IDEAS home Printed from https://ideas.repec.org/a/spr/flsman/v32y2020i3d10.1007_s10696-019-09346-7.html
   My bibliography  Save this article

Continuous-time scheduling of production, distribution and sales in photovoltaic supply chains with declining prices

Author

Listed:
  • Wolfgang Albrecht

    (University of Greifswald)

  • Martin Steinrücke

    (University of Greifswald)

Abstract

Supply chain networks in the photovoltaic sector were faced with a rapid decline in prices during the past few years, which is predicted to go on in the following years. These circumstances force related companies to coordinate production, distribution and transportation planning of all their network sites thoroughly. Moreover, continuous-time scheduling of processes is required to determine times of sales exactly within a multi-day planning horizon. Applying this type of scheduling is possible due to assessable price trends and existing framework agreements with wholesalers, and even necessary due to its impact on the realized sales prices, and thus, the network profit. For this reason, we develop a mixed-integer linear programming model that meets the requirements of fully-integrated photovoltaic supply chains that cover processing of raw materials, manufacturing of intermediate and finished products in two alternative methods, and selling them on international markets. The multi-product approach enables to connect supply chain stages with different product maturities. The modeling is motivated by a real-life case of a global photovoltaic group headquartered in Germany. As it was not possible to optimize this problem with high-performance software and hardware within 3 months, we tested several relax-and-fix decomposition methods. By selecting those algorithms that were able to generate high-quality solutions within acceptable computation times of less than half a day, a satisfying solution was found. The appropriateness of the selected algorithms is additionally demonstrated by analyzing randomly generated scenarios in a numerical study.

Suggested Citation

  • Wolfgang Albrecht & Martin Steinrücke, 2020. "Continuous-time scheduling of production, distribution and sales in photovoltaic supply chains with declining prices," Flexible Services and Manufacturing Journal, Springer, vol. 32(3), pages 629-667, September.
    • Handle: RePEc:spr:flsman:v:32:y:2020:i:3:d:10.1007_s10696-019-09346-7
    DOI: 10.1007/s10696-019-09346-7
    as

