Optimization the Location of Container Depots with Environmental Constraints

HE Peiqing
Department of Business Administration, Qingdao Hotel Management College, Qingdao 266000
E-mail:qingpeihe@126.com

Abstract: The paper provides a new way to optimize the location of container depots. According to the environmental
effect brought by the daily operation of depots, in the optimal model both cost and environmental constraints are taken
into account. In order to assess the environmental effect caused by depots, an AHP model was used in the paper. Because
of the environmental constraints are considered in the model, the decision of the location of depots can not be made just
according to cost. In order to test the model, it is implemented to locate the depots around Qingdao port.
Key Words: Container, Depot, Environmental Effect, Optimization

environmental factors. In this paper, a model was proposed

1 INTRODUCTION
There is no doubt that container depot is an important node
of container transportation network. Generally container
depots have following functions. First of all, since the
capacity of container terminal is not enough to store empty
containers for all shipping lines, so most of shipping lines
have to store empty containers in depots out of terminal.
Secondly, depots can also provide container maintenance
services, which include container repairing, container
washing, container inspecting and so on. Thirdly, in recent
years more and more depots begin to provide logistics
service to exporters and importers, such as warehouse
service; distribution service and so on.
When shipping lines choose the location of depots, they
mainly consider two import factors, the cost generates from
the depots and the service quality of depots. In recent years,
different approaches have been proposed to optimize the
location of depots. For instance, Chien-Chang Chou
proposed a mixed fuzzy optimal model to make decision
and optimize the empty containers allocation problem [1].
Bernard Gendron provided a branch and bound algorithm
for depot location and container fleet management [2].
Neha Mittal provided a way to determine optimal inland
container depot locations under stochastic demand [3].
It is obvious that when depots serve for shipping lines, their
operation can cause various environmental problems. At
present, the transportation of empty containers in depot
mainly depends on container truck. Container truck is an
important source of environmental pollution. The
environmental problem of depots attracts more and more
attention and finally will become the constraint and
increase the cost of their operation. Now the environmental
effect of container depot has been studied by many experts.
For instance, Lättilä, Ville Henttu has studied on dry port
usage effects on transportation costs and CO2 emissions [4].
Hyuk-soo designed to empirically investigate country's
external environments to increase container traffic volumes
[5].
As the user of container depots, shipping lines also have to
face these environmental problems. So when they choose
depots to store containers, they need to consider
to locate the container depots. The model minimizes not
only the cost of depot but also the environmental
constraints are included.
When container depots serve for shipping lines, the
containers follow can be illustrated in the figure 1. When
container ships berth in terminal, inbound containers are
unloaded from these ships and at the same time outbound
containers are loaded on the ships. Then the inbound empty
containers are sent to depots and full containers are sent to
consignees. After the full container being unloaded by
importers, the empty containers will also be sent to depots.
When exporters need empty containers, they can get them
in depots. It should be noted that empty containers
sometime can also be sent to terminal from depots, and then
they will be loaded on ship and transported to another
terminals. In order to allocate empty containers between
depots, empty containers are also sometimes transported
between depots.
Figure.1 Moves of Container Flow
2 THE OPTIMAL MODEL WITH
EVIRONMENTAL CONSTRAINTS
As analyzed above, both costs and environmental factors
should be considered when container depots are located.
Based on this rule the optimal model is formulated. The
objective function of the model is to minimize the cost of
transportation and environmental effect.

978-1-4799-3708-0/14/$31.00 2014
c IEEE 3239
 In the model the parameters and decision variables can be flowing into depots should equal to these flowing out.
defined as follow: Constraint (6) ensures empty containers can only be
i,j index of importers and exporters i=1,2,3...k, j=123...k transported between selected depots. S should be a large
k index of container depots, k=1,2,3...K enough number. Constraint (7) gives the number of depots
selected by shipping companies. Constraint (8) demonstrate
cik cost to send container from exporter i to depot k,
container terminal as one of the selected depots. Constraint
ckj cost to send container from depot k to importer j (9) and (10) gives the range of variables.
Ii the number of containers unloaded by importer i In the formulated model the environmental impact is also
Ej the number of containers needed by exporter j an important factor in the objective function. In recent years
TR the number of containers needed to transport to the environment pressure has been increased so fast in
terminal China. The operation of depots can cause serious
g the number of depots to be selected environment problems. At present the main environmental
uk 1 or 0 according to weather a depot is selected or not problems of most depots include exhaust pollution,
auditory pollution, traffic pressure, traffic accidents and
fik the proportion of containers unloaded by importer i that
destruction of ecology and so on.
are sent to depot k
Although to assess the environmental problems caused by
fkj the proportion of containers which exporter j get from
depots seems to be difficult, recently more and more
depot k
attention has been put on the issue and different approaches
rtk the number of containers transported from depot t to have been proposed to evaluate environmental influence of
depot k transportation and relevant facilities.
hk the environmental effect factor to transport a container In this paper, an AHP model was introduced to evaluate
in or out of depot k environmental effect of depots. The AHP model now was
widely used in decisions which can not be made only by
The model is as follow: quantitative methods. Science some environmental
K K n K K m problems caused by depots can not be evaluated by
Minimize Z =¦¦ctk rtk +¦¦cik Ii fik +¦¦ckj Ej fkj quantitative methods completely; the qualitative methods
t =1 k i=1 k =1 k =1 j =1
should be applied so as to get a reliable conclusion. When
K k n m
AHP model need to be constructed, the relevant
+¦hk (¦rtk + ¦Ii fik + ¦Ej fkj )
k =1 t =1 i=1 j =1
environmental problems of depots should be considered in
the model will vary according to the areas where the depots
subject to: are located in, that means there is no fixed environmental
k
factors for the AHP model.
¦f
k =1
ik =1 (1)
k
3 THE APPLICATION OF THE MODEL
¦f
k =1
kj =1 (2) In this paper, the model was impended to optimize the
location of container depots in Qingdao. It is well known
fik ≤ uk (3) that Qingdao is an important port city. The Qingdao port
fkj ≤ uk (4) has huge throughput of different kinds of cargo, such as dry
bulk cargo, container, crude oil, and general cargo. In
{
n m

