IDEAS home Printed from https://ideas.repec.org/a/inm/ortrsc/v48y2014i4p540-554.html
   My bibliography  Save this article

An Integrated Biofuel Supply Chain to Cope with Feedstock Seasonality and Uncertainty

Author

Listed:
  • Yongxi (Eric) Huang

    (Department of Civil Engineering, Clemson University, Clemson, South Carolina 29631)

  • Yueyue Fan

    (Department of Civil and Environmental Engineering, University of California, Davis, Davis, California 95616)

  • Chien-Wei Chen

    (Taiwan Research Institute, Taipei, Taiwan)

Abstract

A biofuel supply chain consists of various interdependent components from feedstock resources all the way to energy demand sites. This study focuses on the design of an efficient biofuel supply chain system against seasonal variations and uncertainties of feedstock supply in an integrative manner. By integrating planning and operational decisions in a stochastic programming framework, we aim at finding an effective design strategy for biofuel supply chain that is economically viable and hedges well against a wide range of future uncertainties. A solution algorithm based on scenario decomposition is designed to overcome computational challenges involved in large-scale applications. A California case study is implemented to demonstrate the applicability of the proposed methods in evaluating the economic potential, the infrastructure needs, and the risk of waste-based bioethanol production.

Suggested Citation

  • Yongxi (Eric) Huang & Yueyue Fan & Chien-Wei Chen, 2014. "An Integrated Biofuel Supply Chain to Cope with Feedstock Seasonality and Uncertainty," Transportation Science, INFORMS, vol. 48(4), pages 540-554, November.
    • Handle: RePEc:inm:ortrsc:v:48:y:2014:i:4:p:540-554
    DOI: 10.1287/trsc.2013.0498
    as

    Download full text from publisher

    File URL: http://dx.doi.org/10.1287/trsc.2013.0498
    Download Restriction: no
    File URL: https://libkey.io/10.1287/trsc.2013.0498?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
    ---><---

