PITA Fiscal Year 2008 Projects - Product and Process Design and Optimization

Resiliency And Robustness For The Chemical And Industrial Gases Industries

The chemical and industrial gases industries are highly dependent on a transportation infrastructure composed of truck, rail, sea, air, and pipeline modes, as well as bulk storage locations. Like any major infrastructure, these transportation networks are vulnerable to intentional and accidental disruptions, but the chemical industry is particularly vulnerable both because of the visibility of the industry and because of the volatility and flammability of many of its products. The industrial gases industry is also highly process intensive. For example, air separation plants use very few raw materials (primarily electricity and air) to produce liquid and gas products. These plants are susceptible to extremely volatile energy prices, both over the course of weeks or months and within a given day.

The objective of this research is to develop models and algorithms to help the chemical and industrial gases industries deal with this extreme uncertainty, both in processing activities and in distribution operations. The research consists of two main components: In the first, we will develop strategic (i.e., long-time-horizon) models to design supply chain networks that are resilient to disruptions. In the second, we will develop operational (i.e., short-time-horizon) models to plan production activities in a factory with volatile energy prices. Our project will be conducted in close coordination with our industrial partner, Air Products and Chemicals, located in Allentown, PA. Air Products operates in several industries; the first component of our research will apply primarily to the company’s chemicals division, while the second will be applicable to its liquid bulk, i.e., industrial gases, operations. The second component will be conducted in collaboration with Dr. Lorenz Biegler of CMU. This project has an educational component consisting of research and training for Ph.D. students. These components are all discussed in more detail below.