The Moscow-Ankara Energy Axis and the Future of EU-Turkey Relations

FEUTURE Online Paper No. 5 The Turkey-Russia-EU energy triangle is a relationship of interdependence and strategic compromise. However, Russian support for secessionism and erosion of state autonomy in the Caucasus and Eurasia has proven difficult to reconcile for western European states despite their energy dependence. Yet, Turkey has enjoyed an enhanced bilateral relationship with Russia, augmenting its position and relevance in a strategic energy relationship with the EU. The relationship between Ankara and Moscow is principally based on energy security and domestic business interests, and has largely remained stable in times of regional turmoil. This paper analyses the dynamics of Ankara-Moscow cooperation in order to understand which of the three scenarios in EU-Turkey relations - conflict, cooperation or convergence - could be expected to develop bearing in mind that the partnership between Turkey and Russia has become unpredictable. The intimacy of Turkish-Russia energy relations and EU-Russian regional antagonism makes transactional cooperation on energy demand the most likely of future scenarios. A scenario in which both Brussels and Ankara will try to coordinate their relations with Russia through a positive agenda, in order to exploit the interdependence emerging within the “triangle”

Financial Hedging and Optimal Procurement Policies under Correlated Price and Demand

We consider a firm that procures an input commodity to produce an output commodity to sell to the end retailer. The retailer's demand for the output commodity is negatively correlated with the price of the output commodity. The firm can sell the output commodity to the retailer through a spot, forward or an index-based contract. Input and output commodity prices are also correlated and follow a joint stochastic price process. The firm maximizes shareholder value by jointly determining optimal procurement and hedging policies. We show that partial hedging dominates both perfect hedging and no-hedging when input price, output price, and demand are correlated. We characterize the optimal financial hedging and procurement policies as a function of the term structure of the commodity prices, the correlation between the input and output prices, and the firm's operating characteristics. In addition, our analysis illustrates that hedging is most beneficial when output price volatility is high and input price volatility is low. Our model is tested on futures price data for corn and ethanol from the Chicago Mercantile Exchange. © 2017 Production and Operations Management Societ

Crowdfunding for financing wearable technologies

We explore electronic crowdfunding platforms as a means of receiving money and other resources by an entrepreneur from many parties for financing wearable technology project. The electronic platform determines the cost of funding for the entrepreneur and the return investors will receive per period. This research aims to develop a framework to understand and evaluate the quantitative and qualitative implications of various crowdfunding platforms for the entrepreneur and his investment decisions in wearable technologies. We consider a debt financing based platform and examine its operational implications on the entrepreneur's decisions. In addition, we identify the incentive problems that occur in these models. © 2016 IEEE

Organization and functioning of liberalized electricity markets: An overview of the Dutch market

Abstract In this paper, we examine the organization and the functioning of the Dutch electricity market. First we describe the organization of the Dutch electricity supply chain and the role of the main market participants including the transmission system operator, distribution system operators, program responsible parties and metering companies. We then describe the organization of financial trading and clearing mechanism of electricity through the organized futures exchange (The European Energy Derivatives Exchange), and the spot market (Amsterdam Power Exchange) which includes the day-ahead market and intra-day markets. We also detail the functioning of the imbalance market and reserve capacity management in the Netherlands. Through a set of numerical analysis, we provide an exploratory analysis of the APX day-ahead spot prices and the real-time imbalance prices using electricity price data from 2002 to 2013. We observe the price spikes both in the day-ahead and imbalance markets usually occur around 6-10 AM and 5-7 PM. We also observe that in the imbalance market system overages happen significantly more often than shortages pointing out that the market tends to buy more than what is demanded. This could be explained by the risk attitude of the market participants in the imbalance market. © 2015 Elsevier Ltd

Purchase order finance: A conceptual model with economic insights

Purchase Order (PO) finance is a form of financial intermediation which can alleviate capital constraints in certain supply chains. PO finance is typically utilized by small and medium-sized enterprises (SMEs) that operate as importers, exporters, wholesalers, or distributors and have high sales growth. When applicable, PO finance creates value for the supply chain by providing capital that is not available through regular lending channels, due to informational problems. We provide a conceptual model that clarifies the value proposition of PO finance and describe how the transactions are carried out in practice. The conceptual model allows us to highlight the settings where economic conditions will favor the application of PO finance

Supporting hurricane inventory management decisions with consumer demand estimates

Matching supply and demand can be very challenging for anyone attempting to provide goods or services during the threat of a natural disaster. In this paper, we consider inventory allocation issues faced by a retailer during a hurricane event and provide insights that can be applied to humanitarian operations during slow-onset events. We start with an empirical analysis using regression that triangulates three sources of information: a large point-of-sales data set from a Texas Gulf Coast retailer, the retailer's operational and logistical constraints, and hurricane forecast data from the National Hurricane Center (NHC). We establish a strong association between the timing of the hurricane weather forecast, the forecasted landfall position of the storm, and hurricane sales. Storm intensity is found to have a weaker association on overall inventory decisions. Using the results of the empirical analysis and the NHC forecast data, we construct a state-space model of demand during the threat of a hurricane and develop an inventory management model to satisfy consumer demand prior to a hurricane making landfall. Based on the structure of the problem, we model this situation as a two-stage, two-location inventory allocation model from a centralized distribution center that balances transportation, shortage and holding costs. The model is used to explore the role of recourse, i.e., deferring part of the inventory allocation until observing the state of the hurricane as it moves towards landfall. Our approach provides valuable insights into the circumstances under which recourse may or may not be worthwhile in any setting where an anticipated extreme event drives consumer demand. © 2016 Elsevier B.V

