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					                                                                                                                      Version No. 1
             DEFENCE GREEN BUILDING REQUIREMENTS PART 1                                                               Issue Date: 4 Sep 2006
          WOL (WHOLE OF LIFE) COSTING FOR ESD INITIATIVES IN DBC                                                      Amendment Dates:
                                                                                                                      Review Date: Mar 2007


     Purpose
     The Commonwealth Procurement Guidelines require that value for money should be evaluated on a whole-of-life basis. The WOL
     Costing Tool for ESD Initiatives in the Detailed Business Case (DBC) will provide guidance on the appropriate parameters for a WOL
     investigation. It will:

     n    Present key definitions
     n    Formulate and present an approach which allows for capture of non-financial determinants
     n    Provide advice for criteria that are relevant for determining WOL for various building and system elements
     n    Provide a sample WOL calculation for a lighting system


     Use
     The WOL Costing Tool will be utilised during the DBC stage as a means to provide accurate costings and inform design decision-
     making as various options are considered to meet the Defence Green Building Requirements (GBR) Part 1. Note that WOL costing is
     synonymous with life cycle costing; however life cycle analysis, which captures extensive non-financial benefits and typically takes a
     "cradle to cradle" approach is a separate exercise altogether and the terms should not be confused. Information on life cycle analysis is
     presented in the following page.


     The Tool will be utilised primarily by quantity surveyors in order to provide accurate cost estimates to Defence and to other project
     team members. It can also be utilised by other external project team members as an informal resource to assist in narrowing down
     design and system choices as the project moves toward 30% (approximately) design completion. The Tool will also assist Defence
     project staff in reviewing design decisions and costings put forward by the project team.

     The WOL tool can be used for both minor and major projects.




WOL costing for ESD initiatives in DBC v1 4Sep2006
WOL costing for ESD initiatives in DBC v1 4Sep2006
WOL costing for ESD initiatives in DBC v1 4Sep2006
WOL costing for ESD initiatives in DBC v1 4Sep2006
WOL costing for ESD initiatives in DBC v1 4Sep2006
WOL costing for ESD initiatives in DBC v1 4Sep2006
WOL costing for ESD initiatives in DBC v1 4Sep2006
WOL costing for ESD initiatives in DBC v1 4Sep2006
WOL costing for ESD initiatives in DBC v1 4Sep2006
WOL costing for ESD initiatives in DBC v1 4Sep2006
WOL costing for ESD initiatives in DBC v1 4Sep2006
WOL costing for ESD initiatives in DBC v1 4Sep2006
   Terms and Definitions
   The following terms and definitions are provided for the benefit of consistency of approach when undertaking a WOL costing.

   Item                              Description
   Capital cost                      All costs associated with the initial procurement including planning, design, construction and commissioning. These cost
                                     are usually non-recurring, though will need to capture replacement costs if the effective life of the element is less than the
                                     effective life of the project. Refer Effective Life below.
   Discounted cashflow               Presentation of future cash flow cost to a common time base (i.e. present day) using discounting techniques to allow
                                     comparable cost comparisons to be made.
   Discount rate                     The rate reflecting the time value of money that is used to convert benefits and costs occurring at different times to the
                                     equivalent cost at common point in time, and is normally expressed as a percentage per annum.
   Effective Life                    The period of time after which it becomes more economical to replace rather than to maintain a system or component.
                                     Can be referred to as "indicative product life."

                                     In an WOL calculation, if the effective life of the product or element is less than the project effective life, additional
                                     capital expenditure is required to replace the element and needs to be captured as a capital cost.
   Elements                          A portion of the project that fulfils a particular physical purpose.
   Net Personnel and Operating       NPOC is the difference between future operating costs and current funded operating costs associated with a capability,
   Costs (NPOC)                      facility, system or specific item of equipment. It reflects the net difference between the cost estimates to operate a new,
                                     upgraded or replacement capability offset by the guidance available to operate the current capability, across all affected
                                     Groups.
   Net Present Value (NPV)           The discounted cost of the flow of all expenses including capital outlay over the evaluation period for the building
                                     component under consideration.
   Non-discounted cash flow          Presentation of anticipated expenditure over the evaluation period based on current rates.
   Recurrent cost                    Combination of ongoing costs such as operating costs inclusive of energy, water, waste, maintenance costs such as
                                     corrective and replacement, and garrison support costs such as cleaning.
   Residual Value                    The recoverable value of a component at the termination of the evaluation period, expressed as a negative cost.

