An optimization approach to resolve multiple decision making in a pulp and paper biorefinery

Siu Hoong Lee, Irene M. L. Chew, Andrew Forbes Alexander Hoadley

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Biorefineries stemming from pulp and paper mills (PPMs) and other processes have been noted to offer improved economic and environmental performances. In such an industrial cluster, biomass from PPMs is processed into biofuel and bioproducts through different biorefinery technologies. Given the highly integrated material and energy networks, it is not uncommon for the industrial cluster to be operated by multiple enterprises. This gives rise to an eco-industrial park (EIP), where each enterprise acts as an independent decision maker. Here, the actions of each enterprise are driven by rational self-interest, capable of influencing the outcome of the EIP scheme. Thus,competition emerges to report the optimal EIP scheme, leading to a multiple decision making (MDM) problem. In this work, the MDM problem is resolved through mathematical optimization and game theory. An EIP case study based on a PPM Biorefinery is used to illustrate the proposed approach. Firstly, an optimization model was formulated which reported an EIP scheme with a positive overall economic payoff. However, there was an unequal distribution of economic payoff among individual enterprises. This is resolved by analyzing the individual payoffs through cooperative game strategy. Here, enterprises hold equal power in the EIP and coordinate their strategy together by varying the prices of goods/energy being traded between each other. In this work, two cooperative game scenarios are analyzed. The first scenario seeks to report a solution where each enterprise has a positive economic payoff while the second scenario aims to achieve a uniform internal rate of return.
Original languageEnglish
Title of host publicationChemeca 2016
Subtitle of host publicationChemical Engineering - Regeneration, Recovery and Reinvention
Place of PublicationMelbourne Vic Australia
PublisherEngineers Australia
Number of pages10
ISBN (Print)9781922107831
Publication statusPublished - 2016
EventChemeca: Australasian Conference on Chemical Engineering 2016 - Adelaide, Australia
Duration: 25 Nov 201628 Nov 2016
Conference number: 44th


ConferenceChemeca: Australasian Conference on Chemical Engineering 2016
Abbreviated titleCHEMECA 2016


  • Biorefinery
  • Game theory
  • Industrial ecology
  • Pulp and paper

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