## Estimating the Unit Cost of Treating Food and Agricultural Wastewater

Cost estimation of a yet-to-be-built wastewater treatment facility is difficult; as an engineer or process designer, your responsibility is not to try to outsmart the experts that are hired to do cost forecasting if a decision of building a specific design of wastewater treatment facility is finalized; rather, your job is to estimate the total costs of a particular wastewater project in order to compare the one under the study to other treatment/ management alternatives or options. The estimation of costs in this exercise could be as much as 30% off the actual costs, which is not unusual. The total costs of building and operating a wastewater treatment facility consist of capital costs and operating costs.

### Capital costs

These include the unit construction costs, the land costs, the cost of the treatment units, and the cost of engineering, administration, and contingencies. The location should be carefully evaluated in each case because it affects the capital costs more than the operating costs. The cost of equip-

 Liquid Stream Correlation Preliminary treatment C = 5.79 X 104 X Q1.17 Flow equalization C = 1.09 X 105 X Q0.49 Primary sedimentation C = 1.09 X 105 X Q1.04 Activated sludge C = 2.27 X 105 X Q0.17 Rotating Biological Contactor (RBC) C = 3.19 X 105 X Q0.92 Chemical addition C = 2.36 X 104 X Q1.68 Stabilization pond C = 9.05 X 105 X Q1.27 Aerated lagoon C = 3.35 X 105 X Q1.13 Chlorination C = 5.27 X 104 X Q0.97 Solids Stream Correlation Sludge handling C = 4.26 X 104 X Q1.36 Aerobic digestion C = 1.47 X 105 X Q1.14 Anaerobic digestion C = 1.12 X 105 X Q1.12 Incineration C = 8.77 X 104 X Q1.33

Q = the flow rate of the raw wastewater stream (unit = million gallons per day).

Q = the flow rate of the raw wastewater stream (unit = million gallons per day).

ment may also be a significant portion of the capital costs in more automated and elaborate installations. USEPA (1983) compiled a list of construction costs for most common unitary processes of wastewater treatment. Some of the cost correlations are shown in Table 9.1. These unitary cost estimates are developed for municipal wastewater treatment and may not be totally suitable for food and agricultural wastewater treatment plants or small-scale wastewater treatment plants; however, they are quite useful for preliminary estimation and process comparison among different alternatives.

Wright and Woods (1993) compiled capital costs for several processes of physical treatment where capital cost correlations are given for oil-water separators, equalization basins, primary clarifiers, secondary clari-fiers, reverse osmosis and ultrafiltration units, gravity filters, and micro-screens. Data are included for raw sewage, intermediate and recirculation pumping stations preliminary treatment (including bar screens, grit removal, overflow and bypass chamber, and Parshall flume), and for grit removal, comminution, and gas stripping. They have also compiled capital cost estimations for several biological wastewater treatment processes where capital cost correlations are given for aeration basins, mechanical aerators, diffused aeration, conventional activated sludge process, extended aeration, contact stabilization, oxidation ditch, Rotating Biological Contactor (RBC), trickling filter, aerobic lagoons, facultative lagoon, aerated lagoons, and liners (Wright and Woods, 1994). A similar demonstration for capital cost estimations of several chemical processes in waste-water treatment was also provided in a later paper (Wright and Woods, 1995). Other useful sources on estimation of capital costs can be found in the literature (Peters and Timmerhaus, 1980; Ulrich, 1984; Brown, 2003). However, some of these cost estimations are based on process chemical industry and may not be entirely relevant to wastewater treatment plant design and economics.

### Operating costs

Operating costs are annually based costs that are required to operate the constructed facility, including direct costs and indirect costs. If a loan occurs in order to construct the wastewater treatment facility, the operating costs should also include capital charges or financial charges. Direct costs consist of chemicals, supplies and materials, labor, utilities (mainly energy), maintenance, and repairs; indirect costs include overhead, local taxes, and insurance. Chemicals, supplies, and materials are those used in chemical and/or advanced treatment processes depending on the implementation of the treatment processes and the throughput of each process. Labor cost represents wages for personnel for people who operate the facility. The cost can be estimated as two operators per unit per shift (Ulrich, 1984); however, if the operation in the wastewater treatment facility is more or less labor-intensive, the cost needs to change accordingly. Additionally, supervisory labor and clerks should be counted separately as 10-20% of the labor cost. Utilities include electricity, natural gas or heating oil, potable water, and steam. Electricity cost, by far, accounts for the majority of the cost of utilities. Maintenance and repairs typically represent 2-10% of fixed capital depending on the reliability and the complexity of the equipment in each unit. Fixed capital is the investment in the construction of the wastewater treatment facility, which cannot be recovered easily once spent. If a patent is involved in the process, a royalty has to be paid yearly and the cost of royalty should be included as a part of direct costs.

