The latest nova-paper presents a newly developed model for a techno-economic evaluation of industrial processes in a situation of limited data availability, especially where no equipment sizing is possible. The model was applied to the biorefinery concept BIOCORE with interesting results.
The techno-economic evaluation of industrial processes is particularly difficult when the principle data sources are energy and material flows from process simulation models. This is due to the fact that, at best, the number and type of required equipment is known, but no more detailed specifications as is needed for an equipment sizing. Therefore, a model is needed that could lead to satisfactory estimates of techno-economic parameters, even with such a limited database. The description of such a model is at the core of the paper.
The economic evaluation of an investment project for an industrial process includes the estimation of capital expenditures (CAPEX), annual operating expenditures (OPEX), revenues, profits, and further indicators of economic sustainability, e.g. the internal rate of return (IRR). The paper first describes the methodologies developed for estimating CAPEX and OPEX before briefly touching upon indicators of evaluating the economic viability of an investment project.
The model was applied in the framework of the European research project BIOCORE (BIOCOmmodity REfinery), which conceptualized an industrial-scale lignocellulosic biorefinery. However, the principles of this model could equally well be applied to other industrial processes. The model achieved reasonably good and coherent results, notwithstanding the limited data available.
The results from the BIOCORE project showed that especially those scenarios that produce high-value chemicals could come close to profitability with limited support mechanisms or GreenPremium. Conversely, scenarios with a focus on lignocellulosic ethanol production and energy use of lignin fare much poorer.
This encourages an evaluation of the model also for other early-stage processes in order to test its general applicability.
nova papers on bio-based economy are proposals to stimulate the discussion on current topics of the bio-based economy, by creating new perceptions based on scientific facts and by inviting relevant stakeholders to participate in decision-making processes and debates. Download nova-paper #5 at www.bio-based.eu/markets