Life Cycle Costing for Design Professionals
Life Cycle Cost Analysis in Energy Projects
Designers and facility planners determine low price high-efficiency building alternative by adopting Life Cycle Costing methodology
Low Cost Effective Design and Production Alternatives for Professionals
Life Cycle Costing for Design Professionals
Professional facilities planners, design professional need to offer creative out of the box design concepts that will not only express their individual styles but also highlight their interpretation of the fundamental building concepts of space, volumes and sizes. However, professional designers are at the helm of revolutionizing the vital aspect of innovative green strategies establishing new trends and experimenting with material alternatives that are not only eco friendly but are also cost-effective to the facility owner as well as the end user or a tenant.
How do designers determine low cost production alternatives?
Theoretical analytics such as the Life Cycle Costing have proven track record in assisting planners, designers and facility owners to gain meaningful insight into feasible and strategies to optimize the green strategies in a building. At the core of the Life Cycle Costing process is the comparisons it offers in terms of economics.
LCC methods of economic evaluation
The most common is the simple payback. Here the time required for gaining back the initial investment is calculated. Minimum payback time investment is determined as most profitable. A variation of this method is the discount payback method that considers the time value.
Net Present Value or the NPV in terms of LCC determines the least value alternative where the cash flows are discount against the present value. This helps in determining the time value and helps in generating investment returns on par with market value.
Equivalent Annual cost (ECA) This method is ideal when the NPV of an option can be decimated into uniform annual cost and comparison is made in terms of the life length of the option.
Internal Rate of Return calculates the return on an investment when the values are assumed as zero at the initial point of time. The option that reflects the highest IRR is considered as a good alternative.
Net Saving is the difference when the amount invested and the income generated is noted. Choosing the best alternative with highest net saving is the ideal choice.
Federal construction investments are evaluated for feasibility based on Life cycle Cost Analysis. Perhaps the first instances of costing construction expenses by the defense forces later percolated into civilian construction segment to lower production costs of construction. At the same time evaluating which option, such as the ideal type of glazing material to be used for a given design or the HVAC system that offers optimal efficiency for the given spatial design.
Design professionals adopt LCC for localized decision making at client end
Most times designers and planners need extra inputs to convince facility owners to adopt to emerging greener strategies essentially because of the likely 2% additional charges to incorporate such design concepts. The results of such candid analysis and cost comparison will provide the designer with the right leveraging power to press for greener strategies for the buildings.
Author Bio
Michael Vargas is the founder and principal consultant of Atlas Project Support. Mr. Vargas has more than 10 years of construction and energy accounting and utilization experience, and is a Certified Business Energy Professional through the AEE, a California Association Building Energy Consultant Certified Energy Plans Examiner, LEED Green Associate and GBCI Advisory Panel Member. Mr. Vargas also holds a BSBA from SDSU, MBA and MPM from Keller Graduate School. For more information contact Michael at or via the web at