An Approach for Integrating Valuable Flexibility During Conceptual Design of Networks

Abstract

Energy and industrial networks such as pipeline-based carbon capture and storage infrastructures and (bio)gas infrastructures are designed and developed in the presence of major uncertainties. Conventional design methods are based on deterministic forecasts of most likely scenarios and produce networks that are optimal under those scenarios. However, future design requirements and operational environments are uncertain and networks designed based on deterministic forecasts provide sub-optimal performance. This study introduces a method based on the flexible design approach and the concept of real options to deal with uncertainties during conceptual design of networks. The proposed method uses a graph theoretical network model and Monte Carlo simulations to explore candidate designs, and identify and integrate flexibility enablers to pro-actively deal with uncertainties. Applying the method on a hypothetical network, it is found that integrating flexibility enablers (real options) such as redundant capacity and length can help to enhance the long term performance of networks. When compared to deterministic rigid designs, the flexible design enables cost effective expansions as uncertainty unfolds in the future.

The design of a flexible bus line plan

“…Through this approach, engineering systems are designed with sufficient flexibility to minimize the negative effects of nonconsidered situations. This approach has been tested in several case studies such as: parking-size decisions (Zhao and Tseng, 2003), crash avoidance systems (de Neufville, 2008), oilfields (Lin, 2013 or pipeline-based networks (Melese et al, 2017). This is a long-term strategy, while the operation of our alternative lines is decided during operations.…”

Multimodal Transportation Flows in Energy Networks with an Application to Crude Oil Markets

“…Multimodal flow analyses are critical to characterizing and solving problems within today's energy networks. The movement of fuels between nodes and across various levels within these networks involves multiple decisions under uncertainty and constraints of capacity, regulation and environmental impact limitation (Melese et al, 2016). As urgent steps are being taken to tackle climate change and related effects, greater efforts must be made to capture salient properties of various modes of energy transfer in order to provide reliable frameworks for best policy implementations (Heijnen et al, 2014).…”