                                     Value of recoverable materials generally based on quantity of materials involved; it is up to the discretion of the user to
                                     determine of the quantity being considered for the project is viable to cost as a recoverable asset. However, take back
                                     versus materials sent for disposal should be quantified.
   Sensitivity Analysis              Testing the outcome of an evaluation by altering the values of key factors such as the discount rate, the effective life or
                                     others about which there might be uncertainty.




   WOL Costing




WOL costing for ESD initiatives in DBC v1 4Sep2006
   WOL costing can be defined as the total of the direct/indirect, recurring/non-recurring, fixed/variable financial costs to the Commonwealth arising out of, or
   in any way in connection with, the Works over the whole life of the Works including the costs of designing and constructing the Works prior to Completion
   and operating and maintaining the Works after Completion.

   The objective of WOL costing is to assist in decision making by providing a means of comparing different option costs. WOL objectives in a defence project
   means balancing:
     (a) WOL Cost;
      (b) the useful life of the Works;
      (c) the reliability and availability for use of the Works throughout their useful life;
      (d) the operability and maintainability of the Works throughout their useful life;
      (e) the value for money achieved by the Commonwealth from the design, construction, operation and maintenance of the Works;
      (f) the achievement of the ESD Principles; and
      (g) the achievement of the specific additional matters (if any) relating to WOL specified in the Contract Particulars
   Typically WOL option cost data is inputted into a decision model which considers factors such as a discount rate, costs / rates for energy, water charges, cost
   escalation (only for items or instances over and above the anticipated rate of inflation), etc. Provided inflation for all costs is approximately equal, the
   calculation should exclude cost escalation impacts when undertaking WOL costing.

   WOL costing may initially be performed early in the design process when data with limited accuracy is available (though will be updated as more accurate
   data becomes available), which may impact on the overall analysis outcome. Sensitivity analysis techniques can be applied to the decision model to
   measures how expected values will be affected by variation of critical data inputs. Data points that can be subject to a sensitivity analysis include capital
   cost, discount rate and energy rate. The values are chosen to reflect the level of uncertainty for the data. For example the sensitivity analysis may consider the
   effects of a +/- 10% variation in capital cost.

   WOL cost information and effective product life typically come from various sources such as: historical data, manufacturers’ advice, Defence advice
   (including discount rate based on Defence recommended rate), industry cost guides, industry guides (e.g. AIRAH, ASHRAE, CIBSE) and ESD best practice
   resources. As the project is developed the WOL costing is refined by reviewing the additional details developed for selected options against previous data
   and assumptions.

   The flowchart below describes the steps and considerations that are part of a WOL investigation. WOL costing allows for:




   Model of discounted WOL Costing




WOL costing for ESD initiatives in DBC v1 4Sep2006
   The below flowchart demonstrates the process for evaluating whole of life costs for different building elements / design options, allowing for an equitable
   comparison to be made. The chart also demonstrates that, when considering products and elements from an ESD perspective, non-financial determinants
   such as ecological and social values can be applied to the decision-making. Examples of ecological and social values might include demonstration of
   leadership in sustainable environmental management, water savings, enhancement or protection of flora and fauna, recycled content and recyclability,
   improved indoor environmental quality, materials from local sources, 'triple bottom line' record / reporting of suppliers, improved productivity, preserved
   cultural and heritage resources, etc. These measures should be brought in as an adjunct to the WOL calculation (as WOL traditionally deals with financial
   parameters only). Additionally, different weightings can be applied to the economic, ecological and social measures to ensure that a balance is reached that
   suits the needs of the user.

