The economics of radiation processing

Radial. Printed

Phys. Chem. Vol. in Great Britain

42, NOS 1-3,

pp. 147-161,

1993

0146-5724/93 Pergamon

Polymerization

Ionicorp,

4 Watch

+ 0.00

Press

Ltd

and Curing

THE ECONOMICS OF RADIATION

Anthony

$6.00

PROCESSING

J. Berejka

Way,

Huntington,

NY 11743,

USA

ABSTRACT 'Iheec-its of ultravioletand electronbeam curing and processingare discussed in terms of capital and materials expense. Specific informationis presentedon the oft cited benefits of energy and space savings.Ihe overall ecmanic benefit of this process technologyto a firm is consideredfran the perspectiveof its environmntal impact,value-addedproduct potentialand opportunitycost.

THE GLOBAL

MARKETPLACE

In the global marketplace,(l) classic econanic laws of supply and dmsnd and of resource allocation effect performance.The increasedinternationalization of ecomnic realities,enhancedby technologytransfers,lead to more camm assessmnts of such performme. 'Iheuse of radiation curing and processing,whether low energy usage through photoinitiationfran ultravioletlight 'onizationvia electronbems, or usage of the n-me daninant higher electronbeam pro~s~132~ as in the crosslinkingof wire and cable jacketing,tire cunponentsor film and tubings, contributeto the return on invesbrentin a firm or interprise.Said investmentmay cane fran private sources, joint public and private enterprisesor fran the public damin itself. In general, the use of radiationcuring and processinghas a positive benefit not only on the econmics of a given fins or enterprise,butt0 the cannon good or wealth of anation. DEFINITION

OF TERMS

Technologistsrely on symbols to camunicate and to simplify their dialogue and informationexchange. Such symbols can stand for rudimentaryor elementalconcepts, like the use of C for carbon, H for hydrogen and 0 for oxygen in chmistry. More canplex interrelatimshipsare also expressed in simplifiedform. For example,MC stands for the mlecular weight between the crosslinks in a polymeric system. This powerful concept representsthe tightnessor degree of cure in a material, be it a crosslinkedhigh mlecular weight plastic film or a cured coating, ink or adhesive.c3) Physicistsus IX' in equatingmass to energy. Econanistsalso rely on symbols to enhance their dialogue.Four such abbreviationsare used below: MC for marginal cost, MR for marginal revenue, TC for total cost and IR for total revenue. As in technology,a series of curves can be used to depict the relationshipsbetween these concepts. Fran these, one gains insight into the overall ecmanics of a fin, of a process or of a product line.(4,536) The definitionsfor these terms are: MARGINAL COST: lhe incrementof total revenue that cam3 fran selling on additionalunit of product. MARGINALREVFNUE: lhe incrementof total revenue that cams fran selling on additionalunit of product. TOTAL COST: Ihe sun of ALL costs incurred in producinga product, includingmaterials, labor, rent, orerhead, selling expenses,depreciation,taxes, etc. 147

148

ANTHONY

J.BEREJKA

FIXED COST: 'Ihearrountof cost which a firm incurs independentof output, whether or not it is producinganything,such as rent and overhead. VARIABLE COST: 'Ihecosts incurredthrough the productionof given quantitiesof product, such as meterials and direct labor. Thus: Total Cost = Fixed Cost + Variable Cost TWIALREVEIUZ: The TRIAL income derived from the sale of products. PROFIT: he differencebetween Total Cost and Total Revenue. Thus: Profit = Total Revenue - Total Cost THE ECONOMICS MARGINAL

OF THE FIRM

ANALYSES

Classic, generalizedcurves show the interrelationship between the Marginal Cost (MC) and the , . Marginal Revenue (MR) for a firm, for a process or for a product line. These are found in basic c&,5,6) Many texts show the Marginal Revenue (MR) line to be flat when texts on microeconanics. describingcanpetitivemarkets, which is probably an unrealisticassumption.Here, there is sune decline in price and thus Marginal Revenue @lR)with respect to volume. In truly canpetitive markets, there are volume discounts,prive cunpetitionand/or price erosion resulting fran an overall excess of market supply. Marginal Costs (MC) fall as volume output increases.However, at sane point, economiesof scale for a given operation case and Marginal Costs (MC) can actuallyrise as volume exceeds the optimrm econunic capacity for a process or productionline. In converting,printing and coating applications,the question of ultraviolet (W) versus electron beam (EB) curing or processing,can be analyzedwith this type of econanic construct. In terms of Marginal Cost (MC) and Marginal Revenue (MR), one attains profitabilityat significantly lower vola output when using ultravioletcuring (W). The Marginal Cost 0%) for a W process starts out at a lower cost/unitpoint, reflectingthe differencesin capital outlay between ultravioletand low energy electron beam equipment. Assuming a single ultravioletunit does the ssnnething, such as curing an ink or a coating, as a single low energy electron beam unit, there are recognizeddifferencesin the volume output or productionthrough-putcapabilitiesbetween these two process technologies. With ultraviolet,ineconaniesof scale are reached at significantly lower volumes. The law of diminishingreturns sets in at lower vol- output for ultraviolet processingthan for low energy electronbeam usage.

