The renewable energy industry continues to grow as the world looks for ways to reverse climate change and reliance on fossil fuels. With a growing need for renewable energy sources, the supply chain that supports the production and distribution of renewable energy is challenging. There are many solutions like solar panels, wind turbines, and energy storage systems that continue to evolve as new technologies advance. Here are some of the key components of the renewable energy supply chain and the challenges the industry faces.
Components of the Renewable Energy Supply Chain
- Raw Materials: Extracting raw materials like lithium, cobalt, and other rare earth elements like neodymium, iron, and boron are critical for renewable energy. Batteries need lithium and cobalt, while wind turbine magnets are made from rare elements like neodymium and samarium cobalt.
- Manufacturing: To produce renewable energy solutions like solar panels or wind turbine blades, manufacturers need to source products like silicon wafers, inverters, and control systems from global suppliers. Production of these items also requires engineering expertise.
- Transportation: Moving wind turbine blades, bulky equipment, or delicate components like solar cells requires specialized logistics. Shipping these components can often involve multiple forms of transportation when shipping around the world, with many large-scale projects located in remote areas.
- Installation: Installing renewable energy systems often involves heavy machinery, highly skilled labor, and coordination between many teams. There can be ancillary construction needed onsite based on the system being used, like building a foundation for a wind turbine or a mounting system for solar panels.
Challenges in the Renewable Energy Supply Chain
Mining raw materials like lithium or rare earth elements can be challenging considering where the materials are located. Any regional disruption can cause a ripple effect in the supply chain. There is a lot of pressure on the industry to ensure ethical sourcing and reducing environmental impacts. With the demand for renewable energy growing each year, another challenge is supply chain capacity, which can cause delays or cost increases for certain materials. Government policy and tariffs are also a concern for manufacturers, with new policies impacting costs or resources.
What’s Next for Renewable Energy Supply Chains
As renewable energy demand continues to grow, the supply chain plays a crucial role in meeting the global energy goals. There is a need for collaboration between manufacturers, suppliers, and government entities to ensure a more sustainable future. By facing challenges and finding new ways to innovate, the renewable energy supply chain can continue to deliver components that will create a cleaner future. Gexpro Services is a key supplier in the Renewable Energy market, providing supply chain solutions for the wind, solar, and energy storage markets. We provide made-to-print fabrications, critical B and C class components, specialty fasteners, and more. Talk to our team today about our supply chain management solutions customized for your business.