7.2 Centralized versus distributed and decentralized energy generation

PRESENTER: Translating sustainability principles into actionable items is a difficult challenge for the industry, because they need to meet the standards of extended producer responsibility. In other words, it means that they have to analyze how the sustainable principles apply across the land of the supply chain. And they need to do this without compromising the quality of the product, the promptness at which it will have to be delivered.

They cannot compromise profitability, and they cannot compromise the original characteristics of the products of services. In addition to that, standards need to be applied across different processes, across different types of industries, and across cultural and geopolitical boundaries.

Interestingly enough, the greening of the supply chain has been driven by market pressures. As consumers begin to be more aware of potential risks to their health, potential risks to the health of those who are providing and producing the services and goods that they are accessing, they become more concerned about issues of fairness, about issues of trade equity, et cetera, et cetera. And they also become a lot more concerned about the degradation of the commons that occurs not only locally, but across national boundaries.

And these become even more of a challenge when you're moving the taxing of the commons from places that are very well regulated, where we understand a number of the limitations that a particular chain will have to places in developing countries that may have looser environmental regulations.

Consequently, the drivers for the industry to make these changes, to green their supply chain, are a response to attempting to maintain a customer base. They are a response to become more efficient in the use of resources.

And this is of particular interest when it comes to waste management. Because one of the major challenges that we face when we recycle is the closing of the recycling loop. And the incremental drive in using recycled goods, as opposed to virgin resources, might finally, effectively close that particular loop.

As you may imagine, there is significant overlap between the toll of principles of sustainable engineering that we covered as part of your module one and the best practices for greening the supply chain. They both come to address some of the same challenges and come from some of the same motivation. However, in this module, we are not just tackling environmental system concerns in a vacuum. We are doing an analysis that includes the economic drivers that will lead us to the use of limited environmental resources.