MARGINAL

COST

VERSUS

MARGINAL

MARGINAL

REVENUE

COST

ULTRAVIOLET

MC

\ /

$/unit

volume output

VFnSrlS MARGINAL VERSllS ELECTRON

REVENUE BEAM

USE

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149

Processing

TwrAL COST AND RE7muE ANALYSES ----

A more canprehensive economic model shcrrws the relationship between Total Cost (Tc) and Total Revenue (TR). This trrxlel will be used to demonstratethe impact of many of the featurescited as benefits for ultravioletand low energy electron beam curiqg and processing.'Ihegeneralizedrelationshipbetween Total Cost ('ICIand Total Revenue (TR) shows that costs exceed revenue until sane breakevenpoint is reached. As with the marginal analyses,Total Cost (TC) can exceed Total Revenue (TR) at sane point where volume cutput exceeds econanic productioncapacity,again a point where ineconaniesof scale set in. 'Iheobject of the firm or enterpriseis to maximize the size of the da-rainabove the Total Cost (Tc) curve and below the Total Revenue (TR) line, that is to rrraximize its profits and its profit potential,which in turn maximizes the return to investors. A more detailed representationof this same concept is also found in texts dealing with microeconomics.

TOTAL

TOTAL

COST

VERSUS

TOTAL

COST

VERSUS

TOTAL

REVENUE

REVENUE TC

TR

$/unit

L(

volume

output

Here regions of loss and profit are shown as well as the classic breakevenpoint. Within the danain of profitability,there is one point at which the distance between the Total Cost ('ICI curve and Total Revenue (TR) line reaches a msxirtxnn. Here, profits are maximized. The curve at the bottan reflects this relationshipbetween profit and VO~URZ. As with the Marginal Cost and Marginal Revenue nxdel, the Total Cost and Total Revenue mxlel can be used to distinguishbetween the basic economic realitiesof ultravioletand low energy electron beam curing and processing.Given its lower capital investment,again ultravioletcuring and processing is able to reach breakevenat significantlylower volumes than law energy electron beam curing or processing. Likewise,given the overall lower energy output of ultraviolet equipment,lumens of light versus kilowattsof electron hem energy, millijoulesversus megarads, the ineconaniesof scale are noted at lower productionvolumes for ultravioletprocessingthan for typical low energy electronbeam uses. 'Ihecrux of the differencebetween W and FB curing and processing,between ultravioletand low energy electronbeam uses, is one of output or productioncapacity. Granted there are scmeunique things that each of these energy transfermechanismsdoes which the other cannot, shch as the ultravioletcuring of photoresistsfor electronicccmponents,the ultravioletspt curing of adhesiveswith light sources guided through fiber optics and the low energy electron beam curing of adhesives through thick, opaque layers and foils. II-, many cases, the business decision of whether to go W or EB, assuningboth processes can produce the asme end product, is whether or not the firm can market and sell the volume output fran a given process. In many ways, the mar-

150

ANTHONY

J. BEREJKA

ketplace has alreadymade this determination. Ultravioletlight initiatedcuring is widely used to cure inks and coatings in narrow web operations. Low energy electronbeams are used in converting and curing wide web materials, includingpolyethylenefilm nudificationand crosslinking. Ultravioletlamps are rated in hundredsof watts per inch, whereas electronhems units are reted in hundreds of kilmatts. With lrm ehergy electron beams higher line speeds can be attained, several times that of ultravioletsystems. Electronbean technologyis more often used for continuous,long run production.aereas operationswhich requiremltiple changeoversfavor ultravioletcuring technology.c9)

TOTAL

COST

IILTRAVIOLET

THE IMPACT

OF UV/EB

VERSUS

TOTAL

VERSII:: ELECTROIJ

ON COSTS

REVENUE REAM

IISE

AND REVENUE

Total Cost (TC) is a caspositeof fixed and variable costs, their smtion. Graphically,a fixed cost line remains parallel to the volune since such costs are incurred irrespectiveof the quantity of goods produced. Capital equipment,its depreciation,rent or additions to plant floor space, essentialpersonnelor overhead 6sanagenent,technicalstaff, etc.> are all canponentsof this fixed cost base. I--FIXEDCOSTCaMPCNENTS A) CAPITALEQUIPMENT: Adopting ultravioletor lm energy electronbeam processing involvesthe acquisitionof defined pieces of capital equipment-- ultravioletcuring units or low energy electronbeam installations. aen consideredon an incrementalcost basis, that is the amount such installationsadd to the total costs of a given process line, radiationprocessingis quite economicand relatively inexpensive.

