Traditionally, public procurers favour products and services that have the lowest purchase price. However, if usage costs (such as energy consumption) are also considered, energy efficient models and construction projects often prove cheaper over the lifetime, as well as reducing CO2 emissions.
Life-cycle Costing (LCC) is a powerful method for assessing the true cost of different options over the lifetime to ensure that public money is spent most wisely.
TOOL 2: Life-Cycle Cost Analysis Tool – this tool allows you to compare the life-cycle costs of different products by analysing the expenses which are not usually factored into initial cost comparisons. These include energy and water consumption, maintenance and replacements. In addition, the LCCA Tool allows you to compare the CO2 impacts of different products.
The tool is aimed at procurement and/or energy management staff and requires very little technical knowledge. It has three elements:
- The tool itself – an Excel based spreadsheet in which you can enter the necessary information to make a reliable cost comparison. To download the tool click here (xls)
- A basic PowerPoint introduction on How to use the LCCA Tool. Use the "Notes page" function to view accompanying information. To download the presentation click here (ppt)
- An LCC Guide for Senior Level Staff – a PowerPoint presentation that focuses on the benefits of Life-Cycle Costing, aimed at informing/convincing senior administrative and political staff. It is deliberately short and simple, recognising the time limitations of the target audience. The presentation is likely to be used by a proponent of Life-Cycle Costing, such as someone involved in developing the sustainable procurement policy, or by someone with responsibility for energy management. To download the presentation click here (pdf)