Question

Determine the most effective ways to determine the life expectancy of items on a construction project for life-cycle analysis?

Answer 1

After identifying all costs by year and amount and discounting them to present value, they are added to arrive at total life-cycle costs for each alternative:

LCC = I + Repl — Res + E + W + OM&R + O

LCC = Total LCC in present-value (PV) dollars of a given alternative
I = PV investment costs (if incurred at base date, they need not be discounted)
Repl = PV capital replacement costs
Res = PV residual value (resale value, salvage value) less disposal costs
E = PV of energy costs
W = PV of water costs
OM&R = PV of non-fuel operating, maintenance and repair costs
O = PV of other costs (e.g., contract costs for ESPCs or UESCs)