Energy 100 (2016) 321e331

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Energy
journal homepage: www.elsevier.com/locate/energy

Biofuel supply chain design from Coffee Cut Stem under

environmental analysis
Alexandra Duarte a, William Sarache b, *, Yasel Costa c, d
a
Universidad de Caldas, Colombia
b
Universidad Nacional de Colombia, Colombia
c
University of Applied Sciences Upper Austria, Austria
d
Universidad de Manizales, Colombia

a r t i c l e i n f o a b s t r a c t

Article history: The fossil fuel consumption is still a global concern that has received great deal of attention from
Received 23 February 2015 Chemical Engineering and Operation Research fields. In this sense, this paper presents a SCND (Supply
Received in revised form Chain Network Design) for second-generation biofuel production. For this aim, we proposed a mathe-
22 January 2016
matical model that includes, simultaneously, economic and environmental issues. The model feasibility
Accepted 25 January 2016
Available online 23 February 2016
has been tested in Colombia. In this case study, the bioethanol production from Coffee Cut Stem (Coffee-
CS) is examined considering the three main echelons of the supply chain. Experimental results showed
that Coffee-CS is a profitable and sustainable feedstock for biofuel production.
Keywords:
Biofuel production
© 2016 Elsevier Ltd. All rights reserved.
Supply chain optimization
Coffee Cut Stem
GHG emissions

1. Introduction Colombia that uses an agricultural residue known as Coffee-CSs

Biofuel production through second-generation technology has
received great deal of attention in recent literature [1]. Firstly, this
product has become in one of the most suitable energy source for
transportation system [2]. At the same time, second-generation tech-
nology does not interfere with land utilization [3] and food security [4].
A vast contribution about biofuel supply chain design using
second-generation technology can be found in the literature. For
instance, the feasibility of bioethanol production in Turkey is
examined by Ref. [5]. Also in Refs. [6], the second-generation bio-
ethanol production is studied. Here the authors propose the opti-
mization of corn stover biorefinery using SSF (Simultaneous
Saccharification and Fermentation) of pretreated solids. Another
optimization proposal is reported in Ref. [7]. This contribution
combines the process design and SCND (Supply Chain Network
Design) using an MILP (Mixed-Integer Linear Programming)
formulation. The model was applied to locate a bioethanol plant in
* Corresponding author. Departamento de Ingeniería Industrial, Universidad,
Nacional de Colombia, Cra. 27 No. 64-60, Manizales, Colombia. Tel./fax: þ57 68
879300x55782.
E-mail addresses: aeduartec@gmail.com (A. Duarte), wasarachec@unal.edu.co
(W. Sarache), yasel.costa@fh-steyr.at (Y. Costa).
(Coffee Cut Stems). Moreover, the biorefinery location and tech-
nology selection under SCND scheme is suggested by Ref. [8]. The
authors contribute with a detailed financial analysis into the model
formulation, including capital depreciation and taxation. The MILP
is also utilized in the mathematical formulation proposed by Ref.
[9]. However, the authors incorporate the multimodal transport
into the cellulosic Biofuel SCND under feedstock seasonality.
In spite of the formidable contributions to this field, the eco-
nomic issue seems to be the frequent goal within the SCND.
However, the global warming, created by large-scale emissions of
GHG (Green House Gasses) [10], is a top environmental and social
concerns [11].
Logistic operations (sourcing, transportation, production, stor-
age and consumption) imply several ecological impacts over air,
land and water [12]. Therefore, new research trends aim to achieve
a proper trade-off between the SC (supply chain) profitability and
environmental sustainability [2]. In this sense, a comprehensive
literature review of sustainable facility location decision-making
can be found in Ref. [13]. Furthermore, a good example of the
aforementioned research trend is illustrated in Ref. [14]. The
contribution shows the simultaneous benefits (total cost and car-
bon emission reduction) of implementing some green strategies for
systematic design of waste-to-energy supply chain.

