Abstract: Aiming at a hybrid manufacturing/remanufacturing enterprise, considering both capital and emissions constraints, a nonlinear programming model is formulated under the carbon credits buy-back strategy and solved by using Kuhn-Tucker conditions. Meantime, a numerical example is provided to show that critical values of the carbon price and emissions increments of unit new product jointly define a few different decision regions under the carbon credits buy-back strategy. And production decisions are also affected by carbon quotas, while the carbon price has more obvious controlling effects on production decisions and total carbon emissions. Moreover, there exists a unique emissions incremental value of unit new product to enable total profit to be optimum when the carbon emissions of unit remanufactured product remain unchanged.

Key words: carbon credits buy-back, emissions constraint, capital constraint, manufacturing/remanufacturing decisions