Extended Learning Exercise. You have been asked to prepare a quick estimate of the construction cost for a coal-fired electricity generating plant and facilities. A work breakdown structure (levels one through three) is shown in the table below EE! Click the icon to view the work breakdown structure Click the icon to view the available information What is your estimated 2019 cost for building the coal-fired generating facility? Summarize your calculations in a cost estimating worksheet, and state the assumptions you make Summarize your calculations in a cost estimating worksheet, and state the assumptions you make. (Round the factors for elements 1.2-3, 1.4 to four decimal places and the labor factor to the nearest whole number. Round costs to the nearest ten thousands dollars.) Element Code Units/Factor Price/Unit Subtotal Totals 620 $1,800 $3,100,000 1.2-3 $121,000,000 $5,100,000 1.5.1-3 labor $62 material:s $15,000,000 1.5.4 620 $1,300 3% The total estimated cost PROJECT: Coal-Fired Electricity Generating Plant and Facilities Title Line No. 001 002 003 004 005 006 007 008 009 010 011 012 013 014 015 016 017 018 019 020 021 022 023 024 025 026 027 028 029 030 031 WBS Element Code Coal-fired power plant Site Land improvements Roads, parking, and paved areas Railroads Boiler Furnace Pressure vessel Heat exchange system Generators Boier support system Coal transport system Coal pulverizing system Instrumentation and control Ash disposal system Transformers and distribution Coal storage facility Stockpile reclaim system Rail car dump Coal handling equipment Support facilities and equipment Hazardous waste systems Support equipment Utilities and communications system Security systems Project integration Project management Environmental management Project safety Quality assurance Test, start-up, and transition management 1.2 1.2.1 1.2.2 1.2.3 1.2.4 1.3.1 1.3.2 1.3.3 1.3.4 1.3.5 1.4.1 1.4.2 1.4.3 1.5.1 1.5.2 1.5.3 1.5.4 1.9.1 1.9.2 1.9.3 1.9.4 1.9.5 A coal-fired generating plant twice the size of the one you are estimating was built in 1996 The 1996 boiler (1.2) and boiler support system (1.3) cost $121 million. The cost index for boilers was 121 in 1996, it is 489 in 2019. The cost capacity factor for similar boilers and support systems is 0.91. The 620-acre site is on property you already own, but improvements (1.1.1) and roads (1.1.2) will cost $1,800 per acre, and railroads (1.1.3) will cost $3,100,000 Project integration (1.9) is projected to cost 3% of all other construction costs. The security systems (1.5.4) are expected to cost $1,300 per acre, according to recent (2019) construction of similar plants. All other support facilities and equipment (1.5) elements equipment elements for two similar generating plants. Their experience is expected to reduce labor requirements substantially: a 92% learning curve can be assumed. Viscount built the support facilities and equipment on their first job in 90,000 hours. For this project, Viscount's labor will be billed to you at $62 per hour. Viscount estimates that materials for the construction of the support facilities and equipment elements (except 1.5.4) will cost you $15,000,000 The coal storage facility (1.4) for the coal-fired generating plant built in 1996 cost $5.1 milion. Although your plant is smaller, you require the same size coal storage facility as the 1996 plant. You assume you can apply the cost index for similar boilers to the coal storage facility
