In our earlier blogs, we explored the possibilities of using PSA technology and various separation processes to save energy costs and increase productivity. This blog provides a detailed analysis of the operational and capital costs of a PSA oxygen or nitrogen plant to help you make informed decisions.
Table of Contents
Why Is This Analysis Important?
Understanding the balance between capital cost and operational cost is essential when investing in a PSA oxygen or nitrogen plant. While the capital cost represents a one-time expenditure, the operational cost recurs regularly. This comparison ensures you select the most cost-efficient option in the long run.
Capital Cost
The initial investment for a PSA nitrogen or oxygen plant depends on the required capacity and gas purity. The cost ranges from as low as ₹5 lakh to as high as ₹10 crore. This is a fixed upfront expense that varies based on plant specifications.
Operational Cost
The primary operational cost of a PSA system arises from the power required to compress air. Ambient air is compressed to 6-7 barg by an air compressor, which is fed into the PSA system. Compressors account for the bulk of energy consumption, making them the primary determinant of operational costs. Other components like air dryers and the PSA plant itself consume significantly less energy in comparison. Given the high cost of compressed air, managing operational expenses is critical.
Maintenance Cost
PSA plants require regular maintenance. This cost can be managed through a Comprehensive Maintenance Contract (CMC), which typically amounts to 7-10% of the plant cost. Though important, maintenance costs are minimal compared to capital and operational costs.
To illustrate, let’s consider an industry that requires 100 Nm³/hr of nitrogen gas at 6 barg and 99.99% purity. We compare two vendors offering plants with the same output specifications:
Case 1 (Vendor 1):
- Plant cost: ₹20 lakh
- Compressor power: 75 kW/hr
Case 2 (Vendor 2):
- Plant cost: ₹30 lakh
- Compressor power: 55 kW/hr
Assuming a maintenance cost of 10% of the plant cost for both cases, the lifecycle costs over 10 years are calculated as follows:
Analysis
From the table above:
- Case 1 has an annual operational cost of ₹52.56 lakh, while Case 2 incurs ₹38.54 lakh.
- Case 2 saves approximately ₹14 lakh annually in operational costs compared to Case 1.
- Over 10 years, the savings with Vendor 2 amount to ₹1.2 crore, which is 12 times the plant cost difference.
Conclusion
Despite a higher initial investment, Vendor 2’s plant proves more economical in the long run due to lower operational costs. By spending an additional ₹10 lakh upfront, you save over ₹1 crore in 10 years. Thus, selecting a PSA plant based on lifecycle costs rather than just capital costs ensures long-term financial benefits.
For further insights into lifecycle cost calculations, refer to our blog How to calculate the ROI (Return on Investment) of PSA Nitrogen Generator compared to Liquid Nitrogen or Nitrogen Cylinder (1) or contact us.
Contact Us
For tailored solutions and expert advice on PSA and VPSA systems, contact us:
- Email: info@absstem.com
- Phone: 1800 3010 3394
- Website: www.absstem.com
