Power Forecasting and Fleet Location Optimization American Commercial Barge Line LLC

1. CELDi Center for Engineering Logistics & Distribution Power Forecasting and Fleet Location Optimization American Commercial Barge Line LLC Gail W. DePuy, G. Don Taylor and Amy Bush

2. CELDi Center for Engineering Logistics & Distribution Poster Overview • Two separate problems • Problem 1 – Power Forecasting • Problem Definition • Problem Setting • Solution Approach • Problem 2 – Fleet Location Optimization • Problem Definition • Problem Setting • Solution Approach • Project Status • Conclusions & Plans

3. Problem 1 – Power Forecasting Problem Description • Determine which boat carries each barge • Minimize barge handling costs • Minimize barge dwell (idle) costs • Minimize sub-contract charges • Understand the trade-off between tows with low handling costs (common destinations) versus tows with low dwell costs (different destinations) • Use a technique that can be used on a real-time basis

4. Problem 1 – Power Forecasting Problem Setting • Ohio River from Cairo, IL (confluence of Ohio & Mississippi Rivers) to Pittsburgh, PA • Dozens of input/output port locations • Hundreds of barges • Two-week rolling planning horizon • Dynamic river conditions & stochastic demand • Very little help in the published literature

5. Problem 1 – Power Forecasting Solution Approach • Simulation Heuristic • Extremely detailed analysis • Comprehensive & easy to understand & use • Useful for comparison & validation • Real time barge scheduling capabilities • Series of local optima sought; boats can compare the cost of barge assignment to the cost of assignment to other boats in the system • Complex boat management rules including when it is better to turn the boat • Extremely detailed analysis • Basic tradeoff between handling & dwell costs • Use SIMNET II

6. Problem 2 – Fleet Location Opt. Problem Description • Strategic Issue - Determine river locations to use for various activities (Dynamic Facility Layout Problem) • Tow building/Tow breaking • Barge Cleaning • Barge Repair • Determine number and type of boats needed • Locate activities to minimize costs • Considerations: • Distances between fleet locations • Boat types – operating rules and costs • Barge volumes • Cleaning and Repair times

7. Problem 2 – Fleet Location Opt. Problem Setting • New Orleans/Lower Mississippi River • 130 current fleet/customer locations • Thousands of barges • 4 boat types • One month planning horizon • Dynamic river conditions

8. Problem 2 – Fleet Location Opt. Solution Approach • Integer Programming Formulation • Objective: • Minimize travel, cleaning, and repair costs • Constraints: • Barge volume balance constraints at each location • Fleet capacity • Boat rules – certain boat types can only operate in certain areas of river • Determination of cleaning locations • Determination of repair locations

9. CELDi Center for Engineering Logistics & Distribution Project Status Problem 1 – Power Forecasting • Basic simulation model has been developed • Implementation in process • Model enhancements to be considered Problem 2 – Fleet Location Optimization • IP model being developed • Data collection in process

10. CELDi Center for Engineering Logistics & Distribution Concluding Remarks • Two separate deliverables • Power Forecasting SIMNET Simulation Tool • Fleet Location Optimization Tool (IP program) • Power forecasting SIMNET simulation tool can be used to schedule barges on an hourly basis • Fleet location IP model can be used to perform ‘what-if’ analysis to consider the acquisition of new fleet locations