Lecture-Capacity-Investment-Planning-Deterministic-Model

Lecture-Capacity-Investment-Planning-Deterministic-Model -...

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1 CAPACITY INVESTMENT CAPACITY INVESTMENT PLANNING PLANNING  MODEL  MODEL CHE 5480- Spring 2003 CHE 5480- Spring 2003 University of Oklahoma University of Oklahoma School of Chemical Engineering and Materials Science School of Chemical Engineering and Materials Science Prof. M. Bagajewicz Prof. M. Bagajewicz
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2 Process Planning Under Uncertainty Process Planning Under Uncertainty OBJECTIVES OBJECTIVES : : Maximize Net Present Value Maximize Net Present Value Production Levels Production Levels DETERMINE DETERMINE : : Network Expansions Network Expansions Timing Timing Sizing Sizing Location Location GIVEN: GIVEN: Process Network Set of Processes Set of Processes Set of Chemicals Set of Chemicals A 1 C 2 D 3 B Forecasted Data Forecasted Data Demands & Availabilities Demands & Availabilities Costs & Prices Costs & Prices Capital Budget Capital Budget
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3 Capacity Investment  Planning Capacity Investment  Planning Design Variables: Design Variables: to be decided before the uncertainty reveals to be decided before the uncertainty reveals { } x = E it Y it , , Q it Y: Decision of building process Y: Decision of building process i in period in period t E: Capacity expansion of process Capacity expansion of process i in period t Q: Total capacity of process i in period t Control Variables: Control Variables: selected after uncertain parameters become known. selected after uncertain parameters become known. Assume them known for the time being!!!! Assume them known for the time being!!!! S: S: Sales of product Sales of product j in market in market l at time at time t and scenario and scenario s P: P: Purchase of raw mat.
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