Computers and Operations Research 129 (2021) 105222

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Computers and Operations Research

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

Equitable routing of rail hazardous materials shipments using CVaR

methodology
S. Davod Hosseini, Manish Verma ⇑
DeGroote School of Business, McMaster University, Hamilton, Canada

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

Article history: The low probability – high consequence nature of hazardous materials (hazmat) incidents dictate a risk-
Received 16 December 2019 averse route planning approach. However, preparing routing plans for multiple hazmat shipments
Revised 28 November 2020 between various origin–destination pairs also raises the question of risk-equity, and not just minimiza-
Accepted 7 January 2021
tion of hazmat risk. Hence, the objective is to plan an equitable routing plan for different rail hazmat ship-
Available online 12 January 2021
ments while not only ensuring the safety of citizens but also precluding certain population zones from
being subjected to intolerable levels of hazmat risk. To this end, we propose an analytical framework that
Keywords:
makes use of a conditional value-at-risk (CVaR) measure of risk to generate minimum risk shipment
Risk equity
Conditional value-at-risk
routes while promoting risk-equity in both the arcs and the yards of the railroad network. While the com-
Railroad transportation mercial solver, CPLEX, lacks the ability to generate integer solutions for even small problem instances, a
Hazardous materials Lagrangian relaxation method aimed at being maximized using the Subgradient optimization algorithm
Integer optimization is applied to provide a lower bound. The proposed framework is finally used to study several problem
instances using the realistic infrastructure of a railroad operator, and to conclude that risk-equity can
be achieved by re-routing, and that the design of train services along with the trade-off between yard-
risk and arc-risk determine the number of re-routing and the optimal value of CVaR.
Ó 2021 Elsevier Ltd. All rights reserved.

1. Introduction nately, the possibility of spectacular events resulting from multi-

A significant portion of the materials that are essential to indus-
trial lifestyle are also harmful to humans and the environment. In
general, the points of production and consumption of these haz-
ardous materials (hazmat) are different, and hence they are trans-
ported in significant volumes. In North America, railroad is the
primary mode for moving (non-bulk) hazmat shipments. For
example, in 2012, railroad carried around 111 million tons of haz-
mat in the United States (U.S. Department of Transportation, 2015),
whereas the number for Canada was 48.38 million tons in 2014
(Transport Canada, 2016). It is important to mention that the quan-
tity of hazmat traffic on railroad networks is going to continue
increasing because of two reasons: first, the higher utilization of
intermodal transportation to move chemicals (Verma et al.,
2012); and second, the most recent need to move a larger number
of crude oil shipments from the Bakken shale formation region in
the United States and Canada to the refineries along the southern
and eastern coast of the continent (AAR, 2014; CAPP, 2014). Rail-
road is one of the safest modes for transporting hazmat, unfortu-
⇑ Corresponding author.
E-mail address: mverma@mcmaster.ca (M. Verma).
railcar incidents do exist (Vaezi and Verma, 2017, 2018). The
derailment and explosion of several crude oil rail tank cars causing
irreparable destruction and loss of human life in Lac-Megantic
(Quebec, Canada), in July 2013, is an example of the possible catas-
trophe associated with rail hazmat shipments.
It is important to note that, since the 1970s, the railroad industry
has devoted significant resources towards reducing the frequency of
tank car accidents as well as the likelihood of releases in the event of
an accident. The more recent initiatives have focused on analyzing
past accident data in an effort to increase railroad safety by improv-
ing rail-tracks or railcar tank designs; and, on the development of
risk assessment methodologies that incorporate the specific nature
of rail shipments. However, most of the risk assessment methodolo-
gies for hazmat shipments were developed in the highway domain,
and given the low probability-high consequence nature of rail hazmat
shipments, their efficacy is rather limited. For example, the most
popular measure of hazmat risk viz., expected consequence is risk
neutral, and hence unable to develop risk-averse routes that would
prevent high consequence events. In addition, all the risk assessment
measures developed within the railroad domain yield a single route
between a given origin–destination pair, which is not suitable from
the perspective of a regulator interested in not overloading any seg-
ment or part of the network. Thus, there was a need to develop risk

https://doi.org/10.1016/j.cor.2021.105222
0305-0548/Ó 2021 Elsevier Ltd. All rights reserved.
S. Davod Hosseini and M. Verma
assessment methodologies that would both ensure risk-averse rout-
ing, and incorporate the risk tolerance of a decision maker to gener-
ate multiple routes between a given origin–destination pair. To close
this gap, Hosseini and Verma (2017) made the first attempt to
develop a value-at-risk (VaR) assessment methodology to facilitate
risk-averse routing of rail hazmat shipments. It is pertinent that
though VaR has a simple interpretation for hazmat shipments, viz.,
how many people are exposed to hazmat risk given a certain confi-
dence level, it is critiqued for ignoring the tail of the distribution,
i.e., overlooks catastrophic events. To overcome the indicated short-
comings, Hosseini and Verma (2018) subsequently developed a con-
ditional value-at-risk (CVaR) measure that quantifies the risk that
would be encountered in the unfavorable tail of the distribution to
avoid extreme events. Through numerical experiments, they
demonstrate that the latter methodology not only incorporates the
characteristics of railroad accidents and the risk tolerance of the
decision maker to generate risk-averse routing of shipments
between a single pair of origin–destination yards, but also under-
scores its superiority over both the expected consequence and the
VaR measures.
In the current paper, we study the routing of multiple rail haz-
mat shipments of different volumes between multiple pairs of ori-
gin–destination yards, i.e., a multi-commodity flow problem. It is
important that the ensuing routing plan could result in the over-
loading of certain rail-tracks and/or railyards, which in turn will
increase the corresponding hazmat risk. Thus, to prevent certain
populated zones from being subjected to intolerable hazmat risk,
we promote equity in the spatial distribution of hazmat risk
throughout the railroad network. Hence, the proposed analytical
methodology incorporates physical infrastructure of railroad trans-
portation system that entails using a limited number of train ser-
vices to move shipments and undergoing transfer operations at
intermediate yards, and then generates minimum CVaR risk routes
for rail hazmat shipments while ensuring equitable distribution of
hazmat risk in the given railroad network. Finally, the proposed
methodology was used to study and analyze several problem
instances generated using the realistic infrastructure of a railroad
operator, and to gain insights. Through numerical experiments
we illustrate the importance of train service design in ensuring risk
equity; demonstrate the impact of risk-equity constraints on opti-
mal CVaR values, on optimal routing of hazmat shipments, and the
trade-off between yard-risk and arc-risk; and, make use of Lagran-
gian lower bound to validate the high-quality solutions resulting
from the proposed methodology.
The rest of the paper is organized as follows. Section 2 reviews
the relevant literature, followed by the problem description and
assumptions in Section 3. The proposed analytical methodology,
i.e., mathematical program and the solution technique, is devel-
oped in Section 4. Solution and analyses of the realistic size case
study are discussed in Section 5. Finally, conclusions, contributions
and directions for future research are outlined in Section 6.
2. Literature review
For expositional reasons and also to position this work in the
context of the existing literature, the relevant literature is orga-
nized under three themes: first, risk assessment and management
initiatives for rail hazmat shipments; second, peer reviewed
engagements dealing with catastrophic avoidance (i.e., high conse-
quence); and third, consideration of risk equity in hazmat
transportation.
2.1. Risk assessment and management of rail hazmat shipments
Risk assessment: Risk is most commonly defined as the product
of the probability and the consequence of an undesirable event, and
2
Computers and Operations Research 129 (2021) 105222
is referred to as traditional risk. This expected consequence
approach, originally developed to evaluate risk from highway ship-
ments and from fixed facilities, has been appropriately adapted to
study rail hazmat shipments in Bubbico et al. (2004a), Bubbico
et al. (2004b), Verma (2011), Bagheri et al. (2014), and Cheng
et al. (2017). Lack of data and/or limitations associated with the
expected consequence approach has led to the development of
alternative risk measures such as incident probability that neglects
the incident consequences (Abkowitz et al., 1992), and population
exposure that focuses only on the consequences (ReVelle et al.,
1991; Verma and Verter, 2007). Most recently, Hosseini and
Verma (2017), Hosseini and Verma (2018) have proposed risk
assessment methodologies that make use of value-at-risk and
conditional-value-at-risk measures to incorporate the catastrophic
nature of rail hazmat shipments.
Risk management: As indicated earlier, over the past four dec-
ades, the railroad industry has spent considerable effort in reduc-
ing the frequency of tank car accidents as well as the likelihood
of releases in case of an accident. However, the more recent risk
management initiatives have focused on tank-car design to mini-
mize the likelihood of hazmat release (Barkan, 2008); strategic
placement to reduce the derailment probability of hazmat railcars
(Thompson, 1992; Verma, 2011; Cheng et al., 2017); routing of rail-
cars (Glickman, 1983; Glickman et al., 2007; Verma, 2009; Verma
et al., 2011) and, incorporating the risk preference of the decision
makers to generate dissimilar routes (Hosseini and Verma, 2017,
2018).
2.2. Catastrophic avoidance in hazmat transportation
The expected consequence approach is risk-neutral and thus
unable to capture the public posture against hazmat shipments.
Abkowitz et al. (1992) made the first effort to overcome this limi-
tation by proposing a perceived risk model for highway hazmat
shipments, where risk-averseness was incorporated via a percep-
tion factor. However, the value of the perception factor is difficult
to both understand and quantify, which motivated Erkut and
Ingolfsson (2000) to analyze three catastrophic avoidance models
for highway shipments -i.e., maximum risk (MM); mean–variance
(MV); and, disutility (DU). More recently, there have been efforts to
generate dissimilar routes based on the risk preference of the deci-
sion maker. To that end, Kang et al. (2014a), Kang et al. (2014b)
proposed value-at-risk model for highway shipments, while
Hosseini and Verma (2017) proposed an equivalent methodology
for rail hazmat shipments. Finally, to overcome the limitations
associated with value-at-risk approach, conditional value-at-risk
(CVaR) measures were developed for highway hazmat shipments
(Toumazis and Kwon, 2013, 2016; Faghih-Roohi et al., 2016), and
for rail hazmat shipments (Hosseini and Verma, 2018).
2.3. Risk equity in hazmat transportation
To the best of our knowledge, Fang et al. (2017) made the only
attempt to capture risk-equity on a specific rail service leg, which
was accomplished by altering the train speed when routing and
scheduling rail hazmat shipments. However, most of the risk-
equity work has been done in the highway domain. Risk equity
has been defined as the largest difference in the risk level among
a set of individuals (Keeney, 1980). Gopalan et al. (1990) made
the first effort to generate an equitable set of routes for road haz-
mat shipments such that the difference in hazmat risk in various
zones is less than the threshold. Current and Ratick (1995) pro-
posed a multi-objective model that makes both facility-siting and
hazmat routing decision, and impose risk equity by minimizing
the maximum allowable risk exposure for each zone. Subse-
quently, Carotenuto et al. (2007) proposed a model that generates
S. Davod Hosseini and M. Verma Computers and Operations Research 129 (2021) 105222

