(134b) Excel-Based Process Economics Computational Tools for Senior Level Process Design Courses

Chemical engineering economic calculations comprise an indispensable component of the decision-making process for grass-root design and debottlenecking studies of manufacturing plants. Understanding economic and finance calculations and their impact on the profitability and sustainability of chemical plants in the design stage or during routine operations is very important aspect of the education of future chemical engineers.

Chemical engineering departments traditionally integrate economic and finance calculations into their curricula as a separate course or module which is covered in the senior design courses. Typically, key elements, including equipment capital and operational costs, Net Present Value (NPV) or Internal Rate of Return (IRR) calculations, depreciation, tax, and interest are covered in the process design courses. Students usually obtain equipment and operational costs from various cost estimating software tools that are available either free or through academic license agreements; these cost estimates are then used to perform miscellaneous finance calculations such as depreciation, IRR and NPV. Even though expenses generated by computer tools give students some baseline, it is not clear how these calculations are done and how accurate they are. Moreover, these tools have a significant learning curve, and are introduced to the students during the last year of their studies; furthermore as mentioned earlier they require some type of academic license for their use.

To overcome these challenges, a team of senior students from the Chemical Engineering Department of the University of Illinois at Chicago (UIC), under the guidance of two faculty members developed a Process Economics Calculator in Excel using the Visual Basic for Applications (VBA) programming language. Through a well-designed interface, users of the Process Economics Calculator select and enter the sizing parameters of the process equipment along with some operational details; once the selection of the equipment is completed, equipment purchase and installed costs as well as operational costs are automatically estimated, and finally NPV values are calculated using data from the book Chemical Engineering Design, 2nd Edition by Gavin Towler and Ray Sinnott (2013 Elsevier Ltd.). Sensitivity analysis studies can also be carried out to gauge the effect of key process variables. The ease and accessibility of this Excel-based tool constitute a significant step in teaching process design and economics. The tool can be easily incorporated in the early years of chemical engineering curricula. Using this economic tool, first, second and third-year level chemical engineering students can be introduced to engineering economics and how they impact the decision-making process. The earlier exposure to economics will make it easier to integrate engineering design elements into intermediate-level courses. By promoting this engaging and easily accessible tool, students can have the opportunity to become better decision-makers in engineering and better problem solvers.

In this presentation, we will give a detailed description of the Excel-Based Process Economic Calculator, describe its most important features and demonstrate it with a number of examples drawn from the process simulation, optimization and design courses at UIC.