Life-cycle Cost-benefit Analysis Research Articles

Risk-based life cycle cost–benefit analysis for progressive collapse design of RC frame structures

Progressive structural collapse is a typical low-probability high-consequence event. Progressive collapse design can effectively improve the robustness of structures against accidental local damage and reduce the probability of collapse. However, progressive collapse design also increases the construction cost of buildings. Hence, it is necessary to conduct cost-benefit analyses for the progressive collapse design of building structures. This study first designs a reinforced concrete (RC) frame based on a progressive collapse design program that simultaneously optimizes material consumption and structural resistance. Then, the structural failure probability is quantified using an alternative path (AP) method-based fragility analysis that considers the structural uncertainties. Based on this, the life cycle costs and benefits of the structure designed with different design load factors are investigated. A four-story RC frame is used as an example. By considering the time value of money and threat probability, the break-even points and optimized design load factors for the progressive collapse design of the RC frame are analyzed. These research outcomes can help promote progressive collapse design in engineering practice and provide references for proposing scientific and reasonable design load factors.

Economic assessment of nature-based solutions to reduce flood risk and enhance co-benefits

Flooding is expected to increase due to climate change, urbanisation, and land use change. To address this issue, Nature-Based Solutions (NBSs) are often adopted as innovative and sustainable flood risk management methods. Besides the flood risk reduction benefits, NBSs offer co-benefits for the environment and society. However, these co-benefits are rarely considered in flood risk management due to the inherent complexities of incorporating them into economic assessments. This research addresses this gap by developing a comprehensive methodology that integrates the monetary analysis of co-benefits with flood risk reduction in economic assessments. In doing so, it aspires to provide a more holistic view of the impact of NBS in flood risk management. The assessment employs a framework based on life-cycle cost-benefit analysis, offering a systematic and transparent assessment of both costs and benefits over time supported by key indicators like net present value and benefit cost ratio. The methodology has been applied to the Tamnava basin in Serbia, where significant flooding occurred in 2014 and 2020. The methodology offers valuable insights for practitioners, researchers, and planners seeking to assess the co-benefits of NBS and integrate them into economic assessments. The results show that when considering flood risk reduction alone, all considered measures have higher costs than the benefits derived from avoiding flood damage. However, when incorporating co-benefits, several NBS have a net positive economic impact, including afforestation/reforestation and retention ponds with cost-benefit ratios of 3.5 and 5.6 respectively. This suggests that incorporating co-benefits into economic assessments can significantly increase the overall economic efficiency and viability of NBS.

Life cycle cost analysis of seismic retrofit policy at the city scale

Many early-developed cities are grappling with aging building environments, characterized by chronic deterioration of structures. The consequent rise in seismic risk and loss has spurred governments to promote relevant disaster mitigation plans. In the process of urban renewal or the retrofit of dilapidated buildings, it is crucial to consider economic feasibility and the impact of policies. To support decision-making, this study aims to develop a framework for evaluating different seismic reinforcement strategies at a city level using a life cycle cost-benefit analysis. The reduction of seismic loss by a certain reinforcement strategy was assessed through the capacity spectrum method, fragility curves, and probabilistic seismic hazard analysis. Construction costs and reinforcement costs were adapted from historical data. The Equivalent Uniform Annual Cost Method was also adopted to analyze the overall life cycle cost of the target buildings based on the chosen reinforcement strategy. The researchers of this study analyzed the private buildings in Taipei City, Taiwan, to demonstrate the proposed method. The priority for reinforcement was determined based on various vulnerability measures of the buildings. Six different reinforcement strategies were compared in the case study. The results revealed that the strategies that can properly exploit soft story reinforcement are more economically attractive in terms of life cycle cost. However, a decline in marginal utility was detected. The results also showed that the proposed method could provide an objective reference for determining the priority of reinforcement plans and effectively mitigate the impact of earthquakes on the community. The findings of this research can assist stakeholders in earthquake disaster preparedness and mitigation.