minimal risk paths for road hazmat shipments, and limits the risk Y : Set of yards in the network; indexed by i; j; k
on each link as a mechanism to enforce risk equity. Bianco et al. A : Set of ðundirectedÞ arcs in the network; indexed by ði; jÞ
(2009) proposed a bi-level network design model to capture the and ðk; jÞ
interaction between the local regulator seeking to minimize haz- S : Set of train services in the network; indexed
mat risk over its jurisdiction and the regional regulator aiming to by s ðand=or s0 Þ
minimize total transport risk while assuring risk-equity. Kang Ys 2 Y : Set of yards in trainservice fsg; indexed by is ; js ; ks
et al. (2014b) used a value-at-risk approach to model equitable As 2 A : Set of ðdirectedÞ service legs in trainservice fsg;
routing of road hazmat shipments, and proposed a relaxation indexed by ðis ; js Þ and ðks ; js Þ
heuristic to generate an efficient solution. Romero et al. (2016) V : Set of shipments in the network; indexed by v
developed a model to analyze the facility location and routing N ðv Þ : Number of hazmat railcars in shipment v
problem for hazmat, where the objective is to minimize total Oðv Þ : Origin of shipment v
canister-miles and transportation accident risk. The possibility of Dðv Þ : Destination of shipment v
considering equity in the sites selected and transportation routes
recommended is also included. Equity is expressed in terms of The above notations are then used to define the following
the Gini coefficient and the population is represented as the house- binary decision variables for routing the shipments through the
holds within a certain distance of the transportation facilities railroad network using the available train services:
selected. More recently, Taslimi et al. (2017) proposed a bi-level 8
model where the hazmat carriers select minimum-cost routes in < 1; if shipment v is carried using arc ði; jÞ
>
the network, while the regulatory authority at the upper level xvis js ¼ of train service fsg ðservice leg ðis ; js ÞÞ
>
:
seeks to consider risk-equity by minimizing the maximum trans- 0; otherwise
port risk in a zone. The interaction between the two levels is
achieved through finding the best locations for hazmat response 8 0
teams and making additional road segments available. < 1; if k is a transferring yard between train services fs g
>
xvks0 ks ¼ and fsg for shipment v
To sum, to the best of our knowledge, there is an absence of >
:
risk-averse methodology for equitable routing of rail hazmat ship- 0; otherwise
ments. Considering the demonstrated advantages of the condi-
tional value-at-risk methodology over other catastrophic Next, we can build the routing constraints ðX 2 wÞ based on the
avoidance techniques, we make the first attempt in that direction. decision variables as follows:
It is important to mention that the proposed analytical approach is X X
xvis js  xvjs is
distinct from anything present in the literature in the following js js
ways: first, characteristics of railroad accidents -i.e., sequence of 8
> 1; if is ¼ Oðv Þ
events resulting in release from railcar, derailment and conditional >
>
>
>
probabilities of release; and the possibility of multiple sources of < 0; if is –Oðv Þ or Dðv Þ
¼ 8v ; 8is
release, need to be incorporated; second, unlike highway ship- >
>
> ð for any non  transferring yard is for shipment v Þ
ments, one has to work with pre-defined trains services to move >
>
:
shipments, which may involve transfer operations at intermediate 1; if is ¼ Dðv Þ
rail yards; third, risk equity is ensured across the entire railroad
network, i.e., along each rail-track and in each rail-yard. X X
xvks js  xvjs0 ks0 ¼ 0;
js js0
3. Problem description
for any transferring yard ks0 s for shipment v 8v ; 8ks0 s
In an effort to formulate the optimization program, we first Shipment v traverses through route Oðv Þ  Dðv Þ using S out of
introduce the appropriate concepts and notations pertinent to rail- S available train services in the network, which consists of a set of
S
road transportation system in Section 3.1, which is followed by a transferring yards Yv ¼ s2S Ys and a set of service legs
S
high-level overview of the CVaR methodology proposed in A ¼ s2S As , i.e. totally nv ¼ jYv [ Av j items. It is pertinent to
v
Hosseini and Verma (2018), and the discussion about incorporating note that the routing constraints possess a multi-commodity flow
risk equity, respectively, in the next two subsections. structure. We define the following parameters for the route
Oðv Þ  Dðv Þ of shipment v :
3.1. Railroad transportation system
pvk : Incident probability at transferring yard k resulting from
In a railroad transportation system, the physical infrastructure
transporting Nðv Þ hazmat railcars
comprises of rail yards and tracks. Any two yards are connected
cvk : Consequence at transferring yard k resulting from transport-
by tracks, which are called the service legs of a train traveling non-
ing Nðv Þ hazmat railcars
stop between them. A sequence of service legs and intermediate
pvij : Incident probability in arc ði; jÞ resulting from transporting
yards constitutes an itinerary available to a railcar for its journey.
We focus on the tactical planning problem of a railroad company Nðv Þ hazmat railcars
that regularly transports regular and hazmat freight between dif- cvij : Consequence in arc ði; jÞ resulting from transporting Nðv Þ
ferent pairs of origin–destination yards and needs to ensure that hazmat railcars
demand is satisfied. Hence, the objective is to route rail hazmat ship-
ments using a conditional value-at-risk methodology such that haz- To capture the characteristics of railroad accidents, incident
mat risk is not only minimized but also equitably distributed in the probability in the yards and arcs should take into consideration
railroad network. the probability that a train meets with an accident and the condi-
Sets, indices and parameters tional probabilities that a hazmat railcar derails and releases its
contents. We make use of a decile-based approach to compute
Network G ¼ ðY; A; SÞ these probabilities (i.e., the length of a train is divided into ten
equal parts):
3
S. Davod Hosseini and M. Verma Computers and Operations Research 129 (2021) 105222

