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Mapua Institute of Technology

School of Chemical Engineering, Chemistry, and Biotechnology

BIOGAS DIGESTER
FOR HI-GRADE FEEDS

A Design Proposal Submitted in Partial Fulfillment of the


Requirements for the Degree Science in
Chemical Engineering

Chang, Miriam Abigail G.


Calipes, Danica Mari D.G.
Mejia, Anne Margaret G.
Talampas, Alvin A.

May 2006

APPROVAL SHEET
This is to certify that we have supervised the preparation of and read the design report prepared
by Miriam Abigail G. Chang, Danica Mari Calipes, Anne Margaret G. Mejia, and Alvin A.
Talampas entitled Biogas Digester for Hi-Grade Feeds and that the said report has been
submitted for final examination by the Oral Examination Committee.

__________________________
Winston B. Flora
Course Adviser

________________________
Teresita P. Madulid
Adviser

As member of the Oral Examination Committee, I certify that I have examined this design
report, presented before the committee on May 20, 2006, and hereby recommended that it be
accepted as fulfillment of the design report requirement for the degree in Program of Bachelor
of Science in Chemical Engineering.

________________________
Winston B. Flora
Panel Member

This design report is hereby approved and accepted by the School of Chemical Engineering,
Chemistry and Biotechnology as fulfillment of design report requirement for the degree in
program of Bachelor Science in Chemical Engineering.

________________________________
Prof. Luz L. Lozano
Dean, School of Chemical Engineering,
Chemistry and Biotechnology

LETTER OF TRANSMITTAL

PROF. LUZ L. LOZANO


Dean
School of Chemical Engineering, Chemistry and Biotechnology
Mapua Institute of Technology
Intramuros, Manila

Dear Prof. Lozano:


In accordance with your instructions, Our group has written the following design paper on the
topic Biogas Digester for Hi-Grade Feeds.
This paper aims to present a study on the production of biogas for Hi-Grade Feeds in Bocaue
Bulacan together with the design of the digester. This report gives you a complete background of
the project. Also included are executive summary, market study, technical study, environmental
study, financial study and our conclusion and recommendation.
Attached here with our final report is a compact disc which contains word file used in this design
project.

We hope that this report will satisfy the requirements for Plant Design (DESIGN313).
Respectfully yours,

________________________
Chang, Miriam Abigail
2002119509
B.S. CCE

________________________
Calipes, Danica Mari
2001132920
B.S. CHE

________________________
Mejia, Anne Margaret
2002128418
B.S. CHE

________________________
Talampas, Alvin
2002121809
B.S. CCE

ACKNOWLEDGEMENT

We would like to extend our gratitude and recognition to the following who help us
finished this study, Biogas Reactor for Hi-grade Farm. For without them, this study may not be
possible.

Our families, for being our strength at times when we want to give up and for being
our inspirations to strive for the best.

Ms. Theresita P. Madulid for giving us enough information regarding her Hi-grade
farm.

Mr. Ric Perez for allowing us to visit his biogas digester.

Mr. Ruben Mercado for his warm accommodation in his farm in Bulacan

Engr. Felecitos Aguilar and Engr. Narciso Macaranas for joining in our farm visit

Engr. Alvin Caparanga and Engr. Edwin Obra for supervising us in our equipment
design.

Engr. Winston Flora for entertaining our questions during consultations and for
supervising us in our project.

And most especially to the Lord Almighty for giving us the guidance and wisdom
To God be the glory!!

To all of you, we give our sincerest gratitude and love.


Abi, Nica, Mha-anne & Alvin

ii

TABLE OF CONTENTS
LETTER OF TRANSMITTALi
ACKNOWLEDGEMENT ............................................................................................................... i
INTRODUCTION .......................................................................................................................... 1
EXECUTIVE SUMMARY ............................................................................................................ 5
Objectives of the Project............................................................................................................. 5
SWOT Analysis .......................................................................................................................... 5
MARKET STUDY ......................................................................................................................... 6
Production Description ............................................................................................................... 6
Use of Product............................................................................................................................. 7
User of the Product ..................................................................................................................... 7
Historical and Projected Demand ............................................................................................... 8
Historical and Projected Supply.................................................................................................. 9
TECHNICAL STUDY ................................................................................................................. 10
Description of Raw Materials ................................................................................................... 10
Material Balance Major Assumptions ...................................................................................... 11
Overall Material Balance .......................................................................................................... 12
Detailed Material Balance (10-day process)............................................................................. 13
Process Flowchart ..................................................................................................................... 14
Equipment Specification........................................................................................................... 15
ENVIRONMENTAL STUDY ..................................................................................................... 17
Material Safety Data Sheet ....................................................................................................... 23
FINANCIAL STUDY................................................................................................................... 28
CONCLUSION AND RECOMMENDATION............................................................................ 50
APPENDIX................................................................................................................................... 52

List of Tables
Table 6.1 GANTT Chart .............................................................................................................. 28
Table 6.2 Pre-operating expenses. ................................................................................................ 29
Table 6.3 Pre-operating salaries with benefits.............................................................................. 29
Table 6.4 Administrative and Marketing expenses....................................................................... 30
Table 6.4 Construction Cost ......................................................................................................... 33
Table 6.6 Salary and wages projection ........................................................................................ 34
Table 6.7 Depreciation1 of all equipments................................................................................... 35
Table 6.8 Repair and maintenance of all equipments .................................................................. 36
Table 6.10 Projected revenue....................................................................................................... 38
Table 6.11 Inventory of finished goods ........................................................................................ 39
Table 6.12 Project cost................................................................................................................. 40
Table 6.13 Cost of production ...................................................................................................... 42
Table 6.14 Income statement ....................................................................................................... 43
Table 6.15 Balance sheet ............................................................................................................. 45
Table 6.16 Cash flow. .................................................................................................................. 46
Table 6.17 Breakeven analysis .................................................................................................... 47
Table 6.18 Rate of investment ..................................................................................................... 48
Table 6.19 Payback period............................................................................................................ 49
List of Figures

Figure 3.1 Historical Demand......................................................................................................... 8


Figure 3.2 Projected Demand ......................................................................................................... 8
Figure 3.3 Historical Supply........................................................................................................... 9
Figure 3.4 Projected Supply............................................................................................................ 9
Figure 4.1 Overall Material Balance............................................................................................. 12
Figure 4.2 Detailed Material Balance ........................................................................................... 13
Figure 4.3 Process Flowchart........................................................................................................ 14
Figure 4.4 Equipment Specification ............................................................................................. 15

INTRODUCTION

The use of biogas as a source of fuel is a practice only recently introduced in this century.
The process of bacterial decomposition has occurred in nature since life began plants and
animals die and are recycled to sustain life on the planet. In the presence of oxygen, organic
material "composts" (undergoes aerobic decomposition). When decomposition occurs in the
absence of oxygen (anaerobic conditions), biogas is produced, and the liquid remainder is rich in
nitrogen and other nutrients.

The Philippines has substantial biogas resources. Biogas accounts for a significant
proportion of renewable energy generation (99% of new and renewable energy demand
excluding geothermal and hydro power for 1996), mainly from wood fuel and charcoal. Large
amounts of agricultural residues and municipal solid waste are also produced, offering promising
resources for heat and power generation.1

With the present energy and pollution problem in the Philippines, conversion of livestock
wastes as source of energy and fertilizer, offers a great advantage for the livestock industry. A
program that suits the need of backyard livestock raisers to abate the worsening problem of
environmental pollution is now given high priority.

