Sustainable Electrical Energy Supply Chain System With Hybrid Power Generation: An Inventory Approach

In this paper, we present a sustainable electrical energy supply chain system (SEESCS) where two supply chain parties are involved, namely a power plant and a transmission station. The power plant has two different types of power generation systems. The first power generation system (PG1) is more costly but it generates lower emissions than the second system (PG2). The model is developed based on a lot-sizing inventory problem to decide the load allocation between PG1 and PG2. The objective function is to minimize total costs that consist of energy generation cost and emission cost. The transmission station faces a stochastic demand and employs a continuous review policy to manage the electrical energy storage. An efficient procedure is developed to solve the model and a sensitivity analysis is carried out to explore the impact of changes in some key parameters on the model’s behavior. The results show that the allocation of electricity generation is mostly influenced by the change in PG1’s production cost parameter and PG2’s emissions parameters. The amount of emissions generated from the system is significantly affected by the variation in PG1’s production cost parameter, PG2’s emissions parameters, and electricity demand. Furthermore, by adjusting the power supply rate of power generation, the supply chain can control the overall emissions produced and maintain the total cost.