JPRS ID: 9359 TRANSLATION ECONOMICS OF START-UP AND ADJUSTMENT OF NEW PRODUCTION BY G.A. KASHLINSKAYA

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JPRS L/9359
22 October 1980
Translation
ECONOMiCS O~' START-UP
AND A~DJUSTMENT ~.F NEW PRODUCTION -
~ By
~G.A. ~Cashlinskaya
FBI~ ~OREIGN BROADCAST INFORMATION SERVICE
FOR OFFICIAL USE ONLY
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NOTE
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JPRS L/9359
22 October i980
ECONOMICS OF START-UP AND ADJUSTMENT OF NEW PRODUCTION
Moscow EKONOMIKA PUSKA I NALADKI NOVYKH PROIZVODSTV (Economics
- of.Start-up and Adjustment of New Production) in Russian 1976
pp 3-137
[Book by G.A. Rashlinskaya, Stroizdat, 1976, 139 pages,
UDC 69.003:65~.152.011.46]
CONTENTS
Annotation 1
Chapter 1. Work Organization in the Start-Up Period 2
- Section 1. Essence of Start-'Jp and Adjustment Work 2
1. Composition and Place of Start-Up and Adjustment Work in
the Overall Process of Creating New Production Facilities. 2
2. Responsibility of Those Participating in Creating
New Facilities 12
3. Start-Up Facility 20
Section 2. Specialized Start-Up and Adjustment Qrganizations 22
Chapter 2. ~;nalysis of Start-Up Expenditurea of New Production 38
Section 1. Planning and Recompensing Start-Up Expenses........... 38 -
Section 2. Shaping Start-Up Expenses 46
Section 3. Expenditures of the Start-Up Period 60
Section 4. Correlation Analysis of Indicators of Start-Up Expenses 66
Chapter 3. Schedules for Starting-Up New Production 84
Section 1. Setting ScheduYes for Starting-Up New Production 84
' - a - [II - USSR - FOUO]
[III - USSR - 3 FOUO]
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Section 2. Analysis of Schedules for Carrying Out Stdrt-Up and
Adjustment Work 89
1. Analysis of Variance of Schedules for Carrying Out Start-Up
and Adjustment Work 89
2. Correlation Analysis of Schedulea for Carrying Out Start-Up
and Adjustment Work 53
Section 3. Using Network Planning T~ Reduce Schedules for
Carrying Out Start-Up and Adjustment Work............ 99
Section 4. Economic Effectiveness of Reducing Start-Up Schedules
for New Production Facilities 113
_ b _
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Annotation
[Text] Published in accordance with a 30 October 1974 de-
cision by the Construction Economics Literature Section of
the Stroyizdat editorial council. The book examines prob-
lems of the economics of the start-up period for new pro-
duction facilities, using the chemical industry as an ex-
ample. Methods are given for calculating normatives for
start-up and adjustment work duration and expenditures
during this period. Considerable space is given to de-
termining the effectiveness of reducing start-up time ~or
new pro~ects and to methods of improving start-up and ad-
justment planning and organization. The book is intended
for scientists and engineers in research, planning, con-
, struction, and start-up and ad~ustment organizations.
1
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Chapter 1. Work Organization in the Start-Up Period
Section 1. Essence of Start-Up and Ad~ustment Work
1. Composition and 1'lace of Start-Up and Ad~ustment ~~ork in the Overall Pro-
cess of Creating New Production Facilities
The creation of new production encompasses a whole series of ~obs, including
scientific research on developing new formulas and technological processea,
designing and manufacturing new types of equipment, planning and building en-
terprises, finishing and starting-up new production facilities.
Atl thia work can be divided into work preceding construction, construction
and installation proper, and work following completion of construction and
instel.lation work at the construction aite. The period of creating and mas-
tering n~a production thus includes:
scientific research;
designing and manufacturing new equipment;
pro~ect planning;
construction and installation;
putting new facilities into operation;
enterprises reaching the production volume and technical-economic
indicators prescribed in the plan.
- This period can be represented in the form of a chart which takes into ac-
count the fact that a number of ~obs are being done at the same time (Fig-
ure 1, following page). In the chemical industry, the preceding or prepa-
ratory stages average 5-8 years, sometimes longer. In this regard, 1-2 ,
years is spent planning the enterprise and the remaining time is taken up
by research (including working out the technology and experiments) and in
designing and manufacturing nonstandard equipment. By the start of con-
struction, the site must have available to it the planning documentation
and equipment anticipated in ~he p1an. From three to five years must be
spent building and installing equipment for new production using existing
norms in the chemical industry.
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_ Figure 1. Creating and Mastering a New Production Facility
- ( j ~ HpyvHO -~Ci
nCG~O:a~enocKue pn6om~
KCNCin,~�,~uQC OMu~ u UJ7Cm0~~Nv~
HO~a.r mun0~ 060py~OJaNUa ~ 2 ~
~
~ ~ 3 ~j~: ~TU^.�J~hue `4 Cm oum~n~tm4o ~ 5 nyc~ u Ha~naKu 6 Ocloeyue
:%r ~o... :.I~m,f P nppu3BodCmBa
. ~ (13 14~
(7 Cmpnum.t~eyae n6oma ~roMnn~~rNoevn- ~
Fa6vOQHUe o6apy- o ; v
( g).aaMma.~� o npy oDQ~ua do6aNUa v
~
p F ~ ~y
~ 7 HN uG~U yQAd~C2 0/!PO ~ ~ 11 n 0 0/U n C~ U 0~lJX1 IfQ 4 L' i~
~oBQy4e c6n oaaDanua . h i ~
~raMn~e~tNau nyrK c 4c~~odoM ~+a . 3 ;
~ 12 ycmod uu0a~1 e~uH adnma ~
Key :
� 1. Scientific research
2. Designing and manufacturing new types of ~equipment
3. Planning new production
4. Construction
- 5. Start-up and ad3ustment
_ 6. Utilization
7. Construction ~obs .
8. Equipment installation
9. Testing individual pieces of equipment
10. Comprehensive equipment testing
11. Trial start-up and check-out
12. Full start-�up, to steady aperating conditions
13. Production capacities
14. Technical-economic indicators
After construction and installation are cemplete, start-up and ad~ustment
work begins to put the facility into industrial operation. The start-up and
adjustment work which results in putting production capacities into opera-
tion is the final link in creating new production. Then comes utilization
of the capacities and economic indicators of production already in operation.
The normative start-up and adjustment period is 3-6 months, and the master-
ing period up to two years.i The creation and mastering of new produc-
tion thus requires many years, and reducing the above-indicated periods is
of enormous importance to increasing industrial efficiency.
T'he effectiveness of new production ie shaped at all stages of this work:
1. The SNi~ [construction norms and regulationa] cuzrently set norn?atives
only for mastering production capacities. There are no normative per-
iods for mastering technical-economic l.ndicators.
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at the planning stage, the technical foundations of the future en-
terprise with consideration of modern scientific and engineering require-
ments;
at the construction stage, previously developed planning decisions
are implemented; construction quality and duration influence effectiveness;
at the stage in which production capacities are started up, the ,
quality of the construction and installation work and of the equipment in-
stalled is checked; the quality of the equipment and technological process
check-out and the time involved in the start-up and ad~ustment work take on
special importance;
at the stage in which production capacities and technical-economic
indicators are mastered (in accordance with the indicators prescribed in the
plan), the time involved in reaching these indicators is very important.
ThE quality of the work done in preceding stages determines the level and
schedules for work in subsequent etages. Individual stages in the develop-
ment of new production are characterized by specific features.
As is evident from Table 1[following page], construction accounts for 60-75
percent of the whole development period for a number of new production faci-
lities in the chemical industry, time expenditures on start-up and adjust-
ment account for 5-10 percent, ar~d time spent on mastering capacities ac-
_ counts for 20-30 percent.
- During the construction period, capital investments are "frozen," withdrawn
from circulation, and it is or.ly after the facility is puC into operation
and its production and economic indicators are being fully utilized that the
national economy begins to obtain the effect anticipated by the plan. Thus,
society advances capital investments for a considerable time period in anti-
cipation of a long period of circulation in the future by obtaining a useful
effect expressed in growth in the social product.
Failure to meet construction schedules postpones the time when capital in-
w vestments will be recompensed and in so doing increases the time lag before
the effect begins. The final moment is understood to be utilization of the
planned capacities and economic indicators. In other words, the full econo-
mic impact can be obtained only when the output volume, production profita-
bility, labor productivity and net cost anticipated in the plan have been
achieved. On the other hand, any reduction in the lag between capital in-
vestment and obtaining the effect leads to increased capttal investment ef-
fectiveness.
Increasing construction duration generally makes it more expensive, since
some construction expenses are linked directly to construction time. Fifty
percent of all general overheads depe!ids on construction duration. Calcula-
tions show that every 10-percent increase in construction time increases the
net cost of construction-installation work by 1-2 percent.
