March 1, 2009

Update: What’s That Scrubber Going to Cost?

George W. Sharp

3.    Make your choice. Although all of the FGD units reported on in the current survey were of the limestone forced oxidation technology, almost two-thirds were of the spray type, and a third were jet bubbling reactors. Source: EUCG

4.    Capture the SO₂. The average FGD SO₂ removal design point is about 4.5 lb of SO₂ removed per million Btu of fuel consumed. Source: EUCG

Cost Survey Results

Average total installed costs reported by the survey respondents were expected to have wide variation, principally because of the peculiarities that exist at each project site, the retrofit project complexity, and the timing differences between projects. Therefore, defining an average project cost is difficult without some understanding of the project-specific details of each of the 78 units surveyed. A look at the summary or "fully loaded" installed costs clearly shows that costs continue to rise (Figure 5) and continue to stay consistently above $300/kW. The data clearly show there are economies of scale for larger plants, but they are not as pronounced as you might expect.

5.    Big bucks. “Fully loaded” FGD system capital costs were reported by unit rating and show a significant increase since the previous survey. Source: EUCG

The survey data go into much more detail, although the in-depth data are restricted to those that participated in the survey. However, we can take one more step and strip out the FGD-only costs from the installed cost data to evaluate system-only cost changes since the 2007 survey.

The survey instructions requested that respondents define project costs for their just-completed, current, under construction, and/or planned FGD projects and that they include the following line items, at a minimum, so that comparable data were reported that could be compared across projects:

• Project design costs

• New stack and ductwork costs

• Reagent prep method and costs

• Absorber island/reactor technology costs

• Site prep costs

• Wastewater treatment costs

• Balance-of-plant costs

• Other direct costs (such as engineering and project management)

• Associated boiler work (such as boiler modifications and draft fans)

Comparing these costs to the "FGD only" cost summary, we begin to see some of the economies of scale expected for projects of this size, although they are not as pronounced as might be expected (Figure 6). The FGD-only costs were calculated as the sum of the FGD absorber reactor costs, reagent preparation system costs, the FGD waste disposal system costs, and the balance-of-plant cost. Stacks, site preparation, wastewater systems, and other project costs for boiler cleaning systems, coal blending or major electrical upgrades are excluded. This definition was refined before the current survey in order to obtain better cost data for the different cost categories.

6.    Costs have risen. Significant cost increases have occurred for “FGD system only” capital costs, yet the economies of scale do not seem to apply for units 600 MW and larger. Source: EUCG


7.    Reach for the sky. In the 2007 survey, “fully loaded” FGD system costs were much higher for preliminary engineering than for later phases and already completed FGD projects. The 2008 survey shows fully loaded costs to be very flat and independent of project phase. Source: EUCG

Total project costs reported in the 2008 survey were approximately 28% higher than those reported in the 2007 survey (which used data from late 2006), representing an average annual escalation rate of 14%. The data also show a project cost escalation rate from 2006 to 2007 of approximately 22%. This number may seem large, but it is very similar to escalation rates for other major utility projects during the same period. Also, the 2008 survey shows essentially no difference in fully loaded project costs from conceptual design through start-up (Figure 7). The conclusion we draw is that FGD project installed costs may be rising significantly, but costs have become more predictable.

—George W. Sharp (gwsharp@aep.com) is vice president of EUCG and manager, business intelligence for American Electric Power's Generation Business Services Unit.