A framework and risk analysis for supply chain emission trading

Li, Fang; Schwarz, Lydia; Haasis, Hans–Dietrich

doi:10.1007/s12159-016-0135-x

Cited by 6 publications

(2 citation statements)

References 21 publications

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“…On the other hand, some studies discussed the risks of introducing ETS and the factors that hinder the cost-effectiveness of ETS. Reference [28] classified risks (market risk, policy risk, green investment risk, etc.) from the supply chain perspective when implementing ETS and derived a strategic portfolio for risk mitigation.…”

Section: Emission Trading Scheme (Ets)mentioning

confidence: 99%

Optimal Operational Strategy for Power Producers in Korea Considering Renewable Portfolio Standards and Emissions Trading Schemes

2019

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Globally, many countries are experiencing economic growth while concurrently increasing their energy consumption. Several have begun to consider a low-carbon energy mix to mitigate the environmental impacts caused by increased fossil fuel consumption. In terms of maximizing profits, however, power producers are not sufficiently motivated to expand capacity due to high costs. Thus, the Korean government initiated the Renewable Portfolio Standard (RPS), an obligation to generate a certain proportion of a producer's total generation using renewable energy for power producers with capacities of 500 MW or more, and the Emissions Trading Scheme (ETS), designed to attain a carbon emissions reduction goal. We propose a mathematical model to derive the optimal operational strategy for maximizing power producer profits with a capacity expansion plan that meets both regulations. As such, the main purpose of this study was to obtain the optimal operational strategy for each obligatory power producer. To that end, we defined a 2 × 2 matrix to classify their types and to conduct scenario-based analyses to assess the impact of major factor changes on solutions for each type of power producer. Finally, for the power generation industry to operate in a sustainable and eco-friendly manner, we extracted policy implications that the Korean government could consider for each type of power producer.Energies 2019, 12, 1667 2 of 24 implemented RPS, which obligates power producers with 500 MW or more of NRE generation capacity to produce a certain percentage of the previous year's NRE generation capacity from renewable energy (RE) sources. The government aims to have more than 10% of electric power generation come from RE sources by 2023.At the 21st Conference of Parties, Korea, whose GHG emissions were 7th among Organization for Economic Co-operation and Development (OECD) countries in 2016, declared a national reduction target of 37% compared to business as usual (BAU) by 2030 [4]. In order to achieve this, in 2015, the government started ETS, which assigns companies Carbon Emissions Reductions (CER) based on annual and sectoral GHG reduction targets. Each company complies with this regulation by buying CER surplus, selling CER shortage, or paying penalties for excess emissions.Korea's major producers in the power generation industry, which accounts for more than one-third of national GHG emissions [7], must follow both regulations. RPS and ETS act as means to implement international commitments, from a national viewpoint, and to create a new paradigm that can affect operations, from an enterprise perspective. Therefore, obligatory power producers (hereafter, power producers) should be aware of the mechanisms of both regulations. They should also provide a stable power supply and establish an efficient future operational strategy.Korea's power industry is moving towards increasing the private-sector share from the nation-led sector. Thus, from a corporate management perspective, RPS and ETS will affect revenues and costs. Most previous...

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Section: Emission Trading Scheme (Ets)mentioning

confidence: 99%

Optimal Operational Strategy for Power Producers in Korea Considering Renewable Portfolio Standards and Emissions Trading Schemes

2019

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“…There is voluminous literature devoted to analyzing the way company's performance is affected by general problems and effects of carbon dioxide emission reduction through the whole chain (Jones, 2005;Martinuzzi, 2011;Kahn, 2014;Congcong, 2016;Li, 2016;Seebauer et al, 2016;Bazan, 2017, Clune, 2017, as well as consumer preferences (Ji, 2017). In other words, it is generally known that carbon dioxide reduction increases the economic performance of companies (Cusshiella, 2017), the profitability of producers and retailers, as well as consumer preferences (Eagle, 2017).…”

Section: Introductionmentioning

confidence: 99%

Emission of carbon dioxide of selected retailers

Lukić¹

2017

Int Rev

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Increased attention has been paid recently to the analysis of the effects of applying the concept of sustainable development in retail. In that context we have particularly considered greenhouse gases emission in retail. This is achieved through the use of modern ecological technology in businessthrough the whole value chain. The ultimate goal is to achieve the planned reductions of carbon dioxide in retail, which positively reflects the overall performance of retailers, environmental in particular. The costs of carbon dioxide emission reduction affect the performance of retailers. Continuous empirical research shows that almost all global retailers achieve a significant reduction in carbon dioxide emissions from year to year. Empirical research conducted in this paper on the example of global retailers in the United States, Europe and the European Union, the United Kingdom, Mexico, China, Croatia and Serbia shows significant and planned reduction of carbon dioxide emissions in retail, especially in countries with developed market economies. This empirical research is mainly based on the analysis of the original sustainable (environmental and ecological) reports officially disclosed by selected retailers, primarily from the countries of a developed market economies, which they started to publish with regular annual financial statements. They are now an integral part of the so-called integrated reporting on performance of global retailers. Due to the general importance, harmonized regulations on sustainable retail reporting are being increasingly applied as a data source for more efficient environmental management. In perspective, this will ease the comparative analysis of the carbon dioxide emission of global and other retailers.

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A Three-Layer Imperfect Production Supply Chain Model with Green Investment Under Trade Credit and Cap-Trade Policy

Narang

Kumari

2023

J. Ind. Intg. Mgmt.

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A three-layer supply chain model with a single supplier, manufacturer, and retailer is presented in this paper. This proposed model is analyzed under green investment along with trade credit and cap-trade policy. It is considered that the manufacturer’s production process is imperfect. Few inferior quality products are reworked, and the remaining defective items are discarded. The manufacturer makes investments in green technology to reduce carbon emissions. The product’s demand is influenced by selling price, advertisement, and green-technology level. The total average profit of the supply chain is constructed under three different scenarios of trade credit provided by the manufacturer to the retailer. The primary goal of this research is to obtain the optimal selling price, production rate, and green-technology level to maximize the system’s total average profit by using genetic algorithm. A numerical example is shown to demonstrate the model, and sensitivity analysis is carried out to analyze the impact of numerous input parameters. Managerial insights and conclusions are provided to make this model helpful for manufacturers.

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A framework and risk analysis for supply chain emission trading

Cited by 6 publications

References 21 publications

Optimal Operational Strategy for Power Producers in Korea Considering Renewable Portfolio Standards and Emissions Trading Schemes

Optimal Operational Strategy for Power Producers in Korea Considering Renewable Portfolio Standards and Emissions Trading Schemes

Emission of carbon dioxide of selected retailers

A Three-Layer Imperfect Production Supply Chain Model with Green Investment Under Trade Credit and Cap-Trade Policy

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