You are here: 5.0 Management > Man 02 Life cycle cost and service life planning

Man 02 Life cycle cost and service life planning

(all buildings)

Number of credits available	Minimum standards
4	No

Aim

To deliver whole life value by encouraging the use of life cycle costing to improve design, specification, through-life maintenance and operation, and through the dissemination of capital cost reporting to promote economic sustainability.

Assessment criteria

This issue is split into three parts:

Elemental life cycle cost (2 credits)
Component level life cycle cost (1 credit)
Capital cost reporting (1 credit)

The following is required to demonstrate compliance:

Two credits - Elemental life cycle cost (LCC)

An outline, entire asset elemental LCCLife Cycle Cost plan has been carried out at the Concept Design stage together with any design option appraisals in line with 'Buildings and constructed assets – Service life planning – Part 5: Life cycle costing ISO 15686-5:2008.

The outline LCC plan:

2.a

Provides an indication of future replacement costs over a period of analysis as required by the client (e.g. 20, 30, 50 or 60 years)

2.b

Includes service life, maintenance and operation cost estimates.

Demonstrate, using appropriate examples provided by the design team, how the elemental LCC plan has been used to influence building and systems design, and specification to minimise life cycle costs and maximise critical value.

One credit - Component level LCC options appraisal

A component level LCC options appraisal has been developed by the end of Process Stage 4 (equivalent to Technical Design Stage) in line with ISO 15686-5:2008, and includes the following component types (where present):

4.a

Envelope, e.g. cladding, windows, or roofing

4.b

Services, e.g. heat source, cooling source or controls

4.c

Finishes, e.g. walls, floors or ceilings

4.d

External spaces, e.g. alternative hard landscaping, boundary protection.

Demonstrate, using appropriate examples provided by the design team, how the component level LCC options appraisal has been used to influence building and systems design, and specification to minimise life cycle costs and maximise critical value.

One credit - Capital cost reporting

Report the capital cost for the building , via the BREEAM Assessment Scoring and Reporting tool.

Checklists and tables

None.

Compliance notes

Ref	Terms	Description
Shell and core (non-residential and residential institutions only)
CN1	Applicable assessment criteria	Elemental life cycle cost, capital cost reporting and maintenance strategy, criteria 1 to 3 and 6 Both options: All assessment criteria relevant to the building type and function apply. Component level LCC plan, criteria 4 to 5 Both options: The plan must include all component types to be installed by the developer. Refer to Appendix D – Shell and core project assessments for a more detailed description of the shell and core assessment options.
Residential - Partially fitted and fully fitted
CN2	Applicable assessment criteria - Single and multiple dwellings	Both options: All criteria relevant to the building type and function apply. Refer to Appendix E – Applicability of BREEAM New Construction to single and multiple dwellings, partially and fully fitted for a more detailed description of residential assessment options.
General
CN3	Appropriate examples See criterion 3 .	The options selected to demonstrate how life cycle costs have been minimised and critical value maximised must be appropriate in terms of their relative impact on project costs, future building maintenance burden and size (volume or area) and the stage of the project. At stage 2, when considering the outputs from the elemental LCC plan, examples could be in the form of elemental appraisals (where appropriate), evolutions in concept design to reduce maintenance or replacement costs or contracts for further elemental analysis. At stage 4, when considering the outputs from the component level options analysis, examples are likely to be in the form of component specifications coupled with justifications for their selection (i.e. how they reduce life cycle costs and maximise critical value).
CN3.1	Predefined specifications	Where the building is constructed to a predefined standard specification, the LCC elemental plan for this specification may be used to help demonstrate compliance.
CN3.2	Capital cost reporting final information not available	At the design stage of assessment, where the final information is not available, the credit can be awarded where the client provides the predicted capital cost, including contingencies, and commits to providing this information for the final stage of assessment. At the final stage, if the final capital cost is not known, the client's or cost consultant's best estimate should be provided. This data will be used to inform future BREEAM performance benchmarking and will be anonymised.
CN3.3	Independent assessment of parts	All three parts can be awarded independently from one another. For example, the project team can still target the one credit for the component level LCC option appraisal at stage 4 even if they have not been awarded the first two credits at stage 2 for developing an elemental life cycle cost plan. The capital cost reporting credit can also be awarded independently from the other two parts.
CN3.4	Component level LCC options appraisal – assessing types 4.a–4.d	The component level LCC options appraisal should review all of the component types listed, 4.a–4.d (where present). However not every single example cited under each component need be considered; only a selection of those most likely to draw valued comparisons. This is to ensure that a wide range of options are considered and help focus the analysis on components which would benefit the most from appraisal.
CN3.5	Elemental LCC plan study period	The study period should ideally be agreed by the client, in line with the design life expectancy of the building. However, where the life expectancy of the building has not yet been formally agreed (due to the early stages of the design process), the default design life of 60 years should be used for modelling purposes.

