Network design for reverse logistics considering carbon tax
by Bandar A. Alkhayyal
International Journal of Industrial and Systems Engineering (IJISE), Vol. 39, No. 1, 2021

Abstract: A research model using the market price for emission allowances per metric ton illustrates how the economic and environment mechanisms of carbon price can be formulated using deterministic equilibrium model. Moreover, this framework allows us to examine the performance of, and identify how the policy proposed would affect the profitability of remanufactured goods; a comprehensive study for the quantitative evaluation and performance of the model has been done using orthogonal arrays. As demonstrated by the results, the policy related to carbon tax brings about a powerful limitation on the quantity of emissions of carbon produced by the operations of supply chains; the case study herein employed real sites and data from the Boston region. Lacking in a carbon tax, the margin of profit realised by the A/C unit is 26%, while the amount suggested by the USEPA, $40/ton CO₂ equivalent (tCO2e) tax, lessen the profit margin to 19%. A comparison of the results through the use of the economic input-output life cycle assessment (EIO-LCA) model, demonstrates that remanufacturing quantities of emission are 0.03 tCO2e/unit lower than refurbished manufacturing.

Online publication date: Mon, 20-Sep-2021

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