Cost reduction contributing factors

The purpose of this article is to indicate and illustrate the very wide range of factors, apart from and beyond questions of underlying chemistry and chemical specificity, that determine or constrain the utility of various investigative efforts in catalyst research they also define the continuing and progressive contributions to the chemical industry which the catalyst chemist can make. The ultimate criteria are nearly always found in cost reduction and/or in product diversification and improvement. 

R D on basic factors which contribute further improving performance and cost reduction... 

From a point of view of industrial protein production the number of sequential operations necessary to achieve the desired purity of a protein contributes significantly to the overall costs of the downstream process. This is on one hand due to the capital investment and amount of consumables needed for each step as well as to the individual time requirements of each operation, as labour costs are a very important factor in the calculation of process economics. Secondly the overall yield of the purification is reduced with each additional process step, originating from its inherent loss of product. Furthermore, fast primary recovery should separate the protein of interest from process conditions detrimental to its structural stability, e.g. proteases, glycosidases, or oxidizing conditions. As the performance of the purification process, expressed by its overall yield, operation time, and capital cost may contribute to up to 80% of the total production costs [2], it is evident, that a reduction of the number of sequential steps in a purification protocol may be the key to the economic success of a potential protein product [3],... 

Raw material-cost reduction. High valorisation of raw materials is the factor with the strongest impact on process efficiency. In this respect, the breakthrough element is the chemistry. Here we mean also the development of more active and selective catalysts. Enhancing the selectivity of reactions can eliminate material and energy recycles and contributes significantly to massive cost reduction. The combination of reaction and separation steps in more compact devices eliminates intermediate costly separations, as in the case of novel processes based on reactive distillation or multifunctional reactors. 

There are a number of factors that will enter into situations similar to Acme s. The conditions just described are common. Instead of focusing entirely on the cost reduction benefit, an equivalent amount of time should be spent on strategic contributions. This avoids the trap described at the beginning of this chapter — having all cost reduction projects settle into the lower left-hand corner as shown in Figure 26.1. Such an analysis might also point to additional areas for financial benefits. 

Several factors motivated Nortel to produce the lead-free telephone, including public concern over the effect of lead on the human body and the defeated U.S. Lead Exposure Reduction Act in 1994. In addition, efforts in Europe to ban lead-containing electronics waste initiated by the Netherlands served as a driving force to develop the telephone [23]. Other contributing factors to Nortel s lead-free work included cost issues lead-free products would incur lower handling and disposal costs, and product end-of-life liability and disposal costs would be avoided. 

But for power station applications, the thermal efficiency is not the only measure of the performance of a plant. While a new type of plant may involve some reduction in running costs due to improved thermal efficiency, it may also involve additional capital costs. The cost of electricity produced is the crucial criterion within the overall economics, and this depends not only on the thermal efficiency and capital costs, but also on the price of fuel, operational and maintenance costs, and the taxes imposed. Yet another factor, which has recently become important, is the production by gas turbine plants of greenhouse gases (mainly carbon dioxide) which contribute to global warming. Many countries are now considering the imposition of a special tax on the amount of CO2 produced by a power plant, and this may adversely affect the economics. So consideration of a new plant in future will involve not only the factors listed above but also the amount of CO2 produced per unit of electricity together with the extra taxes that may have to be paid. 

In this study, the discount rate was set at 8%, the operational life of the plant was chosen at 30 years, and the load factor was taken as 80% without specific consideration for start-up or shutdown phases. The construction period was assumed to last for three years, which leads to adding an interest cost, along with other contributions such as general facilities and engineering and contractor fees, to the process unit investment cost mentioned above. The final investment cost for an Nth of a kind plant was calculated by considering a learning effect leading to a reduction of 30% of capital costs. 

The processes for manufacturing methanol by synthesis gas reduction and ethanol by ethylene hydration and fermentation are very dissimilar and contribute to their cost differentials. The embedded raw-material cost per unit volume of alcohol has been a major cost factor. For example, assuming feedstock costs for the manufacture of methanol, synthetic ethanol, and fermentation ethanol are natural gas at 3.32/GJ ( 3.50/10 Btu), ethylene at 0.485/kg ( 0.22/lb), and corn at 0.098/kg ( 2.50/bu), respectively, the corresponding cost of the feedstock at an overall yield of 60% or 100% of the theoretical alcohol yields can be estimated as shown in Table 11.12. In nominal dollars, these feedstock costs are realistic for the mid-1990s and, with the exception of corn, have held up reasonably well for several years. The selling prices of the alcohols correlate with the embedded feedstock costs. This simple analysis ignores the value of by-products, processing differences, and the economies of scale, but it emphasizes one of the major reasons why the cost of methanol is low relative to the cost of synthetic and fermentation ethanol. The embedded feedstock cost has always been low for methanol because of the low cost of natural gas. The data in Table 11.12 also indicate that fermentation ethanol for fuel applications was quite competitive with synthetic ethanol when the data in this table were tabulated in contrast to the market years ago when synthetic ethanol had lower market prices than fermentation ethanol. Other factors also... 

The ready availability of starch-based industrial wastes and their renewable nature merit their use as substrates for poly-betahydroxybutyrate (PHB) production from activated sludge. This would not only utilize the excess sludge generated and reduce the load on landfills, but would also contribute to reduction in the cost of PHB production by avoiding sterile conditions and pure carbon sources for maintenance and growth of pure cultures. PHB content is the most important factor affecting the production cost of PHB due to its effect on PHB yield and recovery efficiency, followed by cultural conditions and carbon substrates used (Khardenavis, 2007). 

Trying to reduce the severity of the injury is a post-contact safety control. Quick evacuation, prompt medical treatment, adequate medical facilities, and trained personnel all contribute to the reduction of the severity of the injury. The recuperation time after an injury depends on numerous factors. It also determines the number of shifts lost as a result of the accident. These losses in turn determine the total cost of the accident. 

The percentage of reduction in construction cost varies from project to project, since all factors contributing to the construction cost vary. 

Certain costs are associated with risk control measures. By estimating the risk reduction possible for each option, the costs and benefits for each option can be assessed and informed decisions can be made on which option should be selected. A good understanding of the factors contributing to risk (and of the frequency and consequences of potential hazardous events) through risk analysis is essential for this purpose. 

The operation without on-site refuelling and infrequent periodic inspections are factors contributing to the reduction of the operation and maintenance costs. The increase of a maintenance interval up to 10 years could be reasonable for operator-free reactors such as the RAPED because no moving mechanical parts are involved in their safety systems. 

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