Discuss about the Electric Vehicles and Smart Grid Interaction.
Supply chain management is the process that shows the flow of products, involves each movement and it manages storage of raw materials. It is related to the process of inventory and it compiles from moment of origins to point of consumption. In addition, making use of operation management resource, costing is not important as this is related to supporting operations. This process tells about managing human resources, equipment, building, materials and following supply chain management. This study is based on Macarthur Wind Firm and its integration process into state electricity grid. In the first part of the study, it shows the operation of the company on 24 hours basis. In addition, in the latter part, integration between logistics, operation and outbound logistics will be discussed based on Macarthur Wind Firm.
Macarthur Wind Firm is situated in Victoria near Hamilton. This firm is 260 km away from Melbourne. This firm has the capacity of making wind energy of 420 megawatts. Although, this is based on the capacity of wind speed and this estimation is based on average energy production. This firm can produce 1250 GWh in a year and capacity factor of operating is around 34% (Agl.com.au, 2017). This firm has an experience of 180 years and has almost 3.6 million customers in all over the Australia. The mission statement of Macarthur Wind Firm is to develop carbon constrained energy in future with building customer support system. This firm has 140 Vestas wind turbines that were manufactured in the country Denmark. This particular wind firm started its operation in the year 2015 and it cost approximately AUD 1 billion.
A business operation that is done in day-to-day basis is related to the employees' engagement to achieve profitability of a business. The main objective of a business is to grab sufficient income through its activities. Within an organisation, there are various business operations that need to do to run an organisation, staff function, line functions and value chain. In supply chain management, the organisation needs to focus on inbound logistics, process and outbound logistics (Peppard & Ward, 2016). Industry’s value chain is related to the raw materials, intermediate goods, manufacturing process, marketing and sales and after sales. This day to process is vertically integrated.
Inbound logistics is related to the arrangement of inbound movement of various equipment, materials and inventory from suppliers (Mwasilu et al. 2014). This is related to the assembling of plants, warehouse and various manufacturing products. This process is related to the value creating work of making wind power through wind mill. Materials that are needed in this process for Macarthur Wind Firm are steel, cast iron, aluminium, copper, carbon fibre, brass and fibre glass etc. This inbound logistics process is related to the project development, geotechnical services, transportation of materials and equipment, construction and operations and management.
Macarthur Wind Firm uses turbines to generate power and it requires a minimum wind speed of 16 km/h. this organisation has installed wind mill system with transmission capacity. Moreover, wind turbines look like an aircraft and it has propeller blades and that can generate electricity and it supplies electric current (Abdelhak, Grostick & Hanken, 2014). These wind turbines operate in various ways with a rotor, drive train and tower process. This current is stored in batteries and it can be utilized later supplying to various grids. This current is stored in above ground tanks; sometimes it stored underground caverns also.
Outbound logistics process can be defined as the movement of the final products to the end users. In this case, Macarthur needs to send wind energy to the end users that state grid system. Sometimes, power can be sent through substation, cables, towers, monopolies and accommodation platforms (Christopher, 2016). In addition, near shore wind energy can use trucking process if it is short distance as it is modular transport. Macarthur wind Firm uses the ports that need to be secure vast storage area with EPC (engineering, procurement and construction).
Linkages between Macarthur Wind Firm operations
In improving activities and performance of the operational activities, Macarthur Wind Firm wants to create linkages to customers and supply process. Macarthur sends the wind power to the grid of state. In this view, as stated by (Jacobs & Chase, 2013), a renewable energy organisation needs to view daily production and distribution planning. In addition, the organisation can track production scheduling of the manufacturing of supply chain. Demand planning is necessary as sourcing is important that includes inbound operations, transportation of supply receiving inventory (Monczka et al. 205). Production operation is also important for the firm that creates out bound logistics to fulfil the activities of transportation to customers. A strategic network of the supply chain can be optimized by Macarthur and that includes warehouse location, substation location with number and size of the distribution channel. Information technologies that are related to the infrastructure of an organisation can increase supply chain operation.
Wind Turbine manufacturers are responsible for supplying of wind turbines with structural manufacturers. In addition, Macarthur Wind Firm takes supply from electrical equipment supplies with cable supply. As Macarthur is a large organisation, it must have EPCI contractors. Distributed wind turbines produce electricity on the distribution grid for state electricity supply. The distribution process of wind energy of Macarthur Wind Firm:
First, wind turbine produces the electricity through tower, nacelle and blade. The second stage, energy comes in Collection Circuit and in next stage; the power comes to set up substation. In the following stage, the wind power comes to transmission (Slack, 2015). In the next stage, the power comes to step down substation and distribution is started to the state electricity.