Accelerating the rate of construction and start-up of new facilities is ex-
ceptionally important from the viewpoint of using the achievements of
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Table 1. Time Involved in Creating New Production in Individual Branches
of the Chemical Industry (Normatives), numerator = months, deno-
minator = percent
~ (d) it~on~aM~~rcr~,~~ocT~. ' -
~a~ ~b~ (e~ (f }a (8)
x s �
n.n Ilpm~~noricrnc? Bcero p ~ A~ p ~ o
r~~ C
Y e ~ V
= 7c~F wF�. ~K
R t p=F V fV~j m~
u mu7~t~ em ~z
35 23 I 12 3 9
1 Cepiw?i Kncnarw 100 G6 34 8.b 25,5
2 54 33 18 3 18
AMMi~aKa 100 GI 38,4 ~.5 33,5
3 Cnaf,ui? aaoTUUfi q I 17 16 5 ~
Knrnnria - - - -
!00 G6 4~~ IR,'l 22
4 I~MMIIilq110F1 cc- 24 18 ~ 9 2 4
AIIT~l6i - - - -
100 7b 37~5 8~5 ll
5 ~~icT~iicna 22 20 10 3 15
100 57 24 7~ 3~
~ Xnopa 43 30 Ib 3_ 10
!00 G9 35 ? 24
7 I(~npououoru g0 34 . 18 2 Q4
K~p1ta - 100 55,8 29,G 3,2 q(1
it K.w ponoiwro 5l 30 15 3 1$
W C.'1 K:1 -
!00 59 29,b fi 35
~1 Ailcrum~rnmo- ~I 29 13 7 15
no:iia -
l00 57 25,5 14 2g
I(1 ~ti~un 30 `l2 10 2 G
100 73 33 7
1( I~It11NJ18uCTATB 32 20 7 4 8
� 100 62,5 22 12,5 25
12 !(anpon~KTnMn G2 ~33 15 5~ 24
(00 52 24 8 40
13 !(pacnK, -,~i,i!icii, 3p 32 � 10' 2 G
:~~iiu,it i I(Hl 73 34 7 'lQ
Key : -
a. In order e. Conatruction
b. Production f. Including construction-installation
c. Total g. Start-up
d. Duration h. Mastering
[Key continued on following pageJ
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[Key to Table 1, continued]
1. Sulphuric acid 8. Capron silk `
2. Ammonia 9. Cellulose acetate
3. Weak nitric acid 10. Resin
4. Ammonium nitrate 11. Vinyl acetate
S. Methanol 12. Caprolactam
6. Chlorine 13. Dyes, enamels, varniahes
7. Capron [nylon-6] cord
scientific and technical progress in production. During the course of plan-
ning enterprises, construction and technological decisiona are generally made
at the level of modern scientific and engineering achievements. However,
during the creation of the facility newer and more progressive, more econo-
mical resolutions might arise. Fac~lity construction and util.ization delays
therefore cause equipment to become obsolescznt and reduce the period of its
efficient operation.
The finish of capital construction and erecting the faci3tty still does nc~t
make it possible to begin operating the production facility. Before the
fixed assets created during the construcCion period can be put into opera-
tion, we are faced with checking the readiness of the equipment f~r opera-
tion and adjusting the technological conditions and operation of all inter-
acting systems. And that is what start-up and ad~ustment work is. It oc-
curs only when putting new production capacities into industrial operation,
so work done during the start-up period ia of a one-time nature.
Start-up and ad~ustment work has a dual purpose. On the one hand, it is con-
nected with the completion of capital construction and is a check of the in-
stallation quality and of the conformity of construction to the plan. On the
other hand, it is the initial stage in the operation of the facility, the
stage in which the workability and reliability of the planning resolutions
are checiced .
In preparing and performing the technological process, start-up and ad~ust-
~ ment ensure and organize the initial stage of the operation period. In this
regard, they are closely associated with the period of utilizing a new faci-
lity; they precede it, and the mastering period depends to a considerable ex-
tent on the quality of this work.
- Only pro~ects at which construction-installation work ie finiah~d and at
which production aesets have been prep~red to begin opArating and can in
. fact be operated can b~ considered finiahed.
After construction is complete, production must be set up, the required op- _
erating speeds must be ensured, the prescribed product output and quality
and the necessary operating smoothneas muat be ensured, and additional ma-
terial and labor resources are directed into this work during the start-up
period.
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Start-up and adjustment begin when we switch ov~er from testing individual -
pieces of installed equipment, which ~ompletes the builders' work, to com-
prehensive equipment testing done for the entire technological system of the
production facility by enterprise operating personnel, with the participa- -
tion of specialized start-up and ad~ustment subcontractor organizations.
Individual pieces of equipmenC are ordinarily tested either at idle or under
_ load ir~ inert media (water, compressed air). Construction must be complete
prior to testing individual pieces ~f equipment under luad. Testing indivi-
dual pieces of equipment under load is the finish of equipment installation.
When individual types of equipment cannot be tested under load apart from a
complex of related equipment, the finish of installation work is considered
to be the testing of individual types of equipment. Equip~ent installati~n _
is thus a complex of jobs related bot:~ to ass~embling and instailing equip-
ment and to checking that it conforms to p~anning and teclinical resol~itions.
The comprehensive equipment testing which begins the start-up period is done
in inert media, with subsequent changeover to operating media. It is the
purpose of this work to bring productiou up to planned operating conditions,
- with the release of test output as cutl.inP3 by the plt~n. Comprehensive test-
ing in inert media is done to check the quality of equipment installation,
reveal the ability of individual subassemblies anci technological systems to
function, and adjust rem~te-control regulation and control systems~.
= The duration and type of comprehensive equipment testing depend on the na- ~
ture of the production. W~~en the SNiP does not include comprehensive test-
ing recommendations for individual types of equipment, the duration is set
at a working level of 24-72 hours of normal uninterrupted operation of the
individual types of equipment under operating conditions prior to the start-
up and adjustmen~ of the technological complex as a whole.
After eliminating bugs and making final ad3ustments on the equipment, the
entire productian facility is started up, ending in the release of the first
test lots af quality output and putting the facility on a steady technologi-
cal oper2ting routine. In a number of cases, workers from organizations
setting up the production and sCarting up the facility remain at the ~enter-
prise for 15 days after the initial lots are obtained to render technical
assistance, continue observing the production process, and making recommen-
dations to ensure uninterrupted operation and improved equipment operating
conditions.
It follows from the above that work in the start-up period includes:
1) comprehensive testing af individual types of equipment using in-
ert media to check the operability of all subassemblies of the technological
system;
2) trial starr-up af individual technological stages, units and
prociuction equipment using working media;
3) final adJustments and start-up of the w�hole facility, bringing
it up to a steady technological routine, and the trial release of quality
output as anticipated by the plan.
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In order to ensure the prompt, proper start-up of new capacities, producti.on
start-up is preceded by work in t~he prestart-up period, when the engineering
inspection and preparation to releas~ the facility to the customer take place.
In the prestart-up period, which begins while construction is still under~ray,
planning, construction and installation quality are monitored, as is equip-
ment quality, personnel are trained, and the thoroughness with which the fa-
cilities are being completed is checked.
The quality with which capacities are prepared for start-up is one of the
basic conditions for the successful putting of new production facilities into
operation. Planning documentation is reviewed during this period and the en-
terprise leadership is sent observations and recommendations regarding the
plan.
Changes are made in the technical documentation already sent to a contractor
for execution only with the permission of the ministry, with the submission
of materials to the all-union associations which will run that particular en-
terprise.
Therefore, when planning organizations dfl not aIIree with such observations,
the enterprise leadership appeals to the corresponding ministry sll-union
association.
There is an engineering inspection of instali�ation progress and the conform-
ity of the work being done to the plan, of the technically complicated in-
stallation of individual units, internal elements of apparatus and installa-
- tions, at the construction-installation atage. The work echedule notes each
unit of equipment installed, each technological subassembly.
Installation quality is checked ~!n accordance with the technical norms and
conditions on installation. Flaws revealed are called attention to and must
be promptly eliminated.
Incoming equipment is also checked and inspected in the prestart-up period;
any structural shortcomings in technological, power and other types of equip-
_ ment are revealed.
In order to ensure high-quality preparat~on of production for start-up, there
is engineering monitoring of equipm~nt pressurE-testing by fitters and of the
- testing of utilities and individual pieces of equipment in accordance with
specifications and the SNiP.
Technological raw material, fuel, basic and auxiliary materiala must be pro-
vided in accordance with plan requirements when preparing a pro~ect for
start-up: electric power, steam, water, compressed air, waste water clean-
ing and purification facilitiea, stack gas cleaning devices, communications
and warning devices, living quartera equipment, personal protective devices
and work clothing. This ensurea normal etart-up and ad~ustment work.
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_ Al1 start-up period work i3 done according to a schedule drawn up in the
form of a grid line graph or a calendar plan reflecring all work involved
in preparing the production for start-up and the start-up itself, and it
must indicate the schedules for performing individual work stagea.
Ttie work procedure for the start-up period is indicated in a special instruc-
_ tion drawn up with consideration of all changes made in the plan in the pre-
start-up period. Organizational and technical documents are attached to the
start-up instrucrion: plans f or (air) blast-cleaning apparatus and pipe-
lines, plans for starting up individual lines and units, and a lfst of all
_ the materials needed in the start-up period.
Under the "Ru~es for Accepting Finished Enterprises, Facilities, Shops and
_ Production for Operation in USSR Chemical Industry," operational technical
supervision of the entire complex of start-up and ad~ustment work is en-
trusted to specialized start-up and ad~ustment organizations. _
After a pro~ect has been p~it into operation, representatives of these or-
- ganizations, together with the enterprise, draw up a program for utilizing
the capacity and work to put the facility in steady production of output .
corresponding to the plan in terms of quality and quantity.
The entire complex of this work is called etart-up and ad~ustment. In terms
of content and time of implementation, it is aubdivided into engineering su-
pervision of the quality of the construction and equipment adjustment being
done, starting up the production, as well as assistance in utilizing the ca-
pacities. Table 2 diagrams this.
Table 2. Start-Up and Ad~ustment Work
~ I1j~rlWycnwwll ucp~uyl I~2^l~~pn~.1 uyckn uponi� I~3QIopm;R ncr+uenOn
unncnm wouuwcmll
~ 7) 10) .
I(n,i;i~ucpm,ui n.~:l� ICUMlllil�i,cnuc 011~10� I~CXIIItqCCK~fi rto�
J(l~ J~I K71~ICCTO(tM: riU8811IIC O~OrY/~q0i!� MOU~L II UCHOC�
II~~OCR'1'11011 ;l1~NY. IIIIA. IIIIN MU~IUIUCTCII.