http://dx.doi.org/10.1016/j.energy.2016.01.076
0360-5442/© 2016 Elsevier Ltd. All rights reserved.
322 A. Duarte et al. / Energy 100 (2016) 321e331
To the author's knowledge, CF and WF (carbon and water foot-
print) have been recognized as the key issues in renewable fuels
production. In particular, controlling for carbon emissions and
measuring the CF [15] across the SC is considered a challenge for
organizations [16].
A brief review of literature (see Table 1), regarding Biofuel SCND
under GHG emissions reduction indicates that optimization tech-
niques (MCDM (Multi-criteria decision making) and mathematical
models) are often applied to support decision makers. Other solu-
tion approaches mainly consist of fuzzy models that maximize the
overall level of satisfaction considering both environmental and
economic criteria.
In general, the optimization models have a long tradition in
Biofuel SCND [11]. They are able to link many echelons along the SC,
considering mass balance, plant and source capacity, technology
assignment, financial regulations and demand fulfillment. Envi-
ronmental concerns, is still a recent topic to be included in the
decision-making. Table 2 summarizes some of the relevant con-
tributions where several case studies about Biofuel SCND have been
addressed with especial emphasis in CF analysis.
After see the information in Table 2, one can realize that Biofuel
SCND has been applied using first and second-generation technol-
ogies. Corn and its residuals (stover) are the most common feed-
stock for first and second-generation alternatives, respectively.
Simultaneous optimization of economic and environmental func-
tions is analyzed in all contributions; however, transportation and
biomass processing, have received the major attention within the
environmental modeling. Moreover, besides the classical logistic
operations constraints (mass balance from providers to customers),
GHG emissions balance is constrained from the LCA (Life Cycle
Analysis) approach. Through mixed integer programming (binary
and continuous variables) authors model the trade-off situations in
Biofuel SCND.
This paper proposes an extended version of the model reported
by Duarte et al. [7]. In the present contribution, we study an
expanded structure of Bioethanol SCND including new feedstock
sources and others feasible plant location alternatives. An impor-
tant new feature of our proposal is the environmental analysis
based on GHG emission for biofuel production from Coffee Cut
Stem (Coffee-CS). Furthermore, we include the following particular
model characteristics:
▪ The SCND considers other inputs sourcing in the upstream
echelon. Here, there is a competition for biomass availability
between biofuel production and other supply chains. In the
midstream, byproducts can be obtained after conversion
processes.
▪ The penalty cost associated with unfulfilled demand is
computed according to a proposed decision rule.
▪ The biofuel production from Coffee-CS under economic and
environmental optimization over multi-period analysis.
Table 1
Summary of research approach for Biofuel SCND including CF analysis.
Theoretical Multi-criteria decision Mathematical
analysis making model
(MCDM)
[11] [2] [17]
[23] [20] [19]
[16] [21]
[28] [22]
[4]
[14]
▪ The multi-period supply chain optimization for biofuel pro-
duction from Coffee-CS. To our knowledge, this mathematical
formulation has not been considered in previous proposals.
▪ The sensitivity analysis considering the effects of CO2 price
variation on the economic benefit, demand fulfillment and
environmental performance.
The paper is structured as follows. Section 2 presents the
Biofuel-SCND and its assumptions for decision-making. Later, the
proposed mathematical formulation is described in Section 3.
Experimental results of the examined case study are detailed in
Section 4. The Section 5 highlighted the main remarks based on the
obtained results. Finally, the research conclusion and future
research tasks are depicted in Section 6.
2. The proposed Biofuel-SCND and its assumptions
The goal of the proposed Biofuel-SCND implies three funda-
mental aspects concerning to: economical incomes, supply chain
cost (operational and fixed) and the total ecological balance (green
credits vs impact) in the biofuel production network. The afore-
mentioned elements have been integrated in the so-called profit-
ability function. The proposed model is a general optimization
framework under the following assumptions:
▪ Bioethanol or biodiesel can be the final product.
▪ First and second-generation technologies can be utilized.
▪ A competition scenario for the feedstock utilization can be
established between the biofuel production and other supply
chains (furniture industry, food industry, heat generation,
among others).
▪ Other incomes are considered due to the byproduct generation.
General scheme of the studied supply chain (see Fig. 1) is
illustrated considering its three main echelons. The acquisition and
transportation of feedstock (e.g. Coffee-CS and other inputs) made
up the upstream echelon. As a particular feature in the SCND, there
may be a competition for the feedstock utilization in other supply
chains (i.e. sourcing process for furniture industry). Meanwhile,
biofuel and byproducts are obtained in the midstream. Down-
stream involves blending and distribution operations, for conver-
sion process outputs, toward national demand centers (gas
stations) or international market.
The environmental issues are considered in the SCND through
the standard LCA approach. As previous researches, the determi-
nation of LCA in biofuel GHG emissions requires of conversion
factors in order to estimate the impact of global warming. Similar to
Giarola et al. [19] and Bernardi et al. [2], the set of LCA stages
involved in the CF evaluation are:
▪ Biomass acquisition. Despite of the analyzed supply chain does
not imply biomass cultivation; the negative impact of feedstock
generation is included in the SCND. Undesirable environmental
effects are primarily related with agronomic processes (fertil-
ization and pest fumigation) and land use [30].
▪ Biomass pretreatment. This stage involves warehousing and
drying processes at the conversion plant (see Ref. [31]). The
Other
ecological impact depends of the biomass type and, in a lesser
approach
degree, of the used technology.
▪ Biomass and biofuel transportation. Principally, the negative
[18]
[24] impact is caused by gas emission of vehicles, depending of
[25] transportation means and traveled distances.
[26] ▪ Biofuel production. During the conversion process, the gas
[29] emission level depends on the utilized technology and the
biomass type [32].
 A. Duarte et al. / Energy 100 (2016) 321e331 323

Table 2
Summary of optimization-based studies considering CF analysis.

