Solutions and Hints to the Applesoft Worksheets. Solutions to Applesoft Case Work

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2 Solution to Worksheet 10A: Developing a Process Flow Diagram

3 Solution to Worksheet 10B: Developing an Eco-map of Water

4 Solution to Worksheet 10B: Developing an Eco-map of Solid waste

5 Solution to Worksheet 10C: Developing the Material Balance for Apples

6 Solution to Worksheet 10C: Developing the Material Balance for Water

7 Solutions and Hints to the Applesoft Worksheets Solution to Worksheet 10D: Conducting Cause Diagnosis for Low Productivity Productivity is low (about 72%) Nozzles are inefficient Maintenance of nozzles is inadequate Poor Housekeeping (leakages) Skills on apple sorting and grading to be upgraded Handling practices need improvement Machines Management Methods Peeling m/c to be improved. Blancher could be replaced Materials Staff needs Training on env. Impacts of operations Processes exceed best practice norms Excess juice from Blancher is considered as waste Cores and Peels are disposed as wastes Fishbone Diagram

8 Solution to Worksheet 10E: Identifying and Screening Cleaner Production Options The options at the low or no cost end could include training of workers to do away with sloppy handling, improving the maintenance of spray nozzles, sending the organic waste as animal feed to the farmers.. Low to medium cost options could include replacing the spray nozzles with flat nozzles; exploring reuse of water used to clean apples for floor washing, operating the blancher by practice of holding to minimize steam requirements, using hot air from the blancher for the purpose of drying, etc. Medium to high investment options could include the recovery of sugar supplement from waste, improving the peeling machine with spring loaded knives, and replacing the original blancher with one having a higher product to steam ratio.

9 Option 1 : Sale of organic waste as cattle feed All the solid wastes generated at the plant i.e., fruit peels, cores, spoilt / damaged fruit and the packaging are presently dumped together along with the plastic, packaging wastes and broken crates. Instead of co-disposing the organic waste with the inorganic packaging waste, the company could sell the organic waste as cattle feed to the farmers. Cost and benefit calculations Income from the sale of organic waste = ( ) kg / day x 300 days x US$ 5 / 1000 = US$1,680 Savings due to reduced disposal of waste = ( ) kg / day x 300 x US$ 10 / 1000 = US$3,360 Total savings = US$ 5,040 /year The environmental benefit of Option 1 will be reduced nuisance to the neighborhood community and utilization of wastes.

10 Option 2: Replacement of shower type nozzles with flat nozzles The spray nozzles that are presently being used are shower-style and thus, very water-intensive. By replacing them with flat nozzles, water will be conserved. This improvement will also eliminate the manual washing practice (i.e. saving on time). Costs however will be incurred in replacing the 25 shower style nozzles (15 on the conveyor-washing system and 10 for cooling the blanched apples) with flat nozzles. Cost and Benefit Calculations Cost of flat nozzles = US$30 / nozzle Replacement of all 25 nozzles = US$ 750 Maintenance costs = US$ 250 / year Volume of water saved by the new nozzles = 40% x ( ) m 3 / day m 3 / day = 32.5 m 3 saved / day = 9,750 m 3 / year

11 Option 2: Replacement of shower type nozzles with flat nozzles Savings on water conservation = 9,750 m3 x US$ 0.2 / m3 x 1.2 (i.e. 20% anticipated increase in water rate) / year = US$ 2,340 / year The wastewater volume will be reduced by 32.5 m3/day (i.e. the same as the volume of water saved) = 9,750 m3/year Savings on wastewater treatment = 9,750 m3 / year x US$ 0.15 / m3 = US$ 1, / year Total costs incurred in conserving water = Capital costs US$ 750 and annual costs of US$ 250 / year. = US$ (2, ,462.50) US$ Total annual savings = US$ 3,802.50/ year The payback on Option 2 is about 2.5 months and can be implemented immediately since it requires only a small capital investment.

12 Option 3: Use of high-grade spring mounted knives for apple peeling Based on the brochure, the maximum peel loss will be 100 kg /ton. Hence, production will increase as follows: 4000 kg 400 kg ( spoilt and damaged apples) = 3600 kg / day Present loss of raw material in peels and core fleshings = 200 /1000 x 3600 = 720 kg Net salable production = 3600 kg 720 kg = 2880 kg /day After upgrading the peeling equipment: Loss of raw material in peels and fleshings = 100/1000 x 3600 = 360 kg Net salable production = 3600kg 360 kg = 3,240 kg / day The productivity will thus be close to 78%; closer to the target of 80% set by the company. Incremental production = 360 kg / day = 36 boxes /day Incremental earnings = 36 x 8 x 300 = US$ 86,400 / year Cost of upgrading the peeling machine = US$ 80,000 Payback period for Option 4 will be about 11 months.

