Economic Analysis
In order to estimate the total investment required, the price of all equipment used must be estimated precisely. Since this project is producing small amount of Biodiesel with 100 Litres per Year, the prices of equipment involved are based on the existing price in the market as well as price for similar equipment or similar processes. The Inside Battery Limit as well as the Outside Battery Limit were involved in the estimation resulting in in a total fixed capital cost of 31.4 RM and total investment Required of 46.9 RM
The operating cost is mainly consist of the variable cost and the fixed cost. For this project, no fixed cost is used since it is very small scale that don't require much maintenance or any operating labour cost. The cost of the raw material WCO can be assumed to be free since it is waste. However, in this project, it is estimated to be purchased from a special Waste Cooking Oil supplier to make this project more realistic. Since this project is at small scale, no electricity was required.
The cash flow of the project was studied for a period of 15 years at a production rate of 100 Litres per Year produced of Biodiesel. Selling the biodiesel with 1.4 RM per Litre, an annual net profit of 44 RM was obtained with a payback time of 2 years of production.
