Government
Presidential Order Bans Use of Bulk-Storage Power Equipment from 'Certain Foreign Actors'
Claiming “vulnerabilities” in the U.S. bulk-power system are being exploited by “certain foreign actors," a new presidential order bars import of components produced in specific countries—mainly aimed at thwarting China's manufacturing dominance.
Rapid growth of advanced manufacturing, data centers, artificial intelligence and defense production in the U.S. has boosted power beeds and "magnified the consequences" of a ... "supply disruption on the bulk-power system,” the order stated.
In a move he has taken before based on grounds that are not proven or disputed, President Donald Trump declared a national emergency and prohibited the acquisition or installation of any bulk-power system equipment—such as transformers, or any critical component, software, firmware, digital service, maintenance service or remote-access capability associated with the equipment—"designed, developed, manufactured or supplied by a covered foreign entity" after Aug. 26.
In addition to China, Afghanistan, Belarus, Congo, Central African Republic, Cuba, Cyprus (through September 30, 2026), Eritrea, Ethiopia, Haiti, Iran, Myanmar, Iraq, Lebanon, Libya, Nicaragua, North Korea, Russia, Somalia, South Sudan, Sudan, Syria, Venezuela and Zimbabwe are considered “covered entities.”
The U.S. Dept. of Energy has 120 days to develop regulations to implement Trump’s order.
The bulk power system is made up of generating resources and high-voltage transmission equipment for the U.S. power grid. It does not include local distribution systems, which generally operate at lower voltages, according to the National Association of Regulatory Utility Commissioners.
Groups that represent American manufacturers support the measure. The order "elevates our shared goal of protecting America’s bulk-power system and the critical equipment and supply chains that enable it,” National Electrical Manufacturers Association President and CEO Debra Phillips said in a statement.
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The group says the U.S. electrical manufacturing industry has invested more than $200 billion in domestic production since 2019, advancing production of components critical to national security, economic growth and energy supplies going forward.
“Make It American is about more than where a product is made — it is about building the domestic manufacturing base, skilled workforce, and supply chains America needs to meet its needs,” she said, adding that the group "is eager to partner in growing the strong domestic electrical manufacturing base essential to meeting that demand and keeping America’s infrastructure secure.”
But the order could have sweeping implications that could insert more uncertainty into some energy projects, said Ryan Last, an attorney at law firm Troutman Pepper Locke, in comments to clean energy publication Recharge. “Developers must now price supply-chain uncertainty into procurement strategies, construction schedules, lender covenants and tax-equity assumptions from the earliest stages of project development,” he said.
In a blog post, Keith Martin, partner and co-head of projects at law Norton Rose Fulbright in Washington, D.C., said that following a similar Trump order in 2020, “some tax equity investors and lenders moved quickly to require developers to fund any future costs to replace equipment that the government decides is a threat to the grid." He added that "such provisions remain in many financing documents.”
Some construction lenders also started requiring developers to do cyber-security audits "to help show that projects are following best practices in case of government scrutiny.” he said.