Carbon Reduction Strategy For Low-carbon Supply Chain Based On Input-output Analysis

With the Kyoto Protocol coming into effect, policies are introduced byinternational governments to limit greenhouse gas emissions. The low-carboneconomy has risen. Under the environment of low-carbon economy, carbon emissionrights have become into scarce resources in production activities and carbon reductionhas to be considered. Since all carbon emissions are generated to meet the demand offinal consumption, studying carbon reduction strategies from the perspective of thesupply chain is important both in theoretical and practical aspects.In the framework of the supply chain, by investing in carbon reduction, on onehand, the production process and material utilization can be improved, which canreduce the material requirements from supply chain upstream and thereby reduce thecarbon emissions of the overall supply chain. On the other hand, the purificationprocess can be improved, which can reduce the newly increased carbon emissions ofenterprises. By investing in carbon reduction, the surplus carbon emission rights canbe sold to make profits through carbon trading market. At the same time, by investingin carbon reduction, enterprises can reduce their damage to the environment, thusenhancing the social image and getting both economic and social benefits.In this context, supply chain with any complex structure is studied using bothlow-carbon economy and input-output analysis theory. To study the stimulatingrelationship of value and carbon emissions between supply chain enterprises, thevalue and carbon emissions input-output relationship are analyzed and the influencecoefficients of value and carbon emissions are built.Based on input-output analysis of value and carbon emissions, the feasibility ofcarbon reduction is analyzed and focus enterprises are found considering the trade-offbetween economic development and environmental protection in low-carbon supplychain.For focus enterprises of carbon reduction, considering three kinds of carbonemission rights including government allocation, market trading as well as carbonreduction investment, to find the optimal carbon reduction strategies under carbonemission constraints and achieve the lowest cost of carbon emissions, carbonreduction optimization model is established. Based on carbon reduction optimization, the study is extended to multi-cycle. Inmulti-cycle, considering determined market demand and variable yield, productionoptimization model for focus enterprises is established in order to find the optimalcarbon reduction and production strategies and achieve the maximum profits.