Multi-echelon value chain design under emerging economy

Cast study 1 - South African Sugarcane biorefinery supply chain model

Africa, a continent with over 1 billion population, is experiencing energy poverty and food insecurity and vulnerable to climate change threats. Most African countries are net fossil fuel importers, exposed to global oil price volatilities. In 2009, over 60% of African population still had no access to modern energy and infrastructure (projected to decrease to 35% by 2040), which constrains the regional economic development and livelihood improvement (e.g. healthcare, education services). Besides energy poverty, African economic growth is contributing to the environmental impacts e.g. the deforestation and air quality issues caused by the wood and charcoal cooking fuel used in rural communities. Besides, the electricity in African region is driven by fossil resources – two third of the demand is met by the coal-dominated (over 92%) electricity generation in South Africa. In coming decades, renewable energy including bioenergy is expected to play significant roles within the overall African energy portfolio to meet increasing demands. However, bioenergy deployment under the special context of South Africa is constrained by many factors such as technology availability and process efficiency, resource accessibility and local economic development. Moreover, bioenergy is a complex system, which involves many interrelated and/or conflicting issues e.g. economic developments vs. social and environmental benefits, co-relations between macro-economy at regional or supply chain levels and benefits/decisions of individual stakeholders. At the decision-making level, it is difficult to elaborate optimal pathways to efficiently utilize resources to achieve a long-term energy target meanwhile balance conflicting issues involved. Therefore, this requires an understanding of whole biorefinery system and supply chain level but also the stakeholders involved to achieve environmentally sustainable and socio-economically viable development of biorefinery development and bioenergy penetration, which benefit local community, meanwhile balances with other systems.

This cross disciplinary project is being carried out in collaboration with University of Stellenbosch, South African Sugarcane Research Institute. The ongoing research was initiated under the financial support from the Newton Funds Researcher Links Travel Grant and Royal Society Newton International Exchange Grant Award in 2015. Our joint research efforts are leading to an integrated multi-level modelling framework [3] which combines crop models, simulation models and multi-objective optimisation to solve two-level design issues, namely multi-stakeholder sugarcane supply chain and biorefinery process design, while keeping these two levels consistent in operational and strategic context . Via a case study in the Kwazulu-Natal region of South Africa, this research demonstrates the insights the proposed framework could provide for supporting decision-making on South African whole sugarcane system over next decades.

Cast study 2 - Supply Chain Optimisation of Nipa-based bioethanol industry in Thailand

This ongoing research is being carried out in collaboration with Prince of Songkla University.

Transport sector is responsible for approximately 25% of energy-related greenhouse gas (GHG) emissions worldwide, where 72 % are caused by the road transport. A range of environmental issues including increasing GHG levels and the depleting fossil resources have triggered ambitious global/regional/national policies mandating the development of biofuel and bioenergy within the energy portfolio. At an average annual increase rate of 3 percent, it is projected that in 2035, the global demand for bioenergy will double to nearly 1200 Mtoe from 526 Mtoe in 2010. Particularly, biofuel sector has been promoted as one of the environmentally favourable options for tackling climate change and fossil resource scarcity, undergoing significant development since 2000s. Renewable biomass particularly non-food resources have attracted considerable research interest due to natural abundance, ease of accessibility. Non-food renewable biomass are expected to play significant roles over the coming decades in the transition from an oil-dominated to a sustainable bio-based society.

Our joint research focuses on the modelling of biofuel production from non-food crop Nipa Fruticans (commonly known as Nipa palm) under the special context of Thailand. Nipa palm is an untapped resource, abundant in Thailand. It is widely growing along the coastlines of most South East Asian countries and some African countries and Nipa cultivation has not yet been commercialised. Nipa is regarded as an ideal biofuel feedstock due to its perennial habit, fast growth, high sugar content and range of traits. In comparison with well-developed sugarcane biofuel industry (typical ethanol yield from sugarcane could reach 6000L/ha/year), Nipa has greater biofuel potential producing up to 9000 L/ha/year.  In addition,  as opposed to resource-competing bioenergy crops which demand the same land disponibility, nutrient use, and water supply as food crops,  Nipa palm has the advantage to grow wildly and exclusively on the shore and therefore, does not pressure the inland productive fields or require additional nutrient or irrigation.  However, the sustainable development of Nipa industry needs quantitative decision-making tools to consider multiple sustainability issues for the whole supply chain.  Our research lead to a decision-making tool development addressing both economic and environmental aspects, providing a spatially-explicit presentation of inter-linkages between market players, considering policy and market changes on the whole supply chain over multiple time periods [4].