Life-Cycle Cost Benefit Analysis
Total cost of ownership (TCO) is a series of financial estimates intended to help buyers and owners determine the direct and indirect costs of a product or system. It goes beyond the initial ‘simple payback’ or ‘breakeven’ cycle time and cost, and includes a variety of real costs of doing business, while it also considers financial incentives available for enticing the owners to go forward with a respective project. Incentives and other variables include tax credits, rebates, accelerated depreciation, etc.
A TCO or life-cycle cost benefit analysis includes total cost of acquisition and operating costs, and it’s used to gauge the viability of any capital investment. Our organization uses it with our clients as an equipment/process comparison tool, as it directly relates to an enterprise's total cost of a system asset and its operations across all projects and processes. Always, we provide an exact model of the value of a total system investment – in terms of profitability - over time.
U.S. Power takes pride in its comprehensive approach to modeling and measuring the total cost of ownership for any of its projects, and routinely presents the data in clean, interesting, and easy-to-understand ways for its clients to review and analyze.
The company works very hard to align goals, processes, and programs at the corporate level to support our clients’ energy reduction goals during the procurement process and in day-to-day operations. Total cost of ownership and ongoing maintenance costs are highly important when considering energy efficiency solutions, but absent us, not all organizations take the long-term view on energy efficiency technology investments.