Life-Cycle Cost Analysis
A typical life-cycle cost (LCC) calculation should take the following factors into
account:
• Material Cost • Fabrication Cost • Installation Cost
• Maintenance cost • Replacement Cost • Disruption cost
But typically, in most analysis, only the first 2 or at the most 3 factors are
considered. As a result of this, the study becomes skewed and when the other
costs are incurred during service life, the decision looks like a bad decision in
retrospect. To overcome this phenomenon, it is advisable to include all the costs.
An example of this analysis in water piping in a typical bathroom of a house is as
shown below:
LCC for 50-year life of Plumbing systems
Cost G I SS
Material cost 4,000 10,000
Installation Costs 4,000 4,000
Total 8,000 14,000
Average Life 10 years 50 years
Repairs during life Once (every 10 years) Nil
Cost of Repair (5 times) 10,000 0
Replacement 4 times (@Rs.15000/-) Nil
Cost of Replacement 60,000 0
Cost of Interiors 60,000 0
Total Lifecycle cost 138,000 14,000
(Disruption cost of GI not included)
Therefore, the actual cost of installing a Stainless Steel piping system is 1/10 of the GI system in the life of a house.
For details: please download the complete paper from http://stainlessindia.org/UploadPdf/MAY_2011.Pdf