Both ultravioletlight and electronbeam are form of radiant energy. Both are relativelyeasy to use. Both can augment most convertingand processingoperations. Ultravioletradiation and low energy electronbeams are used in the curing or crosslinkingof coatings, inks and adhesives. As radiant energy, ultravioletlight and electron beams directly convert reactive liquids to solids, and do not have to rely on energy intensiveevaporationsystems to remve solvent or water. Although there is a technical1differencebetween the ability of light or electron beams to penetrate msterials, another differenceis of greater econanic consequence. Gjhenconsideringtheir cafmercialuse, the relativecost of the equipnentneeded to generate these forms of radiant energy mst be taken into account. A law energy electronbeam acceleratorhas a substantially higher capital cost than a full line ultravioletcuring system.(10,ll) EXAMPLE = Capital -for

Printing:

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Consider the use of ultravioletlight curing in printing.A canplete 20 cm (8 inch) wide, five color rotary letterpresscan cost between $8oo,CKXI and $1,5~,~ dependingupon its degree of added sophistication. when interstationultravioletcuring units are included,they will represent less than lo"/. of this capital cost. With ultraviolet,such a press can produce high quality printed matter and canply with the demsnd for no volatile organics. Less expensiveflexographic presses cost in the range of $350,000for a 25 cm (10 inch) wide, five color unit and can also be manufacturedwith interstationultravioletcuring units. Ultravioletneed not be thought of as a curing techniquesuited solely for finishingor overprintsituations. Sane existing presses can be retrofittedwith UV for as little as $7,CCMl per station. Here again, this represents at nest lo"/. of the total capital cost of a five color flex0 press. The installationof ultravioletdrying units is an alternativeto other capital installations,like forced air ovens or infraredunits, which bear their own costs and significantprocess debits. EXAMPLE = -Capital for Converting: Heretofore,electron bemn or EB curing has been viewed as a relativelycapital intensiveprocess. Whereas ultravioletcuring units are but a small incrementalcost when integratedinto a process such as printing, electronbeam equipnentdoes indeed require a nnmh higher level of investment. Iow energy electron beam units, which are capable of handling wide webs at high productionthrough-put,cost anywhere fran $ 750,OCOupYard to nearly $l,ooO,ooO,with the more expensive units needed to handle materialswhich require higher dose exposure. The electronbeam current output, beam voltage and width or area of exposure are dictated by the derrrands of a given application. In many instances,such capital costs, even for wide web printing,are easily justified. Lay energy electron beam capital costs are now on a par with or even noticeablybelow the costs for the most rudimentarysolvent recovery or incinerationsystems. With their history of being 'user friendly"as well as envirornnentally sound, electronbeam curing and processingsystems pose less operationalproblems and fewer headaches for plant supervisorsthan other types of drying or curing ovens and/or canplex solvent recovery systems. A sophisticatedcoating line which could canplementa low energy electronbeam system can cost nearly $5CHl,ooO. Such a line would be capable of rrraintaining a 300 meter/minuteweb speed (loo0 feer/minute1, have turret unwinds and rewinds, flying splice capability,autanatedweb tension control and guiding systems,and a sophisticatedcoating station, such as a differential gravure system,with an autanateddelivery system. aen canbining such coater costs along with the costs of a low energy electronbeam unit, the total capital cost for a high speed (300 meterbinute), wide web (1.0 to 1.5 meters> productioncoating line would be in the neighborhood of $1,25O,ooO . These canplete electronbeam systems costs are in the order of msgnitude of nest add-on solvent recovery or solvent incinerationsystem. When consideringless-than-thebest emission control technologyfor volatile organic curtpounds (VOC' s> of solvent recovery or incineration,one mst also include the operationalcosts and the lower yields of the slawer productionrates of equipmentused with these systems. tich slower productionrates are noted for waterbornewide web convertinglines,which sune view as a solution to VOC control. Fnvironmental laws and govemnent regulationsin many countriesare now denending the reductionand practical eliminationof all emissions into the atnospherefran industrialprocesses. EXAMPLE = -_Capital for Kxxd Finishing: In the wood finishing industry,ultravioletand 1~ energy electronbeam processinghas been used to cure particle board fillers, to bond laminatesand in the finishingof furniture,cabinets and ready-to-assembleflat gocds. As in other applicationareas, process speed, elimination of volatile organic canpounds (VCK's),and the overall versatilityand cost-effectiveness of radiation curing have won msny converts to loo"/, non-volatileradiation curable coatings. Curtain and roller coaters are efficientways to apply ultravioletcurable coatings. With inline sanding or denibbing,line speeds of 14 meters/minute(45 feet,ininute) can be achieved. With no in-line sanding or denibbing,line speeds up to 60 meters/minute(200 feet,fninute)are attainablewith a fully cured coating, ready to be handled by plant personnel,caning off the line. A roll coating line equippedwith ultravioletlamps and all of the systems needed to handle flat stock can run in the range of $ 165?ooO. Ultravioletcurable coatings can be applied with robotically controlledspray heads. PIgmented systems have been developedwhich cw be cured by ultravioletphotoinitiation. By judiciouspositioningof light sources and reflectors,ultraviolet light can be used to cure the edges of flat stock as well as three dimensionalobjects RK 42-1/3-L

