Internal supply chain coordination in the electric utility industry

Guisseppi Forgionne and Zhiling Guo

European Journal of Operational Research, 2009, vol. 196, issue 2, 619-627

Abstract: Electric utilities have a well-established vertical internal and external supply chain. Theoretically, information sharing, involving production, inventory, and other policy variables, between chain entities can improve supply chain performance. Such sharing relies on a systematic determination of the optimal policy variables for the chain. This paper presents an analysis of the electric utility's decision problem based on an optimal control model in a competitive market environment. Optimal production and inventory policies are developed for a centralized supply chain under full information sharing. The model and policies are tested with electric utility industry data, and performance implications are discussed for electric utility managers and public regulators.

Keywords: Optimal; control; Electric; utilities; Supply; chain; management; Econometrics (search for similar items in EconPapers)
Date: 2009
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Citations: View citations in EconPapers (3)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:ejores:v:196:y:2009:i:2:p:619-627

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