_ (5).,~our;iiuw 8~~~Pn~iuwi~ irycK o60� (11('~3p3Go�r~a pe-
crpuFric!mno~n+ou- pynooain+N, utlteni~ni~s KUMI`IIlIiUlNll no
'fFI7h~II.IX ~.160T TCXHbJIOfH'ICCKfIx ni~� o6ecnc~icnHiv ~CC-
~6~ oGu~,}�~;ounnHN uuii. ncpeGoi~noit paGo�
9tOrnaAKa u xon~� rw oC,opyRo~eni~na
nleKCi~wi? nycK npo-
?+_+ooncTna
Key :
l. Prestart-up period 6. Equipment construction and
2. Production start-up period installation
3. Capacities utilfzation period 7. Comprehensive equipment teating
- 4. Engineering quality aupervision: 8. Trial start-up of equipment and
5. Planning documentation individual technological
lines
[continued on following page]
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[continuation of key to Table 2]
9. Final adjustment and comprehensive start-up of production
10. Technical assistance in utilizing capacities
11. Development of recommendations to ensure uninterrupted equipmen.*_
~ operaLion
Start-up and ad,justment work (PNR) can be done by individual production tech-
nical lines, by departments or sectors with a final technological cycle.
Start-up and ad~ustment are done both in building new production and when
renovating existing production. SCart-up and adjuatment work ends with re-
~ lease of the facility for industrlal operation based on a document from a
State Acceptance Commission.
The task of reaching planned power can be partialLy reaolved for individual
types of equipment or at individual technological stages, and certain eco-
nomic indicators such as expenditure norms for raw material and energy and
for labor intensiveness can also be reached while production is still being
started up and ad~ usted.
Production fa~ilities are accepted for operation only on the condition that
they are ready for release to the customer, that ie, steady relea8e of the
output anticipaCed in the plan has been aet up on the equ~pment insCalled.
In this regard, a facility for which the entire co~nplex of anticipated work
- has been carried out and release of the basic output has begun is considered
ready to begin operation. Installation defects and equipment bugs revealed
as a result of the comprehensive teating must be eliminated.
If several types of output are to be produced on the same equipment using
combined flow charts, comprehensive testing can be done ~ust for the release
of any one product. For production consisting of several parallel, identical
flow charts, testing production using one flow chart in working media is per-
mitted. All other systems are tested in inert media.
- As was noted above, start-up and ad~ustment work is 'the final link in the
process of creating a new facility.
From the moment the facility is released for industrial operation, it is the
period of production utilization, which is now the atart of enterpr~ise op-
erations.
In this period, a plan is approved for the enterprise, which must begin pro-
ducing output steadily in a volume and of a quality conforming to the plan
and must achieve the level of technical and economic indicators anticipated
by the plan. The utilization period includes technical, production and eco-
nomic utilization stages. The overall utilization period ends when the en-
terprise reaches the planned economic level.
A summary indicator describing the economic level of a n~w enterprise can be
set as a percentage of a standard, which could be the plan or indicatora from
the be~t existing enterprise:
- 10
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- K1E~ + K2 w + K3Ee .
, 1 1
El K1 + K2 + K3 ~ )
where El is the economic level of the new enterprise; -
- K1 is the proportion of expenditures on raw and other materials and
energy in ove.rall expenditures to produce a particular product; -
Em is the economic-level of use of raw and other materials and en-
ergy;
K2 is the proportion of wages in overall pioduction expenditures;
EW is the economic level of worker use; `
K3 is the proportion of depreciation in overall production expendi-
tures;
Ee is the economic level of equipment use. ~
Consequently, the time from the day the document accepting the facility for
operation is signed until the facility reaches steady release of output in
the volume and with the economic indicators conforming to the plan should be
considered the normal duration of enterprise economic iitilization. In this
regard, the duration of steady output is determined by the SNiP and the pro- -
- duction cycle; it is one month in branches with a short prnduction cycle.
- Sometimes the utilization period is delineated by two dates:2 the period is
said to start when the facility is started up f~r temporary operation, and
the end of the period is said to be the start-up of the i~.cility for contin-
_ uous operation. At the same time, this interpretation refers not to the
utilization process, but ~o the start-up period, as the utilization process ~
begins only when the facility is released for industrial operation, when the
_ enterprise is set a plan assignment for output release.
In spite of the fact that the normative period for utilizing new enterprises
is less than two years, in practice, the period needed to reach technical
and economic parameters stretches out to 5-7 yeara. The utilization of de-
signed capacity in terms of production volume and the attainment of other
_ technical and economic indicators often do not coincide. Thus, according
1. V. S. Saminskiy, "Ekonomika khimicheskoy promyshlennosti" [Economics of
the Chemical Industry], Moscow, Izd-vo Vysshaya Shkola, 1969, pp 333-334.
2. R. M. Merkin and G. V. Nikolayeva, "Methods of Setting Norms for and
Planning the Economic Utilization of New Enterprises," in "Sb. nauchnoy
informatsii 20. Metody i praktika opredeleniya effektivnosti kapital'-
nykh vlozheniy i novoy tekhniki" [Scientific Information Handbook No 20.
Methods and Practice of Determining the Effectiveness of Capital Invest- -
ments and New Equipment], Moscow, Izd-vo Nauka, 1972, p 47.
l.l
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to USSR Central Statistical Administration data, output net cost corresponds _
to the planned level at only nine of every 50 new chemical enterprises.
In some instances, this is to be explained by errors in calculations of in-
dicators at the planning stage. It sometimes happens because of planning -
confusion at the new enterprises: setting unsubstantiated plan assignments
or a lack of coordination among the varlous planning indicators. At the
same time, it is hard to count on the planned technical and economic indi-
cators to serve as a xeali~tic basis for pl.anning 10-12 years after they
were calculated. That is approximately how much time passes from plan ap-
- proval to the start-up of a new facility for indus~rial operation.
The reasons for slow utilization generr~lly emerge long before the start of
enterprise operations, that is, at the planning and construction stage. Fu-
ture enterprise production activity depends on the extent to which defects
in plans, equipment and installation are revealed and eliminated, on how
well techuological conditions a_re set up.
In terms of time involved and expend3.tures, start-up and adjustment for chem-
ical production facilities in a number of foreign countries are capital con- ~
struction. This testifies to the fact that the companies are guaranteeing
that all the indicators anticipated in the plan will be reached immediately '
after the facility is released for operation. ~
Installation and ad;justment are a single, continuous process without whose
final completion industrial operation of new capacities is impossible.
According to ttie SNiP, "completed pr~duction facility construction pro~ects
are accepted for operation by the State Acceptance Commission only if the
release of output anticipated by the plan has begun on the equipment instal-
led and the facility is ready fc~r operation."
The construction normslanticipate a time for starting up production, but in
practice, no time remains for equipment ~es~ting after the builders finish
the installation work, so it is handed over to the customer. What happens is,
construction is complete, but the facility is not ready to be put into oper-
ation. In this connection, V. P. Krasovskiy notes quite correctly that,
_ "given the availability of highly skilled operating personnel, the utili-
zation period could be eliminated entirely if the builders and installers 2
would release to them output ready for operation at full planned capacity."
' 2. R~sponsibility of Those Participating in Creating New Capacities
The creation of new capacities signifies technical actualization of scien-
tific and engineering schemes which are a result of the ~oint activity of
1. "SNiP III-A.33-66," paragraphs 2 and 5.
2. KOMMUNIST, No 12, 1975, p 47.
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the collectives of planning, construction-installation, start-up and ad-
~ustment organizations and the personnel of the new productian facility it-
self .
Various organizations bearing a certain responsibility for the work they are
doing are involved in all stages of creating new production.
According to the 28 May 1969 CPSU Central Committee and USSR Council of Min-
isters Decree "On Improving Estimate Planning," planning organizations are
~ obligated to organize planning on the basis of maximum consideration of the _
latest achievements of science and engineering in order that enterprises be-
" ing built or renovated will be technically advanced at the time they are put
inro operation and have high indicators in terms of labor productivity, pro-
duction net cost and output quality.
- Planning organizations consequently are responsible for the correctness of
plann:tng resolutions, planned installed capacity, and technical-economic in-
dicators. The general planner exercises autliorship supervision of observ-
ance of plan assignments and blueprints. For the most important planning
pro~ects, authorship supervision is also exercised after the enterprise be-
gins operating, until the facility reaches planned capacity. Planning or-
ganization reprQSentatives participate in ar_cepting a facility for opera-
~ tion and offer consultation on problems requiring refinement, on changes
and corrections during start-up and utilization.
Subcontractor construction and installation organizations are responsible
for performing construction and installation work in the least amount of
time and in accordance with the plan and for ensuring suitable quality.
The general contractor and his subcontracting organizations install and
test equipment following the requirements of part III of the SNiP and the
technical requirements and conditions agreed to by the planning organiza-
tions and the plants manufacturing the equipment.
The manufacturers of special or unique equipment are responsible for ad-
justing technological processes. Equipment suppliers oversee the installa-
tion (installation supervision) or entrust it to specialized organizations,
based en agreements drawn up.
After installed equipment is released to the enterprise, construction-instal-
lation organizations are obligated to conduct individu~l testing to eliminate
installation bugs and defects which have been discovered. Then a document
is drawn up transferring the equipment from the general contractor to the
customer, the enterprise.
The enterprise is responsible for prompt preparation of the facility to pro-
duce output at the capacities being put into operation, for staffing, for
supplying raw and other materials, tools and energy resources, for start-up
and ad~ustment work.
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_ ~
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Jointly with planning, contractor, construction-installation, start-up and
ad~ustment organizations and, when necessary, piants manufactur.ing special -
or unique equipment, the enterprise is responsible fos putting facilities
into operation and utilizing planned capacities within the time periods an-
ticipated in the norms currently in effect.
These are the requirements and obligationa s~ipulated in the instructiotts
for organizations participating in the creation of new production. Unfor-
tunately, planning and construction organizations and ma~chine builders sup-
plying equipment do not guarantee the release of output or the reaching of
planned technical and economic indicators at new facilities. This appre-
ciably reduces their responsibility for the indicators outlined.
