Inventory Control for Peak Electricity Demand Reduction of Manufacturing Systems Considering the Tradeoff Between Production Loss and Energy Savings

Abstract

The effective reduction of the electricity consumption during peak periods plays a critical role in reducing the cost and improving the reliability of the operation of power grid. The unbalanced situation between the supply and the demand of the electricity during peak periods can be relieved. The need for installing and running some peaking power plants and associated power delivery infrastructure can be partially avoided. This paper proposes an analytical model focusing on the electricity load management aiming at reducing the electricity consumption during peak periods by buffer inventory control for the typical manufacturing systems with multiple machines and buffers. Compared with the previous research that is strictly under the constraint of the throughput of manufacturing systems, this research is advanced by considering the tradeoff between the penalty due to production loss and the benefit resulted from energy savings, and thus more load management options are available. The optimal load management actions and corresponding buffer inventory control policies for the whole system are identified by minimizing the summation of the buffer inventory holding cost, electricity consumption cost, and potential production loss penalty throughout the production horizon. A numerical case study based on an automotive assembly line is used to illustrate the effectiveness of the proposed method.

Department(s)

Engineering Management and Systems Engineering

Keywords and Phrases

Electricity Load Management; Inventory Control; Peak Electricity Demand; Tradeoff Between Production Loss And Energy Savings

International Standard Serial Number (ISSN)

0959-6526; 1879-1786

Document Type

Article - Journal

Document Version

Citation

File Type

text

Language(s)

English

Rights

© 2014 Elsevier, All rights reserved.

Publication Date

01 Nov 2014

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