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The Effect of Price-Dependent Demand on the Sustainable Electrical Energy Supply Chain

Ivan Darma Wangsa (), Tao Ming Yang () and Hui Ming Wee ()
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Ivan Darma Wangsa: Department of Industrial and Systems Engineering, Chung Yuan Christian University, Taoyuan 32023, Taiwan
Tao Ming Yang: Department of Industrial and Systems Engineering, Chung Yuan Christian University, Taoyuan 32023, Taiwan
Hui Ming Wee: Department of Industrial and Systems Engineering, Chung Yuan Christian University, Taoyuan 32023, Taiwan

Energies, 2018, vol. 11, issue 7, 1-18

Abstract: In order to identify the optimal structure of an electricity power network under the main assumption of a price dependent demand of electrical energy, we presented an optimization model that aims at analyzing the effect of price-dependent demand on the sustainable electrical supply chain system (SESCS). The system included a power generation system, transmission and distribution substations, and many customers. The electrical energy was generated and transmitted through multiple substations to our customers, and the demand for electricity by the customers is dependent on the price of electricity. In the study, we considered the transmission and the distribution costs which depend on the capacities of power generation, transmission rates and distances between stations. We utilized the inventory theory to develop our model and proposed a procedure to derive an optimal solution for this problem. Finally, numerical examples and sensitivity analysis are provided to illustrate our study and consolidate managerial insights.

Keywords: sustainable electrical energy supply chain; inventory theory; transmission and distribution costs; price-dependent demand (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: 2018
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