Green Operations Management

A number of articles discuss environmental issues in operations management. Here are a few:

Environmental and Operations Management Face the Future
L.C. Angell
in Decision Line, May 1999
Notes: This brief article from 1999 includes a table listing special journal issues on environmental operations management and related areas. I am listing these and some others I have found in a separate post.

Integrating environmental issues into the mainstream: an agenda for research in operations management
L.C. Angell and R.D. Klassen
in Journal of Operations Management, Volume 17, Issue 5, August 1999, Pages 575-598
Notes: Same author as above. For what it’s worth, Scholar reports 165 citations as of May 5, 2008. If nothing else, given that these references are a bit old, mine the citing papers to find more recent work.

‘Green’ value chain practices in the furniture industry
R. B. Handfield, S. V. Waltonb, L. K. Seegersc and S. A. Melnyka
in Journal of Operations Management, Volume 15, Issue 4, November 1997, Pages 293-315

Environmental operations management: An opportunity for improvement
M. Gupta and K. Sharma
in Production and Inventory Management Journal, Volume 37, 1996

The sustainability debate
A. Wilkinson, M. Hill, and P. Gollan
in International Journal of Operations & Production Management, 2001, Vol. 21, Issue 12, 1492 – 1502

See also the post on special journal issues.

Special Issues

The following are special journal issues covering some aspect of the sustainability/operations research intersection :

Green Operations, Production & Operations Monthly (OM newsletter), April 2007, Vol. 2, No. 1.

Closed-Loop Supply Chains: Practice and Potential, Interfaces, November-December 2003. I wrote about this back in July 2007.

Sustainable Business, Interfaces, May-June 2000, Vol. 30, No. 3
Notes: Contains a number of practical articles. Also, I was impressed to see an article by cradle-to-cradlers McDonough and Braungart in an OR journal. There is even an article on “the natural step” philosophy. More on this issue soon…

Environmental Planning, EJOR, Vol. 121, no. 2, March 2000, eds. S. Salhi and B. Boffey.

The Impact of Environmental Pressures on Operations Management, International Journal of Operations & Production Management, 2000; Vol. 20, Iss. 2, ed. L.C. Angell.

Operations Issues in Environmentally Conscious Manufacturing, Computers and Industrial Engineering, Vol. 36 No. 4, Sep 1999, ed. M. Gupta (mentioned in this post), looks good, has the ROTEB and Gungor/Gupta survey articles that were previously listed in references.

Environmental Planning, EJOR, Vol. 102, no. 2, Pages 247-403, 16 October 1997, ed. C.P. Pappis, papers presented at the EURO Summer Institute on Environmental Planning.

Upcoming issues
Closed-Loop Supply Chains, EJOR, see post concerning this issue.

Ethics and Operations Research, Omega, slated for late 2009, see post on this one.

More references…

Operations research and environmental planning
S. E. Daniela, D. C. Diakoulakib and C. P. Pappis
in European Journal of Operational Research, Volume 102, Issue 2, 16 October 1997, Pages 248-263
Notes: Contains an extensive list of over 100 references. In the 1997 “Environmental Planning” special issue of EJOR.

Interactions between operational research and environmental management
J. M. Bloemhof-Ruwaarda, P. van Beekb, L. Hordijka and L. N. Van Wassenhove
in European Journal of Operational Research Volume 85, Issue 2, 7 September 1995, Pages 229-243

MCDA and Energy Planning
D. Diakoulaki, C. Antunes and A. Gomes Martins
and
Multiple Criteria Decision Analysis and Sustainable Development
G. Munda
both in the book Multiple Criteria Decision Analysis: State of the Art Surveys
see the book’s Springer page

A Primer on Environmental Decision-Making - An Integrative Quantitative Approach
by K. Seip and F. Wenstøp
Notes: This is a textbook. Game theory is the only OR-related technique explicitly mentioned in the table of contents, but it stands to reason that others would be inside. See the Springer page as well as their “Environmental Management” series.

Agricultural sustainable management: a normative approach based on goal programming
S. Elfkih, M.L. Feijoo and C. Romero
in Journal of the Operational Research Society, advance online publication 19 March 2008

Green Planning and the DNC

One of the goals of planners of the upcoming US Democratic National Convention in Denver is to make it a green convention. Among the many operational challenges are energy- and environment-related ones such as minimizing carbon emissions from buses, determining the number of bicycles to have on hand, and how to organize volunteers.

