IDEAS home Printed from https://ideas.repec.org/a/eee/appene/v213y2018icp626-638.html
   My bibliography  Save this article

Integrated strategic and tactical optimization of forest-based biomass supply chains to consider medium-term supply and demand variations

Author

Listed:
  • Akhtari, Shaghaygh
  • Sowlati, Taraneh
  • Griess, Verena C.

Abstract

Using forest-based biomass to produce bio-energy and bio-fuels could provide economic, environmental, and social benefits for communities. However, variability in biomass availability and high cost of delivered feedstock impact the profitability of the supply chain. Therefore, optimization models were developed in previous studies to design cost effective and profitable biomass-based supply chains at strategic level. Medium term variations in biomass supply and demand are not usually accounted for in strategic models. This may affect the feasibility of strategic plans prescribed by the optimization model at tactical level. To solve this issue, an integrated model is developed in this paper that includes strategic and tactical decisions simultaneously in order to optimize forest-based biomass supply chains. In addition to yearly variations in biomass supply, which can occur due to changes in harvest level, monthly variations in biomass availability, bioenergy/biofuels demand, and losses during preprocessing and storage of biomass are incorporated in the model. Other unique features of this model compared to the few integrated models developed in previous studies are as follows. (1) Decision regarding opening a new conversion facility is made yearly, not just at the beginning of the planning horizon. (2) A multi-product (heat, electricity, bio-oil and pellets) supply chain is considered. (3) The impact of fossil-based energy prices on bio-conversion investment decisions are accounted for in the model. (4) The optimization problem is modeled in a way that the global optimum solution is obtained within a reasonable time. Using a case study in Interior British Columbia, it is shown in the paper that the capacity of conversion technologies and the amount of procured biomass prescribed by the strategic model would not be sufficient to meet the monthly demand of bioenergy. Moreover, the net present value of the strategic model is overestimated due to underestimating the demand and procurement cost, and ignoring storage costs. It is shown that these issues are resolved using the integrated model.

