Three-level sustainable supply chain model with cap-and-trade policy and green technology

Animesh Middya (), Magfura Pervin (), Leonidas Sakalauskas (), Sankar Kumar Roy () and Gerhard-Wilhelm Weber ()
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Animesh Middya: Bagnan College
Magfura Pervin: Bangabasi Evening College
Leonidas Sakalauskas: Vytautas Magnus University
Sankar Kumar Roy: Vidyasagar University
Gerhard-Wilhelm Weber: Poznan University of Technology

Operational Research, 2026, vol. 26, issue 1, No 6, 41 pages

Abstract: Abstract This study proposes a sustainable model involving a single supplier, a logistics provider, and multiple retailers. The presented model incorporates deteriorating items by accounting for carbon emissions with green technology investment. Emissions arising from inventory storage, transportation, and storage of deteriorating items. To minimize both production and overall system costs, the supplier adopts discrete setup cost reduction. The paper evaluates the effectiveness of green technology investment within a supply chain model under the effect of a cap-and-trade policy. Preservation technology is also applied to mitigate item deterioration. Economic sustainability is maintained by minimizing total cost via optimized shipments, setup cost reduction, cycle time, and investments in preservation and green technologies. Environmental sustainability is preserved through carbon emission reduction and the implementation of green technology, while social sustainability is supported by ensuring a healthier, low-carbon environment for future generations. Sensitivity analysis is performed and graphical representations are provided to evaluate the effectiveness of key parameters in the study. An important perspective of the study is on reducing carbon emissions while minimizing total cost. Numerical experiments illustrate that a global optimum solution is obtained at the optimum values of the decision variables, and carbon emission reduction is sustained. This study contributes to sustainable supply chain research in developing countries by exploring investment strategies such as green technology implementation, cap-and-trade policies, and preservation technology to reduce product deterioration and emissions.

Keywords: Sustainable supply chain; Setup cost reduction; Green technology; Cap-and-trade policy; Deterioration; Preservation technology; Single-setup-multi-delivery policy (search for similar items in EconPapers)
Date: 2026
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DOI: 10.1007/s12351-025-00998-y

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