Semester

Fall

Date of Graduation

2004

Document Type

Thesis

Degree Type

MS

College

Statler College of Engineering and Mineral Resources

Department

Industrial and Managements Systems Engineering

Committee Chair

B. Gopalakrishnan.

Abstract

A common notion in the industry is that energy is an overhead and not related directly to the product. Measures that reduce electric demand are usually considered in isolation and their effect on the other costs related to the product is ignored. This is especially true for multi-product operations where the demand for various products is not constant and it is hard to track the costs associated with each product. This research takes a software based approach to analyze how a demand reduction measure affects the carrying cost, stockout cost, labor cost, electric usage cost and electric demand cost. This tool can evaluate different demand reduction strategies and their effect on the overall cost. Sensitivity analysis revealed the factors that affect the costs the most. The results of this research suggest that the interactive effects of any demand reduction measure should be considered before implementing them.

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