    Determine system or
    element to be costed


    Nominate options to be
         compared



           Initial
                                                              Discount rate
        Capital Cost


   Component Capital Cost
    replacement based on        Non-discounted cash       Discounted Cash flow             NPV                Sensitivity Analysis
         effective life                 flow


      Recurrent Costs:
       Maintenance;                                             Additional                                   Potential Option Costs
       Utility Costs;                                         Comparison:
       Cleaning; etc                                          Non-financial
                                                                                                                                                                    Design Reports
                                                              determinants
                                                           Evaluate and apply:
                                                           - ecological values                               Recommended Option            Costing Plan
                                                              - social values
                                                                                                                                                                   NPOC, Maintenance
                                                                                                                                                                  Plan, Post Occupancy
                                                                                                                                                                         Review

   Further information on Whole of Life or life cycle costing may be found at:
   Australian National Audit Office Better Practice Guide:
   http://www.anao.gov.au/WebSite.nsf/Publications/4A256AE90015F69B4A256B57001DC439/$file/15543_ANAO+LCC+guide2.pdf
   AS3595 - Energy management programs— Guidelines for financial evaluation of a project
   Whole Building Design Guide: http://www.wbdg.org/design/lcca.php
   US Department of Energy - Building Technologies Toolbox: http://www.eere.energy.gov/buildings/info/design/wholebuilding/costanalysis.html




WOL costing for ESD initiatives in DBC v1 4Sep2006
   Life Cycle Assessment

   For the purpose of evaluating ESD benefits, it is possible to undertake a life cycle assessment (a k a life cycle analysis, eco-balance). A Life Cycle
   Assessment (LCA) systematically describes and assesses all material, energy and ecological flows related to a product or process from a cradle to grave
   perspective. There are two main steps in an LCA.

   1.) Describe which emissions will occur and which raw materials are used during the life of a product. This is usually referred to as the inventory step.
   2.) Assess what the impacts of these emissions and raw material depletions are. This is referred to as the impact assessment step.

   A complete life cycle assessment will combine the extensive environmental / ecological analysis with costing information to inform decision-making around
   product selection. All stages in the life of a product are analysed: raw material acquisition, manufacture, transportation, installation, use, and recycling and
   waste management. Economic performance should be measured using whole of life or life cycle costing methods which covers the costs of initial
   investment, replacement, operation, maintenance and repair, and disposal.

   Note that a proper LCA is a complex and costly undertaking that requires enormous volumes of data and extensive investigations to be done
   objectively. For more information, the following references can be searched:

   US Environmental Protection Agency - Systems Analysis Research: http://www.epa.gov/ORD/NRMRL/std/sab/lca/index.html
   Ecospecifier: http://www.ecospecifier.org/knowledge_base/downloads/life_cycle_analysis
   Life Cycle Assessment links: http://www.life-cycle.org/
   American Center for Life Cycle Assessment: http://www.lcacenter.org/




WOL costing for ESD initiatives in DBC v1 4Sep2006
WOL costing for ESD initiatives in DBC v1 4Sep2006
WOL costing for ESD initiatives in DBC v1 4Sep2006
WOL costing for ESD initiatives in DBC v1 4Sep2006
WOL costing for ESD initiatives in DBC v1 4Sep2006
WOL costing for ESD initiatives in DBC v1 4Sep2006
WOL costing for ESD initiatives in DBC v1 4Sep2006
WOL costing for ESD initiatives in DBC v1 4Sep2006
WOL costing for ESD initiatives in DBC v1 4Sep2006
WOL costing for ESD initiatives in DBC v1 4Sep2006
WOL costing for ESD initiatives in DBC v1 4Sep2006
WOL costing for ESD initiatives in DBC v1 4Sep2006
   WOL" Rules of Thumb"
   The WOL "Rule of Thumb" table below provides a guidance on a range of ESD design considerations and complementary elements. (This table is not an exhaustive list
   and there may be other elements to consider.) Effective ESD design usually involve a combination of elements rather than a single element or components in isolation.
   Therefore effective WOL option assessment needs to consider the combined effect of an ESD option. For example the assessment of double glazed windows should
   consider the reduction in energy used by the mechanical system.

