Lecture no21 life cycle cost analysis

Life-Cycle Cost AnalysisLecture No... Why Life-Cycle Cost LCC Analysis?Why?. o Option B: Trim the pump impeller to reduce the pressure.. o Option C: Install a variable-frequency Sket

Life-Cycle Cost Analysis

Lecture No 21 Chapter 6 Contemporary Engineering Economics

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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

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

Stages of Life-Cycle Cost

Example 6.10: Pumping System with a Problem Valve

Decision Problem :

Fixing a pumping system

with a faulty valve.

Design options :

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

Sketch of a Pumping System

in Which the Control Valve Fails

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

Life-Cycle Cost Elements

Cost Comparison for Options A–D

LCC Calculation for Option A

Comparison of LCC for Options A–D