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Carbon Capture, Mitigation, Storage

and Alternate Usage in Supply Chains

Abstract
CO2 capture, optimal energy usage, global warming confront every firm who realize importance of
corporate social responsibility on carbon reduction. To meet this objective, high level of
attention, detailed planning and steering of complete end-to-end logistics chains. Some current
foci of environmentally acceptable and friendly supply chain objectives involve carbon control of
assets and infrastructure, energy efficient usage of transporters, waste reduction through
process optimization, and sustainable recycling. This is in addition to traditional supply chain
aims of cost minimization, inventory reduction, and network optimization. Indeed, controlling for
carbon, measuring CO2 emissions, capturing emissions and relying on alternative usage in a
supply chain challenges firms. Need to quantify and rigorously analyze impact of heat (carbon)
yielding “devices” within supply chain.
Literature on importance of and need for green supply chains is growing vis-à-vis publication rate
and volume (Lamming and Hampson (1996), Beamen (1999), Udel (2006), Hoffman, (2007),
Parry et al. (2007). Few articles discuss model based green supply chains (Sheu et al.(2005),
Simpson et al. (2007), Zhu and Zarkis (2007), Srivastara (2007) and Zhu et al. (2008)).
Hence, we seek to determine and examine various “heat” transfer devices within supply chain, to
measure direct and indirect “heat emitting nodes” and “heat link” across entities, stages and
processes of supply chain to highlight intensity and downstream effects of carbon emissions
across entire supply chain network so as to understand heat flux and carbon emissions at each
node and calculate total heat (and hence carbon) transferred between stages. Through this, we
can decide what and where are areas of sensible heat flux and acceptable carbon emissions.
Next, we test alternative methods, alternate usage and modes of distribution, and quantifying
potential emissions reduction and develop plans to reduce carbon emissions by modifying
transport and facility usage. We triangulate (analytical and empirical approaches) to better
appreciate evolution of green supply chain.
Prelim results suggest heat and carbon influencers as: (i) transport mode, (ii) inventory policy, (iii)
network structure, (iv) trade policy, (v) consumer density, (vi) traffic congestion, and (viii)
technology in use. We normalize heat links by three tier color coded temperature states: green
(acceptable carbon emissions), amber (borderline emissions) and red unacceptable). We want to
offer strategies to mitigate carbon emissions across supply chain. Research is useful as it
suggests areas pertaining to innovation in logistics services and environmental economic
tradeoffs, for logistics firms in Asia and Singapore as logistics hub.

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Introduction
• Traditional supply chain:
– Cost minimization, inventory reduction, and network
optimization
• Environmentally friendly supply chain:
– Carbon control of assets and infrastructure, energy
efficient usage of transporters, waste reduction
through process optimization, and sustainable
recycling
• Challenge:
– Control carbon, measure CO2 emissions, capture
emissions and provide alternative usage in supply
chain
• Objective:
– Quantify and rigorously analyze impact of heat
(carbon) yielding “devices” within supply chain
Discover  Design  Deliver

Drivers of Green Supply Chain


Energy Use
Technology Use Network density & route

CO2
emissions
i. Mode of
Transport
ii. Inventory Policy Supply Chain Node

iii. Network Product In Product


Structure Out

iv. Trade Policy


v. Consumer
Density
vi. Traffic
Inventory Policy Shipment Policy
Congestion
Trade Policy
vii. Technology in Intensity of Heat Flux
Use

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What does green really mean

Green Supply
+ Green Forward and Reverse Logistics
Green Supply Chain* = + Green Manufacturing
+ Green Packaging and Distribution
+ Green Consumption
+ Green Recycling

Automotive Supply Chain with green focus

*Adapted from Hervani et al. (2005)

Literature

• Importance of green supply chain and its


necessity (Lamming &Hampson, 1996; Beamen,
1999; EPA, 2000; Udel, 2006; Hoffman, 2007;
Parry et al., 2007 )
– Current research qualitative - interview, and
case-based
– Lack of model based studies on this issue
– Lack of CO2 capture in supply chain and
logistical issues
– Gap in looking for feasible alternate usage
– Lack of published reports on recycling, reusage
and refurbishing

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Research Problem
Research Questions:
RQ1: What methods are available to measure impact of carbon
footprint across supply chain?
RQ2: How to ensure that our partners have our green interests
in mind, without risk of decrease in efficiency or agility?
RQ3: How to design carbon neutral supply chain network?
RQ4: Do regulatory issues affect logistics operation and
pressurize on green logistics?

Research Approach:
A1: Lagrangian based model to measure carbon footprint
A2: System Dynamics based analysis to understand cause
and effect

Research Design
• Measure direct and indirect emissions from “heat
emitting nodes” and “heat link” across entities, stages
and processes of the supply chain
• Performing life cycle analysis
• Capture emissions at raw material processing,
manufacturing, assembly, storage and distribution
stages
• Mitigate emissions by innovative methodologies
- % CO2 reduction, % greenhouse gas reduction, %
savings in kwh energy consumption, % recycling
• Feasibility for alternative methods
- Energy efficient supply network
- Alternate mode of transport
- Nature friendly combustion technology
- Carbon neutral design

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Emission Measurement Model
Consider modified Lagrangian transport model (Lee, 2000)
dcx v *c
= E + R(c) − − Λc
dt z
Where,
E is the emission rate in kg/s
R(c) is the rate of change of footprint
v is dry deposition velocity in m/s
Λ is coefficien t of carbon deposition in s-1
Z is height factor in m
c is the amount of carbon deposit in kg
“emission rate” is calculated from total heat emission of all sources

Totalheat flux (q) = {CO2 + CH4 + HFCS + N2O + PFCS + SF6 }

MODELS TO MEASURE CAUSAL BEHAVIOR


Existing:
• Behavioral decision model: Forrester 1961, Simon
1979, Sterman 1980
• Climate economy model: Yohe 1983, Nordhaus
1992, de Vries and Janssen 1996, Fiddaman 1996
• Energy economy model: Beaver 1993, Fisher-
Vanden 1995, Dowlarabadi 1995
• Carbon capture and storage related to structural,
economic and ecological aspects by Viebahn et al.
(2008), Baeza et al. (2008)

Proposed:
• SD model to understand carbon-energy-economy
causality
• SD model to understand carbon economics tradeoff

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Intended Applications
Key Issues:
• Developed considering
automotive supply chain
Korea/Thailand - Suppliers • Supplier side: Environmental
impact
• Manufacturing and logistics:
Acceptable
Environmental impact is very
Detroit
China (Manufacturers)
Carbon Emission
high due to high energy
Borderline
consumption
Carbon Emission
Focus:
Unacceptable
Carbon Emission
• Green Supply and Purchasing
Chennai
policies
Singapore (DCs) Hongkong (Dcs)
• Impact of Environmental
Regulations on Trade and
Logistics issues
Middle and West Australia Indonesia Taipei
• Leverage Innovation in
Asian Countries
(Consumer)
(Consumer) (Consumer) (Consumer) Logistics Services
• Environmental and Economic
Tradeoffs
Capture CO2 and Greenhouse gases from all heat emitting nodes and
heat links and looking for alternate usages

Mitigating carbon emissions

• Innovate at design level


• Proper supplier selection
• Green supply and purchasing policies
• Environmental regulations for transshipment
• Regulate carbon levels at manufacturing
• Leverage green innovation for logistics services
• Reduce inventory and increase visibility at distribution level
• Green packaging and distribution strategies
• Policy to reduce, reuse, recycle policy
• Create consumer awareness