Methodology

None.

Evidence

Criteria	Interim design stage	Final post-construction stage
1–3	Elemental LCC plan.	As per interim design stage.
4–5	Component level LCC options appraisal.	As per interim design stage.
6	Predicted capital costs via the BREEAM scoring and reporting tool.	Capital costs via the BREEAM scoring and reporting tool.

Additional information

Relevant definitions

Life cycle cost (LCC)

The cost of an asset, or its parts throughout its life cycle, while fulfilling the performance requirements; a methodology for systematic economic evaluation of life cycle costs over a period of analysis, as defined in the agreed scope.

Elemental LCC plan

This is commonly used for developing solutions at project level during option appraisals. Costs are normally at building elemental level on the entire asset. Information may be a mix of typical benchmark costs for key elements, comparative cost modelling or approximate estimates. It is expressed as cost per square metre of gross internal floor area (GIFA) and presented for elemental analysis, aligned to the level of capital cost plans.

Component level LCC options appraisal

A component level LCC plan is commonly used for cost planning specification choices of systems or component levels during design development. Component level LCC appraisal for service life planning requires the environment of the building and other local conditions to be identified, and the fundamental requirements to be met in planning the service life of the building. Decisions should be made on:

The likely design life of the building (rather than the contractual design life)
Minimum functional performance criteria for each component over the building's design life
Components that must be repairable, maintainable or replaceable within the design life of the building. Only the key differentiators between components and systems need to be comparatively modelled.

Capital cost

The capital cost for the building includes the expenses related to the initial construction of the building:

Construction, including preparatory works, materials, equipment and labour
Site management
Construction financing
Insurance and taxes during construction
Inspection and testing.

Costs relating to land procurement, clearance, design, statutory approvals and post occupancy aftercare should not be included.

Other information

Capital cost reporting

The lack of data relating to capital and life cycle costs and benefits arising from more sustainable building design presents a major barrier to take-up of more sustainable solutions. This issue seeks to encourage the sharing of data to break down these barriers and ensure that BREEAM continues to encourage cost effective and financially beneficial solutions. This information is collected to assist research into the cost and savings of developing sustainable or BREEAM-assessed buildings. This is used to inform the business case for sustainability and the ongoing development of BREEAM. All data submitted will be treated as confidential and will only be used anonymously.

When to undertake life cycle costing

Life cycle costing is relevant throughout the building or constructed asset's life cycle, in particular during the project planning, design and construction and also during the in-use phases. (For further information please refer to ISO 15686-5.)

Standardised method for life cycle costing (SMLCCStandardised method for life cycle costing) for construction

ISO 15686-5:2008 describes the standardised method for life cycle costing (SMLCC) for construction procurement. The objectives of this guide are to provide the following.

LCC practitioners with a standardised method of applying life cycle costing, applicable to the construction industry and to the key stages of the procurement process.
Process mapping the LCC stages - to help structure how to plan, generate, and interpret and present the results for a variety of different purposes and levels of LCC planning.
Instructions on how to define the client's specific requirements for life cycle costing and the required outputs and forms of reporting - and to decide on which method of economic evaluation to apply.
Simplification and demystification - by providing practical guidance, instructions and definitions, together with informative worked examples on how to undertake life cycle costing (for construction).
An industry accepted methodology to facilitate a more accurate, consistent and robust application of LCC estimation and option appraisals, thereby creating a more effective and robust basis for LCC analysis and benchmarking. ISO 15686-5:2008 also seeks to help eliminate confusion over scoping and terminology and to address concerns over the uncertainty and risks that are undermining confidence in life cycle costs used for construction procurement.