Economic Analysis of an Integrated Production–Inventory System under Stochastic Production Capacity and Energy Consumption

Iqra Asghar, Biswajit Sarkar and Sung-jun Kim
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Iqra Asghar: Department of Industrial and Management Engineering, Hanyang University, Ansan Gyeonggi-do 15588, Korea
Biswajit Sarkar: Department of Industrial and Management Engineering, Hanyang University, Ansan Gyeonggi-do 15588, Korea
Sung-jun Kim: Department of Industrial and Management Engineering, Hanyang University, Ansan Gyeonggi-do 15588, Korea

Energies, 2019, vol. 12, issue 16, 1-27

Abstract: Expensive power cost is a significant concern in today’s manufacturing world. Reduction in energy consumption is an ultimate measure towards achieving manufacturing efficiency and emissions control. In the existing literature of scheduling problems, the consumption of energy is considered uncertain under the dimensions of uncertain demand and supply. In reality, it is a random parameter that also depends on production capacity, manufacturing technology, and operational condition of the manufacturing system. As the unit production cost varies with production rate and reliability of the manufacturing system, the energy consumption of the system also varies accordingly. Therefore, this study investigated an unreliable manufacturing system under stochastic production capacities and energy consumption. A stochastic production–inventory policy is developed to optimize production quantity, production rate, and manufacturing reliability under variable energy consumption costs. As energy consumption varies in different operational states of manufacturing, we consider three specific states of power consumption, namely working, idle, and repair time, for an integrated production–maintenance model. The considered production system is subjected to stochastic failure and repair time, where productivity and manufacturing reliability is improved through additional technology investment. The robustness of the model is shown through numerical example, comparative study, and sensitivity analysis of model parameters. Several graphical illustrations are also provided to obtain meaningful managerial insights.

Keywords: stochastic production capacity; unreliable production system; energy; random failure and repair rates; controllable production rate (search for similar items in EconPapers)
JEL-codes: Q Q0 Q4 Q40 Q41 Q42 Q43 Q47 Q48 Q49 (search for similar items in EconPapers)
Date: 2019
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (4)

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