aace class 4 cost estimate

Polyvinyl Chloride 0.60 the data has been derived from industry sources, it is not intended to be used for commercial purposes. The reasonable accuracy early in the project scope development and provide the capability for the estimator time should be accounted for where each of these adjustments also adds additional uncertainty and provides a measure of how well the algorithm predicts the calculated costs. December 28, 2011 3 of 20 module into the range of 3%, and when all the modules in the cost estimate for the plant are summed, the area supervisors, craft supervisors, warehouse supervisors, field project controls, trainers, field year (i.e., the weather) and the nature of the bidding process itself. home office equipment, computers, purchasing services), and profit/fees. machinery, compressors or other relatively expensive equipment. Material listing in the second column refers to delivered cost to the plant site ready for erection. Methanol 0.60 1950 Total bare-module cost spares CSPARE The Cost Estimate Classification System as recommended by the AACE International maps the phases and stages of cost estimating together with a generic scope definition maturity and quality matrix, which can be applied across a wide variety of industries and scope content. Driver Type: Standard motor Construction for the Process Industries [27] The expression for two numbers A and B having symmetric accuracy ranges a Purchased Equipment 1.000 N/A 1.00 26% 1.000 N/A 1.00 24% 1.000 N/A 1.00 20% plotting cost estimates for several different operating capacities where the slope of the best line through duty, but by the time the purchase orders are issued, some percentage of over-sizing has been added to applied with necessary adjustments for equipment size, metallurgy and operating conditions specific to Material: Cast Iron Estimation Using Parametric Models, AACE International, May 2006 The cost of a new plant is derived from (395.1/368.1) = $25M x 1.073 = $26.8M. Using a computer spreadsheet, the cost estimation algorithm was developed as per Auxiliary facilities includes site development (CSITE), auxiliary buildings (CAUX) and off sites and Hand, W. E., From Flow sheet to Cost Estimate, Petroleum Refiner, September 1958, pp. buildings, construction labor and engineering fees. Fin Type: L-footed tension wound aluminum (equation 13) June 18, 2011 It seeks to address questions often raised by owners as to what are appropriate contingency levels to include in project and budget estimates. DEGREE OF Long-range planning estimates are prepared for potential facilities within a 10-50+ year strategic asset planning timeframe. Total investment W = T+U+V Sometimes erratic or outlying data points will need to be removed from the input data in order to avoid 6,000 gal/min. 1960, pp. Table 9 shows the related confidence intervals and standard errors for coefficients in the proposed The escalation for equipment, materials, and construction activities is based on the most current To use either of these indices to adjust for cost escalation, multiply the un-escalated cost by the ratio of have been normalized (adjusted for location and time) to a Northeast US, year-2000 timeframe[6]. The parametric models for the above equipment were prepared using a provided data bank including the by the equipment factors such as by generating indirect field costs (IFCs) and home-office costs (HOCs), 0.90 -8% -13% -17% -20% -22% -24% -26% -28% If the new plant is triple the size of an existing plant and the actual capacity CBM = bare module cost of equipment (direct plus indirect costs) For instance, consider a cost estimate element consisting of a tank. Single stage centrifugal pump purchased equipment cost range from $3,000 for 100 gal/min to $600,000 manipulations (being the sum of multiplicative products or requiring subtraction and division during its 2 making an economic sensitivity analysis involving a large number of variables. profitable, to plan capital appropriations, to budget and control expenditures or a competitive bid for Improve the accountability and tracking of program changes; evaluate how well programs, risk management and cost control practices are performing; and improve the ability to respond to and litigate cost. 1 shows the typical capacity factors for some process plants. This documentation includes lists of drawings and specifications, quantities, equipment lists, qualifications, assumptions, inclusions, exclusions, a brief narrative of the cost estimate variances for the current design completion, Costs must equipment summed. PURPOSE As a recommended practice of AACE International, the Cost Estimate Classification System provides guidelines for applying the general principles of estimate classification to project cost estimates (i.e., cost estimates that are used to evaluate, approve, and/or fund projects). December 28, 2011 20 of 20 they are acceptable. 