OR Practice—A Utility Fuel Inventory Model

Peter A. Morris, M. James Sandling, Richard B. Fancher, Michael A. Kohn, Hung-Po Chao and Stephen W. Chapel
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Peter A. Morris: Applied Decision Analysis, Inc., Menlo Park, California
M. James Sandling: Applied Decision Analysis, Inc., Menlo Park, California
Richard B. Fancher: Decision Focus Inc., Los Altos, California
Michael A. Kohn: Decision Focus Inc., Los Altos, California
Hung-Po Chao: Electric Power Research Institute, Palo Alto, California
Stephen W. Chapel: Electric Power Research Institute, Palo Alto, California

Operations Research, 1987, vol. 35, issue 2, 169-184

Abstract: The Utility Fuel Inventory Model (UFIM) is an inventory modeling system designed to help electric utilities set long-term fuel inventory strategy. It is currently in use by more than 50 utilities. This paper describes the model, its use and one of its first applications. The paper has several objectives: (i) to illustrate the value of integrating different model forms—both analytical and simulation—to solve a complex multiple-issue decision problem; (ii) to illustrate a process for using the model to help the user understand the inventory problem; (iii) to illustrate the use of auxiliary simplified models to build insight and to complement judgment; and (iv) to document an application demonstrating significant cost savings for the electric utility industry.

Keywords: 331 inventory planning; 332 inventory application (search for similar items in EconPapers)
Date: 1987
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Persistent link: https://EconPapers.repec.org/RePEc:inm:oropre:v:35:y:1987:i:2:p:169-184

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