   The required effective life of a building is usually defined in the FDB. The WOL options need to consider the relationship between the effective life of the building and
   the effective life of the components / complimentary elements being considered in WOL options.

   In WOL costing for ESD initiatives, each building will have a number of areas that can be assessed:
   o Building fabric,
   o Internal finishes,
   o Structures,
   o Fitments,
   o Building Services,
   o Sitework

   The key to the complimentary elements is found below and is based on the Australian Institute of Quantity Surveyors definition of elements. The column is meant to
   indicate that whilst WOL calculations may be performed on individual elements only, it is more likely and necessary that the WOL investigation capture considerations
   from other elements. For example, WOL costing of glazing will need to be informed by other building fabric issues and the heating and cooling system.


   Note that the effective product life listed is indicative only and confirmation is required for each element / component being considered. Further, indicative product life
   (or, the economic life) should not be confused with functional and technological obsolescence. Whilst in reality, many products, systems and finishes will be replaced
   before the end of their economic life, there is no consistent nor objective means to cost these considerations into a WOL calculation and therefore they cannot be factored.


   ESD Design         Description          Complimentary       Effective Product      Recurrent Costs        Residual Value
   Consideration                           Elements            Life (indicative only)




WOL costing for ESD initiatives in DBC v1 4Sep2006
   Structures
                       Substructure      SB, CL, UF, RF    25 + years              Protective coatings         Material recovery (Timber or
                                                                                                               steel framing, floor lining),
                                                                                                               recyclable material recovery
                                                                                                               (Concrete, Steel
                                                                                                               reinforcement)

                       Upper Floors &    SB, CL, UF, RF    25 + years              Protective coatings         Material recovery (Timber or
                       Columns                                                                                 steel framing, floor lining),
                                                                                                               recyclable material recovery
                                                                                                               (Concrete, Steel
                                                                                                               reinforcement)

   Building Fabric
                       Glazing           WW, EW, AC        25 + years              Moving part and seal        Framing material recovery
                                                                                  replacement, paint           (aluminium, timber)
                                                                                  finishes, energy cost


                       External Walls    WW, AC, WF, CL,   25 - 25 + years         Seals, finishes, fixings,   Material recovery (metal,
                                         SB                                       energy cost                  timber)


                       Roof              SB, CL, EW, AC    25 - 25 + years         Seals (roof fabric /   Material recovery (metal
                                                                                  membrane), landscaping, cladding, steel framing)
                                                                                  energy cost

   Internal Finishes
                       Floor coverings                      Carpet: 5 - 15          Finishes / re-finishes;    Material recovery (timber) ,
                                                           Linoleum, vinyl,        fixings, cleaning regimes   carpet leasing / take-back
                                                           rubber: 15 - 20                                     policies
                                                           Timber: 25 +
                                                           Tiling, terrazzo - 25 +
                                                           Concrete - 25 +




WOL costing for ESD initiatives in DBC v1 4Sep2006
                       Wall finishes    EW, NW           Paint: 5 - 10                                       Material recovery (timber)
                                                         Timber panelling: 25
                                                         +
                                                         Vinyl: 25 +
                                                         Wall fabrics: 15
   Fitments
                       Joinery                           25 + years              Hardware / moving parts,    Material recovery (timber)
                                                                                finishes / re-finishes