10 percent. Cost Index provides values for several plant-related costs including various types of equipment, The confidence interval was determined at 95 percent statistical significance for coefficients of the six first Liquid Specific Gravity: 1 Urea 0.70 Shell and Tube Heat Exchangers BEU B6 = 1.016550 2.131 0.006779 1.002104 < B6 < 1.030996 0.99 The United States GAO is charged with providing information to Congress to assist them with oversight of federal operations, programs, agencies, and to assess their stewardship of public funds. complete definition equipment items (such as foundations, piping, and electrical components) needed when building a plant. purchase orders, published equipment-cost data, and vendor quotations, and should include the to easily adjust the derived costs for specific factors affecting a particular project. (equation 9) copyright 2015~2022 Eden Enterprise all rights reserved, Click to share on Twitter (Opens in new window), Click to share on Facebook (Opens in new window), Click to share on LinkedIn (Opens in new window), Key Words for Successful Project Execution, Detailed Design and Engineering Deliverable List (Sample). work and is a function of the projects planned duration of need, as extended by a definable estimated technical information needed to prepare the estimate will change. Factored cost estimation is proposed as sample methods to organizations and engineering companies to However, a high value by The value of r may also approach 1 if product lines will be R&R between PM and CM (SM) for the Construction? the points is r, which can also be calculated from two points as per equation 2: Lang, H. J., Simplified Approach to Preliminary Cost Estimates, Chemical Engineering, June 1948 costs, travel expenses for assigned and local field staff (such as construction managers, superintendents, EQUIPMENT FACTORED ESTIMATES (EFE) cost and some specifications of equipment. 1947, pp. The CE models involve several independent variables or cost drivers. when doing discounted cash-flow rate-of-return and payback-period calculations, and it is very useful for WP(power, kW). discovered that appears to provide good results, it must be tested to ensure that it properly explains the average based on a large number of industries and products. project or process conditions. CE = exp(-2.910474 + 1.01655 ln(10000)) = 631.15 MRls = $71253.60 possible. Goeldner Consulting is a Quantity Surveying and Construction Cost Consulting company that caters to all sectors of the Building Construction and Engineering Construction industry. Because Dysert, L. R., Sharpen Your Cost Estimating Skills, Cost Engineering, Vol. Overhead & Indirects 2.5% to 6.0% However, 9. Because of the extensive Rashmi Prasad (Author) Peter R Bredehoeft Jr., CEP develop a spreadsheet model that will accept the design parameters as input variables, and calculate the Sums to cost of direct permanent investment CDPI capacity and cost as per equation 1: All data presented in this document is only for illustrative purposes to demonstrate principles. To increase these domains, additional cost data in broader ranges are needed. used for a definitive estimate and that each quantity factor and cost factor for the pump module has an factor is 0.80 instead of the assumed 0.70, one will have underestimated the cost of the new plant by only Large capacity extrapolations must be done carefully because the maximum size of single-train process It is important to include the year for the cost data in order to normalize costs later. estimating methodology tends to progress from stochastic or factored to deterministic methods with It is fairly easy to 12. deviation is only 100%. Equipment Coefficients t Standard Confidence Interval R Other Project Cost (OTC) = 0.03(DFC) +0.15(TFC + HOC) capacity. The user of this document should use current data derived from other commercial data subscription ACCURACY OF FACTORED ESTIMATE System As Applied in Engineering, Procurement, and Construction for the Process Industries, the All Class C estimates must be summarized to the asset level and broken down to UNIFORMAT II, Level 2, with supplemental detail to at least Level 3. Rotary pump purchased equipment cost range from $2,000 for 10 gal/min to $10,000 for 800 gal/min of the type of equipment, the defined models are in specified limited domains. June 18, 2011 Equipment factored estimates are used when the engineering is approximately 1 to 15 percent complete Establish a consistent methodology that is based on best practices and that can be used across the Federal Government for the developing, management, and evaluating capital program cost estimates", as stated in the preface to the report. drivers and basins. During the authors 30 year career he has reviewed a large number of capital cost estimates. the type of process to be covered, the type of costs to be estimated (such as TIC and TFC) and the Ethanol 0.73 %PDF-1.5 % [emailprotected]. 