Cost-efficiency of intermodal container supply chain for forest chips

Abstract

Karttunen K., Lättilä L., Korpinen O.-J., Ranta T. (2013). Cost-efficiency of intermodal container supply chain for forest chips. Silva Fennica vol. 47 no. 4 article id 1047. 24 p. Highlights• The combined availability and simulation study method obtains more realistic results for use in practical decision-making in supply chain management.• The total costs of forest chips with intermodal composite container supply chains were lower than traditional options in all scenarios.• The most advantageous way to expand the procurement area for forest chips is either to use composite container trucks or start using train transportation instead of trucks for procurement from longer distances. AbstractCost-efficient solutions of supply chains for energy wood are required as part of endeavors to reach targets for renewable energy utilization. Long-distance railway transportation is an interesting area of research, especially for high-volume sites where the forest-to-site distance is considerable and rail facilities already exist. The aim of the study was to compare the cost-efficiency of an intermodal container supply chain and traditional multi-modal supply chain with corresponding direct truck logistics for long-distance transportation of forest chips. In the study, site-dependent information for forest biomass transport was integrated into a simulation model to calculate the cost-efficiency of logistic operations related to forest chips transportation in central Finland. The model was tested with several truck and railway transportation scenarios for varying demand of forest chips at the case power plant. The total costs of traditional supply chains were found to be 5-19% more expensive than container supply chain scenarios. The total unit costs of forest chips varied between 15.3 and 20.0 €/MWh depending on the scenario. It is concluded on the basis of the scenario study that intermodal light-structure container logistics and railway transportation could be developed as a viable option for large-scale supply of forest chips.

Developing forest chips supply chains by redesigning supply operations and logistics

“…Asikainen 1995, Asikainen 2001, Asikainen 2010, Karttunen et al 2013, Belbo and Talbot 2014, Eriksson et al 2014a, Eriksson et al 2014b, DES was found to fit well in the modelling of selected forest chips supply chain including "hot chain" features and the specific characteristics of the supply environment with high heterogeneity of feedstock properties as an example. All articles (I-IV) incorporated machine or sub-system interactions with the tendency of increased idle time of machines and vehicles during the imbalance of system components.…”

“…The dynamic simulation model can reliably describe the behaviour of such systems as the supply of forest chips represents. As discovered in several DES studies of forest chip supply, machine or sub-system interactions can cause substantial idling times for the machines (Asikainen 1995, Asikainen 2001, Asikainen 2010, Karttunen et al 2013, Belbo & Talbot 2014, Eriksson et al 2014a, Eriksson et al 2014b). According to Asikainen (2010), if using a deterministic and static study approach instead of dynamic ones as DES is in the forest chip supply chain of a chipper and chip trucks, there is a tendency to significantly overestimate system performance and underestimate waiting times and supply.…”

“…Also, Zamora-Cristales et al (2013) applied DES for analysing the cost-efficiency of forest chip supply by mobile chipper and chip trucks. Karttunen et al (2013) introduced a combination of agent-based modelling and DES for constructing the simulation model, which was utilized for comparing the cost-efficiency of an intermodal container supply chain and a traditional multi-modal supply chain with corresponding direct truck logistics for long-distance transportation of forest chips by road and rail. Belbo & Talbot (2014) compared the supply of small trees from landing to plant or terminal by varying the transportation of biomass as loose, as chipped and as baled.…”

“…Andersson et al (2002), Hakkila (2004), Ranta et al (2012), , Enström et al (2013), Karttunen et al (2013), Kons et al (2014), Virkkunen et al(2015), Anerud et al (2016), and Gautam et al (2017) have stated other factors, which support the introduction of terminals to the fuel supply.…”

“…Moreover, the need and the costs of road maintenance of secondary and tertiary roads could be reduced, if some of the forest fuel could be delivered to terminals during the time of good road connections (Anerud et al 2016, Gautam et al 2017. When the procurement volumes are large and transport distances long, terminals are essential for the efficient supply operations for fuel consumption facilities and where different transport modes are connected , Karttunen et al 2013, Enström et al 2013) introduced the concept of rescaling the supply fleet; with less resources (machines, vehicles, workforce) it is possible to achieve the same desired output with a terminal than a supply chain without one. This is because terminals enable balancing the utilization of the supply fleet over the year.…”