The value of the 2023 Chemical Engineering Plant Cost Index® (CEPCI) decreased compared to the previous year’s value, but remains substantially above the levels observed prior to the COVID-19 pandemic. The annual CEPCI value is calculated as an average of the monthly values for the index observed throughout the year. The decrease in the 2023 CEPCI annual value reflects easing in the rate of inflation observed in 2023.
The 2023 annual average for the CEPCI value is 797.9, a decrease of more than 18 points compared to 2022. Monthly values for the CEPCI rose modestly at the beginning of 2023, then fell gradually throughout Q2 and Q3 before a very small increase at the end of the year. Even with the decrease for 2023, the current CEPCI value remains significantly higher than the annual values observed during the 2014-2020 time period. The value for 2021 and 2022 saw massive increases due in part to the pandemic’s effects on the economy and supply chains.
The CEPCI is calculated based on a set of Producer Price Index (PPI) data from the U.S. Bureau of Labor Statistics (BLS; Washington, D.C.; www.bls.gov). The overall CEPCI represents the combination of four subindices: Equipment, Buildings, Construction Labor and Engineering & Supervision. For more information on the calculation of the CEPCI, see Chem. Eng., July 2023, pp. 43-44.
The decrease in the annual 2023 CEPCI was driven by decreases in two of the four subindices: the Equipment and Buildings subindices both decreased in 2023, more than offsetting small increases in the other two subindices (Construction Labor and Engineering & Supervision) compared to the corresponding 2022 annual values.