13 Jan 1988

Capital and operating cost estimating aspects of environmental control technology – residue hydrodesulphurisation as a case example

Report no. 88/51: Capital and operating cost estimates require a defined data framework to allow comparative scrutiny and meaningful correlation to be made with other estimates for the same and alternative technologies. The various elements of control technology cost estimating are described under the headings of:

- Capital cost

- Capital charge

- Fixed and variable operating costs

- Loss - Indirect costs/benefits Special emphasis has been put on capital cost estimating and the concept of capital charge.

An accuracy of 2 30% is considered sufficient for capital cost estimates to allow ranking of different control technologies. This means putting emphasis on the identification and inclusion of the main cost items, rather than going into fine detail on equipment, and on clear statements of the assumptions made. A worked example is shown of a particular residue desulphurisation case. This shows that capital charge makes the largest single contribution to annual costs followed by energy and loss.