   Building Services
                       Hydraulics      XR, XK, XW, XD,    Pipes 25 + years       Fittings and moving          Material recovery (copper
                                       PD, WS                     Fixtures 20 - parts, seals, cleaning       pipes)
                                                         25 years               regimes, pumps
                                                                                (servicing), water costs
                       Lighting         WW, AC, EW        Wires 25 + years       Replacement of lamps,       Material recovery (metal)
                                                            Fixtures 20 - 25    ballasts, covers /
                                                         years                  diffusers, control
                                                                                component failure /
                                                                                upgrade, energy costs
                       HVAC            EW, WW, RF, LP,    Refrigeration plant:   Component                   Material recovery (metal)
                                       GS, WS, CE        15 - 20 years          maintenance, energy
                                                         Fans: 20 - 25 years    costs, water costs,
                                                         Pumps, motors: 20 - cleaning costs, ongoing
                                                         25 years               operational replacements
                                                         Cooling towers: 10 - (filters, belts, lubricants,
                                                         25 years               etc.)
                                                         Packaged air
                                                         handling: 15 - 20
                                                         years
                                                         Radiators: 25 + years
                                                         Boilers: 20 - 25 years
                                                         Minor plant: 15 - 20
                                                         years



   Siteworks




WOL costing for ESD initiatives in DBC v1 4Sep2006
                        Roads and              XK, XL, XP         25 + years    Landscaping
                        footpaths,                                             maintenance /
                        stormwater retention                                   remediation, sealing /
                                                                               topping, water cost



   Definition of Elements

         00        PR                          PRELIMINARIES
   SUBSTRUCTURE
         01        SB                          SUBSTRUCTURE
   SUPERSTRUCTURE
         02        CL                          COLUMNS
         03        UF                          UPPER FLOOR
         04        SC                          STAIRCASES
         05        RF                          ROOF
   EXTERNAL FABRIC AND FINISHES
         06        EW                          EXTERNAL WALLS
         07        WW                          WINDOWS
         08        ED                          EXTERNAL DOORS
   INTERNAL FABRIC AND FINISHES
         09        NW                          INTERNAL WALLS
         10        NS                          INTERNAL SCREENS & BORROWED LIGHTS
         11        ND                          INTERNAL DOORS
         12        WF                          WALL FINISHES

         13             FF                     FLOOR FINISHES
         14             CF                     CEILING FINISHES
   FITMENTS
         15             FT                     FITMENTS
         16             SE                     SPECIAL EQUIPMENT
   SERVICES
         17             SF                     SANITARY FIXTURES
         18             SD                     SANITARY PLUMBING
         19             WS                     WATER SUPPLY
         20             GS                     GAS SERVICE




WOL costing for ESD initiatives in DBC v1 4Sep2006
         21       SH                   SPACE HEATING
         22       VE                   VENTILATION
         23       EC                   EVAPORATIVE COOLING
         24       AC                   AIR CONDITIONING/MECHANICAL SERVICES
         25       FP                   FIRE PROTECTION
         26       LP                   ELECTRIC LIGHT & POWER
         27       CM                   COMMUNICATIONS
         28       TS                   TRANSPORTATION SERVICES
         29       SS                   SPECIAL SERVICES
   CENTRALISED ENERGY SYSTEMS
         30       CE                   CENTRALISED ENERGY SYSTEM
   ALTERATIONS
         31       AR                   ALTERATIONS
   SITEWORKS
         32       XP                   SITE PREPARATION

          33       XR                  ROADS, FOOTPATHS & PAVED AREAS
          34       XN                  BOUNDARY WALLS, FENCING & GATES
          35       XB                  OUTBUILDING
          36       XL                  LANDSCAPING & IMPROVEMENTS
   EXTERNAL SERVICES
          37       XK                  EXTERNAL STORMWATER DRAINAGE
          38       XD                  EXTERNAL SEWER DRAINAGE
          39       XW                  EXTERNAL WATER SUPPLY
          40       XG                  EXTERNAL GAS
          41       XF                  EXTERNAL FIRE PROTECTION
          42       XE                  EXTERNAL ELECTRIC LIGHT & POWER
          43       XC                  EXTERNAL COMMUNICATIONS
          44       XS                  EXTERNAL SPECIAL SERVICES
          45       XX                  ALTERATIONS & RENOVATIONS TO EXT WORKS
   SPECIAL PROVISIONS
          46       YY                  SPECIAL PROVISIONS (Provisional Sums)