13 Solution to Worksheet 11: Preparing a Proposal for Demonstration Project and For Securing Financial Assistance Option 4: Recovery of the excess juice from blanching through concentration, for use as a sugar supplement The excess juice from the blanching process contains sugars and fine apple pieces. The collected juice can be concentrated together with peelings and cores in a crusher-cumevaporator, and sold as a by-product to the food industry. Apart from generating revenue due to the recovery of a by-product, the implementation of Option 3 will result in substantial reduction in the BOD of the wastewater, thereby lowering the wastewater treatment costs. Costs incurred would be for the crusher-cum-evaporator equipment and working time. As there is no present operating data available on this technology option, this project may be considered as a demonstration project.

14 Cost and Benefit Calculations: For screening the demonstration project, two types of cost-benefit analyses could be done. Optimistic scenario: Cost of the crusher-cum-evaporator The amount of sugar supplement that can be recovered per day Revenue generated per day 15% of the capital of the crusher-cumevaporator is the operational cost Net revenue generated per year The payback period will be = US$ 100,000 = (15% of 2000 kg from the juice) + 15%(40% of 720 kg from the peelings and cores) = 344 kg = 344 kg x US$ 0.6 / kg = US$ / day = US$ 61,920 / year = US$15,000 = US$ 61,920 US$ 15,000 = US$ 46,920 nearly 26 months.

15 Pessimistic scenario: Cost of the crusher-cum-evaporator The amount of sugar supplement that can be recovered per day Revenue generated per day 15% of the capital of the crusher-cumevaporator is the operational cost Net revenue generated per year The payback period will be = US$ 120,000 = (10% of 2000 kg from the juice) + 10%(40% of 720 kg from the peelings and cores) = kg = kg x 0.5 = US$ / day = US$ 34,320 / year = US$18,000 = US$34,320 US$18,000 = US$ 16,320 nearly 88 months

16 Net Present Value (NPV) for optimistic scenario Cost of the crusher-cum-evaporator Effective life of the crusher-cumevaporator Depreciation Net Annual Savings 100,000$ 10 years 10% =Revenue generated (depreciation cost +operating cost) = (10, ,000) = 36920$ NPV = -CF o + CF 1 + CF 2 +. CF 10 (1+i) 1 (1+i) 2 (1+i) 10 = -100, = $ (1+8) 1 (1+8) 10

17 Net Present Value (NPV) for pessimistic scenario Cost of the crusher-cum-evaporator Effective life of the crusher-cumevaporator Depreciation Net Annual Savings 120,000$ 10 years 10% =Revenue generated (depreciation cost +operating cost) = (10, ,000) = 6320$ NPV for optimistic scenario = -CF o + CF 1 + CF 2 +. CF 10 (1+i) 1 (1+i) 2 (1+i) 10 = -120, = $ (1+8) 1 (1+8) 10

18 Internal Rate of Return (IRR) for optimistic scenario Cost of the crusher-cum-evaporator Effective life of the crusher-cum-evaporator 100,000$ 10 years Depreciation Net Annual Savings 10% =Revenue generated (depreciation cost +operating cost) = (10, ,000) = 36920$ IRR (solving for i) 0 = - CF o + CF 1 + CF 2 +. CF 10 (1+i) 1 (1+i) 2 (1+i) 10 0 = -100, = 58% (1+8) 1 (1+8) 10

19 Internal Rate of Return (IRR) for pessimistic scenario Cost of the crusher-cum-evaporator Effective life of the crusher-cumevaporator Depreciation Net Annual Savings 120,000$ 10 years 10% =Revenue generated (depreciation cost +operating cost) = (10, ,000) = 6320$ IRR solving for i = -CF o + CF 1 + CF 2 +. CF 10 (1+i) 1 (1+i) 2 (1+i) 10 = -120, = -12% (1+8) 1 (1+8) 10

20 Profitability Index (PI): Profitability Index is the ratio of present value of future cash inflows by present value of cash outlays General Formula: PI = (PV of cash inflows) (PV of cash outflows) If PV <1 The project should be rejected If PV >1 The project should be accepted Calculations: 10 PV of cash inflows = = 7740 t=1 (1+0.08) 10 PV of cash inflows = = 1875 t=1 (1+0.08)

21 Profitability Index (PI): PI = PI = PI is more then one therefore the project can be accepted.

22 No. Option title Savings made (US $/year) Payback period (months) 1 Sale of organic waste as cattle feed 5,040-2 Replacement of shower type nozzles with flat nozzles - recommended for internal finance 3, Recovery of the excess juice from blanching through concentration, for use as a sugar supplement - recommended for demonstration project Optimistic scenario Pessimistic scenario 46,920 16, Use of high-grade spring mounted knives for apple peeling - recommended for external finance 86,400 11