Construction cost

Overall, use of learning systems has two main advantages. First, the construction cost may be lower, certainly if the system is not construeted from scratch but uses existing software tools and components. Second, a learning system is able to adapt to changing conditions, though not always on-line. 

An Example of Functional Notation Suppose that a storage warehouse of 16,000 fF is required. The construction costs per square foot are 10, 3, and 2 for walls, roof, and floor respectively. What are the minimum cost dimensions Thus, with h = height, x = width, and y = length, the respective costs are... 

Cost Indices The value of money will change because of inflation and deflation. Hence cost data can be accurate only at the time when they are obtained and soon go out of date. Data from cost records of equipment and projects purchased in the past may be converted to present-day values by means of a cost index. The present cost of the item is found by multiplying the historical cost by the ratio of the present cost index divided oy the index applicable at the previous date. Ideally each cost item affected by inflation should be forecast separately. Labor costs, construction costs, raw-materials and energy prices, and product prices all change at different rates. Composite indices are derived by adding weighted fractions of the component indices. Most cost indices represent national averages, and local values may differ considerably. 

Table 9-42 presents information on some cost indices for the United States. Engineering News-Record updates its construction-cost index in March, June, September, and December. The Oil and Gas Journal gives the Nelson-Farrar refinery indices in the first issue of each quarter. The Chemical Engineering plant-cost index and Marshall and Swift equipment-cost index are given in each issue of the pubhcation Chemical Engineering. Derivation of the base values is referred to in the respective publications. 

A study has been made by A. V. Bridgwater [Chem. Eng., 86, 119-121 (Nov. 5, 1979)] of the geographical variations in capital costs. He concluded that because of trade and competition basic equipment costs do not vaiy significantlv in the industrialized countries of the western world. The main differences in construction costs at various international locations are due to variations in labor costs and productivity, the use of specialized equipment, and sundry local factors. Table 9-55 gives location factors for the construction of chemical plants of similar function in various countries (1993 values). The factors have been corrected by Bridgwater for location variations in labor costs and efficiency and converted at the average value of the exchange rate. 

Overseas Construction Costs Although Table 9-55 gives location factors for the construction of chemical plants of similar function in various countries at 1993 values, these may vaiy differentially over a period of time owing to local changes in labor costs and productivity. Hence, it is often necessaiy to estimate the various components of overseas construction costs separately. Equipment and material prices will depend on local labor costs and the availability of raw materials. If the basic materials have to be imported, costs in the source area become important and import duties and freight charges must be added. 

Table 9-63 uses the data of Fig. 9-44 to compare the relative fixed-capital costs for plant constnic tion in other countries with those for the United States. The relative cost ratios were developed from data similar to those in Table 9-62. Labor ratios were corrected for the different local rates and hours per working week, job duration, and degree of mechanization available in other countries. Some of these factors are difficult to estimate, and the final total ratios give a reasonable order-of-magnitiide value for relative construction costs for equivalent plants in the countries indicated.

TABLE 9-63 Relative Plant Construction Costs in Various Countries Compared with the United States... 

This type of clarifier is used in apphcations such as prehminaiy oil-water separations in refineries and clarification of waste streams in steel mills. When multiple units are employed, common walls are possible, reducing construction costs and saving on floor space. Overflow clarities, however, generally are not as good as with circiilar clarifiers, due primarily to reduced overflow weir length for eqmvalent areas. 

Factors that enter into any economic analysis of handhng-warehousing systems are (1) expected mechanical and economic life of the system (2) annual maintenance cost (3) capital requirements and expected return on investment (4) building-construction cost and land v ue (5) detailed analysis of each work position (to determine trade-offs of labor and equipment expected future costs and availability of labor are important) (6) relation of system control and personnel used in system (trade-offs of people versus mechanical control) (7) type of information system (computerized or manual) and (8) expected changed in product, container, unit pallet loads, and customer preferences during the life of the system. 

The cost and economics of cathodic protection depend on a variety of parameters so that general statements on costs are not really possible. In particular, the protection current requirement and the specific electrical resistance of the electrolyte in the surroundings of the object to be protected and the anodes can vary considerably and thus affect the costs. Usually electrochemical protection is particularly economical if the structure can be ensured a long service life, maintained in continuous operation, and if repair costs are very high. As a rough estimate, the installation costs of cathodic protection of uncoated metal structures are about 1 to 2% of the construction costs of the structure, and are 0.1 to 0.2% for coated surfaces. 

