Life Cycle Cost Analysis

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Without an accurate estimate of asset life cycle cost, it’s difficult to manage a capital asset program and year-to-year operating and maintenance budgets. Absence of accurate projections of the future cost of energy usage, operating and maintenance costs also hampers creating a long-range capital replacement program.

To help you manage your capital asset program, Life Cycle Engineering, Inc. (LCE) can develop a comprehensive analysis of an existing or potential new asset or system and develop a projection of its Life Cycle Cost. The projected cost will include operating, consumables, energy and maintenance cost for the asset or system’s expected life time.

Scope of Services:

A qualified Reliability Engineer will evaluate up to three capital assets. This evaluation will project the annual operating cost of the three selected capital assets for the assets’ estimated useful life. The projected year-to-year costs will include all major classifications:

  • Operating cost, including staffing, indirect materials, direct materials and miscellaneou
  • Maintenance cost, including preventive, corrective, periodic replacement, overhauls, rebuilds and upgrades
  • Energy cost, including electrical, water, compressed air, etc
  • Training cost required to maintain adequate skill levels for operators and maintainers

The life cycle cost analysis on new assets will also include the front-end costs:

  • Design cost, including conceptual through detailed design
  • Procurement cost, including specification development, vendor evaluation, selection and acceptance testing
  • Installation costs associated with transportation and installation of a new asset
  • Commissioning costs required to start up and fully commission the asset, including procedure development, initial training, documentation, etc.


LCE will generate a formal document that will include the projected life cycle cost of up to three new or existing assets. The document will include the projected annual expenditures in each of the major cost classifications for the projected useful life of the asset.

The information provided in this deliverable can be used to develop annual production, maintenance, training and other budgets for the projected useful life of the asset. This will facilitate both the tactical (one year) and strategic (five year) business plan.

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For More Information on Life Cycle Cost Analysis

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