Unified life-cycle cost–benefit analysis framework and critical review for sustainable retrofit of Canada's existing buildings using mass timber

This paper investigates the possibilities and challenges of using mass timber as a sustainable alternative for retrofitting existing buildings in Canada. To create the knowledge foundation on which to devise a holistic framework tailored to the specific characteristics of Canada's built environment, a detailed analysis of the types, geographical distribution, structural, and energy features of the local building stock is first presented. Then, previous strategies for enhancing and upgrading existing buildings with engineered timber are reviewed, classified, and evaluated. Finally, to explore economic and environmental implications, a detailed assessment of available life-cycle cost–benefit analysis approaches is conducted alongside their adaptation to Canada's building context. The findings of this paper can inform policymakers, builders, and designers in developing more sustainable building retrofit practices, design, and regulations, in line with Canada's efforts toward net zero emissions.

Holistic Life-cycle Cost-benefit Analysis of Green Buildings: A China Case Study

Holistic Life-cycle Cost-benefit Analysis of Green Buildings: A China Case Study

Energy efficiency strategies for Brazilian social housing considering a life cycle perspective: Optimisation between thermal autonomy, energy consumption and costs

This study aims to establish optimal cases for energy-efficient social housing projects in Brazil, considering a life cycle cost-benefit analysis. Energy efficiency measures for the building envelope were evaluated in representative single-family and multifamily typology projects for the lower-income sector, considering thermal autonomy, energy consumption and cost indicators. The measures estimated in terms of macrocomponents allowed for comparative evaluation and association with costs. Cases were simulated in EnergyPlus to obtain the building’s expected operational consumption. With the macrocomponents and simulation data, Python routines were used to compute results for each proposed combination. Optimal cases that present high thermal performance in the national standard (NBR 15575) with cost-effectiveness, offering guidelines for projects in the 8 Brazilian bioclimatic zones, were established. Results presented in more detail for bioclimatic zone 8 showed optimal cases, with the increase in the percentage of hours of thermal autonomy reaching 65% to 71%, whereas that of a typical building was 30%, while life cycle cost related to the envelope showed reductions of up to 22%, even with higher initial costs. This study served as a basis for the new Brazilian policy proposed by the National Housing Office (SNH) to develop new social housing projects.

Modelling Approaches of Life Cycle Cost–Benefit Analysis of Road Infrastructure: A Critical Review and Future Directions

Cost–benefit analysis (CBA) is considered an effective evaluation method for fostering optimal decision making and ranking of road infrastructures over decades. This paper introduces a comprehensive systematic literature review focusing on CBA’s methodological perspective for identifying its current modelling approaches and scrutinizing their key features and encompassed tools. Fifty-six relevant studies were extracted from Web of Science, Scopus and Google Scholar from 2005 until 2020. Initially, the bibliometric analysis presents an overall illustration of the most significant CBA concepts. The descriptive statistics determined eight distinct modelling categories used for CBA implementation, each encompassing three different modelling approaches for capturing the data risk assessment (deterministic or probabilistic), CBA’s parameters interactive behavior (static or dynamic) and the considered economies (microeconomic or macroeconomic). In-depth content analysis led to the interpretation of the current status of extant models and the identification of three main knowledge gaps: the absence of the CBA’s inputs updating into a probabilistic environment, the deficiency of a dynamic interdependent framework and the necessity of homogenous cost datasets for road projects. Future research directions and a conceptual framework for modelling CBA into a microeconomic, probabilistic and dynamic environment are proposed providing decision-makers with new avenues for more reliable CBA modelling.

Eco-compensation quantification of sustainable food waste management alternatives based on economic and environmental life cycle cost-benefit assessment