Author Technology Feedstock Environmental features in the mathematical model Remarks about results
(1st and/or
Objective Constraints Decision variables
2nd)
function

[2] 1st and 2nd ▪ Corn Max: ▪ Material Continuous: biomass rate, A Bioethanol SCND is studied under multi-period and multi-objective
▪ Corn Financial flow financial and environmental approaches. The GHG emission and WF are analyzed in a real SC case
stover performance ▪ GHG life performance study of Northern Italy
Min: GHG cycle Binary: facility location and
emission ▪ Water technology selection
Min: Water footprint
consumption
[17] 1st ▪ Corn Max: SC total ▪ Mass Binary: taxation and nitrogen Authors illustrate how the SC profit and total environmental impact
profits balance dosage application perform simultaneously better. The model application to Northern
Min: GHG ▪ LCA Italian case study showed that the GHG emission savings can reach the
emission 80%
[19] 1st and 2nd ▪ Corn, Max: Net ▪ Biomass Binary: taxation, facility The Northern Italian Bioethanol infrastructure is analyzed considering
Poplar Present balance establishment and technology stochastic scenarios (based on European threshold levels for GHG
▪ Willow Value ▪ Technology assignment emission)
Others assignment
▪ CO2
emission
[20] 1st ▪ Corn Max: Net ▪ Material Continuous: biomass rate, The authors include many technological possibilities to produce
Present balance plant capacity and material bioethanol in the context of SCND. Solution approach is based on Pareto
Value ▪ Technology flows front under the consideration of emission credits
Min: GHG selection Binary: technology
emission ▪ Carbon assignment and facility
trading location
scheme
[22] 1st ▪ Oil palm Min: SC total ▪ Material Continuous: flow rate The research presents a Biodiesel SCND based on the oil palm crop
▪ Crop cost flow Binary: plant capacity availability in Colombia. Authors conclude that biodiesel based industry
Min: balance assignment must be addressed toward other feedstock
Emission
Criteria
[27] 1st ▪ Corn Min: Total CF ▪ Material Continuous: ecological benefits Authors introduce a huge amount of possibilities in the model: multiple-
▪ Cassava flow and damage at each SC stage feedstock, multiple transportation modes, multiple alternative
▪ Wheat balance technologies, multiple transport patterns and waste disposal manners in
the Bioethanol SC
[12] 1st and 2nd ▪ Corn Max: SC total ▪ SC total FP Continuous: biomass rate, The model was applied within a regional biomass and bioenergy supply
▪ Wood profits plant capacity and material chain. Biomass energy compared to conventional energy requires much
chips Min: Total CF flows more water, transport, chemicals, cause pollution to water, and it
▪ Solid Binary: technology requires also large land areas
waste assignment and facility
▪ Others location
[4] 2nd ▪ Sludge Min: SC total ▪ SC carbon Continuous: biomass rate, The model allows to understand the impacts that potential carbon
cost impact plant capacity and material regulatory policies such as carbon cap, carbon tax, carbon cap- and-trade,
flows and carbon offset mechanism will have on supply chain designs and
Binary: technology operation decisions
assignment and facility
location
[14] 2nd ▪ Palm Max: SC total ▪ SC carbon Continuous: biomass rate, The optimization results show that roadway system is more efficient and
▪ By- profits emission plant capacity and material the introduction of Energy Pack is able to contribute significantly to the
products flows amount of power generated in existing power plants
▪ Ind- Binary: technology
wastes assignment and facility
location
[16] 1st and 2nd ▪ Corn Max: SC total ▪ SC total FP Continuous: biomass rate, The dimensionality reduction method is applied during a demonstration
▪ Corn profits plant capacity and material case study of regional supply chain regarding the evaluations of different
stover Min: Total CF flows total environmental footprints. The obtained solutions exhibit higher
▪ Wood Binary: technology profits but also rather good environmental indicators
chips assignment and facility
▪ Others location

▪ Emission credits. In the proposed SCND, some benefits can be
obtained when the feedstock is sent to other supply chains,
which are dedicated to different purposes.
The design problem for the studied Biofuel-SCND includes the
following inputs:
▪ Geographical location and source availability of feedstock
suppliers;
▪ Biomass acquisition cost;
▪ Transport logistics (fleet capacity, cost, distances);
▪ Plant capacity and economical parameters (fixed and opera-
tional costs) according to geographical regions;
▪ Biofuel demand over the multiple time periods for national and
international markets;
▪ Biofuel selling prices for national and international destination;
▪ CF selling prices;
▪ Environmental burdens (biomass acquisition, conversion pro-
cess and transport).
324 A. Duarte et al. / Energy 100 (2016) 321e331

Fig. 1. General scheme for the proposed supply chain.

