Reliable distribution networks design with nonlinear fortification function

Qingwei Li and Alex Savachkin

International Journal of Systems Science, 2016, vol. 47, issue 4, 805-813

Abstract: Distribution networks have been facing an increased exposure to the risk of unpredicted disruptions causing significant economic losses. The current literature features a limited number of studies considering fortification of network facilities. In this paper, we develop a reliable uncapacitated fixed-charge location model with fortification to support the design of distribution networks. The model considers heterogeneous facility failure probabilities, one layer of supplier backup, and facility fortification within a finite budget. Facility reliability improvement is modelled as a nonlinear function of fortification investment. The problem is formulated as a nonlinear mixed integer programming model proven to be NP$\mathcal {NP}$-hard. A Lagrangian relaxation-based heuristic algorithm is developed and its computational efficiency for solving large-scale problems is demonstrated.

Date: 2016
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DOI: 10.1080/00207721.2014.906682

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