The prize was for Dr Oughton’s research quantifying the vulnerability of electricity networks from cyberattacks. The prestigious Lloyd’s Science of Risk prizes are awarded to esteemed academics and PhD students who, through their published scientific work, further the understanding of risk and insurance.
Dr Oughton discussed how the research helps identify:
- How to quantify future risks for which we have no effective historical record
- What opportunities and risks cyber-physical attacks on Critical National Infrastructure (CNI) pose for the insurance industry.
He identified how underwriters of business interruption insurance can adapt the risk framework developed in the stochastic counterfactual risk analysis to specifically assess their own balance sheet exposure. “Our research paper can provide the technical foundations needed for actuarial modelling to inform pricing and risk management of this opportunity,” explains Dr Edward Oughton. “Critical national infrastructure such as smart electricity networks are susceptible to malicious cyberattacks which could cause substantial power outages and cascading failure affecting multiple business, health and education organisations as well domestic supply,” he adds.
The research, “Stochastic Counterfactual Risk Analysis for the Vulnerability Assessment of Cyber-Physical Attacks on Electricity Distribution Infrastructure Networks”, published in Risk Analysis journal, shows conservative scenarios ranging from £20.6 million for a four-substation electricity event to £111.4 million for a 14-substation electricity event. Even though the research focused on conservative scenarios, the paper demonstrates that 1.5 million people would be affected even by a relatively small attack.
Until Edward and fellow researchers carried out this study, little was known about the effects and costs of cyber-physical attacks on electricity networks. Cyber-physical systems increasingly monitor infrastructure through smart energy and smart transport systems and are proving to be a point of failure which many people previously thought impermeable. Dr Oughton explains, “Cyberattacks are on the increase and gathering data to help model the effects of such cyber-physical attacks is essential to develop risk analytics for emerging threats and cascading failure across Critical National Infrastructure (CNI).”
Co-authors: Daniel Ralph, University of Cambridge, Raghav Pant, University of Oxford, Eireann Leverett, Waratah Analytics /University of Cambridge, Jennifer Copic, University of Cambridge, Rabia Dada, University of Cambridge, Scott Thacker, UNOPS / University of Oxford, Simon Ruffle, University of Cambridge, Michelle Tuveson, University of Cambridge, and Jim Hall, University of Oxford.
At the time the research was carried out Dr Oughton was part of the UK Infrastructure Transitions Research Consortium (ITRC) at the University of Oxford and the Centre for Risk Studies at the Cambridge Judge Business School, he is now Assistant Professor at George Mason University.