The main issue in our SCDN consists of the facility location for
conversion plants addressed to guarantee the maximum possible MaxðBenefitÞ ¼ Revenue  Cost (1)
material flow through supply chain echelons. In this sense, the key
decision variables to be optimized are: where the revenues in the supply chain, involving economic and
ecological incomes, are formulated by:
▪ Material flow rate (biomass and other inputs) from suppliers to
conversion plant(s) and other supply chains; Revenue ¼ economic incomes þ ecological credits (2)
▪ Biofuel conversion plant location;
▪ Biofuel and byproducts flow rate toward national and interna- The EI (economic incomes) are represented by the biofuel sale-
tional market; level obtained in both national and international markets (see
▪ Economic and environmental performance of the supply chain Equation (3)).
over the planned horizon. 2
X X X X X
EI ¼ 4 PVXPit *XPiazt;1 þ
The proposed design is set to vary along different time periods
(10-years' time horizon). Due to the strategic impact of the key ct2T c i2I ca2p c z 2Z c i 2I
X X X
variables, the Biofuel SCND will include a sensitivity analysis of  PVXebit *Xebiat þ PVXcopiat *Xprodiazt;2
some parameter disturbances over the time horizon. ca2p c i 2I ca2p
3
X
3. Mathematical formulation þ PVXnmpjt *Xnmpjt 5
cj2J
The modeling framework has been developed as a multi-period (3)
MILP problem. Following the echelon relation depicted in Fig. 1, we
present in Table 3 the decision variables and input parameters. In Positive impacts of EC (ecological credits) are expressed in the
turn, Table 4 shows the variable domain according to all sets following mathematical function:
declared in the model. Subsequently, the main components of the 2 3
mathematical model are described in the further sections. X X X X
EC ¼ 4 ECco2t *IMPciaw¼1 5 (4)
ct2T c i 2I ca2p c z 2Z
3.1. Objective function
As can be seen in Equation (5), total cost is involved either by the
The goal is to maximize a global objective function in terms of logistic spends (plant location and supply chain operations) and
economic benefits and positive environmental balance. Global negative effects caused by the GHG emissions along the LCA
benefit in Biofuel SC can be determined as: (Environmental Impact Cost, EIC).
 A. Duarte et al. / Energy 100 (2016) 321e331 325

Table 3
Input parameters and decision variables.

Parameter Description Unit

PVXPit Domestic market selling-price for the final product obtained by plant i, at time t US$/t
PVXcopiat Domestic market selling-price for the byproduct produced in plant i, at time t US$/t
PVXebit International market selling-price for biofuel obtained by plant i, at time t US$/t
PVXnmpjt Selling-price of biomass from source j to other supply chains at time t US$/t
CXmpijat Biomass transportation costs from source j to conversion plant i, in region a at time t US$/t
CXinputiqat Input transportation costs from source q to conversion plant i, in region a at time t US$/t
Cfiat Fixed and variable processing cost for plant i, located in region a at time t US$/t
CXfuelit Fossil fuel selling-price (blending process) using biofuel obtained by plant i at time t US$/t
CXPiazt Distribution costs of final product from plant i, in region a to gas station z at time t US$/t
CXndzt Penalty cost for unfulfilled demand in gas station z at time t US$/t
Qmpjt Supplier capacity from biomass source j at time t. t/year
Qinputqt Supplier capacity from input source q at time t. t/year
QPit Capacity of conversion plant i at time t. t/year
Xdzt Demand of biofuel in gas station z at time t t/year
fb Emission factor for biomass kg CO2 equiv. /t
fbp Emission factor for biomass pre-treatment kg CO2 equiv. /t
fbtija Emission factor for transportation from biomass source j to plant i in region a kg CO2 equiv. /t km
fbftiaz Emission factor for transportation of final product from plant i, in region a to gas station z kg CO2 equiv. /t km
fbfp Emission factor for biofuel production kg CO2 equiv. /t
fec Credit emission factor kg CO2 equiv. /t
ECco2t CO2 price at time t US$/kg CO2 equiv.
Re Production ratio of biomass vs required inputs NA
CRw Biomass-to-biofuel conversion rate %
MRt Blending rate for biofuel and fossil fuel, at time t. %

Variables
Yi a Binary variable; 1 if a plant i is established in region a, 0 otherwise [0, 1]
XPiazt Flow rate of final product from plant i, in region a, to the gas station z, at time t t/year
Xebiat Flow rate of biofuel from plant i, in region a, to international market, at time t t/year
Xmpijat Flow rate of biomass from source j to be processed by plant i, in region a, at time t t/year
Xnmpjt Biomass flow rate from source j to other supply chains at time t t/year
Xinputiqat Input flow rate from source q, to be processed by plant i, in region a, at time t t/year
Xfueliat Fossil-fuel flow rate used for blending process in plant i, located in region a at time t t/year
Xndzt Flow rate of unfulfilled demand in gas station z at time t t/year
Xprodiawt Flow rate of final products w from plant i, in region a at time t. t/year
Xnbiat Flow rate of biofuel generated from plant i, in region a, to national market, at time t t/year
Xmbiat Flow rate of final product (after blending process) from plants i, in region a, at time t t/year
IMPbijat Impact factor for biomass growth j to conversion plant i in region a at time t kg CO2 equiv
IMPbpijat Impact factor for biomass pre-treatment j to conversion plant i in region a at time t kg CO2 equiv
IMPbtijat Impact factor for transportation from source j to plant i in region a at time t kg CO2 equiv
IMPbftiazt Impact factor for final product transportation from plant i, in region a to gas station z, at time t kg CO2 equiv
IMPbfpiawt Impact factor for biofuel production of plant i, in region a to gas station z at time t kg CO2 equiv
IMPciawt Impact of emission credits for final product w, obtained by plant i, in region a at time t kg CO2 equiv