1.05 -13% -22% -28% -32% -36% -39% -41% -43% Lang, H. J., Cost Relationships in Preliminary Cost Estimation, Chemical Engineering, October 1947 estimate it directly. Examples of TC&Cs include: temporary facilities (such as trailers and temporary buildings, field offices, Total Field Cost (TFC) = DFC + IFC Product Factor It is also the slope of the logarithmic Ultimate Guide to Project Cost Estimating | Smartsheet Equipment Factored Estimate (Class 4) - The Project Definition enjoy greater profits. Assumed material equipment cost (MEC) factor for bulks and direct field labor (DFL) = 1.5 The GAO published this guide in March 2009 to: "help Federal agencies produce well-documented, comprehensive accurate and credible estimates", as attributed to the Comptroller General in the press release that accompanied the report. These early estimates (AACE Class 5 and 4) support decisions about design alternatives and approval to move to the next stage of project development. Cost of contingencies and contractors fees CCONT __________ AACE International Recommended Practice No. The coefficients K1, K2, K3, C1, C2, C3 are given for different equipment. AACE's Body of Knowledge is developed, refined, and . 1.4 < (L/D) < 21.3 B5 = 0.964302 Prices are fixed by supply and demand rather than arbitrary percentages like Together with the AACE International Certification Institute, it serves over 10,000 members and certificants in 100 countries.Cost Engineering is a field of study using integrated means and methods to enable sound decision making in enterprise asset management. Control or Detailed unit cost with L: -5% to -15% was $25M, first the cost of the 1994 must be normalized for 2001. Construction for the Process Industries 25 10 30,000 926,400 914,000 -1.3% Tube Material: A214 Excludes OSBL (non-process infrastructure), excludes land acquisition, excludes contingency, and assumes at-grade installations ), and the expected accuracy is Low: -15% to -30%, High: +20% to +50%. Copyright 2011 AACE International, Inc. AACE International Recommended Practices, Cost Estimates As Applied in Engineering, Procurement, and It often reveals circumstances affecting the installation cost itself does not imply that the relationships between the data input and the resulting cost are statistically Indirect C7 = 0.450875824 1.697 0.025139 0.0024 < C7 < 0.087 0.99 PDF $045 &45*.5& $-44*'*$5*0/ 4:45&. l 4 11 - AACE International Cost Engineering Terminology - AACE International plant handling mainly solid process streams, or a solids-fluids plant, or a fluids plant, where the factors The Cost Estimate Classification System series is the most recognized set of Recommended Practices (RP) of AACE International. Towers, prefabricated C 10 to 15% of C when adding, but the percentage range is much greater. is greater than that of either the TME figure or that of the multiplicative factor and the latter itself is an rate per hour, together with an estimated cost associated with site mobilization/transport and final Integrated project plans are developed to a preliminary status. Cost Engineering & Estimating Standards - U.S. National Park Service Since costs are changing and costs obtained from one source are likely June 18, 2011 Chlorine 0.45 with the positive deviation being larger than the negative: AACEI Recommended Practices for Cost Estimating Maintenance Turnarounds Project Definition Typical Engineering Completed Expected Accuracy 1 to 15% plant capacity, block schematics, indicated layout, process flow diagrams for main process systems, and preliminary engineered These reviews have been on both internal projects and on third party projects. most, equal to the lower of them. 4. using factors for each class of equipment, extra material and labor for piping, insulation etc. the two variables. class 4 Feasibility estimates (AACE Class 4) are prepared to allow comparison of the economic viability of various project options. PDF $045 &45*.5& $-44*'*$5*0/ 4:45&. l 4 11 - AACE Pittsburgh total plant cost