ANTHONY

152

J. BEREJKA

conveyed through curing ch&rs by speciallydesigned handling equipment. As in the printing industry,the incrementalcost for adding ultravioletcuring capabilityis negligible. when one considers the speed and efficiencyof ultravioletcuring for wood products, such a process line should have a relativelyshort payback period when scrutinizedin any capital appropriationreview. B) -RENT OR PLANT FLOOR SPACE: Ultravioletcuring units are relativelysrralland canpact. It is difficult to locate the ultraplaced within the press itself. violet units on printing presses, since they are so ccrnpactly However, in wide web convertingapplications,the use of low energy electron beam processing translatesinto considerablespace savings,especiallywhen cunpared to alternativeprocess technologies. Self-shielded,low energy electronbeam units are easily fit into a conventionalweb coating line and do not occupy that much space. The schematicof Figure 1 shows the efficient space utilizationof an electronbeam curing line. A typical coating line with electron beam curing can require only five meters (16 feet) of plant floor space in length. This contrasts sharplywith more historic drying lines which need floor space 25 to 45 meters (80 to 150 feet) in length to accanrwdatetheir drying ovens. In SouthernCalifornia,for example,where floor space for a light industrialplant of 9300 square meters (lOO,CKXl square feet) can run around $8.10/!1? ($ 0.75/ft2)per month to rent or $40/m' ($ 50.00/ft2).to build, the space savings foml a low energy electronbeam line is economicallysignificant. A productionfacilitycould house three or more electronbeam lines on the same plant floor space occupied by other types of drying or curing equipment.Assuming a reasonableperimeterof about one meter (three feet) on each side and 2.5 meters (8 feet) at each end around a coating unit, the floor space for a low energy electron beam line could be about 30 meters' (325 ft'), whereas a line with lengthy drying ovens would need around 150 meters' (1600ft'), This space differentialalone exceeds $ 970 per rronth in a rental or use cost for plant floor space or $ 64,800 in unnecessaryconstructioncosts, if any additionalplant floor space were required to accarrrcdate a forced air drying or curing oven. C) -NEW FIXED ---COSTS FOR THE 1990'S: Economicshas always consideredboth capital equipnentand rent, process hardware and floor space, as covnents of fixed cost. In the present United States econany, some have observed additional fixed costs for doing business,which are less well defined, but real nonetheless. (13) These "new" fixed costs for business in the United States are: -- EmployeeHealth Care __ Liability Insuranceor Costs of Litigation __ EnvironmentalCosts Such "new" fixed costs contributeto an imbalancein the ability of same firms to cornpetein the global marketplace. Companiesproducingcaaparablegoods in less litigioussocietiesrequire less liabilityprotection. Canpaniesproducinggoods in countries in which health care costs are borne to a greater extent by the entire society also have a cost advantage. These costs drive up fixed costs and thus Total Costs. Graphically,this upward shift of fixed costs shows an intrusioninto the danain of profitabilityor profit potential for carrpanies doing business within the United States. Similar econzraic imbalancesin cost profiles can also be seen in other developed industrialsocieties. Whereas the need to install equipmentto meet environmentaldemands varies from country to counconsciousness,most developed societies intry.(14) Becauseof their heightenedenvirornnental cur a cost penlty here. (15) Fortunately,with ultravioletand electronbeam curing and proca-apliance are reduced.(16) Of the process technocessing, the actual costs for envirornnental logies available for pollutionpreventionor mission control, ultravioletand electron beam technology has as proven record of being THE environmentallyfriendly technology. The capital costs for implementingthis best availablecontrol technologyare not that significant. FIXEDCOST SUIWIRY: --In a Total Cost analysis,various fixed cost casponentsare considered: FIXEDCOSTFACT0G --- CAPITAL/DEPRECIATICN

8th International Meeting on RadiationProcessing

153

-ArNINIsmATIVEoVmmD -BUIlDm/REm/sPAcE -RES~CH/DW~ -Ih'EWST/TAXES -EWUWWNTALcosrS 'Iheeconanicsof a firm, a process or a product line is effected by added fixed costs resulting fran the impact of added capital investment,incrementaladditions to floor space (assuningno conversionto ultravioletor low energy electronbeam curing and processing)and the new costs for environnentalcmpliance. As a result, profit potential shrinks and higher vo1m-e is needed in order to reach breakevenas Total Cost ('IC) llylves upward in proportionto such increasesin fixed costs.

