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European Journal of Operational Research 227 (2013) 142–151

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European Journal of Operational Research


journal homepage: www.elsevier.com/locate/ejor

Innovative Applications of O.R.

An arc cover–path-cover formulation and strategic analysis


of alternative-fuel station locations
Ismail Capar a,⇑, Michael Kuby b, V. Jorge Leon c,d, Yu-Jiun Tsai d
a
Industrial Distribution Program, Texas A&M University, TAMU 3367, College Station, TX 77843, USA
b
School of Geographical Sciences and Urban Planning, Arizona State University, Tempe, AZ 85287, USA
c
Department of Engineering Technology and Industrial Distribution, Texas A&M University, College Station, TX 77843, USA
d
Department of Industrial and Systems Engineering, Texas A&M University, College Station, TX 77843, USA

a r t i c l e i n f o a b s t r a c t

Article history: In this study, we present a new formulation of the generalized flow-refueling location model that takes
Received 3 April 2012 vehicle range and trips between origin–destination pairs into account. The new formulation, based on
Accepted 19 November 2012 covering the arcs that comprise each path, is more computationally efficient than previous formulations
Available online 5 December 2012
or heuristics. Next, we use the new formulation to provide managerial insights for some key concerns of
the industry, such as: whether infrastructure deployment should focus on locating clusters of facilities
Keywords: serving independent regions or connecting these regions by network of facilities; what is the impact of
Flow refueling
uncertainty in the origin–destination demand forecast; whether station locations will remain optimal
Alternative-fuel vehicle
Electric vehicle
as higher-range vehicles are introduced; and whether infrastructure developers should be willing to
Fuel station location pay more for stations at higher-cost intersections. Experiments with real and random data sets are
Fueling infrastructure encouraging for the industry, as optimal locations tend to be robust under various conditions.
Published by Elsevier B.V.

1. Introduction Motivated by the need to develop infrastructure to facilitate


adoption of AFVs, this paper introduces a new efficient formulation
In response to concerns about oil prices and environmental for the problem of locating a set of facilities to refuel round trips
problems, automotive companies have started to commercialize between origin–destination (OD) pairs while considering the lim-
alternative-fuel vehicles (AFVs) using forms of energy such as com- ited driving range of vehicles. Second, utilizing the new model,
pressed natural gas (CNG), liquefied petroleum gas (LPG, or pro- key strategic questions regarding the deployment of alternative-
pane), hydrogen, biodiesel, ethanol, and electric vehicles (EVs). fuel stations (AFSs) are studied. These questions address issues
Initial inroads into the consumer marketplace were led by flex-fuel such as: whether infrastructure deployment should focus on locat-
vehicles that can burn gasoline or ethanol (or diesel or biodiesel), ing clusters of facilities serving independent regions or connecting
and by gas-electric hybrids. However, some original equipment these regions by network of facilities; whether station locations
manufacturers have introduced pure AFVs that cannot refuel at will remain optimal as higher-range vehicles are introduced; what
ubiquitous gas or diesel stations when running low, including the is the impact of uncertainty in the origin–destination demand fore-
Honda Civic GX which runs on CNG, Honda FCX Clarity that runs cast; and whether infrastructure developers should be willing to
on hydrogen, and a variety of all-electric models. pay more for stations at higher-cost intersections.
Studies have shown that lack of refueling infrastructure is one of
the most important disadvantages that AFVs face even when they
have similar range and safety perception to gasoline vehicles 2. Literature review
(Melendez and Milbrandt, 2006a,b; Melendez et al., 2007). Hence,
building an easily accessible network of service stations where AFVs This study is related to several streams of research on facility
can be refueled would promote more widespread use. Otherwise, location optimization: the p-median, maximal covering, network
AFVs will be mostly available to early adopters with high incomes interdiction, network sensor, flow interception, and flow refueling
who can afford to buy a secondary vehicle for use on a limited num- problems.
ber of feasible trips. Private companies and public agencies have be- The p-median model minimizes the total weighted distance
gun deploying stations in many countries around the world. travelled from each demand node to the closest built facility
(Hakimi, 1964; ReVelle and Swain, 1970). Nicholas et al. (2004),
⇑ Corresponding author. Tel.: +1 979 862 8312; fax: +1 979 845 4980. Nicholas and Ogden (2006), and Greene et al. (2008) applied the
E-mail address: capar@tamu.edu (I. Capar). p-median model to locate fuel stations using heuristics. Lin et al.

0377-2217/$ - see front matter Published by Elsevier B.V.


http://dx.doi.org/10.1016/j.ejor.2012.11.033
I. Capar et al. / European Journal of Operational Research 227 (2013) 142–151 143

Notation

Indexes and sets Parameters


N set of nodes constituting the transportation network R the range of vehicles
N = {1, 2, . . . , n} fq volume of traffic flow on path q
M the set of origin–destination nodes where M # N p the number of stations to be located
i, j, k indexes for potential facilities/candidate sites/nodes
q the index for OD pairs (and the path between them) Decision variables
Q the set of OD pairs zi binary variable; 1 if service station is built at node i, 0
aj,k a directional arc starting from node j and ending at node otherwise
k yq binary variable; 1 if the flow on path q is refueled, 0
Aq set of directional arcs on path q, sorted from origin to otherwise
destination and back to origin
K qj;k set of candidate sites, which can refuel the directional
arc aj,k in Aq

