Unisoma develops Energy Matrix Optimization tool for one of Brazil’s largest companies

With the support of AIMMS’ robust and flexible platform, Unisoma was able develop a prototype of the SIMAE system in less than four months. Now a final version is in place to support CST’s planning process.

Business description

CST, the world leader in the steel slab market, is self-sufficient with respect to its electricity needs, which it meets using gas-fired power plants. These power plants are fuelled by a mixture of by-products from the coke and steel making processes (tar and Coke Oven Gas (COG), and Blast Furnace Gas (BFG) and Linz Donawitz Gas (LDG), respectively). Cryogenic plants use the electrical energy to produce oxygen, nitrogen, and argon – in liquid or gaseous state. These products are then used in the coke and steel making processes inside the plant.

In an integrated steel plant such as CST’s, the energy balance (generation, consumption, buying and selling) is very dependent on the raw materials, by-products and other inputs. For instance, a reduction in pig iron production causes a decrease in the availability of BFG, used in the generation of power. Achieving the optimum balance in the energy matrix of a steel plant is therefore a complex and dynamic problem.

Occasional imbalances in the electricity markets can create interesting opportunities. During the Brazilian energy crisis of 2002 for example, when a shortage of production capacity caused skyrocketing electricity prices, CST was able to obtain extra revenues by selling part of its electricity production on the open market.

click to enlargeThe challenge

Prior to its involvement with Unisoma, CST’s energy matrix planning was supported purely by spreadsheet calculations. Given the complexity of the problem, and the fact that the time required to generate solutions was very lengthy, the top management recognized the potential in applying an optimization tool as an alternative.

The solution

To support CST’s planning process, Unisoma developed SIMAE, an AIMMS-based system. Based on generic process and product representation, SIMAE determines the daily optimal levels for:

  • Processes with a direct or indirect influence on the energy balance
  • Selling and buying raw-materials, by-products and utilities
  • Inventory policies

The Benefits

The usage of SIMAE improved the performance of planning activities in more than 75% (30 minutes for a complete plan) and actually supports CST’s expansion analysis by giving a flexible scenario comparison feature.

How did AIMMS add value?

With the support of a robust and flexible platform such as AIMMS, Unisoma was able to develop a prototype of the SIMAE system in less than four months. Based on the speed and success of this first phase, CST’s top management approved the next phase of the project which consisted of enhancing the capabilities of the prototype and rolling out a final version.

Customer Quote

“SIMAE has been of great value in support of the planning and optimization of the energy matrix balance at CST. It also serves as a basis for determining maintenance schedules for several production resources”.

Alencar Avelar Scarpe

Production Planning Manager at the

Department of Metallurgy and Production Planning of CST

About Arcelor Brasil S.A. and CST

In 2005 Arcelor Brasil S.A. (an Arcelor Mittal subsidiary) was founded by the union of three Brazilian companies with a strong presence in the steel market: Companhia Siderúrgica Belgo-Mineira, Companhia Siderúrgica de Tubarão (CST) and Vega do Sul. The holding has an annual installed production capacity of 11 million tons of flat and long steel/year. It is among the largest steel companies operating in Latin America.

CST is a world leader in the steel slab market, responsible for 20% of worldwide sales volume, and is one of the largest companies in Brazil. Strategically located in the city of Vitória, the capital of Espírito Santos State, in eastern Brazil, CST has established itself as a supplier of high-quality semi-finished steel products (slabs and hot-rolled coils) for the automotive industry. To guarantee CST´S production capacity expansion from the current 5 million tons to 7.5 million tons of steel plates/year a new coke plant (called Sol Coqueria Tubarão) has been constructed, with a capacity to produce 1.5 million tons of coke/year.

About UniSoma Matemática para Produtividade

UniSoma, established in 1984, is a Brazilian consultancy company specializing in the development and implementation of integrated production and logistics planning solutions. UniSoma develops supply chain management (SCM) solutions, also known as Advanced Planning and Scheduling (APS), using multidimensional representations of physical, economic, and management attributes and constraints.

Corcerning the steel production area, UniSoma has been developing decision support solutions (coal supply planning, coke production sequencing, raw material mix for sintering plant and blast furnaces, strategic portfolio selection, etc) since 1989, working with Brazilian leading producers and main exporters.

PDF of this case study




Eduardo M. Milanez,  Unisoma’s AIMMS Service Partner Page, Unisoma’s Website



http://www.unisoma.com/br/index.php?pagina=cliente&cliente=cst (Portuguese)