Captive Power Plant Selection for Pakistan Cement Industry in Perspective of Current Energy Crises: A Fuzzy-AHP Approach

Abstract

Based on the prevailing energy crisis, it is reasonable for the Cement industry of Pakistan to look for alternate sources of electricity generation. The decision of selecting a CPP (Captive Power Plant) depends on a broad variety of parameters which may be conflicting to each other. A comparative evaluation of these CPP’s should be helpful for industry, particularly if the applied methodology can handle with the real world ambiguities and imprecisions associated with the data pools and expert opinions. This paper utilizes an F-AHP (Fuzzy Analytical Hierarchy Process) based multi-attribute framework to prioritize the affecting parameters and assign rankings to the CPP alternatives. The CPP’s recommended by experts for this study are RDF-CPP (Refused Derived Fuel CPP), CF-CPP (Coal Fired CPP) and WHR-CPP (Waste Heat Recovery CPP). The factors affecting the decision of selecting the optimum CPP are prioritized by the experts using our F-AHP approach. Real world quantitative data is extracted from different online resources and financial reports of cement companies in Pakistan. The F-AHP model is flexible enough to deal with a variety of inputs including qualitative scales, crisp values and standard fuzzy numbers. The model is solved and a sensitivity analysis is performed in respective software. This study shows that non-conventional CPPs are highly demanded for cement
industry in Pakistan and while selecting these CPPs, management gives high priority to factors like ‘automation’ and ‘environment’ whereas associated ‘initial cost’ is not given much weight in decision making. In concluding ranking list, WHR-CPP is at the top and CF-CPP is at the bottom. This study may facilitate decision makers of cement industry in Pakistan and international CPP manufacturers alike in their forthcoming strategic decisions.