(2008) also used an approach similar to the p-median model but for pre-generation of facility combinations that can cover longer
considered vehicle-miles traveled rather than population to weight paths by incorporating the FRLP’s underlying logic into the con-
the demand nodes. Goodchild and Noronha (1987) use the p-med- straints. Their formulation solves as fast as or faster than the heu-
ian as one of the objectives in a multi-objective model to maximize ristic approaches presented by Lim and Kuby (2010).
the market share of a refueling firm. While these new approaches to formulate the FRLP overcame
The goal of max covering location problem (MCLP) is to locate p shortcomings of the original Kuby and Lim (2005) formulation,
facilities on a network while maximizing the total population at there is substantial room for improvement. The Capar and Kuby
stationary nodes covered by facilities located within a given dis- (2012) approach requires a large number of new variables and con-
tance or travel time (Church and ReVelle, 1974). The basic MCLP, straints—as well as different types of variables and constraints—to
in which only a single location is required to serve a node, cannot enforce the exact same covering rules for round trips. In addition,
address incidents requiring response of multiple units (Green, Wang and Lin (2009) and Wang and Wang (2010) formulations
1984). Consequently, Hogan and ReVelle (1986) extended the ini- explicitly consider the trips of individual vehicles and needs addi-
tial MCLP model to incorporate backup coverage. Batta and Man- tional input about the initial fuel level at the beginning of a trip.
nur (1990) also proposed a model to locate several facilities to Their models use a vehicle refueling constraint that ‘‘shows the
serve a node, but it addresses neither the spatial relationship remaining fuel at a station equals the remaining fuel plus the refu-
among facilities nor paths through a network. eling at the prior station minus the fuel consumption between
In contrast, Hodgson (1990) and Berman et al. (1992) consider them’’ (Wang and Lin, 2009). Their numerical experiments as-
traffic flow passing by as the primary demand for businesses such sumed vehicles start with a full tank (e.g. home refueling), though
as convenience stores, gasoline stations, fast-food restaurants, and the model can handle any assumption about the initial fuel level.
billboards. The flow-intercepting location problem (FILP) locates In addition to the computational issues discussed above,
facilities to serve traffic flows that can be intercepted or captured researchers have applied the flow-refueling location model (FRLM)
if the flow starts, ends, or passes by an open facility. Readers are to several strategic issues. Upchurch et al. (2009) developed a
referred to Zeng et al. (2010) for a recent review of FILP and its capacitated formulation for the FRLM. Upchurch and Kuby (2010)
extensions. compared the FRLM and the p-median model and found that the
Kuby and Lim (2005) tackled the requirement of visiting multi- p-median model is more likely to favor denser clusters of popula-
ple service stations along a path by pointing out that the FILP mod- tion whereas the FRLM favors intersections where large flow vol-
el is not applicable if vehicles have a short range compared to their umes can be intercepted.
length of trips. They introduced the flow-refueling location prob- Finally, the FRLM has some similarities and differences with
lem (FRLP), which explicitly takes the range of vehicles into consid- network sensor and interdiction problems. In location problems
eration and locates p facilities to maximize the traffic flow in sensor networks, the objective involves counting or identifying
captured. Although their MIP formulation has been successfully moving objects through the network (Liu and Towsley, 2004). Var-
applied to small networks, Lim and Kuby (2010) showed that a ious types of sensors and problem types have been studied, with the
pre-processing stage used to generate all the combinations of facil- most relevant being optimal location of path ID and vehicle ID sen-
ities that can refuel a path is computationally burdensome, and it is sors (Gentili and Mirchandani, 2012). Network sensor problems,
therefore practically impossible to use for large-scale problems. however, do not have to account for the entirety of every arc along
They therefore proposed greedy, greedy substitution, and genetic detected paths, whereas the FRLM requires an approach that can
algorithms to solve larger problems. project coverage forward along a path by only a limited distance
Other authors have recently developed FRLP extensions and (the range of vehicles) and must account for the entire length of
alternative solution methods that continue to employ path-based any covered path. Less closely related is the network interdiction
demands that may need to be covered by more than one station problem, which aims to eliminate a subset of arcs from a network
based on the vehicle driving range. Wang and Lin (2009) proposed to minimize the amount of flow that is able to pass through the net-
a set-covering FRLP to minimize the cost of facilities while refuel- work from a single origin to a single destination, subject to a budget
ing 100% of the traffic. Their approach imposes the range restric- constraint (Altner et al., 2010; Cappanera and Scaparra, 2011).
tion by keeping track explicitly of the fuel remaining on each
vehicle at each node on the path. Wang and Wang (2010) extended 3. Problem definition and formulation
Wang and Lin’s (2009) model to a multi-objective case, where the
second objective is to maximize the flow covered. Capar and Kuby The objective of the FRLP is to locate p facilities on a network to
(2012) proposed a new FRLP formulation that eliminates the need maximize the traffic flow refueled given the range of vehicles.
144 I. Capar et al. / European Journal of Operational Research 227 (2013) 142–151

