Page 226 -

206 CHAPTER 4 LINEAR PROGRAMMING APPLICATIONS

Supplier Number of Tons Contracted For Cost ($/ton) BTUs/lb
RAG 350 000 22 13 000
Peabody Coal Sales 300 000 26 13 300
American Coal Sales 275 000 22 12 600

For example, the contract signed with RAG requires Cinergy to purchase 350 000 tons of coal at a price of $22
per ton; each pound of this particular coal provides 13 000 BTUs.
The data for the four variable-tonnage contracts follow:

Supplier Number of Tons Available Cost ($/ton) BTUs/lb
Consol, Inc. 200 000 32 12 250
Cyprus Amax 175 000 35 12 000
Addington Mining 200 000 31 12 000
Waterloo 180 000 33 11 300

For example, the contract with Consol, Inc., enables Cinergy to purchase up to 200 000 tons of coal at a cost
of $32 per ton; each pound of this coal provides 12 250 BTUs.
The number of megawatt-hours of electricity that each generating unit must produce and the heat rate
provided are as follows:

Generating Unit Electricity Produced (mWh) Heat Rate (BTUs per kWh)

Miami Fort Unit 5 550 000 10 500
Miami Fort Unit 7 500 000 10 200
Beckjord Unit 1 650 000 10 100
East Bend Unit 2 750 000 10 000
Zimmer Unit 1 1 100 000 10 000
For example, Miami Fort Unit 5 must produce 550 000 megawatt-hours of electricity, and 10 500 BTUs are
needed to produce each kilowatt-hour.
The transportation cost and the add-on cost in dollars per ton are shown here:
Transportation Cost ($/ton)

Miami Miami East
Fort Fort Beckjord Bend Zimmer
Supplier Unit 5 Unit 7 Unit 1 Unit 2 Unit 1
RAG 5.00 5.00 4.75 5.00 4.75
Peabody 3.75 3.75 3.50 3.75 3.50
American 3.00 3.00 2.75 3.00 2.75
Consol 3.25 3.25 2.85 3.25 2.85
Cyprus 5.00 5.00 4.75 5.00 4.75
Addington 2.25 2.25 2.00 2.25 2.00
Waterloo 2.00 2.00 1.60 2.00 1.60

Copyright 2014 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s). Editorial review has
deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it.