Académique Documents
Professionnel Documents
Culture Documents
BIOGAS DIGESTER
FOR HI-GRADE FEEDS
May 2006
APPROVAL SHEET
This is to certify that we have supervised the preparation of and read the design report prepared
by Miriam Abigail G. Chang, Danica Mari Calipes, Anne Margaret G. Mejia, and Alvin A.
Talampas entitled Biogas Digester for Hi-Grade Feeds and that the said report has been
submitted for final examination by the Oral Examination Committee.
__________________________
Winston B. Flora
Course Adviser
________________________
Teresita P. Madulid
Adviser
As member of the Oral Examination Committee, I certify that I have examined this design
report, presented before the committee on May 20, 2006, and hereby recommended that it be
accepted as fulfillment of the design report requirement for the degree in Program of Bachelor
of Science in Chemical Engineering.
________________________
Winston B. Flora
Panel Member
This design report is hereby approved and accepted by the School of Chemical Engineering,
Chemistry and Biotechnology as fulfillment of design report requirement for the degree in
program of Bachelor Science in Chemical Engineering.
________________________________
Prof. Luz L. Lozano
Dean, School of Chemical Engineering,
Chemistry and Biotechnology
LETTER OF TRANSMITTAL
We hope that this report will satisfy the requirements for Plant Design (DESIGN313).
Respectfully yours,
________________________
Chang, Miriam Abigail
2002119509
B.S. CCE
________________________
Calipes, Danica Mari
2001132920
B.S. CHE
________________________
Mejia, Anne Margaret
2002128418
B.S. CHE
________________________
Talampas, Alvin
2002121809
B.S. CCE
ACKNOWLEDGEMENT
We would like to extend our gratitude and recognition to the following who help us
finished this study, Biogas Reactor for Hi-grade Farm. For without them, this study may not be
possible.
Our families, for being our strength at times when we want to give up and for being
our inspirations to strive for the best.
Ms. Theresita P. Madulid for giving us enough information regarding her Hi-grade
farm.
Mr. Ruben Mercado for his warm accommodation in his farm in Bulacan
Engr. Felecitos Aguilar and Engr. Narciso Macaranas for joining in our farm visit
Engr. Alvin Caparanga and Engr. Edwin Obra for supervising us in our equipment
design.
Engr. Winston Flora for entertaining our questions during consultations and for
supervising us in our project.
And most especially to the Lord Almighty for giving us the guidance and wisdom
To God be the glory!!
ii
TABLE OF CONTENTS
LETTER OF TRANSMITTALi
ACKNOWLEDGEMENT ............................................................................................................... i
INTRODUCTION .......................................................................................................................... 1
EXECUTIVE SUMMARY ............................................................................................................ 5
Objectives of the Project............................................................................................................. 5
SWOT Analysis .......................................................................................................................... 5
MARKET STUDY ......................................................................................................................... 6
Production Description ............................................................................................................... 6
Use of Product............................................................................................................................. 7
User of the Product ..................................................................................................................... 7
Historical and Projected Demand ............................................................................................... 8
Historical and Projected Supply.................................................................................................. 9
TECHNICAL STUDY ................................................................................................................. 10
Description of Raw Materials ................................................................................................... 10
Material Balance Major Assumptions ...................................................................................... 11
Overall Material Balance .......................................................................................................... 12
Detailed Material Balance (10-day process)............................................................................. 13
Process Flowchart ..................................................................................................................... 14
Equipment Specification........................................................................................................... 15
ENVIRONMENTAL STUDY ..................................................................................................... 17
Material Safety Data Sheet ....................................................................................................... 23
FINANCIAL STUDY................................................................................................................... 28
CONCLUSION AND RECOMMENDATION............................................................................ 50
APPENDIX................................................................................................................................... 52
List of Tables
Table 6.1 GANTT Chart .............................................................................................................. 28
Table 6.2 Pre-operating expenses. ................................................................................................ 29
Table 6.3 Pre-operating salaries with benefits.............................................................................. 29
Table 6.4 Administrative and Marketing expenses....................................................................... 30
Table 6.4 Construction Cost ......................................................................................................... 33
Table 6.6 Salary and wages projection ........................................................................................ 34
Table 6.7 Depreciation1 of all equipments................................................................................... 35
Table 6.8 Repair and maintenance of all equipments .................................................................. 36
Table 6.10 Projected revenue....................................................................................................... 38
Table 6.11 Inventory of finished goods ........................................................................................ 39
Table 6.12 Project cost................................................................................................................. 40
Table 6.13 Cost of production ...................................................................................................... 42
Table 6.14 Income statement ....................................................................................................... 43
Table 6.15 Balance sheet ............................................................................................................. 45
Table 6.16 Cash flow. .................................................................................................................. 46
Table 6.17 Breakeven analysis .................................................................................................... 47
Table 6.18 Rate of investment ..................................................................................................... 48
Table 6.19 Payback period............................................................................................................ 49
List of Figures
INTRODUCTION
The use of biogas as a source of fuel is a practice only recently introduced in this century.
The process of bacterial decomposition has occurred in nature since life began plants and
animals die and are recycled to sustain life on the planet. In the presence of oxygen, organic
material "composts" (undergoes aerobic decomposition). When decomposition occurs in the
absence of oxygen (anaerobic conditions), biogas is produced, and the liquid remainder is rich in
nitrogen and other nutrients.
