Approximate estimation of life cycle cost for waste treatment plants in the early planning stage

Abstract

As a solution for current environmental problems, resource recirculation cities have been emerging in the urban design sector. Waste treatment plants as a key factor of a resource recirculation city, are required to be optimized from environmental and economic perspectives. Life Cycle Cost (LCC) analysis works as an economic measurement for a plant’s entire life. LCC which considers operational benefits as well as total expenses, is meaningful as not only an evaluation tool but also a decision making support tool in the early planning phase. However, LCC estimation in early planning has not been studied. Conventional ways to estimate LCC need a vast amount of detailed data, so it takes a lot of time and effort. This study suggests a simplified methodology using Monte Carlo simulation and regression analysis to reduce time and effort to get sufficient data. The model created from the methodology can be used in the conceptual design phase to estimate LCC. The methodology is suggested in two steps. First, regression analysis is conducted to estimate cost components, such as construction costs and operation costs, using the relationship between costs and capacity in waste treatment plants. Second, Monte Carlo simulation is done using regression residuals distributions reflecting the uncertainty of costs. Once an approximate LCC estimation model is created, LCC range can be calculated with simple input data, such as capacity. In this paper, the suggested methodology is applied into three different categories in the field of waste treatment plants in Korea: economic assessment of incineration plants, LCC comparison of sewage treatment plants by process type, and sensitivity analysis for sewage treatment plants operation costs. Each LCC range estimation is presented with a 50% probability level. Economic assessments of incineration plants provide the possibility to have economic predominance. The result of the economic assessments shows that the break-even point fo...