Maintenance costs and life cycle cost analysis pdf

Life cycle cost analysis is a procedure in which initial cost, maintenance requirements, and life span are jointly considered in the evaluation of alternative project designs 1, 2, 3. Fundamentals of asset management 5 concepts of cost particularly useful to am current replacement cost the full cost to replace an asset in its current operating environment life cycle cost the total cost of an item throughout its life, including the costs of planning, design, acquisition, operations, maintenance, and. Lifecycle cost analysis maintenance and engineering. Life cycle costing predicting life cycle costs as part.

Wholelife costing covers an assets costs from the time you purchase it to the time you get rid of it. Page 3 includes a summary of the life cycle costs associated with the four schemes. Good operating procedures and standard practices exist that prevent unnecessary asset damage. The vice provost for land and buildings convened a team of staff from departments within land and buildings, along. Availability statement equipment life cycle cost analysis, equipment maintenance, fleet management, benefit cost analysis. Life cycle cost analysis is an important step in the estimation of factors when making a budget for any new project. Maintenance costs and life cycle cost analysis 1st edition. Life cycle costing lcc, by definition, refers to an analysis technique which encom passes all costs associated with a product from its inception to its disposal. Lcca is a subset of benefitcost analysis bca, an economic analysis tool that compares benefits as well as costs in selecting optimal projects or implementation alternatives. As opposed to more commonly used roibased calculations, lcc is conducted based on longterm costs and savings, keeping in mind the fact that they are interconnected. Jul 28, 2019 today we know life cycle cost as a highly useful analytical tool that can help you minimise waste and optimise energy efficiency especially when incorporated into a fully customised computerised maintenance management system cmms. Life cycle cost analysis lcca has been used for similar purposes.

Life cycle costs lcc represent the overall costs being spent during the buildings whole life cycle. Maintenance costs and life cycle cost analysis 1st. The present worth of the initial cost and future maintenance and replacement costs are considered rather than just the initial costs. The general concept of a life cycle cost is not new. Lifecycle cost analysis lcca has been used for similar purposes. Terminology commonly used with regard to life cycle cost analysis.

Necessarily, the text starts with importance of maintenance function in the organization and moves to life cycle cost lcc considerations followed by the budgeting constraints. Costs of submarine maintenance at public and private shipyards. Buying an asset is a cost commitment that extends beyond its price tag. Energy modeling software and developing life cycle cost analysis. Most agree that life cycle cost analysis can be carried out using a few standardized steps. More information is also available in a stanford university independent study for its. Sep, 2018 life cycle costing, or wholelife costing, is the process of estimating how much money you will spend on an asset over the course of its useful life.

Life cycle cost analysis is a structured method of determining the entire cost of a structure, product, or component over its expected useful life by adding the cost of operating, maintaining, and using it to the purchase price. The life cycle cost analysis provides the present value pv of annual cost and the life cycle cost, and it compares the accumulated cash flow. In essence, life cycle costing is a means of estimating all the costs involved in procuring, operating, maintaining and ultimately disposing a product throughout its life. An lcca considers all agency expenditures and user costs throughout the life of an alternative. With the lcc estimating features linked directly to the design and. Maintenance costs and life cycle cost analysis request pdf. Lcca is especially useful when project alternatives that fulfill the same performance requirements, but differ with respect to initial costs and. Maintenance, costs, and,life, cycle, cost, analysis full download created date. Life cycle costing colorado department of transportation 4 3. Benefit cost analysis bca is a framework for evaluating the desirability of transportation capital and maintenance investments. Purpose the purpose of this research project is to develop guidelines that allow cdot to capture the longterm costs of adding additional capacity and other transportation related improvements to the state highway and bridge system. An economic examination of alternative allocation of capital resources that considers all significant costs of ownership over the economic life of the alternatives and considers the cost of the capital.