The Philippines has substantial biogas resources. Biogas accounts for a significant
proportion of renewable energy generation (99% of new and renewable energy demand
excluding geothermal and hydro power for 1996), mainly from wood fuel and charcoal. Large
amounts of agricultural residues and municipal solid waste are also produced, offering promising
resources for heat and power generation.1
With the present energy and pollution problem in the Philippines, conversion of livestock
wastes as source of energy and fertilizer, offers a great advantage for the livestock industry. A
program that suits the need of backyard livestock raisers to abate the worsening problem of
environmental pollution is now given high priority.
Biogas is one of the renewable sources of energy receiving popularity in rural areas and
has successfully met the cooking energy needs of families. The optimum utilization depends
www. emb.gov.ph
upon the successful physical installations, which in turn depend upon plant design and its
selection.2
Biogas is a zero waste technology. The products of biogas plants, like biogas and
digested slurry can be utilized economically for cooking and as manure for agriculture and
horticulture. Biogas is a non-poisonous and non-toxic gas which when mixed with air burns with
blue flame, without soot or any offensive smell. The slurry is rich in nitrogen, phosphorous,
potash and humus material. It has good applications in agriculture and horticulture.
Use of biogas technology improves the standard of living and can directly contribute to
economic and social development of a country.
However, there are hurdles to implementation of these systems, including high capital
costs, availability of economic and environmentally acceptable methods of gas processing, and
economic means for biogas utilization. Because of these limitations, agricultural biogas
production has remained a virtually untapped resource in the Philippines.
Considering the opportunities and problems on the biogas production the researchers
attempts to design a biogas digester for hog manure which is more efficient, economical and
environmentally accepted.
The complete design of the digester constructs a digester in larger scale for preheating of
water at Hi-grade feeds at Bocaue, Bulacan. In addition, it can minimize the amount of municipal
waste that can help in environmental preservation by utilizing that manure in more useful way.
www.encyclopedia.com
Digesters are not a new idea and have been around for a long time. Increasing
environmental pressures on waste disposal has increased the use of digestion as a process for
reducing waste volumes and generating useful byproducts. The purpose of all these digesters is
to produce combustible biogas which can be burned to provide energy for a whole range of uses.
In the United States an outreach program called AgSTAR designed to reduce methane
emissions from livestock waste management operations by promoting the use of biogas recovery
systems. A biogas recovery system is an anaerobic digester with biogas capture and combustion
to produce electricity, heat or hot water. Biogas recovery systems are effective at confined
livestock facilities that handle manure as liquids and slurries, typically swine and dairy farms.
Anaerobic digester technologies provide enhanced environmental and financial performance
when compared to traditional waste management systems such as manure storages and lagoons.
Anaerobic digesters are particularly effective in reducing methane emissions but also provide
other air and water pollution control opportunities. The AgSTAR Program has been very
successful in encouraging the development and adoption of anaerobic digestion technology.
Since the establishment of the program in 1994, the number of operational digester systems has
doubled. This has produced significant environmental and energy benefits, including methane
emission reductions of approximately 124,000 metric tons of carbon equivalents and annual
energy generation of about 30 million kWh.3
Our group was able to visit and see the digester of Mr. Ric Perez in Bulacan. The Perez
household has the simplest structure and model of the digester and this has been working for
almost 14 years. They use this digester to produce biogas using the pig and chicken manure as
3
www.agstar.com
their raw materials. The biogas produce was use as a replacement for LPG as a cooking gas for
their household. The equipment has also a safety measure. The cover of the digester is allowed to
rise but with a limit. When the limit is achieved, bubbles in water are visible for the pressure is
released through the water.
Also, Mr. Ruben Mercado uses biogas as a source of energy. The biogases produced by
the pigs are used to preheat the water for the boiler. In this case, he was able to minimize his
usage of banker oil for the water entering the boiler is already at elevated temperature. He is
using a lagoon which has been operating for almost five years. The design also includes safety
measures like u- tube.
EXECUTIVE SUMMARY
Objectives of the Project
This study aims to design a Biogas reactor for Hi-grade farm that will produce biogas for
pre-heating water for the boiler of the mill. This project expects to achieve the following
objectives:
To maximize the use hog manure to a useful product which is the biogas
SWOT Analysis
Strength
Weakness
Not well-verse in the field of business- some financial elements may not be
considered which can affect in the financial reports
Opportunities
Reduction of waste
Peso depreciation decrease of peso value will result to increase in savings due to
bunker fuel
Threat
Peso appreciation the increase of peso is a great effect in our companys profit
MARKET STUDY
Production Description
There are varieties of gas useful as fuel. The three most commonly used worldwide are
Liquefied Petroleum Gas (LPG, propane, butane), Natural gas, and Biogas4. LPG is a mixture of
volatile fractions from petroleum refining; principally propane, butane, propylene and butylene.
Natural Gas is a fossil fuel that was created eons ago by the anaerobic decomposition of organic
materials. It is often found in association with oil and coal.
Biogas is produced when bacteria breakdown organic material in the absence of oxygen,
in a process known as anaerobic digestion. The same type of anaerobic bacteria that produced
natural gas also produced methane today. Anaerobic bacteria are some of the oldest forms of life
on earth.
Biogas is generally between 60% methane, with the remainder consisting of 39% carbon
dioxide, hydrogen sulfide and other trace gases5. Biogas burns well and can be used to provide
energy in the form of heat or electricity. Biogas can therefore not only off-set fossil fuel imports,
it can result in no increases, and even reductions in greenhouse gases. Methane is 30-times more
reactive than C02 in causing global warming6.
Twidell, John et. al. Renewable Energy Resources, (an imprint of) Chapman & Hall, London 1986
Fulhage, Charles et. al. Generating Methane Gas from Manure, Department of Agricultural Engineering, College of Agriculture
Woods, Sandra, et. al. Methane Fermentation of Biomass, Seattle, Washington September 1980
Use of Product
It is used as a substitute for LPG in preheating the water upon feeding to the boiler. In
this way we will be able to lessen the use of bunker oil because the feed water is higher than
25C so heat required to convert water to steam will be lower.