Overhead, local taxes, insurance, and general expenses comprise indi rect costs. Overhead cost represents fringe benefits (mainly medical, dental, and life insurance), Social Security and Medicare taxes (U.S. only; other nations may have different but similar social benefit programs), and retirement obligations. Depending on the locality and composition of employees, the cost of overhead could be as high as 70% of costs for labor, supervisory and clerical employees, and maintenance and repairs. Local taxes are difficult to pinpoint and should be decided on case-by-case basis; 1-2% of fixed capital is suggested as a rough, initial estimation. In the United States, insurance costs can account for 0.4-1% of fixed capital. General expenses include administrative expenses and other corporate expenses; they can be estimated as 15% of the labor cost.

A loan of capital may be required to construct a wastewater treatment facility. Depending on the interest rate and the number of the years of the loan, annual capital charges could run as high as 20% of the total capital and may impact significantly on operating costs.

The main factors that influence the costs of operation and maintenance are energy; labor, including the personnel for operation; maintenance and administrative services; material and chemical costs; capital charges; and cost of transportation of sludges for final disposal and discharge of treated wastewater. The relative importance of these cost items vary significantly with the location, the quality of the effluent discharged, and the specific characteristics of the wastewater. A summary of operating costs is provided in Table 9.2.

### Estimation of total costs

Total costs of a wastewater treatment plant are the totals of capital costs and operating costs. In case capital and operating costs are difficult to estimate, a shortcut formula for small wastewater treatment plants can be employed to save the time of estimating total costs. If one knows the capital costs of a similar plant with a different capacity, the capital costs of the plant of interest can be estimated through cost scaling. The idea originates from the chemical industry and recognizes that capital costs are strong related to equipment size. It further follows that capital costs are proportional to 2/3 power of the ratio of their capacity. This fundamental idea can be expressed as the following (Equation 9.1) (Ulrich, 1984):

CA = CB (Capacity of plant A/Capacity of plant B)n

Table 9.2. A summary of operating costs in wastewater treatment facilities (adapted from Brown, 2003).

Direct Costs

Chemicals, supplies, and materials (CSM)

Labor cost

Supervisory and clerical labor Utilities

Maintenance and repairs Patent royalty payment Direct subtotal

Estimation

m is feed rate; f is capacity factor 10-15% of fixed capital 10-12% of labor cost Dependent on current energy market 2-10% of fixed capital Up to 3% of other direct expenses Sum of all direct expenses

Indirect Costs

Local taxes Insurance General expenses Capital charge

Annual operating costs

### Estimation

50-70% of labor, supervisory/clerical labor, and maintenance and repairs 1-2% of fixed capital—may vary greatly 0.4-1.0% of fixed capital 15% of labor + 5% of direct expenses Annual payment of interest and principle on loan: Cpayment = Cloan i (1+i)n/

[(1+i)n-1], where n is duration of loan in year Sum of direct costs and indirect costs where:

CA = predicted capital costs of plant A CB = known capital costs of baseline plant B

n = economy of scale sizing component (<1). For capital cost estimation, n = 2/3.

Operating costs can also be estimated by an expression similar to Equation 9.1 (Equation 9.2):

OA = OB (Capacity of plant A/Capacity of plant B)n where:

OA = predicted operating costs of plant A

OB = known operating costs of baseline plant B

n = economy of scale sizing component (<1). For operating cost estimation, n = 0.85.

An alternative procedure for the development of cost models for waste-water treatment systems includes the preparation of kinetic models for the possible treatment alternatives, in terms of area and flow rates at various treatment efficiencies, followed by the computation of mechanical and electrical equipment, as well as the operation and maintenance costs as a function of the flow rates (Uluatam, 1991). The models so developed can be used to select the most appropriate treatment process.

For a more completely user-friendly and computerized cost estimation for wastewater treatment plants, there are several companies marketing commercial software tools for designers and those who contemplate installing or running a wastewater treatment facility on-site. One of these companies is Hydromantis, which just released CapdetWorks® version 2.1.

CapdetWorks® is a planning-level design and costing tool that allows the user to drag and drop unit processes to build a wastewater treatment plant schematic; automatically calculate a design; and then estimate the cost to build, operate and maintain the facility. At the planning level, current engineering practices primarily use empirical modeling techniques in combination with cost databases. This involves gathering historical capital and operating costs of similar size plants with similar wastewater and treatment characteristics. These techniques often estimate the cost based on only a single wastewater parameter, such as the wastewater flow rate. CapdetWorks® is a more comprehensive system since the design is based on all the characteristics of the wastewater being treated.

CapdetWorks® 2.1 uses both empirical costing models and design algorithms for individual processes and pieces of equipment. About 60 treatment processes are provided, including physical/chemical, biological, sludge stabilization, handling, and dewatering technologies. From the user's plant layout, the software automatically calculates the required unit process dimensions and equipment. It also allows the engineer to override any of the calculated designs. There is a sophisticated scenario management feature that encourages the user to lay out many treatment alternatives and rapidly calculate and compare costs between them. Capital and operational costs for each process technology can be localized, or users can create their own cost index or apply published industry cost indexes to the default values.

CapdetWorks® version 1.0 is available for most Microsoft Windows operating systems and costs U.S. \$2,450 per license. Free evaluations can be downloaded from the company website at http://www.hydromantis.com.

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