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Factor Determining Methanol Plant Scale

jasontaylor

Market limitations determine a plant’s scale in methanol production and not equipment limitations. This is because the market is an external factor that a business lacks control over. On the other hand, equipment is an internal factor that a business can have control over by investing more in equipment. Market limitations, especially in China are affected by the government. According to Yang and Jackson, the Chinese government delayed the approval of the nation’s 15 percent methanol. Such instances result in the production of methanol being limited to a small scale. Yang Jackson also states that the de-emphasis of methanol as a source of fuel in China significantly limits the methanol market which results in companies producing limited methanol quantity. The results in methanol plant scale reduction.
However, despite the de-emphasis, people prefer methanol in place of other sources of energy in most instances is that methanol prices are lower compared to other fuel sources like gasoline. China aims to minimize the greenhouse gas emissions produced by petroleum products. As a result, there exists a ready market for methanol as an alternative fuel because its consumption limits the emission of gases. According to Nami, the Chinese government does not tax methanol. Several Chinese automakers manufacture many methanol-consuming vehicles. These vehicles do not require extra costs to run on methanol because gasoline-methanol blends are widely used in gasoline engine vehicles, a factor that increases the methanol market.
The methanol industry is spread across the entire globe with production in South America, Europe, the Middle East, Asia, and Africa. According to the Methanol Institute, over 90 methanol plants have a production capacity of 110 million metric tons. The global methanol consumption reached 75 million tons in 2015 amounting to 40% of methanol consumption. Every day around 200,000 tons of methanol is used as chemical feedstock or transportation fuel which is enough methanol to fill nearly 7500 tankers. Therefore, considering many nations reduce market limitations associated with methanol sales as a source of fuel, methanol plants can adopt large-scale plants due to the availability of a ready market and few market restrictions. Based on the analysis, it is evident that market limitation affects plant scale and not equipment limitations.

Article by Jason Taylor a researcher at the Department of Social Communications at the Institute of Journalism and project manager at https://qualityessay.com/

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