Cost ¼ Logistic cost þ environmental impact cost (5)

2
Similar to the model proposed by Duarte et al. [7] logistics cost X X X X 
EIC ¼ 4 IMPbijat þ IMPbpijat
(see LC in Equation (6)) are integrated by biomass acquisition and
transportation, biofuel plants construction and operation ct2T ci2I cj2J ca2p
 X X
(including pretreatment), the fossil fuel acquisition for blending þ IMPbtijat *ECco2t þ IMPbfbiaw¼1t *ECco2t
process, biofuel distribution towards final markets and the penalty ci2I ca2P
due to unfulfilled demand. 3
X X X
2 þ IMPbftiazt *ECco2t 5
X X X X X X ci 2I cj 2J ca2p
LC ¼ 4 CXmpijat *Xmpijat þ
(7)
ct2T ci2I cj2J ca2p ci2I cq2q
X X X X
 CXinputiaqt *Xinputiaqt þ Cfiat *Yia þ
ca2p ci2I ca2P ci2I
X X X X Table 4
 CXPiazt *XPiazt þ CXfuelit *Xfueliat Subscript indices used in the model.
cj2J ca2p ci2I ca2P
3 Sets Description
X j2J Set of sites with biomass availability
þ CXndzt *XndZt 5 i2I Set of processing plants
c z 2Z a2P Set of facility location alternatives for processing plants
Z2Z Set of gas station locations
(6)
t2T Time periods
Finally, considering the aforementioned LCA stages, the unde- q2Q Set of other input component availability
w2W Set of final products
sirable ecological effects can be formulated by:
326 A. Duarte et al. / Energy 100 (2016) 321e331

The domain values of model continuous variables are defined as

1
follows: Xmbiat ¼ *Xfueliat þ Xnbiat ci2I; ca2P; ct2T
ð1  MRt Þ
▪ Variables Xmpijat, Xinputiqat, Xnmpjt, Xprodiawt, Xebiat, Xnbiat, (14)
Xfueliat, Xmbiat, XPiazt (ci2I, cj2J, ca2P, cq2Q, cw2W, The biofuel flow must end at the gas stations (see Equation (15)).
ct2T) are considered non-negatives; The biofuel demand parameter must be numerically reached.
▪ The term Xndzt (cz2Z; ct2T) is unconstrained. Therefore, the aim of the term Xndzt is to insert slack or surplus
between offer and demand in order to preserve the model feasi-
bility (Equation (16)).

3.2. Model constraints X

XPiazt ¼ Xmbiat ci2I; ca2P; ct2T (15)
czεZ
The model constraints are presented from Equations (8)e(27).
In general, these mathematical expressions guarantee two main X X
aspects: first, the adequate materials flow through the biofuel XPiazt þ Xndzt ¼ Xdzt cz2Z; ct2T (16)
supply chain (Equations (8)e(21)); and second, the impact of the i2I ca2p
GHG emissions according to the LCA approach (Equations
Similar to the proposed model in Refs. [7], the Big-M constraints
(22)e(27)).
(from Equation (17) and (21)) are included in order to avoid
Equation (8) ensures that the required feedstock cannot over-
nonlinearity. The parameter M has been set using a huge value.
come the sourcing capacity.
X X X X Xmpijat  M*Yia ci2I; cj2J; ca2P; ct2T (17)
Xmpijat þ Xnmpjt ¼ Qmpjt cj2J; ct2T (8)
i2I a2P i2I a2P

Occasionally, the conversion process requires other inputs (e.g. Xebiat  M*Yia ci2I; ca2P; ct2T (18)
methanol for biodiesel production) in order to obtain the biofuel.
Therefore, Equation (9) regulates a proper balance between the Xmbiat  M*Yia ci2I; ca2P; ct2T (19)
sourcing availability and the production needs.
X X
Xinputiaqt ¼ Qinputqt cq2Q ; ct2T (9) Xfueliat  M*Yia ci2I; ca2P; ct2T (20)
i2I a2P