  X 10
       17:13  106 for transferring yards. We then use average values
pvij ¼ P Aij  yvr  P Dr jAij  P HjDr ; Aij  P RjH; Dr ; Aij
of conditional probabilities across the ten deciles, hence pvk and
r¼1
pvij do not depend on the train configuration any more, although
they are still dependent upon the number of hazmat railcars
X
10
pvk ¼ PðAk Þ  yvr  ðPðDr jAk Þ  PðHjDr ; Ak Þ  PðRjH; Dr ; Ak ÞÞ Nðv Þ: pvij ¼ arc ði; jÞ0 s length ðmileÞ  7:35  1011  N ðv Þ and
r¼1
pvk ¼ 6:42  1010  N ðv Þ. On the other hand, given a hazmat inci-
  dent, ArcGIS (ESRI, 2007) was used to estimate consequences cv k
where P Aij (or PðAk Þ) is the probability that a train meets with an
  and cvij as the population exposure due to the release from Nðv Þ
accident on arc ði; jÞ (or at yard k); P Dr jAij (or PðDr jAk Þ) is the prob-
hazmat railcars traversing transferring yard k and arc ði; jÞ, respec-
ability of derailment of a railcar in the rth decile of the train given
  tively. Readers are encouraged to refer to Hosseini and Verma
the accident on arc ði; jÞ (or at yard k); P HjDr ; Aij (or PðHjDr ; Ak Þ) (2017) for complete details. It should be evident that both the inci-
is the probability that a hazmat railcar derailed in the r th decile of dent probability and the consequence will increase with the total
the train given the accident on arc ði; jÞ (or at yard k); number of hazmat railcars.
 
P RjH; Dr ; Aij (or PðRjH; Dr ; Ak Þ) is the probability of release from a
hazmat railcar derailed in the rth decile of the train given the acci- 3.2. CVaR for rail hazmat shipments
dent on arc ði; jÞ (or at yard k). Therefore, pvk and pvij depend on yvr ,
the numbers of hazmat railcars in shipment v placed at decile r of Let C vðtÞ denote the tth smallest value in the set
each train (i.e., train configuration), which in total equal Nðv Þ: n o
P10 v cvk [ cvij : k 2 Yv &ði; jÞ 2 Av , PvðtÞ be the corresponding incident
r¼1 yr ¼ N ðv Þ; where yr  8v .
v train length

probability, and Rv be the discrete random variable denoting the

10
It is well known that freight trains can vary in length, and hence
it was suggested by Bagheri (2009) that it be categorized into three risk associated with routeOðv Þ  Dðv Þ. Then Rv can take the follow-
groups: short can carry up to 40 railcars; medium can carry ing values:
8 v Pv
between 41 and 120 railcars, and, anything higher would be long. >
> C ð0Þ ¼ 0; with probability Pvð0Þ ¼ 1  ni¼1 PvðiÞ
Following several numerical experiments, Hosseini and Verma >
>
>
(2018) concluded that long trains would yield a lower optimal
>
>
> C vð1Þ ; with probability Pvð1Þ
>
>
>
> ..
CVaR and thus are more suited for hazmat shipments compared <
.
to the other two train lengths. Hence, we assume that only long Rv ¼
trains are being employed for moving hazmat shipments and
>
>
> C vðtÞ ; with probability PvðtÞ
>
>
reproduce the following estimates in Tables 1 and 2, which were >
> ..
>
>
>
> .
calculated by studying a comprehensive dataset of railroad acci- >
:
dents provided by United States Federal Railroad Administration C vðnv Þ ; with probability Pvðnv Þ
(FRA):
As presented in Verma (2011), we have also assumed an aver- where C vð0Þ < C vð1Þ < C vð2Þ <    < C vðnv Þ and t 2 f0; 1; 2;    ; nv g. It has
been shown in Hosseini and Verma (2017) that for a specific confi-
age train accident rate of 1:48  106 per mile for arcs, and
dence level a 2 ð0; 1Þ, VaR is the minimal threshold level b such that
the hazmat risk Rv does not exceed b with the least probability of
 
Table 1 a: VaRa ðv Þ ¼ min b j PrðRv 6 bÞ P a ¼ minfb j F Rv ðbÞ P ag. Fur-
Conditional derailment probabilities for rail-arcs. Source: Verma (2011)
thermore, Hosseini and Verma (2018) demonstrated that since haz-
Decile Conditional probabilities for arcs mat risk distribution function is discontinuous and hence CVaR,
PðDr jAij Þ PðHjDr ; Aij Þ P ðRjH; Dr ; Aij Þ unlike in the portfolio management domain, cannot be interpreted
simply as the average of the consequences greater than or equal to
1st 0.2012 0.0216 0.0060
2nd 0.1088 0.0413 0.0163
VaR. It has a subtler delineation: CVaR is the weighted average of
3rd 0.0983 0.0685 0.0037 VaR and the hazmat risk greater than that:
     
CVaRa ðv Þ ¼ kva VaRa ðv Þ þ 1  kva E Rv  Rv VaRa ðv Þ
4th 0.1029 0.0614 0.0259
5th 0.0831 0.0525 0.0150
6th 0.0818 0.0588 0.0201
7th 0.0831 0.0318 0.0040 where kva indicates the probability allocated to the risk amount
8th 0.0765 0.0432 0.0021 VaRa ðv Þ by the a-tail distribution of Rv as follows:
9th 0.0831 0.0410 0.0055
F Rv ðVaRa ðv ÞÞ  a
kva ¼
10th 0.0811 0.0531 0.0024
1a
where always F Rv ðVaRa ðv ÞÞ P a by the definition of VaR.
Table 2
Considering confidence level a 2 ð0; 1Þ, we define T be equal to
Conditional derailment probabilities for transferring yards. Source: Verma (2011)
0 if 0 < a  Pvð0Þ , otherwise it is the unique index such that
Decile Conditional probabilities for transferring yards PT1 v PT v
t¼0 P ðt Þ < a  t¼0 P ðt Þ . The a-VaR of the risk along route
PðDr jAk Þ PðHjDr ; Ak Þ P ðRjH; Dr ; Ak Þ
Oðv Þ  Dðv Þ is then VaRa ðv Þ ¼ C vðTÞ , and the a-CVaR of the risk asso-
1st 0.2081 0.0347 0.0072
ciated with the route is
2nd 0.0905 0.0922 0.0023
" #
3rd 0.1086 0.1146 0.0083
1 nv
X 
v
4th 0.1086 0.0243 0.0021 CVaRa ðv Þ ¼ C ðTÞ þ P ðtÞ C vðtÞ  C vðTÞ
v
ð1Þ
5th 0.0950 0.0224 0.0020 1a t¼Tþ1
6th 0.0724 0.0547 0.0020
7th 0.1041 0.0662 0.0071 For brevity and for expositional reasons we do not reproduce
8th 0.0814 0.0374 0.0019 the complete details to calculate VaR and CVaR here and invite
9th 0.0543 0.1207 0.0179
the reader to refer to Hosseini and Verma (2017) and Hosseini
10th 0.0769 0.0611 0.0023
and Verma (2018), respectively. However, for the problem of inter-
4
S. Davod Hosseini and M. Verma Computers and Operations Research 129 (2021) 105222