(Note that we use the words ‘‘refueled,’’ ‘‘recharged,’’ and ‘‘served’’ node, the model will consider that trips starting from the origin
interchangeably, as well as ‘‘tank’’ or ‘‘battery’’.) A traffic flow is node will have full fuel tank or battery, but if there is no existing
considered as refueled if vehicles starting from the origin can reach station at the origin, trips will start with the remaining fuel from
the destination and return to the origin without running out of the last fill-up on the same path. Assuming symmetrical energy
fuel. The following paragraphs discuss the modeling assumptions, consumption in both directions of each arc, the approach taken
explain how different factors impact successful completion of here will also ensure that every trip starts with at least half a tank,
round trips using a simple example, and present the modeling but the new approach is superior in that it can be modified to deal
notation. with asymmetrical energy consumption. This approach also con-
The problem presented in this section is formulated by utilizing trasts with that of Wang and Lin (2009), which is both more flex-
assumptions common to FILP/FRLP-related research (e.g. Hodgson, ible in the sense that the user can specify any initial tank level,
1990; Berman et al., 1995; Kuby and Lim, 2005; Zeng et al., 2010; and more limiting in the sense that it must assume some starting
Capar and Kuby, 2012). These assumptions are: (1) the traffic be- fuel amount.
tween an OD pair flows through a single path (typically the short- In the FRLP, successful completion of a round trip depends on
est or least-travel-time path); (2) the traffic volume between OD factors such as structure of the highway network, location of AFSs,
pairs are known in advance; (3) drivers have full knowledge of and range of vehicles. We briefly present how these factors affect
location of fueling stations along their path and refuel as needed the FRLP through a simple example using the network in Fig. 1.
to successfully complete their round trips; (4) only nodes of the For example, when the range of vehicles is less than 60 units, driv-
network are considered as possible locations of refueling stations; ers have no chance of completing their round trip even when sta-
(5) vehicles have similar driving ranges; (6) fuel consumption is di- tions are built at all the nodes. When the range is 60 units, AFSs
rectly proportional to distance traveled; and (7) refueling stations must be built at all nodes (i.e. z1, z2, z3, z4). When the range is equal
are uncapacitated. to 80 units, a set of three stations (i.e. z1, z3, z4 or z2, z3, z4) would be
These seven assumptions are not as limiting as they first appear. enough to refuel this round trip. In this specific instance, when a
First, existing FILP/FRLP formulations and the formulation in this solution with z1 is selected, vehicles will start with a full tank from
paper can be easily extended to the case with multiple routes. the origin (z1). If a solution with z2 but without z1 is selected, then
Second, when OD trip matrix is not available, it can be estimated the vehicle returning from the destination refuels at z2 and reaches
from arc flow information (Cascetta and Nguyen, 1988) or gravity the origin by driving 40 units and will have enough fuel to travel 40
model (Kuby et al., 2009). Third, early adopters tend to be aware units during the next trip to reach z2 for refueling. When the range
of the scarcity of AFSs and highly likely to learn the location of is 260 units or greater, a single refueling station located at any
refueling stations (e.g. several web sites provide location of AFSs node is enough to complete the round trip between z1 and z4,
in most areas, e.g. http://www.cleancarmaps.com and http:// which effectively turns the constraint for this path into a flow-
www.afdc.energy.gov). Fourth, while nodes were shown to be a fi- intercepting constraint.
nite dominating set for the FILP (Berman et al., 1995; i.e. the opti- X
mal location of facilities will be subset of nodes of the network), AC—PC Max fq yq ð1Þ
q2Q
Kuby and Lim (2005) showed that the same is not true for the FRLP. X
However, the same authors later showed that facilities along arcs s:t: zi P y q ; 8q 2 Q ; aj;k 2 Aq ð2Þ
q
tend to be beneficial only if the range of vehicles is short compared i2K
j;k

to the length of arcs on a network, and consequently locating on X


zi ¼ p ð3Þ
arcs will not have a significant effect on real transportation net- i
works except in remote areas (Kuby and Lim, 2007). Fifth, the
yq ; zi 2 f0; 1g; 8q 2 Q; i 2 N ð4Þ
new model presented below is flexible and efficient enough to han-
dle multiple vehicle types with different ranges. Sixth, the same is The objective of the AC–PC FRLM is to maximize the round-trip
true for handling variation in fuel consumption based on different traffic volume served. The key innovation of this new formulation
driving conditions, terrain, etc. in different directions. Seventh, de- is constraints (2), which allow the FRLP to be formulated without
spite the absence of capacity restrictions, the new model is still use of facility combinations. Constraints (2) make sure that a flow
useful for locating initial AFSs for several reasons. The simpler is considered to be refueled only if each directional arc on a path q
uncapacitated formulation will provide insights and uncover is travelable after refueling at one of the open stations. This is en-
important structural properties of the problem. Also, in the early sured by writing a separate instance of Constraint (2) for all direc-
years of AFV adoption, deployed facilities will probably not be used tional arcs on each path q. In other words, if every directional arc
at full capacity. Finally, the solution to the uncapacitated problem along the path is traversable after refueling at one of the built facil-
can be used as an initial solution for the capacitated problem. For ities, then the full round trip is refuelable. The set K qj;k is the set of
instance, the results can be considered as prioritized locations for candidate nodes i that make it possible to drive across the entire
refueling stations and actual capacity at these locations can be distance from node j to k if a driver completely refills their tank
determined using a post-processing algorithm. with range R at i. These ‘‘cover sets’’ are easily generated. For exam-
Our model is consistent with the starting tank level assumption ple, in Fig. 1, all nodes (i.e. z1, z2, z3, z4) are considered as candidate
of the original FRLM, although we implement it differently here. It sites and the trip will be refuelable when drivers are able to travel
is consistent in the sense that for an OD pair to be served, stations
must be placed on the path in such a way that a round trip can be
completed repeatedly. In the original FRLM (Kuby and Lim, 2005), Destination
this idea was implemented by assuming that vehicles start at the 60
Origin
origin with a half tank, based on the rationale that if a vehicle could a43
reach the first station down the path starting with a half tank, it a21 30 a34 z4
40 a32
could fill up at that same station on the way back and return to
the origin with a half tank, and be able to repeat the same trip z1 a23
a12 z3
(or any other similarly feasible trip) after that. In contrast, our for- z2
mulation presented here determines the starting fuel level based
on the location of AFSs. If there is an existing AFS at the origin Fig. 1. An example network with a single OD pair.
I. Capar et al. / European Journal of Operational Research 227 (2013) 142–151 145

