A Time-and-Space-Network-Based Green Fleet Planning Model and Its Application for a Hub-and-Spoke Network

Abstract

Most previous studies on airline fleet planning have focused solely on economic considerations, neglecting the impact of carbon reduction. This paper presents a novel method for green fleet planning, using a bi-level programming model to balance conflicts among stakeholders while considering uncertain parameters such as demand and operating costs. The upper model aims to reduce carbon emissions by taking into account government constraints, such as carbon allowances and carbon prices, as well as airline satisfaction. The lower model seeks to maximize airline revenue using a space-and-time network model based on given airline flight schedules. To verify the game model, a case study utilizing randomly generated scenarios is employed within the context of China’s aviation-specific emissions trading scheme. Results show that: (1) compared to the scenario without a policy aiming at reducing carbon emissions, this method reduces carbon emissions by 23.03% at the expense of a 6.96% reduction in terms of the airline’s operating profit; (2) when passenger demand levels increase to 160%, the profitability of the proposed fleet increases by 50.83%, while there were only insignificant changes in carbon emissions; (3) the proposed methodology can assist the airlines systematically to reduce carbon emissions and provide valuable strategic guidance for policy makers.