Biogas is one of the renewable sources of energy receiving popularity in rural areas and
has successfully met the cooking energy needs of families. The optimum utilization depends

www. emb.gov.ph

upon the successful physical installations, which in turn depend upon plant design and its
selection.2
Biogas is a zero waste technology. The products of biogas plants, like biogas and
digested slurry can be utilized economically for cooking and as manure for agriculture and
horticulture. Biogas is a non-poisonous and non-toxic gas which when mixed with air burns with
blue flame, without soot or any offensive smell. The slurry is rich in nitrogen, phosphorous,
potash and humus material. It has good applications in agriculture and horticulture.
Use of biogas technology improves the standard of living and can directly contribute to
economic and social development of a country.
However, there are hurdles to implementation of these systems, including high capital
costs, availability of economic and environmentally acceptable methods of gas processing, and
economic means for biogas utilization. Because of these limitations, agricultural biogas
production has remained a virtually untapped resource in the Philippines.
Considering the opportunities and problems on the biogas production the researchers
attempts to design a biogas digester for hog manure which is more efficient, economical and
environmentally accepted.
The complete design of the digester constructs a digester in larger scale for preheating of
water at Hi-grade feeds at Bocaue, Bulacan. In addition, it can minimize the amount of municipal
waste that can help in environmental preservation by utilizing that manure in more useful way.

www.encyclopedia.com

Digesters are not a new idea and have been around for a long time. Increasing
environmental pressures on waste disposal has increased the use of digestion as a process for
reducing waste volumes and generating useful byproducts. The purpose of all these digesters is
to produce combustible biogas which can be burned to provide energy for a whole range of uses.
In the United States an outreach program called AgSTAR designed to reduce methane
emissions from livestock waste management operations by promoting the use of biogas recovery
systems. A biogas recovery system is an anaerobic digester with biogas capture and combustion
to produce electricity, heat or hot water. Biogas recovery systems are effective at confined
livestock facilities that handle manure as liquids and slurries, typically swine and dairy farms.
Anaerobic digester technologies provide enhanced environmental and financial performance
when compared to traditional waste management systems such as manure storages and lagoons.
Anaerobic digesters are particularly effective in reducing methane emissions but also provide
other air and water pollution control opportunities. The AgSTAR Program has been very
successful in encouraging the development and adoption of anaerobic digestion technology.
Since the establishment of the program in 1994, the number of operational digester systems has
doubled. This has produced significant environmental and energy benefits, including methane
emission reductions of approximately 124,000 metric tons of carbon equivalents and annual
energy generation of about 30 million kWh.3
Our group was able to visit and see the digester of Mr. Ric Perez in Bulacan. The Perez
household has the simplest structure and model of the digester and this has been working for
almost 14 years. They use this digester to produce biogas using the pig and chicken manure as
3

www.agstar.com

their raw materials. The biogas produce was use as a replacement for LPG as a cooking gas for
their household. The equipment has also a safety measure. The cover of the digester is allowed to
rise but with a limit. When the limit is achieved, bubbles in water are visible for the pressure is
released through the water.
Also, Mr. Ruben Mercado uses biogas as a source of energy. The biogases produced by
the pigs are used to preheat the water for the boiler. In this case, he was able to minimize his
usage of banker oil for the water entering the boiler is already at elevated temperature. He is
using a lagoon which has been operating for almost five years. The design also includes safety
measures like u- tube.

EXECUTIVE SUMMARY
Objectives of the Project
This study aims to design a Biogas reactor for Hi-grade farm that will produce biogas for
pre-heating water for the boiler of the mill. This project expects to achieve the following
objectives:

To produce an efficient digester in which high profit will be achieved.

To minimize the use of bunker fuel in the boiler

To maximize the use hog manure to a useful product which is the biogas

SWOT Analysis
Strength

Biogas is a zero waste technology

Weakness

Not well-verse in the field of business- some financial elements may not be
considered which can affect in the financial reports

Opportunities

High demand for Biogas

Open to new trend and market

New development/ techniques and technology

Reduction of waste

Peso depreciation decrease of peso value will result to increase in savings due to
bunker fuel

Threat

Peso appreciation the increase of peso is a great effect in our companys profit

MARKET STUDY
Production Description
There are varieties of gas useful as fuel. The three most commonly used worldwide are
Liquefied Petroleum Gas (LPG, propane, butane), Natural gas, and Biogas4. LPG is a mixture of
volatile fractions from petroleum refining; principally propane, butane, propylene and butylene.
Natural Gas is a fossil fuel that was created eons ago by the anaerobic decomposition of organic
materials. It is often found in association with oil and coal.

Biogas is produced when bacteria breakdown organic material in the absence of oxygen,
in a process known as anaerobic digestion. The same type of anaerobic bacteria that produced
natural gas also produced methane today. Anaerobic bacteria are some of the oldest forms of life
on earth.
Biogas is generally between 60% methane, with the remainder consisting of 39% carbon
dioxide, hydrogen sulfide and other trace gases5. Biogas burns well and can be used to provide
energy in the form of heat or electricity. Biogas can therefore not only off-set fossil fuel imports,
it can result in no increases, and even reductions in greenhouse gases. Methane is 30-times more
reactive than C02 in causing global warming6.

Twidell, John et. al. Renewable Energy Resources, (an imprint of) Chapman & Hall, London 1986

Fulhage, Charles et. al. Generating Methane Gas from Manure, Department of Agricultural Engineering, College of Agriculture

Woods, Sandra, et. al. Methane Fermentation of Biomass, Seattle, Washington September 1980

Use of Product

It is used as a substitute for LPG in preheating the water upon feeding to the boiler. In
this way we will be able to lessen the use of bunker oil because the feed water is higher than
25C so heat required to convert water to steam will be lower.

User of the Product

It will be use by the Hi-grade feed located at Bocaue, Bulacan. The biogas will be use to
preheat the water that is required to the boiler.

Historical and Projected Demand


Historical Demand
500
400
300
200
100
0
1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006

Figure 3.1 Historical Demand

Projected Demand
2000

20
06
20
07
20
08
20
09
20
10
20
11
20
12
20
13
20
14
20
15
20
16

1500
1000
500
0

Figure 3.2 Projected Demand

The Historical and Projected Demand is based from the information given by Ms.
Teresita Madulid (Hi-Grade feeds Company owner) according to the demand in terms of amount
of water which is being fed to the boiler by 15% annually. The increase in production of feeds is
directly proportional to the amount of water used to the boiler.

Historical and Projected Supply

Historical Supply
15000
10000
5000

19
97
19
98
19
99
20
00
20
01
20
02
20
03
20
04
20
05
20
06

19
96

Figure 3.3 Historical Supply


Projected Supply
60000
50000
40000
30000
20000
10000

20
16

20
15

20
14

20
13

20
12

20
11

20
10

20
09

20
08

20
07

20
06

Figure 3.4 Projected Supply


The Historical and Projected Supply is based from the information given by Ms. Teresita
Madulid (Hi-Grade farm Company owner) according to the supply which is for pigs increased by
10% annually.