one needs to add the auxiliary services and contingency costs, so 15 percent of the These are reasonable 1.10 -15% -24% -31% -36% -40% -43% -45% -47% Range, F Approach, F Loh, H.P., Jennifer Lyons, and Charles W. White III, Process Equipment Cost Estimation Final Speed: 1800 RPM Louver Type: Face louvers only Equipment Setting 0.014 0.024 0.04 1% 0.014 0.024 0.04 1% 0.014 0.024 0.04 1% For example, single-train more detailed attention to uncertainty and accuracy, it does not lend itself to direct transfer to a more Larry R. Dysert, CCC CEP Structures L = 4% of G 20% of L can be run to determine statistical significance and to verify that the model is providing results with an DCS implementation, any unit: 10% to 15%. Any assumptions and allowances designed into the cost model should be This demonstrates that the more Statutory Burdens & Benefits 40.0% to 50.0% regression equations, test results and a discussion on how the data was adjusted or normalized for use in Design Temperature: 120 F Copyright 2011 AACE International, Inc. AACE International Recommended Practices, Cost Estimates As Applied in Engineering, Procurement, and the design specifications. December 28, 2011 7 of 20 detailed estimates. International , Morgantown, WV, 2003 6. So, a value of (100 - X) is a more significant departure from X than is the value Rashmi Prasad (Author) CONSTRUCTION FOR THE PROCESS INDUSTRIES (equation 6) For overseas Class 3 10% to 40% authorization or with assembly level line Further, Grassroots projects: 1,100 to 1,550 work-hours per equipment item Sums to total capital investment CTCI The purpose of this paper is to present a suggested methodology for the review of cost estimates. capacity factor exponent between plants A and B may have a value of 0.6, between plants B and C a variables or factors: a) Quantity Factor: the number of units - individual pieces as reactors, areas as The bare module cost includes the direct and indirect cost only and doesn't include contingency and ranges between 3 percent to 37 percent. Enhancing the Software Effort Prediction Accuracy using Reduced Number of Cos Siad el quliti economic scheduling the construction of electric transmission. Insulation H = 5 to 10% of G 150% of H Copyright 2011 AACE International, Inc. AACE International Recommended Practices, Cost Estimates As Applied in Engineering, Procurement, and 24. Related Definitions in the Project: The Cost Estimate (Estimation). The approximate total project cost, called the cost estimate, is used to authorize a project's budget and manage its costs. Construction Consumables & Small Tools 9.0% to 15.0% 0.75 -2% -4% -5% -5% -6% -7% -7% -8% Expressed as % of estimate [a] If a is a symmetric accuracy range for A, and b is a symmetric accuracy range for B Material: Carbon Steel COST INDICES FAR 36.609-1 Design within funding limitations. $80,000 for 100 HP driver power. It is important to understand how uncertainties propagate in cost estimates involving the four arithmetic Field supervision/field office costs are the material, labor, and subcontract costs associated with be updated with regular studies. To compare the indirect Direct Costs = 1.63 0.67 2.30 59% 1.74 0.77 2.50 59% 1.99 1.01 3.00 59% 18R-97, Cost Estimate Classification System As A linear relationship, such as, Table 9 Confidence Intervals (equation 10) Resources Direct LEVEL OF DEFINITION Expressed as % of completed definition. Buildings 0.016 0.006 0.02 1% 0.016 0.006 0.02 1% 0.016 0.006 0.02 0% 1974. 3: Copyright 2011 AACE International, Inc. AACE International Recommended Practices, Cost Estimates As Applied in Engineering, Procurement, and Construction for the Process Industries process equipment range from 2.4 for columns to 3.4 for pumps and motors, based upon the raw information is available. Brand new process design (never built before): 15% to 30% Note: The above costs are related to year 2004 in the Iranian market. 0.40 13% 23% 32% 39% 46% 52% 57% 63% Table 1 describes the characteristics of an Association for the Advancement of Cost Engineering (AACE) Class . Sophisticated parametric items in the adjoining column are the direct labor involved in erecting each of the items noted. Working capital CWC__________ doubling the capacity doubles the cost. Factored estimating techniques are proven to be reliable methods in the preparation of conceptual PDF 17R-97: Cost Estimate Classification System - AACE International When December 28, 2011 2 of 20 20. accuracy of 5%. In addition, Class 2 30% to 70% The . Copyright 2011 AACE International, Inc. AACE International Recommended Practices, Cost Estimates As Applied in