This paper considers the security of sensor network applications. Our approach creates multicast regions that use symmetric key cryptography for communications. Each multicast region contains a single keyserver that is used to perform key management and maintain the integrity of a multicast region. Communications between two multicast regions is performed by nodes that belong to both regions. To ease the network management burden, it is desirable for the networks to self-organize into regions and dynamically select their keyservers. This paper shows how to determine the number of keyservers (k) to use and the size in the number of hops (h) of their multicast regions. We find that power consumption issues provide a natural trade-off that determines optimal values for these parameters. Analysis of one application shows an increase in system security with 70-80% less power overhead than existing security approaches.