WOL costing for ESD initiatives in DBC v1 4Sep2006
WOL costing for ESD initiatives in DBC v1 4Sep2006
tary elements. (This table is not an exhaustive list
han a single element or components in isolation.
 assessment of double glazed windows should



 hip between the effective life of the building and




definition of elements. The column is meant to
 at the WOL investigation capture considerations
d the heating and cooling system.


being considered. Further, indicative product life
 products, systems and finishes will be replaced
L calculation and therefore they cannot be factored.


               Related ESD considerations:




               WOL costing for ESD initiatives in DBC v1 4Sep2006
Local material sourcing, recycled content




Local material sourcing, recycled content




Daylighting, natural ventilation, thermal
comfort, natural resource extraction, local
material sourcing, PVC minimisation,
greenhouse gas emissions

Natural resource extraction, local material
sourcing, PVC minimisation, thermal
comfort, greenhouse gas emissions

Recycled content, local ecology,
stormwater emissions (site damage and
downstream impacts), greenhouse gas
emissions

Local sourcing, recycled content, PVC
minimisation, use of natural materials /
natural resource management, VOCs /
indoor environmental quality, end of life
provisions / recyclability




WOL costing for ESD initiatives in DBC v1 4Sep2006
Local sourcing, PVC minimisation, use of
natural materials / natural resource
management, VOCs / indoor
environmental quality, end of life
provisions / recyclability

Local sourcing, PVC minimisation, indoor
environmental quality / formaldehyde
minimisation

Natural resource management, emissions
(stormwater and sewage)


Indoor environmental quality, greenhouse
gas emissions




Indoor environmental quality, natural
resource management, greenhouse
emissions




WOL costing for ESD initiatives in DBC v1 4Sep2006
Local ecology, stormwater emissions (site
damage and downstream impacts)




WOL costing for ESD initiatives in DBC v1 4Sep2006
WOL costing for ESD initiatives in DBC v1 4Sep2006
WOL costing for ESD initiatives in DBC v1 4Sep2006
WOL costing for ESD initiatives in DBC v1 4Sep2006
WOL costing for ESD initiatives in DBC v1 4Sep2006
WOL costing for ESD initiatives in DBC v1 4Sep2006
WOL costing for ESD initiatives in DBC v1 4Sep2006
WOL costing for ESD initiatives in DBC v1 4Sep2006
WOL costing for ESD initiatives in DBC v1 4Sep2006
WOL costing for ESD initiatives in DBC v1 4Sep2006
       Sample WOL Cost Comparison (simplified format)
                        Investigation of three lighting system alternatives


       ITEM / OPTION:                 Standard Lighting System
       Description:                   lighting system with minimum specialist switching.



       NON-DISCOUNTED CASHFLOW


       SECTION            Year 0         Year 1         Year 2          Year 3         Year 4         Year 5         Year 6       Year 7       Year 8       Year 9       Year 10    Year 11    Year 12    Year 13    Year 14    Year 15    Year 16    Year 17    Year 18    Year 19    Year 20    Year 21    Year 22    Year 23    Year 24    Year 25    TOTAL

       Capital Cost         100,000           -               -              -              -              -              -           -            -            -                        -          -          -          -          -          -          -          -          -       50,000        -          -          -          -          -     150,000
       Recurrent                           10,000          10,000         10,000         10,000         10,000         10,000      10,000       10,000       10,000        10,000     10,000     10,000     10,000     10,000     10,000     10,000     10,000     10,000     10,000     10,000     10,000     10,000     10,000     10,000     10,000   250,000
       Others (Residual Value)                                                                                                                                                                                                                                                                                                                               -
        NET COST           100,000         10,000          10,000         10,000         10,000         10,000         10,000      10,000       10,000       10,000        10,000     10,000     10,000     10,000     10,000     10,000     10,000     10,000     10,000     10,000     60,000     10,000     10,000     10,000     10,000     10,000   400,000



