Do We Reallly Know Our Gas Consumption and Cost? – Part 1

Utility gases like Argon, Nitrogen, Helium, Oxygen etc. play a profound role in all major process industries. These gases act as an input feed for various processes across multiple application processes starting from manufacturing to preservation & storage purposes.

These gases come at a high price and are one of the highest contributing components in overall procurement cost to a customer. Therefore, Industries heavily monitor gas consumption costs to reduce expenses and improve operational efficiency.

One of the challenges most customers face is determining their actual gas requirement. This clarity is not limited only to the quantity but also understanding the process requirements in terms of purity levels and pressure required at the point of use. So, the question that needs an answer is “DO WE REALLY NEED WHAT WE ARE PAYING FOR RIGHT NOW? .

Through this blog, we aim to address the above with the below practical case study that might help customers ascertain their gas requirements.

Case Study: A Nitrogen Gas Consumption Analysis

A customer  using nitrogen gas from a cryogenic liquid source shared his requirement for a nitrogen plant with the following specifications:

Before submitting our proposal we requested an on-site visit to study the application process and current Nitrogen consumption pattern.  After a thorough study of the application and a detailed analysis of their current expenditures, we were able to identify a startling difference in customer requirements vis a vis actual application demands. The gist of the same is summarized below:

Key Findings

• The optimized selection of the PSA nitrogen plant led to over 50% savings in capital costs and 80% savings in operational costs per year.
• Over a 10-year plant lifecycle, incorrect selection would have resulted in potential financial losses.

Now, let’s analyze  the reasons for discrepancies  in the customer’s calculations vis a vis our findings:

1. Flow  Rate

   The customer calculated the nitrogen requirement by following a few simple calculation steps below:

   1. Calculate the monthly consumption of liquid nitrogen from the invoices submitted by the liquid N2 supplier.
   2. Dividing the total consumption by the number of working days (30 in this case) to calculate daily consumption and further dividing this value by daily working hours (24 hours in this case) to calculate the hourly N2 flow rate.

      While theoretically, these calculations appear to be logical, one critical factor was not taken into account i.e. the UOM (Unit of Measurement). It is noteworthy that the UOM (Unit of Measure) in the invoices raised for liquid nitrogen was in Litres whereas the flow requirement mentioned in the customer’s enquiry was in NM³/Hour. Taking view of these observations, the correct requirement of gas in NM³/Hr was re-calculated as below:
      As seen, the miscalculation resulted from incorrect unit conversions:

      1. 1 Litre of Liquid Nitrogen = 0.646 Nm³
      2. 1 kg of Liquid Nitrogen = 0.8 Nm³
      3. 1 Sm³ of Nitrogen Gas = 0.94 Nm³
   3. Many liquid nitrogen suppliers raise their invoices in Sm³ ?kg or Litres instead of Nm³, leading to incorrect plant sizing. For a detailed guide, read our blogs: How to Calculate the ROI (Return on Investment) of PSA Nitrogen Generator compared to Liquid Nitrogen or Nitrogen Cylinders (1) and Understanding NM³, SM³ and AM³: A Guide to Gas Volumetric Flow Measurements (2) 

2. Nitrogen Purity

   Since Liquid nitrogen has a default purity of 99.999%, the customer asked for the same purity levels from the PSA Nitrogen plant. While modern-day PSA N2 plants are fully capable of delivering ultra-high pure Nitrogen, we went into the detail of the actual N2 purity levels needed by the application process. Post our intensive discussions with the team members from customer’s quality control department and OEM of their food packaging machine, it was mutually agreed and decided that 99.9% purity was sufficient as per EIGA norms for food packaging.

   These corrections in purity levels were significant as the generation cost of 99.9% pure Nitrogen is significantly lower than 99.999%.

   Selecting unnecessarily high purity leads to increased capital and operational costs. For an in-depth discussion, refer to our blog  Understanding Nitrogen Purity in PSA Nitrogen Generators (3). 

3. Nitrogen Pressure At Point Of Use

   The customer’s liquid nitrogen tank was located 2,500 meters from the machine, and they were using a 6 Barg  (or kg/cm²g) supply pressure. However, the actual requirement for the machine at the point of use was only 2 Barg (or kg/cm²g).Since a PSA nitrogen plant can be installed much closer to the machine, nitrogen delivery pressure could be set at 2.5 Barg (or kg/cm²g), reducing pressure losses, energy wastage and operational costs pertaining to pipeline lengths etc
   For optimal nitrogen pressure settings for your application, read our blog Nitrogen Pressure Required for Different Industrial Applications (4).

Conclusion

Incorrect gas consumption calculations due to:

• Unit of Measurement misinterpretation
• Overestimated purity selection
• Overestimated pressure requirements

can drastically inflate costs in capital investment and daily operations.

For industries using nitrogen on a large scale, shifting to an on-site PSA nitrogen generation system—with an ROI of 6 to 18 months—is the best financial decision.

Contact Us

For tailored solutions and expert advice on maintaining PSA Oxygen or Nitrogen Generators, contact us:

• Email: [email protected]
• Phone: 1800 3010 3394
• Website: www.absstem.com

References

1. Absstem Technologies. (2024). How to calculate the ROI (Return on Investment) of PSA Nitrogen Generator compared to Liquid Nitrogen or Nitrogen Cylinders 
2. Absstem Technologies. (2024). Understanding NM³, SM³ and AM³: A Guide to Gas Volumetric Flow Measurements
3. Absstem Technologies. (2024). Understanding Nitrogen Purity in PSA Nitrogen Generators
4. Absstem Technologies. (2024). Nitrogen Pressure Required for Different Industrial Applications