est, the objective at the given confidence level a is Pk C k  d k 8 k ð5Þ

P
min v CVaRa ðv Þ, which implies routing rail hazmat shipments
using the available trains services in the network such that the Pij Cij  dij 8ði; jÞ ð6Þ
total resulting hazmat risk as measured by CVaR is minimized.
X2w ð7Þ
3.3. Risk equity for rail hazmat shipments
The objective function of (P) seeks to find the minimum CVaR
routes for all the shipments. Constraint sets (5) and (6) impose
Note that each yard in the railroad network might be used to
the threshold hazmat risk on transferring yards and rail-arcs,
transfer railcars between train services for hazmat shipments,
respectively. Finally, constraint set (7) contains the routing con-
and that each (undirected) arc might be utilized by one or more
straints. It is evident that each shipment has alternative routes
train services to carry hazmat shipments. Hence, we impose
available in the network, hence our objective is to determine the
threshold restrictions on both yards and arcs of the network so that
route Oðv Þ  Dðv Þ which has the minimum CVaR. To do that, we
equitable distribution of risk across the network is guaranteed. To
extend (1) as follows
define the equity constraints, we first need to calculate the total
hazmat volume transferred at each transferring yard k and also CVaRra ðv Þ ¼ C vðrÞ
the total hazmat volume carried via arc ði; jÞ of the network, which 0 1
are gained as follows 1 BX X  X X
X þ @ pvk cvk  C vðrÞ xvk 0 ks þ C
A
NðkÞ ¼ Nðv Þxvks0 ks ð2Þ 1  a s;s0 k; cv >C ðvrÞ
s
s ði;jÞ; cvij >C ðvrÞ
k
v ;s0 ;s 
X pvij cvij  C vðrÞ xvis j s
Nði; jÞ ¼ Nðv Þxvis js ð3Þ
v ;s 
where C vðrÞ ; r 2 f0; 1; 2;    ; Mg C vð0Þ ¼ 0 is the rth smallest value in
Then we define the following decision variables for the yards n o
and arcs in the network: the set cvk [ cvij : k 2 Y&ði; jÞ 2 A , and M is the total number of
Pk : Incident probability at transferring yard k resulting from yards and arcs of all train services available in the rail network.
hazmat volume N ðkÞ Therefore, for each shipment the objective is to
Ck : Consequence at transferring yard k resulting from hazmat CVaRa ðv Þ ¼ min CVaRra ðv Þ, and so the objective of problem (P),
r
volume N ðkÞ (4), can be rewritten as
Pij : Incident probability in arc ði; jÞ resulting from hazmat vol-
ume N ði; jÞ X 1
min C vðrÞ þ g r ðv Þ ð8Þ
Cij : Consequence in arc ði; jÞ resulting from hazmat volume r
v 1a
N ði; jÞ
Consequently, we define the equity constraints as Pk Ck  dk for where
each yard k, and Pij Cij  dij for each arc ði; jÞ. These two constraints 0
X X 
will ensure that the expected consequence in each transferring g r ðv Þ ¼ min @ pvk cvk  C ðvrÞ xvks0 ks
X2w
yard and arc of the network resulting from transporting multiple s;s0 k; cv >C vðrÞ
k
rail hazmat shipments will not exceed the threshold values dk 1
and dij , respectively. X X 
C
þ pvij cvij  C vðrÞ xvis js A
s ði;jÞ; cvij >C ðvrÞ
4. Analytical methodology

In this section, we first outline the mathematical model including

4.2. Solution methodology
the assumptions, and then briefly discuss the solution methodology.
Note that the routing constraints have a multi-commodity flow
4.1. Mathematical model
structure, and hence (P) could be deemed as a variant of the multi-
commodity flow problem, and hence NP-hard. Therefore, pure
In developing the mathematical formulation, we make the fol-
exact algorithms, if not running out of memory, can be extremely
lowing assumptions. First, the planning is conducted on a weekly
slow for finding the optimal solutions of real-size problem
basis, and hence the demand is expressed in terms of the number
instances. This motivated the development of a greedy heuristic
of railcars to be shipped per week. Second, all the hazmat being
algorithm that combines tailored Dijkstra’s shortest path algorithm
shipped on a train possess similar chemical properties and the
for CVaR routes, as an exact solution procedure which optimally
undesirable consequences of their interactions can be ignored.
finds the minimal CVaR-risk routes for each hazmat shipment
Third, all the trains used in the train services are long and have
using the available arcs and yards that are not overloaded yet,
enough capacity to carry the hazmat shipments all the way from
and a greedy procedure for prioritizing the hazmat shipments to
their origins to the destinations. Fourth, hazmat shipment cannot
be transported. The quality of the resulting solutions was then
be split and have to be shipped jointly.
tested against a lower bound generated by solving a Lagrangian
The proposed problem (P) is
X relaxed version of (P). However, to show that the adoption of the
min CVaRa ðv Þ ð4Þ most direct approach to solve such a hard problem, which is its
v implementation in a state-of-the-art commercial solver is not effi-
cient due to the solution difficulty, we also solved many problem
Subject to instances with various number of hazmat shipments under differ-
ent scenarios using CPLEX. It places increased emphasis on the

5
S. Davod Hosseini and M. Verma Computers and Operations Research 129 (2021) 105222

motivation for developing a specialized solution procedure for the X2w

problem, as it is not able to find good (let alone optimal) integer
where uk  0; 8k and uij  0; 8ði; jÞ are the vectors of dual variables
solutions for even small problem instances in a reasonable amount
(Lagrangian multipliers) for constraint sets (9) and (10), respec-
of time. The implementation of the problem (P)’s mathematical
tively. After some computation, we can rewrite the Lagrangian func-
model in CPLEX is done via using the risk equity constraints (9)
tion as follows:
and (10) as described in the following subsection, and the detailed
results are provided in the computational analysis section. To facil- LðuÞ ¼ min
r
itate flow, we first outline the steps involved in generating the 0 0  1 1
relaxed problem, and then discuss the heuristic algorithm. X X X pvk cvk  C vðrÞ
@C v þ @ þ Nðv Þ uk pk ck Axvks0 ks A
ðr Þ
v s;s0 k; cvk >C vðrÞ
1a
4.2.1. Generating lower bound using Lagrangian relaxation
To test the effectiveness of the heuristic, we first develop the
0  1
pvij cvij  C ðvrÞ
lower bound using Lagrangian relaxed version of (P). More specif-
X X
ically, we dualize constraint sets (5) and (6). The left-hand-side þ @ þ Nðv Þ uij pij cij Axvis js
values of these constraints are calculated using N ðkÞ and N ði; jÞ in s ði;jÞ; cvij >C ðvr Þ
1a
(2) and (3), respectively, as follows X X
!  uk dk  uij dij
XX
Nðv Þxvks0 ks pk ck  dk 8k ð9Þ k ði;jÞ

v s;s0
Subject to
!
XX
Nðv Þxvis js pij cij  dij 8ði; jÞ ð10Þ X2w
v s
This Lagrangian function separates into jV j distinct shortest
where pk (or pij ) and ck (or cij ) are the incident probability and con- path problems; it will become more evident if we make the follow-
sequence, respectively resulting from transporting one hazmat rail- ing modifications
car at transferring yard k (or in arc ði; jÞ). The above constraints 8  
> v v v
< pk ck C ðrÞ þ Nðv Þu p c ;
demonstrate the expected consequences resulting from the total if cvk > C vðrÞ 8k; 8v
wvk ¼ 1a k k k
hazmat shipments that pass through each transferring yard and ð11Þ
>
:
arc in their journey from origin to destination. Hence, the Lagran- Nðv Þuk pk ck ; otherwise
gian function LðuÞ will be
8 
LðuÞ ¼ min >
> v v v
< pij cij C ðrÞ
r
0 0 þ Nðv Þuij pij cij ; if cvij > C vðrÞ 8ði; jÞ; 8v
wvij ¼ 1a ð12Þ
X 1 X X  >
>
@C v þ @ pvk cvk  C vðrÞ xvks0 ks :
 ðr Þ Nðv Þuij pij cij ; otherwise
v 1a s;s0 k;cvk >C ðvr Þ
! where wvk , wvij  0. This way the Lagrangian function will be
X X 
þ pvij cvij  C ðvrÞ xvis j !
X v
XX XX
wvk xvk 0 ks þ wvij xvis j
s
s ði;jÞ;cvij >C ðvrÞ LðuÞ ¼ min C ðr Þ þ
r s s
v s;s0 k s ði;jÞ
! X X
X XX  u k dk  uij dij
þ Nðv Þxvks0 ks uk pk ck k ði;jÞ
k v s;s0

! Subject to
X XX X X
þ Nðv Þ xvis j uij pij cij  u k dk  uij dij
ði;jÞ v s
s
k ði;jÞ
X2w
which can be restated as follows
Subject to

Fig. 1. Lagrangian function algorithm.

