Securing DER Communications: What Every Utility Telecom Team Should Know

DER Growth Brings New Security Pressures

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Distributed Energy Resources (DERs) are reshaping the electric grid, adding flexibility, enabling renewable integration and decentralizing generation. But every new solar array, battery system, or a microgrid system also opens another doorway into the utility network. Especially without a standard across your DER sites.

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‍For utility telecom and cybersecurity teams, this isn’t just about adding bandwidth or signal coverage. It’s about DER security and keeping the same standards you have always had, while being able to scale, without adding pain to the commissioning process and work for an overworked staff.

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How do you bring DERs online quickly and securely? Do your DER sites meet your utility’s security requirements? What is the plan once the DER space grows to be a significant portion of the grid? Do you have a resilient grid?

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Why DER Cybersecurity Plays by Different Rules

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raditional cybersecurity for the power grid assumed centralized, utility-owned gear inside a secure perimeter on a few legacy generation projects over an entire career. DER integration breaks that model.

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With DERs, utilities face:

• Third-party ownership – Developers and EPCs arrive without a full understanding of utility security protocols.
• No Standard  – Developers and EPCs want to be connected to the grid. If you don’t have standards, even developers and EPCs with the best intentions may not be able to meet your guidelines. .
• New Stakeholders – Every site might have a different requirement for internal stakeholders to access data. Gone are the days of SCADA only. Now we need to plan for a future that involves DERMs, regional system operator guidelines and internal business folks. ‍
• More entry points – You wouldn’t let your neighbor plug their equipment in your home network. Why would you let a developer plug their equipment into your grid?

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DER communications require zero trust. Every path is assumed to be hostile. Peace comes through authentication, encryption, and monitoring.

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The Regulatory Backbone: Applying NERC CIP Principles

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The North American Electric Reliability Corporation’s Critical Infrastructure Protection (NERC CIP) security standards were designed for big Bulk Electric System assets, and their principles increasingly apply to DERs. 

In aggregate, DERs are the new Big Bulk Electric System, estimated to be around 30% of total grid generation by 2030. Even if your DER sites aren’t under formal CIP rules yet, applying CIP-style controls now avoids expensive retrofits later.

Relevant CIP areas:

• CIP-003 – Security management controls
• CIP-005 – Electronic security perimeters
• CIP-007 – System security management

Key practices for data security in DER environments:

• Encrypted tunnels for all control and monitoring data
• Strong device-to-control-center authentication
• Network segmentation to isolate DER traffic
• Logging of overall system performance and auditing enabled on hardware

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SCADA Security in the DER Era

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Most DER sites still talk in plain text. DNP3, Modbus, and other legacy protocols don’t encrypt by default. That’s no longer acceptable. Sure, you can wait for DNP protocol and devices to catch up, but that is hard to explain when a breach occurs.

Field challenges we see:

• Disparate Hardware – DER sites want to get online in the most economic way possible. That means they bring their own hardware and expect you to invest staff time integrating it.
• Device Hardening – If you are going to be responsible for the devices, you should have the tools to harden them.
• Practicality  vs. Security – There can be both. You can have robust communications with encryption and a practical solution within arms reach. 

Build encryption and authentication into the network layer so operators don’t feel it and commissioning timelines don’t get longer.

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Recurring Weak Spots from Real Deployments

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In Loopback’s utility projects, a few issues show up time and again. One is security through obscurity. Nothing is defined or standardized, so what you don’t know can’t hurt you.

It’s a bit like traffic cones: they only stop people who were never going to cause trouble in the first place. A couple more bumps we encounter on site can be:

• Developer-owned internet links – Unknown risk profiles, no utility oversight.
• Custom onboarding for each site – 100+ unique network diagrams and configs.
• No central monitoring – Outages and anomalies spotted too late.
• Old firmware – Devices left years behind on patches.

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Building a Secure DER Communications Backbone

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1. Lock down the transport layer

1. Skip the public internet, use private cellular or dedicated links.
2. IPsec, GRE over IPsec, or DMVPN for end-to-end encryption.
3. Mutual certificate-based authentication to block rogue devices.

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2. Standardize the site build

• One approved edge cabinet design with pre-vetted routers, firewalls, RTUs, or industrial PCs.
• Preconfigured to utility standards before hitting the field.
• Future-proof against DERMS uncertainty: a single, flexible spec simplifies adaptation when new requirements emerge.
• No need for reinventing the wheel every project. Use one communications spec for all developers.

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3. Monitor and respond fast

• Centralized telemetry for every site.
• Automated outage and anomaly alerts.
• Incident response playbook with timelines, responsibilities, and escalation paths.

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4. Plan for hardware resilience

• NEMA 4X-rated enclosures for environmental protection.
• Battery backup aligned with ISO or equivalent requirements, with ongoing monitoring of regulatory changes.
• Professionally engineered panel drawings and control matrices delivered for each site.
• Spare gear is staged and configured for overnight shipment directly to developers, eliminating unnecessary truck rolls.

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The Operational Payoff

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A strong electric grid cyber security approach for DER comms doesn’t just protect, it speeds operations and streamlines broader power management solutions. Utilities that standardize and secure their DER comms report:

• Commissioning times cut from ~20 weeks to ~4
• 100+ core-team hours saved per site in coordination and troubleshooting
• Fewer truck rolls thanks to remote monitoring and overnight replacements
• Reduced audit risk with consistent compliance posture
• Less tension between engineering, telecom, and cybersecurity teams

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Case Insight: CMP & Avangrid

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CMP and Avangrid both landed on the same answer: a single, utility-controlled comms standard.

It delivers:

• Encrypted, utility-owned SCADA path for every DER site
• Elimination of 100+ custom network builds
• Commissioning timelines dramatically reduced
• Utility holds the root keys, while developer funds the CapEx

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Quick Checklist for Utility Teams

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Every new DER wave brings another round of designs, vendors, and risks. Use this checklist to make sure your communications plan is secure, standardized, and ready to scale before the next interconnection request hits your desk.

1. All DER comms encrypted in transit (IPsec, TLS, DMVPN)
2. Standard cabinet design provided to vendors
3. Centralized monitoring + automated alerts
4. Incident response timelines documented
5. Regular patch/firmware updates for all devices
6. DER network segmented from corporate IT
7. Clear hardware ownership model
8. NERC CIP-style review even if not required

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Security as a Strategic Advantage

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DER growth isn’t slowing. The utilities that control the communications path will onboard faster, reduce cyber risk, and integrate renewables more smoothly.
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How Loopback Fits In

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PowerWatch gives utilities a plug-and-play way to deploy secure, NERC-aligned DER communications at scale:

• Utility-controlled, customer-owned, Loopback-managed
• Encrypted private cellular backbone with no public internet exposure
• Standard cabinet design that’s brand-agnostic for RTU/industrial PC support
• 24/7 monitoring + overnight replacements

If you’re ready to secure DER comms, cut commissioning delays, and ditch one-off designs, let’s talk.

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