NIS2 and Energy: Powering Up Cybersecurity Compliance

The stakes couldn’t be higher. That’s why NIS2 is raising the bar with stricter requirements designed to make energy infrastructure more resilient and better protected against today’s growing cyber threats.

But what does this mean for energy companies? How should oil producers, refineries, electricity grids, and energy distributors prepare for compliance? And what are the consequences of falling short?

 In this article, we’ll break down what NIS2 means for the oil and energy sector, the biggest cybersecurity challenges companies are facing, and some practical steps you can take to stay compliant while keeping operations running smoothly.

The NIS2 Directive and Energy: A Critical Sector in the Spotlight

Under NIS2, energy is classified as an “essential entity”. This applies to oil producers, natural gas suppliers, electricity generation facilities, and transmission system operators. These organizations form the backbone of Europe’s economy and national security, making them prime targets for sophisticated cyber criminals, including state-sponsored groups.

Energy systems are particularly attractive for attackers because:

• Disruption Equals Leverage: A successful cyberattack on an oil pipeline or power grid doesn’t just impact one company, it destabilizes entire regions. Ransomware groups and hostile actors know they can exert massive pressure by threatening outages or fuel shortages.
• Legacy Systems & OT Risks: Many energy infrastructures still rely on outdated operational technology (OT) systems that were never designed with cybersecurity in mind. Attackers exploit these weak points to gain control of physical processes.
• Supply Chain Complexity: Oil and energy companies often work with a variety of contractors and third-party providers, expanding the attack surface and increasing risks of infiltration.

Being classified as an “essential entity” under NIS2 means non-compliance isn’t an option. Organizations that fail to meet the directive’s standards face severe financial, legal, and operational consequences.

What Are the Consequences of Non-Compliance?

For energy providers, the risks of ignoring NIS2 are substantial:

• Hefty fines: Up to €10 million or 2% of annual global turnover, whichever is higher.
• Personal accountability: Executives and IT security leaders may be held liable for negligence in implementing adequate protections.
• Operational disruptions: A single cyberattack can halt oil refinery operations, shut down pipelines, or cause blackouts, impacting millions.
• Reputational fallout: Loss of customer trust and damaged relationships with governments and regulators.

The message is clear - failing to comply is not just a regulatory issue, it’s a critical business risk.

Cybersecurity Challenges in Energy & NIS2 Compliance

1. Protecting Operational Technology (OT)

Unlike IT systems, OT environments directly manage physical processes. Many of these systems were built decades ago and lack built-in security.

Solution: Network Segmentation & OT Security

• Isolate OT systems from IT networks to reduce attack propagation.
• Deploy intrusion detection systems (IDS) tailored for industrial protocols.
• Conduct regular OT-specific penetration testing.

Use Case:
In 2021, a ransomware attack forced the shutdown of a major US oil pipeline. A lack of proper segmentation between IT and OT environments played a key role. By adopting strict segmentation and industrial IDS, energy operators can prevent similar large-scale disruptions.

2. Identity & Access Management (IAM)

Thousands of employees, contractors, and field engineers require access to sensitive energy systems. Without proper control, excessive privileges can easily be exploited.

Solution: Role-Based IAM with Just-in-Time Access

• Grant employees only the access they need, when they need it.
• Automate revocation when contracts end or roles change.
• Implement Single Sign-On (SSO) across IT and OT platforms.

Use Case:
An oil refinery introduced an IAM system with role-based access control (RBAC) and automatic offboarding. Insider threat risk dropped significantly, and compliance audits became faster and more transparent.

3. Strong Authentication & MFA

Password-only logins are a common weak spot, especially in field operations where mobile devices are used.

Solution: Multi-Factor Authentication (MFA) & Passwordless Options

• MFA tokens for engineers accessing remote OT networks.
• Biometric authentication for control room operators.
• Passwordless authentication with FIDO2 keys for corporate IT users.

Use Case:
An energy distributor facing repeated phishing attempts deployed hardware tokens for staff with privileged accounts. This move virtually eliminated credential theft attacks.

4. Incident Response & Resilience Planning

Under NIS2, energy companies must report incidents within 24 hours and prove that they have robust incident response (IR) plans.

Solution: Incident Response Framework & Continuous Monitoring

• Establish 24/7 Security Operations Centers (SOCs).
• Conduct tabletop exercises simulating OT attacks.
• Integrate threat intelligence into monitoring platforms.

Use Case:
A European power grid operator now runs quarterly red team exercises against its SOC (Security Operations Centre). The drills uncovered vulnerabilities in its supply chain, which were addressed before attackers could exploit them.

5. Digital Certificates & PKI for Critical Systems

Energy companies depend on reliable and secure communication between control centers, field equipment, and supply chain partners. If attackers tamper with or impersonate these connections, the consequences can be severe.

Solution: PKI-Based Security for Critical Infrastructure

• Device Authentication: Use digital certificates to ensure that only trusted equipment (e.g., smart meters, sensors, SCADA components) can connect to critical networks.
• Data Integrity & Confidentiality: Secure data exchanged between control centers, substations, and remote field units through encryption.
• Certificate Renewal Automation: Make sure that expired certificates don't get in the way of your operations running smoothly.

Why it matters:
In the energy sector, attackers may try to inject false data, send unauthorized commands, or impersonate legitimate devices. PKI helps close these gaps by making sure that every device and communication channel is verified and protected.

Additional Cybersecurity Solutions for Energy Under NIS2

• Endpoint Security for Field Devices: Protect laptops, tablets, and IoT devices used in oilfields and power plants.
• Supply Chain Security: carefully analyze third-party vendors and enforce minimum security standards for contractors.
• Employee Cyber Awareness: Regular training to help staff recognize phishing and social engineering attacks.

NIS2 as a Guide for Stronger Cybersecurity in Energy

The energy sector is one of the most important parts of Europe’s everyday life. That’s why NIS2 is such a big deal, it’s not just another set of rules. It’s about keeping fuel, electricity, and other essential services running safely.

By putting things like Multi-Factor Authentication (MFA), Identity and Access Management (IAM), stronger protection for operational technology (OT), and clear incident response plans in place, energy companies can both meet the new requirements and make themselves harder targets for cyberattacks.

Don’t wait. Taking steps now to protect energy systems will help keep people safe, businesses running, and critical services available for years to come.

How ASEE Can Help

Dealing with NIS2 in the energy sector can seem complicated, but you don’t have to figure it out by yourself. ASEE can support you with solutions like IAM, MFA, OT security, and incident response to help you meet the rules and keep your operations safe.

Contact us to us and let’s get started on your NIS2 compliance journey in the oil and energy industry.