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Reducing cost of energy in the offshore wind energy industry: The promise and potential of supply chain management

Jan Stentoft (Department of Entrepreneurship and Relationship Management, University of Southern Denmark, Kolding, Denmark)
Ram Narasimhan (Department of Supply Chain Management, Eli Broad Graduate School of Management, Michigan State University, East Lansing, Michigan, USA)
Thomas Poulsen (Department of Mechanical and Manufacturing Engineering, Aalborg University, Copenhagen, Denmark)

International Journal of Energy Sector Management

ISSN: 1750-6220

Article publication date: 6 June 2016

Abstract

Purpose

To support ongoing industry efforts to reduce the cost of energy (CoE) of offshore wind compared to other types of energy sources, researchers are applying scientific models and thought processes to identify potential areas of improvement and optimization. This paper aims to introduce a conceptual framework from a supply chain management (SCM) perspective, aimed at promoting the reduction of CoE in the offshore wind energy industry.

Design/methodology/approach

Using conceptual arguments from current academic literature in SCM, a comprehensive framework is presented that clarifies how SCM practices can be used by offshore wind energy industry to reduce CoE.

Findings

The offshore wind energy sector is a young industry that must reduce CoE to compete with other forms of energy. Applying a supply chain perspective in the offshore wind industry has hitherto been limited to the academic community. This paper offers a SCM framework that includes three interdependent aspects of reducing CoE – innovation, industrialization and supplier partnering – to guide the industry towards sources to reduce CoE.

Research limitations/implications

SCM is a broad research area; thus, the presented framework to reduce the CoE is open for further development.

Practical implications

The paper provides insights into how the CoE can be reduced through innovation, industrialization and partnering in the offshore wind energy supply chain.

Originality/value

The paper offers a seminal contribution by introducing a SCM framework to understand sources and approaches to reduce CoE in the offshore wind energy industry.

Keywords

Citation

Stentoft, J., Narasimhan, R. and Poulsen, T. (2016), "Reducing cost of energy in the offshore wind energy industry: The promise and potential of supply chain management", International Journal of Energy Sector Management, Vol. 10 No. 2, pp. 151-171. https://doi.org/10.1108/IJESM-04-2015-0001

Publisher

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Emerald Group Publishing Limited

Copyright © 2016, Emerald Group Publishing Limited