Optimization of Industrial Operations with Environmental Consideration

  • Noura Dhaheri

Student thesis: Master's Thesis


The present debate over global warming focuses on the nature and magnitude of anthropogenic emissions and on the best policy response to reduce these emissions. In this context, several policies to reduce greenhouse gas (GHG) emissions and more specifically carbon dioxide (CO2) emissions have been proposed. These include carbon trading, free market environmentalism and other approaches that provide an infrastructure to support the necessary mechanisms to reduce emissions while taking into account their economic impact. These policies can be based on reducing emissions from existing technologies or the deployment of new clean technologies. In this thesis, mathematical programming is used to produce more sustainable solutions to two real-world problems. The first problem is to construct a mathematical model that will integrate planning, the use of CO2 mitigation options and carbon trading mechanisms into the petroleum refining sector. In this problem, an existing oil refinery planning model is extended to select from different alternative CO2 mitigation options the best strategy or set of strategies that will conform to environmental regulations while achieving maximum profit for the oil refinery, and at the same time meeting customer demand without compromising final product quality. The second problem concerns the formulation of novel supply chain management models for the traditional inventory-location problem. We consider a supply chain management model for the inventory-location problem for multiple products under capacity and environmental constraints. This model decides the locations of warehouses from a set of candidate locations and the inventory policy at each warehouse so that customer demand for multiple products is met at minimum cost while at the same time respecting environmental constraints by taking advantage of the flexibility of a carbon trading mechanism. Both models were implemented in GAMS (The General Algebraic Modeling System) and computational studies were performed to determine their implications for policy.
Date of Award2011
Original languageAmerican English
SupervisorAli Diabat (Supervisor)


  • Industrial Organization

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