Supplier selection and operation planning in biomass supply chains with supply uncertainty

Bioenergy is considered a potential solution to reduce carbon footprint and fight against global warming. However, uncertainty in the harvest of biomass could lead to the instability of feedstock supply that has a significant impact on the sustainability of biomass supply chain. In this paper, we present a two-stage stochastic programming model dealing with supplier selection to stabilize feedstock supply of a biomass supply chain in uncertain environments. The model involves the first stage decisions for the supplier selection and the second-stage decisions for planning transportation, inventory and production operations. To reduce the computational burden for large instances, we propose an enhanced and regularized L-shaped decomposition algorithm to solve the model. The applicability of this model and the performance of the solution method are evaluated by numerical studies. Sensitivity analysis shows that the values of some parameters related to suppliers have significant impacts on the optimal expected cost and supplier selection. (C) 2018 Elsevier Ltd. All rights reserved.