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Revision as of 15:30, 4 November 2026
Supply Chain Security, Resilience & Industry Trends
Executive Summary
Supply chains have become a strategic focus area for utilities as equipment, software, and supporting services become increasingly connected and globally sourced. Recent industry assessments have highlighted the importance of understanding supplier dependencies, communications pathways, software provenance, and third-party access in order to maintain operational resilience and cybersecurity.
At the same time, utilities are investing in advanced visibility capabilities such as Supply Chain Control Towers, Digital Twins, and AI-enabled analytics to improve situational awareness and support more informed decision-making.
| Area | Potential Impact |
|---|---|
| Reliability | Equipment shortages, supplier outages, and logistics disruptions can affect maintenance schedules and capital projects. |
| Cybersecurity | Third-party technologies may introduce new attack surfaces and supply chain vulnerabilities. |
| Operations | Limited visibility into suppliers and dependencies can delay disruption response. |
| Resilience | Organizations need the ability to anticipate and adapt to changing market, geopolitical, and operational conditions. |
Industry Context
Historically, supply chain management was largely centered on cost, procurement, and logistics. Today, utilities increasingly view supply chains as critical business systems that directly influence reliability, security, and operational performance.
The rapid growth of inverter-based resources (IBRs), battery energy storage systems (BESS), cloud-connected platforms, and third-party service providers has expanded the number of external organizations and technologies that support utility operations. As a result, supply chain assurance is becoming a key component of enterprise risk management programs.
Key Supply Chain Risks
Technology & Asset Assurance
Recent industry assessments have demonstrated the importance of validating hardware, software, firmware, and communications capabilities throughout the asset lifecycle.
Organizations have identified concerns related to undocumented communications pathways, vendor remote access capabilities, and limited visibility into component origins.
Why It Matters
For utilities, uncertainty surrounding deployed technologies can complicate asset management, cybersecurity monitoring, and incident response activities. 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 a growing ecosystem of software vendors, cloud providers, open-source components, and embedded firmware.
A vulnerability or compromise within a trusted supplier can potentially affect multiple organizations simultaneously, making software supply chain security a major area of industry focus.
Geopolitical & Supplier Risk
Supply chains remain susceptible to geopolitical developments, manufacturing concentration, transportation constraints, and evolving trade regulations.
Events affecting semiconductor manufacturing, critical minerals, transportation corridors, or international trade can influence equipment availability and project timelines throughout the utility sector.
| 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 programs focused on supply chain security emphasize the importance of understanding vendor connectivity, software integrity, and third-party access pathways.
Organizations are increasingly strengthening their programs through:
- Supplier cybersecurity assessments
- Software Bills of Materials (SBOMs)
- Hardware Bills of Materials (HBOMs)
- Vendor access reviews
- Multi-Factor Authentication (MFA)
- Network segmentation
Artificial Intelligence in Supply Chains
Artificial Intelligence is helping supply chain organizations move beyond reactive management approaches toward predictive and data-driven operations.
Current implementations are commonly focused on forecasting, inventory optimization, supplier monitoring, and disruption analysis. Emerging solutions are beginning to support scenario planning and automated decision support.
Emerging Trend: Agentic AI
Industry leaders are evaluating AI systems capable of performing approved actions on behalf of supply chain personnel. Examples include supplier evaluation, inventory balancing, logistics optimization, and risk investigation workflows.
While still emerging, these technologies are expected to become a major area of investment over the next several years.
Supply Chain Visibility & Control Towers
A Supply Chain Control Tower provides a centralized view of suppliers, inventory, logistics networks, and risk information.
Rather than relying on siloed data sources, organizations can monitor critical dependencies from a single operational picture and identify disruptions earlier.
Common Benefits
- Improved visibility across suppliers and assets
- Faster response to disruptions
- Enhanced executive reporting
- Better risk awareness
- Improved operational coordination
Key Question
Can we identify and respond to supply chain disruptions before they impact operations?
Digital Twins & Scenario Planning
Digital Twins extend supply chain visibility by creating virtual representations of suppliers, transportation networks, inventory, and operational dependencies.
These environments allow organizations to evaluate potential disruptions before they occur and better understand the downstream impacts of events such as supplier failures, weather disruptions, or transportation constraints.
Recommendations
| Area | Recommended Actions |
|---|---|
| Procurement | Require SBOMs and HBOMs, assess supplier security practices, review remote access capabilities. |
| Visibility | Maintain supplier inventories, map dependencies, improve traceability and transparency. |
| Monitoring | Continuously assess supplier risks, geopolitical developments, and emerging threats. |
| Security | Eliminate default credentials, implement MFA, restrict remote access, and segment networks. |
Emerging Trends (2026–2027)
The following topics are receiving increasing attention across the utility and critical infrastructure sectors:
| High Priority | Emerging Areas |
|---|---|
|
|
Digital Product Passports (DPPs)
Digital Product Passports are emerging as a method for improving product traceability and lifecycle transparency. While currently driven primarily by international regulatory initiatives, they may influence future procurement, asset management, and supplier reporting requirements.
References
Additional Resources
- EPRI Supply Chain Assessment Research Program (112046)
- 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