Eco-compensation can promote sustainable food waste management alternatives. However, a comprehensive quantification method is not yet available. This study proposed a method to quantify the eco-compensation for food waste management through environmental and economic life cycle cost-benefit analysis. This method was tested with four food waste management alternatives in Suzhou, China, including Biological Drying + Aerobic Composting (BDAC), Anaerobic Fermentation (AF), Anaerobic Fermentation + Digestate Composting (AFDC), and INcineration (IN). According to the method, the environmental benefits (net positive externalities) and the economic loss (net negative internalities) could provide references to the government and the food waste producers (polluters), respectively, as eco-compensations for food waste disposal plants. The results suggest that AFDC (with higher energy and material recovery level) was the most environmentally and economically viable food waste management alternative. The AFDC exhibited the highest net environmental benefits (CNY t−1) of 844, followed by BDAC (596), IN (449), and AF (356). The net economic profit (CNY t−1) without subsidy of AFDC (55) was the highest, followed by IN (−5), AF (−27), and BDAC (−422). The total values of eco-compensations by the government and the polluters were 564, 101, 0, and 57 CNY t−1 for BDAC, AF, AFDC, and IN, respectively. The proposed methods for food waste disposal management can promote the effective and efficient use of government funds for the sustainable development of the food waste management sector.

Indirect estimation of willingness to pay for energy technology adoption

Adopting energy-efficient and clean technologies is key to climate change mitigation and meeting long-term sustainability goals because they significantly reduce energy consumption and related carbon emissions. Understanding existing barriers and drivers for the adoption of these energy-efficient and clean technologies will be crucial to meeting ambitious national energy and emissions targets, and the customers’ willingness to pay (WTP) is a key factor in understanding the potential for scaling-up adoption. However, in practice, commonly-used WTP estimation methods such as survey or purchase experiments are not always practical or feasible due to budget, time, labor or data constraints. This study proposes a new constrained optimization-based indirect estimation of WTP for energy technology adoption using customers’ implicit life-cycle cost-benefit analysis and market data. The empirical probability distribution of WTP is estimated using the Monte Carlo methods. This new indirect estimation method provides a deeper understanding of the barriers and customers’ willingness to adopt high efficiency and clean energy technologies, and informs the development of supporting policies and programs needed to accelerate market adoption.

Energy generation from palm oil mill effluent: A life cycle cost-benefit analysis and policy insights

Malaysia's renewable energy policies do not cover production from waste, including the generation of biogas from palm oil mill effluent. This paper combines life cycle cost-benefit analysis (LCCBA) and the analytical hierarchy process (AHP) to provide new insights into costs and benefits of technologies over the life cycles, and on the basis of this information, asks experts to rank different options to enhance policy. The results show that the continuous stirred tank reactor has a higher LCC of 0.63 Million USD/year, compared to a LCC value of 0.55 Million USD/year for the covered lagoon bio-digester. In terms of cost-benefit, the continuous stirred tank reactor has a higher net present value of 0.46 Million USD/year, higher return on investment of 10.11% and a shorter payback period of 9.9 years compared to the covered lagoon bio-digester system, which has a net present value of 0.22 Million USD/year, return on investment of 7.79% and a payback period of 12.8 years. The continuous stirred tank reactor system therefore emerges as more economically feasible compared to the covered lagoon bio-digester system. On providing this information to experts using AHP, the three top ranked policy options emerged as: i) providing detailed environmental guidelines, ii) standardising technical guidelines for biogas installation and iii) covering the open pond wall using lining. Economic insights and policy opportunities based on this research can be used to inform policy decision making in multiple contexts where biogas plant projects are under consideration, in both Malaysia and globally.

A Life-cycle Cost-benefit Analysis for Rooftop Photovoltaic Systems in Lightweight Steel-structured Industrial Buildings

There is a widespread consensus that energy efficiency of buildings is an essential component of sustainable development and several kinds of renewable energy technologies have been widely used to achieve this sustainable goal. As a rapidly developing country, China’s manufacturing industry still occupies a prominent position, with a large number of industrial buildings that are also a crucial part of urban planning. Compared with multi-story and high-rise commercial buildings, large industrial sheds have a much more usable roof area, where rooftop photovoltaic (PV) systems are increasingly used. However, due to the small structural margins of the lightweight steel-structured (LSS) industrial buildings and the large initial investment of the thin-film PV system, few case studies are available for this kind of industrial buildings. In this research, three representative cities in China, with varying levels of solar radiation availability, are selected as typical external design factors. Taking a typical LSS industrial building with an added thin-film rooftop PV system as an example, a life-cycle cost-benefit analysis is conducted from environmental and economic aspects. The results of the analysis demonstrate the effectiveness of the rooftop thin-film PV system as a means to increase the energy efficiency of the LSS industrial buildings.

