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July 2020 / 15 PBE PNEUMATIC POINTS TO PONDER… Jack D. Hilbert, SME, and Colin Barbeau, guest co-author, Hatch Selecting technology using a cost analysis approach I n past "Pneumatic points to pon- der…" articles, we've focused more on the technology aspects of pneumatic conveying compo- nents and system design instead of looking at the bigger economic picture of choosing a conveying system. We provided you with information, tools, and recom- mendations to optimize a system's performance and help evaluate a vendor's proposal. However, minus a few isolated columns, we haven't provided you with information about the economics of pneumatic conveying in regard to how this method compares with alternative forms of material conveying. In focusing on the economic advantage of one conveying system over another, keep in mind that every project comes with different processes, design criteria, condi- tions, and technical advantages and disadvantages, all of which affect the total project cost and operational cost. Because of these variables as well as others, each project should be evaluated on a case-by-case basis. Technology's financial considerations Common practice during a technol- ogy trade-off study is to calculate the approximate capital expenses (CAPEX) of the different technol- ogy being evaluated. The CAPEX are the funds that will be used to acquire, install, and commission technology should it be imple- mented in the process. Calculating the CAPEX is a typical early project phase step and is necessary to determine an estimated total proj- ect implementation cost, which will lead to getting the funds approved for the project's execution. Opera- tional expenses (OPEX) are rarely evaluated in the early project phases but can sometimes allow an owner to make a better-informed decision on the best technology for an application. The OPEX are recur- ring costs that will affect the plant's bottom line year after year, and we believe that the OPEX should be part of a complete trade-off study. Determining the OPEX The costs of the equipment's spare parts, associated labor, annual power consumption, and produc- tion time lost typically account for the majority of the OPEX and should be part of the evaluation. Spare parts. Obviously, the first thing that comes to mind when thinking about operational costs are spare parts. Discussions with suppliers and other end users with similar applications should be had to benchmark the frequency of spare part changes and repairs per year. Keep in mind that if a spare part is a long lead item, buying the part as CAPEX to have the part ready for commissioning and the first year of operations might be necessary. Labor. Different items must be considered to correctly estimate labor costs. Try to estimate the required workhours in regard to the accessibility of each part of the system, any productivity loss in a brownfield environment (a con- taminated environment that has developmental potential), local labor rate, and special rental equip- ment if required. Ideally, 3D models of the different system options should be available to execute your TABLE I Base case process data Parameter Value Capacity 95 stph Material size Powder up to ¹⁄ 8 inch Material temperature Very high Material abrasiveness Extreme Miscellaneous No silica dust emissions allowed