TOTAL COST VERSUS + INCREASED

TOTAL

REVENUE

FIXED COSTS

\ $/unit

11 --

VARIABLE COST cO%WENE

A)MATERIAU: Ultravioletand low energy electronbeam curing and processinghas often been subjectedto the suppositionthat the materials used in this process technologyare unwarrantedand expensive. Given the degree of sophisticationrequired to meet a mltiplicity of market demsnds, these radiation curable mterials will perhaps always renain in the category of specialtychemicals.However, as with all materials,as velure dmmd increasesand producingcanpaniesare able to attain greater econaniesof scale, the basic materialsused in these envirorrnentally friendly systemswill fall. Figure 2 depicts the overall relationshipbetween materials prices and total volme. (The general slope of this line still holds when correctedfor currentmarket volunes and prices.) 07) EXAMPJX = Printing: 'Iheprinting industrygives an insight into whether these allegationsof high materials costs are true. With envirormmtal factors,product quality, and production speed in its favor, the ultravioletor electrm beam curing of inks and/or gloss coatings is cost canpetitivewhen viewed on an applied cost basis. Amming that the sam intensityof ink or coating coverage is needed irrespectiveof the ink vehicle, Table I shows ultravioletlight curable materials to be the mst cost effectivewhen consideredon a dry weight basis. B) ENERGYUXXIMFTION: Efficientenergy utilizationand envirom-rzntal air quality are intimatelyintertwined.Amsjor source of air pollutants,which threaten to bring on global warming, are electricalgenerating plants peered by fossil fuels. These plants emit large mrmnts of carbon dioxide, the natural by-productof canbustion,along with other deleteriousgaseous emissions,like sulfurousand nitrous oxides.

154

ANTHONY

Table

I.

Printing Standard

J. BEKEJKA

Applied Coating Cost Comparisons: UV, Waterborne and Solvent Based Systems

Material

-

waterborne

Percent Solids

Approximate Sales Price ----

Applied or Dried Cost

42%

$ 3.3O/kg $ l.SO/lb

$ 3.57

Catalytic

waterborne

50%

$ 5.3O/kg $ 2.40/lb

$ 4.80

Catalytic

solvent

10%

$ 5.5O/kg $ 2.50/lb

$ 3.85

100%

$ 7.15/kg $ 3.25/1b

$ 3.25

UV curable

Ass-s

based

coating

454 grams or 1 pound of dried coating consumedper 93 m2 or loo0 ft'.

In the tiited States, representativesfrom severalmajor electricalutilities (such as Southern CaliforniaEdison, the SouthernCompany Servicesof Atlanta and the MississippePower Cunpany) are supportiveof the ultravioletand electronbeam processingapproach to curing and drying. Not because this method is dependenton electricalenergy, but because it is a highly efficient use of electricalpower. Within the United States, all electricalutilities are in favor of energy efficiency. Energy efficiencyor savings not only heps utilities cope with their own set of emission standards,but it also reduces their dependenceon foreign fossil fuels and the vicissitudeswhich such non-U.S. suppliesare subject to in terms of supply and price. EXAMPLE = --Drying Versus UV/EB: Distillateshave long been used to reduce applicationviscositiesto enable paints, coatings, inks, or adhesivesto be applied in thin layers to various substrates. Canpared to any waterborne systems,organic solventspermit more efficientmanufacturingprocesses.Process or coating efficiencyis easier to attain by relying on faster drying solvent systems,with their lower heats of vaporizationand lower boiling points, than any aqueous systems. For ex;nnple, a cum-only used organic solvent,heptane, has a boiling point of 98 'C, nearly the same as that of water, but has nearly double the vapor pressure at ambient temperatures(35 nrsof Hg cunpared to 17 mn of Hg for water at 20 "C) and a substantiallylower heat of vaporization(only 76 calories /gram canpared to 540 calories/gramfor water at their boiling points). Such distillatesare indeed more volatile and are properly termed "VolatileOrganic Gxnpounds"or VOC' s. With electron beam curing, the Carson unit for dose exposure is the megarad, which is equal to only 2.39 calories/gramor 10 Joules/gram.A typical electronbeam cured coatingmay require just 3 Mrads or only slightlyover 7 calories/gram(30 Joules/gram)to effect a complete cure and not require any additionalenergy input to drive off volatiles like solvent or water. In producing the same product for which electronbeam curing requires only 7 calories/gramto cure a coating or an ink, 76 calories/gramor 540 calories/gramneede just to vaporize a diluent in either solvent based or waterbornematerials,not to mention additionalenergy requirementsstill neede to achieve cure with these other systems. FXAMPLE = -UV Curing Efficiency: Besides ultravioletlight initiation,other forms of electrunagneticenergy are used for curing. Radiant energy beyond the visible range, such as infraredor heat (lOUHz), microwave (lO1%z), or radio-frequency(108 Hz and below), even when at high intensitiesor wattage output, generate a different sequenceof material changes. At these higher frequencies,molecular vibrations rmst be first inducedwhich in turn raise molecules to sufficientlyhigher energy states to create chemical changes. These other forms of radiant energy, while in themsilvesmore efficient than energy transfervia c onvectionor conduction,are more indirect than either ultravioletor electron beams in terms of chemical effects. 'Ihisis a consequenceof the basic physics of ultravioletand electronbeam energy transfer. Table II shows the amount of energy needed to cure ccmparablecoatingsusing energy sourceswhich use differentparts of the electqetic spectrum. (18)

