Capital cost indices

Capital cost indicator is defined as the 18% of total capital cost for the hydrogen production and utilization elements. For each option the total capital cost is obtained forms the scale down of the hydrogen system as they are defined in the evaluation of larger system. 

More than 40 capital cost indices have been developed. These include... 

The saving of energy, without taking any regard of capital cost, indicates that about 40% saving by way of the extraction and the recompression routes and about 25% for multiple effect distillation. 

As an example, the battery-limits capital cost can be estimated for the production of 10,000 t/yr of ethylene (qv) from ethanol (11). Seven processing blocks, ie, vaporizer, reactor, water quench, compressor, dryer, distillation, and energy recovery, can be identified. The highest temperature is 350°C (reactor), and the highest pressure is about 1.7 MPa (17 atm) (compressor, two towers). If a materials-pressure factor, + of 1.03 is assumed, then for N = 7 0 = 0.87 1/0 = 1 64 and f =0 K = 6.3. This gives the 1981 cost as 4.4 X 10 . The 1991 battery-Hmits investment can be obtained, by updating with the CE Plant Cost Index, as 5.3 x 10 . ... 

The value of the index n is traditionally taken as 0.6 the well-known six-tenths rule. This value can be used to get a rough estimate of the capital cost if there are not sufficient data available to calculate the index for the particular process. Estrup (1972) gives a critical review of the six-tenths rule. Equation 6.2 is only an approximation, and if sufficient data are available the relationship is best represented on a log-log plot. Garrett (1989) has published capital cost-plant capacity curves for over 250 processes. 

In addition to their ability to capture the multidimensionality of batch operations, another advantage of mathematical programming techniques is the flexibility and adaptability of the performance index, i.e. the objective function. In a design problem, the objective function can take a form of a capital cost investment function. In a scheduling problem it can be minimization of makespan, maximization of throughput, maximization of revenue, etc. In this chapter, the objective function will either... 

Figure B.4 displays four well-known cost indexes for capital costs from 1950 to 1999 ...

If you need historical values for the cost of specific types of equipment, materials, fuels, and so on, rather than a general index, consult the references cited at the beginning of the chapter. To determine capital costs (Cx) in the year X in the future, given a known cost Cy in year Y, you simply multiply Cy by the ratio of the index (Ix/Iy) ... 

Labor costs experience inflation just as do capital costs as Figure B.5 demonstrates. Raw materials and fuel costs are subject to considerable erratic fluctuations as demonstrated by oil and metals prices, which have rapidly risen and fallen several times over the last five decades. For example, Figure B.6 shows the changes in refinery fuel price index since 1955. Prediction of refinery fuel prices in the future is clearly much more difficult than predicting capital costs. 

The distribution cost index combines variable transportation and warehousing costs as well as capital costs for local and transit inventories. 

The benefits of LPRM techniques are that the corrosion rates are instantaneous and also provide a pitting index measurement. The capital costs of LPRM equipment can be quite high, especially if several probes and monitors are required, but the probes can be reused and thereafter easily fitted with replacement electrodes. 

The ratio method is a simple technique whereby known capital cost data for an existing chemical plant are adjusted to provide a cost estimate for the desired plant capacity. This method is also able to update figures to account for inflationary effects of past years. Finally the capital cost figure is adjusted for exchange rate differences between countries. The method is centred around the use of key cost estimation indices such as the CE Plant Cost Index and the Marshall and Stevens (M S) Index. 

The method used is outlined in Ref. CE9 (Chapter 4). The capital cost estimate is adjusted to the correct plant capacity by applying a scaling index. The appropriate scaling index for nitric acid plants is 0.6 (Ref. CE9 Table 19, p.184). Therefore ... 

The present index is evaluated using a formula that applies a weighting for the various capital cost components. The weighting scheme is shown below ... 

Ernst et al.5 indicate that the Super Pro Designer contains models to help estimate the direct fixed capital cost based on 1995 dollars. These numbers may be suitably updated using the current CPI or other suitable index. Maintenance cost were set at 25% of the purchase cost of the equipment per year. Laboratory costs were allocated to capital costs. Labor costs were carefully calculated based on number of operator hours per equipment hour. This was done after analyzing scheduling of the entire process as well as noting that the operator time on each equipment was reasonable. 

Selecting the right escalation index is often difficult, as different published indices can appear to be applicable. For instance, when escalating the capital cost of a refinery hydrosulfurization unit, should one use the CEPCI, the Nelson-Farrar Refinery Index, or a combination of the two indexes The decision often rests as much on engineering judgment as it does on hard data. 

Approximate fixed capital cost with the chemical engineering plant cost index = 420. bS/T shell and tube. 

METHOD F investment COST PER UNIT OF CAPACITY. Many data have been published giving the fixed-capital investment required for various pro-eesses per unit of annual production capacity such as those shown in Table 19. Although these values depend to some extent on the capacity of the individual plants, it is possible to determine the unit investment costs which apply for average conditions. An order-of-magnitude estimate.of the fixed-capital investment for a given process can then be obtained by multiplying the appropriate investment cost per unit of capacity by the annual produetion eapaeity of the proposed plant. The necessary correction for change of eosts with time can be made with the use of cost indexes. 

Cost factors in capital investment, 166-179 Cost indexes, 163-166 Cost of equipment blenders, 556-558 blowers, 531 boilers, 809... 

The US EPA published information on capital cost of constructing sludge lagoons. Using an ENR CC Index equal to 6390.21 (January 2002 Cost), typical excavation and liner costs associated with a two-bedroom residence are as follows ... 

Process Tech- nology Product Process Effi- ciency % Maturity Accuracy Index Capital cost k /TJ annum capacity 100% utilisation ie. C Opportunity cost/ GJ ie. A Feedstock price range /GJ ie. B Comment Ref. 

This value disagrees with Wiggins estimate, 144 million in1990 dollars, As discussed by Woltman (524) and DiMasi et al. (109), Wiggins made an error in calculating the total capitalized cost. OTA S re-estimate, 123.4 million, is slightly lower than DiMasi s recalculation, 124.7 million in 1990 dollars, because of differences in price indexes used. 

---