Variable Cost Summary Fixed Cost Summary

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9.4 Pricing of Wastewater and Purge Streams

A cost was assigned to the aggregated wastewater stream as a function of the flow rate of water in gpm and the loading of organic compounds. The operating cost of Deep-Tank Activated-Sludge Treatment is 300yr ·gpm of hydraulic flow plus 2,000yr·lb organichr, summing to 7,564,660 per year with the current waste water stream. 22 The resulting water stream is then considered safe to discharge into the environment. As stated in the project charter, the design and costing of construction of the wastewater facility is considered out of project scope, and the investment costs of the wastewater plant were not calculated. The lower heating values of propane, propene, acrylic acid, and acetic acid were mass- weighted and used to calculate the resulting heating value of the stream. Approximately 116.1 MM BTUhr can be released through burning the purge stream. If this stream could be converted to electricity with an assumed 20 efficiency at 0.16kWh, the stream is worth approximately 8.6 million per year. Alternatively, if the same stream could be converted to heat at 50 efficiency at 0.06kWh, the stream is worth 8.1 million. It was determined that it will be more economical to convert the stream to heat in order to avoid the considerable equipment costs of turbines, generators, condensers, and the like that would be required to generate the electricity. The heating value of 116 MM BTUhr can be deducted from the required energy utility inputs. 22 Mulholland, K. L., Dyer, J. A. 1998. Pollution Prevention: Methodology, Technologies and Practices: American Institute of Chemical Engineers. 110 111 Section 10 Economic Analysis 112

10.1 Economic Analysis

The economic analysis of this process was conducted using the discounted cash flow method. Once cash flows for each period were estimated, the net present value NPV of the cash flows can be calculated by applying a discount factor to each p eriod’s cash flow and taking the sum. For this process, a 15 discount rate was assumed. The discount rate should reflect the perceived risk of the project and the macro-economic exposure inherent in plant operations. Based on this information, a 15 discount rate is reasonably conservative and reflects the high degrees of uncertainty in plant operations, which is consistent with a plant in the first stages of design. Using this discount rate, the NPV is calculated as 384,963,400, over the assumed 20 year life of the plant. Another metric often used when evaluating different investment opportunities is the internal rate of return IRR. IRR is the discount rate at which the NPV of a series of cash flows is zero. This is a kind of annualized return on investment. The IRR of this process was calculated to be 84.9, reflecting a reasonably high return and suggesting that this process warrants further investigation.