Abstract: Set covering method is applied to determine the location of gas station for network expansion. A novel gas station location model was built with variable coverage radius. A two-stage approximation greedy algorithm was proposed to determine the size and location of new gas station so that capacity balance between the new station and existing station was achieved. The uncertainty of major parameters was considered and solved well by using of Mont Carlo simulation. The ‘different areas with different coverage radius’ strategy was proposed. Computational results demonstrate that the proposed approach performed very well in keeping with the relationship between the refueling demand and the service capacity in the coverage area. It was adaptive better to the changes of population density and vehicle density in the planning area from city center to city periphery.

Key words: transportation planning and management, facility location problems, gas station network expansion, capacity balance, set covering model, variable coverage radius