Page 194 - Analysis, Synthesis and Design of Chemical Processes, Third Edition

The estimating procedures to obtain the full capital cost of the plant are described in this section. If an
estimate of the capital cost for a process plant is needed and access to a previous estimate for a similar
plant with a different capacity is available, then the principles already introduced for the scaling of
purchased costs of equipment can be used.
1. The six-tenths rule (Equation 7.1 with n set to 0.6) can be used to scale up or down to a new
capacity.
2. The Chemical Engineering Plant Cost Index should be used to update the capital costs (Equation
7.4).

The six-tenths rule is more accurate in this application than it is for estimating the cost of a single piece of
equipment. The increased accuracy results from the fact that multiple units are required in a processing
plant. Some of the process units will have cost coefficients, n, less than 0.6. For this equipment the six-
tenths rule overestimates the costs of these units. In a similar way, costs for process units having
coefficients greater than 0.6 are underestimated. When the sum of the costs is determined, these

differences tend to cancel each other out.

The Chemical Engineering Plant Cost Index (CEPCI) can be used to account for changes that result from

inflation. The CEPCI values provided in Table 7.4 are composite values that reflect the inflation of a mix
of goods and services associated with the chemical process industries (CPI).

You may be familiar with the more common consumer price index issued by the
government. This represents a composite cost index that reflects the effect of inflation
on the cost of living. This index considers the changing cost of a “basket” of goods
composed of items used by the “average” person. For example, the price of housing,
cost of basic foods, cost of clothes and transportation, and so on, are included and
weighted appropriately to give a single number reflecting the average cost of these
goods. By comparing this number over time, it is possible to get an indication of the

rate of inflation as it affects the average person.

In a similar manner, the CEPCI represents a “basket” of items directly related to the costs associated with
the construction of chemical plants. A breakdown of the items included in this index was given in Table
7.5. The index is directly related to the effect of inflation on the cost of an “average” chemical plant, as
shown in Example 7.7.

Example 7.7

The capital cost of a 30,000 metric ton/year isopropanol plant in 1992 was estimated to be $23 million.
Estimate the capital cost of a new plant with a production rate of 50,000 metric tons/year in 2007 (assume
CEPCI = 500).

Cost in 2007 = (Cost in 1992)(Capacity Correction)(Inflation Correction)

0.6
= ($23,000,000)(50,000/30,000) (500/358)