Optimal Machine Maintenance and Replacement by Linear Programming

The authors would like to express their gratitude to Eastern Gas and Fuel Associates for having provided test data and computer time. The model of this paper grew out of a related model previously developed at Eastern Gas and Fuel. The problem of an optimal strategy of machine maintenance and replacement over an infinite horizon is formulated as a linear programming problem. Computational experience on real data is given including sensitivity of the LP solution to the maximum life of the machine and to various parameters of the model includ-ing discount factor, the method of computing depreciation, effect of rebuilding, maintenance and rebuild costs