Suggested Citation

  • Akhtari, Shaghaygh & Sowlati, Taraneh & Griess, Verena C., 2018. "Integrated strategic and tactical optimization of forest-based biomass supply chains to consider medium-term supply and demand variations," Applied Energy, Elsevier, vol. 213(C), pages 626-638.
    • Handle: RePEc:eee:appene:v:213:y:2018:i:c:p:626-638
    DOI: 10.1016/j.apenergy.2017.10.017
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S0306261917314320
    Download Restriction: Full text for ScienceDirect subscribers only
    File URL: https://libkey.io/10.1016/j.apenergy.2017.10.017?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Huang, Yongxi & Chen, Chien-Wei & Fan, Yueyue, 2010. "Multistage optimization of the supply chains of biofuels," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 46(6), pages 820-830, November.
    2. Tittmann, P.W. & Parker, N.C. & Hart, Q.J. & Jenkins, B.M., 2010. "A spatially explicit techno-economic model of bioenergy and biofuels production in California," Journal of Transport Geography, Elsevier, vol. 18(6), pages 715-728.
    3. Chinese, Damiana & Meneghetti, Antonella, 2005. "Optimisation models for decision support in the development of biomass-based industrial district-heating networks in Italy," Applied Energy, Elsevier, vol. 82(3), pages 228-254, November.
    4. Maung, Thein A. & Gustafson, Cole R. & Saxowsky, David M. & Nowatzki, John & Miljkovic, Tatjana & Ripplinger, David, 2013. "The logistics of supplying single vs. multi-crop cellulosic feedstocks to a biorefinery in southeast North Dakota," Applied Energy, Elsevier, vol. 109(C), pages 229-238.
    5. Frombo, Francesco & Minciardi, Riccardo & Robba, Michela & Sacile, Roberto, 2009. "A decision support system for planning biomass-based energy production," Energy, Elsevier, vol. 34(3), pages 362-369.
    6. Leduc, S. & Starfelt, F. & Dotzauer, E. & Kindermann, G. & McCallum, I. & Obersteiner, M. & Lundgren, J., 2010. "Optimal location of lignocellulosic ethanol refineries with polygeneration in Sweden," Energy, Elsevier, vol. 35(6), pages 2709-2716.
    7. de Jong, Sierk & Hoefnagels, Ric & Wetterlund, Elisabeth & Pettersson, Karin & Faaij, André & Junginger, Martin, 2017. "Cost optimization of biofuel production – The impact of scale, integration, transport and supply chain configurations," Applied Energy, Elsevier, vol. 195(C), pages 1055-1070.
    8. Akhtari, Shaghaygh & Sowlati, Taraneh & Day, Ken, 2014. "The effects of variations in supply accessibility and amount on the economics of using regional forest biomass for generating district heat," Energy, Elsevier, vol. 67(C), pages 631-640.
    9. Hartmut Stadtler & Bernhard Fleischmann, 2012. "Hierarchical Planning and the Supply Chain Planning Matrix," Management for Professionals, in: Advanced Planning in Supply Chains, chapter 0, pages 21-34, Springer.
    10. Gunnarsson, Helene & Ronnqvist, Mikael & Lundgren, Jan T., 2004. "Supply chain modelling of forest fuel," European Journal of Operational Research, Elsevier, vol. 158(1), pages 103-123, October.
    11. Hax, Arnoldo C. & Meal, Harlan C., 1973. "Hierarchical integration of production planning and scheduling," Working papers 656-73., Massachusetts Institute of Technology (MIT), Sloan School of Management.
    12. Tom Vogel & Bernardo Almada-Lobo & Christian Almeder, 2017. "Integrated versus hierarchical approach to aggregate production planning and master production scheduling," OR Spectrum: Quantitative Approaches in Management, Springer;Gesellschaft für Operations Research e.V., vol. 39(1), pages 193-229, January.