¦r + ¦I f − ¦r − ¦E f
tk i ik kt j kj = TR, if k=1, ∀k (5) recent years due to the fast development of foreign trade,
t ≠k i =1 t ≠k j =1
0, otherwise the throughput of cargo in Qingdao port has grown steadily.
k
In order to increase the capacity of port, the space of the
¦r
t ∋k
tk +rkt ≤ S ⋅ u
k
(6) port has also expanded fast in recent years. The location of
k
Qingdao port can be illustrated in figure2. In the figure we
¦u
k =1
k =g (7) can see that the whole port is composed of three parts and
the function of each part is different. Now the container
u1 = 1, (8) terminal of Qingdao port is on the west coast of Qingdao.
The throughput of containers of the terminal also grows fast
fik ≥ 0, fkj ≥ 0, rtk ≥ 0, uk = 0,1 (9)
in recent years. In 2012 the throughput of container
0< hk ≤ 1 (10) terminal of Qingdao port has reached 1450 million TEU.
Although the space of container yard of the terminal has
In the model, constraint (1) ensures all empty containers reached 2.25 million m2, most of empty container has to be
unloaded by importers should be sent to depots. Constraint stored out of the terminal because of the limited capacity of
(2) ensures that exporters can only get empty containers the yard. Now there are 30 container depots out of the
from depots. Constraint (3) ensures that importers can only terminal which can serve for shipping lines and their
send empty containers to selected depots. Constraint (4) locations can be illustrated in figure 2. Now the storing
ensures that exporters can only get empty containers from capacity of most of these depots is from 30,000 to 60,000
selected depots. Constraint (5) ensures container flows TEU. At present most empty containers are stored in these
conservation; that means the number of empty containers depots by shipping liners. When exporter has loaded a

3240 2014 26th Chinese Control and Decision Conference (CCDC)

container, they also should send the container into the depot
firstly and then depot will send the loaded containers to
terminal according to the yard schedule.
Fig.2 Location of Container Depots Around Qingdao Port.
In the daily operation, there are many containers trucks that
go into and out of these depots, which has caused serious
environmental pressure to the city. In recent years, the
government has began to take measures to solve this issue,
for example, from 2005 the Qingdao environmental agency
has began to introduced evaluation of environmental effect
of depots. According to the environmental effect of each
depot, environmental agency has the right to limit the
number of containers handled by depots. And this will
Table1. Environmental Effect Weights of Each Depot
definitely increase the operation cost of the depots which
have serious environmental effect.
In the formulated AHP model, according the location and
environment effect of these depots, five most import factors
are evaluated. In the model the comparison matrix can get
from questionnaire in which subjective assessment of
different factors and depots was made by experts.
According to comparison matrix, the weights of each factor
and depots can be computed. It is obvious that when experts
assess the environmental effect of depot, different experts
have different views on what is the most serious
environmental problem caused by depot, so it is normal we
can get different comparison matrix of this five factors. In
order to simplify the problem, only 20 depots is included in
the model. The weights of each factor and depot are
illustrated in table 1, and at the same time the
environmental factor hk of each depot can also be seen in the
table1. In table 1 the weights of five environmental factors
are 0.135, 0.536, 0.050, 0.128and 0.151.
Science hk of each depot has been computed in the AHP
model, the optimization model can be solved. The
optimization model is a mixed integer programming
problem. In order to solve the model, the optimal software
CPLEX11.0 was used. According to the data provided by
shipping liner, we can get different solution of the model.
The solutions can be illustrated in table 2. It should be noted
that in table 2, different solution has different weights of
environmental factors.