Life cycle cost-benefit analysis of refrigerant replacement based on experience from a supermarket project

The Kigali Amendment to the Montreal protocol calls for the phase-down of hydrofluorocarbons (HFC). With natural refrigerant gaining momentum worldwide, it is important to ascertain if the use of natural refrigerant reduce greenhouse gas emissions from refrigeration when the broader energy system in a cost-effective manner is considered. This study employs a generic process chain analysis framework to examine the life cycle costs and benefits of refrigerant replacement. The case study data are collected from a supermarket in China which has recently changed from a R22 system to a R134A-R744 system. There are three key findings from this study. First, the values of the life cycle greenhouse gas abatement costs can be significantly influenced by the costs and emissions due to electricity usage. Under a 15% discount rate, the reference values of the greenhouse gas abatement cost are found to be 207.28 and 1.40 $/t-CO2e with and without the costs and emissions due to electricity use respectively. Next, under the current state of technology development, cost reductions should be prioritised for natural refrigerant based system to become commercially attractive. Last and most important, current natural refrigerant based systems can only be suitable replacement of aging systems and/or systems approaching obsolescence.

A feasibility study on integrating large-scale battery energy storage systems with combined cycle power generation – Setting the bottom line

Strong attention has been given to the costs and benefits of integrating battery energy storage systems (BESS) with intermittent renewable energy systems. What's neglected is the feasibility of integrating BESS into the existing fossil-dominated power generation system to achieve economic and environmental objectives. In response, a life cycle cost-benefit analysis method is introduced in this study taking into consideration three types of battery technologies, namely, vanadium redox flow battery, zinc bromine flow battery, and lithium-iron-phosphate battery. The objective is to evaluate the life cycle carbon emissions and cost of electricity production by combined cycle power generation with grid-connected BESS. Findings from the Singapore case study suggest a potential 3–5% reduction in the life cycle carbon emission factors which could translate to a cumulative carbon emission reduction of 9–16 million tonnes from 2018 to 2030 from electricity generation. Grid-connected BESS could reduce the levelized cost of electricity by 4–7%. A synergistic planning of CCGT and BESS could theoretically reduce the system level power generation capacity by 26% albeit a potential increase in the overall capital cost at the current cost of batteries. The projected battery cost reduction is critical in improving the feasibility of large-scale deployment.

Valuation of Energy Storage at User Side Considering Total Life Cycle

With the continuous progress of energy storage technology and the substantial reduction of cost, as well as the development of China’s energy Internet, customer-side distributed energy storage has been applied more and more widely. Considering the customer-side distributed energy storage which takes the grid-connected “distributed solar + energy storage” as the main application mode, a distributed energy storage evaluation model based on double-granularity optimal operation strategy is proposed, which is built on life-cycle cost-benefit analysis model for customer-side distributed energy storage considering its operation optimization in advance. Taking large industrial and business consumers in one province in China as an example, the sensitivity analysis of customer-side distributed energy storage value is taken under different load characteristics, price policies, energy costs and energy storage technology characteristics, judging the customer-side distributed energy storage trends and potential of further development.

Effects of design parameters on rooftop photovoltaic economics in the urban environment: a case study in Melbourne, Australia

Many researchers found high potential of adopting building photovoltaic (PV) systems in urban areas, especially on building rooftop, to improve the sustainability of urban environment. However, the optimal energy output performance and economic benefit of the PV system are affected by the usable roof area, PV array layout, and shading effect considering high city density. This study aims to understand the effects of these design parameters in the urban environment of rooftop PV’s economic performance. This study carries out a case study in the urban area of Melbourne with 90 PV designs under three shading conditions to generate 270 scenarios. Through a lifecycle cost-benefit analysis, including net present value (NPV), NPV per kW, internal return rate (IRR), and payback year, the results can help in developing a comprehensive understanding of the economic performance of rooftop PV designs that cover most of the urban areas of Melbourne. The optimal PV design scenarios for the urban environment are identified, thereby providing investors and industry professionals with useful information on value-for-money PV design. Meanwhile, the maximum shading loss that makes the PV systems financially unfeasible is investigated, and design scenarios with greatest ability to sustain the shading effect are identified. This research can also support the policy makers’ decision on the development and deployment of the roof PV systems in urban planning.

