Economic modelling of a ferrochrome furnace

Abstract

All industrial processes are economically driven, resulting in the ever increasing need for process optimization in order to stay competitive and profitable. Numerous models has been published depicting the optimization of the raw material usage in an arc furnace, as well as the thermal and electrical efficiency; however, to obtain a holistic view of the cost-effectiveness of the process one needs to expand the model to include the cost of all the operational variables. This project therefore aimed to not only include the raw material feeds and power consumption as input variables, but also the labour, maintenance, and environmental costs to generate an all-inclusive financial balance. In the end, the model was able to mathematically optimize the ferrochrome (FeCr) production process through evaluating the effect of a specified combination of input parameters. It could therefore be used as a tool to aid in managerial decisionmaking; to appraise and correspondingly adjust certain operational variables in order to achieve a maximum return on investment. This paper fully describes the reasoning behind the choice of the essential model components, the assumptions made during the models development, the calculation approach, as well as the advantages, limitations, possible applications, and areas for expansion of the final model. Through running simulations with plant data, it was found that the accuracy of final model remained fairly constant when applied to stable furnace conditions, but was met with a number of limitations when applied to more complex situations. These limitations could, however, be overcome through further development and expansion of the existing model to include a larger number of process variables.