It will be use by the Hi-grade feed located at Bocaue, Bulacan. The biogas will be use to
preheat the water that is required to the boiler.
Projected Demand
2000
20
06
20
07
20
08
20
09
20
10
20
11
20
12
20
13
20
14
20
15
20
16
1500
1000
500
0
The Historical and Projected Demand is based from the information given by Ms.
Teresita Madulid (Hi-Grade feeds Company owner) according to the demand in terms of amount
of water which is being fed to the boiler by 15% annually. The increase in production of feeds is
directly proportional to the amount of water used to the boiler.
Historical Supply
15000
10000
5000
19
97
19
98
19
99
20
00
20
01
20
02
20
03
20
04
20
05
20
06
19
96
20
16
20
15
20
14
20
13
20
12
20
11
20
10
20
09
20
08
20
07
20
06
TECHNICAL STUDY
Description of Raw Materials
There is a growing concern about the widespread problem brought about by the improper
disposal of animal manure in many tributaries in the Philippines. Recent outbreak of diseases in
some municipalities had been attributed to contaminated drinking water by the seepage of animal
manure in the drinking water supply. Recreational activities like swimming, fishing and camping
can be ruined. The long term consequence is the damage to aesthetic and intangible attributes of
the streams and destruction of the economic value of clean natural waters.
Hog production in the country has increased drastically in recent years due to rapid
increase in population and therefore meat requirements and the waste generated becomes
unmanageable. The Philippines produces 7.589 million metric tons of hog manure alone in
19997.
The raw material for biogas production must contain organically bound carbon and the
element nitrogen which is needed by the bacteria responsible for biogas production.
Animal manure contains a portion of volatile (organic) solids which are fats,
carbohydrates, proteins, and other nutrients that are available as food and energy for the growth
and reproduction of anaerobic bacteria. Pig manure is the commonly used principal raw material,
since more biogas can be generated from pig manures composition. Biogas generation from
these wastes has been proven to be technically feasible, economically viable and socially
desirable and since our study is mainly within Hi-grade Farm, pig manure is readily available.
10
Input slurry (diluted manure) in one day will be completely digested after 10 days
producing total of 235.73 m3 gas based from the material balance
The gas produced per day is uniform in volume meaning 23.573 m3 gas/day
11
H2O = 58,860 kg
FINAL OUTPUT
INPUT
BG = 235.73 m3
Sludge = 94,254.48 kg
Solid = 9810 kg
Liquid = 29,430 kg
12
INPUT
H2O = 58,860 kg
INPUT
Solid = 9810 kg
Liquid = 29,430 kg
DILUTION
TANK
OUTPUT = 98100 kg
Diluted Manure
DIGESTER
OUTPUT = 94,254.48 Kg
Sludge
INPUT = 98,100 kg
Diluted Manure
OUTPUT = 235.73
m3
Biogas
13
Process Flowchart
Water
Biogas
Manure
DILUTION
TANK
Diluted
Manure
DIGESTER
Sludge
14
Equipment Specification
P-3
P-2
V-2
V-2
P-4
P-1
Figure 4.4
Equipment
Specification
15
Pipeline List
Displayed Text
Material
Diameter
P-1
P-2
P-3
P-4
Polyethylene Pipe
Polyethylene Pipe
Natural Rubber
Polyethylene Pipe
50.95 mm
20 mm
20 mm
50.95 mm
Length
0.40
1.40
0.40
1.40
m
m
m
m
Displayed Text
V-1
V-2
5 Elbows
Gate Valve
Gate Valve
90 degrees
16
ENVIRONMENTAL STUDY
Biogas Production for Hi-Grade Feeds
I. Project Description
A. Basic Information
Upon proper approval, this project, the biogas production will be implemented on
July 2006 and it will be located in Bocaue, Bulacan. Generally, the people living within the
municipalities of Bulaon, Del Rosario, Dolores, Malino, Malpitic, Marmatad, San Nicolas,
Santo Nino, Quebiawan, and Telabastagan are the stakeholders or the persons who may be
significantly affected by the project. This project will be financed by the owners of the HiGrade Feeds.
17
B. Project Rationale
While maximizing biogas output from available waste materials is very significant,
maximizing the use and application of the gas deserve equal importance.
For direct heating applications, biogas is used for cooking and brooding lamps
in heating chicks and piglets in livestock farms, for torch using fire
disinfectant in piggery pens to replace chemical disinfectant
For typical family use, biogas can be used for ironing, and as a fuel for gas
mantle lamps, absorption-type refrigerator, in addition to cooking
As fuel for internal combustion engines, biogas can be used as substitute for
diesel or gasoline. It has a higher octane rating than both conventional
petroleum fuels
As feed for raising fish, for vermiculture (earthworms), and for pigs
As soil conditioner
Advantages
Organic wastes are reduced by 50% and relatively safe for disposal
Effectiveness of the system all year round without the need of artificial
heating or expensive insulation of the digesters because of the
Philippine climate
18
Disadvantages
Mountains interposes the free movement of air resulting to a dry with scanty rain during the
period. While from May to September, the southeast monsoon prevails strong winds and
abundant rainfall and generally associated with storm and typhoon
GEOGRAPHY
The western part of the province is generally flat and is drained by the Angat and
Pampanga Rivers. Part of the western boundaries touches the extensive Candaba Swamps
which mark the pronounced depression in range.