In order to carry out a cost comparison of cathodic protection with the prolongation of service life of pipelines that it provides, the construction costs and the material costs of the pipeline have to be known. If there are no particular difficulties (e.g., having to lay the pipe in heavily built-up areas, river crossings, or rocky soil), the construction costs for a high-pressure DN 600 pipeline are about 10 DM km". If it is simply assumed that a pipeline has a useful life of 25 years without cathodic protection whereas with cathodic protection it has a life of at least 50 years, the... 

The structural costs of impressed current protection of harbor and coastal structures are about 1.5 to 2.5% of the total cost of the object to be protected. As an example, for the installation of a cathodic protection station in a tanker discharge jetty, the construction costs amounted to 2.2% of the total costs. The annual cost of current, maintenance, testing, and repairs amounted to 5% of the construction costs of the cathodic protection [22]. 

The usual estimating technique is to collect equipment pricing information from other projects and correlate this data by size, weight, pressure rating, and/or materials of construction. Each piece must be adjusted for inflation to bring all costs to one base time. Adjusting costs for inflation is discussed later under the heading, " Construction Cost Indexes. ... 

Several sources (References 19. 20, 21, and 22) are available for estimating pumps and drivers to check in-house coiTelations or to fill in w here data is not available. Care must be exercised in using construction cost indexes to update the literature data. It would be w ise to calibrate the indexes and literature data by getting vendor prices on a few of the larger, more expensive pumps, and 5% or 10% of the common types of pumps in the project being estimated. 

Once the cost of each piece of major equipment is known, it must be adjusted by construction cost indexes. Due to inflation and changing competitive situations, the price of equipment changes from year to year (Reference 26). Fortunately, there are several indexes that help in estimating today s costs based on historical data. Some of these indexes are Nelson Refinery Construction Cost... 

Bridgwater, A. V., International Construction Cost Location Factors, Chemical Engineering, Nov. 5, 1979, pp. 119-121. 

Miller, C. A., Converting Construction Cost From One Country to Another, Chemical Engineering, July 2. 1979, pp. 89-93. 

Weather data for a number of years should be assembled for each community being studied. Particular attention should be given to such natural disasters as hurricanes, earthquakes, and floods, which often can be predicted from meteorological data. In certain locations these catastrophic events must be assumed to be probable and this increases construction costs. E.xtremely cold weather often hampers process plant operation and requires special construction features to protect equipment from freezing. Predominantly warm weather permits cheaper construction but may also reduce the efllcicncy of the labor force. 

Utility Data Institute. (1994). Electric Utility Power Plant Construction Costs. Washington DC Utility Data Institute. 

Like wave and OTEC power plants, one of the main barriers to the increased use of tidal energy is the initial cost of building tidal-generating stations. It has been estimated that the construction of the proposed facility on the Severn River in England would have a construction cost of 15 billion. 

The rig selection will dictate the basic layout of the pad. Based on the necessary area needed to support its functions, ancillary equipment may be added in space conservative measures. In addition to the placement of various stationary rig site components, other operations such as logging, trucking and subsequent completion operations must be provided for. The most environmentally sensitive design will impact the least amount of area, and in that it will be the most economic. Potential pad sites and access routes should be laid out on a topographic map prior to the actual survey. At this time, construction costs can be estimated and compared. Figure 4484 shows such a layout. The cost of building a location includes the cost of reclamation such as any remediation. 

Based Upon Cost Estimate Dated or Actual Construction Cost... 

Accounting, plant construction costs, 48 Cost accumulation, 49 Affinity laws, 201, 202, 203 Air Inleakage, vacuum systems, see vacuum systems Air pressure drop, table, 106 Chart, 114 Orifice flow, 107 Air, absolute viscosity, 132... 

Rindner et al, Preliminary Estimate of Concrete Thicknesses and Construction Costs of Laced Reinforced Concrete Structures , PATR 4441... 

Detailed (Quotation) estimates, accuracy 5-10 per cent, which are used for project cost control and estimates for fixed price contracts. These are based on the completed (or near complete) process design, firm quotations for equipment, and a detailed breakdown and estimation of the construction cost. 

The cost of materials and labour has been subject to inflation since Elizabethan times. All cost-estimating methods use historical data, and are themselves forecasts of future costs. Some method has to be used to update old cost data for use in estimating at the design stage, and to forecast the future construction cost of the plant. 

As a rough guide US costs can be taken as equivalent to local prices, converted to local currency, for Western European countries, but construction costs may be significantly greater in less developed parts of the world. 

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