Work-based steam pricing

Realizing the shortcomings in the enthalpy-based method, Kenney (1984) proposed to value steam based on the potential work that the steam possesses in comparison with enthalpy. Kenney pointed out that the enthalpy-based pricing method is based on the first law of thermodynamics (energy conservation), while the work-based pricing is based on the second law of thermodynamics (entropy). In thermodynamics, potential work is also termed as availability (a) implying the amount of potential work available. 

In a direct comparison with the enthalpy ratio used in the enthalpy-based method, in the work-based method, the ratio of the availability of the steam at lower pressure to the availability of the steam at the generation pressure is used  

Example 17.3 Work-Based Steam Cost Calculations 

Clearly, the steam prices show greater disparity compared with that of the enthalpy-based method (Table 17.3). The enthalpy-based steam pricing method 

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TABLE 17.3. Comparison Between Enthalpy and Work-Based Steam Pricing Methods... 

Both enthalpy and work-based steam pricing methods rely on thermodynamic laws as the basis. Cooper (1989) argued that the steam pricing should reflect economic reality. Since the operating cost for a steam system mainly consists of fuel burned for steam generation. Cooper (1989) proposed to use the concept of fuel equivalent (FE) as the basis for steam pricing. In this method, the ratio of FE for steam at different pressures is used to derive the steam prices in placement of the ratios of enthalpy and availability. 

Calculate the steam prices based on the work-based method for the same steam system (Figure 17.1). 

The critical question for enthalpy-based, work-based, and FE-based stem pricing methods is Do the steam prices from these methods reflect the true costs The question can be answered the best with the following example. 

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