Economic risk

The development section serves as an intermediary between laboratory and industrial scale and operates the pilot plant. A dkect transfer from the laboratory to industrial-scale processes is stiH practiced at some small fine chemicals manufacturers, but is not recommended because of the inherent safety, environmental, and economic risks. Both equipment and plant layout of the pilot plant mirror those of an industrial multipurpose plant, except for the size (typically 100 to 2500 L) of reaction vessels and the degree of process automation. 

The annual economic risk of operating this unit is estimated to be 1 million because of fire and explosion accidents. 

The DPSE found an acceptably low risk that was dominated by releases during normal operation. The mean risk of the station was estimated to be 9E6 Sv/y to the individual at ihe sue boundary and 7E4 person-Sv/yr to the surrounding population to a distance of 100 km. The consequences of events beyond the design basis were not calculated but their frequency was predic(cd to be 4E-6 /rcactor-y which is acceptably low. The mean economic risk was estimated to be about 10 M /reactor-yr. 

The Pickering risk is estimated to be 2E-4 Sv/y to an individual at the site boundary and about 4L-.i person-Sv/y to the surrounding population. Both of which are less than DPSE in spite of age of station, the higher demographics, and the inclusion of beyond design basis events. The mean site economic risk was estimated to be 1.5 M /reactor-y,... 

The first step of a "What If analy sis is to define the study boundaries. There arc two types of study boundaries to be considered the consequence category boundmy, which includes public risk, employee risk, and economic risk, and the physical boundaiy which addresses the section of the plant that should be considered for analysis. 

Depending on the depth of the well, this time lag can consume valuable time needed to address the problem—either technical or geological—before it becomes worse and/or causes drilling operations to stop. Drilling a well involves all types of technical, geological, and economic risks. The greatest economic risk occurs when drilling operations must be... 

A review of those procedures, which were developed in companies to assess and deal with economic risks (risk management) reveals ways of applying them to the processes for dealing with social, health and ecological risks. 

But even a small-scale trial-and-error strategy has to be organised within society. As discussed in the previous section, iimovations are rather improbable and disadvantaged by stractural frameworks. Iimovations depend upon freedom for them to be developed. At the same time safety barriers have to be formulated within which the search process can move freely. For example, possible environmental effects must be anticipated, necessitating controlled release in small increments and retrievability must be ensured. (Quantitative and qualitative restrictions must be imposed so that retrieval and repair options can still be effective if a trial is aborted. This approach is more successful if the persistence and spatial range of a chemical is low than for persistent chemicals like CFCs and PCBs. This requires that limited Teaming spaces or experimentation spaces have to be created intentionally under technical and economic risk considerations. Small increments and a steady increase are to be preferred, accompanied by intensive monitoring of detectable consequences. 

Figure 6.3 Risk Model II plot of expected profit for different levels of risk as represented by the economic risk factor 0n and the operational risk factor 02.

While the past methods of preventing hydrate plugs have been to use avoidance with thermodynamic inhibitors such as methanol or glycols, our new understanding of how plugs form, allows us to propose economic risk management (kinetics) to avoid hydrate formation. These concepts differ in type for oil-dominated and gas-dominated systems. 

In the future, economic risk evaluation will guide the hydrate-plugging prevention philosophy. It is important to note that phase equilibria thermodynamics provide the current paradigm of hydrate avoidance, but risk management is in the domain of time-dependent phenomena or physical hydrate kinetics. The experience base with hydrate plugs and their remediation impacts the economic need for large amounts of insulation and/or thermodynamic inhibitors. 

Erb, Harvey and Viscanta Expected Returns and Volatility in 135 Countries. The Journal of Portfolio Management, Spring 1996. Cf also by the same authors Political Risk. Economic Risk, and Financial Risk. Financial Analysts Journal, November/December 1995, and Do World Markets Still Serve as a Hedge The Journal of Investing, Fall 1995. 

In cooperation with the government, programs are being established to move H-Coal and other technologies to the final stage of commercial development. Much work still remains, especially the resolution of economic risks, but there is a definite momentum building that can provide the necessary environment for a number of important projects to move forward in a timely manner. 

---