Study of Green-Ship Routing Problem (G-VRP) Optimization for Indonesia LNG Distribution

Abstract

Natural gas is distributed around Indonesia mainly to be used as fuel in electrical power plants. The increase of consumption of electricity in Indonesia is on average of 6.8% annually. In response, the government considers developing gas power plants in central parts of Indonesia. As an archipelago, Indonesia depends heavily in connectivity between islands which is obviously supported by seaborne vessels or ships. These facts make the LNG transportation a complex matter in Indonesia. The distribution of LNG by ship can be designed as a hub and spokes liner shipping. A single hub and spokes network has one hub port and several feeder ports. In LNG supply chain network, the hub is the liquefaction plant and the feeder ports are receiving terminals. Various optimization methods have been established to optimally utilize a fleet. Other than the cost-efficiency, there are other considerations in optimizing the fleet. One of the current trending considerations is the emission. In the past few years, concern about environment has been increasing. IMO released a number based on research that shows that maritime transportation has 2.7% contribution to global anthropogenic emission. The aim of this research is to determine the optimal fleet and its routes of an LNG shipping to minimize the CO2 emission while also minimizing the cost of LNG distribution in central part of Indonesia that covers South Eastern Sulawesi. Demand points are the power plants of Kendari, Baubau, Selayar, Bombana, and Kolaka with a total of 828 m3 daily needs for LNG. The cost calculation was done in a G-VRP framework which took emission into account. A method called Bin Packing Problem within the context of Vehicle Routing Problem was established to minimize the total distribution cost and emission for each cluster. After acquiring the best route and fleet option, this research compared and analysed the benefits of using conventional diesel engine and a dual fuel diesel engine scenario for the chosen vessel. The result of this optimization study shown that the transportation shall use one unit of type-A ships with a capacity of 1100 m3 for the routes Ambon-Bombana-Kolaka Utara-Ambon. And two units of type-B ship with a capacity of 2500 m3 for Ambon-Kendari-Ambon and Ambon-Baubau-Selayar-Ambon route. All ships use LNG as fuel. The total expense for this scenario is $2,980,768.63 and the use of dual fuel diesel engine instead of a conventional diesel engine for the ships can reduce the total costs by $2,434,348.97 or 44.95%.