Chemical production process portfolio optimization considering resource integration

Abstract

Environmental concerns and depleting resources motivate economies to become more circular and encourage engineers to re-consider plant design by enhancing internal integration. This can be achieved by designing an eco-industrial park (EIP), in which a cluster of plants are synergistically integrated for mass and energy resources. Deciding which plants to include in the cluster determines its overall performance. In terms of economic performance, this is especially challenging as raw materials, products, and utility prices continuously fluctuate on the market, which results in the overall profit of a cluster becoming variable and imposes an investment risk to consider in decision making. In this study, Modern Portfolio Theory (MPT) is adopted to guide the selection of plants to be included in a process investment portfolio, considering both integrated (clusters) and non-integrated process plants or clusters. While integrated clusters typically enable improved returns through savings of energy and mass inputs over individual, stand-alone plants, their coupling may affect variability, and therefore, the risk dimension of portfolio construction. An MPT approach is proposed, which extends a recently presented MPT approach for stand-alone plant portfolio selection to consider optimally integrated clusters of plants, which are synthesized using an optimal design method that simultaneously considers all energy and material resources of a cluster. The MPT approach determines the process plant portfolios that are most attractive for investment from a risk-return perspective and the optimum capital distribution among portfolio constituents. A case study of six plants is presented to illustrate the MPT approach. The findings show that optimal risk-return portfolios do not consist of only integrated clusters of plants (EIPs) but are often complemented by stand-alone plants contributing to portfolio stability.