An energy efficient health-care asset replacement model including multiple asset types

In this paper, we provide an integer programming model that addresses perceived shortcomings in existing parallel replacement models, and attempt to present a more realistic solution. First of all, we consider two different types of assets, one that is fully functional and one that is cheaper, but offers limited functionality, while replacement literature has mainly focused on single type assets. Second, we incorporate budget limitations into our integer programming model and then aim to appease a majority of the demand while enforcing a penalty value for each unmet demand. Third, our model includes technological change in the form of increased capacity, and deterioration in the form of lower capacity, lower re-sale value and increased operations and maintenance (O&M) costs. We assume that no assets are kept idle. Furthermore, we apply our methodology to magnetic resonance imaging machines.