waste.

On the other hand, electricity providers can use IoT to create smart grids.

These energy networks allow more efficient electricity transmission, reduce power restoration times, and improve security. They also integrate smart meters and other IoT devices that enable real-time energy monitoring. Utility providers and their customers can use this data to improve energy usage, detect energy losses, and cut costs.

All in all, IoT allows utility companies to transform traditional infrastructures into intelligent systems and make better use of their resources.

The result? Higher efficiency, proactive maintenance, enhanced sustainability, and cost savings. These factors can improve a company's bottom line and drive revenue growth.

But to reap the benefits, utility providers must first address the challenges of IoT adoption and deployment, such as data security.

IoT Security Risks And Challenges

While IoT brings numerous advantages to the utility industry, it also poses significant challenges.

These include, but are not limited to:

  • Regulatory and legal challenges
  • Security and privacy risks
  • Poor asset management
  • Data overload
  • Connectivity issues
  • Interoperability issues
  • Limited battery life

Of particular concern is the fact that IoT devices are naturally vulnerable to cyber threats.

For example, hackers can exploit Domain Name System (DNS) vulnerabilities to install malware on these devices. The risk is even higher for companies using legacy systems along with IoT.

Other security threats are related to data encryption. According to a 2020 report, 98% of all network traffic from IoT devices is unencrypted, increasing the risk of data breaches.

Additionally, nearly 60% of IoT devices are susceptible to medium- or high-severity attacks. For instance, cybercriminals can launch zero-day attacks to compromise routers, webcams, smart security cameras, or entire IoT systems.

IoT devices may also become targets for botnet attacks or malware infections. Once compromised, they can be used as entry points for unauthorized access into utility networks, allowing hackers to manipulate or disrupt essential services.

Another problem is utility providers often deploy their IoT devices in remote locations. This practice leaves them vulnerable to theft, tampering, or unauthorized physical access.

It's also worth mentioning that many IoT developers overlook security. As a result, their products have unpatched vulnerabilities stemming from hardware limitations, outdated components, insecure data transfer, poor default settings, and other issues.

While several ways exist to address these risks, utility companies must establish a data governance framework.

How Data Governance Can Improve IoT Security

Understanding data governance is the first step to securing your IoT devices and systems. Think of it as a set of processes and standards that ensure data accuracy, reliability, and security from start to finish.

All enterprises, including utility providers, need data governance. They must establish how data is gathered, processed, stored, and used throughout its life cycle. Companies must also determine who can access what data and under what circumstances.

In cybersecurity, data governance encompasses the procedures and policies defining how an organization will build, use, and manage its IoT systems. It also outlines how those devices and systems will comply with the laws governing data security, such as the General Data Protection Regulation (GDPR). These actions are meant to identify and address data security and privacy challenges.

An IoT governance framework should cover data management, information security, and technical architecture. Each area requires insights from legal experts, data analysts, IoT developers, and other professionals.

This process is complex and resource-intensive, but the benefits are worth it. A solid data governance framework can reduce costs, mitigate risks, and improve decision making. Most importantly, it enables utility providers to detect suspicious activities, unauthorized access attempts, and potential security breaches early on, minimizing the risk of legal repercussions.

IoT Security Best Practices For Utility Providers

IoT and IIoT (industrial IoT) devices collect massive amounts of data, including sensitive information. If this data is compromised, it can result in hefty fines, lawsuits, and reputational damage. As a manager or business owner, it's your responsibility to identify and mitigate such risks.

The steps to protect your IoT ecosystem should support your data governance efforts and business goals.

That said, here are some of the best practices to mitigate IoT security threats.

Devise A Robust IoT Security Program

First things first, develop a strategy to secure your IoT environment. Start with a risk assessment to document your IoT assets, vulnerabilities, and potential threats.

Next, lay out the steps you'll take to address the risks associated with every business process that uses the organization's IoT network. For best results, focus on the following areas:

  • Authentication
  • Encryption
  • System updates

Establish clear policies for each of these areas to mitigate risks at the network and device levels. Let's see a few examples:

  • Set access controls for your IoT networks
  • Segment your networks
  • Regularly update firmware
  • Automate IoT asset inventory management
  • Employ real-time IoT monitoring
  • Implement a vulnerability scanner

 Next, take the steps needed to secure the data collected by your IoT devices. For instance, you'll need to encrypt this data, secure its storage, and perform backup and recovery tests.

Apply Network Segmentation

Utility companies can and should apply network segmentation to secure communications between IoT devices. This practice may prevent unauthorized access and limit the potential impact of a compromised device. It's one of the first steps to securing an IoT network.

You need to divide your network into multiple subnets for better traffic control between designated zones. Afterward, you can set up group zones based on specific criteria (e.g., their geographic location) and implement different security measures for each.

If one or more devices are compromised later, the rest of your network will remain secure. This approach also can boost network performance while protecting sensitive data from insiders, remote users, and hackers.

Use Strong Authentication Methods

Most companies, including utility providers, are vulnerable to insider and external threats.

The former may come from current or former employees, contractors, vendors, and other parties.

As far as external threats are concerned, 10.7% of cyberattacks targeted the energy sector in 2022. About 19% of utility companies were attacked by botnets, whereas 15% dealt with ransomware or business email compromise (BEC).

Given these risks, using strong encryption and authentication methods to protect your IoT devices makes sense.