TECHNICAL STUDY
Description of Raw Materials
There is a growing concern about the widespread problem brought about by the improper
disposal of animal manure in many tributaries in the Philippines. Recent outbreak of diseases in
some municipalities had been attributed to contaminated drinking water by the seepage of animal
manure in the drinking water supply. Recreational activities like swimming, fishing and camping
can be ruined. The long term consequence is the damage to aesthetic and intangible attributes of
the streams and destruction of the economic value of clean natural waters.
Hog production in the country has increased drastically in recent years due to rapid
increase in population and therefore meat requirements and the waste generated becomes
unmanageable. The Philippines produces 7.589 million metric tons of hog manure alone in
19997.
The raw material for biogas production must contain organically bound carbon and the
element nitrogen which is needed by the bacteria responsible for biogas production.
Animal manure contains a portion of volatile (organic) solids which are fats,
carbohydrates, proteins, and other nutrients that are available as food and energy for the growth
and reproduction of anaerobic bacteria. Pig manure is the commonly used principal raw material,
since more biogas can be generated from pig manures composition. Biogas generation from
these wastes has been proven to be technically feasible, economically viable and socially
desirable and since our study is mainly within Hi-grade Farm, pig manure is readily available.

Biomass Atlas of the Philippines, Philippine Biomass Energy Laboratory

10

Material Balance Major Assumptions


The following assumptions are used in the production of Biogas:

Biogas obeys ideal gas behavior

Input slurry (diluted manure) in one day will be completely digested after 10 days
producing total of 235.73 m3 gas based from the material balance

The gas produced per day is uniform in volume meaning 23.573 m3 gas/day

These are assumed to simplify design computations.

11

Overall Material Balance


INPUT
Basis: 10 days complete
digestion

H2O = 58,860 kg

OVERALL MATERIAL BALANCE

FINAL OUTPUT

INPUT

BG = 235.73 m3
Sludge = 94,254.48 kg

Solid = 9810 kg
Liquid = 29,430 kg

Figure 4.1 Overall Material Balance

12

Detailed Material Balance (10-day process)

INPUT
H2O = 58,860 kg

INPUT
Solid = 9810 kg
Liquid = 29,430 kg

DILUTION
TANK

OUTPUT = 98100 kg
Diluted Manure

DIGESTER

OUTPUT = 94,254.48 Kg
Sludge

INPUT = 98,100 kg
Diluted Manure
OUTPUT = 235.73
m3
Biogas

Figure 4.2 Detailed Material Balance

13

Process Flowchart
Water

Biogas

Manure

DILUTION
TANK

Diluted
Manure

DIGESTER
Sludge

Figure 4.3 Process Flowchart

14

Equipment Specification
P-3

P-2

V-2

V-2
P-4
P-1

Figure 4.4
Equipment
Specification

15

Pipeline List

Valve and Fittings List

Displayed Text

Material

Diameter

P-1
P-2
P-3
P-4

Polyethylene Pipe
Polyethylene Pipe
Natural Rubber
Polyethylene Pipe

50.95 mm
20 mm
20 mm
50.95 mm

Length
0.40
1.40
0.40
1.40

m
m
m
m

Displayed Text
V-1
V-2
5 Elbows

Line Size Valve/Fitting Class


20 mm
20 mm
20 mm

Gate Valve
Gate Valve
90 degrees

16

ENVIRONMENTAL STUDY
Biogas Production for Hi-Grade Feeds

Consistent with the implementation of Presidential Decree 1586 (Philippine EIS


System Law) with an end view of attaining and maintaining an orderly balance between
socio-economic growth and environmental protection.
The goal is to minimize waste, to have a more economical source of energy and fuel
and to provide a better design for the recovery and utilization of gas in for water pre-heating
in Hi-grade feeds.

I. Project Description
A. Basic Information

Upon proper approval, this project, the biogas production will be implemented on
July 2006 and it will be located in Bocaue, Bulacan. Generally, the people living within the
municipalities of Bulaon, Del Rosario, Dolores, Malino, Malpitic, Marmatad, San Nicolas,
Santo Nino, Quebiawan, and Telabastagan are the stakeholders or the persons who may be
significantly affected by the project. This project will be financed by the owners of the HiGrade Feeds.

17

B. Project Rationale
While maximizing biogas output from available waste materials is very significant,
maximizing the use and application of the gas deserve equal importance.

For direct heating applications, biogas is used for cooking and brooding lamps
in heating chicks and piglets in livestock farms, for torch using fire
disinfectant in piggery pens to replace chemical disinfectant

For typical family use, biogas can be used for ironing, and as a fuel for gas
mantle lamps, absorption-type refrigerator, in addition to cooking

As fuel for internal combustion engines, biogas can be used as substitute for
diesel or gasoline. It has a higher octane rating than both conventional
petroleum fuels

Whereas the sludge component can be used in a given ways:

As fertilizer for plants and agricultural crops,

As feed for raising fish, for vermiculture (earthworms), and for pigs

As dipping media for seed soaking

As soil conditioner

Advantages

Sludge is odorless and BOD effluent is reduced by 86%

Organic wastes are reduced by 50% and relatively safe for disposal

Effectiveness of the system all year round without the need of artificial
heating or expensive insulation of the digesters because of the
Philippine climate

Construction of the plant is simple and the system is easy to operate

18

Reduce dependence on foreign oil and fossil fuels

It can help boost the economy

Reluctance to handle animal or human excreta and to use biogas from

Disadvantages

these sources for pre-heating

Cost of digesters, especially for most people in rural areas

This document describes the production of biogas by transporting piggery waste of


the Hi-grade Farm to Hi-grade feeds and thus, we aim to economically use this resource.
Also, this project would help in improving our lives by manure a commercial value.
D. Description of Project Phases
1. Pre Operational / Construction phase
The estimated total construction area of the digester is 25 m2 land in
Bocaue, Bulacan. It will be located near the boiler of the feeds. There will be trial
run before the start of operation.
2. Operational phase
The digester operation will be everyday and is intended to promote biogas
technology in rural areas.
II. Baseline Information
CLIMATE
November to April is generally dry while wet form May to October. The northeast
monsoon prevails over the sea from October to January bringing in moderated and light
rains, the east trade winds predominate from February to April but the step of Sierra Madre
19

Mountains interposes the free movement of air resulting to a dry with scanty rain during the
period. While from May to September, the southeast monsoon prevails strong winds and
abundant rainfall and generally associated with storm and typhoon
GEOGRAPHY
The western part of the province is generally flat and is drained by the Angat and
Pampanga Rivers. Part of the western boundaries touches the extensive Candaba Swamps
which mark the pronounced depression in range.
POWER SOURCE
Bocaue is fully dependent to MERALCO for its electrical power needs. Survey
results showed that 90% of the total households in the municipality are already serviced by
the said company.
III Environmental Impact
Life Cycle Assessment

Figure 3: Overall Material Balance of the Proposed Process

H2O = 58,860 kg
Solid = 9,810 kg
Liquid = 29,430 kg

BG = 235.73 m3
Sludge = 94,254.48 kg

20

1. Air Impacts
a.

CH4
Methane (CH4) is a greenhouse gas that remains in the atmosphere for approximately

9-15 years. Methane is over 20 times more effective in trapping heat in the atmosphere
than carbon dioxide (CO2) over a 100-year period and is emitted from a variety of
natural and human-influenced sources. Human-influenced sources include landfills,
natural gas and petroleum systems, agricultural activities, coal mining, stationary and
mobile combustion, wastewater treatment, and certain industrial process.8
b.

