Sustainable and Resilient Capacity Expansion Planning for Chemical Processing Industry: A Bi-Objective Approach

Abstract

According to United Nations reports, the worldwide population is expected to reach around 9.6 billion by 2050. This forecast emphasizes the critical role of energy and raw materials that are needed to meet the tremendous demand for goods. Consequently, firms feel pressured to establish sustainable and resilient strategic plans to acquire new process technologies and expand their capacity on time. These decisions are made at the highest management level, supported by a set of capacity expansion portfolios, to improve their competitiveness, especially in capital-intensive industries such as chemical processing. This paper investigates the sustainable and resilient capacity expansion problem for such industries within a long-term horizon. The main objective is to develop a holistic capacity expansion planning framework that fits the chemical processing industries and can be used to generate resilient scenarios while enhancing their sustainability measures. To this end, a bi-objective mixed-integer programming model was developed to solve the sustainability–resilience–profitability dilemma. The results showed a controversial relationship between the profitability of capacity expansion investments and a company’s commitment to sustainability and resilience. Furthermore, capacity expansion decisions were shown to primarily depend on the importance assigned to maximize profit as a managerial choice. However, there is no clear trend in sustainability preferences based on the sustainability weighting choice.