    References listed on IDEAS

    as
    1. Sperling, Daniel & Farrell, Alexander, 2007. "A Low-Carbon Fuel Standard for California, Part 2: Policy Analysis," Institute of Transportation Studies, Working Paper Series qt5hv693r2, Institute of Transportation Studies, UC Davis.
    2. 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.
    3. Jean-François Cordeau & Federico Pasin & Marius Solomon, 2006. "An integrated model for logistics network design," Annals of Operations Research, Springer, vol. 144(1), pages 59-82, April.
    4. Jean-Paul Watson & David Woodruff, 2011. "Progressive hedging innovations for a class of stochastic mixed-integer resource allocation problems," Computational Management Science, Springer, vol. 8(4), pages 355-370, November.
    5. Tang, Christopher S., 2006. "Perspectives in supply chain risk management," International Journal of Production Economics, Elsevier, vol. 103(2), pages 451-488, October.
    6. R. T. Rockafellar & Roger J.-B. Wets, 1991. "Scenarios and Policy Aggregation in Optimization Under Uncertainty," Mathematics of Operations Research, INFORMS, vol. 16(1), pages 119-147, February.
    7. Farrell, Alexander E. & Sperling, Dan, 2007. "A Low-Carbon Fuel Standard for California, Part 2: Policy Analysis," Institute of Transportation Studies, Working Paper Series qt8ng2h3x7, Institute of Transportation Studies, UC Davis.
    8. Yueyue Fan & Changzheng Liu, 2010. "Solving Stochastic Transportation Network Protection Problems Using the Progressive Hedging-based Method," Networks and Spatial Economics, Springer, vol. 10(2), pages 193-208, June.
    9. Farrell, Alexander E. & Sperling, Dan, 2007. "A Low-Carbon Fuel Standard for California, Part 1: Technical Analysis," Institute of Transportation Studies, Working Paper Series qt6j67z9w6, Institute of Transportation Studies, UC Davis.
    10. Farrell, Alexander E. & Sperling, Daniel & Brandt, A.R. & Eggert, A. & Farrell, A.E. & Haya, B.K. & Hughes, J. & Jenkins, B.M. & Jones, A.D. & Kammen, D.M. & Knittel, C.R. & Melaina, M.W. & O'Hare, M., 2007. "A Low-Carbon Fuel Standard for California Part 2: Policy Analysis," Institute of Transportation Studies, Research Reports, Working Papers, Proceedings qt1hm6k089, Institute of Transportation Studies, UC Berkeley.
    11. Farrell, Alexander & Sperling, Daniel, 2007. "A Low-Carbon Fuel Standard for California, Part 2: Policy Analysis," Institute of Transportation Studies, Working Paper Series qt8xv635dc, Institute of Transportation Studies, UC Davis.
    12. Tembo, Gelson & Epplin, Francis M. & Huhnke, Raymond L., 2003. "Integrative Investment Appraisal of a Lignocellulosic Biomass-to-Ethanol Industry," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 28(3), pages 1-23, December.
    13. Delucchi, Mark, 2006. "Lifecycle Analyses of Biofuels," Institute of Transportation Studies, Working Paper Series qt1pq0f84z, Institute of Transportation Studies, UC Davis.
    14. John M. Mulvey & Hercules Vladimirou, 1992. "Stochastic Network Programming for Financial Planning Problems," Management Science, INFORMS, vol. 38(11), pages 1642-1664, November.
    15. Farrell, Alexander E. & Sperling, Daniel & Arons, S.M. & Brandt, A.R. & Delucchi, M.A. & Eggert, A. & Farrell, A.E. & Haya, B.K. & Hughes, J. & Jenkins, B.M. & Jones, A.D. & Kammen, D.M. & Kaffka, S.R, 2007. "A Low-Carbon Fuel Standard for California Part 1: Technical Analysis," Institute of Transportation Studies, Research Reports, Working Papers, Proceedings qt8zm8d3wj, Institute of Transportation Studies, UC Berkeley.
    16. Farrell, Alexander & Sperling, Daniel, 2007. "A Low-Carbon Fuel Standard for California, Part 1: Technical Analysis," Institute of Transportation Studies, Working Paper Series qt5245b5kx, Institute of Transportation Studies, UC Davis.
    17. Turner, Brian T. & Plevin, Richard J. & O'Hare, Michael & Farrell, Alexander E., 2007. "Creating Markets for Green Biofuels: Measuring and improving environmental performance," Institute of Transportation Studies, Research Reports, Working Papers, Proceedings qt0mm0m9xm, Institute of Transportation Studies, UC Berkeley.
    18. Petrolia, Daniel R., 2006. "Ethanol from Biomass: Economic and Environmental Potential of Converting Corn Stover and Hardwood Forest Residue in Minnesota," 2006 Annual meeting, July 23-26, Long Beach, CA 21422, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
    19. Chen, Chien-Wei & Fan, Yueyue, 2012. "Bioethanol supply chain system planning under supply and demand uncertainties," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 48(1), pages 150-164.