6
S. Davod Hosseini and M. Verma Computers and Operations Research 129 (2021) 105222

Step 1:
Step 2:

Step 3:

Step 4: step size

Step 5:

Fig. 2. Subgradient optimization algorithm.

X v X X
C ðrÞ þ f ðv Þ 
r
LðuÞ ¼ min uk dk  uij dij to increase for some fixed number of iterations. Lub is an upper
r
v k ði;jÞ bound on the optimal value LðuÞ, which can be the value of any pri-
mal feasible solution.
where
As alluded, Lagrangian relaxation method has been introduced
!
XX XX to supply us with a lower bound on the optimal solution. It enables
f ðv Þ ¼ min wvk xvk 0 ks þ wvij xvis j
r
s s
ð13Þ us to evaluate the maximum distance from the optimality of the
X2w
s;s0 k s ði;jÞ
solutions generated by the heuristic to be described in the next
which is a shortest path problem, as it represents finding the short- subsection.
est path for shipment v in the network where the costs (weights) of
yards and arcs are denoted by wvk and wvij , respectively. Finally, we 4.2.2. Determining k-minimal CVaR paths
propose an algorithm to solve LðuÞ, whose details are outlined in In this section, we propose a greedy heuristic algorithm to
Fig. 1. determine k-minimal CVaR paths while the equity constraints are
Subgradient search algorithm to determine the Lagrangian multi- satisfied. This algorithm is developed based upon Yen’s k-
pliers The Lagrangian dual problem, max fLðuÞju  0g, is in general shortest path algorithm (Yen, 1971). Yen’s procedure is a classic
difficult to solve exactly, and may be approximately solved by algorithm for ranking the k-shortest simple paths among the set
means of the well-known and widely-used subgradient technique of all paths between O-D pairs. It is an iterative algorithm that at
(Held et al., 1974). A vector c is a subgradient of LðuÞ at u if and only each iteration selects the shortest path from the candidate set of
if LðuÞ  LðuÞ þ ðu  uÞT c. Let CðuÞ denote the set of optimal solu- paths, which is then updated and deviates from the paths selected
tions for the Lagrangian function at u, if x 2 CðuÞ, then it can be in the previous iterations. Our proposed algorithm not only pro-
shown (Martin, 1999) that the following vectors c are subgradients vides a good initial primal feasible solution to be used in the Sub-
of LðuÞ at u gradient algorithm, but also can be regarded as a stand-alone
! solution algorithm, as will be shown in the next section. Other
XX approaches to finding a set of spatially dissimilar paths in hazmat
ck ¼ dk þ N ðv Þxvks0 ks pk ck 8k
v s;s0
route planning can be found in Dell’Olmo et al. (2005), Caramia
et al. (2010), and Bronfman et al. (2015).
! The main idea in this algorithm is that we start with the ship-
XX
cij ¼ dij þ N ðv Þxvis j s pij cij 8ði; jÞ ment which has the highest number of hazmat railcars and do its
v s optimal routing in such a way that the CVaR risk associated with
the generated route is minimized. We repeat this process for the
Next, we utilize them to develop the algorithm depicted in
next highest number of hazmat railcar shipment, but then check
Fig. 2.
if the created minimum CVaR route violates any of the risk equity
To calculate the Lagrangian function for the first time, we ini-
constraints for the arcs and/or transferring yards or not. If so, we
tialized the Lagrangian multipliers to zero
remove the corresponding arcs and/or transferring yards from
(uk ¼ 0; 8k and uij ¼ 0; 8ði; jÞ). Then the multipliers get updated
the network and do a rerouting to find the next minimal CVaR route
by the Subgradient optimization algorithm (Fig. 2) with the objec-
for this shipment. This process is repeated as many times as
tive of maximizing the Lagrangian function (LðuÞ). Through the
required until a minimal CVaR route is found for the shipment.
above algorithm, the sequence of dual solutions fuq g approaches
  Likewise, this procedure is iterated until all hazmat shipments in
an optimal solution fu g, however the value of L uqþ1 is not nec-
the network are routed. It is worthwhile mentioning that when a
essarily greater than Lðu Þ. In fact, according to the fundamental
q
yard is removed from the network as a transferring yard, it may
theoretical result (Held et al., 1974), the sequencefLðuq Þg con-
  still be used in the routing of the next shipments as a transship-
verges to Lðu Þ if the sequence tq converges to zero ment yard.
P1
and q¼0 t q ¼ 1. It is common to determine t q by a formula such as To implement the proposed heuristic algorithm, we first rewrite
 the objective function of problem (P), (4), by using (8) as follows:
hq Lub  Lðuq Þ
tq ¼ X  X  v   
kcq k2 min
r
CVaRra v ¼ min
r
C ðr Þ þ f r v
v v
where hq is a positive scalar between 0 and 2 (Martin, 1999). We
determine hq by setting h0 = 2 and halving hq whenever LðuÞ fails where
7
S. Davod Hosseini and M. Verma Computers and Operations Research 129 (2021) 105222

Fig. 3. Algorithm to generate k-minimal CVaR paths.

!
  XX 
v  XX 
v  5. Computational analysis
f r
v ¼ min
X2w
wk xvk 0 ks þ
s
wij xvis j s
ð14Þ
s;s0 k s ði;jÞ
In this section, the proposed analytical approach is applied to a
problem instance generated using the realistic infrastructure of a
Class I railroad operator, in the mid-west United States, that was
where
introduced in Verma et al. (2011). In addition, insights about various
pertinent drivers are developed to help managers make better deci-
8   sions. To that end, we first outline the specifics of the case study,
< pvk cvk C vðrÞ
wvk ¼ 1a
; if cvk > C vðrÞ 8k; 8v ð15Þ
which is then solved and analyzed to generate insights in the follow-
: ing subsections.
0; otherwise
5.1. Problem setting
8 
>
< pvij cvij CvðrÞ Fig. 4 depicts the infrastructure of a Class I railroad operator and
wvij ¼ 1a
; if cvij > C vðrÞ 8ði; jÞ; 8v ð16Þ was recreated using a geographical information system. Each of the
>
: 25 yards in the network is both a demand and a supply point for
0; otherwise
the others. However, we considered 560 different hazmat ship-
Next, we develop the steps as outlined in Fig. 3 to obtain the k- ments (o-d pairs) in the computational study, and where number
minimal CVaR paths as the equity considerations are taken into of hazmat railcars to be shipped between a given o-d pair, N(v),
account. ranges between [1,15]. We also assume a total of 31 different train
8
S. Davod Hosseini and M. Verma Computers and Operations Research 129 (2021) 105222

Fig. 4. Railroad network in mid-west United States.

services in the network, and each is identified by origin and desti-

Table 3 nation yards, intermediate stops, and service legs that connect
Train services. them (Table 3). The value of a was set to 0.999999 throughout
Origin Destination Number of Stops
all the analyses. The k-minimal CVaR paths algorithm and the
Lagrangian method algorithm were implemented in Java 1.9, the
Chicago Detroit 3
Chicago Cleveland 2
mathematical model implementation on CPLEX 12.10 was done
Chicago Columbus 2 in Python 3.7, and they were all run on a Intel Core i7-8650U
Chicago Indianapolis 3 CPU @ 1.90 GHz PC with 16 GB of RAM. The details of computa-
Chicago Lexington-Fayette 3 tional times are provided in Tables 4, 5, and 6.
Chicago Middlesborough 4
Estimation of hazmat risk: As explained in Section 3.1,
Detroit Indianapolis 5
Detroit Middlesborough 3 incident probabilities in yards and arcs, pvk andpvij , depend on the
Detroit Cleveland 3 number of hazmat railcars in shipment v , Nðv Þ. In addition, pvij is
Grand Rapids Columbus 9
dependent on the length of the arc, and computed as
Indianapolis Northbrook 2
Indianapolis Middlesborough 4 follows: pvij ¼ arcði; jÞ0 s length ðmileÞ  7:35  1011  N ðv Þ and
pvk ¼ 6:42  1010  N ðv Þ. To calculate accident consequences in
Indianapolis Cadillac 3
Indianapolis Cleveland 2
Indianapolis Columbus 2 yards and arcs, cv and cv , ArcGIS (ESRI, 2007) was used to estimate
k ij
Indianapolis Chicago 2 population exposure which is utilized as the measure of conse-
Columbus Chicago 3
quence in this research. The techniques used to estimate these
Columbus Granite City 3
Columbus Cadillac 4 parameters are borrowed from other peer-reviewed works. For
Columbus Madisonville 2 the sake of brevity, we do not repeat the details here, and refer
Cleveland Chicago 5 the reader to Verma and Verter (2007), Verma (2011), and
Cleveland Paducah 3 Hosseini and Verma (2017).
Cincinnati Detroit 2
Lexington-Fayette Chicago 2
Lexington-Fayette Chicago (2nd) 7
Lexington-Fayette Grand Rapids 1 5.2. Role of train service design
Middlesborough Fort Wayne 1
Madisonville Detroit 5 Given that the case study is based on the train services used in
Paducah Columbus 3
Verma et al. (2011), our intention was to use only those train ser-
Middlesborough Cleveland 1
Middlesborough Detroit 3 vices. However, after some iterations, we realized that the current
design would not allow us to obtain results from applying the k-
9
S. Davod Hosseini and M. Verma Computers and Operations Research 129 (2021) 105222