POWER SOURCE
Bocaue is fully dependent to MERALCO for its electrical power needs. Survey
results showed that 90% of the total households in the municipality are already serviced by
the said company.
III Environmental Impact
Life Cycle Assessment
H2O = 58,860 kg
Solid = 9,810 kg
Liquid = 29,430 kg
BG = 235.73 m3
Sludge = 94,254.48 kg
20
1. Air Impacts
a.
CH4
Methane (CH4) is a greenhouse gas that remains in the atmosphere for approximately
9-15 years. Methane is over 20 times more effective in trapping heat in the atmosphere
than carbon dioxide (CO2) over a 100-year period and is emitted from a variety of
natural and human-influenced sources. Human-influenced sources include landfills,
natural gas and petroleum systems, agricultural activities, coal mining, stationary and
mobile combustion, wastewater treatment, and certain industrial process.8
b.
H2S
Hydrogen sulfide is a colorless gas with an offensive stench and is said to smell like
rotten eggs. The gas can be detected at a level of 2 parts per billion.. Just a few breaths
of air containing high levels of hydrogen sulfide gas can cause death. Lower, longerterm exposure can cause eye irritation, headache, and fatigue.
c.
CO2
Carbon dioxide is a colorless, odorless, faintly acidic-tasting, and non-flammable gas
at room temperature.
2. Water Impacts
a. NH4
Ammonia is a gas that occurs naturally in the environment and is also manmade.
From the biogas production, ammonia will come from the sludge withdrawn in the
21
digester. Ammonia is irritating to the skin, eyes, nose, throat, and lungs. Exposure to
high concentrations can cause serious burns.9
IV. Impact Mitigations or Enhancement Plan
1. Air Impacts
a. CH4
Methane (CH4) in this process is directly used after production of biogas. Pipes from
digester to the burner will be periodically checked and make sure that there is no leakage
2.
Water Impacts
These compounds can be used as liquid fertilizer for the field.
VI. Reference:
Books:
URLs:
http://asiatravel.com/manila/pampangamap.html
www. askjeeves.com/glass/manufacturing.html
www. emb.gov.ph
www.encyclopedia.com
22
Material Name:
Methane
Chemical Formula:
CH4
Synonyms:
Composition/Information on Ingredients
CAS Registry
Molar (volume)
Number
concentration
74-82-8
100%
Component
Exposure Guidelines
Simple Asphyxiant
Methane
(ACGIH)
Hazards Identification
Emergency Overview
Methane is a colorless and odorless gas. It is not toxic; the immediate health hazard is
that it may cause thermal burns. It is flammable and may form mixtures with air that are
flammable or explosive. Methane is violently reactive with oxidizers, halogens, and some
10
23
halogen compounds. The concentrations at which flammable or explosive mixtures form are
much lower than the concentration at which asphyxiation risk is significant.
Potential Health Effects 11
Routes of Exposure: Methane is not toxic by any route. Asphyxia may result if the oxygen
concentration is reduced to below 18% by displacement.
Lengths of Exposure: None of the available data indicate toxicity for exposures of any
duration.
Severity of Effect: No effect identified.
Target Organs: None identified.
Type of Effect: No effect identified.
Signs and Symptoms of Exposure: None identified.
Medical Conditions that may be Aggravated by Exposure: None identified.
Reported Carcinogenic and Reproductive Effects: None known to Voltaix, Inc.
First Aid Measures12
Asphyxiation
This is the primary health risk.
Remove the affected person from the gas source or contaminated area. Note: Personal
Protective Equipment (PPE), including positive pressure, self contained breathing
apparatus, may be required to assure the safety of the rescuer. The concentration
required for asphyxiation is above the upper flammable limit. A boundary region, in
11
12
24
the flammable range, may exist between contaminated and uncontaminated areas.
Take appropriate precaution against ignition of the atmosphere in this region.
If medical oxygen and appropriately trained personnel are available, administer 100%
oxygen to the affected person.
Keep the affected person warm, comfortable, and at rest while awaiting professional
medical care. Monitor the breathing and pulse continuously. Administer rescue
breathing or CPR if necessary.
Skin Contact
No detrimental effect of skin contact has been reported. Treat thermal burns by
assuring that affected area is cool by flushing with cool water, then apply dry sterile
dressings. If the patient is burned on the face, neck, head, or chest, assume that the airway
may also have been burned and obtain professional medical assistance immediately.
Eye Contact
No detrimental effect of eye contact has been reported.
Ingestion
Ingestion is not an observed route of exposure to gaseous hazardous materials.
Note to Physicians:
The combustion products of methane and air are water and carbon dioxide. Under
some conditions, carbon monoxide may also be produced.
25
26
Toxicological Information
Acute Data (by route): None, methane is a simple asphyxiant.
Chronic and Subchronic Data: No information on its carcinogenicity or other effects is
included.
27
FINANCIAL STUDY
GANTT Chart
No.
Activities
Feb
1
2
3
4
5
6
7
8
9
March
2006
April-June
July
August
July
2014
May
June
July
Completion of Study
Proposal and Approval
Purchasing of Materials
Recruitment and Hiring of Laborer (Equipment
Construction)
Land Development
Equipment Construction
Recruitment and Hiring of Personnel
Trial Run
Start of Operation
A Gantt chart is a popular type of bar chart that aims to show the timing of tasks or activities as they occur over time. It can show
when the project terminal elements start and finish.
28
May
22742
180000
Total
Amortization
202742
40548
Qty
Days
4
60
1
10
5
180000
Salary/day
400
6000
Benefits
100
Total Compensation
120000
60000
Amortization is the distribution of a single lump-sum cash flow into many smaller cash flow installments, as determined by an amortization schedule.