depot exhaust noise traffic accident ecology total

1 0.426 0.373 0.426 1 0.373 0.465
2 0.235 0.373 0.426 0.235 0.115 0.283
3 1 1 1 1 1 1
4 1 1 1 1 1 1
5 1 1 1 1 1 1
6 0.426 0.373 0.235 0.235 0.373 0.322
7 1 1 1 1 1 1
8 1 1 1 1 1 1
9 0.426 0.373 0.426 1 0.373 0.465
10 0.426 0.373 0.426 1 0.373 0.465
11 0.426 0.373 0.235 1 0.373 0.432
12 1 1 1 1 1 1
13 0.426 0.373 0.426 1 0.373 0.465
14 0.426 0.373 0.235 0.426 0.373 0.353
15 0.426 0.373 0.426 0.235 0.373 0.342
16 0.426 0.373 0.426 0.426 0.373 0.368
17 1 1 1 1 1 1
18 0.426 0.373 0.235 0.426 0.373 0.353
19 0.426 0.373 0.426 0.426 0.373 0.368
20 0.426 0.373 0.235 0.235 0.373 0.322

Table2. Transportation Cost of Different Solutions

2014 26th Chinese Control and Decision Conference (CCDC) 3241

 Distribution and Logistics Management, 42(1), 36–59 (2012)
[7] Jayajit Chakraborty, Evaluating the environmental justice
Depot H1 H2 H3 impacts of transportation improvement projects in the US.
1 0.465 0.382 0.382 Transportation Research Part D: Transport and Environment,
2 0.283 0.257 0.257 11(5), 315-323(2006)
3 1 1 1 [8] Mitchell J. Lavine, Arnim H. Meyburg, Thomas J. Butler, Use
of energy analysis for assessing environmental impacts due to
4 1 0.496 0.496
transportation. Transportation Research Part A: General,
5 1 1 1 16(1),35-42,1982
6 0.322 1 1 [9] Mirjan E. Bouwman, Henri C. Moll, Environmental analyses
7 1 1 1 of land transportation systems in The Netherlands. Transportation
8 1 0.352 0.352 Research Part D: Transport and Environment, 7(5),
9 0.465 0.465 0.465 331-345(2002)
10 0.465 0.496 0.496 [8] Quang-Vinh Dang, Won-Young Yun, Herbert Kopfer,
Positioning empty containers under dependent demand process,
11 0.432 0.257 0.257
Computers & Industrial Engineering, 62(3), 708-715(2012)
12 1 1 1
[10]Jing-Xin Dong, Dong-Ping Song Container fleet sizing and
13 0.465 0.465 0.465 empty repositioning in liner shipping systems, Transportation
14 0.353 0.323 0.323 Research Part E: Logistics and Transportation Review, 45(6),
15 0.342 0.342 0.342 860-877(2009)
16 1 1 1 [11]Fedele Iannone, The private and social cost efficiency of port
17 1 1 1 hinterland container distribution through a regional logistics
18 0.353 0.323 0.323 system, Transportation Research Part A: Policy and Practice,
46(9), 1424-1448(2012)
19 0.368 0.465 0.465
20 0.322 0.257 0.257
cost 6,823,325 7,223,689 6,561,922

4 CONCLUSIONS
Container depot is an important facility in container
transportation network. The optimization of location of
depots can definitely reduce the reposition cost of
containers, so shipping lines always spare no effort to
choose most suitable depot in the container transportation
network. The paper proposes a new way to optimize the
location of container depots. In the model the
environmental effect of operation of container depots is
included, which allows the shipper liners to locate the depot
with environmental constraints, instead of only taking cost
into count when making location decision.
REFFERENCE
[1] Chien-Chang Chou, Rong-Hua Gou, Chaur-Luh Tsai,
Ming-Cheng Tsou, Chun-Pong Wong, Hui-Lin Yu, Application of
a mixed fuzzy decision making and optimization programming
model to the empty container allocation. Applied Soft
Computing,10(4), 1071-1079(2010)
[2]Bernard Gendron, Teodor Gabriel Crainic, A
branch-and-bound algorithm for depot location and container fleet
management. Location Science, 3(1), 39-53(1995)
[3] Neha Mittal, Maria Boile, Alok Baveja, Sotiris Theofanis,
Determining Optimal Inland-empty-container Depot Locations
under Stochastic Demand, Research In Transportation Economics,
42(1), 50-60( 2013)
[4] Lättilä, Ville Henttu, Olli-Pekka Hilmola, Hinterland
operations of sea ports do matter: Dry port usage effects on
transportation costs and CO2 emissions, Transportation Research
Part E: Logistics and Transportation Review,55(3), 23-42(2013)
[5] Hyuk-soo Cho, Kun-woo Yang, identifying Country
Environments to Increase Container Traffic Volumes, the Asian
Journal of Shipping and Logistics, 27(1), 157-185(2011)
[6] Eng-Larsson, F., & Kohn, C, Modal shift for greener logistics
— The shipper's Perspective, international Journal of Physical

3242 2014 26th Chinese Control and Decision Conference (CCDC)