Under the established rules, after the general contractor hands over to the
customer installed and individually tested equipment, the customer must do
the start-up and ad~ustment work on the technological equipment, including
comprehensive testing of the entire production flow chart, to ready the fa-
cility for release to begin operating. In order to do this work, he calls
in special.ized start-up and ad~ustment organizations, and representatives of
planning and contractor construction-installation organizations also parti-
cipate.
In accordance with the normatives, the schedules and procedures for the
start-up and ad~ustment work and a list of persons responsible for carrying
it out are established by order of the enterprise director for each produc-
tion facility. Based on that order, operational techn~cal supervision of
start-up and ad~ustment work is entrusted to a specialized start-up and ad-
~ustment organization, but the overall'administrative supervision of the
work remains the task of the chief engineer of the new or renovated enter-
prise. One example of the participation of different organizations in .
starting up a production facility is represented in the diagram in Figure 2.
Figure 2. Participation of Organizations in Creating New Production
( i nocmaNa~arNUe cM cccv .
~ 2 ~ '~ldC.7IG~/M� ~ ~ ~ '
ulut n t[7~ up.~l1!/U ~ 3 MONlAQ1K
~4~ BHf1HtuMp!�r 5 lunp0.iu 6 anzapcKUri aHr.a Noe ~(7)
mu~oeocaQa ~uc pea,rmu � aa6od cmpau~nanoe
me~r4ewecm0 OoD ~ruMpeaKmuBo6 ynpaQa~NUe
~
~
npoMC~,pori rnpotc3� ~ \ 1 eKmpo-
n crKm mo~n OM ~ Mo,,,ha~r�
/ ~ -
~ 1 M~p~�cc~mc~u�~
o- ~ renn
0ee~xmPe- 1.~u
Honma~+ J~uJa�AAUUa (14 )
(15 slC~'0�N[1pQ OVMb/~ n enua,opr.~u
[Key on following page]
11~
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Key (to Figure 2, preceding page):
1. USSR Council of Ministers decree
2. [illegible] of existing enterpris~s
3. "Khimmontazh"
4. All-Union Scientific Research Institute of Very Pure Chemical Rea-
gents
5. Giprokhimreaktivov
b. Angara Chemical Reagents Plant
7. Angara Construction Administration
8. Promstroyproyekt
9. Giprogaztopprom
10. "Elektromontazh"
11. Proyektstal'konstruktsiya
12. Teploelektroproyekt
13. "Liftmontazh"
14. "Teploizolyatsiya"
15. "Orgkhim" Start-Up and Adjustment Administration
The interaction between enterprise production-operations personnel partici-
pating in the start-up of production and specialists of the start-up and ad-
- ~:;stu�r� orgar~ization involved are stipulated in the "Staff Workplace Sub-
stitution Record," which outlines for the start-up period a precise distri-
bution of specialists by specific workplace and distributes the functions
and duties anticipated in the production instructions, regardless of what
organization a given worker is a part of.
According to the "Staff Workplace Substitution Record" drawn up by the leader
of the start-up and adjustment subunit and approved by the enterprise direc-
tor, all work in the start-up peric:d is done following the following scheme:
Overall technical and administrative supervision of work at a new pro-
~ect being put into operation during the start-up period Chief Engineer
of the enterprise;
Immediate supervision of start-up work a technical start-up leader
designated by the enterprise;
Operational supervision of all production-process operations Senior
Shift Chief;
The work itself Senior Instrument Control Man, Senior Machine Opera-
_ tor, Senior Laboratory Worker, instrument control man, machine operator, la-
- boratory worker;
Operational supervision of all shop, department and sector operations
shop, department or sector shift chief.
The above scheme anticipates that instructions will emanate from above and
that permission for operations will be received from below under a strict
procedure. The start-up technical supervisor, in order to ensure unity and
precision of leadership, does not have the right to give operational instruc-
tions to a shop shift chief, who in turn is obligated to coordinate all his
own actions with the senior production shift chief. Only the shift chief
issues instructions to specific individuals at the workplace.
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Production lesders are obligated to enaure normal operation in the sectors
subordinate to them during the start-up period supplying raw material
and power, sending on finished output, stopping and starting up equipment.
When the start-up of several shops is done on a one-time basis, shift chiefs
- must coordinate the start-up sequence in each shop. In this instance, over-
all supervision of the start-up ia done by the senior shift chief through
the appropriate shift chiefs. A working commisaion is created to prepare
the faci'.ity for release to the customer for operations. It is designated
- well in advance of acceptance of the facility for operation, at a time which
depends on the nature and complexity of the production.
After the individual testing done by the installation organization is com-
plete, the equipment is accepted by the working commission fur comprehensive
testing. The working commission is created by the customer no later than
five days after it has been informed that the equipment is ready for com-
prehensive testing. Subcommissions can be created for each individual shop
or installation comprising an industrial complex. The working commission
inclsde~:
a representative of the directorate of the enterprise being built or re-
novated; that representative is the commission chairman;
specialists from among enterprise ':.ndustrial-production personnel: the
chief engineer, the chief inechanic, the chief power engineer, the shop chief
and the equipment safety engineer;
representatives of the planning organization, the general contractor and
s subcontractor organizations;
representatives of organizations involved in the start-up and ad~ustment
work;
- representatives of the trade union council's technical inspectorate and
the eneerprise trade union organization.
The working commission is obligated to check:
conformity of the construction-installation work done to the approved
plan; ,
individual components, subassemblies and equipment;
installation quality;
the provision of the start-up complex with material resources and per-
sonnel.
After comprehensive equipment testing and the enrire complex of start-up and
ad~ustment work are complete, the working co~cmission checks work quality, de-
. cides the readiness of the ec~uipment for acceptance for operation, and sub-
mits the facility to a State Acceptance Commission.
The State Acceptance Cou?mission accepts capacities for operation after fi-
nal installation of all equipment and completion of start-up and ad~ustment
work. Individual auxiliary installations of the system which comprise the
start-up complex but which do not participate directly in producing the out-
put anticipated by the plan (such as power pla~ts and pump stations, com-
pressors, warehouses, maintenance shops, access roads, and so on) are ac-
cepted for operation nn the basis of their readiness by working commissions
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prior to acceptance of the facility as a whole by the State Acceptance Com-
mission. The date the document releasing facilities for operation is signed
by the working commission is conaidered the date the individual auxiliary
installations begin operation.
The State Acceptance Commission is designated by a sup~rior organization no
later than three months prior te the established start-up of the facility
for operation to accept production fac~lities or start-up complexes:
by a ministry when the estimated cosi of the facilities is 2.5 million
- rubles or more;
by a ministry all-union association when the estimated cost of facili-
ties subordinate to them is 500,000 to 2.5 million rubles;
by the enterprise director when the estimated cost of the facility is
under 500,000 rubles.
Participating in the State Acceptance Commission are a representative of the
ministry (chairman), representatives of the directorate of the new enter-
prise, the general contractor, the general planner, the bank financing the
_ pro~ect, and the State Construction Architectural Control agency.
The production facility is submitted for acceptance for continuous operation
by the working commission to the state commission in accordance with the
"Rules for Accepting Completely Built Enterprises, Facilities, Shops and
Production of the USSR Chemical Industry for Operation" and SNiP (10)-(III-
66) only after it has been brought up to steady operating conditions..
The State Acceptance Commission checks the conformity of start-up complex
capacities to planned and actual construction cost and the approved esti-
_ mate; it evaluates the new facility in terms of progressiveness of techno-
logical production processes and makes suggestions on improving the opera-
ting qualities of the equipment installed and on increasing production pro-
fitability. Changes in production capacities which were anticipated by the
plan and in other technical and economic indicators are generally not per-
mitted in accepting a production facility for operation. They can be in-
troduced into the plan in exceptional cases, as for example, accepting a
- facility for operation using a temporary or abbreviated flow chart, with
the permission of a superior organization and with the concurrence of the
USSR Gosplan and Gosstroy. The date the document is signed by the State
Acceptance Co~nission is considered the date the start-up period ends and
the facility begins continuous industrial operation. A diagram of accept-
ance of a facility for operation is given in Figure 3[following page].
= Thus, the start-up period begins after construction-installation work is
complete and ends with release of the facility for continuous industrial
operation, when a plan is set the enterprise in accordance with the ac-
cepted capacity.
The "fixation points" of the start of the start-up period are the date the
working commission signs the document releasing the facility to the customer
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and the end of the start-up period is the date the State Acceptance Commis-
sion signe the document putting the capacities into operation.
