Allocation of waste cost in thermoeconomic analysis

In any energy system there are unwanted residual output flows that are necessary to obtain final products. These are known as waste, and represent an exergy loss that has an inherent cost that must be “charged” to the useful products of the system. Calculation of production costs including waste depends on the allocation of these to productive components. The right way to allocate waste is by identifying the formation process of their cost, since every productive component must be charged only by the part of a waste cost it contributed to. Waste cost allocation is done by means of so called waste cost distribution ratios. Nevertheless, there is no a definitive way to determine these ratios. In this work we propose an improved definition of waste cost distribution ratios, based on the premise that waste must be allocated to the productive units that generated their cost. Two energy systems are used as case studies to demonstrate the methodology. It was found that the allocation of waste is significantly improved with the new methodology. Quantitative and qualitative results are satisfactory, since the cost formation process of waste is identified, allowing to perform an improved thermoeconomic analysis.

► The waste cost formation process is revealed.
► Allocation of waste cost is done according to the true responsibility of components.
► The method provides objectivity by not relying in the criterion of the analyst.
► The method proved to be an improvement over existing approaches.