    Download full text from publisher

    File URL: http://link.springer.com/10.1007/s10696-019-09346-7
    File Function: Abstract
    Download Restriction: Access to the full text of the articles in this series is restricted.
    File URL: https://libkey.io/10.1007/s10696-019-09346-7?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. Jane Davies & Nitin Joglekar, 2013. "Supply Chain Integration, Product Modularity, and Market Valuation: Evidence from the Solar Energy Industry," Production and Operations Management, Production and Operations Management Society, vol. 22(6), pages 1494-1508, November.
    2. Bhatnagar, Rohit & Mehta, Peeyush & Chong Teo, Chee, 2011. "Coordination of planning and scheduling decisions in global supply chains with dual supply modes," International Journal of Production Economics, Elsevier, vol. 131(2), pages 473-482, June.
    3. VAN VYVE, Mathieu & WOLSEY, Laurence A & YAMAN, Hande, 2014. "Relaxations for two-level multi-item lot-sizing problems," LIDAM Reprints CORE 2611, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
    4. Ioannis Fragkos & Zeger Degraeve & Bert De Reyck, 2016. "A Horizon Decomposition Approach for the Capacitated Lot-Sizing Problem with Setup Times," INFORMS Journal on Computing, INFORMS, vol. 28(3), pages 465-482, August.
    5. David M. Byrne & Stephen D. Oliner & Daniel E. Sichel, 2018. "How Fast are Semiconductor Prices Falling?," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 64(3), pages 679-702, September.
    6. Umetani, Shunji & Fukushima, Yuta & Morita, Hiroshi, 2017. "A linear programming based heuristic algorithm for charge and discharge scheduling of electric vehicles in a building energy management system," Omega, Elsevier, vol. 67(C), pages 115-122.
    7. Christodoulos Floudas & Xiaoxia Lin, 2005. "Mixed Integer Linear Programming in Process Scheduling: Modeling, Algorithms, and Applications," Annals of Operations Research, Springer, vol. 139(1), pages 131-162, October.
    8. Tao Wu & Leyuan Shi & Jie Song, 2012. "An MIP-based interval heuristic for the capacitated multi-level lot-sizing problem with setup times," Annals of Operations Research, Springer, vol. 196(1), pages 635-650, July.
    9. Govindan, K. & Jafarian, A. & Khodaverdi, R. & Devika, K., 2014. "Two-echelon multiple-vehicle location–routing problem with time windows for optimization of sustainable supply chain network of perishable food," International Journal of Production Economics, Elsevier, vol. 152(C), pages 9-28.
    10. Wolfgang Albrecht & Martin Steinrücke, 2017. "Continuous-time production, distribution and financial planning with periodic liquidity balancing," Journal of Scheduling, Springer, vol. 20(3), pages 219-237, June.
    11. Martin Steinrücke & Michael Jahr, 2018. "Simultaneous optimisation of forward and reverse distribution processes with multiple types of reuse within an industrial tool supply chain," International Journal of Operational Research, Inderscience Enterprises Ltd, vol. 32(4), pages 397-420.
    12. Gan, Peck Yean & Li, ZhiDong, 2015. "Quantitative study on long term global solar photovoltaic market," Renewable and Sustainable Energy Reviews, Elsevier, vol. 46(C), pages 88-99.
    13. Awi Federgruen & Joern Meissner & Michal Tzur, 2007. "Progressive Interval Heuristics for Multi-Item Capacitated Lot-Sizing Problems," Operations Research, INFORMS, vol. 55(3), pages 490-502, June.
    14. Sawik, Tadeusz, 2009. "Coordinated supply chain scheduling," International Journal of Production Economics, Elsevier, vol. 120(2), pages 437-451, August.
    15. Yeung, Wing-Kwan & Choi, Tsan-Ming & Cheng, T.C.E., 2011. "Supply chain scheduling and coordination with dual delivery modes and inventory storage cost," International Journal of Production Economics, Elsevier, vol. 132(2), pages 223-229, August.
    16. Jayaraman, Vaidyanathan & Pirkul, Hasan, 2001. "Planning and coordination of production and distribution facilities for multiple commodities," European Journal of Operational Research, Elsevier, vol. 133(2), pages 394-408, January.
    17. Christiane Baumeister & Lutz Kilian, 2016. "Understanding the Decline in the Price of Oil since June 2014," Journal of the Association of Environmental and Resource Economists, University of Chicago Press, vol. 3(1), pages 131-158.
    18. Abdeljaouad, Mohamed Amine & Bahroun, Zied & Omrane, Anissa & Fondrevelle, Julien, 2015. "Job-shop production scheduling with reverse flows," European Journal of Operational Research, Elsevier, vol. 244(1), pages 117-128.
    19. Kerem Akartunalı & Ioannis Fragkos & Andrew J. Miller & Tao Wu, 2016. "Local Cuts and Two-Period Convex Hull Closures for Big-Bucket Lot-Sizing Problems," INFORMS Journal on Computing, INFORMS, vol. 28(4), pages 766-780, November.
    20. Liang, Zhe & He, Yan & Wu, Tao & Zhang, Canrong, 2015. "An informative column generation and decomposition method for a production planning and facility location problem," International Journal of Production Economics, Elsevier, vol. 170(PA), pages 88-96.
    21. Wang, Wenlin & Rivera, Daniel E. & Kempf, Karl G., 2007. "Model predictive control strategies for supply chain management in semiconductor manufacturing," International Journal of Production Economics, Elsevier, vol. 107(1), pages 56-77, May.
    22. Joel West, 2014. "Too little, too early: California’s transient advantage in the photovoltaic solar industry," The Journal of Technology Transfer, Springer, vol. 39(3), pages 487-501, June.
