Life-Cycle Cost Analysis Lecture No 21 Chapter Contemporary Engineering Economics Copyright © 2016 Contemporary Engineering Economics, th edition Park Copyright © 2016 by Pearson Education, Inc All Rights Reserved Why Life-Cycle Cost (LCC) Analysis? Why? • To select from among design alternatives that fulfill the same performance requirements, but differ with respect to initial and operating costs • To predict the most cost-effective solution Contemporary Engineering Economics, th edition Park Fundamental Principle • When comparing different design alternatives, we need to consider both non-recurring as well as recurring costs over the life span of each design alternative Copyright © 2016 by Pearson Education, Inc All Rights Reserved Stages of Life-Cycle Cost Contemporary Engineering Economics, th edition Park Copyright © 2016 by Pearson Education, Inc All Rights Reserved Example 6.10: Pumping System with a Problem Valve Decision Problem: Fixing a pumping system with a faulty valve Design options: Sketch of a Pumping System in Which the Control Valve Fails o Option A: Buy a new control valve o Option B: Trim the pump impeller to reduce the pressure o Option C: Install a variable-frequency drive (VFD) o Option D: Repair the valve as needed Contemporary Engineering Economics, th edition Park Copyright © 2016 by Pearson Education, Inc All Rights Reserved Engineering Solution Alternatives • Option A: A new control valve can be installed to accommodate the high pressure differential • Option B: The pump impeller can be trimmed so that the pump does not develop as much head, resulting in a lower pressure drop across the current valve • Option C: A variable frequency drive (VFD) can be installed, and the flow control valve removed The VFD can vary the pump speed and thus achieve the desired process flow • Option D: The system can be left as it is, with a yearly repair of the flow control valve to be expected Contemporary Engineering Economics, th edition Park Copyright © 2016 by Pearson Education, Inc All Rights Reserved Life-Cycle Cost Elements Contemporary Engineering Economics, th edition Park Copyright © 2016 by Pearson Education, Inc All Rights Reserved Cost Comparison for Options A–D Contemporary Engineering Economics, th edition Park Copyright © 2016 by Pearson Education, Inc All Rights Reserved LCC Calculation for Option A Contemporary Engineering Economics, th edition Park Copyright © 2016 by Pearson Education, Inc All Rights Reserved Comparison of LCC for Options A–D Contemporary Engineering Economics, th edition Park Copyright © 2016 by Pearson Education, Inc All Rights Reserved ...Why Life- Cycle Cost (LCC) Analysis? Why? • To select from among design alternatives that fulfill the same performance requirements, but differ with respect to initial and operating costs •... non-recurring as well as recurring costs over the life span of each design alternative Copyright © 2016 by Pearson Education, Inc All Rights Reserved Stages of Life- Cycle Cost Contemporary Engineering... Education, Inc All Rights Reserved Life- Cycle Cost Elements Contemporary Engineering Economics, th edition Park Copyright © 2016 by Pearson Education, Inc All Rights Reserved Cost Comparison for Options