Figure 3. Diagram of Acceptance of a Start-Up Complex for Operation
G~CUUuaeNat- 04cma, npedukcm-
/2 Anm P tOmc'd~+o~r,u uA~,~y ~ybruvP urhu~'My MONAlOIM/ QM/D 0 Opll~AMf AN:'O~e~fM~~6'1 ~ 3~
l ~ il,':`:ea~a � f"�'~; ~lJ:'~'~u;l.r . . ror!ont
- - ~r,:!�,MC'~rr 0~ ~
lJr:I,C~A~a'~l~ ~ CG~' 'N(/N C9C~IQeARN11pf
i Mo~m~~v~caOpt~M2lvyua r ! M(lJJ(lUD rne~boa'ume
_ ! wtr~ud70p lu~OdQ /l uKa~ o caldatiuu ~roMuccuu r~u~oe3op.m~dn
1 r~/'unul~ruan9,rf~i74~'mYl.r wDwmO.wnpAO QnuJSUUa
L'__ uiA Dd,"rJenua vroe�mvnud
dai,ycK~emrA cudvermnn ~
( 6 Ou !~mapOM JOQ~l~O( rpa'vuMdw
(5 )~~y ~AO~~pP UC/1DlIIlOMJC 1. z~e~cnenau na~~uno,u N~uaudyona.ye~eurne~maHUa (7 )
~OoPy~~i'�uo no ~OnofmOu CMwOCmtti u onnopcmo4 MQ '
~~dy ( 9 NNdu o/laNmP utnar+n~ye nnmm~ptmo u n nOrmo
O d~'n 0 pPJy~/asrampr ufna� ~_~M!!a ~kJd NdtQyJA'OU Arm 0payn~crnmar arn~�
~ p ~ r mGNU:! mQnu(/
~o~mc3/~AIQIl1' mpaMeMVe dt~ne~m,~9~wmD~rra tormo na.am: ~ ~8~
I NO/~'mO.YHQO G{~IQNflJQ~l1/O J. MOH/I1pN/N('ADOIONflJ(1!1!!R
1 m!,nadlOp.~k'~OiJORO~flMl ~ npy~a~. r.nr.No,~~c ~JOcdo(x~nvvuMU~
OCc2AdOMUU OQO~'P(/ KOM(ICCYtl
� anycRO4mCR~
df! CM/A0~lOMJO:WJC~jONQ~VUA'OM �
(12 . ' ,
~ryaemuma.~ urnarmoauu
CuCmO n~em�
~
o~vu~u~~1 ~llIJnllc~nHO~
rlQermp
J~/.W OUtH'n0~~naMO 7~JYUAOM
A~ ~n npucMrrr c~y m+ua Axm npurM,ru ~~anQdnvNau
13 G nano~�y ~ yt~n ,,dnc~ uvno,e po Oma u npo 6um (14 ~
~ ) Oepn~eaeucnermaMuaabupyJoduM~-
cac~~:~Gi,wAin� carma~am:
~ npt9cm.a0u~nene ~nEodo 16 _ t nOeDcnwdcn+enr nan4dovNO~
t.np~dtm,vdrmeaennnadow y[m ONe�ue dt~en'm00 dOnodKU dpanurokau
nuu C tanc�JJUtIU n m~ImtA J
Onp~~q[Na~
t~m1I~0 O~NU~ K A'OMl1pEA'LNOM l1 M(!q
_.t__-
~ a n~~UDnb~J ~yCK OGODyd0~0/~UF NO /OAOCl110MXOBy
~ i%~^~J~io~u nytK abnpyda."anua nod ~at y~~rou
� (1 KmramoDHvcmrn6gvydod~�
(19 KaMnntKCnot onp~6n~onut oecps~doAaMUU Hu,~K~aMn~r~rcna~+y onpo-
~ a u~pnEa HUE HO IOAJCmOM XOdy ~`�e�NUM
6 CnpOd9dunuP n0~ nOt,7 1nOti tOtmoOnatmcA
__-._Y c~F'J KOM'uCCUClI
~GZ ~ '?.q! Qf!e+ru~
e~mo 4fON1l10AY9~NQ,90. U
20 C9~6arenu~ o~ar~aG.~acmu .23 i~ uKo,tunasnaveNuu tur d~ cm� muranoEnx~~+uodeemodna 21
~ c`J.e~r.~ox~rir.n-u~nnuu ~Mxinpur�ra~nnu Kp,r,d~c~ tdavlneNU4rarnnMUCCUU ~ ~
' ~u~c~+uua ,IaJ~dn MuNUCne,~rmd~M rotmosamnu~
1 ttMaCdpo~vu~r o0ovtrt KmuvrCUtd
ruMU~~rnOU n~O.N~utnennOf/u
~ 24 ~ npu~~,Ko rary'3SQG!lpPMnDli /!pr(F.MOVR01l
RoMU:~curu nyr~rPCnro.tc~rnnex~0 a
2 _ 1,rcnAyomcuc k
e+nyr~rto~NOtinpo
ne~moa~dsc.rom~t~wori q,~mnpur,wKao~etKmv
,CarnaJ~aA ~~,wc~ra 6 ~+rn u
2s )
, ( 27 ccrmc nAem.~
n,crueBomtne ~aryc'~c~k,r peweNUr M,~n oQ~TEepard~HUU ~ay0~rarM~~,rxav~vavHao
Mar~punvovNpri,+s~vu uu a,rma mai ewdu~u~umr ~rohaaup
(28)
[key on page following]
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Key (to Figure 3, preceding page):
1. Special work preceding general installation
2. Document of equipment readiness for apecial work, drawn up by (1) ~
installation organization, (2) plant technical supervisor's of-
fice, (3) special work organization
3. Document accepting work done, drawn up by (1) special work organi-
zation, (2) plant technical supervisor's office, (3) installation
" organization
4. Equipment installation
5. Testing individual equipment at idle
6. Test results document, drawn up by (1) ins~allation organization, (2)
plant technical supervisor's office (customer)
7. Individual testing of tan;cs and apparatus for tightness and soundness ~
8. Order creating test acceptance commission, issued jointly by (1) the
plant director (customer), (2) the general contractor
9. Testing individual equipment at load
10. Eliminating installation defects
11. Order creating the working com~ission, issued by the plant director
(customer)
12. Test results document, drawn up by a commission designated by the
plant director and the basic contractor
13. Document accepting equipment for ad~ustmer~t, drawn up by (1) plant
representative, (2) adjustment organization representative
14. Document accepting ad3ustment work, drawn up by by (1) ad3ustment
organization representative, (2) plant representative
15. Start-up and adjustment work and check tests of equipment
16. Eliminating ad~ustment defects
17. Determining equipment readiness for comprehensive testing; (a) first
start-up of equipment at idle, (b) first start-up of equipment at
load
- 18. Document of equipment readirtess for comprehensive testing, drawn up
by the working commission
19. Comprehensive equipment testing, (a) testing at idle; (b) testing
at load
20. Report that the facility is ready for operation, (1) plant director-
ate, (2) general contractor
21. Document of facility readiness for submission to a state commission,
drawn up by the working commission
22. Eliminating installation and ad~ustment defects
23. Order designating the State Acceptance Co~ission, by the Ministry
of Chemical Industry
24. State Acceptance Commission acceptance of the start-up complex for
operation
25. Document accepting the facility for operation, drawn up by the State
Acceptance Cormnission
26. Release of finished output as anticipated by the plan
27. Report of the State Acceptance Commission chairman
28. Ministry of Chemical Industry decision to approve the document of
the State Acceptance Co~ission
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Under the provisions in effect, the enterprise at which the pr~duction is -
being introduced is responsible for starting up newly created production.
The enterp~.:ise accepts capacities ready for operation from the builders.
In order to increase the responsibility of the builders for the work done
by them, we think a facility should be transferred to the customer not af-
ter the installation work is complete, but only after the complex of start-
up period work has been done. Were this the case, a construction organiza-
tion would act as a general contractor, involving specialized organizations
in performing the start-up and adjustment work and guaranteeing the release
of capacities ready for operation.
3. Start-Up Facility
We should make clear what we mean by start-up facility. A number of con-
cepts, such as construction site, start-up complex and constructian pro3ect,
are used in planning practice and construction.l
The start-up complex is an aggregate of facilities (or portions thereof) of
basic, production and auxiliary designation, of power, transport and ware-
housing systems, communications, utilities, purification facilities and pub-
lic amenities whieh ensure the release of output as anticipated by the plan
for a given start-up complex and ensuring normal working conditions for ser-
vicing personnel in accordance with current norms.
There can be several complexes at one construction site, each of which is an
independent facility.
The aggregate of buildings and installations whose construction, expansion
or renovation is, as a rule, carried out in accordance with one set of es-
timate planning documentation is called a construction site.
A construction pro~ect is each separate building or installation, with all
the equipment, subsidiary and auxiliary structures and supply lines related
to it as anticipated by the plan. One shop or several shops can be construc-
tion pro~ects.
An enterprise is often put into operation not as a whole, but gradually, by
start-up line, each of which can include individual production facilities,
shops or shop sections. The sectional start-up of individual types of equip-
ment is economically advantageous, since it permits working out start-up ac-
ceptance and utilization for a small number of units and sharply reduces the
time and expense invflZved in mastering subsequent sections.
1. The definitions following are given in "Metodicheskikh ukazaniyakh k raz-
rabotke Gosudarstvennykh planov razvitiya narodnogo khozyaystvo SSSR"
[Methods Instructions for Working Out State Plans for Development of the
USSR National Economy], Moscow, Izd-vo Ekonomika, 1974, pp 281-282.
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Star~c-up by shop is possible where each shop has a finished production cycle.
A ma~ority of the enterprises of chemical industry and branches related to ~
it are ptit into operation by production facility producing a certain type of
finished product.
A production facility is accepted for operation only if release of the out-
~ut anticipated by the plan has begun on the technological equipment instal-
led.
In any start-up method, the appropriate start-up complex composition, the
aggregate of basic and auxiliary production facilities, must be ensured.
Start-up completeness is achieved not only given a certain production compo-
sition, but also given a certain sequence of start-up of individual shops or
portions of shops in each start-up line. In those instances when a facility
consisting of a number of independent flow charts is released for operation,
they can be accepted for operation as they become ready, on the condition
that productfon is operating normally and that purification facilities and
utilities are ready and all labor-protection and equipment-safety norms are
being followed.
When enterprises are installed by start-up line, more funds are usually spent
to create auxiliary-system reserves when building the first lines and putting -
them into operation. Construction of the second and subsequent Iinea is less
expensive (approximately 75-80 percent of the cap~Ctal investments antici-
pated).
Usually, the first line is released for operation, the enterprise becomes an
operating concern, it does its basic activity, and at the same time capital
construction continues. Given such construction practices, it is sufficient
to invest 20-25 percent of the average estimated cost for the enterprise to
begin producing output. This method speeds up the process of utilizing new
capacities. It is therefore a mistake to view production start-up and util-
ization schedules apart from the conditions under whi.ch facilities are being
created.
The gap between times of release of indivi8ual lines is sometimes very large,
which makes it hard to evaluate the enterprise as a new entity. In view of
the large gap in times of release of facilities, we should speak not of "new
production" but, as Z. P. Korovina recommends, of "a newly operating facil-
ity."
