Internal Supply Chain Coordination in the Electric Utility Industry
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.
Optimal control, Electric utilities, Supply chain management, Econometrics
Computer Sciences | Operations Research, Systems Engineering and Industrial Engineering
Information Systems and Management
European Journal of Operations Research
FORGIONNE, G. and GUO, Zhiling.
Internal Supply Chain Coordination in the Electric Utility Industry. (2009). European Journal of Operations Research. 196, (2), 619-627. Research Collection School Of Information Systems.
Available at: http://ink.library.smu.edu.sg/sis_research/1861