The process of a typical lcca can be divided into the following. Other costs maintenance costs typical life cycle costs for a mediumsized industrial pump the life cycle cost lcc of any piece of equipment is the total lifetime cost to purchase, install, operate, maintain, and dispose of that equipment. Availability statement equipment lifecycle cost analysis, equipment maintenance, fleet management, benefit cost analysis. Building maintenance and repair data for lifecycle cost. The simplest application of lifecycle cost analysis can help to counter this instinct by making asset lifecycle cost drivers visible. On average, overhauls at private shipyards have been 31 percent less. The life cycle cost includes the system capital cost, energy cost, system maintenance and replacement cost over a 20year of life span. Life cycle cost analysis lcca is a datadriven tool that provides a detailed account of the total costs of a project over its expected. Life cycle cost lcc analysis can prove that although the initial cost of a product might be higher, the overall lifetime cost is lower than that of a competitor as the product requires fewer repairs or less maintenance. Life cycle cost analysis lcca is the process of economic evaluation used to assess the most cost effective option among various initial costs of the product or project development, operation, maintenance and decommission. Lifecycle cost analysis lcca is a method for assessing the total cost of facility ownership.

Calculation requires sound knowledge of how the asset finds use, the various costs involved through its lifetime, and the application of economic analysis techniques to determine the present value of such future expenses. It takes into account all costs of acquiring, owning, and disposing of a building or building system. Request pdf maintenance costs and life cycle cost analysis authors have attempted to create coherent chapters and sections on how the fundamentals of maintenance cost should be organized, to. Why you need to calculate the life cycle cost of equipment. Lifecycle cost analysis an overview sciencedirect topics. Lifecycle cost analysis introduction october 20 lifecycle cost analysis realcost 2. In the process, they have intentionally postponed the discussion about intangible costs and downtime costs later on in the book mainly due to the controversial part of. Life cycle cost analysis lcca is a method for assessing the total cost of facility ownership. The determination of life cycle costs of alternative pavement types is an important.

Page 4 summarizes the hvac costs as well as ancillary costs associated with each scheme. This cost model now includes features for estimating the costs of ship operations and other life cycle activities. The pie chart in figure 1 was developed as a base case lcc model combining capital costs with anticipated operating costs over five years. Emphasis on maintenance cost and life cycle cost especially under uncertainty. The results of this comparative lifecycle cost analysis indicate the future potential of the znbr technology for all three system sizes and the nearterm attractiveness of the maintenancefree. An appropriate and nonbiased method for life cycle cost analysis is articulated by the federal highway administration fhwa in demonstration project no. Life cycle costing an overview sciencedirect topics. A life cycle cost analysis lcca is a method to assess total cost of ownership, considering all costs associated with acquiring, owning, and disposing of an asset. Benefitcost analysis bca is a framework for evaluating the desirability of transportation capital and maintenance investments. Guram, in thanks for his guidance, honesty, support, and friendship over the years. Pdf book maintenance costs and life cycle cost analysis author. It compares initial investment options and identifies the least cost alternatives for a twenty year period. The naval ship life cycle cost lcc model is an extension to spars existing cost model for estimating costs for ship design and new construction.

Life cycle costing lcc lcc acquisition maintenance endof life 4 0 preacquisition costs selling price postacquisition costs environmental externalities recipe method external costs direct costs indirect costs life cycle costing is a methodology where costs of a given asset are considered throughout its life cycle 201424eu art. This enables decisions on acquisition, maintenance, refurbishment or disposal to be made in the light of full cost implications. When looking at maintenance costs, the most important concept that you must remember is that your organizations behaviors change the resulting cost. Pdf book maintenance costs and life cycle cost analysis. Life cycle costing analysis lcca or lcc for short is the most accurate way to increase your buildings project savings by comparing different design alternatives. A life cycle costing analysis determines the whole of life cost of asset ownership from cradle to grave, taking into account design, purchase, installation, commissioning, operations, maintenance and disposal.

Systematic approach of how cost models can be applied and used in the maintenance field. How to perform a life cycle cost analysis brighthub project. Through lcc one seeks to minimize the cost of obtaining a cer tain level of output. Agency costs include initial construction costs as well as costs associated with maintenance, repair, preservation, and rehabilitation activities that will be needed over an analysis period. This is a useful performance measure, as it can be related to the cash flow generated by the energy savings. Life cycle cost analysis is a method of analysing the cost of a system or a product over its entire lifespan.