    20. Parker, Nathan C. & Ogden, Joan M. & Fan, Yueyue, 2008. "The role of biomass in California's hydrogen economy," Energy Policy, Elsevier, vol. 36(10), pages 3925-3939, October.
    21. Melo, M.T. & Nickel, S. & Saldanha-da-Gama, F., 2009. "Facility location and supply chain management - A review," European Journal of Operational Research, Elsevier, vol. 196(2), pages 401-412, July.
    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. 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.
    2. Li, Yuanzhe, 2019. "Modeling Bioenergy Supply Chains: Feedstocks Pretreatment, Integrated System Design Under Uncertainty," Institute of Transportation Studies, Working Paper Series qt1539g5sj, Institute of Transportation Studies, UC Davis.
    3. Wang, Xin & Lim, Michael K. & Ouyang, Yanfeng, 2015. "Infrastructure deployment under uncertainties and competition: The biofuel industry case," Transportation Research Part B: Methodological, Elsevier, vol. 78(C), pages 1-15.
    4. Wolff, Michael & Becker, Tristan & Walther, Grit, 2023. "Long-term design and analysis of renewable fuel supply chains – An integrated approach considering seasonal resource availability," European Journal of Operational Research, Elsevier, vol. 304(2), pages 745-762.
    5. 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.
    6. Halit Üster & Gökhan Memişoğlu, 2018. "Biomass Logistics Network Design Under Price-Based Supply and Yield Uncertainty," Transportation Science, INFORMS, vol. 52(2), pages 474-492, March.
    7. Lixia H. Lambert & Eric A. DeVuyst & Burton C. English & Rodney Holcomb, 2021. "Analyzing the Trade-Offs between Meeting Biorefinery Production Capacity and Feedstock Supply Cost: A Chance Constrained Approach," Energies, MDPI, vol. 14(16), pages 1-13, August.
    8. Tao, Yi & Wu, Jianhuang & Lai, Xiaofan & Wang, Fan, 2020. "Network planning and operation of sustainable closed-loop supply chains in emerging markets: Retail market configurations and carbon policies," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 144(C).
    9. 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.
    10. Fattahi, Mohammad & Govindan, Kannan, 2018. "A multi-stage stochastic program for the sustainable design of biofuel supply chain networks under biomass supply uncertainty and disruption risk: A real-life case study," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 118(C), pages 534-567.
    11. Wang, Xin & Lim, Michael K. & Ouyang, Yanfeng, 2017. "Food-energy-environment trilemma: Policy impacts on farmland use and biofuel industry development," Energy Economics, Elsevier, vol. 67(C), pages 35-48.
    12. Xie, Fei & Huang, Yongxi, 2018. "A multistage stochastic programming model for a multi-period strategic expansion of biofuel supply chain under evolving uncertainties," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 111(C), pages 130-148.
    13. Sharma, Bijay P. & Yu, T. Edward & English, Burton C. & Boyer, Christopher N. & Larson, James A., 2020. "Impact of government subsidies on a cellulosic biofuel sector with diverse risk preferences toward feedstock uncertainty," Energy Policy, Elsevier, vol. 146(C).
    14. Mohammad Marufuzzaman & Sandra Duni Ekşioğlu, 2017. "Designing a Reliable and Dynamic Multimodal Transportation Network for Biofuel Supply Chains," Transportation Science, INFORMS, vol. 51(2), pages 494-517, May.
    15. Zhixue Liu & Shukun Wang & Yanfeng Ouyang, 2017. "Reliable Biomass Supply Chain Design under Feedstock Seasonality and Probabilistic Facility Disruptions," Energies, MDPI, vol. 10(11), pages 1-18, November.
    16. Jiang, Zhong-Zhong & He, Na & Huang, Song, 2021. "Government penalty provision and contracting with asymmetric quality information in a bioenergy supply chain," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 154(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. Fan, Yueyue & Huang, Yongxi & Chen, Chien-Wei, 2012. "Multistage Infrastructure System Design: An Integrated Biofuel Supply Chain against Feedstock Seasonality and Uncertainty," Institute of Transportation Studies, Working Paper Series qt9g8413m5, Institute of Transportation Studies, UC Davis.
    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. Kammen, Daniel M. & Farrell, Alexander E & Plevin, Richard J & Jones, Andrew & Nemet, Gregory F & Delucchi, Mark, 2008. "Energy and Greenhouse Gas Impacts of Biofuels: A Framework for Analysis," Institute of Transportation Studies, Working Paper Series qt5qw5g6q2, Institute of Transportation Studies, UC Davis.