Amortization is chiefly used in loan repayments (a common example being a mortgage) and in sinking funds. Payments are divided into equal amounts for the
duration of the loan, making it the simplest repayment model.
29
2006 2007
2008
1100 1111 1122.11
40548 40548 40548
41648 41659 41670
2009
1133.33
40548
41682
2010
1144.664
40548
41693
2011
1156.11
2012
1167.672
2013
1179.35
2014
1191.14
2015
1203.054
1156
1168
1179
1191
1203
30
CONSTRUCTION COST
MATERIALS
Gravel
Quantity
4.56 m3
Amount/unit
P969
Cost
4419
Portland cement
Plywood (formers)
571 bags
20
P165/bag
P320/pc
94215
6400
40 kilo/bag
(1/4 x 4 x 8 ft)
3 pcs
P3,500
10500
150 pcs
P300/pc
45000
200 L
Gas Burner
4 pc
P3,000
12000
Sand
11.4125
ton
51 pcs
P350/ton
3994
P350/pc
17850
Others:
Stainless Steel
(Cover)
Drums (boiling
water &
transportation
manure)
Reinforcement bar
Total Amount
Specification
25-70kg/m2
194378
31
PIPES
Quantity
1
Amount/unit
P210/10ft
Cost
210
PE Pipe
P180/10ft
540
Valves
300
Elbows
P100/pc (2
diameter)
P150/pc (4
diameter)
P25/pc
Flexible Hose
Total Amount
Grand Amount (Materials and Piping)
125
Specification
2 inches
diameter
2 inches
diamter
2 and 4 inches
diameter
90 degrees 2
inches diameter
1175
195553
Labor Cost
Supervisor
Laborer
cover
Qty
1
10
Days
22
22
Salary/day
406
325
Benefits
102
81
Total
Compensation
11172
89375
8000
32
Equipment Cost
Digester
TOTAL
Volume (m3)
173
Area (m2)
25
Length (m)
9
Witdth (m)
9
Height (m)
2
Cost(2006)
304100
304100
Cost(2014)
397319
397319
* digester's cost in 2014 make use of CPI (Consumer Price Index), Source NSO (National Statistics Office)
Cost
360000
396000
435600
479160
527076
579784
637762
701538
771692
848861
*Vehicle rent is 30000/month for the 1st year and 10% incerease
every year
33
Laborer
Driver
Supervisor
assumption
Laborer
Driver
Supervisor
TOTAL
Rate/day
Benefits
Total/day
No. of
Days
No. of
Personnel
Salary/yr
325
325
406
81
81
102
406
406
508
22
22
22
2
2
1
214500
214500
134063
2007
220935
220935
138084
579954
2008
227563
227563
142227
597353
2009
234390
234390
146494
615274
2010
241422
241422
150889
633732
2011
248664
248664
155415
652744
3% increases/yr
2006
214500
214500
134063
563063
2012
256124
256124
160078
672326
2013
263808
263808
164880
692496
2014
407583
543444
169826
1120854
2015
629716
1119495
174921
1924133
34
DEPRECIATION
ASSET(2006)
Biogas
Digester
Assets (2014)
Digester
Qty
COST
ESTIMATED LIFE
DEPRECIATION/YR
304100
50
6082
397319
ESTIMATED LIFE
42
9460
Depreciation is an accounting and finance term for the method of attributing the cost of an asset across the useful life of the asset. Depreciation is an example
of applying the matching principle as per generally accepted accounting principles.
35
digester
3041
15205
15965
16764
17602
18482
19406
20376
21395
22465
digester(2014)
3973
7946
truck
3600
7200
7560
7938
8335
8752
9189
9649
10131
10638
truck(2014)
7717
15434
TOTAL
6641
22405
23525
24702
25937
27233
28595
30025
35499
41049
36
km
40
40
40
40
40
40
40
40
40
40
40
no. of trips/day
5
5
5
5
5
5
5
5
10
10
10
Cost/L
31
33
35
37
39
40
42
44
46
48
50
Cost/day
954
1011
1070
1128
1187
1245
1304
1363
5686
5920
6155
Cost/yr
248000
262828
278077
293327
308577
323826
339076
354326
1478301
1539300
1600299
*1L
diesel/10km
37
Revenue
Year
preoperation
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
Sales(m3/day)
Selling Price(php/L)
24
24
24
24
24
24
24
24
47
47
25
25
26
28
30
31
33
34
36
37
39
Sales(Php/day) Sales(Php/yr)
5344
5344
5664
5992
6321
6650
6978
7307
7636
15928
16585
1389505
1389505
1472582
1558023
1643465
1728906
1814348
1899789
1985231
4141345
4312228
38
Beginning Inventory
0
26
26
26
26
26
26
26
26
26
51
Production Sales(m3/day)
24
24
24
24
24
24
24
24
47
47
24
24
24
24
24
24
24
24
47
47
Ending Inventory
26
26
26
26
26
26
26
26
26
51
51
In business management, inventory consists of a list of goods and materials held available in stock.
39
Project cost
2006
Fixed Capital Expenditures
Equipment
Production Equipment
Total
Pre-Operating Expenses
Trial-run cost
Pre-operating salary and wage (design
team)
304100
304100
22742
180000
*No working capital is included in the project cost because on the fist day of operation we already have a savings which could suffice the cost of operation.
*No working capital is included in the project cost because on the fist day of operation we already have a savings which could suffice the cost of
operation.