       DISCOUNTED CASHFLOW                                8%         (Discount Rate)
                                -                 1              2               3              4              5              6            7            8            9         10         11         12         13         14         15         16         17         18         19         20         21         22         23         24         25

       SECTION            Year 0         Year 1         Year 2          Year 3         Year 4         Year 5         Year 6       Year 7       Year 8       Year 9       Year 10    Year 11    Year 12    Year 13    Year 14    Year 15    Year 16    Year 17    Year 18    Year 19    Year 20    Year 21    Year 22    Year 23    Year 24    Year 25    TOTAL

       Capital Cost        100,000             -              -              -               -             -              -            -            -            -            -          -          -          -          -          -          -          -          -          -       10,727        -          -          -          -          -     110,727
       Recurrent               -             9,259          8,573          7,938           7,350         6,806          6,302        5,835        5,403        5,002        4,632      4,289      3,971      3,677      3,405      3,152      2,919      2,703      2,502      2,317      2,145      1,987      1,839      1,703      1,577      1,460   106,748
       Others                  -               -              -              -               -             -              -            -            -            -            -          -          -          -          -          -          -          -          -          -          -          -          -          -          -          -         -

        NET COST           100,000           9,259          8,573          7,938           7,350         6,806          6,302        5,835        5,403        5,002        4,632      4,289      3,971      3,677      3,405      3,152      2,919      2,703      2,502      2,317     12,873      1,987      1,839      1,703      1,577      1,460   217,475




       ITEM / OPTION:                 Standard lighting system with control switching
       Description:                   lighting system with control switching such as light sensors



       NON-DISCOUNTED CASHFLOW


       SECTION            Year 0         Year 1         Year 2          Year 3         Year 4         Year 5         Year 6       Year 7       Year 8       Year 9       Year 10    Year 11    Year 12    Year 13    Year 14    Year 15    Year 16    Year 17    Year 18    Year 19    Year 20    Year 21    Year 22    Year 23    Year 24    Year 25    TOTAL

       Capital Cost        110,000             -              -              -               -             -              -            -            -            -            -          -          -          -          -          -          -          -          -          -       50,000        -          -          -          -          -     160,000
       Recurrent               -             8,500          8,500          8,500           8,500         8,500          8,500        8,500        8,500        8,500        8,500      8,500      8,500      8,500      8,500      8,500      8,500      8,500      8,500      8,500      8,500      8,500      8,500      8,500      8,500      8,500   212,500
       Others                                                                                                                                                                                                                                                                                                                                                -
        NET COST           110,000           8,500          8,500          8,500           8,500         8,500          8,500        8,500        8,500        8,500        8,500      8,500      8,500      8,500      8,500      8,500      8,500      8,500      8,500      8,500     58,500      8,500      8,500      8,500      8,500      8,500   372,500


       DISCOUNTED CASHFLOW                                8%         (Discount Rate)
                                -                 1              2               3              4              5              6            7            8            9         10         11         12         13         14         15         16         17         18         19         20         21         22         23         24         25

       SECTION            Year 0         Year 1         Year 2          Year 3         Year 4         Year 5         Year 6       Year 7       Year 8       Year 9       Year 10    Year 11    Year 12    Year 13    Year 14    Year 15    Year 16    Year 17    Year 18    Year 19    Year 20    Year 21    Year 22    Year 23    Year 24    Year 25    TOTAL

       Capital Cost        110,000             -              -              -               -             -              -            -            -            -            -          -          -          -          -          -          -          -          -          -       10,727        -          -          -          -          -     120,727
       Recurrent               -             7,870          7,287          6,748           6,248         5,785          5,356        4,960        4,592        4,252        3,937      3,646      3,375      3,125      2,894      2,680      2,481      2,297      2,127      1,970      1,824      1,689      1,563      1,448      1,340      1,241    90,736
       Others                  -               -              -              -               -             -              -            -            -            -            -          -          -          -          -          -          -          -          -          -          -          -          -          -          -          -         -

        NET COST           110,000           7,870          7,287          6,748           6,248         5,785          5,356        4,960        4,592        4,252        3,937      3,646      3,375      3,125      2,894      2,680      2,481      2,297      2,127      1,970     12,551      1,689      1,563      1,448      1,340      1,241   211,463



       ITEM / OPTION:                 High Technology Lighting and Control System
       Description:                   High technology light fitting with special lighting control and auto dimmer system.



