LCCA Life-Cycle Cost Analysis Group 3A

Introduction “Life-cycle cost analysis (LCCA) is a method for estimating the total cost of ownership of a building, taking into account the cost of acquisition, ownership, operating, and disposing of a building or building system.”

Introduction Enables to make a comparison between alternative solutions Can be performed on all sizes of buildings or isolated building systems Problems Uncertainty of input values Different budgets for building and operating costs

Methods ESTIMATING ALTERNATIVE BUILDING DESIGNS RELIABLE LONG TERM ASSESSMENTS WIDE SCOPE

Methods MAIN VARIABLES: COST TIME DISCOUNT RATE

Methods All of the costs of the entire ownership Cost construction 2% Maintenance 6% functioning 92% Recommended to be done in many stages of the projects Costs of different design solutions

Costs Several costs Initial costs Fuel costs Operating, maintenance and repair costs Replacement costs Residual values Other costs

Time Vital to choose suitable calculating period Not too long Choose to match with the economic life of the building Residential building years Commercial buildings around 20 years

Discount rate To make cash flows time-equivalent Future cash flows present value Smaller the higher the rate of intrest is and the farther into the future payment goes dis = 1/(1+r/100)î where, r = rate of interest i = time period

Life-Cycle Cost Calculation LCC = I pv + Repl — Res + E pv + W pv + OMR pv + O pv,

Supplementary measures PURPOSE TO FIND OUT: COST-EFFECTIVENESS RANKING PROJECTS SCREENING PROJECTS

Uncertainty evaluations ESTIMATING THE OUTCOME OF CHOOSING WRONG PROJECT ALTERNATIVE DETERMINISTIC AND PROBABILISTIC TECHNIQUES DETERMINISTIC TECHNIQUES ARE EASIER TO PERFORM Sensitivity analysis Break-even analysis

LCCA in real life Case study from the USA College Station (warmer) and Minneapolis (cooler) Insulation material fiberglass or polystyrene Three information 1. Payback time

LCCA in real life  2. Total life-cycle cost of insulation material (polystyrene left or fiberglass right)  3. Size of the insulation

LCCA in other countries LCCA has been standardized in Europe in 2008 The number of the standard is ” Buildings and constructed assets — Service-life planning — Part 5: Life-cycle costing”

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