CAREER: Large-Scale Parallel Replacement Analysis

Lehigh University, Bethlehem PA

Investigators

Abstract

This grant provides funding for an investigation into the modeling and solution of large-scale parallel replacement problems. Specifically, investigations will be pursued into problems under demand and capital budgeting constraints for heterogeneous groups of assets with multiple challengers. Characteristics including economies of scale in purchase prices, asset availability constraints, and after-tax implications caused by group asset depreciation policies will also be explored. A variety of modeling and solution procedures are to be examined, including: (1) General integer programming with resource directive decomposition solution procedures and cutting plane algorithms developed from integer knapsack covers; (2)Dynamic programming which capitalizes on the special structure of optimal solutions under capital budgeting constraints and economies of scale; and (3) Stochastic programming, with deterministic analyses extended to scenario analysis, stochastic dynamic programming and recourse models. This career plan is also defined by a closely related educational component. As replacement analysis is a fundamental problem in engineering economics, investigations will lead to teaching improvements in this core engineering subject area. If successful, the results of this research will lead to the solution of new replacement problems, both in size and scope, commonly faced by industry, the government and the military. These results are to be verified with industrial partners that operate large fleets of diverse assets. The investigations should also provide further insight into the solution of large-scale mathematical programs with special structure and their application to real problems. The educational investigation in this project will lead to an improvement and standardization of teaching engineering economy, regardless of the engineering discipline.