Supply Chain Enterprises’ Production And Reduction Decision-making Mechanism Research Considering Emission Regulation And Trading

From the perspective of cap and trade, carbon emission permit has become a newtype of enterprise’s resource which can be traded in the market. Emission reductionhas the value attributes of products and services. Taking carbon emission permitcoexisting in the supply chain as a kind of special resources and integrated into theenterprise operation optimization will change the relationship between enterprisesfrom the traditional pattern of "two-dimensional trade" to the new pattern of"three-dimensional transaction". Moreover, the contract energy management and theresulting new economic relations have appeared in reality. These low-carbon economycharacteristics make the supply chain’s cost structure, profit model and market risktransform profoundly. So many new problems have emerged for enterprises to realizelow carbon supply chain operations. According to the above situation, this paper putsforward the topic "Supply Chain Enterprises’ Production and ReductionDecision-making Mechanism Research Considering Emission Regulation andTrading" and discusses the following items:(1) When allowance is made for the carbon emissions reduction and transactioncosts, the profit functions can be deduced that retailer takes retail price as decisionvariable and manufacturer takes wholesale price as decision variable. Through theanalysis of centralized and decentralized decision-making, it can be derived thatoverhigh emission reducing cost means that the manufacturer will pay a huge cost toreduce carbon emission, and then will lose the cooperative space when cooperateswith retailer, meanwhile, overlow means that the product will lose competition ability,it has little rate of return on investment.(2) Through investigating how upstream and downstream enterprises in thesupply chain choose cooperational reduction strategy while they are facingenvironmental regulation, we can get their profits and reduction efficiencies in threedifferent situations. It can be obtained that in full-cooperation case, both their profitand reduction efficiency are optimal. The results show that in the process of lowcarbonization of manufacturing enterprises, government should aim at the enterpriseswhich emit larger carbon and grab from the source of supply chain firstly, alsoenterprises must reduce their optimal output in order to reduce their total emissions.(3) Considering the reduction and pricing problem of a carbon emission permitsupply chain system which is composed by one manufacturer and one energymanagement company (EMC), we can get the inclusion by means of designing twokinds of sharing contract that the optimal pricing and reduction decision depend mainly on the two subjects’ marginal abatement cost and the carbon price, themanufacturer profit margin arising from the different sharing contracts has a criticalvalue, but for EMC, profit sharing contract can bring more profit value.(4) We will discuss emission reduction and sharing decision making problem of asupply chain system which is composed of a single emission reduction suppliers anddownstream retailer. Under the revenue sharing consignment contract, by means ofcomparison decentralized decision-making with the centralized, we can not only getthe optimal abatement level and yield under the decentralized decision, but also therelationship with share proportion and the range of the optimal sharing proportionwhich can urge the supplier reduce emission and the retailer achieve the optimal profit.Moreover, the retailer need coordinate the sharing proportion with the cost sharingrate in order to make the supply chain achieve the optimum value which is equal tothe centralized decision.(5) Manufacturer who produces perishable good will not only be affected by thegovernment regulation of carbon emission, but also by the carbon price decision ofthe upstream supplier. By the establishment of the two agents Stackelberg gamemodel, we can get the conlusion that the impact of unit product’s carbon emission andthe government’s ‘cap-and-trade’ regulation on two agents profit is inversed. Also thegovernment should reasonably establish carbon emissions’ cap, and manufacturershould effectively control product’s carbon emissions. Only in this way can make theincrement of the two agents’ utility optimal.