Table 4
(a) Number of shipments rerouted by the k-minimal CVaR paths algorithm to ensure risk equity for transporting 560 shipments (b) k-minimal CVaR paths algorithm gap from the
Lagrangian lower bound.

dij &dk 105 Subgradient Optimization Algorithm k-minimal CVaR Paths Algorithm
P
v CVaRa ðv Þ

Computational max LðuÞ Number of Shipments Re-routed (RR = re- Computational r Gap from the
Time (20 (Lagrangian lower routing) Time Lagrangian lower
iterations) bound) bound
1st 2nd 3rd 4th 5th 6th 7th
RR RR RR RR RR RR RR
235 & 1 21 min, 38 s 151,221.05990 6 0 0 0 0 0 0 1 min, 3s 151,337 0.08%
230 & 1 20 min, 19 s 151,221.05551 9 0 0 0 0 0 0 1 min, 3s 151,404 0.12%
225 & 1 20 min, 44 s 151,221.05524 14 3 0 0 0 0 0 1 min, 3s 151,589 0.24%
220 & 1 20 min, 05 s 151,221.06661 20 4 0 0 0 0 0 1 min, 2s 151,823 0.40%
215 & 1 20 min, 58 s 151,221.06563 26 3 0 0 0 0 0 1 min, 5s 152,025 0.53%
210 & 1 21 min, 18 s 151,221.06385 33 6 0 0 0 0 0 1 min, 6s 152,250 0.68%
205 & 1 20 min, 03 s 151,221.07832 42 11 0 0 0 0 0 1 min, 12 s 152,658 0.95%
200 & 1 22 min, 6s 151,221.07973 49 10 0 0 0 0 0 1 min, 9s 153,174 1.29%
195 & 1 20 min, 19 s 151,221.08388 55 14 4 0 0 0 0 1 min, 14 s 153,448 1.47%
190 & 1 18 min, 31 s 151,221.10173 64 20 8 0 0 0 0 1 min, 11 s 154,162 1.94%
187 & 1 21 min, 50 s 151,221.08231 68 21 8 0 0 0 0 1 min, 21 s 154,645 2.26%
1 & 19 20 min, 52 s 151,221.07527 4 0 0 0 0 0 0 0 min, 58 s 151,417 0.13%
1 & 18 18 min, 51 s 151,221.12554 5 0 0 0 0 0 0 1 min, 0s 151,454 0.15%
1 & 17 22 min, 33 s 151,221.10585 29 5 0 0 0 0 0 1 min, 7s 151,670 0.30%
1 & 16 20 min, 52 s 151,221.11382 48 9 0 0 0 0 0 1 min, 11 s 151,953 0.48%
1 & 15 20 min, 23 s 151,221.10554 59 17 0 0 0 0 0 1 min, 3s 152,551 0.88%
1 & 14 18 min, 37 s 151,221.13063 71 25 1 1 0 0 0 1 min, 12 s 153,414 1.45%
1 & 13 19 min, 5s 151,221.13670 88 34 2 2 1 0 0 1 min, 10 s 154,327 2.05%
1 & 12 19 min, 20 s 151,221.14796 107 55 14 8 6 0 0 1 min, 23 s 157,092 3.88%
1 & 11 21 min, 13 s 151,221.14074 129 72 31 17 12 2 0 1 min, 24 s 159,564 5.52%
1 & 10 22 min, 41 s 151,221.14410 153 93 52 32 27 13 2 1 min, 36 s 163,606 8.19%
235 & 19 21 min, 29 s 151,221.09926 9 0 0 0 0 0 0 1 min, 5s 151,523 0.20%
230 & 18 21 min, 19 s 151,221.03638 13 0 0 0 0 0 0 1 min, 14 s 151,611 0.26%
225 & 17 20 min, 44 s 151,220.95954 40 11 4 1 0 0 0 1 min, 12 s 151,971 0.50%
220 & 16 20 min, 40 s 151,220.95171 65 29 11 3 0 0 0 1 min, 20 s 152,710 0.98%

minimal CVaR path algorithm (Fig. 3). This exercise enabled us to
discern the importance of train service design in ensuring risk
equity, and motivated the re-design of some pre-defined train
services. For instance, relying on the train services as identified
in Verma et al. (2011), all shipments from yards at Cadillac and
Grand Rapids (i.e., yards 16 and 17) to other yards are forced to
go through service leg Cadillac-Lansing, i.e., 16 ? 18 (Fig. 5). Since
a total of 346 hazmat railcars are leaving these two yards,
and hence the hazmat risk load on arc (16,18), i.e., the LHS of
equation (10), is always greater than or equal to
ð346Þ  161  0:735  1010  1940 ¼ 0:007943, where 161 is the
length of arc (16,18) in miles, and 1940 shows the population
exposure around this arc.
Therefore, it is not possible to reduce the risk load on this over-
loaded arc (just by rerouting the shipments) unless new service
legs are provided. In fact, when arc (16,18) is removed from the
network by the k-minimal CVaR paths algorithm, no alternative
service legs are provided by the train services to be used for rout-
ing shipments like (O = 17, D = 14) and (O = 16, D = 14), hence Dijk-
stra’s shortest path algorithm becomes infeasible too soon and the
algorithm stops. We resolved this issue by re-designing the two of
current train services in the network, namely, train service {Chi-
cago To Indianapolis} and {Indianapolis To Cadillac}, and changed
them from Chicago -> Portage -> Lafayette -> Indianapolis and Indi-
anapolis -> Fort Wayne -> Grand Rapids -> Cadillac to Grand Rapids -
> Portage -> Lafayette -> Indianapolis and Indianapolis -> Fort Wayne
-> Grand Rapids -> Lansing, respectively. This way, two new service
legs Grand Rapids -> Portage and Grand Rapids -> Lansing will be
added to the network (see Fig. 5), which help to prevent overload-
ing on arc (16,18) and consequently enhance risk equity in the
whole network.
5.3. Risk equity analyses
In this subsection, we analyze how imposing risk equity con-
straints on transferring yards and arcs affect optimal CVaR routing
of the rail hazmat shipments throughout the network. To do so, we
initially solve problem (P) without enforcing risk equity con-
straints -i.e., ignoring constraints (9) and (10), where the objective
is just to route all the hazmat shipments such that the total CVaR
risk is minimized. The resulting solution was decoded, and it turns
out that the maximum hazmat risk was registered on the service
leg Chicago-Portage -i.e., arc (2,6), and at the transferring yard at
Chicago with respective risk values of 242  105 and 21  105 .
Subsequently, (P) was solved three more times: first, with just
the risk equity constraints on the arcs, the details of which are dis-
cussed in Section 5.3.1; second, with just the risk equity constraints
on the yards, and the resulting insights are provided in Sec-
tion 5.3.2; and third, with constraints on both yards and arcs, and
the related details are discussed in Section 5.3.3. The k-minimal
CVaR paths algorithm is then applied to each of these three scenar-
ios while dij and dk values are set to gradually decrease from the
maximum risk load numbers found above (when there are no risk
equity constraints in the problem). Reducing d values continues
until the algorithm reports an error resulting from the infeasibility
of Dijkstra’s shortest path algorithm since no alternative route can
be found after all overloaded arcs and/or transferring yards are
removed from the network.
5.3.1. Risk equity constraints only on arcs
In the first scenario, as the max risk allowed on the arcs declines
gradually, the transferring yard risks increase. Fig. 6 depicts how
making the dij values tighter causes the risk load at the riskiest

