Page 126 - Challenges in Corrosion Costs Causes Consequences and Control(2015)

104 CORROSION COSTS

On the basis of these data, coefficients in the IO model were adjusted. Data were
gathered from interviews with experts in the field, review of literature, and use of
technical judgment.
The total cost of corrosion was defined as that increment of total cost incurred
because of corrosion. It was also noted as to what cost would not be incurred if cor-
rosion did not exist. Thus it developed into three scenarios:

1. Existence of corrosion.
2. Nonexistence of corrosion.
3. Practice of economically most effective corrosion prevention method.

The IO model was constructed involving all three scenarios. The total national cost
of corrosion corresponds to the difference in GNP of scenarios one and two.
The corrosion costs were divided into avoidable and unavoidable costs.

1. Avoidable corrosion costs are those because of the use of corrosion control.
2. Unavoidable costs are those that are not amenable to reduction by the presently
available technology.

The following direct costs are included in the calculation of the total cost:

1. Replacement of equipment or buildings.
2. Loss of product.
3. Maintenance and repairs.
4. Excess capacity.
5. Redundant equipment.
6. Corrosion control (inhibitors, organic and metallic coatings).
7. Engineering research and development testing.
8. Design: material of corrosion not for structural integrity; material of corrosion
for purity of product; corrosion allowance and special processing for corrosion
resistance.
9. Insurance.
10. Parts and equipment inventory.

2.2.4.2 Sector Costs on the Basis of the Input–Output Model The Battelle-NBS
study used the IO model to estimate the cost of corrosion to sectors. In addition to the
IO model, the report focused on four areas: federal government, personally owned
automobiles, the electric power industry and loss of energy and materials.
On the basis of the experts’ judgment, industry indicators (coefficients in the IO
matrix) were calculated to obtain the cost of corrosion for any given sector. These
indicators were based on expert judgment as to how much purchases can be avoided
if there were no corrosion. The effects of corrosion reflected in: (i) changes to