An article in the February 2008 issue of ORMS Today, “Preparing for the Democratic Convention”, talks about these and other of the planning challenges the Convention faces. It mentions that a project-based class at University of Colorado Denver (UCD) led by Harvey Greenberg will be working to find solutions to some of these problems. The course has a website that includes some of the works in progress. For instance, the bike program, which appears to be a kind of ride share, is modeled as an inventory management problem. The goal is to minimize the cost of transferring bikes while meeting bike demand at each location. A final report on the various projects is slated for the May issue.

Some related info:

- The 2004 Republican National Convention in New York had several green features. Read more about that here.

- For more on ride share programs, see this article from carectomy.com.

- The ORMS Today issue mentioned above has articles on community-based OR and OR applied to human rights. It also describes plans for special sessions at the 2008 INFORMS meeting on topics of societal importance. For more on community-based OR, see this informative Punk RockOR post.

MCDM talks

The 2008 Multiple Criteria Decision Making conference (mentioned in this earlier post) occurred. The following talks are relevant to green OR (please send any comments on them if you attended/presented one of these):

Decision support systems based on the life cycle assessment (LCA) for integrated municipal solid waste (MSW) management under uncertainty
B. Bieda

Evaluation of the significant renewable energy resources in India using analytical hierarchy process
A. Bensely

A multiple criteria evaluation approach on the applicability of fuel cell technology alternatives for merchant ships in maritime transportation industry
M. Celik

Analysis of critical evaluation factors of alternative fuel vehicles using
G.H. Tzeng

A multicriteria model for measuring sustainable development
A. Boggia

Application of DEMATEL in economic development issues
M. Khalili Araghi

Designing of local decision making networks towards the extension of sustainable development (Hable-Rud Watershed, Iran)
M. Kazemi

On the potential of multi-objective optimisation in the design of sustainable energy systems
C. Bouvy

Steps towards a corporate evaluation system of environ-mental impacts of offshore petroleum activity
F. Wenstop

MCDM approach on selection of suitable environmental management standard for Turkish ship management companies: EMAS or ISO 14001?
Y. Ilker Topcu

Application of multiple criteria decision analysis in the New Zealand agricultural industry
E. Dooley

See the final program (pdf).

Green Supply Chains

There’s a good post on Michael Trick’s OR blog discussing an extension to ILOG’s supply chain software for measuring the carbon footprint of a supply chain. Follow the links therein, one of which could lead you to the “Green Logistics Webcast Series”, which sounds interesting.

On the subject of green supply chains, here are some additional references:

The Economics of Remanufacturing Under Limited Component Durability and Finite Product Life Cycles
R Geyer, LN Van Wassenhove, A Atasu
in Management Science, January 2007

From Closed-Loop to Sustainable Supply Chains: The WEEE case
J Quariguasi Frota Neto, G Walther, JM Bloemhof
in Erasmus Research Institute of Management (ERIM) Report Series Research in Management

A Model for Assessing the Greenness Effort in a Product Supply Chain
S H’Mida, SY Lakhal
in International Journal of Global Environmental Issues, Vol. 7, No. 1, 2007

Methodology for Reverse Supply Chain Design in Consumer Electronics Industry
S Rajagopalan
Ph.D. dissertation, University of Texas at Austin, 2006

Carbon Dioxide Auctions

Starting in 2011, power plants in several northeast US states participating in the Regional Greenhouse Gas Initiative (RGGI) will have to account for their CO2 emissions. To do so they will be able to purchase carbon emission “allowances” in a series of auctions, the first of which will be on September 10. Initially, the auction format will be single-round, uniform-price, sealed-bid though this may change in the future. A description of the uniform-price auction can be found here. Auctions are a popular area of study in operations research. A post on knowledgeproblem.com goes into some depth on issues surrounding the auction format used in these CO2 auctions. It references a piece by economist Peter Cramton written on behalf of the New England and New York electricity market operators advocating another type of auction (ascending clock).

