Transcript CHAPTER 4
CHAPTER 6 Estimation of Manufacturing Costs Don Scott ENCH 430 2/7/06 Factors • Direct manufacturing costs: vary with production rate • Fixed manufacturing costs: i.e. Taxes, insurance, depreciation. • General expense: i.e. Management, sales financing. Cost of manufacturing (COM) = Direct Manufacturing Costs(DCM) + Fixed Manufacturing Costs(FMC) + General Expenses(GE) COM can be determined if the following are known • • • • • Fixed capital investment (FCI) Cost of operating labor (COL) Cost of utilities (CUT) Cost of waste treatment(CWT) Cost of raw materials From table 6.2 • DMC=CRM+CWT+CUT+1.33COL+0.069FCI+ 0.03COM • FMC=0.708COL+0.068FCI+depreciation • GE=0.177COL+0.009FCI+0.16COM • COM=0.280FCI+2.73COL+1.23(CUT+CWT+ CRM) • COMd=0.180FCI+2.73COL+1.23(CUT+CWT +CRM) COL • • • • NOL=(6.29+31.7p2+0.23Nnp)0.5 NOL= number of operators per shift. p = number of processing steps for particulate Nnp= number of non-particulate processing steps, which is the number of pieces of equipment. • Note: Chemical plant operators are relatively highly paid. (Bureau of Labor and Statistics, Oil and Gas Journal, and Engineering News Record. CUT • Influenced largely by cost of fuel for electricity, steam, and thermal fluids • Purchase from public or private utility • Supplied by the company • Self generated adn used by single process unit. • Table 6.3 Cooling Tower Considerations • Total heat load and circulation rate. • Composition and saturation compositions of inorganics in feed water • Required chemical addition • Desired supply and return temperatures • Cost of tower and pumps • Cost of chemicals, electricity, and makeup water Refrigeration • Carnot Efficiency • Coprev=Evap T/(Temp difference of condenser and evaporator) • An increase in Temp difference means an increase in the work required for evaporator Steam • • • • • • • • Determine pressure levels Number of process users at different levels Which users will return condensate Determine condensate return header pressure Estimate blow down losses Complete a balance on the steam and condensate Determine capacity of the steam boiler Additional power generation possible with turbines. Raw Material Costs • Chemical Market Reporter • Seasonal prices • Contract pricing Yearly Costs and Stream Factors • Stream factor(SF) is the fraction of time a plant will be operating during a year in order to calculate yearly costs of materials and utilities. • SF = Number of days operating/365 Liquid and solid waste streams • Environmental regulations are primary cause for increase cost to waste treatment. • Alternatives to treatment.