through all arcs (i.e. a12, a23, a34, a43, a32, and a21). When the range Once the number of stations is determined, the next issue for the
is 90 units, a driver can travel all the way across a12 if it refuels at infrastructure builders to answer is whether they should locate
either z1 or z2 (or both [z1 + z2 P y]). While z1 allows refueling at clusters of facilities serving independent regions or connect these re-
the beginning of a trip, having z2 open allows the driver to refuel gions by network of facilities. It is commonly expected that AFVs
while returning from the destination and be able to reach z2 on will be mainly used for short-distance trips during early stages of
the next round trip without running out of fuel. Similarly, one their adoption (Melendez and Milbrandt, 2006b). As a result, it
can show that only refueling at z4 allows traveling through looks like a reasonable strategy for an infrastructure builder to ini-
a43 [z4 P y]. Constraint (3) makes sure that only p facilities are tially focus on building fuel stations that mainly service travel with-
opened. The last set of constraints defines binary variables. in a metropolitan conurbation. For example, Coulomb Technologies
As mentioned earlier, the AC–PC model is significantly different received stimulus funding to deploy EV charging stations in metro-
from previous FRLP formulations. First, unlike Kuby and Lim’s politan regions such as Austin, TX, Detroit, MI, Los Angeles, CA, New
(2005) model, there is no computationally intensive pre-processing York, NY, and Orlando, FL. On the other hand, the state of Texas
stage, which was proven to grow exponentially as the number of established the ‘‘Texas Clean Transportation Triangle’’ to build a
nodes increases along a path (Capar and Kuby, 2012). Second, while natural gas vehicle corridor among Dallas, Houston, and San Anto-
Capar and Kuby’s (2012) model similarly does not require enumer- nio (http://etuo.uh.edu/ngva), and several EU countries are propos-
ation of facility combinations that can cover each path, their model ing a GasHighway network of CNG stations from Scandinavia to
focuses on covering the nodes of each path, whereas the AC–PC Italy (http://web.etaflorence.it/uploads/media/OE5.5_paper.pdf).
model focuses on the arcs. As a result of checking whether all nodes Hence, using the AC–PC model, we will investigate whether infra-
are covered on each path instead of all arcs, Capar and Kuby’s structure builder should initially consider deploying AFSs as inde-
(2012) node-cover model adds four variables and up to four con- pendent cluster of facilities serving a small region (e.g. a city) or
straints for each node on each path to determine whether that path should they connect with other cities to serve larger regions.
is fully refuelable, compared with at most one variable (added only One of the difficult issues facing infrastructure developers is
when this new node was not part of any other path) and two con- uncertainty in demand; not only are long-distance OD flow matri-
straints for the AC–PC model. Consequently, the new AC–PC creates ces not always available, but drivers in different zones are not all
a much more compact model, which can be solved in shorter time equally likely to adopt AFVs. Consequently, this creates uncertainty
when compared with both previous formulations. about the quantity and locations of AFSs. Kim (2010) developed a
spatial decision support system for the FRLM that allows users to
weight OD trip volumes according to the socio-economic charac-
4. Strategic questions teristics of the origin zones. It is crucial to determine the sensitivity
of locations to changes in the flow matrix.
In addition to proposing a more efficient and compact formula- Another question facing decision-makers is whether it is worth-
tion of the FRLP, another objective of this paper is to use the AC–PC while to build stations at or near busy intersections or downtown
model and introduce some extensions of it to provide managerial areas where real estate prices may be higher. Are the best locations
insights to several key questions for deploying AFS infrastructure. so much better than the lesser locations that they remain worth
After analyzing the current infrastructure challenges for AFVs, we building even when their higher land acquisition costs are taken
identified four questions as high priority strategic issues. In addi- into account? Or are there major tradeoff gains to be had by trad-
tion, we used vehicle range as a sensitivity parameter and evalu- ing off one or more good locations for the chance to spread that
ated its impact on key questions when appropriate. cost over a larger number of stations at sites that are not quite as
good?
(1) What is the minimum number of stations that can refuel a
certain percentage of traffic flow? 5. Model extensions
(2) Should infrastructure deployment projects focus on locating
clusters of facilities serving independent regions or connect- To answer the strategic questions discussed in Section 4, the fol-
ing these regions by network of facilities? lowing extensions of the AC–PC model are introduced. In addition,
(3) What are the impacts of the demand forecast on the location for some experiments, real-world and random network data are
of fuel stations? further processed to make the analysis possible.
(4) What is the effect of variations in costs of land given an The minimum numbers of AFSs required to service specific per-
investment budget constraint? centages of flow are determined using a set covering (SC) version of
the AC–PC model (SC–AC–PC). The SC–AC–PC model is created by
A large number of fuel stations may be needed if the goal is to re- switching the objective of the AC–PC model with the Constraint
fuel all trips on a road network. However, it is impractical to launch (3) and modifying them accordingly:
the infrastructure deployment projects by building all the required X
stations at once because the return on investment may not be SC—AC—PC Min zi ð5Þ
enough to justify such a decision. Although it is important to know, i

