What is lifecycle cost?
Every cost of an asset over its whole life — bought, installed, run, maintained, renewed and disposed of — counted and compared, not just the price tag.
Lifecycle cost is the total cost of an asset over its whole life, not just the purchase price. It adds up acquisition and installation, then operation, maintenance, repair and renewal, and finally removal and disposal.
Options are costed over the same period and scope so they can be compared fairly, and actual costs are tracked against the estimate and fed back into planning. A price-only view means hidden costs, poor value and badly timed spending.
- Scope. Define the asset or system, the study period and which costs are included.
- Identify. List the cost elements: buy and install, operate, maintain, renew and dispose.
- Estimate. Price each element, with quantities, rates, timing and written assumptions.
- Compare. Total each option over the same period and weigh the result with risk and performance.
- Track. Log actual costs from work records and set them against the estimate.
- Review. Explain the variances, update the assumptions and adjust the plans.
The whole-life cost of an asset, from acquisition to disposal, used to compare options and plan budgets.
Only the initial cost of buying the item, which is one part of the lifecycle cost and often not the largest.
Frequently Asked Questions
Q1What is lifecycle cost in airfield ground lighting?
The total cost of an AGL asset or system over its whole life, from acquisition and installation through operation, maintenance, repair and renewal to removal and disposal. It is used to compare options fairly and to plan budgets, instead of looking only at the purchase price.
Q2Which costs are included in lifecycle cost?
Typically acquisition, design and installation, commissioning, energy and operation, inspection and maintenance, repairs and spares, downtime or disruption where it can be valued, renewal or upgrade, and decommissioning and disposal, less any recovery value. The scope is agreed before the calculation starts.
Q3Why is the cheapest purchase not always the cheapest option?
A low purchase price can come with higher energy use, more frequent maintenance, shorter life or costly spares. Over the full period these can outweigh the initial saving, which is why options are compared on whole-life cost as well as on price.
Q4How is lifecycle cost used to compare options?
Each option is costed over the same period and with the same scope, often using present-value methods so that costs at different times can be compared. The results are then weighed alongside performance, safety, operational impact and risk, not on cost alone.
Q5What data is needed to estimate lifecycle cost?
Purchase and installation prices, expected life, energy and maintenance needs, failure rates and repair costs, spares and warranty terms, and disposal costs. Asset records, maintenance history and supplier information provide the evidence, and assumptions are written down so they can be checked.
Q6How does lifecycle cost link to the rest of the asset lifecycle?
Every stage adds cost and produces data about it. Actual costs from maintenance, repair, spares and warranty claims are tracked against the estimate and fed back into asset planning, so future decisions on repair, refurbishment, upgrade or replacement rest on real figures.
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