H2S
Hydrogen sulfide is a colorless gas with an offensive stench and is said to smell like

rotten eggs. The gas can be detected at a level of 2 parts per billion.. Just a few breaths
of air containing high levels of hydrogen sulfide gas can cause death. Lower, longerterm exposure can cause eye irritation, headache, and fatigue.
c.

CO2
Carbon dioxide is a colorless, odorless, faintly acidic-tasting, and non-flammable gas

at room temperature.
2. Water Impacts
a. NH4
Ammonia is a gas that occurs naturally in the environment and is also manmade.
From the biogas production, ammonia will come from the sludge withdrawn in the

Grolier Multimedia Encyclopedia. Grolier Interactive, Inc.1998

21

digester. Ammonia is irritating to the skin, eyes, nose, throat, and lungs. Exposure to
high concentrations can cause serious burns.9
IV. Impact Mitigations or Enhancement Plan
1. Air Impacts
a. CH4
Methane (CH4) in this process is directly used after production of biogas. Pipes from
digester to the burner will be periodically checked and make sure that there is no leakage
2.

Water Impacts
These compounds can be used as liquid fertilizer for the field.

VI. Reference:
Books:

Grolier Multimedia Encyclopedia. Grolier Interactive, Inc.1998

Webster Family Encyclopedia. 1996

URLs:

http://asiatravel.com/manila/pampangamap.html

www. askjeeves.com/glass/manufacturing.html

www. emb.gov.ph

www.encyclopedia.com

Grolier Multimedia Encyclopedia. Grolier Interactive, Inc.1998

22

Material Safety Data Sheet10


Methane(CH4)

Chemical Product and Company Identification

Material Name:

Methane

Chemical Formula:

CH4

Synonyms:

Methyl hydride, natural gas, marsh gas, fire damp.

Composition/Information on Ingredients

CAS Registry

Molar (volume)

Number

concentration

74-82-8

100%

Component

Exposure Guidelines

Simple Asphyxiant
Methane

(ACGIH)

Hazards Identification
Emergency Overview
Methane is a colorless and odorless gas. It is not toxic; the immediate health hazard is
that it may cause thermal burns. It is flammable and may form mixtures with air that are
flammable or explosive. Methane is violently reactive with oxidizers, halogens, and some
10

Webster Family Encyclopedia. 1996

23

halogen compounds. The concentrations at which flammable or explosive mixtures form are
much lower than the concentration at which asphyxiation risk is significant.
Potential Health Effects 11
Routes of Exposure: Methane is not toxic by any route. Asphyxia may result if the oxygen
concentration is reduced to below 18% by displacement.
Lengths of Exposure: None of the available data indicate toxicity for exposures of any
duration.
Severity of Effect: No effect identified.
Target Organs: None identified.
Type of Effect: No effect identified.
Signs and Symptoms of Exposure: None identified.
Medical Conditions that may be Aggravated by Exposure: None identified.
Reported Carcinogenic and Reproductive Effects: None known to Voltaix, Inc.
First Aid Measures12
Asphyxiation
This is the primary health risk.

Remove the affected person from the gas source or contaminated area. Note: Personal
Protective Equipment (PPE), including positive pressure, self contained breathing
apparatus, may be required to assure the safety of the rescuer. The concentration
required for asphyxiation is above the upper flammable limit. A boundary region, in

11

Webster Family Encyclopedia. 1996

12

Grolier Multimedia Encyclopedia. Grolier Interactive, Inc.1998

24

the flammable range, may exist between contaminated and uncontaminated areas.
Take appropriate precaution against ignition of the atmosphere in this region.

If the affected person is not breathing spontaneously, administer rescue breathing.

If the affected person does not have a pulse, administer CPR.

If medical oxygen and appropriately trained personnel are available, administer 100%
oxygen to the affected person.

Summon an emergency ambulance. If an ambulance is not available, contact a


physician, hospital, or poison control center for instruction.

Keep the affected person warm, comfortable, and at rest while awaiting professional
medical care. Monitor the breathing and pulse continuously. Administer rescue
breathing or CPR if necessary.

Skin Contact
No detrimental effect of skin contact has been reported. Treat thermal burns by
assuring that affected area is cool by flushing with cool water, then apply dry sterile
dressings. If the patient is burned on the face, neck, head, or chest, assume that the airway
may also have been burned and obtain professional medical assistance immediately.
Eye Contact
No detrimental effect of eye contact has been reported.
Ingestion
Ingestion is not an observed route of exposure to gaseous hazardous materials.
Note to Physicians:
The combustion products of methane and air are water and carbon dioxide. Under
some conditions, carbon monoxide may also be produced.

25

Accidental Release Measures


Containment
As these materials are gases at atmospheric conditions, the only means of
containment is the enclosure of the space into which the materials are released.
Evacuation
If the release is not contained in an appropriate device or system, all personnel not
appropriately protected must evacuate the contaminated spaces.
Handling and Storage
Handling
Handle this material only in sealed, purged systems. The design of handling systems
for hazardous materials is beyond the scope of this MSDS, and should be performed by a
competent, experienced professional. Consider the use of doubly-contained piping;
diaphragm or bellows sealed, soft seat valves; backflow prevention devices; flash arrestors;
and flow monitoring or limiting devices.
Storage
Gas is stored in the cover of the digesterin which its design is carefully studied.
Stability and Reactivity
Chemical Stability: Methane is stable.
Conditions to Avoid: Sources of ignition, exposure to air.
Incompatibility with Other Materials: Oxidizers, halogens and some halogen compounds.
Hazardous Decomposition, Reaction and Oxidation (other than burning) Products:
None.

26

Toxicological Information
Acute Data (by route): None, methane is a simple asphyxiant.
Chronic and Subchronic Data: No information on its carcinogenicity or other effects is
included.

27

FINANCIAL STUDY

GANTT Chart
No.

Activities
Feb

1
2
3
4
5
6
7
8
9

March

2006
April-June

July

August

July

2014
May

June

July

Completion of Study
Proposal and Approval
Purchasing of Materials
Recruitment and Hiring of Laborer (Equipment
Construction)
Land Development
Equipment Construction
Recruitment and Hiring of Personnel
Trial Run
Start of Operation

Table 6.1 GANTT Chart 1

A Gantt chart is a popular type of bar chart that aims to show the timing of tasks or activities as they occur over time. It can show
when the project terminal elements start and finish.

28

PRE - OPERATING EXPENSES


Trial-run cost (raw materials,salary & wages)
Pre-operating salary and wage (design team)

May
22742
180000

Total
Amortization

202742
40548

Table 6.2 Pre-operating expenses.


Trial run cost is based on 10 days period

Pre-operating salaries with benefits


Project design team (Students)
Project consultant
Total Employees
Total Pre-optg & fringe

Qty
Days
4
60
1
10
5
180000

Salary/day
400
6000

Benefits
100

Total Compensation
120000
60000

Table 6.3 Pre-operating salaries with benefits


The project consultant will approve the design proposed by the students
1

Amortization is the distribution of a single lump-sum cash flow into many smaller cash flow installments, as determined by an amortization schedule.
Amortization is chiefly used in loan repayments (a common example being a mortgage) and in sinking funds. Payments are divided into equal amounts for the
duration of the loan, making it the simplest repayment model.