private and public organizations may not always have a clear idea of s:t:
how many stations are needed. Instead, they may have an objective X
about a certain percentage or absolute amount of trips or population zi P y q ; 8q 2 Q ; aj;k 2 Aq ð2Þ
to be covered in terms of their targeted market share or policy q
i2K j;k
concerns. For example, the European Union in 2009 set a goal of
10% market share for biofuels, and 20% for all alternative fuels X
fq yq P S ð6Þ
including natural gas, by 2020. The Canadian Province of Ontario q2Q
is aiming for one out of 20 cars to be EVs by 2020 (http://www.auto-
motive-fleet.com/News/Story/2011/03/Ontario-Adds-EV-Charging- yq ; zi 2 f0; 1g; 8q 2 Q ; i 2 N ð4Þ
Stations.aspx). In these and similar cases around the world, these
targets can be translated into a flow coverage objective, which is where S represents the objective percentage of flow refueled. In
defined as the percentage of round trips refueled by AFSs. addition to utilizing the SC–AC–PC model to answer the first
146 I. Capar et al. / European Journal of Operational Research 227 (2013) 142–151

question, the model is also utilized for other experiments to create a determined for all pairs (m  (m  1)/2). Finally, the traffic flow
tradeoff curve by systematically varying the objective flow coverage for a path q is generated utilizing Fotheringham and O’Kelly’s
from 10% to 100% in increments of 10%. (1989) gravity model:
The AC–PC model locates p facilities when there are no existing
AFSs. However, in the real world, infrastructure deployment POq PDq
fq ¼
projects may need to consider pre-existing stations. Hence, a D2q
conditional formulation is utilized to make decisions under such
 