The produced biofuel, after the conversion process, should reach XPiazt  M*Yia ci2I; ca2P; cz2Z; ct2T (21)
at most the total capacity in all the placed plants.
As mentioned before, the present model incorporates environ-
X mental issues to the contribution reported by Duarte et al. [7]. In
Xprodiawt  QPit *Yia ci2I; ca2P; ct2T (10)
w2W
this sense, the LCA stages have been formulated from Equations
(22)e(26). The impacts of biomass acquisition, pretreatment,
Equation (11) guarantees the proper assignment, where the transport (biomass and biofuel) and biofuel production are estab-
conversion plant i is only established in at most one region a, lished according to the conversion parameters fb, fbp, fbtija, fbftiaz
through the entire horizon planning. and fbfp, respectively.
X
Yia  1 ci2I (11)
a2P fb*Xmpijat ¼ IMPbijat ci2I; cj2J; ca2P; ct2T (22)
The conversion process (biomass þ other inputs / biofuel) is
expressed through the Equation (12). The term CRW represents the fbp*Xmpijat ¼ IMPbpijat ci2I; cj2J; ca2P; ct2T (23)
conversion rate at which the biomass is transformed into biofuel.
2 X
X fbtija *Xmpijat ¼ IMPbtijat ci2I; cj2J; ca2P (24)
Xprodiawt ¼ 4 Xmpijat þ Re ct2T
j2J
3
X ci2I; ca2P; cw2W;
 Xinputiqat 5*CRW X
ct2T fbftiaz *XPiazt ¼ IMPbftiazt ci2I; cz2Z; ca2P (25)
q2Q
ct2T
(12)
As can be seen in Equation (13), the produced biofuel is destined
fbfp*Xprodiaw¼1;t ¼ IMPbfpiaw¼1;t ci2I; ca2P; ct2T; w ¼ 1
both to the national (gas stations) and international markets.
(26)
ci2I; ca2P; ct2T;
Xprodiawt  Xnbiat þ Xebiat (13) Finally, the emission credits are formulated according to
w¼1
expression 27. In our SCND the credit equivalence (fec) correspond
The blending process is formulated according to Equation (14). to some other feedstock utilization alternatives (e.g. furniture in-
The final product for the national market is composed by fossil fuel dustries, food industries, heat generation, etc.) [33]. Transport to
and biofuel. The parameter MRt determines what percentage those points implies the credit values because the transportation
should be included of fossil fuel in the blending. This term may vary process never happens when the biomass is consumed in conver-
over the time horizon due to governmental regulations. sion process (biomass to biofuel).
 A. Duarte et al. / Energy 100 (2016) 321e331
fec*Xprodiaw¼1t ¼ IMPciaw¼1t ci2I; ca2P; ct2T; w ¼ 1
(27)
4. Case study: bioethanol production using Coffee-CS
The realistic situation examined in this paper consists of an
extension of the problem addressed by Duarte et al. [7]. Differing
from the mentioned case study, the feedstock may flow to other
supply chains that compete for the same biomass (see Fig. 2).
Despite of our SCND considers the byproduct generation; the pre-
sent case study does not undertake such situation.
The scenario described in Fig. 2 led to create a model with 6875
(6815 continuous and 60 binary) variables and 11,130 constraints.
The case study was encoded using the professional software GAMS
Distribution 23.9.3, release 2012.
Data associated with the proposed model can be found in
Appendix A. The biomass is constantly assumed for all the
considered supply chains (a few observed data of Coffee-CS avail-
ability). The production cost varies according to labor and utilities
cost fluctuation (see estimation methods in Table 5). Due to the
same technology used over the analyzed time periods, the plant
capacity is assumed as a fixed parameter value (200,000 t/year).
In order to set the penalty cost for unfulfilled demand, we
computed the average of historical demand for each gas station.
Thus, the following pseudo-code is programmed in the GAMS
console:
As far as the environmental parameters, we assumed the most
common conversion factors to measure the credits and negative
ecological impact. Table 6 summarizes the values defined for the
optimization experiment associated to the present case study.
Fig. 2. Supply chain scheme of the case study.
327
5. Experimental results and discussion
After running the proposed model using the Gurobi 6.0 exact
solver (implemented in GAMS software), we obtain multiple out-
comes that cover the SCND in our case study. A graphical illustra-
tion of the material flow (biomass to bioethanol) is presented in
Fig. 3. For the first period time (2014, t ¼ 1), the optimal plant
location must be established in Neiva City. The entire biomass
availability is utilized by this conversion plant and later, the pro-
duced biofuel only cover 20 of the 33 Colombian states (demand
points). From this figures one can realize that the Coffee-CS avail-
ability in Colombia is still insufficient to meet the current biofuel
market needs.
Similar to year 2014, in the remaining time periods
(2015e2023), the biofuel production must be carried out in Neiva
City. Based on the results reported in Table 7, some important re-
marks can be described as follows:
▪ The trend in the average of demand fulfillment shows a decre-
ment over the planed time periods; in consequence, there will
be a higher penalty cost. Spite of Colombia is a recognized global
coffee producer the Coffee-CS availability seems to be insuffi-
cient compared to the demand growth. For that reason, biofuel
production is only dedicated to the domestic market
consumption.
▪ The incremental behavior of the projected economical incomes
provides evidences to ensure that the future of biofuel market
appears to be promising.
▪ As can be seen, the logistic cost will experience a predictable
growth due to economic matters (price increasing of labor, raw
materials, utilities, etc.). However, the total economic benefits
over the analyzed time periods show an attractive behavior for
future investors and business development.
An important consideration is that the parameter forecast errors
have been investigated in the optimal material flow depicted in
Fig. 3. After using the estimation methods declared in Table 5, we
examined the “MAD” (Mean Absolute Deviation) for each input
parameter. In all parameter predictions, the MAD never exceeded
328 A. Duarte et al. / Energy 100 (2016) 321e331

Table 5
Estimation methods for input parameters.