40
Manufacturing Cost
Cost of Production
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
Raw Materials
Manure
248000
262828
278077
293327
308577
323826
339076
354326
1478301
1539300
Manpower
Supervisor
Driver
Laborer
Total
134063
214500
214500
563063
138084
220935
220935
579954
142227
227563
227563
597353
146494
234390
234390
615274
150889
241422
241422
633732
155415
248664
248664
652744
160078
256124
256124
672326
164880
263808
263808
692496
169826
543444
407583
1120854
174921
1119495
629716
1924133
17520
18396
19316
20282
21296
22360
23478
24652
25885
27179
3041
15205
15965
16764
17602
18482
19406
20376
25368
30411
3600
6641
7200
22405
7560
23525
7938
24702
8335
25937
8752
27233
9189
28595
9649
30025
10131
35499
10638
41049
6082
6082
6082
6082
6082
6082
6082
6082
15542
15542
360000
396000
435600
479160
527076
579784
637762
701538
771692
848861
Electricity
Repair and
Maintenance
Digester
Vehicle Rent
(Truck)
Total
Depreciation
Digester
Vehicle rent
(truck)
41
Total
366082
402082
441682
485242
533158
585866
643844
707620
787234
864403
Licenses &
Insurance
Registration
Total
10000
10000
10000
10000
10000
10000
10000
10000
10000
10000
10000
10000
10000
10000
10000
10000
20000
20000
20000
20000
1211305
1295665
1369953
1448826
1532699
1622030
1717320
1819119
3467774
4416064
Total
Manufacturing
Cost
Beginning
inventory
finished goods
Ending
inventory
finished goods
4659
4983
5269
5572
5895
6239
6605
6997
13338
4659
4983
5269
5572
5895
6239
6605
6997
13338
16985
COST OF SALES
1206647
1295341
1369668
1448522
1532376
1621686
1716953
1818727
3461433
4412417
*5% INCREASE IN
ELECTRICITY
Cost of sales is an economical term describing the sum of all expenses that directly contribute to the generation of revenue. The cost of sales for a
merchandising firm typically includes the cost of the inventory sold, warehouse and transportation costs, and other costs associated with bringing inventory to
stores. It does not include costs associated with retail stores, and wages for retail employees.
42
INCOME STATEMENT
Revenue
Cost of Sales
Operating Profit
Administrative
and Marketing
Profit before
Income Tax
Income Tax
Profit after
income Tax
2006
1389505
1206647
182858
2007
1472582
1295341
177241
2008
1558023
1369668
188356
2009
1643465
1448522
194942
2010
1728906
1532376
196530
2011
1814348
1621686
192662
2012
1899789
1716953
182836
2013
1985231
1818727
166504
2014
4141345
3461433
679913
2015
4312228
4412417
-100188
41648
41659
41670
41682
41693
1156
1168
1179
1191
1203
141210
49424
135582
47454
146685
51340
153261
53641
154837
54193
191506
67027
181669
63584
165324
57864
678721
237553
-101391
-35487
91787
88128
95345
99620
100644
124479
118085
107461
441169
-65904
Revenue is used worldwide to measure increase of assets or decrease of liabilities during an accounting period. A synonym of revenue in accounting
terminology is income.
2
Income statements for companies indicate how Net Revenue (money received from the sale of products and services before expenses are taken out, also known
as the "top line") is transformed into Net Income (the result after all revenues and expenses have been accounted for, also known as the "bottom line"). The
purpose of the income statement is to show managers and investors whether or not the company made or lost money during the period being reported.
43
Balance Sheet
Assets
Cash
Inventories
Finished Goods (EI)
Others
Equipment
digester
Total
Depreciation
digester
Total
Book Value
digester
Other assets pre-op
expense
Total assets
Liabilities
Income Tax
Accounts payable
Total
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
185287
319138
464885
613313
761005
904254
1024819
1132467
1365767
1039289
4659
4983
5269
5572
5895
6239
6605
6997
13338
16985
304100
304100
304100
304100
304100
304100
304100
304100
701419
701419
701419
701419
12164
12164
18246
18246
24328
24328
30410
30410
36492
36492
42574
42574
48656
48656
64198
64198
79740
79740
298018
291936
285854
279772
273690
267608
261526
255444
637221
621679
162193
121645
81097
40548
650157 737702 837105 939205 1040590 1178100 1292950 1394908 2016326 1677953
49424
2105
51529
47454
3493
50946
51340
3664
55003
53641
3843
57484
54193
4031
58224
67027
4229
71256
63584
4437
68021
57864
4655
62518
237553
5215
242767
44
-35487
5786
-29701
506841
0
91787
91787
506841
91787
88128
179915
506841
179915
95345
275260
506841
275260
99620
374880
506841
374880
100644
475524
506841
475524
124479
600003
506841
600003
118085
718087
506841
718087
107461
825548
506841
825548
441169
1266717
506841
1266717
-65904
1200813
982365
650157 737702 837105 939205 1040590 1178100 1292950 1394908 2016326 1677953
Asset is anything owned which can produce future economic benefit, whether in possession or by right to take possession, by a person or a group acting together, e.g. a company, the measurement of
which can be expressed in monetary terms. Asset is listed on the balance sheet. It has a normal balance of debit.
2
Net Book Value is the original acquisition cost, less accumulated depreciation, depletion or amortization. Book value is therefore relevant insofar as it forms the basis of various calculations e.g. of
nominal capital gains (current value divided by book value), of amortized value (book value adjusted for depreciation) and of several financial ratios (e.g. price to book value P/BV).
3
A financial liability is something that is owed to another party. This is typically contrasted with an asset which is something of value that is owned. The basic accounting equation relates assets,
liability, and capital in the form of equity:
4
the shareholders' equity refers to the amount of assets that are owned by a company's shareholders. However, there is much more to this value. Stockholder's equity is perhaps the most abstract
concept to grasp in terms of the accounting equation when compared to its counterparts: assets and liabilities.