circumstances. We specifically set zi = 1 for those existing facilities,
where POq PDq is randomly generated (uniform distribution) popu-
and adjust the number of desired facilities appropriately consider-
ing the number of existing facilities. lation of origin (destination) node and Dq is the length of the short-
Finally, a budget-constrained version of the FRLM is created by est path between OD pair. Next, random network data sets are
P generated for each combination of n (250, 500, 750) and m (30,
replacing constraint (3) with i ci zi 6 B, where B is the total avail-
able budget and ci is the total cost (i.e. land cost plus the construc- 60) values.
tion cost) of building a station at candidate site i. Once data sets are prepared for experiments, specific problem
instances are generated by changing R and p values. Driving ranges
equal to 60, 100, and 200 miles are used for Florida and Orlando
6. Numerical experiments networks, while 250, 375, and 500 units are used for the randomly
generated ones.
This section on numerical experiments is divided into three To measure the effects of uncertainty in the OD demand fore-
subsections. The first provides the details on the numerical exper- cast, uniformly distributed random demand between [fq  e,
iments, such as data sets, experiment design, and solution ap- fq + e] is explored, where e is the error percentage between 20%
proach. The second demonstrates the computational benefits of and 100% with an increment of 20%. To have statistically significant
the new model over the existing ones. Finally, the third subsection results, 30 problem instances for each [fq  e, fq + e] range is
presents the experimental results, analysis and answers to the generated.
strategic questions posed for the deployment of AFSs. Only Orlando, FL data is used to evaluate the effects of varia-
tions in costs of land under a budget constraint, based on actual
6.1. Data sets and experiment details land value data from Orange County Property Appraiser’s Office
within a 1/4 mile buffer around each node. In addition, a uniform
The numerical experiments are run using two types of transpor- construction cost of $500,000 is used for all stations in addition
tation networks: real-world and random. While the real-world to the land cost.
data sets are used to address the key questions discussed earlier, All problem instances are solved using Xpress-MP Version 7.2
random data sets are used to validate and extend the applicability on a computer with Windows 7 64-Bit OS, IntelÒ Core™ i5 CPU
of these results. The real-world networks for the Florida state high- at 3.33 gigahertz with 6.0 gigabyte of RAM. Xpress-MP was run
way and Orlando metropolitan networks are based on geographic for a maximum of 1 hour for each problem instance.
information system data sets. While the Orlando OD trip matrix
contains intra-city trips ranging from 0.5 to 62 miles (one way), 6.2. Comparison of formulations
the state data set focuses primarily on inter-city travels ranging
from 7 to 781 miles (one way). Shortest paths are determined by The quality of the solutions and running time of the AC–PC for-
minimum travel time based on the posted speed limits of lim- mulation in this paper is numerically compared with the ‘‘Node
ited-access highways and a calibrated 15% time penalty on the Cover–Path Cover’’ (NC–PC) formulation1 of Capar and Kuby
posted speed limit for lower functional classes of roads. One key (2012), that was shown to be able to handle larger-scale problems
difference between the data sets is the level of zonal aggregation as fast as or faster than the proposed heuristics in the literature.
of the origins and destinations. In the Orlando data set, 358 original The version of NC–PC tested in this paper includes improvements
traffic analysis zones (TAZs) from the Florida Department of Trans- suggested in the original paper to improve its performance; specifi-
portation (FDOT) were aggregated to 102 origin and destination cally, a lemma and results of greedy heuristic to prioritize locations
nodes, with more detail in the denser central areas. The Florida and to provide a cutoff value for branch and bound. As summarized
data set uses only 74 origin and destination nodes; most counties in Tables 1 and 2, the numerical experiments show that the new for-
are represented by a single centroid, except for (a) six counties in mulation takes less CPU time to solve problems to optimality and
the Miami, Tampa–St. Petersburg and Orlando areas that were sub- improves the best results obtained for problems not solved to opti-
divided into 2–3 nodes each and (b) several sparsely populated mality. For example, the new model reduced the average solution
counties that were combined into one. In both data sets, short in- time by over 74% and 99% for real-world and random networks,
tra-zonal flows are excluded. Another difference is that Orlando’s respectively. In addition, the new formulation outperformed Capar
trip volumes were based on FDOT data, while Florida’s inter-city and Kuby’s (2012) formulation on four out of five problem instances
volumes were based on a spatial interaction model. Interested that were not solved to optimality for Orlando network, whereas
readers are referred to Kuby et al. (2009) for details of data gener- only in one problem instance was it outperformed. One advantage
ation/collection. of Capar and Kuby’s (2012) formulation is that it provides slightly
To generate the random data sets, the network size (n) is first tighter bounds for problems not solved to optimality, even when
determined; then n points in [0, 1000]2 according to a continuous their best obtained solution performs poorly compared to results
uniform distribution are randomly selected. Next, after creating a from the AC–PC formulation. The reason for the slightly tighter
full undirected graph over these n nodes with the length of an edge bound is due to the implemented lemma in the experiments for this
being the Euclidean distance between two nodes, the minimum paper.
spanning tree is constructed using Kruskal’s (1956) algorithm.
1
Additional n edges are added to the spanning tree while keeping Capar and Kuby (2012) referred to their formulation as the MBIP (Mixed Binary
Integer Program), to contrast it with the slower greedy and genetic heuristic
the maximum degree of each node at a chosen threshold value of algorithms. Having now developed a superior MBIP here, we retroactively suggest
four. Afterward, m nodes out of n are randomly chosen to be OD Node Cover–Path Cover (NC–PC) as a more descriptive name for Capar and Kuby’s
nodes, and the shortest path (Dijkstra’s 1959 algorithm) is (2012) MBIP formulation.
I. Capar et al. / European Journal of Operational Research 227 (2013) 142–151 147

Table 1 It is important to carefully interpret the above finding because


Performance comparison between the AC–PC and NC–PC: real-world networks. experiments show these results are sensitive to the structure of
AC–PC NC–PC the highway networks and OD zonation scheme. For example,
Florida Orlando Florida Orlando although the Florida statewide dataset covers a very large geo-
graphical area, it requires fewer AFSs to cover a certain percentage
No. of opt. solutions founda 102 97 85 89
Min solution time (seconds) 2 1 7 2
of traffic volume compared to the Orlando dataset (e.g. when
Avg solution time (seconds) 31 362 982 552 R = 200 miles, four AFSs are required to refuel 60% of the traffic vol-
Min gap (%) – 0.11 0.03 0.01 ume for the Florida dataset, versus 12 AFSs for the Orlando data-
Max gap (%) – 0.24 0.41 0.55 set). This implausible observation indicates that dataset creation
Avg gap (%) – 0.17 0.17 0.27
is crucial for actionable analysis. Considering that the absolute
a
102 Problem instances are solved for each network: R = 60, 100, 200 miles with number of p depends on the level of network detail, it is important
p = 1–25 and then p = 30–70 with an increment of 5. to evaluate p relative to a normalized scale. Accordingly, the per-
centage of p (p%) in proportion to the minimum number of stations
that can cover 100% of traffic flow is used as a normalized scale to
6.3. Experimental strategic analysis evaluate the relationship between the percentage of the total flow
refueled and the required number of stations. For example, Fig. 3a
This section presents the experimental results and respective indicates that 80% of the trips in Orlando could be covered by 34%
analysis to answer the strategic questions posed earlier in the paper. of the total number of stations that would be needed to cover 100%
of the trips. Similarly, Fig. 3b depicts the exponential relationship
6.3.1. What is the minimum number of stations that can refuel a for random data sets as less than 19% of the total number of sta-
certain percentage of traffic flow? tions required to refuel 100% of the total flow will be enough to
Experiments with real-world and random transportation net- serve over 60% of the traffic. Therefore, experiment results still sug-
works show that a small number of strategically located stations gest that, within the context of any given network dataset, a small
will be enough to cover a high percentage of traffic flow. Hence, number of strategically located stations will be enough to cover a
adoption of AFVs can be facilitated through deployment of rela- high percentage of traffic flow.
tively small number of AFSs sited at the right locations. For exam- As expected, Fig. 2a also indicates that the higher the ranges of
ple, Fig. 2a indicates that, for the Florida state highway network, vehicles, the fewer AFSs are required to refuel the total potential
only two stations are needed to refuel 30% of the total potential flow. However, interestingly, the range of the vehicles does not sig-
flow for all ranges and four (3) stations are needed to refuel 50% nificantly affect the minimum number of AFSs when objective per-
of the flow when R = 60 miles (R = 100 and 200 miles). Similar cent flow refueled is relatively small (e.g. 660% for the Florida State
trends are also observed for the Orlando network (Fig. 2b) and ran- Highway network). The range of vehicles becomes a significant fac-
dom networks. tor for higher targeted percentage of flow requirements because