How much will these allowances cost? The first auction will have a reserve price of $1.86 per ton. One way to find out how many tons of CO2 your local power plant emits is through the carma website. For example, according to carma, the largest CO2 emitter in eastern Connecticut (US) is the AES Thames plant at 1.7 million tons of CO2 per year. Those emissions will cost upwards of $4 million starting in 2011.

This adds another layer to the power companies’ portfolio optimization problems. Do they try to stock up on allowances in the first auction or take a wait-and-see approach?

Some are concerned these costs will be passed on to electric rate-payers. But the hope is that with deregulation, and so customer choice, there will be more incentive for the development of clean energy.

For more information, see the links above and:
- Regional Greenhouse Gas Initiative website
- Carbon dioxide up for sale, Hartford Courant
- RGGI auction rules fire starting pistol on allowance price run-up, Carbon Finance

Renewable Portfolio Standards

Renewable portfolio standards (RPS) set minimum levels of electricity to be produced from renewable energy sources such as wind, biomass, solar, some hydropower and others. The orange states in the US map above are ones with an RPS in place as of June 2007. The image comes from the US DOE’s Office of Energy Efficiency and Renewable Energy (EERE). (Click on it to visit a page about RPS on EERE’s web site.)

As an example, Connecticut started with a requirement of 5% renewables in 2006, which has increased to 10% for 2008, and will continue to increase to a level of 27% by 2020. Failure of an electric distribution company to meet these levels requires a kind of penalty payment ($0.055 per kWh) to the Connecticut Fund for the Environment, which puts the money toward the development of renewable energy sources. Other states have similar arrangements. This link is to a 2005 Massachusetts report on the program there. Among the points made in it are that the program appears to have stimulated the development of new renewable power plants and that 65% of the standard was met by compliance while the remaining 35% was met through the penalty payments.

A federal RPS was in the House version of the 2007 US Energy Bill but it did not survive. Here is a useful earth2tech post on the aftermath of the federal failure to enact a RPS.

In modeling terms, consider an electric power portfolio optimization problem in which a utility must determine the mix of energy generation choices to utilize that will minimize cost while meeting customer demand and numerous other constraints. The sum of the renewable generation megawatt-hours (MWh) sold plus dummy compliance MWh (each having their associated cost per MWh) must be greater than or equal to the current RPS threshold times the total MWh sold by the utility. (Think: transportation problem with penalty for unmet demand at a sink node.)

See also this previous greenOR post about RPS and the lead therein.

Lastly, the following article sounds like it might be interesting and useful -
Weighing the costs and benefits of state renewables portfolio standards in the United States: A comparative analysis of state-level policy impact projections
C. Chen, R. Wiser, A. Mills and M. Bolinger
in Renewable and Sustainable Energy Reviews, in Press, available online as of 4 February 2008
It is a survey and synthesis of a number of different studies on the impact of state RPS plans, focusing mainly on the impact of the RPS on cost of electricity. The authors are from Lawrence Berkeley National Lab. The abstract from Science Direct is available here.

New references

Dynamics of supply chain networks with corporate social responsibility through integrated environmental decision-making
Jose M. Cruz
in European Journal of Operational Research, Volume 184, Issue 3, Pages 817-1190 (1 February 2008 ) Pages 1005-1031

A methodology for assessing eco-efficiency in logistics networks
J. Quariguasi Frota Neto, G. Walther, J. Bloemhof, J.A.E.E. van Nunen and T. Spengler
in European Journal of Operational Research, in press, available online as of October 2007
Notes: Studies the efficient frontier between environmental and business concerns.

A multiple objective model to deal with economy-energy-environment interactions
C. Oliveira and C.H. Antunes
in European Journal of Operational Research, 153 (2), p.370-385, Mar 2004

Wind Energy and Linear Programming

WinDS is a tool for modeling the expansion of wind electric generation and transmission capacity. Developed by the US National Renewable Energy Laboratory (NREL), it passes information from a Geographic Information System (GIS) into a linear program. The WinDS site has several documents about the tool including a detailed description of the linear program. The objective is to minimize the various costs (capital, operating, transmission, etc.). It requires a five page listing, not including definitions. While stepping through the entire LP formulation would be quite time-consuming, one could certainly learn a great deal about the deployment of wind energy by doing so.

Update (2/16/08):
There is now a story about WinDS featured on the home page of NREL’s web site.