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Low carbon logistics: Reducing shipment frequency to cut carbon emissions

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  • Tang, Shaolong
  • Wang, Wenjie
  • Yan, Hong
  • Hao, Gang

Abstract

This study examines the issue of cutting emissions by reducing shipment frequency within the framework of periodic inventory review system, which is one of the most popular inventory control systems in practice. We first formulate a benchmark model to represent the Business-As-Usual scenario then further develop this model into a carbon emission reduction model by adding a constraint that represents the emission reduction percentage target. Because of the non-convexity of general models, we simplify our two general models into special cases and develop their propositions analytically. We then conduct comprehensive numerical experiments on the general models. Our findings suggest that by reducing shipment frequency and adjusting inventory control decisions in a periodic review system, a firm could meet a moderate emission reduction target with limited impact on total cost. Our results also show that cost associated with emission reduction is related to unit backorder cost and leadtime, while the common belief that a higher unit holding cost would lead to higher cost for emission reduction is not supported. To the best of our knowledge, no prior research has yet addressed carbon reduction considerations within the framework of periodic review inventory systems. This study provides insights in understanding in what ways the adjustment of inventory control decisions could lead to reducing carbon emissions in logistics.

Suggested Citation

  • Tang, Shaolong & Wang, Wenjie & Yan, Hong & Hao, Gang, 2015. "Low carbon logistics: Reducing shipment frequency to cut carbon emissions," International Journal of Production Economics, Elsevier, vol. 164(C), pages 339-350.
    • Handle: RePEc:eee:proeco:v:164:y:2015:i:c:p:339-350
    DOI: 10.1016/j.ijpe.2014.12.008
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    8. Kumar, Anil & Luthra, Sunil & Mangla, Sachin Kumar & Garza-Reyes, Jose Arturo & Kazancoglu, Yigit, 2023. "Analysing the adoption barriers of low-carbon operations: A step forward for achieving net-zero emissions," Resources Policy, Elsevier, vol. 80(C).
    9. Yong Ye & Jing Wang, 2017. "Study of logistics network optimization model considering carbon emissions," International Journal of System Assurance Engineering and Management, Springer;The Society for Reliability, Engineering Quality and Operations Management (SREQOM),India, and Division of Operation and Maintenance, Lulea University of Technology, Sweden, vol. 8(2), pages 1102-1108, November.
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    12. Zhaojun Yang & Xiaoting Guo & Jun Sun & Yali Zhang, 2021. "Contextual and organizational factors in sustainable supply chain decision making: grey relational analysis and interpretative structural modeling," Environment, Development and Sustainability: A Multidisciplinary Approach to the Theory and Practice of Sustainable Development, Springer, vol. 23(8), pages 12056-12076, August.
    13. Biswajit Sarkar & Sharmila Saren & Mitali Sarkar & Yong Won Seo, 2016. "A Stackelberg Game Approach in an Integrated Inventory Model with Carbon-Emission and Setup Cost Reduction," Sustainability, MDPI, vol. 8(12), pages 1-23, December.
    14. Xing, Hui & Spence, Stephen & Chen, Hua, 2020. "A comprehensive review on countermeasures for CO2 emissions from ships," Renewable and Sustainable Energy Reviews, Elsevier, vol. 134(C).
    15. Ata Allah Taleizadeh & Leila Aliabadi & Park Thaichon, 2022. "A sustainable inventory system with price-sensitive demand and carbon emissions under partial trade credit and partial backordering," Operational Research, Springer, vol. 22(4), pages 4471-4516, September.
    16. M. Turkensteen (Marcel) & van den Heuvel, W., 2019. "The trade-off between costs and carbon emissions from lot-sizing decisions," Econometric Institute Research Papers EI2019-19, Erasmus University Rotterdam, Erasmus School of Economics (ESE), Econometric Institute.
    17. Shiqing Zhang & Jianwei Wang & Wenlong Zheng, 2018. "Decomposition Analysis of Energy-Related CO 2 Emissions and Decoupling Status in China’s Logistics Industry," Sustainability, MDPI, vol. 10(5), pages 1-21, April.
    18. Umakanta Mishra & Jei-Zheng Wu & Anthony Shun Fung Chiu, 2019. "Effects of Carbon-Emission and Setup Cost Reduction in a Sustainable Electrical Energy Supply Chain Inventory System," Energies, MDPI, vol. 12(7), pages 1-18, March.
    19. Xin Yao & Yuanyuan Cheng & Li Zhou & Malin Song, 2022. "Green efficiency performance analysis of the logistics industry in China: based on a kind of machine learning methods," Annals of Operations Research, Springer, vol. 308(1), pages 727-752, January.
    20. Guangsheng Zhang & Xiao Wang & Yu Zhang & Jiayun Kang, 2022. "Research on the Emission Reduction Decision of Cost-Sharing Logistics Service Supply Chain in the O2O Model," Sustainability, MDPI, vol. 14(20), pages 1-21, October.
    21. Shib Sankar Sana, 2022. "A structural mathematical model on two echelon supply chain system," Annals of Operations Research, Springer, vol. 315(2), pages 1997-2025, August.
    22. Pengfei Zhao & Lingxiang Wei & Dong Pan & Jincheng Yang & Yuchuan Ji, 2023. "Analysis of Key Factors Affecting Low-Carbon Travel Behaviors of Urban Residents in Developing Countries: A Case Study in Zhenjiang, China," Sustainability, MDPI, vol. 15(6), pages 1-16, March.

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