Table 2
Performance comparison between AC–PC and NC–PC: random networks.

AC–PC NC–PC
Number of nodes (n) 250 500 750 250 500 750
Number of OD nodes (m) 30 60 30 60 30 60 30 60 30 60 30 60
No. of opt. solutions founda 30 30 30 30 30 30 30 26 30 25 26 24
Min solution time 0.2 0.7 0.3 0.9 0.4 1.4 1.7 4.5 2.0 5.7 2.5 7.0
Avg solution time 0.4 4.4 1.4 4.1 1.7 12.2 10.6 564.7 117.0 746.7 404.3 852.7
Min gap (%) – – – – – – – 1.47 – 0.18 1.27 0.84
Max gap (%) – – – – – – – 3.69 – 3.26 5.48 5.77
Avg gap (%) – – – – – – – 2.33 – 1.36 2.81 3.20
a
30 Problem instances are solved for each network: R = 250, 375, 500 units, with p matching the objective flow coverage from 10% to 100% in increments of 10%.

Fig. 2. Relationship between objective traffic flow and the minimum number of AFSs required.
148 I. Capar et al. / European Journal of Operational Research 227 (2013) 142–151

Fig. 3. Relationship between objective traffic flow and p%.

while the initial stations are located at places where they can re- primarily short-distance intra-city trips are served, which results
fuel high amounts of flow, later stations are added to serve small in a network of infrastructure mainly serving disconnected sub-re-
flow amounts and/or flow requiring multiple stations along their gions (e.g. individual cities such as Miami and Tampa) more heav-
path. For these instances, having a higher-range vehicle reduces ily in the early stages of AFSs deployment. As the range increases to
the number of AFSs by either reducing the number AFSs needed R = 200, a station in downtown Orlando replaces one in the Miami
to travel between a specific OD pair or allowing an AFS to serve area, creating three widely separated metro areas with at least one
additional trips between OD pairs that are not refuelable with a station, but because of the long range, trips can be made between
lower-range vehicle. Note that these observations are not evident them, and nodes up to 100 miles away can make there-and-back
with the Orlando dataset because even 60 miles allows over 99% trips to the stations located in central Orlando and Tampa. The re-
of the trips to be completed with a single tank of fuel. Hence, there sults presented for p = 15 in Fig. 5 shows that the additional 11 sta-
is not much room for improvement. tions allow trips to be made between Orlando and Tampa when
range is 60 miles, but Miami is still disconnected from the other
two regions. But when range is 200 miles, additional fuel stations
6.3.2. Should infrastructure deployment projects focus on locating
are used to make long distance trips possible among all four of
clusters of facilities serving independent regions or connecting these
Florida’s major metropolitan regions, including Jacksonville.
regions by network of facilities?
Hence, focusing on clusters of independent regions may be a viable
Numerical experiments indicate that the choice between
strategy when the vehicle range is considerably less than the aver-
clustering and connecting deployment strategies is affected by
age distance between OD pairs or the number of AFSs to be located
the range of vehicles considered and number of AFS to be located.
Fig. 4 presents optimal stations and covered paths for p = 4 for
inter-city trips in Florida. When the vehicle range is 60 miles,

Fig. 4. Locations of AFSs and paths covered with ranges of 60 miles and 200 miles, Fig. 5. Locations of AFSs and paths covered with ranges of 60 miles and 200 miles,
p = 4. p = 15.
I. Capar et al. / European Journal of Operational Research 227 (2013) 142–151 149

is relatively small. Along the same lines, as the range of vehicles in-
creases, the trip length becomes less important for infrastructure
builders and results favor a network of facilities connecting many
regions to each other.

