Sustainable Economic Production Quantity Model Considering Greenhouse Gas and Wastewater Emissions

Abstract

Pursuing sustainability in the production inventory model has motivated researchers to reconsider carbon emission costs. In this study, we develop an economic production quantity (EPQ) inventory model to consider greenhouse gas and wastewater emission costs. This study aims to optimize the production quantity, the total costs per production cycle, and the waste emissions. To validate and test the model, data from a pulp and paper mill industry was used. The effectiveness of the model was determined by comparing the costs generated under three (3) scenarios: (1) an EPQ model that considers the costs of greenhouse gas (GHG) emissions; (2) an EPQ model considering shortages; and (3) a multiproduct EPQ model considering shortages. Our proposed sustainable EPQ models can provide decision-makers with insights to visualize how certain factors affect the manufacturing system. Future research can be conducted to consider the product life cycle as well as deteriorating items.