(240v) Optimal Design of Batch-Storage Network under Random Failures and Waste Treatment Processes

The purpose of this study is to find the analytic solution of determining the optimal capacity (lot-size) of batch-storage network to meet the finished product demand under random failures of operating time and/or batch material. The superstructure of the plant consists of a network of serially and/or parallel interlinked batch processes and storage units. The production processes transform a set of feedstock materials into another set of products with constant conversion factors. Final product demand flow is susceptible to short-term random variation of cycle time and batch size as well as long-term variation of averaged trend. Some of production processes have random variation of product quantity. The spoiled materials are treated through regeneration or waste disposal processes. All other processes have only random variation of cycle times. The objective function of optimization is minimizing the total cost composed of setup and inventory holding costs as well as the capital costs of constructing processes and storage units. A novel production and inventory analysis, PSW (Periodic Square Wave) model, provides a judicious graphical method to find the upper and lower bounds of random flows. The advantage of PSW model comes from the fact that the model provides a set of simple analytic solution in spite of realistic description of the random material flow between processes and storage units and consequently the computation burden is significantly reduced. The resulting simple analytic solution can greatly enhance the proper and quick investment decision at the early plant design stage confronted with highly uncertain business environment.