    23. Abdallah, Tarek & Diabat, Ali & Rigter, Jasper, 2013. "Investigating the option of installing small scale PVs on facility rooftops in a green supply chain," International Journal of Production Economics, Elsevier, vol. 146(2), pages 465-477.
    24. Zipp, Alexander, 2015. "Revenue prospects of photovoltaic in Germany—Influence opportunities by variation of the plant orientation," Energy Policy, Elsevier, vol. 81(C), pages 86-97.
    25. Erenguc, S. Selcuk & Simpson, N. C. & Vakharia, Asoo J., 1999. "Integrated production/distribution planning in supply chains: An invited review," European Journal of Operational Research, Elsevier, vol. 115(2), pages 219-236, June.
    26. Lars Mönch & Reha Uzsoy & John W. Fowler, 2018. "A survey of semiconductor supply chain models part III: master planning, production planning, and demand fulfilment," International Journal of Production Research, Taylor & Francis Journals, vol. 56(13), pages 4565-4584, July.
    27. Minjiao Zhang & Simge Küçükyavuz & Hande Yaman, 2012. "A Polyhedral Study of Multiechelon Lot Sizing with Intermediate Demands," Operations Research, INFORMS, vol. 60(4), pages 918-935, August.
    28. Reha Uzsoy & John W. Fowler & Lars Mönch, 2018. "A survey of semiconductor supply chain models Part II: demand planning, inventory management, and capacity planning," International Journal of Production Research, Taylor & Francis Journals, vol. 56(13), pages 4546-4564, July.
    29. Suresh Chand & Vernon Ning Hsu & Suresh Sethi, 2002. "Forecast, Solution, and Rolling Horizons in Operations Management Problems: A Classified Bibliography," Manufacturing & Service Operations Management, INFORMS, vol. 4(1), pages 25-43, September.
    30. Ullrich, Christian A., 2013. "Integrated machine scheduling and vehicle routing with time windows," European Journal of Operational Research, Elsevier, vol. 227(1), pages 152-165.
    31. Dillenberger, Christof & Escudero, Laureano F. & Wollensak, Artur & Zhang, Wu, 1994. "On practical resource allocation for production planning and scheduling with period overlapping setups," European Journal of Operational Research, Elsevier, vol. 75(2), pages 275-286, June.
    32. Ferreira, Deisemara & Morabito, Reinaldo & Rangel, Socorro, 2009. "Solution approaches for the soft drink integrated production lot sizing and scheduling problem," European Journal of Operational Research, Elsevier, vol. 196(2), pages 697-706, July.
    33. Relvas, Susana & Boschetto Magatão, Suelen N. & Barbosa-Póvoa, Ana Paula F.D. & Neves, Flávio, 2013. "Integrated scheduling and inventory management of an oil products distribution system," Omega, Elsevier, vol. 41(6), pages 955-968.
    34. Martin Steinrücke & Wolfgang Albrecht, 2018. "Integrated supply chain network planning and financial planning respecting the imperfection of the capital market," Journal of Business Economics, Springer, vol. 88(6), pages 799-825, August.
    35. Zhili Tian & Panos Kouvelis & Charles L. Munson, 2015. "Understanding and managing product line complexity: Applying sensitivity analysis to a large-scale MILP model to price and schedule new customer orders," IISE Transactions, Taylor & Francis Journals, vol. 47(4), pages 307-328, April.
    36. Martin Steinrücke & Wolfgang Albrecht, 2016. "A flow-to-equity approach to coordinate supply chain network planning and financial planning with annual cash outflows to an institutional investor," Business Research, Springer;German Academic Association for Business Research, vol. 9(2), pages 297-333, August.
    37. Mats Ekelund & Björn Persson, 2003. "Pharmaceutical Pricing in a Regulated Market," The Review of Economics and Statistics, MIT Press, vol. 85(2), pages 298-306, May.
    38. Rodrigo, P. & Fernández, E.F. & Almonacid, F. & Pérez-Higueras, P.J., 2013. "Models for the electrical characterization of high concentration photovoltaic cells and modules: A review," Renewable and Sustainable Energy Reviews, Elsevier, vol. 26(C), pages 752-760.
    39. Wolfgang Albrecht & Martin Steinrücke, 2018. "Coordinating continuous-time distribution and sales planning of perishable goods with quality grades," International Journal of Production Research, Taylor & Francis Journals, vol. 56(7), pages 2646-2665, April.
    40. Li, Wenkai & Goh, Mark & Wu, Yong & Petering, M.E.H. & de Souza, R. & Wu, Y.C., 2012. "A continuous time model for multiple yard crane scheduling with last minute job arrivals," International Journal of Production Economics, Elsevier, vol. 136(2), pages 332-343.
    41. Kerem Akartunalı & Andrew Miller, 2012. "A computational analysis of lower bounds for big bucket production planning problems," Computational Optimization and Applications, Springer, vol. 53(3), pages 729-753, December.
    42. Chen, Zhisong & Su, Shong-Iee Ivan, 2014. "Photovoltaic supply chain coordination with strategic consumers in China," Renewable Energy, Elsevier, vol. 68(C), pages 236-244.
    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. Maria A. Franco & Stefan N. Groesser, 2021. "A Systematic Literature Review of the Solar Photovoltaic Value Chain for a Circular Economy," Sustainability, MDPI, vol. 13(17), pages 1-35, August.
    2. Hadi Shenabi & Rashed Sahraeian, 2024. "Decision-Making Approach to Design a Sustainable Photovoltaic Closed-Loop Supply Chain Considering Market Share for Electric Vehicle Energy," Sustainability, MDPI, vol. 16(13), pages 1-28, July.

