Ecotricity: An Optimal Investment Decision for Electric Highway Expansion
(6 pages of text)
Case (Pub Mat)
Ecotricity Group Ltd., founded in 1995, had grown to be a major renewable energy utility service provider in the United Kingdom. In 2016, the company wanted to expand its "electric highway"—a network of charging stations for electric vehicles along major U.K. motorways. The expansion plans involved two chargers: Type A chargers, installed in public locations along the motorway, and Type B chargers, installed in suitable home garages owned by Ecotricity customers. To meet the projected traffic flow of electric vehicles in the future, the company needed to optimally expand the number of both types of charging points in each highway zone.
This case uses integer programming to determine the optimal number of Type A and Type B chargers that Ecotricity should install to expand its electric highway. The solution is obtained by using Microsoft Excel Solver and interpreting the results. The case also provides a platform for discussing optimal investment strategies, and for considering another topic not emphasized extensively in the case—how an operational strategy affects image building.
The case is suitable for a core operations research or management science course in an MBA, executive MBA, or post-graduate program, in a module that addresses the use of integer programming and Microsoft Excel Solver for decision-making. It is assumed that students already know how to formulate and solve linear programming problems using Microsoft Excel Solver. The case prepares students to undertake the following:
- Use integer programming to formulate a network expansion strategy.
- Use Microsoft's Excel Solver to resolve the integer programming problems.
- Interpret the results from Microsoft Excel Solver to support decision-making.
United Kingdom, Medium, 2016
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