Optimizing multi-resource-based energy supply chains in developing economies: A periodic review model for affordable and sustainable solutions

Abstract

Electricity shortages are prevalent in developing countries, further exacerbated by the advocacy of zero-carbon policies to mitigate global climate change. This transition away from fossil fuels poses significant challenges in establishing cost-effective and sustainable energy supply networks. To tackle these challenges, this research assesses the influence of operational efficiencies, advancements in transmission technology, and strategic facility placements on the design of energy supply chains. We prioritize factors such as investment requirements, transmission yield, energy mix, carbon emissions, and social costs. We construct a robust optimization model with stochastic parameters that examines extreme scenarios. Applying this framework to a real-world case in Pakistan spanning a 30-year planning horizon, we present a novel approach that simultaneously diversifies raw material reserves while determining optimal power generation capacity and transmission technologies. Our analysis shows that integrating renewable energy resources and changing transmission methods within the current energy mix can yield an affordable and sustainable energy supply chain, reducing reliance on coal. Consequently, the study case demonstrates substantial reductions in carbon emissions and social costs by 85.68 % and 17.81 %, respectively, in the second and third 10-year planning intervals.