How to Understand Life Cycle Cost (LCC)Operational Expenditure (OPEX) accounts for the biggest portion of the machine’s total life span. So, on top of the initial cost, you are also paying for installation costs, maintenance costs and power consumption across its entire life span.LCC should be carried out after productivity, reliability and safety aspects are met. The analysis examines every stage in the life cycle, from the selection or raw material to final waste removal/recycling.
The Calculation of Life Cycle Costs (LCCs)As a general overview of LCCs, energy costs are the highest expense, following by investment costs and maintenance costs. Energy cost makes up for 76% of life cycle costs, 14% investment costs, and 10% maintenance costs.These calculations obviously depend on any future evolutions in energy prices and other important values, like how different investment options affect certain factors. These factors could be production quality, production safety, subsequent investment requirements, production machine and the distribution network maintenance, environmental impact, the quality of the final product, and risks for downtime and for rejections.
Different Types of Energy CostAs energy cost is the largest percentage of LCCs, it’s important to understand the different types of energy costs, so you can achieve sustainability and profitability.
- Load Power - Generating compressed air at certain pressure with required flow.
- Unload Power - Running idle without generating any useful compressed air for internal process.
- Blow off losses - When running idle, the compressor depressurises and leads to loss of valuable compressed air to atmosphere.
- Pressure drop - Every 1 bar(g) increase in pressure consumes 7% more power, so if there is a pressure drop in the system, it will lose power
- Air leakages - Air leakages can use approximately 10 – 30% of the compressed air energy, resulting in huge power and operating losses.
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