6.3.3. What are the impacts of the demand forecast on the location of
fuel stations?
Because AFVs are a relatively new phenomenon and future
adoption rates will depend on various uncertain factors including
oil prices, technological improvement, price, and government sub-
sidies, infrastructure companies need to locate initial stations
based on demand forecasts. Hence, it is important to understand
how locations of facilities and consequently the traffic flow refu-
eled will be impacted from OD matrix forecast error.
Fig. 6 shows the impact of locating stations based on the fore- Fig. 7. Impact of the total construction budget on the percentage of flow refueled.
casted flows. The impact is measured by comparing the actual flow
refueled considering location of AFSs based on forecasted and exact
traffic flow information. For example, when infrastructure builder demand uncertainty is more likely to be felt when considering sta-
deploys an initial set of stations to refuel 20% of all traffic based tion capacities, which will become a more important issue as the
on forecasted flows and observes the exact flow after building market grows after the initial roll-out of stations and vehicles.
the stations, the coverage difference will be less than 2% even with
±100% forecast error compared to locating these stations based on 6.3.4. What is the effect of variations in costs of land given an
the exact demand information. Although the gap initially increases investment budget constraint?
and then goes down as the targeted traffic flow increases, it is most Many of the best-known public-sector facility location models—
sensitive to input parameters (i.e. forecast error and vehicle range) such as the p-median, max cover, and p-center models—implicitly
when targeted flow coverage is between 40% and 80%. Moreover, assume that all facilities cost the same to build, whereas many pri-
the maximum gap for all e values were consistently measured at vate-sector models such as fixed-charge models take facility
60% targeted flow coverage and ranged from 2.53% (e = 20%) to investment costs into account explicitly. Early AFS networks, how-
5.22% (e = 100%). The gap rapidly diminishes after 80% targeted ever, are often public–private partnerships or private develop-
flow coverage because even 100% forecast errors would not be en- ments with partial government subsidies. Fuel stations tend to
ough to shift locations as majority of OD pairs will be refueled be placed at or near coveted high-traffic intersections, implying
without any change. The lack of similar behavior for up to 40% tar- that real-estate acquisition costs may be a hindrance to affording
geted flow coverage can be explained using the same reasoning. the optimal set of stations. Analyses of the Orlando dataset with
In summary, forecast error has limited negative effects on the actual land-cost data confirm this intuition. As Fig. 7 shows, as
location of AFSs and amount of flow refueled. Its negative impacts the allocated station-building and land-acquisition budget in-
diminish quickly once 80% or more of the flow is covered. In addi- creases (measured on a per-site basis so that a curve can be made
tion, forecast error does not increase the minimum number of for multiple p values), a higher percentage of flows can be covered
facilities to refuel 100% of the traffic flow in the future. These re- with the same number of stations as budgets are increased. By
sults may be due to the huge number of cells in these OD matrices, making it possible to obtain sites at the busiest, most expensive
as well as the fact that even a doubling or halving of a small cell intersections that are on more shortest-paths, a million dollar per
value will do little to move a station that has been located to serve site budget can add 15% to the flows covered.
the huge flows that exist between nearby large population centers. Table 3 shows that higher budgets do not uniformly lead to
As a result, organizations planning to deploy AFSs but waiting to building at more expensive intersections. The optimal strategy
collect actual demand information could actually start deploying could also be to re-purpose the budget to obtaining a greater num-
these stations as initial AFSs will not be redundant in the future ber of stations. In this experiment assuming a base construction
and actually accelerate the adoption of these vehicles by providing cost of $500K, the optimality of building a sixth station does not
the much needed infrastructure. We speculate that the impact of materialize until the budget reaches $750K per site, or a total of
$4.25 million. With a $5 million budget, the model chooses to build
seven stations, including stations at three nodes (176, 180, and
269) that were also optimal with the smallest budget. This is
why the p = 5 scenario, where the model can choose any five sta-
tions assuming they all cost the same, does better than any of

Table 3
Comparison of AFS locations selected under varying budget constraints.

p = 5 (no $575K $625K $675K $750K $1000K


land cost) per site per site per site per site per site
Location ID
29 176 126 29 66 29
176 180 176 176 126 66
202 198 202 202 176 126
219 219 219 219 202 144
222 269 269 222 219 176
269 180
202
Fig. 6. The relationship between percent flow refueled based on forecasted flows 269
and average gap.
150 I. Capar et al. / European Journal of Operational Research 227 (2013) 142–151

the other budget scenarios where the model cannot afford more formulation for the capacitated FRLM (Upchurch et al., 2009) is
than five stations, but not as well as the two highest budget scenar- an important direction for future research.
ios where six or seven stations can be built. These scenarios indi- Many similar strategic dilemmas await the energy companies
cate that it may be suboptimal for energy companies to assume that are now beginning to plan the station networks that are nec-
that land costs do not need to be taken into account. essary to convince drivers to switch from gasoline-powered to
alternative-fuel vehicles. FRLM-type models featuring path de-
mands and range restrictions may require extensive modification
7. Conclusions to apply to vehicles such as gas-electric hybrids and gas–ethanol
flex-fuel vehicles, or to Levels 1 and 2 charging stations with their
Many studies show that lack of an easily accessible network of long charging times. They are, however, directly applicable to Level
fuel stations is one of the major barriers for large-scale adoption of 3 fast charging, battery switching, and a variety of liquid and gas-
alternative-fuel vehicles. In this study, we introduced a generalized eous alternative fuels. In addition, such models could be applied to
FRLM formulation with more flexibility and applicability to differ- other path-based, range-restricted phenomena, such as crew
ent fuel types and geographic scales. The presented model is more switching. This paper has demonstrated that the arc cover–path
compact and solved the problems 74–99% faster than the most effi- cover formulation of the flow-refueling location model has the
cient FRLM formulation in the literature. Having a compact formu- computational efficiency, flexibility, and applicability to answer
lation that can be solved faster will allow involved parties to work many additional strategic questions for a wide variety of fuel types,
with more realistic problem sizes for infrastructure deployment. station types, and geographic regions.
Next, using the presented formulation, we investigated a set of
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