    13. Balaman, Şebnem Yılmaz & Selim, Hasan, 2014. "A network design model for biomass to energy supply chains with anaerobic digestion systems," Applied Energy, Elsevier, vol. 130(C), pages 289-304.
    14. Zhang, Jun & Osmani, Atif & Awudu, Iddrisu & Gonela, Vinay, 2013. "An integrated optimization model for switchgrass-based bioethanol supply chain," Applied Energy, Elsevier, vol. 102(C), pages 1205-1217.
    15. Ahn, Yu-Chan & Lee, In-Beum & Lee, Kun-Hong & Han, Jee-Hoon, 2015. "Strategic planning design of microalgae biomass-to-biodiesel supply chain network: Multi-period deterministic model," Applied Energy, Elsevier, vol. 154(C), pages 528-542.
    16. Hartmut Stadtler & Bernhard Fleischmann & Martin Grunow & Herbert Meyr & Christopher Sürie, 2012. "Advanced Planning in Supply Chains," Management for Professionals, Springer, number 978-3-642-24215-1, December.
    17. van Dyken, Silke & Bakken, Bjorn H. & Skjelbred, Hans I., 2010. "Linear mixed-integer models for biomass supply chains with transport, storage and processing," Energy, Elsevier, vol. 35(3), pages 1338-1350.
    18. Rentizelas, Athanasios A. & Tolis, Athanasios J. & Tatsiopoulos, Ilias P., 2009. "Logistics issues of biomass: The storage problem and the multi-biomass supply chain," Renewable and Sustainable Energy Reviews, Elsevier, vol. 13(4), pages 887-894, May.
    19. Gautam, Shuva & LeBel, Luc & Carle, Marc-André, 2017. "Supply chain model to assess the feasibility of incorporating a terminal between forests and biorefineries," Applied Energy, Elsevier, vol. 198(C), pages 377-384.
    20. Eriksson, Ljusk Ola & Bjorheden, Rolf, 1989. "Optimal storing, transport and processing for a forest-fuel supplier," European Journal of Operational Research, Elsevier, vol. 43(1), pages 26-33, November.
    21. Leduc, S. & Lundgren, J. & Franklin, O. & Dotzauer, E., 2010. "Location of a biomass based methanol production plant: A dynamic problem in northern Sweden," Applied Energy, Elsevier, vol. 87(1), pages 68-75, January.
    22. Gunasekaran, A. & Patel, C. & McGaughey, Ronald E., 2004. "A framework for supply chain performance measurement," International Journal of Production Economics, Elsevier, vol. 87(3), pages 333-347, February.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Li, Zhengbing & Liang, Yongtu & Ni, Weilong & Liao, Qi & Xu, Ning & Li, Lichao & Zheng, Jianqin & Zhang, Haoran, 2022. "Pipesharing: economic-environmental benefits from transporting biofuels through multiproduct pipelines," Applied Energy, Elsevier, vol. 311(C).
    2. Mosayeb Dashtpeyma & Reza Ghodsi, 2021. "Forest Biomass and Bioenergy Supply Chain Resilience: A Systematic Literature Review on the Barriers and Enablers," Sustainability, MDPI, vol. 13(12), pages 1-21, June.
    3. Lo, Shirleen Lee Yuen & How, Bing Shen & Teng, Sin Yong & Lam, Hon Loong & Lim, Chun Hsion & Rhamdhani, Muhammad Akbar & Sunarso, Jaka, 2021. "Stochastic techno-economic evaluation model for biomass supply chain: A biomass gasification case study with supply chain uncertainties," Renewable and Sustainable Energy Reviews, Elsevier, vol. 152(C).
    4. Albashabsheh, Nibal T. & Heier Stamm, Jessica L., 2019. "Optimization of lignocellulosic biomass-to-biofuel supply chains with mobile pelleting," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 122(C), pages 545-562.
    5. Bernardine Chigozie Chidozie & Ana Luísa Ramos & José Vasconcelos Ferreira & Luís Pinto Ferreira, 2023. "Residual Agroforestry Biomass Supply Chain Simulation Insights and Directions: A Systematic Literature Review," Sustainability, MDPI, vol. 15(13), pages 1-16, June.