29

Administrative and Marketing


A&M
office supplies
Amortization pre-op
TOTAL

2006 2007
2008
1100 1111 1122.11
40548 40548 40548
41648 41659 41670

2009
1133.33
40548
41682

2010
1144.664
40548
41693

2011
1156.11

2012
1167.672

2013
1179.35

2014
1191.14

2015
1203.054

1156

1168

1179

1191

1203

Table 6.4 Administrative and Marketing expenses.


Office supplies increases 1% per annum.

30

CONSTRUCTION COST
MATERIALS
Gravel

Quantity
4.56 m3

Amount/unit
P969

Cost
4419

Portland cement
Plywood (formers)

571 bags
20

P165/bag
P320/pc

94215
6400

40 kilo/bag
(1/4 x 4 x 8 ft)

3 pcs

P3,500

10500

1 plate (4x8 ft)

150 pcs

P300/pc

45000

200 L

Gas Burner

4 pc

P3,000

12000

Sand

11.4125
ton
51 pcs

P350/ton

3994

P350/pc

17850

Others:
Stainless Steel
(Cover)
Drums (boiling
water &
transportation
manure)

Reinforcement bar
Total Amount

Specification

25-70kg/m2
194378

31

PIPES
Quantity
1

Amount/unit
P210/10ft

Cost
210

PE Pipe

P180/10ft

540

Valves

300

Elbows

P100/pc (2
diameter)
P150/pc (4
diameter)
P25/pc

Flexible Hose

Total Amount
Grand Amount (Materials and Piping)

125

Specification
2 inches
diameter
2 inches
diamter
2 and 4 inches
diameter

90 degrees 2
inches diameter

1175
195553

Labor Cost

Supervisor
Laborer
cover

Qty
1
10

Days
22
22

Salary/day
406
325

Benefits
102
81

Total
Compensation
11172
89375
8000

32

Equipment Cost
Digester
TOTAL

Volume (m3)
173

Area (m2)
25

Length (m)
9

Witdth (m)
9

Height (m)
2

Cost(2006)
304100
304100

Cost(2014)
397319
397319

* digester's cost in 2014 make use of CPI (Consumer Price Index), Source NSO (National Statistics Office)

Vehicle rent (truck)


2006
2007
2008
2009
2010
2011
2012
2013
2014
2015

Cost
360000
396000
435600
479160
527076
579784
637762
701538
771692
848861

*Vehicle rent is 30000/month for the 1st year and 10% incerease
every year

Table 6.4 Construction Cost

33

Salary and Wages


2006
Personnel

Laborer
Driver
Supervisor
assumption

Laborer
Driver
Supervisor
TOTAL

Rate/day

Benefits

Total/day

No. of
Days

No. of
Personnel

Salary/yr

325
325
406

81
81
102

406
406
508

22
22
22

2
2
1

214500
214500
134063

2007
220935
220935
138084
579954

2008
227563
227563
142227
597353

2009
234390
234390
146494
615274

2010
241422
241422
150889
633732

2011
248664
248664
155415
652744

3% increases/yr

2006
214500
214500
134063
563063

2012
256124
256124
160078
672326

2013
263808
263808
164880
692496

2014
407583
543444
169826
1120854

2015
629716
1119495
174921
1924133

*25% BENEFITS INCLUDES 13TH MONTH BONUS,SSS & VACATION LEAVE

Table 6.6 Salary and wages projection

34

DEPRECIATION
ASSET(2006)
Biogas
Digester

Assets (2014)
Digester

Qty

COST

ESTIMATED LIFE

DEPRECIATION/YR

304100

50

6082

397319

ESTIMATED LIFE
42

9460

Table 6.7 Depreciation1 of all equipments

Depreciation is an accounting and finance term for the method of attributing the cost of an asset across the useful life of the asset. Depreciation is an example
of applying the matching principle as per generally accepted accounting principles.

35

Repair and Maintenance


2006
2007
2008
2009
2010
2011
2012
2013
2014
2015

digester
3041
15205
15965
16764
17602
18482
19406
20376
21395
22465

digester(2014)

3973
7946

truck
3600
7200
7560
7938
8335
8752
9189
9649
10131
10638

truck(2014)

7717
15434

TOTAL
6641
22405
23525
24702
25937
27233
28595
30025
35499
41049

*for the first 1% of cost equipment


*for the 2nd yr = twice the first year cost
*for 3rd yr to end of life = increase od 5% annually

Table 6.8 Repair and maintenance of all equipments

36

Transportation of raw material


Year
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016

km
40
40
40
40
40
40
40
40
40
40
40

no. of trips/day
5
5
5
5
5
5
5
5
10
10
10

no. of truck used/day


2
2
2
2
2
2
2
2
4
4
4

Cost/L
31
33
35
37
39
40
42
44
46
48
50

Cost/day
954
1011
1070
1128
1187
1245
1304
1363
5686
5920
6155

Cost/yr
248000
262828
278077
293327
308577
323826
339076
354326
1478301
1539300
1600299

*1L
diesel/10km

Table 6.9 Cost of transportation of raw material

37

Revenue
Year
preoperation
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015

Sales(m3/day)

Selling Price(php/L)

24
24
24
24
24
24
24
24
47
47

25
25
26
28
30
31
33
34
36
37
39

Sales(Php/day) Sales(Php/yr)
5344
5344
5664
5992
6321
6650
6978
7307
7636
15928
16585

1389505
1389505
1472582
1558023
1643465
1728906
1814348
1899789
1985231
4141345
4312228

Table 6.10 Projected revenue

38

Inventory of Finished Goods


Year
pre-operation
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015

Beginning Inventory
0
26
26
26
26
26
26
26
26
26
51

Production Sales(m3/day)
24
24
24
24
24
24
24
24
47
47

24
24
24
24
24
24
24
24
47
47

Ending Inventory
26
26
26
26
26
26
26
26
26
51
51

*213.77 L/day bunker fuel is saved using 24 m3 in pre-heating


water

Table 6.11 Inventory of finished goods1

In business management, inventory consists of a list of goods and materials held available in stock.

39

Project cost
2006
Fixed Capital Expenditures
Equipment
Production Equipment
Total
Pre-Operating Expenses
Trial-run cost
Pre-operating salary and wage (design
team)

304100
304100

22742
180000

*No working capital is included in the project cost because on the fist day of operation we already have a savings which could suffice the cost of operation.
*No working capital is included in the project cost because on the fist day of operation we already have a savings which could suffice the cost of
operation.

