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The plight of the biomass power generation industry in China – A supply chain risk perspective

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  • Liu, Liwei
  • Ye, Junhong
  • Zhao, Yufei
  • Zhao, Erdong

Abstract

For the past several years, the biomass power generation industry in China has witnessed notably rapid development. However, many biomass power generation manufacturers in China are currently making small profits or suffering losses, and the entire biomass supply chain does not function well, which not only poses a challenge for the stable operation of enterprises but also may impact the smooth development of the biomass power industry. From the perspective of supply chain risk, this paper explores the reasons for the current plight and the future obstacles that the Chinese biomass power generation industry may face. Identifying such risks as market risk, production risk, technology risk, economic risk and management risk in the upstream, midstream and downstream of the biomass supply chain and ordering the degrees of risk controllability by the government and enterprises, it is determined that joint effort by both the Chinese Government and the biomass power generation enterprises is an ideal choice for risk control coming out of the plight. However, at present, more problems should go to the government for solutions than to the enterprises. To guide the healthy development of the industry, the Chinese government should play a more prominent role in promulgating supporting policies in each stage of the supply chain and strengthening the supervision and control of biomass projects. Last, specific measures taken by the Chinese Government and the enterprises are proposed.

Suggested Citation

  • Liu, Liwei & Ye, Junhong & Zhao, Yufei & Zhao, Erdong, 2015. "The plight of the biomass power generation industry in China – A supply chain risk perspective," Renewable and Sustainable Energy Reviews, Elsevier, vol. 49(C), pages 680-692.
    • Handle: RePEc:eee:rensus:v:49:y:2015:i:c:p:680-692
    DOI: 10.1016/j.rser.2015.04.151
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