    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. Wei, Mingyuan & Qi, Mingyao & Wu, Tao & Zhang, Canrong, 2019. "Distance and matching-induced search algorithm for the multi-level lot-sizing problem with substitutable bill of materials," European Journal of Operational Research, Elsevier, vol. 277(2), pages 521-541.
    2. Doostmohammadi, Mahdi & Akartunalı, Kerem, 2018. "Valid inequalities for two-period relaxations of big-bucket lot-sizing problems: Zero setup case," European Journal of Operational Research, Elsevier, vol. 267(1), pages 86-95.
    3. Tao Wu, 2022. "Predictive Search for Capacitated Multi-Item Lot Sizing Problems," INFORMS Journal on Computing, INFORMS, vol. 34(1), pages 385-406, January.
    4. Ming Zhao & Minjiao Zhang, 2020. "Multiechelon Lot Sizing: New Complexities and Inequalities," Operations Research, INFORMS, vol. 68(2), pages 534-551, March.
    5. Tao Wu & Zhe Liang & Canrong Zhang, 2018. "Analytics Branching and Selection for the Capacitated Multi-Item Lot Sizing Problem with Nonidentical Machines," INFORMS Journal on Computing, INFORMS, vol. 30(2), pages 236-258, May.
    6. Kerem Akartunalı & Ioannis Fragkos & Andrew J. Miller & Tao Wu, 2016. "Local Cuts and Two-Period Convex Hull Closures for Big-Bucket Lot-Sizing Problems," INFORMS Journal on Computing, INFORMS, vol. 28(4), pages 766-780, November.
    7. Glomb, Lukas & Liers, Frauke & Rösel, Florian, 2022. "A rolling-horizon approach for multi-period optimization," European Journal of Operational Research, Elsevier, vol. 300(1), pages 189-206.
    8. Maria A. Franco & Stefan N. Groesser, 2021. "A Systematic Literature Review of the Solar Photovoltaic Value Chain for a Circular Economy," Sustainability, MDPI, vol. 13(17), pages 1-35, August.
    9. Kristin Uggen & Marte Fodstad & Vibeke Nørstebø, 2013. "Using and extending fix-and-relax to solve maritime inventory routing problems," TOP: An Official Journal of the Spanish Society of Statistics and Operations Research, Springer;Sociedad de Estadística e Investigación Operativa, vol. 21(2), pages 355-377, July.
    10. Wu, Tao & Xiao, Fan & Zhang, Canrong & Zhang, Defu & Liang, Zhe, 2019. "Regression and extrapolation guided optimization for production–distribution with ship–buy–exchange options," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 129(C), pages 15-37.
    11. Tao Wu & Kerem Akartunal? & Raf Jans & Zhe Liang, 2017. "Progressive Selection Method for the Coupled Lot-Sizing and Cutting-Stock Problem," INFORMS Journal on Computing, INFORMS, vol. 29(3), pages 523-543, August.
    12. Dziuba, Daryna & Almeder, Christian, 2023. "New construction heuristic for capacitated lot sizing problems," European Journal of Operational Research, Elsevier, vol. 311(3), pages 906-920.
    13. Farhat, Mlouka & Akbalik, Ayse & Hadj-Alouane, Atidel B. & Sauer, Nathalie, 2019. "Lot sizing problem with batch ordering under periodic buyback contract and lost sales," International Journal of Production Economics, Elsevier, vol. 208(C), pages 500-511.
    14. Wolfgang Albrecht & Martin Steinrücke, 2017. "Continuous-time production, distribution and financial planning with periodic liquidity balancing," Journal of Scheduling, Springer, vol. 20(3), pages 219-237, June.
    15. Wu, Tao & Huang, Le & Liang, Zhe & Zhang, Xiaoning & Zhang, Canrong, 2022. "A supervised learning-driven heuristic for solving the facility location and production planning problem," European Journal of Operational Research, Elsevier, vol. 301(2), pages 785-796.
    16. Jianxin Fang & Brenda Cheang & Andrew Lim, 2023. "Problems and Solution Methods of Machine Scheduling in Semiconductor Manufacturing Operations: A Survey," Sustainability, MDPI, vol. 15(17), pages 1-44, August.
    17. F. Tao & Y. Cheng & L. Zhang & A. Y. C. Nee, 2017. "Advanced manufacturing systems: socialization characteristics and trends," Journal of Intelligent Manufacturing, Springer, vol. 28(5), pages 1079-1094, June.
    18. Yeung, Wing-Kwan & Choi, Tsan-Ming & Cheng, T.C.E., 2011. "Supply chain scheduling and coordination with dual delivery modes and inventory storage cost," International Journal of Production Economics, Elsevier, vol. 132(2), pages 223-229, August.
    19. Smirnov, Dina & van Jaarsveld, Willem & Atan, Zümbül & de Kok, Ton, 2021. "Long-term resource planning in the high-tech industry: Capacity or inventory?," European Journal of Operational Research, Elsevier, vol. 293(3), pages 926-940.
    20. Liang Tang & Zhihong Jin & Xuwei Qin & Ke Jing, 2019. "Supply chain scheduling in a collaborative manufacturing mode: model construction and algorithm design," Annals of Operations Research, Springer, vol. 275(2), pages 685-714, April.

    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:spr:flsman:v:32:y:2020:i:3:d:10.1007_s10696-019-09346-7. 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: Sonal Shukla or Springer Nature Abstracting and Indexing (email available below). General contact details of provider: http://www.springer.com .

    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.