    4. Huseynov, Samir & Palma, Marco A., 2018. "Does California’s LCFS Reduce CO2 Emissions?," 2018 Annual Meeting, August 5-7, Washington, D.C. 274200, Agricultural and Applied Economics Association.
    5. Axsen, Jonn & Wolinetz, Michael, 2023. "What does a low-carbon fuel standard contribute to a policy mix? An interdisciplinary review of evidence and research gaps," Transport Policy, Elsevier, vol. 133(C), pages 54-63.
    6. Fischer, Carolyn & Salant, Stephen W., 2017. "Balancing the carbon budget for oil: The distributive effects of alternative policies," European Economic Review, Elsevier, vol. 99(C), pages 191-215.
    7. Rubin, Jonathan & Leiby, Paul N., 2013. "Tradable credits system design and cost savings for a national low carbon fuel standard for road transport," Energy Policy, Elsevier, vol. 56(C), pages 16-28.
    8. Gang Tian & Jian Shi & Licheng Sun & Xingle Long & Benhai Guo, 2017. "Dynamic changes in the energy–carbon performance of Chinese transportation sector: a meta-frontier non-radial directional distance function approach," Natural Hazards: Journal of the International Society for the Prevention and Mitigation of Natural Hazards, Springer;International Society for the Prevention and Mitigation of Natural Hazards, vol. 89(2), pages 585-607, November.
    9. Dallas Burtraw, 2008. "Regulating CO 2 in electricity markets: sources or consumers?," Climate Policy, Taylor & Francis Journals, vol. 8(6), pages 588-606, November.
    10. Yeh, Sonia & Witcover, Julie & Lade, Gabriel E. & Sperling, Daniel, 2016. "A review of low carbon fuel policies: Principles, program status and future directions," Energy Policy, Elsevier, vol. 97(C), pages 220-234.
    11. Holland, Stephen P., 2012. "Emissions taxes versus intensity standards: Second-best environmental policies with incomplete regulation," Journal of Environmental Economics and Management, Elsevier, vol. 63(3), pages 375-387.
    12. Rode, Philipp & Floater, Graham & Thomopoulos, Nikolas & Docherty, James & Schwinger, Peter & Mahendra, Anjali & Fang, Wanli, 2014. "Accessibility in cities: transport and urban form," LSE Research Online Documents on Economics 60477, London School of Economics and Political Science, LSE Library.
    13. Hester, Annette & Lawrence, Leah, 2010. "A sub-national public-private strategic alliance for innovation and export development: the case of the Canadian province of Alberta's oil sands," Documentos de Proyectos 3760, Naciones Unidas Comisión Económica para América Latina y el Caribe (CEPAL).
    14. Parker, Nathan C. & Ogden, Joan M. & Fan, Yueyue, 2008. "The role of biomass in California's hydrogen economy," Energy Policy, Elsevier, vol. 36(10), pages 3925-3939, October.
    15. Leighty, Wayne & Ogden, Joan M. & Yang, Christopher, 2012. "Modeling transitions in the California light-duty vehicles sector to achieve deep reductions in transportation greenhouse gas emissions," Energy Policy, Elsevier, vol. 44(C), pages 52-67.
    16. Rocio A., Diaz-Chavez, 2011. "Assessing biofuels: Aiming for sustainable development or complying with the market?," Energy Policy, Elsevier, vol. 39(10), pages 5763-5769, October.
    17. Milazzo, M.F. & Spina, F. & Cavallaro, S. & Bart, J.C.J., 2013. "Sustainable soy biodiesel," Renewable and Sustainable Energy Reviews, Elsevier, vol. 27(C), pages 806-852.
    18. Parker, Nathan C & Ogden, Joan & Fan, Yueyue, 2009. "The role of biomass in California's hydrogen economy," Institute of Transportation Studies, Working Paper Series qt8412751s, Institute of Transportation Studies, UC Davis.
    19. Fan, Yingjie & Schwartz, Frank & Voß, Stefan, 2017. "Flexible supply chain planning based on variable transportation modes," International Journal of Production Economics, Elsevier, vol. 183(PC), pages 654-666.
    20. Daniel M. Kammen & Alexander E. Farrell & Richard J. Plevin & Andrew D. Jones & Mark A. Delucchi & Gregory F. Nemet, 2007. "Energy and Greenhouse Impacts of Biofuels: A Framework for Analysis," OECD/ITF Joint Transport Research Centre Discussion Papers 2007/2, OECD Publishing.

    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:inm:ortrsc:v:48:y:2014:i:4:p:540-554. 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: Chris Asher (email available below). General contact details of provider: https://edirc.repec.org/data/inforea.html .

    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.