First, determine who can access each device and network and under what conditions. After that, implement authentication protocols like digital certificates and signatures, one-time passwords, and role-based access control (RBAC).

Consider the following options, too:

  • Secure tokens or smart cards
  • Two-factor authentication (2FA)
  • Multi-factor authentication (MFA)
  • Biometric authentication (e.g., facial recognition or fingerprint scanning)
  • Secure key exchange protocols
  • Device-to-device authentication

 For example, companies can enable mutual authentication between IoT devices themselves. This practice ensures that only authorized devices can communicate with each other, preventing unauthorized access or tampering. Similarly, key exchange protocols help secure communications between IoT devices and backend systems.

Implement Access Control Technologies

As mentioned earlier, utility providers often place their IoT devices in remote areas, which can increase physical security risks. Video monitoring alone isn't enough to prevent theft, unauthorized access, and other incidents.

Go one step further and leverage access control technologies to secure your IoT system. These may include access control lists (ACLs), certificate-based authentication (CBA), cryptographic keys, password-protected gates, and more.

Another solution is role-based access control (RBAC). This technology allows you to restrict users' access to specific IoT devices or networks based on their organizational role. Utility companies can define roles, such as administrators, IoT developers, or maintenance personnel, and assign access rights to each group.

Enterprises also can use network access control (NAC) systems to enforce access policies at the network level. This practice ensures that only authorized devices with compliant security settings can connect to the IoT network.

Be Prepared For Security Events

Regarding IoT security, it's impossible to eliminate all risks. Therefore, you need to keep your guard up and develop an incident response plan. But since this process can be very complex, it's best to start small by implementing some incident response mechanisms upon which you can improve.

The first step is to build a dedicated team to handle IoT security incidents. It should consist of individuals with technical expertise in network security, cloud technologies, communications, software development, and other relevant areas.

Next, define the roles and responsibilities of each team member and ensure appropriate access to the necessary tools. Establish a framework for categorizing incidents based on severity and impact, run simulations, and establish clear escalation procedures.

Having a remediation and recovery process in place is just as important. This step involves identifying and implementing the right solutions, restoring data from backups, and updating security controls, among other measures.

Last, conduct post-incident reviews to identify areas for improvement. Determine what you did well and could have done better and adjust your approach as needed.

Prioritize IoT Security Training

You may use these business organizer apps to keep your workplace efficient as an employer. That's great, but workplace efficiency is multifaceted and requires in-depth knowledge of the devices and systems used by your team members.

If your organization relies on IoT, you must ensure your employees understand its intricacies. This technology has been around for decades, but it's constantly changing and evolving. Therefore, it's important to train and upskill your team continuously.

IoT security training can increase efficiency across teams and departments, reduce human error, and lower the risk of security incidents. Your employees will better understand and adhere to security policies, identify attack vectors, and prevent data breaches. Plus, they will avoid costly mistakes, such as using outdated firmware or clicking on phishing links.

Conduct regular IoT security training sessions to ensure continuous learning for the best results. Cover relevant topics like network security, device configuration, IoT attacks, cryptography, cloud threats, and incident response. Keep your staff engaged through interactive training methods like workshops, simulations, hands-on exercises, and problem-solving activities.

Keep Up With The Latest IoT Security Trends

IoT is a dynamic field, with new challenges and opportunities always emerging. For this reason, enterprises must keep up with the latest IoT security trends and incorporate them into their operations.

In 2023, we can expect to see an increase in the number of IoT devices using security by design. These products have built-in security features to minimize cyber-related risks compared to their previous versions. For example, some IoT devices come with embedded SIMs instead of pluggable SIM cards, which may help prevent tampering.

Moreover, the United Nations and other global organizations are taking a bigger role in cybersecurity. According to Information Week, IoT devices will be more strictly regulated and, hence, safer.

 The rise of artificial intelligence (AI), digital twins, 5G technology, and edge computing is shaping the IoT sector, too.

 For instance, 5G networks support stronger authentication and encryption than previous technologies. Additionally, they allow for network slicing, which involves dividing the network into multiple virtual networks tailored for specific uses. This segregation can help reduce the attack surface and limit the impact of security breaches if one device is compromised.

 Utility companies can leverage these trends to better secure their IoT networks. However, note that these technologies pose specific challenges, such as the need for new equipment.

Secure Your IoT Ecosystem To Drive Business Growth

Staying ahead of cybercriminals is increasingly difficult in today's interconnected world. IoT devices are particularly vulnerable to botnets, firmware hijacking, malware, eavesdropping, and other cyber threats, posing additional challenges for utility companies.

On the positive side, there are steps you can take to secure your IoT ecosystem. First, establish a data governance framework that aligns with your organizational goals. After that, develop a robust IoT security program and train your team.

Cover the basics and then move on to more advanced security measures. Run simulations, seek areas of improvement, and adjust your strategy along the way. Remember to turn off unused devices, implement access controls, and protect your data at every level.

About The Author

Andra Picincu is a digital marketing consultant and copywriter with over 12 years of experience, covering various sectors, notably those with a strong emphasis on technology and operational efficiencies. Her broad spectrum of work spans from businesses heavily relying on digital interfaces to those embracing the rapid evolution of IoT. Her work has supported businesses from startups to large organizations, driving growth and enhancing brand awareness. Known for her ability to translate complex industry topics into compelling narratives, her expertise has fostered a global audience.