       NON-DISCOUNTED CASHFLOW


       SECTION            Year 0         Year 1         Year 2          Year 3         Year 4         Year 5         Year 6       Year 7       Year 8       Year 9       Year 10    Year 11    Year 12    Year 13    Year 14    Year 15    Year 16    Year 17    Year 18    Year 19    Year 20    Year 21    Year 22    Year 23    Year 24    Year 25    TOTAL
       Capital Cost        125,000             -              -              -               -             -              -            -            -            -            -       34,000        -          -          -                     -          -          -          -       30,000        -          -          -          -          -     189,000
       Recurrent               -             7,200          7,200          7,200           7,200         7,200          7,200        7,200        7,200        7,200        7,200      7,200      7,200      7,200      7,200      7,200      7,200      7,200      7,200      7,200      7,200      7,200      7,200      7,200      7,200      7,200   180,000
       Others                                                                                                                                                                                                                                                                                                                                                -
        NET COST           125,000           7,200          7,200          7,200           7,200         7,200          7,200        7,200        7,200        7,200        7,200     41,200      7,200      7,200      7,200      7,200      7,200      7,200      7,200      7,200     37,200      7,200      7,200      7,200      7,200      7,200   369,000


       DISCOUNTED CASHFLOW                                8%         (Discount Rate)
                                -                 1              2               3              4              5              6            7            8            9         10         11         12         13         14         15         16         17         18         19         20         21         22         23         24         25

       SECTION            Year 0         Year 1         Year 2          Year 3         Year 4         Year 5         Year 6       Year 7       Year 8       Year 9       Year 10    Year 11    Year 12    Year 13    Year 14    Year 15    Year 16    Year 17    Year 18    Year 19    Year 20    Year 21    Year 22    Year 23    Year 24    Year 25    TOTAL

       Capital Cost        125,000             -              -              -               -             -              -            -            -            -            -       14,582        -          -          -          -          -          -          -          -        6,436        -          -          -          -          -     146,018
       Recurrent               -             6,667          6,173          5,716           5,292         4,900          4,537        4,201        3,890        3,602        3,335      3,088      2,859      2,647      2,451      2,270      2,102      1,946      1,802      1,668      1,545      1,430      1,324      1,226      1,135      1,051    76,858
       Others                  -               -              -              -               -             -              -            -            -            -            -          -          -          -          -          -          -          -          -          -          -          -          -          -          -          -         -

        NET COST           125,000           6,667          6,173          5,716           5,292         4,900          4,537        4,201        3,890        3,602        3,335     17,670      2,859      2,647      2,451      2,270      2,102      1,946      1,802      1,668      7,981      1,430      1,324      1,226      1,135      1,051   222,877




       Notes:
       1. Cost escalation was excluded in this WOL analysis.




WOL costing for ESD initiatives in DBC v1 4Sep2006
       Sample WOL Cost Comparison (simplified format)
       2. Breakdown of capital costs, recurrent costs and others should be annotated to provide transparency in the assumptions and calculations. Eg. additional capital expenditure is shown in Year 20, reflecting the effective life of the system being considered.

       3. Note that the second option provides the best financial benefit; however, in this simplified example, the benefits that may accrue from reduced heat load from the lighting system and its
       impact on the HVAC plant should be considered. Additionally, non-financial determinants such as indoor environmental quality and greenhouse gas emissions should be taken into account
       when comparing the systems to determine overall benefits of each option.




WOL costing for ESD initiatives in DBC v1 4Sep2006

				
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