155

8th International Meeting on RadiationProcessing

Table

Energy

II.

Needed

to Cure Wood

Fillers Energy

Frequency

System

Needed

Infrared

1012 Hz.

1600 kJ/m'

Radiofrequency

lo8

Hz

330 kJ/m'

Ultraviolet

1015 Hz

64 kJ/m'

[The high polarity of wood and its mxsture content contributedto a m3re positive response to RF heating.1 EXAMPLE = EB Energy Efficiency: -Using low energy electron beam to cure coatings also results in significantenergy savings. Even the latest designs in air impingementconvectionsystems or the use of infraredheaters are, at their best, 20% energy efficient. tich of their energy is dissipatedin heating the surrounding environment,even when focused as well as possible,on a transversiqgweb and/x contained in well insulatedchambers. Unlike these other forms of energy transfer,an electronbeam unit, whether scanned or generatedfrun a segmentedor linear filament,directlybcmbards the web. Table III shows that as electricaldevices, electron bea acceleratorslose very little electrical power in convertingincoming line paYer to the voltages and amperage,that is the actual wattage, used for electronbeam curing.(l9) In terms of cons-r electricalproducts purchasedwithin the United States, electron beam acceleratorswould have a very high "E" or energy efficiency rating. Table

III.

Voltage

Beam Available Beam Power --- Area

200keV 250keV 300keV

Needed

Line Power -Beams

120 kW 150 kW 180 kW -- Scanned

300keV 500keV 800keV l.OMeV

90 50 80 100

kW kW kW kW

1.5MeV 2.0Mev 3.OMeV

97.5kW 100 kW 90 kW

Electrical Effeciency

-88.9 % 90.9 % 90.0 %

135 kW 165 kW 200 kW Beams

--

kW kW kW kW

90.0% 83.3% 84.2% 83.0%

130 kW 135 kW 120 kW

75.0% 74.1% 75.0%

100 60 95 120

In electron beam processing,the voltage of an acceleratordictates the velocity of the enitted electrons and thus the depth to which electronscan penetratematter. ne beam power is the availablewattage which results from the product of the beam voltage times the msxinxunbeam current. The current of an acceleratorgoverns the intensityof the electron flow and thus controls the product throughputrate. A canbinationbeam current and the response of a given msterial's chgnistry is needed in order to predict the msxirnsnweb speed which can be run using an electron beznncuring unit and still achieve full cure or a desired crosslinking.Applications,which rely on area bezms made with either longitudinalor segmentedfilaments,can achieve line speeds in excess of 300 meters per minute (loo0 feet per minute), EXAMEW= --EB &ergy Costs: Since the costs for the industrialuse of electricityvary widely throughoutthe United States and throughoutthe world, the electricalpower costs for operating an electronbeam curing unit will also vary. &I Long Island, New York, industrialcosts for electricityrun as high as 11.09 cents per kilowatt-hour(alnxxst as high as those in Berlin ,>:whereas in the state of alahans pawer costs as little(;;F.15 cents/km (not quite as low as the 4.12 cents/km in the Canadian province of qUebec),