5
A balance sheet, in formal bookkeeping and accounting, is a statement of the book value of a business or other organization or person at a particular date, often at the end of its "fiscal year," as
distinct from an income statement, also known as a profit and loss account (P&L), which records revenue and expenses over a specified period of time.
45
Cash Flow
Profit
Add back:
Depreciation
amortization of pre optg
expense
Increase (decrease) in current
liabilities
Decrease (increase) in non-cash
current assets
Total cash receipt from
operations
2006
91787
2007
88128
2008
95345
2009
99620
2010
100644
2011
124479
2012
118085
2013
107461
2014
441169
2015
-65904
6082
6082
6082
6082
6082
6082
6082
6082
15542
15542
40548
40548
40548
40548
40548
51529
-582
4057
2481
740
13032
-3235
-5503
180249
-272468
-4659
-324
-286
-303
-323
-344
-367
-392
-6341
-3647
185287
133852
145747
148427
147692
143249
120565
107649
630619
-326478
Less disbursements
additional equipment
397319
397319
185287
0
185287
133852
185287
319138
145747
319138
464885
148427
464885
613313
147692
613313
761005
143249
761005
904254
120565
904254
1024819
107649
1024819
1132467
233300
1132467
1365767
-326478
1365767
1039289
In finance, cash flow refers to the amounts of cash being received and spent by a business during a defined period of time, sometimes tied to a specific project.
46
Breakeven
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
1206647
1295341
1369668
1448522
1532376
1621686
1716953
1818727
3461433
4412417
Revenue
Sales bunker (L/day)
Selling price
214
22
214
23
214
25
214
26
214
28
214
29
214
31
214
33
428
31
855
20
Break-even price
22
23
25
26
28
29
31
33
31
20
25.00
186
25.00
199
26.49
199
28.03
199
29.57
199
31.11
201
32.64
202
34.18
205
35.72
373
37.26
456
186
199
199
199
199
201
202
205
373
456
12
6000
11
5750
11
5650
11
5450
11
5400
10
5300
10
5250
10
5250
11
5500
17
8500
Cost of sales
Revenue
Selling Price
Sales bunker (L/day)
Break-even volume
bunker (L/day)
Break-even volume BG
(m3/day)
Break even no. of pigs
The breakeven point in economics is the point at which cost or expenses and income are equal - there is no net loss or gain, one has "broken even"
47
ROI
PAIT
i
(1+i)^n
sum
diff (equity and PAIT)
Interest (%)
2006
91787
0.175
1
78116
503188
-3,654
17.5
2007
88128
2008
95345
2009
99620
2010
100644
2011
124479
2012
118085
2013
107461
2014
441169
2015
-65904
1
63832
2
58774
2
52263
2
44937
3
47301
3
38188
4
29577
4
103339
5
-13138
In economics the rate of return on investment refers to the benefits to an investor (the profit) relative to the cost of the initial
investment. It is similar to the rate of profit as a measure of profitability.
48
Payback Period
Equity
Year
Profit to date
506841
2006
91787
91787
Payback period
2007
88128
179915
2008
95345
275260
4.4
yrs
2009
99620
374880
2010
100644
475524
2011
124479
600003
2012
118085
718087
2013
107461
825548
2014
441169
1266717
2015
-65904
1200813
PBP is a measure of the speed with which an investment is recovered by the cash inflows it produces
49
The decrease in bunker fuel usage of Hi-grade feeds for the boiler is our major concern in
our study. In accordance with this, we have made a proposal study which considers all
factors of the farm and present technology that they are using.
After our market, technical and financial study of biogas from pig manure we came up
the following conclusions:
Hi-grade farms could increase the value of there waste by converting it to biogas
Biogas can be used to save bunker fuel usage by pre-heating the water entering
the boiler
The profit on the biogas system is good because it will save amount of bunker
fuel
Removal of sulfur and carbon dioxide in the biogas which will increase its value
because it can be stored in a tank and can be sold
50
Building a digester that will meet the demand of year 2010 at the start of the
project. The purpose of building an additional digester is to meet the demand on
the feed mill as well as the supply of hog manure. The demand and supply is
based on the information given to us by Engr. Teresita P. Madulid. At this year
the number of hogs are already doubled, resulting to a 24,000 number of hogs.
Possibility of transferring the boiler to the farm which means that some part of the
process in the feed mill will also be transferred.