10
S. Davod Hosseini and M. Verma Computers and Operations Research 129 (2021) 105222

transferring yards of the network to enlarge. It means that ensur-

ing a lower level of risk on all the arcs of the network will result
Lagrangian lower in higher level of risk at the transferring yards. Fig. 7 provides an
example of step-by-step rerouting done by the k-minimal CVaR
Gap from the

paths algorithm to finally find a route for the 468th shipment

withO = 14, D=1, and N = 3, while the risk equity of 187  105 is
bound

met on all the arc of the network. Fig. 7a depicts the original route
0.0%
0.0%
0.0%
0.0%
0.0%
0.0%
0.0%
0.0%
0.0%
0.0%
0.0%
0.0%
0.0%
0.0%
0.0%
where hazmat risk on arc (3,5), connecting Washington to Granite
k-minimal CVaR Paths Algorithm

City, exceeds the specified value. It is worthwhile to mention that

v CVaRa ðv Þ

the original route ignores risk-equity constraint, and thus would be

r

1538.3
1948.8

1538.3
1948.8

1538.3
1948.8
944.9
1035.6

3805.4
944.9
1035.6

3805.4
944.9
1035.6

3805.4
the output of the model proposed in Hosseini and Verma (2018).
However, the methodology proposed in this paper seeks to impose
P

risk-equity constraints, and hence arc (3,5) is removed and the

Computational

shipment re-routed as depicted in Fig. 7b. Unfortunately, hazmat

risk on constituent arc (3,4) exceeds the threshold. Now, re-
routing is attempted after removing both arc (3,5) and arc (3,4),
Time

which then results in two arcs violating the threshold risk

17 s
11 s
11 s

16 s

14 s
10 s

10 s

10 s
9s
9s

9s

9s
9s

9s
9s

(Fig. 7c). Finally, following removal of four arcs and 3rd re-
routings, the shipments reach their destination without violating
max LðuÞ (Lagrangian
Subgradient Optimization Algorithm

the threshold hazmat risk imposed on all the arcs in the network
(Fig. 7d). For visual impact, we have used dotted line scheme to
lower bound)

depict arcs violating the risk equity constraints in the preceding

steps, and used different colors to distinguish the various train ser-
1538.3
1948.8

1538.3
1948.8

1538.3
1948.8
944.9
1035.6

3805.4
944.9
1035.6

3805.4
944.9
1035.6

3805.4

vices in the network. In addition, the CVaR values are indicated for
each routing scheme, and it is intuitive to predict that consequent
CVaR values increase, given removal of overloaded arcs from the
Computational
(20 iterations)

network.
Time

5.3.2. Risk equity constraints only on yards

s
s
s
s
s
s

s
s
s
s

s
s
s
s

s
19
19
21
23
29
19

21
23
29
18

21
22
28
20

20

Under the second setting, we impose risk equity constraints

only at the transferring yards, and analyze the impact on the haz-
26.1%
37.8%

26.1%
37.8%
52.1%
52.0%
0.0%
0.0%
0.0%
0.0%
0.0%
0.0%
0.0%

0.0%
0.0%
Gap

mat risk loadings at the top arcs of the network. Clearly tighter
threshold values at the yards are increasing hazmat risk at some
Best Lower

of the most used arcs in the network, and the top eight are depicted
1538.3
1948.8

1136.1
1282.7
1822.9

1136.1
1282.7
1822.9
944.9
1035.6

3805.4
944.9
1035.6

944.9
1035.6
Bound

in Fig. 8. We demonstrate application of k-minimal CVaR path algo-

rithm through the routing of the 547th shipment with O = 15,
D = 18, and N = 2, while the risk equity is 10  105 at all the trans-
Best Integer

ferring yards. Fig. 9 depicts the 5 re-routings required to move the

Solution

shipments, and the process is similar to that for arcs. For instance,
944.9
1035.6

3805.4
944.9
1035.6

2062.3
3805.4
944.9
1035.6

2062.3
3805.4
1538.3
1948.8

1538.3

1538.3

the transferring yards that violate the risk threshold value are
removed in the subsequent re-routing, and are depicted using a
CPLEX vs k-minimal CVaR paths algorithm solutions for very small problem instances.

dotted red rectangle. It is important that a yard identified as an

Computational

overloaded transferring yard will not be used for routing new ship-
of 6 h
of 6 h
of 6 h

of 6 h
of 6 h
of 6 h

ments, but could still serve as a transhipment yard, i.e., there is no

Limit
Limit
Limit

Limit
Limit
Limit
Time

transfer operation between two or more trains services. An exam-

15 s
2s
4s
6s
7s

1s
5s

1s
4s

ple of this is Lexington-Fayette in Fig. 9, where it is removed from

the network because of being an overloaded transferring yard in
Constraints

the original route, but then used in the second rerouting as a trans-
Number of

shipment yard.
1617

1328
1725
2123
4112
1303

2098
4087

1220

2015
1700

4004
824

932
907
CPLEX MIP Solver

5.3.3. Risk equity on both arcs and yards, i.e., (P)

Finally, in the last scenario, we solve (P) using the k-minimal
Number of
Variables

CVaR paths algorithm, where both risk equity constraint on arcs

14,078

14,078

14,078
2818
4223
5632

2818
4223
5632

2818
4223
5632
7039

7039

7039

and transferring yards are considered. Fig. 10 demonstrates the

steps have been taken by the algorithm for rerouting and conse-
quently building a route for the 497th shipment with O = 7, D=3,
Number of

and N = 2, while maximum risk load dij ¼ 220  105 and

Shipments

dk ¼ 16  105 are imposed on all the arcs and transferring yards

10

10

10

of the network, respectively. Now the algorithm performs the re-

2
3
4
5

2
3
4
5

2
3
4
5

routing in such a way that both overloaded arcs and transferring

dij &dk 105

yards are avoided simultaneously. A total of four re-routings is

needed to move the shipment while ensuring that specified risk
220 & 16
220 & 1


1&16

values are not violated at the yards and arcs in the network.
Table 5

The number of shipments re-routed by the algorithm to ensure

risk equity throughout the network in all the three scenarios are
11
S. Davod Hosseini and M. Verma Computers and Operations Research 129 (2021) 105222

Table 6
CPLEX vs k-minimal CVaR paths algorithm solutions for larger problem instances.

dij &dk 105 Number CPLEX MIP Solver (time limit of 6 h) Subgradient Optimization k-minimal CVaR Paths Algorithm
of Algorithm (20 iterations)
Shipments P
v CVaRa ðv Þ

Number Number of Best Best Gap Computational max LðuÞ Computational r Gap from
of Constraints Integer Lower Time (Lagrangian Time the
Variables Solution Bound lower Lagrangian
bound) lower
bound
220 & 16 15 21,123 6121 7202.7 2169.3 69.9% 34 s 7058.0 11 s 7058.0 0.0%
20 28,154 8094 9922.0 1328.0 86.6% 44 s 9640.0 12 s 9772.1 1.4%
44 61,946 17,513 None None N/A 1 min, 50 s 18,953.3 18 s 19,318.2 1.9%
147 206,925 58,260 None None N/A 5 min, 6 s 47,431.0 22 s 47,653.2 0.5%
287 403,971 113,395 None None N/A 11 min, 10 s s 80,252.7 37 s 80,617.7 0.4%
560 788,272 221,024 None None N/A 20 min, 40 s 151,220.9 1 min, 22 s 152,710.4 1.0%

Furthermore, as discussed above, CVaR value along with the gener-

ated route for each hazmat shipment increases as the risk equity
constraints on arcs and transferring yards become tighter. It should
be clear that the limitation imposed by the risk equity causes the
shipments to undergo possible several re-routings. This means
deviation from the original routes with the corresponding mini-
mum CVaR values which could be achieved in the absence of risk
equity constraints. Fig. 11 elucidates how the total optimal CVaR
value, gained by the summation of optimal CVaR values of all the
shipments in the network (after the re-routings), rise by imposing
the maximum risk enforcement on the arcs and transferring yards
in all the three scenarios.

