Green supply chain network optimization and the trade-off between environmental and economic objectives

Growing public pressure, stricter environmental standards but also the awareness that greener supply chains can be more attractive for investors have made it more important than ever for firms to go ‘green.’ While scholars have investigated technological production options, recycling and logistics flows, there is no research that studies the interplay between emissions and the costs of the supply chain contingent upon the production volume allocation and the energy mix. The results, based on a case study in the German automotive industry, show that by optimizing the energy mix, the CO2 emissions of the supply chain can be reduced by 30% at almost zero variable cost increase.