In evaluatinga mxlel facility to be located in Southern

156

ANTHONY J.BEREIKA

California,where the South Coast Air Qality ManagementDistricthas regarded ultravioletand electronbeam curing as one of the Pest AvailableControl Technologies,as determinedunder the idelinedsof the United States Clear Air Act, one can assume a pcwer cost of 7.50 cents/k&. ?-l 21) For a one shift, 2OCKlhour annualizedproductionoperation,the electricalcosts for running a 300 keV, 600 mA electronbeam curing unit would be only $ 30,ooO (200 kW need line power x 2000 hours x $ 0.075/k%). Assuning the use of a one meter wide acceleratorand a chemistry capable of being run at 300 meters per minute (18,ooOmeters per hour) or an annualized productioncapacity of 36,000,OOOm2, the pawer costs for curing such a material in a wide web operationare less than 0.1 cents/m'. This estimate should be ccmparedwith the costs of solvent and with the costs for heating a square meter of material to drive off a solvent or water and then to pranote a cure. In environmental terms, these operatingcosts for electricalenergy for an electronbeam curing unit are less than half the annualizedcosts for the catalyst replacemnt needed in an incinerationsystem designed to meet the new requirementson reductionsof volatileorganic emissionsand about a third of the fuel costs needed to operate such an incineratorto control such emissionsfran a canparablewide web line.(21) In other words, the day-day operationof an electron beam curing line incurs less than one-sixth the cost of just the catalystsand fuel needed for an incineration system (not to mention the added costs of solvent and heating for web drying) because of its efficientuse of electricalpower! VARIABLECOST SUMARY: -In a Total Cost analysis,considerationis given to the differentccqonents of variable cost: VARIAEUCOSTFACTORS --- NATFRIALS/SUPPLIES -ENXGY~SuMPTIcN -DIRECTLAPXIR -WASTEMANGBEU Consideringthat, on an applied cost basis, the materials costs for ultravioletlight or low energy electronbeam curing are canparablewith those of other systems and that, in using either ultravioletlight or low energy electronbeams, there is a significantsavings in the cost of energy needed to operate these curing and processingunits, the variable costs for a firm, for a process or for a product line can be loweredwhen using these forms of radiationcuring and processing.

TOTAL COST VERSUS

TOTAL

TOTAL

REVENUE

COST VERSUS

TOTAL

REVENUE

- REDUCED FIXED COSTS - REDUCED VARIABLE COSTS

t INCREASED FIXED COSTS - REDUCED VARIABLE COSTS

$/unit

Fixed Costs

volume

ou Lput

volume

output

Sane of the costs of increasedcapital expenditurecan be offset by reduced energy costs. There are sufficientoff setting cost benefits to economicallyjustify the capital needed for a process conversionto either ultravioletsystemsor low energy electronbeans. However,when one does indeed convert a process over to ultravioletor low energy ilectronbeans, one also realizes some notable fixed cost savings. Both ultravioletand electron beam curing have been proven to meet the new densnds of the 1990's for environmentalccmpliance. ~0th eliminatevolatileorganic canpounds.Both reduce the emission of pollutants.As a result, one can find both a decrease in fixed costs when using radiationcuring and processing. Convertingto ultravioletor elect-

8th International

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Processing

157

ron beam irradiationenhances a firm's profit potentialand widens the range of productioncutput over which reasonableprofitabilitycan be attained. In the case of electronbeam processing recall also that there is the added fixed cost savings in terrasof rent or floor space. III --REVEUUFENHANCEMENT INCRF&SINCPROFITS: ‘Ihe review of the cost side of the Total Cost versus Total Revenue picture opens the way for some remarks about the revenue side. Businessestypicallyrely on several revenue enhancenient techniques.

+ VALUE-ADDEDPRODKXS + PROPRIETARYPRODUCTS +LEADINGEDGEPRODUCTS + PRICE INCREASES With ultravioletand electronbeam curing and processing,the mO.stconrum approach to revenue enhancementis the creation and generationof high value-addedproducts. Cannon exsunples are found in the everyday consumermarket, not just in industrialapplications. Greeting cards made using the EBAluglas c23) process can-ssnd a higher price because of their decorativemetallic art work than ordinary cards. Designer shoppingbags made with radiationcured high gloss coatings also cam-and premix prices. Besides these decorativeitems, functionalmaterials are also found in the cons-r area. (24) Specialtyheat shrink barrier films are made with electronbeam processingand used to wrap poultry products so that the flavor and juices of these food products can be retained. Value-addedproducts are also widely found in the industrialsector. l?aterials which simplify product applicationand insure performanceccmnand premix prices. Electronbeam processedheat recoverabletubing is used to insulate the splices in teleccrmAln icationsand electricalwiring. Specialtyfilms with static control featuresobtained by electronbeam surface grafting are used in the packagingof electroniccanponents. In many instances,the value-addedproduct is also proprietaryand protectedby patents to further enhance the product'sor product line's revenue generation.(X) Revenue enhancementalso impacts effects the Total Cost versus Total Revenue model. Increasing Total Revenue (TR) is one way to enlarge the dasain of profitability. In s-y, radiationcuring broadens the profit potential for users by offering the opportunityfor revinue enhancerssnt and, at the sa time, by having the capabilityof reducing Total Costs. Many corporationsengage in various forms of economic analyses to guide them in decisionbraking. Ihe history of radiationcuring and processinghas shown that chqions of this process technology have emerged and catapultedtheir businessesinto a highly profitableposture by relying rroreon entrepreneurialskill than on fonralism.(26) However, formal systems can be useful in helping decide where and what product areas should be chosen to implementultravioletor electron beam curing and processing.(27,281 A 'Winner-Loser"Productbrket matrix shown in Figure 3 is used by sare. As one preceeds from the upper left hand comer representingthe existing product line toward the lower right hand comer toward diversification,one encountersgreater levels of risk. Sometimes,as in the present econanicraalaise,there seems to be a pervasiverisk-adverseculture. Wlsiness decisionmakers tend to reflect this culturalmalaise. Thus, a prudent strategy in convertingto radiationcuring and processingis probablyn-oreappropriatein order to exploit the merits of this process technology.Inrplgnetation of ultravioletor electron beam curing or processing in known product lines of known market value would be on order. Creation of entirely new and differentproductsmay, for mst, be too risky. (29) A successfulexample of such product line conversionto radiationcuring and processinghas been in the adoption of this process technologyby the manufacturersof siliconecoated release papers. Here both ultravioletand law energy electron beam curing is used to make conventional release papers, but was then found to be successfulin creating product line extensionsinto release coated films.