Table 6.12 Project cost

40

Manufacturing Cost
Cost of Production
2006

2007

2008

2009

2010

2011

2012

2013

2014

2015

Raw Materials
Manure

248000

262828

278077

293327

308577

323826

339076

354326

1478301

1539300

Manpower
Supervisor
Driver
Laborer
Total

134063
214500
214500
563063

138084
220935
220935
579954

142227
227563
227563
597353

146494
234390
234390
615274

150889
241422
241422
633732

155415
248664
248664
652744

160078
256124
256124
672326

164880
263808
263808
692496

169826
543444
407583
1120854

174921
1119495
629716
1924133

17520

18396

19316

20282

21296

22360

23478

24652

25885

27179

3041

15205

15965

16764

17602

18482

19406

20376

25368

30411

3600
6641

7200
22405

7560
23525

7938
24702

8335
25937

8752
27233

9189
28595

9649
30025

10131
35499

10638
41049

6082

6082

6082

6082

6082

6082

6082

6082

15542

15542

360000

396000

435600

479160

527076

579784

637762

701538

771692

848861

Electricity
Repair and
Maintenance
Digester
Vehicle Rent
(Truck)
Total
Depreciation
Digester
Vehicle rent
(truck)

41

Total

366082

402082

441682

485242

533158

585866

643844

707620

787234

864403

Licenses &
Insurance
Registration
Total

10000
10000

10000
10000

10000
10000

10000
10000

10000
10000

10000
10000

10000
10000

10000
10000

20000
20000

20000
20000

1211305

1295665

1369953

1448826

1532699

1622030

1717320

1819119

3467774

4416064

Total
Manufacturing
Cost
Beginning
inventory
finished goods
Ending
inventory
finished goods

4659

4983

5269

5572

5895

6239

6605

6997

13338

4659

4983

5269

5572

5895

6239

6605

6997

13338

16985

COST OF SALES

1206647

1295341

1369668

1448522

1532376

1621686

1716953

1818727

3461433

4412417

*5% INCREASE IN
ELECTRICITY

Table 6.13 Cost of production

Cost of sales is an economical term describing the sum of all expenses that directly contribute to the generation of revenue. The cost of sales for a
merchandising firm typically includes the cost of the inventory sold, warehouse and transportation costs, and other costs associated with bringing inventory to
stores. It does not include costs associated with retail stores, and wages for retail employees.

42

INCOME STATEMENT
Revenue
Cost of Sales
Operating Profit
Administrative
and Marketing
Profit before
Income Tax
Income Tax
Profit after
income Tax

2006
1389505
1206647
182858

2007
1472582
1295341
177241

2008
1558023
1369668
188356

2009
1643465
1448522
194942

2010
1728906
1532376
196530

2011
1814348
1621686
192662

2012
1899789
1716953
182836

2013
1985231
1818727
166504

2014
4141345
3461433
679913

2015
4312228
4412417
-100188

41648

41659

41670

41682

41693

1156

1168

1179

1191

1203

141210
49424

135582
47454

146685
51340

153261
53641

154837
54193

191506
67027

181669
63584

165324
57864

678721
237553

-101391
-35487

91787

88128

95345

99620

100644

124479

118085

107461

441169

-65904

*35% INCOME TAX

Table 6.14 Income statement2

Revenue is used worldwide to measure increase of assets or decrease of liabilities during an accounting period. A synonym of revenue in accounting
terminology is income.
2

Income statements for companies indicate how Net Revenue (money received from the sale of products and services before expenses are taken out, also known
as the "top line") is transformed into Net Income (the result after all revenues and expenses have been accounted for, also known as the "bottom line"). The
purpose of the income statement is to show managers and investors whether or not the company made or lost money during the period being reported.

43

Balance Sheet
Assets
Cash
Inventories
Finished Goods (EI)
Others
Equipment
digester
Total
Depreciation
digester
Total
Book Value
digester
Other assets pre-op
expense
Total assets
Liabilities
Income Tax
Accounts payable
Total

2006

2007

2008

2009

2010

2011

2012

2013

2014

2015

185287

319138

464885

613313

761005

904254

1024819

1132467

1365767

1039289

4659

4983

5269

5572

5895

6239

6605

6997

13338

16985

304100
304100

304100
304100

304100
304100

304100
304100

701419
701419

701419
701419

304100 304100 304100 304100


304100 304100 304100 304100
6082
6082

12164
12164

18246
18246

24328
24328

30410
30410

36492
36492

42574
42574

48656
48656

64198
64198

79740
79740

298018

291936

285854

279772

273690

267608

261526

255444

637221

621679

162193

121645

81097

40548

650157 737702 837105 939205 1040590 1178100 1292950 1394908 2016326 1677953

49424
2105
51529

47454
3493
50946

51340
3664
55003

53641
3843
57484

54193
4031
58224

67027
4229
71256

63584
4437
68021

57864
4655
62518

237553
5215
242767

44

-35487
5786
-29701

Stock's holder equity


Balance,beginning
Net profit (loss)
Balance, end
Total stockholder's
equity

506841
0
91787
91787

506841
91787
88128
179915

506841
179915
95345
275260

506841
275260
99620
374880

506841
374880
100644
475524

506841
475524
124479
600003

506841
600003
118085
718087

506841
718087
107461
825548

506841
825548
441169
1266717

506841
1266717
-65904
1200813

598628 686756 782102 881721

982365

Total Liabilities and


Stock holders equity

650157 737702 837105 939205 1040590 1178100 1292950 1394908 2016326 1677953

1106844 1224929 1332390 1773558 1707654

Table 6.15 Balance sheet5


. Other pre-operating expense includes amortization. Accounts payable includes electricity with 5% increase per annum, repair and
maintenance, and office supplies.
1

Asset is anything owned which can produce future economic benefit, whether in possession or by right to take possession, by a person or a group acting together, e.g. a company, the measurement of
which can be expressed in monetary terms. Asset is listed on the balance sheet. It has a normal balance of debit.
2
Net Book Value is the original acquisition cost, less accumulated depreciation, depletion or amortization. Book value is therefore relevant insofar as it forms the basis of various calculations e.g. of
nominal capital gains (current value divided by book value), of amortized value (book value adjusted for depreciation) and of several financial ratios (e.g. price to book value P/BV).
3
A financial liability is something that is owed to another party. This is typically contrasted with an asset which is something of value that is owned. The basic accounting equation relates assets,
liability, and capital in the form of equity:
4
the shareholders' equity refers to the amount of assets that are owned by a company's shareholders. However, there is much more to this value. Stockholder's equity is perhaps the most abstract
concept to grasp in terms of the accounting equation when compared to its counterparts: assets and liabilities.
5
A balance sheet, in formal bookkeeping and accounting, is a statement of the book value of a business or other organization or person at a particular date, often at the end of its "fiscal year," as
distinct from an income statement, also known as a profit and loss account (P&L), which records revenue and expenses over a specified period of time.

45

Cash Flow
Profit
Add back:
Depreciation
amortization of pre optg
expense
Increase (decrease) in current
liabilities
Decrease (increase) in non-cash
current assets
Total cash receipt from
operations

2006
91787

2007
88128

2008
95345

2009
99620

2010
100644

2011
124479

2012
118085

2013
107461

2014
441169

2015
-65904

6082

6082

6082

6082

6082

6082

6082

6082

15542

15542

40548

40548

40548

40548

40548

51529

-582

4057

2481

740

13032

-3235

-5503

180249

-272468

-4659

-324

-286

-303

-323

-344

-367

-392

-6341

-3647

185287

133852

145747

148427

147692

143249

120565

107649

630619

-326478

Less disbursements
additional equipment

397319

Total capital expenditures

397319

Net cash inflow (outflow)


Cash balance, beginning
Cash balance, end

185287
0
185287

133852
185287
319138

145747
319138
464885

148427
464885
613313

147692
613313
761005

143249
761005
904254

120565
904254
1024819

107649
1024819
1132467

233300
1132467
1365767

-326478
1365767
1039289

Table 6.16 Cash flow1.