Manufacturing and Supply Chain Flexibility: Building an Integrative Conceptual Model Through Systematic Literature Review and Bibliometric Analysis

The purpose of this study is twofold: first, to establish the current themes on the topic of manufacturing and supply chain flexibility (MSCF), assess their level of maturity in relation to each other, identify the emerging ones and reflect on how they can inform each other, and second, to develop a conceptual model of MSCF that links different themes connect and highlight future research opportunities. The study builds on a sample of 222 articles published from 1996 to 2018 in international, peer-reviewed journals. The analysis of the sample involves two complementary approaches: the co-word technique to identify the thematic clusters as well as their relative standing and a critical reflection on the papers to explain the intellectual content of these thematic clusters. The results of the co-word analysis show that MSCF is a dynamic topic with a rich and complex structure that comprises five thematic clusters. The value chain, capability and volatility clusters showed research topics that were taking a central role in the discussion on MSCF but were not mature yet. The SC purchasing practices and SC planning clusters involved work that was more focused and could be considered more mature. These clusters were then integrated in a framework that built on the competence–capability perspective and identified the major structural and infrastructural elements of MSCF as well as its antecedents and consequences. This paper proposes an integrative framework helping managers keep track the various decisions they need to make to increase flexibility from the viewpoint of the entire value chain

Forming and scheduling jobs with capacitated constraints in semiconductor manufacturing: single machine problem

We study a scheduling problem motivated by the challenges observed in the newest semiconductor manufacturing wafer fabrication facilities. As wafers are larger and heavier in these wafer fabs, it is becoming more common to use specialized material handling containers that carry multiple orders coming from different customers and to schedule the containers as jobs in the fab. The system performance is a function of the completion times of orders, which ultimately depend on both (1) how the orders are assigned to such containers ("job formation"), and (2) how the containers are scheduled in the fab ("job scheduling"). The overall problem is to find the best way to form and schedule the jobs subject to complicating constraints, including the restrictions on the number of containers that can be used at one time and on the number of wafers the containers can carry. We focus on the single machine job formation and scheduling problem with the total completion time objective. We show that this problem is quite different from conventional parallel and serial batching scenarios and prove that the uncapacitated special case is polynomially solvable and the capacitated case is strongly NP-hard. We use a dynamic programming algorithm to solve the uncapacitated problem, which not only provides tight lower bounds for the capacitated problem, but also becomes a basis for a heuristic approach for the capacitated problem. The computational results show that this approach is very effective, leading to small optimality gaps that get even smaller as the problems become larger

Forming and scheduling jobs with capacitated constraints in semiconductor manufacturing: single machine problem

We study a scheduling problem motivated by the challenges observed in the newest semiconductor manufacturing wafer fabrication facilities. As wafers are larger and heavier in these wafer fabs, it is becoming more common to use specialized material handling containers that carry multiple orders coming from different customers and to schedule the containers as jobs in the fab. The system performance is a function of the completion times of orders, which ultimately depend on both (1) how the orders are assigned to such containers ("job formation"), and (2) how the containers are scheduled in the fab ("job scheduling"). The overall problem is to find the best way to form and schedule the jobs subject to complicating constraints, including the restrictions on the number of containers that can be used at one time and on the number of wafers the containers can carry. We focus on the single machine job formation and scheduling problem with the total completion time objective. We show that this problem is quite different from conventional parallel and serial batching scenarios and prove that the uncapacitated special case is polynomially solvable and the capacitated case is strongly NP-hard. We use a dynamic programming algorithm to solve the uncapacitated problem, which not only provides tight lower bounds for the capacitated problem, but also becomes a basis for a heuristic approach for the capacitated problem. The computational results show that this approach is very effective, leading to small optimality gaps that get even smaller as the problems become larger

Water, Energy and Environment Nexus

The water-energy-environment nexus focuses on the natural and technical phenomenon at a system level, suggesting that water, energy and environment rely on each other. The nexus as an analytical tool supports scientific research and is being increasingly embraced as a governance framework by politicians and decision-makers. Under the increasing impacts of the climate change, the energy sector and companies both influence and are being influenced by environmental politics and policymaking. Environmental policymaking, on the other hand, is closely linked to international agreements, such as the Paris Agreement, regulations such as the EU’s Green Deal, and increasing social pressure. This chapter reviews the nexus approach and its impacts on policymaking, arguing that water, environment and energy issues should be evaluated as a whole. In this respect, this chapter provides a framework for the book, in which the nexus issues are discussed based on case studies selected from the Eurasia region.Kapadokya Üniversites