    6. Luo, Li & O'Hehir, Jim & Regan, Courtney M. & Meng, Li & Connor, Jeffery D. & Chow, Christopher W.K., 2021. "An integrated strategic and tactical optimization model for forest supply chain planning," Forest Policy and Economics, Elsevier, vol. 131(C).
    7. Zetterholm, Jonas & Pettersson, Karin & Leduc, Sylvain & Mesfun, Sennai & Lundgren, Joakim & Wetterlund, Elisabeth, 2018. "Resource efficiency or economy of scale: Biorefinery supply chain configurations for co-gasification of black liquor and pyrolysis liquids," Applied Energy, Elsevier, vol. 230(C), pages 912-924.
    8. Charisios Achillas & Dionysis Bochtis, 2021. "Supply Chain Management for Bioenergy and Bioresources: Bridging the Gap between Theory and Practice," Energies, MDPI, vol. 14(19), pages 1-4, September.
    9. Shohre Khoddami & Fereshteh Mafakheri & Yong Zeng, 2021. "A System Dynamics Approach to Comparative Analysis of Biomass Supply Chain Coordination Strategies," Energies, MDPI, vol. 14(10), pages 1-35, May.
    10. Henrique Piqueiro & Reinaldo Gomes & Romão Santos & Jorge Pinho de Sousa, 2023. "Managing Disruptions in a Biomass Supply Chain: A Decision Support System Based on Simulation/Optimisation," Sustainability, MDPI, vol. 15(9), pages 1-25, May.
    11. Gao, Evelyn & Sowlati, Taraneh & Akhtari, Shaghaygh, 2019. "Profit allocation in collaborative bioenergy and biofuel supply chains," Energy, Elsevier, vol. 188(C).
    12. Abbas, Shahbaz & Chiang Hsieh, Lin-Han & Techato, Kuaanan, 2021. "Supply chain integrated decision model in order to synergize the energy system of textile industry from its resource waste," Energy, Elsevier, vol. 229(C).
    13. Yang, Hanyu & Dou, Xun & Pan, Feng & Wu, Qiuwei & Li, Canbing & Zhou, Bin & Hao, Lili, 2022. "Optimal planning of local biomass-based integrated energy system considering anaerobic co-digestion," Applied Energy, Elsevier, vol. 316(C).
    14. Razm, Sobhan & Brahimi, Nadjib & Hammami, Ramzi & Dolgui, Alexandre, 2023. "A production planning model for biorefineries with biomass perishability and biofuel transformation," International Journal of Production Economics, Elsevier, vol. 258(C).
    15. Mohd F. M. A. Zamri & Jassinnee Milano & Abd H. Shamsuddin & Mohd E. M. Roslan & Siti F. Salleh & Adlansyah A. Rahman & Raihana Bahru & Islam M. R. Fattah & T. M. Indra Mahlia, 2022. "An overview of palm oil biomass for power generation sector decarbonization in Malaysia: Progress, challenges, and prospects," Wiley Interdisciplinary Reviews: Energy and Environment, Wiley Blackwell, vol. 11(4), July.
    16. Akhtari, Shaghaygh & Sowlati, Taraneh, 2020. "Hybrid optimization-simulation for integrated planning of bioenergy and biofuel supply chains," Applied Energy, Elsevier, vol. 259(C).
    17. Tian, Xiaoge & Chen, Weiming & Hu, Jinglu, 2023. "Game-theoretic modeling of power supply chain coordination under demand variation in China: A case study of Guangdong Province," Energy, Elsevier, vol. 262(PA).
    18. Prinz, Robert & Väätäinen, Kari & Laitila, Juha & Sikanen, Lauri & Asikainen, Antti, 2019. "Analysis of energy efficiency of forest chip supply systems using discrete-event simulation," Applied Energy, Elsevier, vol. 235(C), pages 1369-1380.
    19. Farajiamiri, Mina & Meyer, Jörn-Christian & Walther, Grit, 2023. "Multi-objective optimization of renewable fuel supply chains regarding cost, land use, and water use," Applied Energy, Elsevier, vol. 349(C).

