Optimal integration of electricity supply chain and sustainable closed-loop supply chain

Abstract

This study presents an innovative multi-objective robust mixed-integer linear model to integrate an original capacitated Electricity Supply Chain (ESC) and a Closed-Loop Supply Chain (CLSC). The multifaceted relationships between the three dimensions of sustainability, different Carbon Emission Schemes (CES), and robustness have been carefully examined considering the Decision Maker’s (DM’s) various risk preferences. Results demonstrate the direct effect of the selected CES on the network configuration. Under each CES, the total cost increases by increasing the conservatism of the DM. At lower carbon emission capacity, the Carbon Cap Policy (CCP) has lower emissions at the highest cost compared to other policies. However, the emission capacity does not affect the emission under the Carbon Tax Policy (CTP) and Carbon Cap and Trade Policy (CCTP) but increases the network cost in both policies. A conservative DM is willing to adopt CTP with lower cost and emission at a higher emission capacity. At any level of emission capacity, CCTP has a higher priority than CTP only for non-conservative carbon-sensitive DM. The higher the DM conservatism, the lower the carbon credits sold under the CCTP, and the higher the need to purchase credits. Contrary to the insignificant effect of CESs, increasing the DM’s conservatism improves the robustness.