Erins Energy Plan

Study Case 6 : Operations Management

“Erin’s  Energy  plan”

Group 6:

1. Amelia Nurunnisa (1106059865)

2. Marsha Maharani (1106059732)

I.

Overview

The financial status of Waylan Industries were not looking good. The latest figures

had shown that profits were down inspite of increased sales because the cost of

production was to high and it had consequently reduced profitability by a huge margin.

It was also determined that the exponential jump in energy prices by as much as 250

percent had resulted in the high energy costs the company had incurred.

Waylan Industries want to develop an aggregate plan. Data that relate to

production, demand, capacity, and cost are shown in table below.

Spring

1.500

Demand

Capacity:

Coal

Natural Gas

Petroleum

Electricity (Local Utility)

Electricity (Nearby Utility)

Type of Energy

Coal

Natural Gas

Petroleum

Electricity (Local Utility):

Spring

Summer

Fall

Winter

Electricity (Nearby Utility):

Spring

Summer

500

1.000

1.000

2.000

2.000

Sales Period

Summer

Fall

5.000

5.000

500

1.000

1.000

2.000

2.000

Cost per Million BTUs

$

8

$

32

$

46

Winter

10.000

500

1.000

1.000

2.500

2.500

500

1.000

1.000

2.500

2.500

Holding Cost

$

2,4

$

9,6

$

9,2

$

$

$

$

20

40

24

70

0

0

0

0

$

$

22

44

0

0

1

Fall

Winter

II.

$

$

26

75

0

0

Analysis

Demand For

Supply From

Spring

Coal

Natural Gas

Spring

Petroleum

Electricity

(Local

Utility)

Electricity

(Nearby

Utility)

Coal

Natural Gas

Summer

Petroleum

Electricity

(Local

Utility)

Electricity

(Nearby

Utility)

Coal

Natural Gas

Fall

Petroleum

Electricity

(Local

Utility)

Electricity

(Nearby

Utility)

$

Summer

8

$

10,4

Fall

$

Winter

12,8

$

15,2

Unused

Capacity

0

500

$

$

$

500

32

46

20

$

$

22

41,6

55,2

$

1.000

$

Total

Capacity

Available

(supply)

20

$

$

51,2...