Additional equipment includes digester which will be bough in year 2014.
1

In finance, cash flow refers to the amounts of cash being received and spent by a business during a defined period of time, sometimes tied to a specific project.

46

Breakeven
2006

2007

2008

2009

2010

2011

2012

2013

2014

2015

1206647

1295341

1369668

1448522

1532376

1621686

1716953

1818727

3461433

4412417

Revenue
Sales bunker (L/day)
Selling price

214
22

214
23

214
25

214
26

214
28

214
29

214
31

214
33

428
31

855
20

Break-even price

22

23

25

26

28

29

31

33

31

20

25.00
186

25.00
199

26.49
199

28.03
199

29.57
199

31.11
201

32.64
202

34.18
205

35.72
373

37.26
456

186

199

199

199

199

201

202

205

373

456

12
6000

11
5750

11
5650

11
5450

11
5400

10
5300

10
5250

10
5250

11
5500

17
8500

Cost of sales

Revenue
Selling Price
Sales bunker (L/day)
Break-even volume
bunker (L/day)
Break-even volume BG
(m3/day)
Break even no. of pigs

Table 6.17 Breakeven analysis1

The breakeven point in economics is the point at which cost or expenses and income are equal - there is no net loss or gain, one has "broken even"

47

ROI
PAIT
i
(1+i)^n
sum
diff (equity and PAIT)
Interest (%)

2006
91787
0.175
1
78116
503188
-3,654
17.5

2007
88128

2008
95345

2009
99620

2010
100644

2011
124479

2012
118085

2013
107461

2014
441169

2015
-65904

1
63832

2
58774

2
52263

2
44937

3
47301

3
38188

4
29577

4
103339

5
-13138

Table 6.18 Rate of investment1

In economics the rate of return on investment refers to the benefits to an investor (the profit) relative to the cost of the initial
investment. It is similar to the rate of profit as a measure of profitability.

48

Payback Period
Equity
Year
Profit to date

506841
2006
91787
91787

Payback period

2007
88128
179915

2008
95345
275260

4.4

yrs

2009
99620
374880

2010
100644
475524

2011
124479
600003

2012
118085
718087

2013
107461
825548

2014
441169
1266717

2015
-65904
1200813

Table 6.19 Payback period1

PBP is a measure of the speed with which an investment is recovered by the cash inflows it produces

49

CONCLUSION AND RECOMMENDATION

The decrease in bunker fuel usage of Hi-grade feeds for the boiler is our major concern in
our study. In accordance with this, we have made a proposal study which considers all
factors of the farm and present technology that they are using.

After our market, technical and financial study of biogas from pig manure we came up
the following conclusions:

Hi-grade farms could increase the value of there waste by converting it to biogas

Biogas can be used to save bunker fuel usage by pre-heating the water entering
the boiler

The profit on the biogas system is good because it will save amount of bunker
fuel

We bought additional equipment on year 2014 to maximize the use of hogs


manure since the demand in the feeds and supply in farms increases.

For further enhance the proposed study, we recommend the following:

Removal of sulfur and carbon dioxide in the biogas which will increase its value
because it can be stored in a tank and can be sold

Use of biogas as a substitute to produce electricity.

Assessment of health problems. This could be done by providing proper suits to


the employees of the feed mill to prevent them from having diseases due to the
hogs manure. The employees should also maintain cleanliness and orderliness
around so they could do their jobs accordingly without hassle and worrying about
their health.

50

Building a digester that will meet the demand of year 2010 at the start of the
project. The purpose of building an additional digester is to meet the demand on
the feed mill as well as the supply of hog manure. The demand and supply is
based on the information given to us by Engr. Teresita P. Madulid. At this year
the number of hogs are already doubled, resulting to a 24,000 number of hogs.

Possibility of transferring the boiler to the farm which means that some part of the
process in the feed mill will also be transferred.

51

APPENDIX

MATERIAL BALANCE
Number of pigs: 12,000
Manure per day of pig: 3.27 kg
Basis: 1 day operation
Weight manure = 39,240 kg
Pre-treatment (Dilution)
- Dilution occurs in pig pens
Manure contains25% solid and 75% liquid
Wt. of solid (A) = (39,240 kg)(0.25)
= 9,810 kg
Wt. of liquid (B = (39,240 kg)(0.75)
= 29,430 kg
- Diluted solution must only have 10% solids
C (H2O)
A, B, C

A, B

X=A+B+C
Solid Balance:
9,810 = 0.10x
x = 98,100 kg
X=A+B+C
98,100 = 9,810 + 29,430 + C
C = 58,860 kg
Digestion
X

BG
Digester
Sludge (Y)

Biogas Computation:
- Volatile solids (VS) is 80% of total manure solids
- Only 49% of VS is broken down by bacteria
- 0.0613 m3 gas per kg volatile solid

52

VS = (9,810 kg)(0.8)
= 7,848 kg volatile solid
Amount broken down by bacteria = (7,848 kg VS)(0.49)
= 3,845.52 kg
Volume of Biogas produced = (3,845.52 kg)(0.0613 m3/kg)
= 235.73 m3
Y = (A broken down by bacteria) + B + C
= (9,810 3,845.52) + 29,430 + 58,860
= 94,254.48 kg

53

Volume Computation of Digester


Digester contains:
- Biogas
- Diluted Manure
- Sludge
Biogas
- Conversion of volatile solid broken down by bacteria to Biogas is estimatedly
complete after 10 days. So a total of 9.82 m3 is produced 10 days after the manure
is fed to the digester
- Assuming the amount of biogas produced per day is uniform, 0.982 m3 biogas is
produced everyday.
VBG = (235.73 m3) / (10 days) = 23.573 m3/day
Diluted Manure

manure = 993.3 kg/m3


H2O = 1000 kg/m3
Volume of diluted manure:
= 39,240 kg x 1m3___ = 39.50 m3
993.3 kg
Volume of H2O
= 58,860 kg x 1m3___ = 58.86 m3
1000 kg
total volume = 98.36 m3
density of diluted manure (40% manure & 60% water):
= (0.6) (1000 kg/m3) + (0.4) (993.3 kg/m3)
= 997.32 kg/m3

Sludge
amount of sludge = 94,254.48 kg
volume of sludge = 94,254.48 kg x __m3__
997.32 kg
= 94.508 m3

54

Computation of dimension of digester


Slurry volume= Sv := 78.45m3
Volume of slurry holder = Vd := Sv 1.5
with ( 50%a)allowance

Vd = 1.177 10 L

Height of slurry holder =


Length of slurry holder =

Hs := 3.05m

Lh :=

Vd
Hs

Lh = 6.211m

Width of slurry holder =Wh := Lh


Lh = 6.211m

Volume of biogas = Vbg := 23.5 1.5m3


with 50% allowance
Height of biogas holder =

Hbg :=

Vbg
( Lh Wh )

Hbg = 0.914m

55

Computation on savings of bunker fuel


Information regarding Hi-grade farm
Distance of Hi-grade farm to feeds
Amount of water used to feed the boiler
Amount of bunker fuel used for boiler