Life-Cycle cost-benefit analysis of Bridge deck de-icing using geothermal heat pump system: A case study of North Texas

Transportation infrastructures suffer major damage from ice and snow each year, negatively affecting the U.S. economy. Bridges, a key element of the transportation network, are the most vulnerable to impairment from ice and snow. The conventional snow and ice removal system (CSRS) is not a satisfactory solution, as it causes additional problems relating to the acceleration of bridge deck corrosion, motorist safety, travel delays, and environmental damages. In an attempt to provide a sustainable, economically viable alternative, this research performed a scenario-based life-cycle cost-benefit analysis (LCCBA) of the geothermal heat pump de-icing system (GHDS). The results of the analysis show that the benefits of the GHDS outweigh its cost. In addition, the output of a sensitivity analysis, using the Monte Carlo Simulation (MCS), indicates that traffic flow enhancement is the most dominant variable affecting the overall result. For a daily traffic volume of 24,000 vehicles, the benefits are estimated to be 2.32 times greater than the costs, with 95% reliability. The analysis output demonstrates that the application of the GHDS is economically viable for bridges with a minimum daily traffic volume of 7000 vehicles.

Life cycle cost-benefit analysis of offshore wind energy under the climatic conditions in Southeast Asia – Setting the bottom-line for deployment

Offshore renewable energy resources are options to address a country’s energy and climate objectives without having to occupy vast amount of land space. Offshore wind power production, among the various offshore renewable options, has gained popularity albeit its dependence on the deployment location’s wind conditions, technical challenge in construction and grid connection, and potentially high capital cost. The wind conditions in Southeast Asia are generally much less favourable as compared to other parts of the world, but several economies in this region consider offshore wind energy as a long term solution to decarbonize the electricity sector and to diversify the source of electricity. There is thus a need to evaluate the true benefits of offshore wind energy under the region’s suboptimal climatic conditions. In response, this study employs the life cycle analysis approach to conduct a cost-benefit analysis of offshore wind energy in the context of Southeast Asia. Findings from study suggest that the cost of offshore wind energy remains high at the moment for Southeast Asia. The findings further contribute to the debate on offshore wind energy by setting the bottom-line for deployment under unfavourable climatic conditions in the tropical region and world-wide. However, offshore wind farm could still represent a plausible option through technology innovation in wind turbine designs and reductions in the cost of wind turbine and submarine power cable. As suggested in this study, there is potential for the cost of offshore wind energy to reach parity against onshore renewables such as solar energy in the context of Southeast Asia.

Innovative Energy Islands: Life-Cycle Cost-Benefit Analysis for Battery Energy Storage

Cities are concentrations of economic, social, and technical assets, which are fundamental to addressing climate change challenges. Renewable energy sources are growing fast in cities to mitigate greenhouse gas emissions in response to these challenges. In this transition urban decentralized energy shares technical and economic characteristics with energy islands. This is reflected in that island energy systems essentially operate off-grid which as a modus operandi can offer lessons to small-scale urban systems. With the expansion of urban areas, communities, especially small-scale ones, are sometimes further away from the main power infrastructure. Providing power supply to these communities would require significant investment to the existing power system, either to improve its grid infrastructure or power supply facilities. The energy islands have for some time now lent themselves to energy innovation including smart grid and battery storage applications. In this research we conceptualize that urban energy communities can be benefitted by knowledge transfer from energy islands in several fronts. We specifically put forward a life-cycle cost-benefit analysis model to evaluate the economics of battery storage system used in small communities from a life-cycle perspective. In this research we put forward a novel cost-benefit analysis model. Our results show that the inclusion of externalities can improve the economic value of battery systems significantly. Nevertheless, the economic performance is still largely dependent on several parameters, including capacity cost, discharging price, and charging cost. We conclude that existing electricity price structures (e.g., using household electricity price as a benchmark) struggle to guarantee sufficient economic returns except in very favorable circumstances; therefore, governmental support is deemed necessary.

