Logistics Operations, Supply Chain Management and Sustainability

Abstract

Greenhouse gases emission is a major concern globally since they are key players in global warming. Some countries have signed the Kyoto Protocol, and set up some regulations to reduce their CO 2 emissions. Optimizing inventory and routing decisions can help in the reduction of CO 2 emissions if these emissions are taken into account by the decision makers. In the formulation, CO 2 emitted by transporting the product is modeled. The chapter investigates the effect of CO 2 emissions on the inventory and routing decisions determined over a given time horizon. The model is coded and solved in GAMS. The test results are used to indicate that emission costs should be considered when deciding the routing and inventory decisions.