Power Blackout Risks

consequences for silicon users
Japan represents 60% of the global silicon wafer supply. The silicon wafers are used in many integrated circuits 
and other micro devices, which are key parts used to make a wide range of electronic equipment. Some of the 
biggest silicon manufacturing units in Japan have been damaged by the earthquake and tsunamis and shortages 
may appear in a short time. Even if there are still alternative sources for these components, alternative suppliers 
might also be facing shortfalls because of the increasing demand, making it difficult for the manufacturers to find 
supplies elsewhere.

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crobriefing on Power Blackout Risks
5.1.2. specific impact based on car manufacturers 
The vulnerability of automotive manufacturers to the power outages is very pronounced, as the automotive 
industry has been the first industry to apply just-in-time production. A long supply interruption means a significant 
risk of stock shortage, resulting in a high risk of production loss.
According to the site www.automotive-index.com, the majority of the automotive suppliers are still located in 
developed countries (Canada, Germany, U.S., etc.). However, many suppliers are also increasingly located in 
developing countries. The energy supply in these countries is less reliable, as can be seen in Figure 7. When 
comparing the map of electrical power supply by country with the map of car manufacturing (Figure 8) and their 
suppliers, it becomes obvious that the spread of locations show a significant production in countries with lower 
power reliability, such as Turkey, India, Malaysia and Indonesia.
figure 7: quality of electricity supply by country, 2010
Source: World Economic Forum
figure 8: number of produced cars per countries in 2009
Source: OICA
1 = insufficient and suffers frequent interruptions 7 = sufficient and reliable

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5.2. Business Continuity Planning to mitigate power blackout risks
A well organised and implemented business continuity plan (BCP) is vital for the survival of a company
in case of a power blackout, as well as to gain access to insurance solutions for such risks. The holistic structure
of BCP includes both a company’s internal factors, such as organisation, infrastructure and information and 
decision-making channels, and external factors, such as technology, customers, suppliers, environment, nature 
and social setting. 
A successful BCP bases on a risk analysis which consists of 
•
Risk Identification Analysis (RIA)
•
Risk evaluation
•
Risk mitigation/adaption
•
Risk Control
Once the risks have been identified and evaluated, it is advisable to draw up a list of measures. This will show
the energy company specific areas of weakness of any business interruption in a systematic way. Examples of
all four risk management steps are outlined in the following table: