Académique Documents
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Culture Documents
a,*
, M. Kates
Department of Chemical Engineering, University of Ottawa, Ottawa, Ont., Canada K1N 6N5
b
Department of Biochemistry, University of Ottawa, Ottawa, Ont., Canada K1N 6N5
Received 18 March 2002; received in revised form 12 May 2003; accepted 13 May 2003
Abstract
The economic feasibilities of four continuous processes to produce biodiesel, including both alkali- and acid-catalyzed processes,
using waste cooking oil and the standard process using virgin vegetable oil as the raw material, were assessed. Although the alkalicatalyzed process using virgin vegetable oil had the lowest xed capital cost, the acid-catalyzed process using waste cooking oil was
more economically feasible overall, providing a lower total manufacturing cost, a more attractive after-tax rate of return and a lower
biodiesel break-even price. On the basis of these economic calculations, sensitivity analyses for these processes were carried out.
Plant capacity and prices of feedstock oils and biodiesel were found to be the most signicant factors aecting the economic viability
of biodiesel manufacture.
2003 Elsevier Ltd. All rights reserved.
Keywords: Biodiesel; Economic assessment; After-tax rate of return; Break-even price; Sensitivity analysis
1. Introduction
Exploring new energy resources, such as biodiesel
fuel, is of growing importance in recent years. Biodiesel,
derived from vegetable oil or animal fats, is recommended for use as a substitute for petroleum-based
diesel mainly because biodiesel is a renewable, domestic
resource with an environmentally friendly emission
prole and is readily biodegradable. The use of biodiesel
as a fuel has been widely investigated. Its commercial
use as a diesel substitute began in Europe in the late
1980s.
At present, the most common way to produce biodiesel is to transesterify triacylglycerols in vegetable oil
or animal fats with an alcohol in the presence of an alkali or acid catalyst. Methanol is the commonly used
alcohol in this process, due in part to its low cost. The
products, fatty acid methyl esters (FAME), are called
biodiesel and include glycerine as a by-product. Alkalicatalyzed transesterication has been most frequently
used industrially, mainly due to its fast reaction rate.
Sodium hydroxide or potassium hydroxide is the usual
*
Corresponding author. Tel.: +1-613-562-5800x6110; fax: +1-613562-5172.
E-mail address: mclean@genie.uottawa.ca (D.D. McLean).
0960-8524/$ - see front matter 2003 Elsevier Ltd. All rights reserved.
doi:10.1016/S0960-8524(03)00150-0
alkali catalyst. In contrast, acid-catalyzed transesterication has received less attention because it has a relatively slow reaction rate. Nevertheless, it is insensitive to
free fatty acids in feedstock oil compared to the alkalicatalyzed system. The typical acid catalyst used in the
reaction is sulfuric acid.
Compared to petroleum-based diesel, the high cost of
biodiesel is a major barrier to its commercialization. It
costs approximately one and a half times that of petroleum-based diesel depending on feedstock oils (Prokop, 2002; Lott, 2002). It is reported that approximately
7095% of the total biodiesel production cost arises
from the cost of raw material; that is, vegetable oil or
animal fats (Krawczyk, 1996; Connemann and Fischer,
1998). Therefore, the use of waste cooking oil should
greatly reduce the cost of biodiesel because waste oil is
available at a relatively low price.
In a previous study, four dierent process owsheets
for producing biodiesel from virgin vegetable oil or
waste cooking oil by alkali- or acid-catalyzed transesterication were developed (Zhang et al., 2003). A
comparison of these processes was presented from the
point of view of their process technology. The results
showed that the acid-catalyzed process from waste
cooking oil was potentially a competitive alternative to
the commonly used alkali-catalyzed process. Besides the
230
2. Background
2.1. Economic studies
In previous economic studies of biodiesel production,
the main economic criteria were capital cost, manufacturing cost and biodiesel break-even price. Results of
three recent studies are given in Table 1. Nelson et al.
(1994) evaluated the economic feasibility of a plant
producing approximately 100,000 tonne/year of biodiesel. Beef tallow was transesteried with methanol in
the presence of an alkali catalyst. Noordam and Withers
(1996) carried out an economic study on a biodiesel
plant with a capacity of approximately 7800 tonne/year
biodiesel. Canola seed was used as the raw material.
Canola meal produced from seed crushing was a valuable by-product, providing a credit of $2.3 million. The
estimated equipment cost for the transesterication facility was $695,656. With respect to the transesterication unit, no detailed description of the process
owsheet or equipment sizing was provided. Other expenses, such as the costs of supervision, patents and
royalties, and research and development, were not taken
into consideration in their study. Bender (1999) compared seven biodiesel plants using dierent oilseeds (i.e.,
soybean seed, canola seed, sunower seed and rapeseed)
or animal fats as the raw material. The capital cost and
break-even price of biodiesel for each process were de-
Table 1
Economic evaluations for biodiesel production plants
Plant capacity
Process type
Raw material
Total capital cost
Total manufacturing cost
Biodiesel break-even price
Glycerine credit
Bender (1999)a
100,000 tonne/year
Alkali-catalyzed continuous
process
Beef tallow
$12 million
$34 million
$340/tonne
$6 million ($600/tonne)
7800 tonne/year
Alkali-catalyzed batch process
10,560 tonne/year
Alkali-catalyzed continuous process
Canola oilseed
Not reported
$5.95 million
$763/tonne
$0.9 million ($1450/tonne glycerine)
Animal fats
$3.12 million
Not reported
$420/tonne
$1.2 million for technical grade
glycerine ($1470/tonne); $0.72 million for crude glycerine ($660/tonne)
Only results for one of the biodiesel plants evaluated is reported here.
3. Process descriptions
Four dierent continuous processes to produce biodiesel from virgin oil or waste cooking oil were designed
and simulated using HYSYSTM . Flowsheets and technological assessments of these processes were provided
by Zhang et al. (2003). These processes were the focus of
the economic evaluation in the present investigation. A
brief description of each process follows.
Process I was an alkali-catalyzed process to produce
biodiesel from virgin vegetable oil. Virgin oil and a
mixture of methanol and sodium hydroxide were fed
into a transesterication reactor. After the reaction (at
60 C and 400 kPa), an euent stream containing
FAME, glycerol, methanol, unconverted oil and sodium
hydroxide entered a methanol distillation column where
231
232
4. Economic assessment
4.1. Basis and scope of calculations
Economic evaluations were based on the following
assumptions: (1) Each process was based on a plant
capacity of 8000 tonne/year biodiesel. This was the same
size as an existing plant in Europe (Connemann and
Fischer, 1998) and was consistent with plant sizes discussed previously (Zhang et al., 2003). In the following
sensitivity analyses, two other levels of plant capacity,
one at 4000 and the other at 12,000 tonne/year were
considered. (2) Operating hours for the biodiesel plant
were assumed to be 8000 h/year. (3) Both waste cooking
oil and virgin oil, used as the feedstock for biodiesel
production, are free of water and any solid impurities.
The prices of the raw material oil include costs associated with impurity removal and transportation. (4) In
the simulation, pump eciency was assumed to be 70%.
This was used to determine the pump shaft power. A
90% motor eciency was used to calculate the electricity
usage. Although a spare pump is usually required in a
chemical plant design, no spare pumps were taken into
account in this work. (5) Superheated, low and highpressure steams were used as the heating media. Water
was the cooling medium. Their specications and prices
are listed in Table 2. (6) All costs shown are in US$.
Equipment prices were updated from available mid-1996
to 2000 values using the Chemical Engineering Plant
Index, where I2000 394 and I1996;MID 382 (Turton
et al., 1998; Chemical Engineering, 2001). (7) All
chemical costs including raw materials, catalysts, solvent
and products are given in Table 2.
Table 2
Basic conditions for the economic assessment of each process
Item
Specication
Price ($/tonne)a
92 wt.%
85 wt.%
USD
99.85%
Tech.
NF/FC
98%
600
40
1200
750
410
180
340
4000
60
500
200
Chemicals
Biodiesel
Calcium oxide
Glycerine
Hexane
Methanol
Phosphoric acid
Sodium hydroxide
Sulfuric acid
Virgin canola oil
Waste cooking oil
Utilitiesb
Cooling water
Electricity
Low pressure steam (superheated)
High pressure steam (superheated)
400 kPa, 6 C
450 kPa, 210 C
2700 kPa, 500 C
Waste treatment
Liquid
Solid
Hazardous
Plant capacity
Thermodynamic model in process simulation
Methanol recovery in T-201
FAME purity
Methanol recovery in the pretreatment unit
$0.007/m3
$0.062/kW h
6.8
10
150
37
a
Unless specied, all prices are in US$/tonne. Chemical prices are from National Biodiesel Board, 2000, http://www.biodiesel.org, Chemical
Market Reporter (20002001), vol. 258 (22), vol. 259 (9) and http://www.chemconnect.com, November 2000.
b
Based on the price in mid-1996 provided by Turton et al. (1998) and updated to the year 2000.
233
Table 3
Equipment sizes, equipment costs and xed capital costs for case 1 (85% glycerine byproduct using NRTL)
Type
Description
Process I
Process II
Process III
Process IV
Reactors
Esterication
Size, (D L, m)
Cost, ($ 103 )
0.8 2.4
80
Transesterication
Size, (D L, m)
Cost, ($ 103 )
1.8 5.4
290
1.8 5.4
290
2.1 6.3a
673a
2.1 6.3a
673a
Neutralization
Size, (D L, m)
Cost, ($ 103 )
0.3 1
21
0.3 1
21
0.5 1.5
38
0.4 1.2
29
Methanol distillation
Size, (D H, m)
0.6 10
1 12
0.6 10
357
140
1 10
1 10
324
324
1 10
0.8 10
240
100
1 10
1 10
0.8 10
240
220
1.2 12
157
1.2 12
157
1 12
168
1.5 16c
256c
N/A
0.5 10
106
0.6 10
135
0.8 10
145
4
45
46
0.61
0.81
0.14
0.95
0.22
1.17
0.17
1.34
16
72
57
1.10
1.64
0.29
1.94
0.39
2.33
0.35
2.68
12
40
73
1.01
1.57
0.28
1.85
0.36
2.21
0.33
2.55
12
49
42
1.19
1.99
0.36
2.35
0.42
2.77
0.42
3.19
Columns
Cost,b ($ 103 )
Washing column
Size, (D H , m)
Cost, ($ 103 )
FAME distillation
Size, (D H , m)
Cost,b ($ 103 )
Glycerine purication
Size, (D H, m)
Cost,b ($ 103 )
Heat exchangers, cost ($ 103 )
Pumps, cost ($ 103 )
Others (separator, vacuum system), cost ($ 103 )
Total basic module cost ($ 106 ), CBM0
Total bare module cost ($ 106 ), CBM
Contingency fee ($ 106 ), CCF 0:18CBM
Total module cost ($ 106 ), CTM CBM CCF
Auxiliary facility cost ($ 106 ), CAC 0:3CBM0
Fixed capital cost, CFC ($ 106 ), CFC CTM CAC
Working capital ($ 106 ), CWC 0:15CFC
Total capital investment ($ 106 ), CTC CFC CWC
a
140
0.8 10
100
109
234
235
Table 4
Total manufacturing cost and after-tax rate of return for case 1 ($ 106 )
Process I
Process II
4.20
0.17
0.32
0.58
0.09
1.68
0.18
1.41
1.03
0.15
1.65
0.31
0.07
0.85
0.13
1.65
0.31
0.08
0.92
0.14
0.03
0.06
0.02
0.005
0.06
0.05
0.02
0.008
0.17
0.06
0.03
0.02
0.17
0.07
0.03
0.04
0.009
0.004
0.07
0.01
0.09
0.20
0.28
0.004
0.14
0.02
0.15
0.21
0.28
0.06
0.13
0.02
0.13
0.15
0.27
0.06
0.17
0.02
0.14
0.17
5.14
4.75
3.28
3.52
0.44
0.79
0.66
0.74
0.02
0.006
0.03
0.01
0.03
0.01
0.04
0.01
Subtotal, AIME
0.46
0.83
0.71
0.79
0.12
0.23
0.22
0.28
General expenses
Administrative costs, 25% of overhead
Distribution and selling cost, 10% of total manufacturing cost
Research and development, 5% of total manufacturing cost
0.11
0.68
0.34
0.20
0.71
0.35
0.17
0.52
0.26
0.18
0.56
0.28
Subtotal
1.14
1.26
0.94
1.03
7.59
0.73
6.86
4.80
)2.06
)1.03
)1.03
)85.27
7.76
0.68
7.08
4.80
)2.28
)1.14
)1.14
)51.18
5.92
0.77
5.15
4.80
)0.35
)0.18
)0.18
)15.63
6.35
0.73
5.62
4.80
)0.82
)0.41
)0.41
)21.48
Process III
Process IV
(e.g., the methanol distillation column). The pretreatment unit contributed signicant unique costs, resulting
in a large increase in the xed capital cost in process II.
Overall, process I, the alkali-catalyzed process using
virgin oil as the raw material, had the lowest xed
capital cost. The fast transesterication reaction reduced
the size and cost of the reactor. The use of virgin oil with
low-levels of free fatty acids removed the need for a
pretreatment unit. The use of less corrosive sodium
hydroxide reduced the requirement for stainless steel as
the material of construction in some pieces of process
equipment. Consequently, the xed capital cost and the
total capital investment in process I were much lower
II
III
IV
100
75
50
25
0
-25
-50
-75
-100
Cost (million $)
-8 -6 -4 -2 0 2 4 6 8
236
Process Type
Fig. 1. Economic performance of processes I, II, III, and IV for case 1.
