Green Supply Chain Network Design

This thesis presents an analysis of Elhedhli and Merrick\u27s paper, Green supply chain network design to reduce carbon emissions. Elhedhli and Merrick proposed a supply chain model to find the optimal placement of distribution centres (DCs) while minimizing transportation costs, the fixed cost of opening the DC and carbon emissions costs.They found that considering carbon emissions creates a pull to reduce the vehicle kilometers travelled, and results in a supply chain network with more DCs opened compared to a supply chain network that does not consider carbon emissions.This thesis is an exploration of the model and solution methods proposed by Elhedhli and Merrick. An overview of optimization topics, a description of Lagrangian relaxation and an outline of decomposition methods is included to provide background knowledge for the description of the green supply chain network model, and its solution methods. We use the algorithm suggested by Elhedhli and Merrick to find the optimal solution of three supply chain networks: one considering zero emissions costs, one considering moderate emissions costs and one considering high emissions costs. The results obtained from the three scenarios confirm the results of Elhedhli and Merrick