Macarthur’s renewable energy demand increases and turbines sizes are also getting high. In this way, logistics and operation can reduce the cost. Highway underpass near Victoria creates issues in logistics and cranes are not always available for logistics (Guarnieri et al. 2015). In moving the electricity, Macarthur uses power network. In minimizing technical issues, the organisation uses High Voltage Direct Current (HVDC). The stability of power production can be increased through smart-grid with high power technologies. Macarthur creates power transmission link with 90 percent efficiency with high voltage levels. With this, in order to store the power, the organisation uses Lithium-ion battery in existing electrical network. Macarthur also uses EDF installation system in order to store energy and in grid loading. Macarthur uses HVDC light transmission to long distance as it is helpful in potential power sources. However, it can be deduced that power, risk reduction and benefits can significantly and positively impact on supply chain management. Power is identified with linkages with manufacturing the product with reduction of risk.
Sustainability within Macarthur Wind Firm precinct
Supply chain sustainability can be described as business issue that can affect an organisation’s logistic framework and supply chain of an organisation in terms of risk, environmental or waste costs. It is needed that organisation should integrate supply chain management that must be environmentally sound. In this sense, renewable energy producer Macarthur Wind Firm itself a sustainable power producer organisation that is going on economically, socially or environmentally correct way. Supply chain sustainability can provide long-term profitability of the organisation.
The resource-based view is a model that helps an organisation to understand strategic resources that are available for the firm (Bornemann & Wiedenhofer, 2014). These resources should be used by the firm in order to have sustainable development. Resources are all about capabilities and assets of organisation that must be used by the organisation in an efficient way. RBV is all about heterogeneous nature of the firm as key concept is VRIN model. The operation of an organisation must be unique with utilizing the potential key resources of the firm.
Valuable: These are the resources that enable Macarthur organisation to implement some strategies that develop their effectiveness and efficiency
Rare: These resources or equipment must not be available to competitors in operation or supply chain
Imperfectly imitable: These resources or management operation technique must not be implemented by another competitor
Non-substitutable: These techniques should not be replaced by other organisation using non-rare resources
For Macarthur organisation, they can follow three tiers of sustainability; the first one is of getting the basic right that should reduce carbon footprint. In the second stage, the organisation needs to think of sustainability through logistics and sustainability that can impact the local range of operation. Lastly, Macarthur organisation should follow the science of sustainability. Moreover, Macarthur organisation can build up IT cells to have technology friendly supply chain.
Macarthur Wind Firm organisation produces wind energy in Victoria that supplies wind energy with specific supply grid system. In the first stage, the organisation uses wind turbine and power comes in battery bank. Battery bank goes to an inverter and then the power goes to AC loads. Sourcing contracts and other purchasing decision with inventory management with quality of inventory is needed with transportation strategy. Moreover, distribution centre and production operation must be active for the organisation to be a sustainable organisation.
Abdelhak, M., Grostick, S., & Hanken, M. A. (2014). Health Information-E-Book: Managem. Abingdon: Routledge.
Bornemann, M., & Wiedenhofer, R. (2014). Intellectual capital in education: a value chain perspective. Journal of Intellectual Capital, 15(3), 451-470.
Christopher, M. (2016). Logistics & supply chain management. Sydney: Pearson UK.
Guarnieri, P., Sobreiro, V. A., Nagano, M. S., & Serrano, A. L. M. (2015). The challenge of selecting and evaluating third-party reverse logistics providers in a multi-criteria perspective: a Brazilian case. Journal of cleaner production, 96, 209-219.
Jacobs, R., & Chase, R. (2013). Operations and supply chain management. New Jersey: McGraw-Hill Higher Education.
Krajewski, L. J., Ritzman, L. P., & Malhotra, M. K. (2013). Operations management: processes and supply chains (Vol. 1). New York, NY: Pearson.
Macarthur Wind Farm | AGL. (2017). Agl.com.au. Retrieved 29 August 2017, from https://www.agl.com.au/about-agl/how-we-source-energy/renewable-energy/macarthur-wind-farm
Monczka, R. M., Handfield, R. B., Giunipero, L. C., & Patterson, J. L. (2015). Purchasing and supply chain management. Melbourne: Cengage Learning.
Mwasilu, F., Justo, J. J., Kim, E. K., Do, T. D., & Jung, J. W. (2014). Electric vehicles and smart grid interaction: A review on vehicle to grid and renewable energy sources integration. Renewable and Sustainable Energy Reviews, 34, 501-516.
Peppard, J., & Ward, J. (2016). The strategic management of information systems: Building a digital strategy. New Jersey: John Wiley & Sons.
Slack, N. (2015). Operations strategy. New Jersey: John Wiley & Sons, Ltd.