5.4. Optimality evaluation of solutions

Finally, in this subsection, we compare the results of our pro-

Fig. 5. Re-designing the train services to ensure risk equity.
depicted in Table 4. It is clear that with tighter risk thresholds, a
larger number of shipments requires higher number of re-
routing. While only at most three re-routings are noticed when
tighter values are imposed on the arcs, the required re-routings
rise up to seven when tighter thresholds are imposed on the yards.
posed k-minimal CVaR paths algorithm with the outputs of the
mathematical model’s implementation on CPLEX as well as the
lower bounds generated by maximizing the Lagrangian function.
Out of all the problem instances under different scenarios, CPLEX
was able to find the optimal solutions for only some of the very
small problem instances (up to 10 shipments) as shown in Table 5.
It could not guarantee the optimality of the best integer solutions
found within a 6-hour running time for other small problem
instances. Note that the k-minimal CVaR paths algorithm was able
to find all of these optimal and best solutions found by CPLEX in

Fig. 6. Hazmat risk at transferring yards as risk equity threshold becomes tighter on arcs.

12
S. Davod Hosseini and M. Verma Computers and Operations Research 129 (2021) 105222

Fig. 7. k-minimal CVaR paths determination for the 468th shipment by imposing risk equity constraint (only) on arcs: dij ¼ 187  105 .

Fig. 8. Hazmat risk at top eight arcs as risk equity threshold becomes tighter at the yards.

13
S. Davod Hosseini and M. Verma Computers and Operations Research 129 (2021) 105222

Fig. 9. k-minimal CVaR paths determination for the 547th shipment by imposing risk equity constraint (only) on transferring yards: dk ¼ 10  105 .

14
S. Davod Hosseini and M. Verma Computers and Operations Research 129 (2021) 105222

Fig. 10. k-minimal CVaR paths determination for the 497th shipment by imposing risk equity constraint on arcs and transferring yards: dij ¼ 220  105 and dk ¼ 16  105 ,
respectively.

15
S. Davod Hosseini and M. Verma
Fig. 11. Increase in the total optimal CVaR as a result of imposing risk equity constraints.
less than 20 s with a 0.0% gap from the corresponding Lagrangian
lower bounds. For larger problem instances, the number of deci-
sion variables and constraints increase exponentially: for the case
with 560 hazmat shipments there are more than 788,000 variables
and 221,000 constraints. This coupled with the complexity of
objective function and constraints forbid CPLEX to output an inte-
ger solution and lower bound even after a time limit of 6 h in most
of the cases, while our algorithm could find better solutions in less
tan 90 s (see Table 6).
We attempted to solve the Lagrangian dual problem
max fLðuÞju  0g to achieve an effective lower bound on the opti-
mal solution values for the scenarios studied in Section 5.3. To
P
v CVaRa ðv Þ, which are gained by
do so, we plug the values of r
the k-minimal CVaR paths algorithm (Fig. 3) and used to build
the above discussions in Sections 5.2 and 5.3, into the Subgradient
algorithm (Fig. 2), where at each step, they are used as Lub , an upper
bound on the optimal value LðuÞ, in the step size t q calculation. At
each iteration q of the Subgradient algorithm, we first calculate
Lðuq Þ using the Lagrangian function algorithm (Fig. 1), which is
then utilized to compute the subgradients cq . Consequently, we
update Lagrangian multipliers uq by means of the step size
hq ðLub Lðuq ÞÞ
tq ¼ kcq k2
.
To find good initial values for variables u (at iteration q ¼ 0), we
set them (all the multipliers u0k , 8k and u0ij , 8ði; jÞ) to random values
in the ranges ½0; 1; ½0; 1  10; ½0; 1  102 ; ½0; 1  103 ;
½0; 1  10 ; and ½0; 1  105 . It turns out that initiating the Subgradi-
4 demonstrated by the lower bound provided by a Lagrangian
ent algorithm with random variables u in ½0; 1 will ultimately lead to
the best (maximum) LðuÞ. An example is provided in Fig. 12 for the
case in which we impose the maximum risk of 235  105 and
19  105 on the arcs and yards, respectively. While using larger ini-
tial u values, Subgradient algorithm gradually increases LðuÞ, by
using random values in ½0; 1 as initial u, LðuÞ fails to increase after
some number of iterations. This observation shows the algorithm
has already found the maximum/best lower bound and is not able
to find a better one. Recall that we aim to maximize the Lagrangian
function, max fLðuÞju  0g, to find the best lower bound on the opti-
mal solution (as the main problem is minimization).
16
Computers and Operations Research 129 (2021) 105222
P
In Table 4, we compare the solution values v CVaRra ðv Þ (i.e. the

values of total CVaR for all the shipments in the network) gained by
the k-minimal CVaR paths algorithm for all the different scenarios
with the Lagrangian lower bound. It lists the values of the relative
gap (in percentage) of the solution values with respect to the lower
P
v CVaRa ðv Þ  LB =LB %. Comparing to the lower
r
bound LB, i.e.
bound, we conclude that the quality of the solution values is high
with an average relative gap of 1.40% and a maximum value of
8.19%. The computational time requirements of both methods for
all the scenarios are also reported in Table 4. A maximum of
100-second computational time validates the quickness of the pro-
posed solution methodology as well.
6. Conclusion
In this paper, we have studied equitable routing of rail hazmat
shipments between multiple pairs of origin–destination yards. To
this end, we propose an analytical methodology that finds the best
route for each hazmat shipment such that the sum of the resulting
CVaR-based hazmat risk along the routes is minimized while
adhering to the maximum threshold risk imposed on rail-arcs
and transferring yards in the given railroad network. A k-
minimal CVaR paths algorithm was developed and experimentally
evaluated on the realistic infrastructure of a Class I railroad opera-
tor in the United States, whose efficiency and effectiveness was
method, and by the (near-)optimal solutions found by CPLEX for
very small problem instances. It was also demonstrated that the
inability of CPLEX to generate integer solutions for even small
problem instances’ mathematical model stresses the complexity
of solving the problem and the necessity of developing a special-
ized solution methodology.
This paper has a three-fold contribution: first, this is the first
effort that illustrates how to incorporate characteristics of railroad
accidents in developing a CVaR-based risk methodology with risk
equity consideration; second, through numerical experiments we
demonstrate the impact of risk-equity constraints on optimal CVaR
values, on optimal routing of hazmat shipments, and the trade-off
S. Davod Hosseini and M. Verma
Fig. 12. Changes in LðuÞ by iterating Subgradient algorithm with different initial values of u for risk equity dij ¼ 235  105 and dk ¼ 19  105 .
between yard-risk and arc-risk; and third, demonstrate how the
design of train services can influence the risk equity in the whole
network, and how beneficial it could be to invest in a revised
design of them.
There are a number of areas of future research. First, given the sig-
nificance of hazmat freight, CVaR risk and risk-equity could be con-
sidered explicitly when designing train services. Second, integrate
routing and scheduling to facilitate safer routing of shipments, and
yard transfer operations considering other ongoing operations at a
given yard. Third, develop robust formulations to tide over the
imprecision associated with accident probability and consequence
data, and devise routing strategies that are less sensitive to changes
in arc/yard attributes or data inaccuracy. Fourth, investigate the
trade-off between risk-equity and travel time (or cost).
CRediT authorship contribution statement
S. Davod Hosseini: Methodology, Software, Validation, Formal
analysis, Investigation, Writing - original draft. Manish Verma:
17
Computers and Operations Research 129 (2021) 105222
Conceptualization, Formal analysis, Investigation, Writing - review
& editing, Supervision, Funding acquisition.
Acknowledgement
This research has been supported by a grant from the Social
Sciences and Humanities Research Council of Canada (435-1178-
2015). The authors would like to thank two anonymous referees
whose feedback improve the paper significantly.
Appendix A. Supplementary data
Supplementary data to this article can be found online at
https://doi.org/10.1016/j.cor.2021.105222.
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