Concept
Battery limits are the line that divides a plant’s on-site capital into the process units themselves — inside battery limits (ISBL) — and the supporting infrastructure around them — outside battery limits (OSBL). The split is a costing convention: ISBL is estimated from the process equipment, OSBL from the utilities, storage, and site works that serve it, and the two together (plus indirect costs) make up the plant’s total capital.
Inside vs. outside the fence. The “battery limits” are originally a literal line on a plot plan — the fence around the core process area. Inside battery limits (ISBL) is the process plant proper: the unit operations that carry out the chemical and physical transformation and the equipment that realizes them — reactors, columns, exchangers, compressors, pumps, and the interconnecting pipe within the process area. Outside battery limits (OSBL), sometimes called offsites, is everything else on the site that supports the process but does not itself transform the product: utility generation and distribution (steam, cooling water, power, instrument air), feed and product storage and tankage, site preparation, roads, buildings, control rooms, effluent treatment, and safety systems.
Why the split exists. The two halves are estimated differently. ISBL is the part that can be built up bottom-up at the maturity anchor’s level: identify the major equipment per unit operation, size it, scale its cost with the six-tenths rule, and gross purchased-equipment cost up to installed cost with an installation factor. OSBL is much harder to resolve item-by-item this early — it turns on site specifics that aren’t known yet — so it is commonly carried as a fraction of ISBL rather than estimated from scratch.
From battery limits to total capital. ISBL + OSBL is the plant’s direct field cost. Total capex is reached by layering indirect costs on top — engineering, contractor fees, and contingency — usually also as factors. So the battery-limits split is one layer of the standard factored estimate: equipment → installed ISBL → + OSBL → + indirects → total capital. Each layer multiplies the one beneath it, which is why an error in the ISBL base propagates all the way up.
Typical OSBL magnitude. As a round planning figure, OSBL is often taken at roughly 30–50% of ISBL for a conventional plant on a developed site, and substantially more for a greenfield site that must build its own utilities and infrastructure. Because it is a factor on ISBL, OSBL inherits ISBL’s uncertainty and adds its own.
Battery limits vs. system boundary. Battery limits are an on-site, physical, capital-allocation line: process units vs. site infrastructure, both on the same plot. The system boundary is the broader analytical scope — what the whole analysis counts at all — and can extend upstream and off-site (to feedstock production, distribution, end-of-life) where no battery-limits fence reaches. The two coincide only when the analysis is scoped exactly to the on-site plant; whenever the system boundary is drawn wider, battery-limits cost is just one component inside it.
What counts as ISBL is a convention. The exact line — whether a dedicated feed compressor, a cooling tower serving only the process, or a pipe rack falls inside or outside — varies by estimator, firm, and reference source. The division has to be applied consistently within an estimate and matched when comparing estimates. The total on-site capital is invariant to where the ISBL/OSBL line falls; each half is not.
Costing a green ammonia plant at the maturity anchor’s level splits cleanly along battery limits. Inside are the process unit operations: the hydrogen and nitrogen feed sections, the synthesis-gas compression, the ammonia reactor, and the product separation and refrigeration — the equipment carrying the H₂:N₂ ≈ 3:1 feed around a loop at ~20% per-pass conversion (the running-example baseline). These are estimated bottom-up: the two or three largest items (here the compression train and the reactor) are sized and scaled with the six-tenths rule, then grossed up to installed ISBL cost with an installation factor. Outside are the offsites: refrigerated ammonia storage, the cooling-water and power-distribution systems, site prep, buildings, and effluent handling.
With ISBL estimated, OSBL is added as a round fraction of it — taking ~40% of ISBL as a planning anchor here (a generic factor, not a sourced site figure) — and indirect costs are layered on to reach total capex. The same structure holds for the gray route; what changes inside ISBL is the H₂ source (a reformer instead of an electrolyzer) and the added CO₂-capture block, not the ISBL-plus-OSBL accounting itself.
To show the edge, a separate one-line instance: site context, not the equipment, can dominate the OSBL term — the same ISBL ammonia plant dropped on a remote greenfield site that must build its own power and water can carry an OSBL fraction well above the ~40% used here, so a generic factor that ignores the site understates total capital.