Background
+Demand For Bio-Fuels
+
+ The Energy Independence and Security Act (EISA) of 2007 in the U.S. established a minimum volume
+ of renewable fuels required for blending with fossil fuel to be 36 billion gallons by 2022, and 44.4%
+ of that amount must be produced from cellulosic ethonol in the U.S. in order to achieve the desired
+ reduction in greenhouse gas emissions in the transportation sector. Given this legislation, a conservative
+ estimate will see the bio-fuel market cap at around 80 billion US dollars.
+
Sorghum
+
+ Sorghum is a type of grass that can be used to create cellulosic based bio-fuels. It has an annual
+ harvest of give give or take 13 weeks usually falling within of the 30th and 40th weeks of the year. Sorghum is best
+ grown in warm or tropical environments. It requires a soil temperature of 65° and after germanation
+ has the potential to be killed off by a frost. Sorghum typically needs between 400-600mm of rainfall
+ and should be spaced with an optimal planting density of approximately 120,000 plants per hectare.
+
Simulation-Optimization Methodology
++ The value of the sim-Op methodology is it can create an optimal solution while still being verified in + a stochastic environment to emmulate a real world logistics problem. In our tool we utilize a hub and spoke + mixed integer program that solves for both the tactical and strategic decision associated with farmgate + operations associated with sorghum. The simulation uses random variables based on the parameters to add a + degree of variability to the processing rates of equipment and harvest yields. Since the optimization creates + a solution that is a pull system, if the processing rates are lower than what is expected, effectiveness of + solutions is variable. The sim-op methodology will highlight this result and let you revise your parameters + so that you can create a solution feasible for a real world operation. +
+