Calendar time since the start-up of a facil~.ty alone is inadequate to define
the concept of "new production." Consideration should be given to the new-
ness of the output and the level of the equipment being introduced.
Production based on the following should be considered new:
manufacturing output not previously produced by that enterprise;
using technological processes which substantially alter output manufac-
turing technology;
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use of equipment which substantially alters enterprise technical and
economic indicators;
new production organization.
At present, we are usin~ a new-output gradation which corresponds to the es-
sence of the process c,f up-dating and developing production. It consists
of dividing enterprise output into:
1) own new output having no analogs, output being manufactured for the
first time in the USSR;
2) new output having prototypea, but substantially different from them;
3) output improved in part, with retention of basic characteristics.
Renovated enterprises can also be newly operating facilities. According to
the "Methods Instructions for Developing State Plans for USSR National Eco-
nomic Development," renovation and expanaion include the construction of new
and expansion or reorganization of existing shops and installations at ex-
isting enterprises whi.:h is done following a single plan or plans and esti-
mated for individual f4cilities, as well as the continuation of construction
of a new enterprise based on a plan which has been changed since capacities
ensuring the release of basic finished product were put into operation.
Renovated production ordinarily includes that in which the coefficient of
fixed assets renewal as a result of capital expenditures made is 0.4 to 0.6.
Expansion includes the construction of second linea or new shops on the site
of an existing enterprise, as well as the start-up of units in order to re-
lease additional output in short supply. Production renovation, along with
new construction, is one method of increasing capacities. It generally per-
mits ensuring output increment more quickly with proportionately fewer ca-
pital investments. However, if a significant portion of the renovation aZ-
locations goes not to up-date equipment but to radically restructure produc-
tion buildings, the subsidiary and warehousing system, a high proportion of
construction-installation work in renovation expenditures reduces its eco-
nomic effectiveness. For the chemical industry as a whole, the intensive-
ness of renovation and expansion of existing enterprises is higher than the
construction of new ones, as is borne out by the coefficient of capacities _
start-up, which describes the ratio of cost of fixed assets introduced to
� volume of capital expenditures._
Thus, the coefficient of capacities start-up in chemical industry in 1961-
1965 was 0.9 for renovated and expanded enterprises and 0.55 for new enter-
prises; in 1966-1970, the figures were 0.97 and 0.87, respectively.
In accord with the definitions given, a facility sub~ect to start-up is un-
derstood to mean new or renovated production which can be an entire indus-
trial complex, enterprise, indtvidual enterprise lines, or a shop with a
finished production cycle.
Section 2. Specialized Start-Up and Ad~ustment Organizations.
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The considerable capital investments being directed int o developing indus-
try and increasing the number of facilities being put into operation, on the
one hand, and technical progress in industry leading to increased unit capa-
city and process speeds, to increasing complexity of flow charts and a ris-
ing level of production process mechanization and automation, on the other,
neceasltate involving new, specialized atart-up and ad~ ustment organizations
in starting up and ad~usting new production.
The creation of start-up and ad~ustment organizations was outlined by the
11 January 1963 CPSU Central Committee and USSR Council of Ministers Decree
"On Increasing the Role of the State Committees and The ir Responsibility for
Deve~oping Branches of Industry."
Positive experience in starting up and ad~usting techno logical installations
of petrochemical and oil refining industry, which the "Orgneftezavody" of-
fice has been invulved in since 1952, has been the basis for creating atart-
~ up and ad~ustment organizations in all branches of industry.
The involvement of specialized organizations using more xmproved methods of ~
doing start-up and adjustmenfi work. These organizations are staffed by
skilled ad~usters (engineers, technicians).
A three-link management system is characteristic of a m3~ority of the start-
up and adjustment organizations; a lead start-up and ad~ustment organizat�lon
(trust, off ice, association) subordinate direcCly to a ministry or depart-
ment is the basic economic link. Included in the lead start-up and ad~ust-
ment organization are start-up and ad~ustment adminisCrations, which in turn
include sectars, groups and brigades, that is, individual production sub-
units directly involved in start-up and ad~ustment work at the facilities.
The start-up and adjustment organizations are primarily enterprises of the
given branch and are called on to solve a whole complex of technical prob-
lems. They are fully specialized to perform start-up and adjustment work.
In the chemical industry, the State All-Union Engineerin g-Technological
'frust (Orgkhiml of the USSR Ministry of Chemical Indust ry, created in 1963,
is concerned with start-up and adjustment work at newly operating facili-
,ties and with rendering technical assistance to existin g enterprises.
Along with the Orgkhim, a number of planning organizati ons also participate
in the start-up of new chemical indu~*_xy production. Thus, since 1965, in
the Lenniigiprokhim, State Committee for Chemical Industry, attached to
rhe USSR Gosplan, t?as been entrusted with start-up and adjustment work for
the complex of planning developments done by thzm. In this connection, a
start-up and adjustment administration (UPNR) has been created under the
Lenniigiprokhim.
The Union "Orgnefte2avody" office is an organization wh~ch has accumulated
considerable experience both in starting up new petrochemical and oil
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refining enterprises and aupervieing and ad~uating operating procedures at
existing inatallationa with a view towards using them efficiently.
The All-Union "Orgbumdrev" asabciation, which operatea under the "Regula-
tions an Procedures for Performing..Start-Up and Ad~ustment Work by the All-
Union 'Orgbumdrev' Aasociation at Enterprises of the Minietry of Pulp and
Paper Induatry," starta up enterprises of the lumber, pulp-paper and wood-
processing industries.
Along with the indicated specialized organizatione, the USSR Ministry of
Installation and Special Conatruction Work has trusts designed to ad~ust
and start-up new production capacities.
There is also a broadly specialized type of organization which has no par-
ticular specialty and which performs several types of work on a facility,
such as installation and repair and the associated start-up and ad~uatment.
Machine building has no specialized start-up and ad~ustment organizations
starting up production facilixies as a whole. However, the design bureaus
and plants assigned to them participate in starting up equipment designed
and manufacCured by them in industrial operation on a lead-prototype basis
by exercising authorship supervision of their development. Thus, for ex-
ample, experimental plants of a number of ministries are permitted to in-
clude in the cost of the equipment manufactured by them expenditures on its
start-up and adjustment, which comprise 20-25 percent of total expenditures
on the equipment.
The technological planning institutes and technological-design bureaus ren-
der enterprises technical assistance in utili2ing planned capacities when
introducing new technological procedures, processes and equipment. Thus,
for example, a department concerned with starting up and ad~usting new de-
velopments has been created within the Central Technological Design Bureau
of the Latvian SSR Ministry of Building Materials Induatry. Introduction -
work comprises 10-20 percent of the total cost of a development.
The experience of the All-Union Technola.gical Planning Institute of Foundry
Industry (VPTIlitprom) is very interesting. The VPTIlitprom plans start-up
and adjustment work, superviees observance of the plan, treats start-up and
ad~ustment work in progress, consults, and provides additional instruction
to servicing personnel at the workplace.
These plans anticipate:
the participation of planning and design organizations, equipment manu- -
facturing plants and construction-installation organizations in start-up and
ad~ustment work;
the responsibilities and interaction of ttie organizations and the extent
and nature of their participation;
the system of organizing equipment start-up and adjustment and of intro-
duci.ng technological processes at all stages of the technological process;
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the procedure for calculating start-up and ad~ustment expenditures and
for drawing up documentation for thia work.
At the plan development stage, the VPTIlitprom draws up a loose financial ~
estimate for the start-up and adjuatment work, which outlines a plan for
organizing the work on putting the enterprise into operation; this com-
prises in cost terms approximately one percent of total estimate expendi-
tures. The leader of the comprehensive start-up and ad3ustment brigade
creai~d from among institute specialists is the authorized representative
for the production start-up period.
The basic task set by the institute ia develop:tng plans for organizing
start-up and ad3ustment work at enterprises of the foundry industry is to
meet conditions for reducing to a minimum the time involved in putting the
facility into operation.
This experience has unfortunately not found the proper support and dissemi-
nation, which is connected in conaiderable measure with ehortcomings in fi-
nancing and determining expenditures on start-up and ad~ustment ~ork.
The literature has a number of recommendations on improving work organiza-
tion in the start-up period. Thus, Z. P. Korovinal thinks it necessary to
draw up an organizational plan (a plan for organizing the preparation,
start-up and utilization of planned capacities) in the facility planning
stage. It is the author's opinion that this must be done by special plan-
ning institute departments comprised of skilled specialists with a great
deal of experience in organizing start-up.
The organizational plan must cover the time from the start of development
of the technical plan to reaching planned technical and economic indicators
and must contain these sections:
1) rnethods of putting the enterprise into operation;
2) organizing preparation of the enterprise for start-up;
3) content ~.nd duration of the start-up period;
4) organizing utilization of start-up lines.
_ Of interest in foreign publications are works in which it is recommended,
for prompt and proper start-up, that a program for implementing the start-
up be developed in advance and include st2.ff, organizational measures, the
preparation of working instructions, completing construction work, and or-
ganizing initial adjustment operations when starting up new facilities.2
1. "Methods and Practice of Determining the Effectiveness of Capital In-
vestments and New Equipment," in "Sb. nauchnoy informatsii 20" [full
title in footnote 2, p 12], Moscow, Izd-vo Nauka, 1972, p 60.
2. E. Troyan, "How to Prepare the Starting of Chemical Industry," in CHEM-
ICAL ENGINEERING, 67, N 18, 1960.
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Along with the large specialized start-up and ad~ustment organizations serv-
ing entire branches, several start-up and ad~ustment organizations belong-
ing to various departments also often do start-up and ad~uatment work at
large construction sites. For example, simultaneously with Orgkhim produc-
tion administrationa, the Belpromdaladka Truat, Khimrematroymontash Trust,
Sevzapmontazhavtomatika Trust and others did start-up and ad~usCment work
- on the Gronenskiy Chemical Combine.