Table 5
Summary of economic criteria for each process for case 1
Process I
Process II
Process III
Process IV
0
0
0.76
46
0
0
0
0
Transesterication unit
Cost ($ 106 )
Percentage (%)
0.33
41
0.31
19
0.72
46
0.72
36
Separation unit
Cost ($ 106 )
Percentage (%)
0.48
59
0.57
35
0.85
54
1.27
64
0.81
100
1.64
100
1.57
100
1.99
100
5.14
75
4.75
67
3.28
64
3.52
63
Indirect manufacturing
Cost ($ 106 )
Percentage (%)
0.46
7
0.83
12
0.71
14
0.79
14
General expenses
Cost ($ 106 )
Percentage (%)
1.14
17
1.26
18
0.94
18
1.03
18
Depreciation
Cost ($ 106 )
Percentage
0.12
2
0.23
3
0.22
4
0.28
5
Subtotal
Cost ($ 106 )
Percentage
6.86
100
7.08
100
5.15
100
5.62
100
Protability
Net annual prot after taxes ($ 106 )
)2.06
)2.28
)0.35
)0.82
)85.27
)51.18
)15.63
)21.48
857
884
644
702
237
238
5. Sensitivity analysis
After completion of the economic assessment of the
biodiesel production processes, sensitivity analyses for
these processes were conducted to determine the sensitivity of the after-tax rate of return to changes in a variety of factors thought to plausibly signicantly impact
the process economics. As an example for discussion,
process III, the acid-catalyzed process to produce biodiesel from waste cooking oil, was used. Detailed procedures have been presented elsewhere (Zhang, 2002).
Nine factors, identied in Table 6, were investigated.
The purity of glycerine was treated as a block factor.
Table 6
Descriptions of factors in sensitivity analysis for process III
Factor
X1
X2
X3
X4
X5
X6
X7
X8
X9
Description
Level
Plant capacity
Price of waste cooking oil
Methanol price
Glycerine price (85 wt.%, block I)
Glycerine price (92 wt.%, block II)
Thermodynamic model
Biodiesel price
Price of sulfuric acid
Methanol recovery in T-201
Final FAME (biodiesel) purity
)1
4000 tonne/year
$100/tonne
$80/tonne
$650/tonne
$1100/tonne
NRTL
$400/tonne
$50/tonne
90%
99.6 wt.%
12,000 tonne/year
$300/tonne
$280/tonne
$850/tonne
$1300/tonne
UNIQUAC
$600/tonne
$250/tonne
98%
99.7 wt.%
Table 7
Results of sensitivity analysesa
Process
Process description
Major eects
Minor eects
Process II
Interaction of X1 X6 , interaction of X1 X2
Process III
Process IV
a
239
1200
Price (US$/tonne)
1000
85 wt% glycerine
800
600
break-even price of
biodiesel
400
200
0
1997
1998
(a)
1999
year
2000
2001
2500
Price (US$/tonne)
2000
92 wt% glycerine
1500
break-even price of
biodiesel
1000
500
0
1997
(b)
1998
1999
year
2000
2001
Fig. 2. Yearly change in price for glycerine and its impact on the break-even price of biodiesel.
6. Conclusions
On the basis of the economic assessment of four
continuous alkali- and acid-catalyzed processes using
virgin oil or waste cooking oil as the raw material, the
following conclusions were made. The alkali-catalyzed
process using virgin oil (process I) had the lowest total
capital investment because of the relatively small sizes
and carbon steel construction of most of the process
equipment. For a plant producing 8000 tonne/year
biodiesel, the total capital investment in process I was
approximately half of that in the other processes. Process I thus requires the least initial investment when
building a biodiesel plant.
Raw material costs account for a major portion of
the total manufacturing cost. Thus, reduction of the raw
material cost should be the rst step in optimizing the
total manufacturing cost. Virgin oil costs approximately
23 times more than waste cooking oil indicating that
use of virgin oil leads to a substantial increase in total
manufacturing cost. As a result, although process I had
the lowest cost requirement for building a biodiesel
plant, it had a high manufacturing cost osetting any
economic advantage in terms of return on investment or
biodiesel break-even price.
When waste oil of low cost was used as the raw
material, alkali-catalyzed process II required a pretreatment unit to reduce the content of free fatty acids.
The cost associated with this pretreatment unit, including the cost for extra solvent, more than balanced the
credit of using waste oil. This led to a reduced economic
feasibility for process II. The acid-catalyzed system was
insensitive to free fatty acids and no pretreatment unit
was required. Accordingly, the acid-catalyzed processes
to produce biodiesel from waste cooking oil (processes
III and IV) had lower total manufacturing costs than the
alkali-catalyzed process, so that the acid-catalyzed process would cost less to operate. Glycerine was a valuable
by-product, which could add an appreciable credit to
240
Acknowledgements
The Natural Sciences and Engineering Research
Council of Canada supported this work. The authors
acknowledge Dr. A.Y. Tremblay for his assistance with
the HYSYSTM simulation and Dr. B.C.-Y. Lu for his
assistance with the thermodynamic model.
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