20 km
430 kilo/hr
50 L/hr

Assumptions
Time value of money is not considered
Minimum wage is P325 per person
Operation Schedule
Mondays through Fridays (22 days a month)
Sixteen hours work per day
Basis of computation
Transportation:
A diesel engine will use 1L per 13 m
Diesel price is P31/L
Bunker fuel is P23/L
Computation for final temperature upon pre-heating
Given:
23.573 m3 BG/day
Basis: 1 hour
Solution:
1kg CH4 x 1 kmol CH4 x 1000 mol
23.573 m3 BG x 0.6 parts CH4 x
1 part BG
0.68 m3 CH4 16.043 kg CH4 1 kmol
= 1,296.497 mol CH4
Hrxn methane = -890.4 kJ/mol
q = -890.4 kJ/mol CH4 (1,296.497mol CH4)
= -1,154,400.929 kJ
considering heat loss of 50%,
Since qmethane = qwater,
qwater = mcpT
577,200.465 kJ = (430 kg/hr)(16hr/day)(4.186 kJ/kgK)(T-25)
T = 45.04 C
Therefore the possible temperature that the water can be heated is
T = 45.04 C
Computation of the bunker fuel used
Existing process (without pre heating)
q = mcpT + latent heat
= (430 kg/hr)(16hr/day)(4.186 kJ/kgK)(100-25) + 88.0 kJ
q = 2,160,064 kJ/day
This amount of heat consumes 800 L/hr bunker fuel or 2,700.08 kJ/L.

56

Applying to the proposed process


The heat needed for the process is 2,160,064 kJ/day. The source of heat is from the biogas
which gives 577,200.465 kJ/day and 1,582,863.535 from combusting the bunker fuel.
Amount of bunker fuel used = (1,582,863.535 kJ)/(2,700.08 kJ/L)
= 586.23 L/day
Savings in amount of bunker fuel = 800 L/day 586.23 L/day = 213.77 L/day

FINANCIAL STUDY
PRE-OPERATING EXPENSES
Trial run = (62*10) + [(406+406+508) * 10
= 13,823
Pre-operating salary and wages:
= total compensation design team + total compensation of project consultant
= 180000 + 120975
= 300975
TOTAL:
= Trial run + Pre-operating salary and wages
= 13823 + 300975
= 314798
AMORTIZATION:
= Total/5
= 314798/5
= 62960
ADMINISTRATIVE AND MARKETING
For year 2006:
Office Supplies = 1200
Amortization (Pre-Operation) = 62960
TOTAL:
= Office Supplies + Amortization
= 1200 + 62960
For year 2007:
Office Suppplies = (12000)*(1.01) = 1212
Amortization = 62960
TOTAL = 64172
PRE-OPERATING SALARIES WITH BENEFITS

57

Project Design Team (Students)


Quantity = 4
Days = 60
Salary/day = 600
Benefits = (0.25)*(600) = 150
Total Compensation = (60)*(600+150)*(4) = 180000
Project Consultant
Quantity = 1
Days = 12
Salary/day = 10000
Benefits = 81
Total compensation = (12)*(10000+81)*(1) = 120975
Total Pre-operating and Fringe:
= total compensation design team + total compensation of project consultant
= 180000 + 120975
= 300975
LABOR COST
Engineer/Supervisor
Quantity = 1
Days = 22
Salary/day = 406
Benefits = (406)*(0.20) = 81.2 = 81
Total Compensation = (22)*(406+81)*(1) = 10725
Laborer
Quantity = 10
Days = 22
Salary/day = 325
Benefits = 81
Total Compensation = (22)*(325+81)*(10) = 89375
Cover = 20000
Digester
Volume (m3) = 173
Area (m2) = 25
Length (m) = 9
Width (m) = 9
Height (m) = 2
Cost (2006):
= total compensation of supervisor + total compensation of labourer + grand amount
(material and pipings) + cover
= 10725 + 89375 + 206553 + 20000

58

= 326653
Truck = 2000000
TOTAL = Cost (2006) + Truck = 326653 + 2000000 = 2326653
Cost (2014)
= Cost (2006)/ [(CPI 2014/CPI 20006)]
= 2326653 / [(275.961/211.215)]
= 426785
TOTAL = 426785
DEPRECIATION
For year 2006
BIOGAS: Digester
Quantity = 1
Cost = 326653
Estimated Life = 50
Depreciation (per year)
= cost / estimated life
= 326653/50
= 6533
BIOGAS: Delivery Truck
Quantity = 1
Cost = 2000000
Estimated Life = 10
Depreciation (per year)
= cost / estimated life
= 2000000/10
= 200000
For year 2014
Digester
Quantity = 1
Cost = 426785
Estimated Life = 50
Depreciation
= cost / estimated life
= 426785/50
= 8536
REPAIR IN MAINTENANCE
For year 2006:
Digester

59

= digester cost * 0.01


= (326653)*(0.01)
= 3266.53
Truck
= cost delivery truck * 0.01
= (2000000)*(0.01)
= 20000
TOTAL = 3266.53 + 20000 = 23266.53
BUNKER FUEL FOR BOILER
For year 2006
Consumption(L/year) = 37
Cost per liter = 23
For 2007
Cost per liter
= (23)*[(CPI 2007/CPI 2007)]
= 24.38
INVENTORY OF FINISHED GOOD
For year 2006
Sales (m3/day) = 24
Ending inventory
= volume of biogas + volume of digester
= 23.57 + 2.0025
= 25.595
Selling price (Php/L) = 23
Sales (Php/day)
= (amount of bunker fuel saved)*(selling price)
= (213.77)*(23)
= 4917
Sales (Php/year)
= sales(Php/day)*52*5
= (4917)*(52)*(5)
= 1278345
PROJECT COST
Fixed Capital Expenditures
Equipment:
Production Equipment = 326653
Transport Equipment = 2000000
TOTAL = production cost + transport equipment
= 326653 + 2000000

60

= 2326653
COST OF SALES
For the year 2006
Raw Materials:
Manure = 16368
Manpower:
Supervisor =134063
Driver = 107250
Labourer = 107250
TOTAL = summation of manpower = 348563
Electricity
= 25*20*12*365*10/1000
= 21900
Repair and Maintenance:
Digester = 3267
Truck = 20000
TOTAL = summation of repair and maintenance = 23267
Depreciation:
Digester = 6533
Truck = 200000
TOTAL
= summation of depreciation = 6533 + 200000 = 20653
Licenses and Insurance
Registration = 10000
Insurance = (production equipment)*(0.01)+(10000)
= (326653)*(0.01) + (10000)
= 13267
TOTAL = summation of licenses and insurance = 10000 + 13267 = 23267
Total Manufacturing Cost
= manure + summation of manpower + electricity + summation of repair and
maintenance + summation of depreciation + summation of licenses and insurance
= 16368 + 348563 + 21900 + 23267 + 20653 + 23267
= 639897
Beginning Inventory of finished good = 0
Ending Inventory = total manufacturing cost / (52*5)
= 639897 / (52*5)
= 2461
Cost of Sales
= total manufacturing cost + beginning inventory of finished good ending inventory

61

= 639897 + 0 2461
= 637435
INCOME STATEMENT
For year 2006
Revenue = 1278345
Cost of Sales = 637435
Operating Profit = Revenue Cost of Sales
= 1278345 637435
= 640910
Administrative and Marketing = 64160
Profit Before Income Tax = operating profit administrative and marketing
= 640910 64160
= 576750
Income Tax = (0.35)* profit before income tax
= 201862
Profit after income tax = profit before income tax income tax
= 576750 201862
= 374888

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