The fact that there are a large number of small, departmental organizations
is un~ustified in a majority of cases. Tl:ese organizations are poorly pro-
vided with equipment, have poorly skil.led workers, and generally their ser-
vices are high in cost. It has been estimated that the unification and con-
solidation of such organiz~tions in the Belorussian SSR alone would enable
us to save a million rubles per year and to simplify the administrative ap-
paratus by 300 persons.
The involvement of several similarly specialized organizations in sCarting
up a facility testifies to a lack of precise centralized planning. At the
same time, the plans for utilizing capital investments and putting new pro-
duction capacities into operation muat be coordinated with the need for the
services of specialized start-up and ad~ustment organizations. In drawing
up such plans, capital construction plane are used as the base, wherein an
assignment for putting production capacities into operation is set for each
facility. '
Afraid of high start-up and ad~ustment expenditures if specialized organi-
zations are involved and of high net cost during the utilization of new pro-
duction, enterprises sometimes start up production using their own efforts.
This obviously lowers work quality, schedules for putting facilities into
operation are often not met, and the time involved in utilizing new produc-
tion increases. The Ministry of Chemical Industry obligates enterprises to
use the Orgkhim A11-Union Engineering-Technological Trust's technical assist-
ance in starting up new production and to submit applications at the proper
time for including them in the start-up and adjustment plan.
Orgkhim specialists are called on to do start-up and ad~ustment work at new,
expanded and renovated production facilities, on individual units and pieces
of complex technological equipment, technological installations, air condi-
tioning units, pneumat~c transport, ventilation systems, waste water purifi- _
cation facilities, check and test point systems, and automatic machines.
- Their participation in doing individual types of work is shown in Figure 4
[following page].
Such broad specialization in organizing the start-up of newly operating pro-
duction and of individual systems in it is reflected in how the structure
of production administrations is shaped.
The Orgkhim Trust consists of six branch (OPU) and four specialized (SPU)
production administrations. The branch administrations cover such branches
of chemical industry as nitrogen, chlorine, basic chemisCry, chemical fibers,
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Figure 4. Structure of Work Done by the Orgkhim, in percent
r t
9 . ~
4
e f
~ 6.
Key:
1. Adjusting the check and test point system and automatic machinery,
14.2 percent
2. Start-up preparation, start-up and utilization of production, 21.5
percent
3. Start-up of water circulation systems, 2.5 percent
4. One-time engineering services, 1.7 percent
5. Start-up of technological stages and individual units, 14.2 percent
6. Technical assistance to existing enterprises, 14.1 percent
7. Ad~usting ventilation systems, pneumatic transport and air condi-
tioning, 16.8 percent
8. Starting up boiler rooms, refrigeration and compressor stations, 9.6
percent
9. Starting up complex purification installations, 5.4 percent -
lacquers and dyes, plastics and their processing, paints and organic pro-
ducts, production of household chemicals and chemical reagents. The parti-
cipation of Orgkhim specialists in starting up new production in individual
branches of the chemical industry is shown in Figure 5.
Figure 5. Orgkhim Participation in Starting Up Facilities, By Branch of the
Chemical Industry, in percent [key on following page]
o~-s ~rpocu,nPne (1~l
(12 )
~
F /lnocm.~acc~ (1 ~ )
~~~~4 r a ?JOZ ~�~1)
(1 ' 9 .ru.~~~cnoKN 1~~~~
~U ( 2 )
~ ,~o
'~J~ rG's'>`::, ~iS~ 6,P~5 OcdoQ~~3~
F
~ 1 Q ~ OfHOL4/UUXUn!UU , i ~ ~4 ~
31,94 XnopNOU ~
6 ~n~
Me~m- ~ ~
A10,nHDU ~eyNO['mu ~ ~
~r
npoa~mruneNNOCmu
~9) ~ ~ ~Sr~
V ~
n~`O~,O
~8) `y~~"~(7) .
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Key (to Figure 5, preceding page):
- 1. Photographic chemicals 9. Nitrogen industry
- 2. Household chemicals 10. Basic chemistry
3. Reagents 11. Mining chemical industry
4. Horticulture 12. Aniline industry
5. Fiberglaes 13. Paints
6. Chlorine industry 14. Plastics
7. Inorganic chemicals 15. Chemical fibers
8. Organic synthesis
The specialized Orgkhim administrations are ~oncerned with preparing and
starting up check and test point systems and automatic machinery, ventila-
tion and air conditioning systems, gas and indusCria~ waste water purifica-
tion systems, at enterprises being put into operation. The Orgkhim struc-
. ture (Table 3) is one way of combining branch and territorial management of
start-up and adjustment work.
Table 3. Structure of Orgkhim Production Administrations, by amount of work
done and by number of personnel
iT(~~oH~uo2cruenu~c ynpaaneuN~ `Obbew w~6or n~K~tl~oAr~ ~a~~~~ o~
Uprxiu+a ~ y K tirory n�~ K uTOry PYG.�ven.
5 liu:i~nu;ixiuichuc T,5 fi,G 5089
6 J.l:~~~p~i Crb~ocrb 3Tand pa6or
u. n. 9renM paEor~ pYa� e~~' K o6ulc-
wy o6beMy
~ (4)
I!~ P~ccMOTpew~c npoetcT~tofi TexHi~- 2028 3,9
4CCKU1~ J~OKyMC1iT~l(NN
2 ~~Taf~3op sa aWnonuenNen+ cTpou� 47RG 9,1
TC.~},IIO�MOIIT~3KHtiX paGor N ax o~~c-
(~CJ~IfOCTB D COOTDC'TCTONN c npacu�
TU~I
~7` ~ ~
~
3 1�Inaccnepuwii hoiirponb npn nw� 1522 'l,9
uc~~ncinn~ Mt111T8)K~ OT/lCJIbHWX ~r-
~~cra�rou
~8~ �
A [3i.i~ionenuc nonon~rc~u~~~ K npo~ IG22 3~~
cK~y n npoucccc MouTahca
5 ~9QCMOT~ N Il(10RC(IKA o6opyA~na- 1873 3,G
ims~ c cocranneerie!~t Ae~exr~iWx -
ncn.on~ocTeFi
10
, 6 Pa:~pa6or?ca TCRIINVC'CKHX nnauon ~p(5 1~g
nycK~ i~ rp;i~Fn:oii nycKOnanano~i�
ui,ix paCoT .
T ~~Y~ ouo~tcroo paGoT~n~u rex~~ona 1135 2, ~
ru~i~�cKOro oGonynoua~rns~, rip~~aTy-
pia. :iauopni~x ycrpoi~cTa
(12)
8 fTouroroeKa iKChinyaTan~ionHOi1 4G55 g g
:tuxy\1CIIT81U111 ' ~
9 ~~TdnroronKa n o6y~ic~tHe sKCnny- 38)8 ~ g
~rauuonnoro IIC~)C011.1A~ '
(14)
n0!(fOTOBKB OGOpYA088NNA K CJ{8- IOB3 2~ (
ac ero I'oprocrexHa~3opy c o~op-
xncuNe~.~ coorBercruyrou~efi ,qotcy-
n+enrauui~
[Continued on following page]
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Table 15 (continued from preceding page)
11 ~ 1~ gnaop 3a onpeccuexo~i o6opyAO- I135 2,2
D21111fl FI NOMMyHHK8UN31 H P83p8-
~OTKB CXCM YCT8110BKN 38fJIyWCK
l2 ~1~A~cetiepNw~i uouTponi, np~i ?w� 3G02 6,9
u?iaru~yan~f~oM ?icnwrnii?ie oCopy-
~ouan~~st nxonocryto ,
, I:i ~1~dnroronKa o6opyAonet~F~si x ny� 6474 t2,4
cKy ua Na6ovHx cpcAax. Tlpo6ubiti
'nyci< o~uioi~ TexnonorH4ecKUi~ nur-
KH Il~)(1117ffORCTflU IlU HNCT(lyKIINN
I~I ~1E1~fnanKa TexHUnorH~iecKnro pc- 8245 15,7
>KIIN71 ~
15 ~'Orfpencncnuc ~~aKri~~iccKUA ~~ipa- 2879 5,5
i~anouc~rnciiuui~ Mouluocru
(20)
IG Pa~ipa6orxa Meponp?~eT?t~i N Bw- 392 0,7 _
. ((T4d pCKOMCHAa~1N~I IIO yllY'IW@HHIO
TCXI10.90CIt~ICCHOI'O peACNMB . �
~
21)
H T o r o nycKOtioi~ nepeoA t 9G 2G4 88,4
17 ~~~f3~18601'N8 TCXl11142CH011 naKY- 2028 3,9 -
MCIIT3QNN ,
(23~
IS OGecnc;4enue ui,~nona npoN3uu~t- 3042 5
- rrnu ua upocK�rt~ym MOIl41~OCTb n
Koi~rponi~ sa pi,tnonnen?irM u~,~nnii-
~eKOMei~n~ui+ii
19 }(a~~�sop 3a ~~GOTOFf OG7,CKT2 na l014 1,9
I1PUE'KT1I0~1 MOI1~f10CTN D COOTDCTCT-
uHU c uopa~an~ii ispen+eur~ uenpe~~i~n-
uoA paGo�rw
(25)
CTOt~n+ocr~, ecero xoMnneKCa �pa6or ~ 52 348 1~0
I
Key:
1. Number, in sequence
2. Stage
3. Work cost, in rubles
4. Work stage, in percent of total amount
5. Reviewing technical planning d~cumentation
6. Supervising construction-installation work and work sequence accord-
ing to the plan
7. Engineering supervision of installation of individual units
8. Revealing supplements to the plan during the installation process
[Key continued on following pageJ
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(Key to Table 15, continued from preceding page)
9. Inspecting and checking equipment, drawing up notices of defects -
10, Developing technical start-up plans and schedules for start-up and
ad~ustment work
11. Supervising operation of technological equipment, fittings and shut-
off installations
12. Preparing operations documentation
13, Training and preparing operating personnel
14, Preparing equipment for release to the Gc~rgostekhnadzor [not further
identifiedJ and drawing up the appropriate documentation
15, Supervision of equipment and utilities pressure testing and develop-
ment of seal plans
16, Engineering superyision during individual equipment t~sting at idle
17. Equipment preparation for operation in working media. test release
= of one technological thread in accordance with the instruction
18. Adjusting the technological conditions
19, Determining actual production capacity
20. Developing measures and issuing recommendat;ons on improving tech-
nological conditions
21, Total for start-up period
22, Development of technical documentation
23. Ensuring that production reaches planned capacity and monitoring
carrying out of recommendations made
24. Supervision of facility operation at planned capacity in accordance
with norms for continuous operation
25. Cost of entire work complex
The price list covers branches of the chemical industry. It determines the
cost of having a complex of start-up and ad~ustment work done by branch and
specialized production administrations of the Orgkhim (Table 16) [following
page~, The cost of work not indicated in the price list is taken for simi-
1ar production.
