Trump Declares a National Emergency Over Foreign-Made Grid Equipment and Bans Its Purchase Under Emergency Economic Powers

Trump signed Executive Order 14420 on Aug. 26 declaring a national emergency over the foreign supply of bulk-power system electric equipment, invoking the International Emergency Economic Powers Act and the National Emergencies Act. The order prohibits any acquisition, importation, transfer or installation of foreign-produced grid equipment where the Energy Secretary determines the supplier is owned by, controlled by or subject to a "Covered Foreign Entity" and the transaction poses an undue risk. It also lets the Secretary impose conditions on equipment already installed, including requirements to isolate, disconnect, replace or remove it.

IEEPA was written for foreign-threat sanctions, and using it to regulate domestic procurement of transformers, breakers and control systems extends emergency economic authority into ordinary infrastructure purchasing. The order defines "Covered Foreign Entity" broadly enough that the Energy Secretary can add countries or firms by determination, without further congressional action.

Implementing rules are due within 120 days, and recommended Federal Acquisition Regulation revisions within 180 days. The order directs recurring reports to Congress under the National Emergencies Act and IEEPA, and applies notwithstanding contracts or permits granted before its date.