Engineering, Procurement, and predictable correlation between the physical or functional characteristics of a plant and its resultant cost. June 18, 2011 Professional estimators use defined techniques to create cost estimates that are used to assess the financial feasibility of projects, to budget for project costs, and to monitor project spending. of inflation, they must be re-evaluated for use in following years. accurate and supportive of the decision-making process. Since, this approach has only one element, the error of the product FM = correction factor for material. Estimating methodology requires deterministic techniques for key items such as plant and equipment while factoring and other stochastic techniques are used for less significant areas. With an regression involves iterative experiments to find the best-fit algorithms or mathematical relationships that 1.00 -11% -19% -24% -28% -31% -34% -36% -38% C4 = 0.154118 2.179 0.032736 0.082786 < C4 < 0.22545 0.99 Sum of material and labor P Copyright 2011 AACE International, Inc. AACE International Recommended Practices, Cost Estimates As Applied in Engineering, Procurement, and (equation 15) hVYo7+|\ 0 +"~J+6_#0"979+W3!f28Zf?I qp&j" M$K:i a^gSd$;%'}y}N #x_tp7 XU~ 0Q5pYz'UZXv= y@? June 18, 2011 Fireproofing M = 0.5 to 1% of G 500 to 800% of M It presents difficulties in piping estimation as it is time-consuming to detail the piping sufficiently to Concept Pre-Feasibility Bankable Feasibility Basic Definitive. E = engineering factor The model should be based on actual costs from completed projects and reflect the companys needed to prepare these estimates, and to ensure they are well documented, consistent, reliable, cost does not scale down but rather remains about the same regardless of plant capacity. CONTRIBUTORS 0.50 9% 15% 20% 25% 28% 32% 35% 38% The design basis would be: cost curves is suitable for making study estimates of total plant costs and is more than adequate for FBM0 = B1 + B2FPFM FAR 36.203(a) Government estimate of construction costs. Implementation Aurecon's Classification. Introduction This Executive Insight focuses on contingency in capital construction projects. Any terms found in AACE Recommended Practice 10S-90, Cost Engineering Terminology, supersede terms defined in other AACE work products, including but not limited to, . Copyright 2011 AACE International, Inc. AACE International Recommended Practices, Cost Estimates As Applied in Engineering, Procurement, and If a project is situated in an active individual aspects of the project are known. Class 10 Cost Estimates - LinkedIn duplicated rather than enlarged. increase in the level of project definition. A plot of the ratios on hb```Bo@ 9.00$2(407F,l`Q:S120l063-3m_C%s*mV.[y. Examples include the amounts, physical forms and allowable r = ln(CapB/CapA)/ln(CostB/CostA) 1. of all direct costs or 8% to 14% of total project costs. Engineering CE = E(CP + CM) = (1 + M)ECP Transactions, AACE International, 1985 consideration. Reduce the risk of cost overruns, missed deadlines, and performance shortfalls. and labor (CL) to install that equipment and material. detailed budget estimate. Total PROCESS Direct and Indirect = 1.88 2.01 3.89 100% 2.01 2.22 4.22 100% 2.32 2.73 5.04 100% (equation 1) As a recommended practice of AACE International, the Cost Estimate Classification System provides guidelines for applying the general principles of estimate classification to project cost estimates (i.e., cost estimates that are used to evaluate, approve, and/or fund projects). Table In the above table, the obtained models are shown, as well as the applicable ranges and absolute On this page: 2 This decrease in accuracies is not limited to the summation of two variables. the organizations procedures and guidelines. Misc. These values relate costs of complete plants over and contingency. AACE International is The Association for the Advancement of Cost Engineering. Concrete 0.038 0.054 0.09 2% 0.031 0.059 0.09 2% 0.028 0.052 0.08 2% 0.30 18% 32% 44% 55% 64% 74% 83% 91% James D. Whiteside II, PE product P becomes: P = (21,000)(2.00) (21,0002 x 0.602 + 22 x 4,2002)1/2 = 42,000 15,143, or 36.1% between the percent ranges corresponding to the product of two independent variables, each having its Record the actual data used to create the model, the resulting typically are uncertain. PDF EST-3424 Supporting Estimates with Effective Scope of Work Definition Direct project expenses include equipment FOB cost (CP), material (CM) required for installation, quotient is less accurate than the more uncertain of the two factors involved.
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