The price list anticipates that work will be done under the following con-
ditions :
a) technological equipment must be installed in accordance with the
plan and its condition must conform to the rules and norms of technical
operation;
b) the customer submits all the necessary materials, raw materials, en-
ergy resources in conformity in quantity and quality to the plan and also
allocates operating personnel.
The price list reflects only the cost of the technological portion of the
facility and does not anticipate payment for start-up and adjustment work
on ventilation systems, check and test points and automatic machinery, re-
frigeration units, electrical equipment or water purification facilities.
The cost of work on auxiliary systems is determined in other price lists.
Thus, the adjustment of inechanical technological equipment is based on a
57
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Table 16. Cost of Start-Up and Ad~ustment Work at Operating Production Fa-
cilities of the Chemical Industry (using the Orgkhim price list)
(1, . ~2~ ~ ~,Qonceoe coorunwc�
~ ~ ne no sranaM, ~
~f c~5
Or~ :em~ npoMwrnneuuocTi? ~ ~ o ~ � ~(~5 ) (61 (7 ~ ~
o~ xq~ ~i oa oz~
~s Uz$ s~: a~ ~~o
� ~ ~ c~i
-
9 ~30TII88
~0113B0~1CTN0:
( Q) aMMi~aKa 100 198 u0 37 13
~ 1~ K1p~1MNA8 1a~ 13J~~ .~~5 2~~~J ~2
~ 'LpC110BH0~1 .�.tIh1NN
- 9 jl poFC?noatcTeo:
( 3) ntioi~noro cynep~?oc- 350 82 32 55 13
chara
~ 4~ rp.~~~ynnposa~~i~uro 400 72 37 48 15
nn~ n~ o~oca
( SkriMi+4ecirnx eonox~~i~
~ 6~Ipon.inonc~rno nE+cxoa- 17 310 41,b' 45 13,5
� t~oro Kopna
Key :
1. Branch of industry
2. Annual capacity, in 1,000 tons
3. Cost of start-up and ad~ustment work, in 1,000 rubles
4. Proportion, by stage, in percent
5. Engineering superi~ision
6. Start-up periqd~ . -
7. Utilization,period
8. Nitrogen
9. Production:
10. Ammonia
11. Carbamide
12. Basic chemistry
- 13. Compound superpnosphate.
14. Granular ammophos '
15. Chemical fibers
16. Viscose cord production ~
price list wor.ked out by the:TsPKB Glavmontazh [Central Pl.anning and Design
Bureau of the':USSR Main Administration for Iustallation Work] and approved
by the USSR Gosstoy on 11 Julq 1969; he~.t-engineering equipment in accord-
ance with RSFSR Gosplan Price Lis.t No 260.SO1; automatic devices and machin-
- ery in accordance with a price.list approved by the..USSR Goastroy on 1
- April 1969; electric power engiri~2ering equipment in.accordance with a
58
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price list approved by the USSR Gosstroy on 1 January 1969; ventilation sys-
ter~s in accordance with a price list from the State Comanittee for Construc-
tion Affairs (USSR Gosstoy), approved on 1 April 1969. With consideration
of the start-up of auxiliary systems, the factor by which the cost of start-
up and ad~ustment work on the technological portion of nEwly operating fa-
cilities increases averages 1.7 to 2.3. This ratio can be traced using the
aata given in Table 17.
Table 17. Cost of Start-Up and Ad3ustment Work for Enterprise Basic and
Auxiliary Systems (data from Lenniigiprokhim UPNR)
~
~~.2 ) G�3 ) o(-`~ ) � ~ ~5 o x 3 ~6
. Q,q v m,v -~A s+~p
( t \ 1- x ;f L G~O m~ W x m
~i~ oq oA o~ o~o, ~~�m~=
C.ocran uycKOUnaaAovnwz a �,g ~ x o m o o~$
pnfior ti~ n'a a�a' ~-~tsJ c>s.".e
~ ~ OC OYS ~=I-O m.n
2 ~�J~
=.e. n$ n V .py~ OF c0
~F~.O'. 6tr5u VC.
. !]p'~ C.~ 6~ ~ c:L~00~W
Cec C~ Cx Cnxc i~~ i
(7~6utasi CTORMUCTb nyc- 9G6,5 920 2532 220,G 100
xona.79;[OY1Ibi% pa6or
(([7i11'), Twc. py6,
$8 Tora ~~cecne:
(9~. TceEionoru~+ecKa~ 212,8 2(il,5 14G5,9 99,7 45,3
4:lCTb
�~10~2, Mr.X~11I14CCNAR 253,8 2G4,9 ~12,5 81,6 27
R~CT6 ' -
(11~' Ten.voresnuUe- 116 39,2 72,5 8,3 5,2
crcas~ yacr~ .
4. Bci~rt~.~A~uion- 27,5 !0$,9 315 - 10
(12) ~~ax yacr~ -
5. ~1L'KTpOTC\HIf~lO- 2IS,1 - - 8,b 5
~1~~ CKIIft ~IBCTb ' �
XNMIi~ICCKa1l Do1to� 24,6 - - - 0~5
~14:~ O~INCTIC~ '
7. 3(Hil i~ aeron~aTU- E6,5 139,8 65,9 22,4 7
(15) xa
Key:
l. Compositiorc of s tart-up and ad3ustment work
2. Potassium tripolyphosphate prodt.ction
3. Phosphorous production
4. Compound superphosphate production
5. Production of barium hydroxide and barium carbonate
6. Proportion of cost of basic and auxiliary production sectors in to-
tal cost of PNR, in percent
7. Total cost of start-up and adjustment work (PNR), tn 1,000 rubles
8. Including:
9. Technological portion 13. Electrical engineering portion
10. Mechanical portion 14. Chemical water purification
11. Heat-engineering p~rtion 15. Check and test points and auto-
12. Ventilation portiori matic machinery
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Based on the above, start-up expenses are enterprise operating expenses in
the start-up period and the cost of technical services rendered by special-
ized organizations on start-up and ad~ustment work on basic production, with
consideration of cost increases for aervices to start-up auxiliary systems
of the facility being put into operation, Ka. Start-up expenses can be de-
creased by th~ cost of output suitable for sale which is manufactured during
the start-up period, Q�.
n m
~~n.ii.p. f C;p ~ ~ CTU ) Ka, Bu�
I ! ~12~*
Thus, start-up expenses are expenditures to prepare capacities for release
for full-time industrial operation. The start-up expenses estimate must
be drawn up in the planning stage. Start-up expenses include enterprise op-
erating expenditures during the production start-up period and technical as-
sistance by specialized start-up and ad~ustment organizations. They are re-
compensed after the facility has been put into operation through its current
activity.
Having examined the composition of start-up expenses, how they are shaped
and the sources for rec~mpensing them, we can move on to analyzing actus.l
expenditures (total and specific) on the start-up of various types of~ctiem-
ical industry production: comparing with expenditures on capital construc-
tion and with equipment cost, tracing the degree to which they inf luence the
net cost and profitability of new production.
Section 3. Expenditures of the Start-Up Period
In this section, we examine start-up expenses for newly operating facilities -
which are accepted as the basis for enterprise estimates and Ministry of
Chemical Industry reporting, which reflects the influence of expenditures
on putting new enterprises and individual production facilities into opera-
tion on output net cost.
The initial data have been systematized, processed and are given in tables
which reflect expenditures on the start-up and ad~ustment of specif ic pro-
duction, their weighted-mean values per unit of capacity, and norms for
writing off start-up expenses to the net coet of a unit of output.
Specific start-up expenses (in 'rubles) per unit of capacity, derived from a
generalization of data from similar production, are:
Inciustry: Production:
mining chemistry up te 2.7 extruded plastic items up to 327
basic chemistry up to 14 lacquers and dyes up to 403
nitrogen up to 95 chemical fibers up to 516
plastics and resins up to 165 chemical reagents up to 1154
- *Se~: ~ormula (5) for key.
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In connection with the existing system of recompensing start-up expenses
over a two-year pcriod following start-up of the facility through enterprise
activity, the expenditure write-off norms set for newly operating production
are 1.5- to two-fold lower than their specific values per unit of capacity.
Comparison shows that the proportion of start-up expenses under the recom-
pensation norms relative to net cost per unit of output reach 3.5 to 30 per-
cent in various types of production facility, as is evident from Table 18.
Table 18. Proportion of Start-Up Expenses in Net Cost of a Unit of Output
at Newly Operating Production Facilities
a(2) a~a~y3) (4)rma
C Y= O C O p
(1) M ~ U v y ~Ym
I~ppAIIpNAiIIA aY v~0 m v O
=a uauy, �~~d:
ws maA4 x~os -
~y xz .o a:e~s
~7x u au ~3a+1
Uq Ccss '~~,xur;
`5'YI~)NEl[tCKN11 3880J( A30TH61R
~ OGpCH{Ilf -
~