Life Cycle Cost Comparison of Heat Recovery Steam Generator and Auxiliary Boiler

The current practice of selection of industries equipment by the engineers and management is normally based on capital cost only. Operation costs are being ignored during the selection process, as the results of this practice, many issues on wrong decision making among engineers or management committee in the selection of equipment to be used in plant. From that, occurrence of unexpected and unregulated of flowing cost can happen which it is an objectionable matter by a company. Studied have found out that the operation cost can be as high as 70% of the total life cycle cost. Hence it will be more appropriate to compute the operational cost in selecting of industrial equipment. In this study, life cycle cost analysis has been highlighted. It is related to the analysis of life cycle cost of equipment that involve of capital expenditure and operational expenditure. The equipment that focused on are heat recovery steam generator and auxiliary boiler. Both equipment is generating the same output but with different process, hence the cost that is required to carry out each process will be assessed for comparison. The cost that are involve for comparison are initial cost, fuel cost, maintenance cost, operational cost and salvage cost. All the cost data is based from Petronas Gas District Cooling (GDC), from January 2016 to July 2016. The calculation process in this study contain the use of present worth analysis (PW), with the illustration of cash flow diagram. In order to have the near precise results of life cycle cost analysis for the both equipment, a cost estimation technique is used and there are several other cost estimation techniques discussed in this study.