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Why does cyber deterrence fail and when might it succeed? A framework for cyber scenario analysis

Through cyberattacks on information technology and digital communications systems, antagonists have increasingly been able to alter the strategic balance in their favor without provoking serious consequences. Conflict within and through the cyber domain is inherently different from conflict in other domains that house our critical systems. These differences result in new challenges for defending and creating resilient systems, and for deterring those who would wish to disrupt or destroy them. The purpose of this paper is to further examine the question of whether or not deterrence can be an effective strategy in cyber conflict, given our broad and varied interests in cyberspace. We define deterrence broadly as the creation of conditions that dissuade antagonists from taking unwanted actions because they believe that they will incur unacceptably high costs and/or receive insufficient benefits from taking that action. Deterrence may or may not be the most credible or effective strategy for achieving our desired end states in cybersecurity. Regardless of the answer here, however, it is important to consider why deterrence strategies might succeed under certain conditions, and to understand why deterrence is not effective within the myriad contexts that it appears fail. Deterrence remains a key component of U.S. cyber strategy, but there is little detail on how to operationalize or implement this policy, how to bring a whole-of-government and whole-of- private-sector approach to cyber deterrence, which types of antagonists can or should be deterred, and in which contexts. Moreover, discussion about how nations can and should respond to significant cyber incidents largely centers around whether or not the incident constitutes a "use of force," which would justify certain types of responses according to international law. However, we believe the "use of force" threshold is inadequate to describe the myriad interests and objectives of actors in cyberspace, both attackers and defenders. In this paper, we propose an approach to further examine if deterrence is an effective strategy and under which conditions. Our approach includes systematic analysis of cyber incident scenarios using a framework to evaluate the effectiveness of various activities in influencing antagonist behavior. While we only examine a single scenario for this paper, we propose that additional work is needed to more fully understand how various alternative thresholds constrain or unleash options for actors to influence one another's behavior in the cyber domain.

45 MILITARY TECHNOLOGY, WEAPONRY, AND NATIONAL DEF↗

Scaling Equitable Finance

Driven by dramatic declines in up-front cost, the U.S. solar photovoltaics (PV) industry has taken off over the past decade, growing from 1 gigawatt of installed capacity in 2009 to 89 gigawatts in 2020—or enough capacity to power roughly 19 million homes. The industry is expected to double in size over just the next 5 years.1 Much of the growth has been driven by large, utility-scale projects that can produce 5 mega- watts or more of power—enough to power at least 1,000 homes. The cost of electricity produced by these projects has decreased by more than 70 percent since 2010. As of Q3 2020, development costs of large, util- ity-scale solar PV power plants were under $1 per watt, down by more than 70 percent from 2010.2 A robust array of investors has come forward to efficiently deliver capital to these kinds of utility-scale projects including large banks, insurance companies, pension funds, and others. But low- and moderate-income communities, including communities of color, are at risk of being left behind in the transition to clean energy. Mission- driven solar project developers and financial institu- tions have been working alongside energy justice advocates to open up solar access for these communi- ties, using strategies ranging from community solar, to solar installations on affordable multifamily housing, to distributed solar and storage programs, and more. Their goals go beyond simply generating more green energy to advancing social equity by: • empowering communities to control their energy future • stabilizing energy prices, saving money, and build- ing wealth for low-income families • creating quality jobs • improving health by reducing pollution • providing energy resilience for vulnerable communities Mission-driven actors are successfully deploying a wide variety of strategies to meet these goals, from helping low-income homeowners get solar—and some- times battery storage, to developing solar projects serv- ing affordable rental housing and community facilities, to building larger “shared solar” projects to which households from across the community can subscribe. However, the financing ecosystem does not work nearly as well for these “mission driven” solar proj- ects as it does for utility-scale projects. For home rooftop solar, even if low-income consumers have a home and suitable roof, they may fail to qualify for federal tax incentives, lack adequate credit to qualify for a loan—or the mission-driven lenders seeking to serve them may not be adequately capitalized to make long-term loans. For mission-driven commercial or community-scale projects, assembling nearly every component of the project capital stack—whether bridging early-stage costs, attracting tax credit equity investors, securing long-term debt, or coming up with sponsor equity and filling gaps—can present challenges. A variety of obstacles contribute to the scarcity of financing for low-income solar, including small project sizes, lack of developer balance sheet capacity, both real and perceived issues with credit risk, elevated technical assistance needs, and greater subsidy requirements to pursue goals such as deep energy affordability, climate resilience, or job creation. Still other obstacles are regulatory: for example, not all states allow community solar projects or Power Purchase Agreements, common strategies used for providing low-income solar—and the potential for regulations to shift over time creates risks that mission-driven projects can ill afford. This report synthesizes information garnered from 47 key informant interviews, four focus group discus- sions involving 60 stakeholders, and a review of the substantial existing literature on low-income solar finance to assess the current landscape of mission- driven solar development in the United States, examine the roles that community-based financial institutions could play, and recommend public invest- ments and policy changes that could help to scale the provision of equitable solar finance. Key recommen- dations for policymakers and funders in the renew- able energy and community development fields that emerge from this process include the following: • Help to capitalize and support community-based lenders to provide flexible, low-cost, and long- term financing to mission-driven solar projects— including providing guarantees or other forms of credit enhancement. • Provide federal support for equitable solar, including a grant-in-lieu-of-credits option for the Investment Tax Credit to improve access to this critical government subsidy. • Develop pools of government and philanthropic support that can complement financing from community-based lenders to complete the capi- tal stack for mission-driven projects, as well as to support education and technical assistance to both consumers and potential project sponsors. • Create a national Renewable Energy Credits pro- gram that includes social equity targets to provide a baseline of support for clean energy generation. • Change utility regulations to remove barriers to low-income solar projects; lower permitting costs; provide greater certainty for developers, consumers and owners; and measure progress toward equity in renewable energy policy implementation.

14 SOLAR ENERGY↗