51
APPENDIX
MATERIAL BALANCE
Number of pigs: 12,000
Manure per day of pig: 3.27 kg
Basis: 1 day operation
Weight manure = 39,240 kg
Pre-treatment (Dilution)
- Dilution occurs in pig pens
Manure contains25% solid and 75% liquid
Wt. of solid (A) = (39,240 kg)(0.25)
= 9,810 kg
Wt. of liquid (B = (39,240 kg)(0.75)
= 29,430 kg
- Diluted solution must only have 10% solids
C (H2O)
A, B, C
A, B
X=A+B+C
Solid Balance:
9,810 = 0.10x
x = 98,100 kg
X=A+B+C
98,100 = 9,810 + 29,430 + C
C = 58,860 kg
Digestion
X
BG
Digester
Sludge (Y)
Biogas Computation:
- Volatile solids (VS) is 80% of total manure solids
- Only 49% of VS is broken down by bacteria
- 0.0613 m3 gas per kg volatile solid
52
VS = (9,810 kg)(0.8)
= 7,848 kg volatile solid
Amount broken down by bacteria = (7,848 kg VS)(0.49)
= 3,845.52 kg
Volume of Biogas produced = (3,845.52 kg)(0.0613 m3/kg)
= 235.73 m3
Y = (A broken down by bacteria) + B + C
= (9,810 3,845.52) + 29,430 + 58,860
= 94,254.48 kg
53
Sludge
amount of sludge = 94,254.48 kg
volume of sludge = 94,254.48 kg x __m3__
997.32 kg
= 94.508 m3
54
Vd = 1.177 10 L
Hs := 3.05m
Lh :=
Vd
Hs
Lh = 6.211m
Hbg :=
Vbg
( Lh Wh )
Hbg = 0.914m
55
20 km
430 kilo/hr
50 L/hr
Assumptions
Time value of money is not considered
Minimum wage is P325 per person
Operation Schedule
Mondays through Fridays (22 days a month)
Sixteen hours work per day
Basis of computation
Transportation:
A diesel engine will use 1L per 13 m
Diesel price is P31/L
Bunker fuel is P23/L
Computation for final temperature upon pre-heating
Given:
23.573 m3 BG/day
Basis: 1 hour
Solution:
1kg CH4 x 1 kmol CH4 x 1000 mol
23.573 m3 BG x 0.6 parts CH4 x
1 part BG
0.68 m3 CH4 16.043 kg CH4 1 kmol
= 1,296.497 mol CH4
Hrxn methane = -890.4 kJ/mol
q = -890.4 kJ/mol CH4 (1,296.497mol CH4)
= -1,154,400.929 kJ
considering heat loss of 50%,
Since qmethane = qwater,
qwater = mcpT
577,200.465 kJ = (430 kg/hr)(16hr/day)(4.186 kJ/kgK)(T-25)
T = 45.04 C
Therefore the possible temperature that the water can be heated is
T = 45.04 C
Computation of the bunker fuel used
Existing process (without pre heating)
q = mcpT + latent heat
= (430 kg/hr)(16hr/day)(4.186 kJ/kgK)(100-25) + 88.0 kJ
q = 2,160,064 kJ/day
This amount of heat consumes 800 L/hr bunker fuel or 2,700.08 kJ/L.
56
FINANCIAL STUDY
PRE-OPERATING EXPENSES
Trial run = (62*10) + [(406+406+508) * 10
= 13,823
Pre-operating salary and wages:
= total compensation design team + total compensation of project consultant
= 180000 + 120975
= 300975
TOTAL:
= Trial run + Pre-operating salary and wages
= 13823 + 300975
= 314798
AMORTIZATION:
= Total/5
= 314798/5
= 62960
ADMINISTRATIVE AND MARKETING
For year 2006:
Office Supplies = 1200
Amortization (Pre-Operation) = 62960
TOTAL:
= Office Supplies + Amortization
= 1200 + 62960
For year 2007:
Office Suppplies = (12000)*(1.01) = 1212
Amortization = 62960
TOTAL = 64172
PRE-OPERATING SALARIES WITH BENEFITS
57
58
= 326653
Truck = 2000000
TOTAL = Cost (2006) + Truck = 326653 + 2000000 = 2326653
Cost (2014)
= Cost (2006)/ [(CPI 2014/CPI 20006)]
= 2326653 / [(275.961/211.215)]
= 426785
TOTAL = 426785
DEPRECIATION
For year 2006
BIOGAS: Digester
Quantity = 1
Cost = 326653
Estimated Life = 50
Depreciation (per year)
= cost / estimated life
= 326653/50
= 6533
BIOGAS: Delivery Truck
Quantity = 1
Cost = 2000000
Estimated Life = 10
Depreciation (per year)
= cost / estimated life
= 2000000/10
= 200000
For year 2014
Digester
Quantity = 1
Cost = 426785
Estimated Life = 50
Depreciation
= cost / estimated life
= 426785/50
= 8536
REPAIR IN MAINTENANCE
For year 2006:
Digester
59
60
= 2326653
COST OF SALES
For the year 2006
Raw Materials:
Manure = 16368
Manpower:
Supervisor =134063
Driver = 107250
Labourer = 107250
TOTAL = summation of manpower = 348563
Electricity
= 25*20*12*365*10/1000
= 21900
Repair and Maintenance:
Digester = 3267
Truck = 20000
TOTAL = summation of repair and maintenance = 23267
Depreciation:
Digester = 6533
Truck = 200000
TOTAL
= summation of depreciation = 6533 + 200000 = 20653
Licenses and Insurance
Registration = 10000
Insurance = (production equipment)*(0.01)+(10000)
= (326653)*(0.01) + (10000)
= 13267
TOTAL = summation of licenses and insurance = 10000 + 13267 = 23267
Total Manufacturing Cost
= manure + summation of manpower + electricity + summation of repair and
maintenance + summation of depreciation + summation of licenses and insurance
= 16368 + 348563 + 21900 + 23267 + 20653 + 23267
= 639897
Beginning Inventory of finished good = 0
Ending Inventory = total manufacturing cost / (52*5)
= 639897 / (52*5)
= 2461
Cost of Sales
= total manufacturing cost + beginning inventory of finished good ending inventory
61
= 639897 + 0 2461
= 637435
INCOME STATEMENT
For year 2006
Revenue = 1278345
Cost of Sales = 637435
Operating Profit = Revenue Cost of Sales
= 1278345 637435
= 640910
Administrative and Marketing = 64160
Profit Before Income Tax = operating profit administrative and marketing
= 640910 64160
= 576750
Income Tax = (0.35)* profit before income tax
= 201862
Profit after income tax = profit before income tax income tax
= 576750 201862
= 374888
62