ASTM E917-17(2023) PDF

Overview

ASTM E917-17(2023), "Standard Practice for Measuring Life-Cycle Costs of Buildings and Building Systems," provides a comprehensive methodology for conducting life-cycle cost (LCC) analysis of buildings and their systems. Developed by ASTM International in adherence to recognized global standardization principles, this practice enables building owners, managers, architects, and engineers to evaluate and compare the economic performance of design alternatives or system specifications over a designated study period.

Life-cycle cost analysis sums all relevant expenses associated with owning, operating, maintaining, and disposing of a building or system, either in present-value or annual-value terms. By accounting for both initial investments and future costs, LCC assists in making financially sound choices and optimizing facility management.

Key Topics

• Life-Cycle Cost (LCC) Analysis: An economic evaluation technique for comparing competing building designs or systems with similar functional objectives.
• Applicable Costs: LCC calculations include initial investment, design, construction, installation, operation, maintenance, repair, replacement, and disposal costs.
• Present-Value and Annual-Value Terms: Costs can be measured using present-value (discounted to base time) or annual-value (converted to uniform yearly amounts).
• Study Period: Selection of an appropriate analysis timeframe that reflects ownership duration, system service life, or policy guidance.
• Inflation and Discounting: Includes consideration of general price inflation and selection of suitable discount rates reflecting the time value of money.
• Uncertainty and Risk: Techniques such as sensitivity analysis and Monte Carlo simulations are recommended to address input uncertainty and project risk.
• Non-Quantifiable Factors: Guidance is provided for incorporating qualitative factors (e.g., aesthetics or comfort) that may influence decision-making but are difficult to price.
• Alternative Comparison: Requires consistent assumptions and periods across alternatives for valid economic comparison.
• "Do Nothing" Baseline: For nonessential projects, comparison against retaining existing conditions ensures valid cost effectiveness evaluation.

Applications

ASTM E917-17(2023) is widely used for:

• Selecting Building Systems: Comparing HVAC, window, roofing, or other system options over their operational life to identify the most cost-effective choice.
• Sustainable and Efficient Design: Determining whether higher up-front investments (e.g., energy-efficient technologies) are offset by lower operational costs.
• Capital Planning: Assisting owners and facility managers in making informed decisions on renovations, replacements, or new construction based on long-term cost impacts.
• Budgeting and Forecasting: Providing a structured foundation for financial planning, capital allocation, and return-on-investment analysis.
• Public and Institutional Policy: Supporting government and large institution decision-making processes that require justification of building investments using comprehensive economic criteria.
• Risk-Informed Decisions: Addressing the uncertainty and variability in future costs, operating conditions, or economic factors through robust analysis methods.

Related Standards

The LCC method in ASTM E917 is closely linked to other ASTM standards and guides on building economics and financial assessment, including:

• ASTM E631: Terminology of Building Constructions
• ASTM E833: Terminology of Building Economics
• ASTM E964: Measuring Benefit-to-Cost and Savings-to-Investment Ratios
• ASTM E1057: Measuring Internal Rate of Return
• ASTM E1074: Measuring Net Benefits and Net Savings
• ASTM E1121: Measuring Payback for Investments
• ASTM E1185: Selecting Economic Methods for Evaluating Investments
• ASTM E1369: Techniques for Treating Uncertainty and Risk in Economic Evaluation
• ASTM E1765: Applying Analytical Hierarchy Process to Multi-Attribute Decision Analysis
• ASTM E1946: Measuring Cost Risk of Buildings and Building Systems

These standards, in conjunction with ASTM E917, provide a robust toolkit for conducting comprehensive financial analyses throughout the building life cycle.

By following ASTM E917-17(2023), stakeholders in the construction and building management sectors can make economically sound, transparent, and justifiable decisions, ensuring optimized investment and operational strategies over the lifespan of building assets.