Manufacturing Scheduling for Energy Cost Reduction Under Real Time Pricing Scheme

In this study we explore the possibility of reducing electricity cost of a manufacturing facility subject to real time pricing of electricity by changing operation schedules while maintaining a pre-determined production throughput. To start, a time series model is developed to forecast the hourly electricity price and time-index integer programing is used to determine the manufacturing schedule. The electricity price forecast is updated every hour based on the price history, which requires updated manufacturing schedule. A hypothetical flow shop with 3 processes operating from 8 am to midnight is used as a case study. The shop has limited buffer between processes and all the machines in the shop have three operational states i.e. on, off, and idle. With the throughput of 60 work pieces, the results suggest that it is possible to reduce the cost by 3% comparing with schedule based on day-ahead price forecast.