ANTHONY

158

TOTAL COST +

VERbUS

REVENUE

TOTAL

J.

BEHEJKA

VENTlJhE

REVENlJE

CASH FLOW

ENHANCEMENT $600,000

$300,000

year

(-$300,000)

\

l--_-

/

/ conventional Evaluation

(-$600,000) volume

output

No considerationof Total Cost (TC) and Total Revenue (TR) analysisof a firm, a process or product line would be completewithout sane mention of opportunitycosts. Such costs, while mentioned by many econanists,are rarely included in any formal cost analyses. Although opportunity cost is difficultto quantify,one can understandthat delaying response to the environmental demands of the 1990's will have its financialrepercussions. Indecisioncan have a dramatic effect on the cash flow of a firm.(30,311 Any company which goes through an inordinately long evaluationand decisionmaking process incurs costs and runs a negative cash flaw over a greater period of time than a firm which seizes an opportunity,such as convertingto radiation curing or processing. Such firms tend to be decisive and do not bureaucraticallyprolong economic analyses and business justifications. These decisive enterprisesalso do not get trapped in extended research and developmentefforts.

Figure 1

EB AND OVEN

DRYING/CURING

LINES

schematics courtesy of llirarloTecseed Co., Ltd, replasenterl I" the U.S. by TPXnlilC1°C. The oven dl-yinr,,c,,til,g llne h*s LI mnchine lenqth Both sketches are for 1.5m wide units. line I-M,“iRS Only 5I” of 45m and a maximum machine speed of 30m/minute. The 60 prOCt?E,SiXXJ of floor space and has a naxlnwm machfne spegd of 2OOm/minu~.c.

159

8th International Meeting on RadiationProcessing

Figure

PRICE-VOLUME

IO’

IO6

2

RELATIONSHIPS

IOR I’rodticlioll ()

Pricevs.production

itI lhc Unilcd

tIl)/ye:~r)

Sloles

PRODCICT-MARKET mowc-r PREBENT PflOOUCT -

MODIFIED MAnKET (INCREASED

SALES

MARKET DEVELOPMENT

-----~_--

MOUII-IED PnODUCT (INCIIEASED

I’nODUCT

EFFECTIVENESS On IlEDUCED COSTS) __

PnESENT MAnKET

MATRIX HEW

I’IIoI~uc DIS71FIClI.Y IIIJCT Wllll lOLOGY

I

NEW I’IIONEW IECII-

011 PllrJCESScS

___.__

Pnouuc r DEVELOPMENT

I’IIOL)UC I nEI’LACI:MEN

I’RODUCT IMPnOVEMENT

Pnowlcr-l_lNli EXTENSION

I

WITHIN I’IIESENT MADKETS)

m NEW MAnIcE-r (INCIIEASEU AND

NUMIJEI

NEW TYPES

OF

“OIINlm””OFI’III.SF,II II,,S,N,-sSm

PHOIJUCI APPLICATIONS

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I1011

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-s: 'Iheauthor wishes to express hes sincere thanks to n-anymenkrs of RaATech InternationalNorth Anerica for their willingnessto share relevant price informationon equ@mxzntand materials. Any misinterpretationof their input, used only as examples of costs, not intended to be firm price quotations,is solely the author's responsibility.

160

ANTHONY J. BEREJKA REFERENCES

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8th International 24. ~adak, William. “Radiation ges 19 to 36.

Curing:

Meeting new Market

on Radiation R ” X

161

Processing

in Chmical

Ehsiness,

October

1990, pa-

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September,1976, pages 554 to 564.

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