Stochastic model-based framework for assessment of sustainable manufacturing technology

Abstract

In recent years, manufacturing companies have been continually required to minimize energy usage, pollutant emissions, manufacturing costs and lead-time. Therefore most companies have realized the necessity of investing in green manufacturing technology. However, it is difficult to evaluate the benefit of a green technology investment. Although several technology evaluation and assessment methods have been developed, these methods are unsuitable for evaluating alternative green technologies and their long-term benefits. Moreover, estimating the future cash flow of a type of technology, which is one of the most important factors, is a difficult task since energy prices and environmental regulations have major uncertainties. Unfortunately, most technology evaluation methods do not currently consider future cash flows. In this research, we designed a new framework that can be used to evaluate green technology investment based on stochastic model; two investment cases were then evaluated using the framework to verify the reliability of the evaluation result and the framework usability.