The era of renewables: Infrastructure disposal strategies under market decline of oil products

As the demand of fossil fuel declines, improving the infrastructure development of fossil fuel supply chain is the efficient way to reduce cost and carbon emissions. This paper analyzes the impact of declining oil demand on the infrastructure development of the oil products delivery system. A mathem...

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Bibliographic Details
Published in:Energy (Oxford) 2022-06, Vol.249, p.123581, Article 123581
Main Authors: Zhu, Zhu, Liao, Qi, Liang, Yongtu, Qiu, Rui, Zhang, ZeZhou, Zhang, Haoran
Format: Article
Language:English
Subjects:
Cost analysis
Depot
Destruction
Disposal strategy
Emissions
Fossil fuels
Impact analysis
Infrastructure
Market decline
Mathematical models
Oil
Oil products
Relocation
Storage
Supply chains
Utilization rate
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Summary:As the demand of fossil fuel declines, improving the infrastructure development of fossil fuel supply chain is the efficient way to reduce cost and carbon emissions. This paper analyzes the impact of declining oil demand on the infrastructure development of the oil products delivery system. A mathematical model is proposed to simulate the transportation and storage schemes, and then is generalized to different forms based on four disposal strategies of idle depots and five sub-scenarios of declining demand. The discussed disposal strategies include storage of other fuels, relocation, destruction and to be sold. A comprehensive evaluation system is also formulated to evaluate the utilization efficiency of the transit depots. Finally, the oil products delivery system in Northwestern China is used to validate the proposed method. Compared with the current system, improving the utilization rate of the depot under declining demand sub-scenarios can improve the economic efficiency by 10.6%, 8.9%, 17.3%,21.3% and 21.6%. With the decline in demand, the economy of destruction of transit depot is better than others, while the environmental benefit of storing other fuels is better than other strategies. •A mathematical model simulated the schemes of the oil products delivery system is developed.•A comprehensive evaluation system of depot's utilization efficiency is proposed.•The simulation model is generalized to different models based on four depot disposal strategies.•Different disposal strategies bring different economy and environment effects.
ISSN:0360-5442
1873-6785
DOI:10.1016/j.energy.2022.123581