Using Lifecycle Cost Analysis for Best Project Value

Lifecycle cost analysis (LCCA) can be used as a tool for selecting alternatives that add the most value to a project. The methodology for implementing LCCA is described here In the chemical process industries (CPI), identifying optimum process designs challenges both process and cost engineers: the first must optimize the process in terms of throughput rate, process yield and product purity (among other factors), whereas the second are responsible for estimating the costs of the different design alternatives to allow assessing their impact against the business case. Their close interaction from the beginning of the project is key, as the ability to impact cost and functional capabilities is highest in the project’s early stages, where the cost of design changes is lowest [1]. The types of choices the design team takes throughout project development usually include: location, capacity, technology and process configuration (typically at the visualization/conceptual phase), equipment types and specifications, layout definition, utilities (typically at the conceptual/ basic engineering phase), vendor selection, construction methods, logistics and general planning (typically at the detail engineering/procurement/construction phase),…