Test

Supply Chain Security, Resilience & Industry Trends

EPRI Supply Chain Model

Executive Summary

Supply chains have become a strategic focus area for utilities and critical infrastructure operators. Globally sourced hardware, software, and connected technologies introduce cybersecurity, operational, and geopolitical risks that can impact reliability, resilience, and business operations.

At the same time, utilities are investing in advanced visibility and decision-support capabilities including Artificial Intelligence (AI), Supply Chain Control Towers, Digital Twins, and supplier-risk monitoring. These capabilities help organizations improve situational awareness, identify disruptions earlier, and strengthen long-term resilience.

Area	Potential Impact
Reliability	Equipment shortages, supplier outages, and logistics disruptions can affect maintenance schedules, project timelines, and grid modernization efforts.
Cybersecurity	Third-party technologies may introduce new attack surfaces, software vulnerabilities, and unauthorized access pathways.
Operations	Limited visibility into suppliers and dependencies can delay the identification and resolution of operational disruptions.
Resilience	Organizations require the ability to anticipate, withstand, and recover from changing operational, geopolitical, and market conditions.

---

Key Supply Chain Risks

Technology & Asset Assurance

Recent industry assessments have highlighted the importance of understanding communications protocols, data flows, vendor connectivity, and remote access capabilities associated with modern energy technologies.

Examples include:

• Cellular communications modules
• Wi-Fi connectivity
• Bluetooth interfaces
• Vendor remote-access capabilities
• Undocumented communications pathways

Why It Matters

For utilities, uncertainty surrounding deployed technologies can complicate asset management, cybersecurity monitoring, incident response, and overall operational awareness. The challenge is often less about a specific technology and more about understanding exactly what has been deployed and how it communicates.

Software Supply Chain Risk

Modern utility operations depend on software vendors, cloud providers, embedded firmware, open-source components, and third-party integrators.

A compromise of a trusted software supplier can potentially affect multiple organizations simultaneously. As software ecosystems grow increasingly complex, visibility into software dependencies becomes more important.

EPRI's Technical Assessment Methodology (TAM) emphasizes evaluating attack surfaces, identifying security gaps, and validating security controls throughout technology deployments.

Geopolitical & Supplier Risk

Global supply chains remain vulnerable to geopolitical developments, manufacturing concentration, transportation constraints, and evolving trade regulations.

Examples include:

• Trade restrictions and tariffs
• Export controls
• Semiconductor shortages
• Critical mineral dependencies
• Transportation disruptions

These events can affect equipment availability, increase lead times, and delay infrastructure investments across the utility sector.

Common Supply Chain Risk Drivers

Risk Area	Examples
Cybersecurity	Third-party compromise, ransomware, software supply chain attacks
Technology	Undocumented communications, firmware integrity concerns, unsupported products
Geopolitical	Export controls, tariffs, regional instability
Logistics	Shipping delays, port disruptions, inventory shortages

---

Supply Chain Cybersecurity

As utilities continue their digital transformation efforts, cybersecurity considerations increasingly extend beyond organizational boundaries and into supplier ecosystems.

Industry supply chain security programs focus on understanding software integrity, vendor access, communications pathways, and architectural risks before technologies are deployed.

EPRI's Defensible Network Architectures guidance provides criteria for securely deploying operational technologies and reducing exposure to unauthorized access pathways.

Leading Practices

• Supplier cybersecurity assessments
• Software Bills of Materials (SBOMs)
• Hardware Bills of Materials (HBOMs)
• Vendor access reviews
• Multi-Factor Authentication (MFA)
• Network segmentation
• Continuous supplier monitoring

---

Artificial Intelligence in Supply Chains

AI-Enabled Supply Chain Analytics

Artificial Intelligence is helping organizations move beyond reactive supply chain management by improving forecasting, disruption analysis, inventory planning, and supplier-risk identification.

Current applications include:

• Demand forecasting
• Inventory optimization
• Supplier risk monitoring
• Predictive maintenance
• Transportation optimization
• Procurement analytics

As supply chains become increasingly complex, digital tools are being adopted to improve operational awareness and support planning activities across utility operations.

Emerging Trend: Agentic AI

Industry leaders are evaluating AI systems capable of performing approved actions on behalf of supply chain personnel. Potential applications include supplier evaluation, inventory balancing, logistics optimization, and disruption-response activities.

While still emerging, Agentic AI is expected to become a major area of investment over the next several years.

---

Supply Chain Visibility & Control Towers

Supply Chain Control Tower

A Supply Chain Control Tower provides a centralized view of suppliers, inventory, logistics networks, external risks, and operational dependencies.

Rather than relying on disconnected data sources, organizations can monitor critical supply chain activities from a single operational picture and identify disruptions earlier.

The same industry drivers accelerating adoption of digital twins, advanced analytics, and operational visibility platforms are also increasing demand for comprehensive supplier awareness and dependency mapping.

Capability	Business Value
Real-Time Visibility	Improves awareness of inventory, suppliers, shipments, and operational dependencies.
Risk Monitoring	Identifies supply chain disruptions, supplier issues, and emerging risks earlier.
Decision Support	Enables faster and more informed operational and procurement decisions.
Executive Reporting	Provides leadership with a consolidated view of supply chain performance and risks.

---

Digital Twins & Scenario Planning

Digital Twins create virtual representations of suppliers, transportation networks, inventory, and operational dependencies.

These environments allow organizations to evaluate potential disruptions before they occur and better understand downstream operational impacts.

As utilities adapt to increasing levels of inverter-based resources, distributed energy resources, and interconnected technologies, advanced modeling and simulation capabilities are becoming essential tools for planning, resilience analysis, and operational decision-making.

Common scenarios include:

• Supplier failures
• Transportation disruptions
• Severe weather events
• Equipment shortages
• Grid modernization delays

---

Recommendations

Area	Recommended Actions
Procurement	Require SBOMs and HBOMs, assess supplier security practices, review remote-access capabilities, and validate vendor security programs.
Visibility	Maintain supplier inventories, map critical dependencies, improve traceability, and understand technology communications pathways.
Monitoring	Continuously assess supplier risks, geopolitical developments, software vulnerabilities, and emerging threats.
Security	Eliminate default credentials, implement MFA, restrict remote access, validate firmware integrity, and segment networks.

---

Emerging Trends

Utilities continue to monitor several technologies and practices that may significantly influence future supply chain operations, resilience, and risk management.

Industry Watchlist

High Priority	Emerging Areas
Agentic AI Supply Chain Control Towers Digital Twins Software Supply Chain Security Third-Party Risk Monitoring	Autonomous Logistics Robotics IoT Asset Tracking Digital Product Passports (DPPs)

Digital Product Passports (DPPs)

Digital Product Passports are emerging as a mechanism for improving product traceability and lifecycle transparency. Driven largely by international regulatory initiatives, DPPs may influence future procurement, supplier reporting, asset lifecycle management, and supply chain visibility programs.

---

EPRI Resources

• EPRI Supply Chain Assessment Research Program
• EPRI Security Design Architecture Review: Solar Inverters (3002029720)
• EPRI Technical Assessment Methodology (3002012752)
• EPRI Defensible Network Architectures: Criteria for Secure OT Deployment in Power Systems (3002027430)
• EPRI Inverter-Based Resources and Grid Interconnection Research Area

Related Topics

• Inverter-Based Resources (IBRs)
• Battery Energy Storage Systems (BESS)
• Supply Chain Cybersecurity
• Operational Technology (OT) Security
• Digital Twins
• Artificial Intelligence
• Supplier Risk Management
• Grid Modernization