Echelons Input Parameters Estimation method (2014e2023)

UPSTREAM Coffee-CS availability Vary according to the source location (LR, 6-MAT,SEST)a
Coffee-CS acquisition cost for bioethanol production and other supply Fixed value
chains
MIDSTREAM Bioethanol production cost Numerical projection using the Aspen Plus 2006.5 simulator and ICARUS
module
Conversion plant capacity Fixed value
Conversion rate Fixed value
DOWNSTREAM Bioethanol selling price for international market LR
Bioethanol selling price for national market including blending process LR
Gasoline acquisition cost LR
Blended percentage (gasoline þ bioethanol) Vary according to Colombian regulations (see in Ref. [34])
Gas stations demand LR
Unfulfilled demand cost Based on a proposed decision rule
All Transportation cost Equation proposed by Duarte et al. [7].
a
LR: Linear Regression; 6-MAT: Moving Average with Trends (6 moving periods); SEST: Single Exponential Smoothing with Trends.

Table 6
Environmental parameter values.

LCA-stage Term Value KgCO2eqiv./t Source

Biomass acquisition fb 31.85 [31]

Biomass Pretreatment fbp e Not considered
Transportation fbft 0.123 KgCO2eqiv./tkm [35]
Biofuel Production fbfp 500.00 [19]
Emission Credit fec Emission Credit 1 160.34 [36]
Emission Credit 2 1383.47 [35]
Total 1543.81

Fig. 3. Optimal material flow (thousands of tons).

 A. Duarte et al. / Energy 100 (2016) 321e331 329

Table 7
Economical optimization results in the case study.

Average of fulfilled Economical incomes (EI) USD/ Logistic cost (LC) (USD/Year) Economic Plant
Demand (%) Year benefit location
Biomass Conversion Biofuel Blending Penalty
(USD/Year)
acquisition process distribution

2014 81.07 8.74Eþ08 1.29Eþ07 1.67Eþ07 2.69Eþ07 5.54Eþ07 e 7.62Eþ08 Neiva City
2015 76.61 8.81Eþ08 1.33Eþ07 1.69Eþ07 2.64Eþ07 5.56Eþ07 e 7.69Eþ08
2016 76.61 8.65Eþ08 1.38Eþ07 1.71Eþ07 2.58Eþ07 5.46Eþ07 e 7.54Eþ08
2017 76.61 8.41Eþ08 1.43Eþ07 1.74Eþ07 2.51Eþ07 5.31Eþ07 e 7.31Eþ08
2018 64.72 9.16Eþ08 1.48Eþ07 1.79Eþ07 2.59Eþ07 5.14Eþ07 3.09Eþ05 8.06Eþ08
2019 56.84 9.69Eþ08 1.52Eþ07 1.84Eþ07 2.67Eþ07 5.44Eþ07 3.68Eþ06 8.50Eþ08
2020 52.23 1.02Eþ09 1.57Eþ07 1.89Eþ07 2.77Eþ07 5.74Eþ07 5.06Eþ06 8.98Eþ08
2021 49.60 1.08Eþ09 1.62Eþ07 1.94Eþ07 2.85Eþ07 6.05Eþ07 6.07Eþ06 9.47Eþ08
2022 48.36 1.13Eþ09 1.67Eþ07 2.00Eþ07 2.95Eþ07 6.36Eþ07 7.04Eþ06 9.97Eþ08
2023 51.09 1.19Eþ09 1.72Eþ07 1.86Eþ07 3.22Eþ07 6.69Eþ07 5.56Eþ06 1.05Eþ09