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Cambero, Claudia & Sowlati, Taraneh, 2014. "Assessment and optimization of forest biomass supply chains from economic, social and environmental perspectives – A review of literature," Renewable and Sustainable Energy Reviews, Elsevier, vol. 36(C), pages 62-73.
    2. De Meyer, Annelies & Cattrysse, Dirk & Rasinmäki, Jussi & Van Orshoven, Jos, 2014. "Methods to optimise the design and management of biomass-for-bioenergy supply chains: A review," Renewable and Sustainable Energy Reviews, Elsevier, vol. 31(C), pages 657-670.
    3. Ba, Birome Holo & Prins, Christian & Prodhon, Caroline, 2016. "Models for optimization and performance evaluation of biomass supply chains: An Operations Research perspective," Renewable Energy, Elsevier, vol. 87(P2), pages 977-989.
    4. Malladi, Krishna Teja & Sowlati, Taraneh, 2018. "Biomass logistics: A review of important features, optimization modeling and the new trends," Renewable and Sustainable Energy Reviews, Elsevier, vol. 94(C), pages 587-599.
    5. Shabani, Nazanin & Akhtari, Shaghaygh & Sowlati, Taraneh, 2013. "Value chain optimization of forest biomass for bioenergy production: A review," Renewable and Sustainable Energy Reviews, Elsevier, vol. 23(C), pages 299-311.
    6. Shabani, Nazanin & Sowlati, Taraneh, 2013. "A mixed integer non-linear programming model for tactical value chain optimization of a wood biomass power plant," Applied Energy, Elsevier, vol. 104(C), pages 353-361.
    7. Razm, Sobhan & Brahimi, Nadjib & Hammami, Ramzi & Dolgui, Alexandre, 2023. "A production planning model for biorefineries with biomass perishability and biofuel transformation," International Journal of Production Economics, Elsevier, vol. 258(C).
    8. Shabani, Nazanin & Sowlati, Taraneh & Ouhimmou, Mustapha & Rönnqvist, Mikael, 2014. "Tactical supply chain planning for a forest biomass power plant under supply uncertainty," Energy, Elsevier, vol. 78(C), pages 346-355.
    9. Suckling, Ian D. & de Miguel Mercader, Ferran & Monge, Juan J. & Wakelin, Steve J. & Hall, Peter W. & Bennett, Paul J. & Höck, Barbara & Samsatli, Nouri J. & Samsatli, Sheila & Fahmy, Muthasim, 2022. "Best options for large-scale production of liquid biofuels by value chain modelling: A New Zealand case study," Applied Energy, Elsevier, vol. 323(C).
    10. Nunes, L.J.R. & Causer, T.P. & Ciolkosz, D., 2020. "Biomass for energy: A review on supply chain management models," Renewable and Sustainable Energy Reviews, Elsevier, vol. 120(C).
    11. Mafakheri, Fereshteh & Nasiri, Fuzhan, 2014. "Modeling of biomass-to-energy supply chain operations: Applications, challenges and research directions," Energy Policy, Elsevier, vol. 67(C), pages 116-126.
    12. Espinoza Pérez, Andrea Teresa & Camargo, Mauricio & Narváez Rincón, Paulo César & Alfaro Marchant, Miguel, 2017. "Key challenges and requirements for sustainable and industrialized biorefinery supply chain design and management: A bibliographic analysis," Renewable and Sustainable Energy Reviews, Elsevier, vol. 69(C), pages 350-359.
    13. Jensen, Ida Græsted & Münster, Marie & Pisinger, David, 2017. "Optimizing the supply chain of biomass and biogas for a single plant considering mass and energy losses," European Journal of Operational Research, Elsevier, vol. 262(2), pages 744-758.
    14. Zhang, Fengli & Johnson, Dana M. & Wang, Jinjiang, 2016. "Integrating multimodal transport into forest-delivered biofuel supply chain design," Renewable Energy, Elsevier, vol. 93(C), pages 58-67.
    15. Malladi, Krishna Teja & Quirion-Blais, Olivier & Sowlati, Taraneh, 2018. "Development of a decision support tool for optimizing the short-term logistics of forest-based biomass," Applied Energy, Elsevier, vol. 216(C), pages 662-677.
    16. Tatiana M. Pinho & João Paulo Coelho & Germano Veiga & A. Paulo Moreira & José Boaventura-Cunha, 2017. "A Multilayer Model Predictive Control Methodology Applied to a Biomass Supply Chain Operational Level," Complexity, Hindawi, vol. 2017, pages 1-10, July.
    17. Azadeh, Ali & Vafa Arani, Hamed & Dashti, Hossein, 2014. "A stochastic programming approach towards optimization of biofuel supply chain," Energy, Elsevier, vol. 76(C), pages 513-525.
    18. Samsatli, Sheila & Samsatli, Nouri J. & Shah, Nilay, 2015. "BVCM: A comprehensive and flexible toolkit for whole system biomass value chain analysis and optimisation – Mathematical formulation," Applied Energy, Elsevier, vol. 147(C), pages 131-160.
    19. Sharma, B. & Ingalls, R.G. & Jones, C.L. & Khanchi, A., 2013. "Biomass supply chain design and analysis: Basis, overview, modeling, challenges, and future," Renewable and Sustainable Energy Reviews, Elsevier, vol. 24(C), pages 608-627.
    20. Kargbo, Hannah & Harris, Jonathan Stuart & Phan, Anh N., 2021. "“Drop-in” fuel production from biomass: Critical review on techno-economic feasibility and sustainability," Renewable and Sustainable Energy Reviews, Elsevier, vol. 135(C).

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:appene:v:213:y:2018:i:c:p:626-638. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Catherine Liu (email available below). General contact details of provider: http://www.elsevier.com/wps/find/journaldescription.cws_home/405891/description#description .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.