Parametric estimate

Parametric cost estimate is prepared during early stages of project development. The cost estimate is based on various parameters which define characteristics of the project and includes physical attributes such as size, capacity, weight etc. The parametric cost estimate is based on cost-estimating relationships those use past cost data to obtain the current cost estimate. Cost estimating relationships are statistical models those relate the cost of a product or system to the physical attributes those define its characteristics. One of the most commonly used cost-estimating relationships is power-sizing model.

Power-sizing model

Power-sizing model is most commonly used for obtaining preliminary cost estimate of industrial plants and equipment. The power sizing model relates the cost of a plant or system to its capacity or size and uses the following relationship for cost estimate.

Where

C₁ = cost of Plant 1

C₂ = cost of Plant 2

Q₁ = capacity or size of Plant 1

Q₂ = capacity or size of Plant 2

x = power-sizing exponent or the cost-capacity exponent