Process Economics Program Report 145
Battery Limits Cost Estimating
Published: April 1982
Numerous **preliminary-type** methods of estimating battery limits costs have been developed. Those published range from highly simplified ones, requiring no design work, to those that require process design for the principal equipment items, estimating the costs of these items, and applying factors for field costs. We are concerned in this report only with the latter type. Within this category two general approaches have been used:
- Methods based on historical costs of complete plants. Some make a distinction in field cost factors by type of plant (e-g-, fluids processing as opposed to solids processing). At least one is based on statistical correlations of plant cost data. It takes into account the cost proportions of certain kinds of equipment.
- Modular cost estimating methods. In such methods, field cost factors are based on specific equipment items. Fundamentally this is more flexible than the method based on overall plant costs.
The method we have developed employs equipment modules, but differs from the modular methods of which we are aware, in that the field cost elements are (with two minor exceptions) unrelated to equipment costs. Rather, it is based on the physical characteristics of the equipment and materials handled in the process (e.g., size, flow, temperature, pressure). In this respect it resembles a simplified "takeoff" method.
We believe that our method will provide more accurate battery limits cost estimates than do other (published) modular or overall plant cost estimating methods for the following reasons:
- While field costs are indeed related to equipment costs, the relationship is only indirect. On the other hand, a direct relationship exists between field costs and the physical and chemical characteristics of the material processed, and noncost characteristics of the process equipment.
- Any errors in estimating the cost of process equipment are not compounded in the estimate of total battery limits cost.
There is likely to be significant disagreement in cost estimates prepared by professional estimators, particularly when shortcut methods are used. We expect, therefore, that the equations we have developed will be challenged, at least to some degree. We invite comment on and constructive criticism of both our concepts and our design and cost equations.
In general we urge that Process Economics Program cost estimates be compared with the costs of actual plants only under the following conditions:
The processes are substantially identical. The cost of utilities and other off-sites can be segregated from the battery limits plant cost.
Construction conditions are substantially identical with respect to factors such as labor productivity and the absence of construction delays due to strikes or other causes.