www.heatingandventilating.net
materials) can add to end-of-life disposal costs. The LCC process itself varies. It can be as simple as drawing up a table of expected annual costs or it can employ a complex computerised model that allows for the creation of scenarios based on assumptions about future cost drivers. Life cycle costs are significantly higher than
purchase price alone; indeed, the cost of running and maintaining an office building, for example, has been estimated at about 200 times the cost of building itself. Disregarding LCC can lead to components and systems being specified solely on price and the minimum standard rather than overall performance over the asset’s lifetime.
Before going further it’s worth dispelling a
stubbornly enduring misconception about LCC… that it is the same as whole life costing (WLC) – it isn’t. Although the terms are often used interchangeably, they have subtly different meanings.
According to the Royal Institution of Chartered Surveyors (RICS), LCC accounts for all relevant costs over a defined period of time (called the ‘period of analysis’). LCC can also address a period of analysis covering the entire life cycle from cradle to grave, so to speak (a definition that could apply equal ly toWLC). However, says the RICS: “The difference between LCC and WLC is that LCC focuses only on the
construction, maintenance, operation and disposal of the asset, whereas WLC also includes client and user costs, such as project financing, land, income and external costs (those not born by parties to the construction contract – such as tenants).”
LCC offers a host of benefits, including:
• It increases the visibility of costs and therefore enables you to take early actions to generate revenue or to lower costs.
• It arms you with the information you need to mak e better buying decisions, helps you understand the longer term cost consequences of specifying particular products, and enables you to take early actions to control costs.
• With the growing emphasis on sustainability and energy efficiency, LCC enables you to invest in systems that save energy.
• It enables you to test different scenarios to decide the best one for your business.
Pipes, valv ANALY
a life cycle cost analysis (LCCA). For the building services sector
T
ou can prepare a maintenance schedule that promotes efficiency
• You become knowledgeable about plant and equipment costs. • You c
ou become kno Yo omotes efficiency ncy Yo y..
• Maintenance and repair budgets will be more accur ate. • You c
epair budgets will be mor
ou can ensure that replacement parts are kept close at hand.
• It enables you to improve energy conservation.
conservation. • Al
• Alternative components or systems can be compared from a long-term cost perspective. • It fosters compliance with building regulations and guidelines.
s sector determine the most cost-effectiv
lves & fittings
LYSIS OF COSTS he best way to assess the total cost of
owning an asset – whether a product, system or entire building – is to perform
r,, LCCA is a way to -effective way to make
the most of HVAC equipment among competing alternatives.
Depending on the period of analysis, this could stretch from purchase, to owning, finall
operating, maintaining and, finally, disposing of the equipment. CCA offer
LCCA offers several solid business advantages. For e xample: Yo
al solid business adv antages.
21
Page 1 |
Page 2 |
Page 3 |
Page 4 |
Page 5 |
Page 6 |
Page 7 |
Page 8 |
Page 9 |
Page 10 |
Page 11 |
Page 12 |
Page 13 |
Page 14 |
Page 15 |
Page 16 |
Page 17 |
Page 18 |
Page 19 |
Page 20 |
Page 21 |
Page 22 |
Page 23 |
Page 24 |
Page 25 |
Page 26 |
Page 27 |
Page 28 |
Page 29 |
Page 30 |
Page 31 |
Page 32 |
Page 33 |
Page 34 |
Page 35 |
Page 36 |
Page 37 |
Page 38 |
Page 39 |
Page 40 |
Page 41 |
Page 42 |
Page 43 |
Page 44 |
Page 45 |
Page 46 |
Page 47 |
Page 48 |
Page 49 |
Page 50 |
Page 51 |
Page 52
