Optimizing sustainable multimodal distribution networks in the context of carbon pricing, with a case study in the Thai sugar industry

Abstract

Transportation is a major cause of energy consumption and emissions which can be reduced by optimizing routings and using alternative modes of transport. This paper relates to the strategic design of multimodal transportation networks. It presents a general model of green vehicle routing problems that supports strategic decision-making by identifying optimal solutions and provides data on costs and emissions. Three general linear programming models were developed that optimize multimodal distribution networks that could be applied in many industries. Model I evaluates carbon emissions; model II assesses carbon emissions and capacity constraints; and model III establishes total costs including transportation, handling, storage, fuel and carbon costs.Thailand is the third largest world sugar exporter in the world and is piloting carbon pricing, which will affect energy intensive industries, including the sugar industry. The models are applied using data obtained from a collaborating company. The research contributed to practice by informing managerial decisions relating to the export of sugar from the factory. This included evaluating the possible use of a dry port with rail connections, which could reduce transportation and carbon costs by 54.3% and facilitate the building of another factory to increase exports.