Why Supply chain transparency and sustainability is important in the PV industry?
Solar power has gained popularity in recent years and has become the fastest-growing source of new energy, exceeding all other forms of power generation. Despite the significant benefits of solar energy as well as its fundamental role in future energy development, there is a growing need to maintain supply chain transparency so that risks can be identified and managed properly.
The solar energy sector provides sustainability solutions to consumers by producing energy with enhancing energy security, low greenhouse gas impacts, and creating economic development and jobs. These factors, however, are only a part of the industry’s role in sustainability. In reality, the solar sector has a greater responsibility to manage and mitigate the risk of poor supply chain management by ensuring product availability on time and thus, preventing delays.
Tracing the source of components and raw material
The capacity to trace the source of components and raw materials throughout the supply chain, starting from input materials to the finished end-product, is critical for several reasons, which primarily includes sustainability at the forefront, followed by environment, health & safety (EHS), and social responsibility. Robust component & product traceability offers transparency and openness.
The rapidly growing solar energy demand will put immense pressure on the mineral supply chain. Thus, it is vital to increase supply chain transparency so that the risks can be better identified and solved. As a result, assessing the environmental and social impacts associated with PV cells should be balanced with product innovation and development in the solar energy sector to lessen the supply chain risks in the solar industry.
In 2020, the supply chain has witnessed sustainability and transparency at a staggering rate. The issue isn’t new anymore and various factors are conspiring to hold companies accountable for where and how the products are sourced and manufactured. For instance, the draft bill legislation was submitted to the European Commission in the same year to impose stringent supply chain due diligence for all companies under European Union. In addition to this, The U.S. Solar Energy Industries Association (SEIA), has released a new traceability tool, Solar Supply Chain Traceability Protocol, to help product manufacturers and importers of solar products identify the origin of solar product’s material inputs as well as trace its movements throughout the supply chain.
Due to this, the PV price and product details are not readily available. The transparency in the distribution channel ensures the distribution of authentic products, with thorough checking and packaging of the product.
Supply chain transparency and incorporation of sustainability measures in solar energy industry encourages the market players to adopt effective management systems. This system incorporates the movement of goods/components from raw material suppliers to the end-users.