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Understanding Whole Life Costs and Sustainability for Better Decision-Making

This guide delves into the definition of Whole Life Costs, the three elements of sustainability, and why clients and professionals should care. Learn how WLC fits into sustainability efforts, and steps to take for better asset management and sustainable practices. Explore how WLCF tools can assist in decision-making and maximizing financial gains while promoting sustainability.

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Understanding Whole Life Costs and Sustainability for Better Decision-Making

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  1. An Introduction toWhole Life Costs and Sustainability

  2. Content • Definition of WLC • The 3 Elements of Sustainability • Where Does WLC Fit In? • Why Should Clients Care? • Why Should You Care? • What We Need To Do? • Where WLCF Can Help?

  3. Definition of WLC Whole Life Cost is the analysis of all relevant and identifiable financial cashflows regarding the acquisition and use of an asset.

  4. 3 Elements of Sustainability Social Economic Environmental

  5. 3 Elements of Sustainability Social Economic Environmental

  6. 3 Elements of Sustainability Social Economic Environmental Unattainable

  7. Social Economic Environmental Activities in Sustainability Whole Life Cost Aesthetics Materials

  8. Where Does WLC Fit In • Next Step in Continuous Improvement • First Step in Sustainability • May Already be Doing It (Sort Of) • Easily Understood • Financial and Operational Gains

  9. Whole Life Cost Ratios Capital Cost Cost in Use Business Costs 1 : 5 : 200 Source.: "The long term costs of owning and using buildings" – published by The Royal Academy of Engineering (November 1998). Capital Cost Cost in Use Cost to Business 1 : 5 : 200 -100k : +£500k : +£20m

  10. Design Build Operate Dispose Total Run / Maintain £ 40% 100% Cost of Ownership Repair £ 30% £ ?% £ 3% £ 17% Periodic Replacement / Refurbish £ 10% 1 Year 2 Years 25 Years 1 Year Total WLC – The Big Picture Source Gardiner & Theobald

  11. WLC Rules of Thumb

  12. 5% 7% 10% 31% 20% 27% Revenue Cost Breakdown • Energy • Cleaning • Maintenance • Admin Services • Security • Admin and Management Insurance

  13. Compulsion Climate Change Levy Carbon Trading PFI Conditions Funding Concern for Environment Curiosity Competitive Advantage Profit Why Should Clients Care?

  14. Why Should You Care? • Leading Role in Industry • Understand New Concepts • Concern for Environment • Competitive Advantage • Profit

  15. What We Need To Do • Adopt Performance Specification • Consider the Costs in Use for Asset Selection • Take Small Steps - Progress Slowly • Understand What You Have Achieved • Benchmark

  16. Where WLCF Can Help • The web based WLC Comparator Tool • Common Data Structures • Common Calculation Methodologies • Access to Database • Optioneering • Benchmarking • Credibility • Accreditation • Help - You Are Not Alone

  17. Some Useful Web Sites • Whole Life Cost Forum • www.wlcf.org.uk • Training • Definitions • Guidance • Access to the Online Tool

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