2% of the average of forecast values. However, the possible distur- sustainable. In order to analyze the effects on economic benefits and
bances (predicted value ± MAD) caused by the forecast errors were gap, based on CO2 price variation [37] a sensitivity analysis was
analyzed in some additional computational experiments. As we performed for three possible scenarios (see Table 9).
expected, the optimization results does not showed significant In Fig. 4, scenarios 1a, 2a, and 3a show the effects of CO2 price
changes regarding the decisions variables (i.e. the same location variation on the economic benefit and demand fulfillment over the
result and material flow configuration). time horizon. In turn, scenarios 1b, 2b and 3b depict the economic
On the other hand, we examine the ecological performance of benefit and gap variation. As can be seen, CO2 price variation
the proposed SCND over the next 10 time periods (2014e2023). considerably affects the economic benefit and demand fulfillment.
Table 8 presents the environmental optimization results corre- According to the obtained results, Neiva City persists as the best
sponding to the bioethanol production from Coffee-CS. place for the conversion plant location in the three analyzed sce-
The observed increase of emission credits is a result of higher narios. Although Scenario 3 shows better results from an environ-
biomass availability. That is, when Coffee-CS is much more used for mental point of view, the Scenario 1 exhibits the best tradeoff
bioethanol production, the environment receives a positive influ- between the considered goals.
ence because of lower GHG emissions. In the same way, a higher
feedstock sourcing has direct effect over the Coffee-CS acquisition
and transportation and bioethanol production. It is interesting to 6. Conclusions
see that the negative impact of bioethanol distribution shows a
reduction after some years. One can expect that a higher bioethanol In this paper, a SCND is proposed considering particular charac-
production imply more operations in transport; however, the used teristics of the bioethanol production from Coffee-CS. We provided a
exact algorithm (implemented in GAMS), found less traveled dis-
tance in the solution space generated by echelons configuration
Table 9
(from one production plant to 20 demand points). CO2 price projections [37].
Furthermore, we proposed to compute the percentage deviation
Time period CO2 price at time t(US$/kg CO2 equiv.)
between positive and undesirable ecological effects. One can
determine such deviation according to the following gap (G) Scenario 1 Scenario 2 Scenario 3
expression: 2014 13.6 15 25
2015 14.8 17.8 28.9
2016 16 20.6 32.8
½ðEMCt Þ  ðCCSAt þ CCSTt þ BPt þ BDt Þ 2017 17.2 23.4 36.7
G¼ ct2T (28)
EMCt 2018 18.4 26.2 40.6
2019 19.6 29 44.5
The G values in Table 8, indicates that the proposed optimization 2020 20.8 31.8 48.4
model is suitable for a better environmental performance in the case 2021 22 34.6 52.3
study. The previous outcomes provide enough evidence to state that 2022 23.2 37.4 56.2
2023 24.4 40.2 60.1
the bioethanol production from Coffee-CS is both profitable and

Table 8
Environmental optimization results in the case study.

LCA-stages values (Kg CO2-eq) G(%)

Emission credits (EMC) Coffee-CS acquisition (CCSA) Coffee-CS transportation (CCST) Bioethanol production (BP) Bioethanol distribution (BD)

2014 1.44Eþ08 1.37Eþ07 1.45Eþ07 4.65Eþ07 2.88Eþ07 27.98

2015 1.48Eþ08 1.41Eþ07 1.45Eþ07 4.79Eþ07 2.73Eþ07 29.83
2016 1.52Eþ08 1.46Eþ07 1.46Eþ07 4.93Eþ07 2.58Eþ07 31.57
2017 1.57Eþ08 1.50Eþ07 1.46Eþ07 5.07Eþ07 2.43Eþ07 33.21
2018 1.61Eþ08 1.54Eþ07 1.47Eþ07 5.21Eþ07 2.27Eþ07 34.85
2019 1.65Eþ08 1.58Eþ07 1.47Eþ07 5.35Eþ07 2.15Eþ07 36.17
2020 1.70Eþ08 1.62Eþ07 1.48Eþ07 5.49Eþ07 2.11Eþ07 36.94
2021 1.74Eþ08 1.66Eþ07 1.48Eþ07 5.63Eþ07 2.11Eþ07 37.39
2022 1.78Eþ08 1.70Eþ07 1.49Eþ07 5.77Eþ07 2.14Eþ07 37.70
2023 1.83Eþ08 1.74Eþ07 1.49Eþ07 5.91Eþ07 2.25Eþ07 37.59
330 A. Duarte et al. / Energy 100 (2016) 321e331

Fig. 4. Sensitivity analysis based on the proposed scenarios.

mathematical model that includes the environmental issues based
on the LCA stages analysis. Both economic and ecological perfor-
mance has been examined in a Colombian realistic case study.
The experimental results showed three main aspects that
should be considered in decision-making. First, the Coffee-CS
availability is still insufficient for the biofuel production according
to market needs. The projected scenarios show that the average
fulfilled demand is 80% at most, which indicates that the biofuel
customer zones require of multiple feedstock sources in the future.
Secondly, after running the proposed model over 10 time-
periods, Neiva City proved to be the optimal location for the
conversion plant. Furthermore, the biofuel production from Coffee-
CS showed to be not only a promising business, but also, a sus-
tainable alternative for energy generation. Thus, the proposed
SCND for the bioethanol production from Coffee-CS seems to be a
beneficial solution alternative, anticipating economical growing
and environmental sustainability in the projected time horizon.
However, according to the performed sensitivity analysis, the
fluctuation of CO2 prices must be considered for decision making.
Future research should be addressed to consider changes in deci-
sion variables such as technology type, transportation mode and
other second-generation feedstock.
 A. Duarte et al. / Energy 100 (2016) 321e331
Acknowledgments
The authors are grateful to Universidad Nacional de Colombia
Sede Manizales for funding this work.
Appendix A. Supplementary data
Supplementary data related to this article can be found at http://
dx.doi.org/10.1016/j.energy.2016.01.076.
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