The Pollution-Routing Problem

► Minimizing emissions does not imply minimizing operational costs in vehicle routing. ► CO 2 emission cost estimates do not seem to be as important as fuel or labor costs. ► High variation in customer demand implies more room for reducing energy. ► The use of fewer vehicles generally implies lower fuel consumption. The amount of pollution emitted by a vehicle depends on its load and speed, among other factors. This paper presents the Pollution-Routing Problem (PRP), an extension of the classical Vehicle Routing Problem (VRP) with a broader and more comprehensive objective function that accounts not just for the travel distance, but also for the amount of greenhouse emissions, fuel, travel times and their costs. Mathematical models are described for the PRP with or without time windows and computational experiments are performed on realistic instances. The paper sheds light on the tradeoffs between various parameters such as vehicle load, speed and total cost, and offers insight on economies of ‘environmental-friendly’ vehicle routing. The results suggest that, contrary to the VRP, the PRP is significantly more difficult to solve to optimality but has the potential of yielding savings in total cost.