Delivering on the Promise of Clean Energy

This is an excerpt of the original article. It was written for the January-February 2010 edition of Supply Chain Management Review. The full article is available to current subscribers.

January-February 2010

As the search for news forms of energy intensifies, supply chain professionals are presented with an unprecedented challenge and opportunity: To apply their managerial and analytical skills in delivering this energy to the end consumers. How effectively they respond may ultimately determine whether—and when—the promise of green energy finally gets fulfilled.

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The surge in green energy investments is the modern equivalent of the Gold Rush. Researchers and entrepreneurs are exploring new frontiers from the windy Great Plains to the sunny Southwest in search of the mother lode. And like the original rush, this one is dominated by the challenges of turning a natural resource into a commercial proposition. However, an important part of very effort to deliver new forms of energy has been largely overlooked: the vital role of supply chain management.

Not even supply chain professionals are fully aware of the need to apply the analytical and managerial skills they routinely deploy to the delivery of green energy. For example, renewable resources such as wind and solar are, by nature, intermittent and located far away form consumer demand. In other words, the supply chain is often in the wrong place at the wrong time. Supply chain professionals have been addressing these mismatches for as long as their profession has existed.

For understandable reasons, the green energy effort is centered on how to generate supplies and on consumer applications such as hybrid or fuel cell vehicles. But before green energy can become a viable alternative to fossil fuels, we need to address the issue of how it can be delivered reliably and cost effectively to end consumers. This is where the supply chain comes in.

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