Selection of the most suitable life extension strategy for ageing offshore assets using a life-cycle cost-benefit analysis approach

PurposeA substantial number of production assets in the offshore oil and gas industry are facing operation beyond their anticipated design life, thus necessitating a service life extension program in the future. Selection of the most suitable strategy among a wide range of potential options to extend the lifetime of equipment (e.g. re-using, reconditioning, remanufacturing, refurbishing and adding on safety/process control measures) remains a challenging task that involves several technical, economic and organizational complexities. In order to tackle this challenge, it is crucial to develop analytical tools and methods capable of evaluating and prioritizing end-of-life strategies with respect to their associated costs and quantifiable benefits. The paper aims to discuss these issues.Design/methodology/approachThis paper presents a life-cycle cost-benefit analysis approach to identify the most suitable life extension strategy for ageing offshore assets by taking into account all the capital, installation, operational, maintenance and risk expenditures during the extended phase of operation. The potential of the proposed methodology is demonstrated through a case study involving a three-phase separator vessel which was constructed in the mid-1970s.FindingsThe results from the application case indicate that the capital expenditure (CapEx) accounts for the largest portion of life cycle cost for the replacement strategy, while risk expenditure (RiskEx) is the major contributor to costs associated with life extension. A sensitivity analysis is also conducted to identify factors having the greatest impact on the optimum life extension solution, including oil price, production rate and money interest rate.Practical implicationsIn the past, the decisions about life extension or replacement of in-service equipment were often made in a qualitative way based on experience and judgment of engineers and inspectors. This study presents a “quantitative” framework to evaluate and compare the costs, benefits and risks associated with life extension strategies and subsequently to select the best strategy based on benefit/cost ratios.Originality/valueTo the best of authors’ knowledge, no studies before have applied life cycle assessment and cost-benefit analysis methods to prioritize the potential life extension strategies in the oil and gas industry sector. The proposed approach not only assists decision makers in selecting the most suitable life extension strategy but also helps duty holders reduce the costs corresponding to life extension execution.

Office building deep energy retrofit: life cycle cost benefit analyses using cash flow analysis and multiple benefits on project level

Deep energy retrofit (DER) of the existing building stock is a meaningful strategy to reduce fossil fuel consumption and CO2 emissions. However, the investment volumes required to undertake DER are enormous. In Europe, cumulative demand for DER is estimated at close to 1000 billion EUR until 2050. Public expenditures and political measures can help to stimulate and guide DER, but substantial private investments are required to achieve significant results. In this paper, we analyze the economic and financial implications for renovating an office building to the “Passive House” standard. This is achieved by applying a dynamic Life Cycle Cost & Benefit Analysis (LCCBA) to model the cash flows (CF). The model also includes an appraisal of debt and equity financing implications, and a multi-parameter sensitivity analysis to analyze impacts of input parameter deviations. In the second part of the paper, we use the “multiple project benefits” (MPB) concept to identify project-based co-benefits of DER (with a focus on productivity), to make the business case more attractive. Results show that the DER project cash flow over a 25-year period achieves a 21-year dynamic payback with an IRR of below 2%. Levelized Cost of Heat Savings is 100 EUR/MWh with a 70% capital expenditure and 15% interest cost share. The Loan Life Cover Ratio comes out to 1.2. To make the business case more attractive, pecuniary MPBs identified are increased rents, real estate values, (employee) productivity, maintenance costs, and CO2 savings, in addition to societal benefits. Compared to simpler economic modeling, the dynamic LCCBA cash flow model provides solid grounds not only for DER business case analysis, project structuring, and financial engineering, but also for policy design. CFs from future energy cost savings alone are often insufficient in convincing investors. However, they can co-finance DER investments substantially. Consideration of project level MPBs can offer meaningful monetary contributions, and also help to identify strategic allies for project implementation; however, the “split incentive” dilemma requires differentiation between tenants and different types of investors. Furthermore, the approach supports policy-makers to develop policy measures needed to achieve 2050 goals.