Florida Administrative Code
60 - DEPARTMENT OF MANAGEMENT SERVICES
60D - Division of Building Construction
Chapter 60D-4 - RULES FOR CONSTRUCTION AND LEASING OF STATE BUILDINGS TO INSURE ENERGY CONSERVATION
Section 60D-4.006 - Life-Cycle Cost Analysis Requirements
Universal Citation: FL Admin Code R 60D-4.006
Current through Reg. 50, No. 187; September 24, 2024
A life-cycle cost analysis shall be performed for all new facilities constructed for the use of a state agency and for renovations to existing state-owned facilities where required in Rule 60D-4.004, F.A.C. The analysis shall compare the reasonably-expected life-cycle costs of alternative designs developed in accordance with Rule 60D-4.004, F.A.C., during the design development phase of the project. Life-cycle cost analyses shall comply with all of the following requirements:
(1) Preparation requirements:
(a) The life-cycle cost analysis shall be
performed by one of the following:
1. An
architect licensed in Florida;
2.
An engineer licensed in Florida;
3.
A "guaranteed energy, water, and wastewater performance savings contractor" as
defined in Section 489.145,
F.S.
(b) The life-cycle
cost analysis shall be performed by the same person or firm that performed the
computer-based energy simulations required in Rule
60D-4.004,
F.A.C.
(2) Methodology: The life-cycle cost analysis shall determine the expected total present-value cost to own, operate, maintain, and replace the energy-consuming equipment for each alternative design throughout the analysis period as described in this rule.
(3) Analysis period:
(a) The analysis period shall be 25 years for
each alternative design under consideration in a project unless directed
otherwise in this section.
(b) The
analysis period for "guaranteed energy, water, and wastewater performance
savings projects" as defined in Section
489.145, F.S., shall be equal to
the expected term of the "guaranteed energy, water, and wastewater performance
savings contract".
(4) Analysis approach: For each alternative design, the total life-cycle cost shall be determined as described here:
(a)
Life-cycle ownership cost:
1. All ownership
costs utilized in the analysis shall include all related material, labor, and
installation costs.
2. The total
ownership cost utilized in the analysis shall consist of all of the following
that are to be installed new or replaced in the project:
a. Building envelope components and windows:
(I) New construction and additions per
subsection 60D-4.004(1),
F.A.C.: The incremental cost of the energy-related modifications may be
utilized in the analysis, in which case the incremental cost for the least
expensive alternative design shall be zero. Otherwise, the total cost for the
scope of work shall be utilized.
(II) Renovations: The total cost for the
scope of work shall be utilized.
b. HVAC: The total cost for the scope of work
shall be utilized.
c. Lighting: The
total cost for the scope of work shall be utilized.
d. Service water heating: The total cost for
the scope of work shall be utilized.
e. Power distribution: The total cost for the
scope of work shall be utilized.
f.
Other measures: Analyses for "guaranteed energy, water, and wastewater
performance savings projects" as defined in Section
489.145, F.S., shall include the
costs for all energy conservation measures proposed in the
project.
3. For projects
that are not financed by the agency, the life-cycle ownership cost utilized in
the analysis shall be assumed to occur in the initial year of the analysis
period and require no conversion to present value dollars.
4. For "guaranteed energy, water, and
wastewater performance savings projects" as defined in Section
489.145, F.S., the total
ownership cost utilized in the analysis shall be determined as follows:
a. The expected construction costs,
investment grade energy audit costs, measurement and verification costs, and
financing costs shall be annualized.
b. The DOE real discount rate shall be used
to convert all future annual ownership costs to present value dollars. The DOE
real discount rate is available in the Annual Supplement to NIST 135, which is
incorporated by reference in Rule
60D-4.008, F.A.C.
c. Grants, rebates, and capital funding used
to buy down the cost of the "guaranteed energy, water, and wastewater
performance savings contract" shall not be included in the life-cycle cost
analysis per Section 489.145(4)(j),
F.S.
d. The life-cycle ownership
cost shall be calculated as the sum of all present-value annual ownership costs
that are expected to occur during the analysis period.
e. Exclusion: The analysis for the baseline
energy model described in subparagraph
60D-4.004(4)(g)
2., F.A.C., shall not include any life-cycle ownership
costs.
(b)
Life-cycle operating cost:
1. The annual
energy usage utilized in the analysis shall be determined by the computer-based
energy simulation requirements of Rule
60D-4.004, F.A.C.
2. The actual energy prices available from
the local utility provider shall be used to convert the annual energy usage to
the annual operating cost for the initial year.
3. The DOE energy price escalation forecasts,
not including the effects of general price inflation, shall be used to predict
future annual energy costs. These forecasts are available in the Annual
Supplement to NIST 135, which is incorporated by reference in Rule
60D-4.008, F.A.C.
4. All water costs associated with the
alternative design shall be incorporated into the the life-cycle operating
cost.
5. The price escalation
factor utilized for water costs shall be derived from historical water costs
for the building(s).
6. The effects
of general price inflation shall be excluded from the analysis.
7. The DOE real discount rate shall be used
to convert all future annual operating costs to present value dollars. The DOE
real discount rate is available in the Annual Supplement to NIST 135, which is
incorporated by reference in Rule
60D-4.008, F.A.C.
8. The life-cycle operating cost shall be
calculated as the sum of all present-value annual operating costs that are
expected to occur during the analysis period.
(c) Life-cycle maintenance cost:
1. The expected annual maintenance costs
utilized in the analysis shall be derived for all new energy-consuming
equipment based on estimates or direct quotes from the equipment manufacturer
or vendors that represent the equipment manufacturer. For existing
energy-consuming equipment, the annual maintenance costs utilized in the
analysis shall be based on actual maintenance costs.
2. The scope of maintenance services utilized
to develop the expected annual maintenance costs for new energy-consuming
equipment shall:
a. Be based on the equipment
manufacturer's recommendations, and
b. Include regularly scheduled maintenance
items such as planned overhauls, but not attempt to include coincidental
repairs.
3. The DOE real
discount rate shall be used to convert all future annual maintenance costs to
present value dollars. The DOE real discount rate is available in the Annual
Supplement to NIST 135, which is incorporated by reference in Rule
60D-4.008, F.A.C.
4. The effects of general price inflation
shall be excluded from the analysis.
5. The life-cycle maintenance cost shall be
calculated as the sum of all present-value annual maintenance costs that are
expected to occur during the analysis period.
(d) Life-cycle replacement cost:
1. The analysis shall include the replacement
cost for new energy-consuming equipment that has an expected service life that
is shorter than the analysis period.
2. Expected service life:
a. The expected service life utilized in the
analysis for energy-consuming equipment shall be based on the 2007 ASHRAE
Handbook - HVAC Applications (Chapter 36, Table 4), which is incorporated by
reference in Rule 60D-4.008, F.A.C., but may be
modified to account for the following circumstances:
(I) The agency's experience with similar
equipment;
(II) Harsh environments
such as coastal, marine, industrial, and urban areas that can effectively
shorten equipment service life.
b. For equipment not included in the 2007
ASHRAE Handbook - HVAC Applications (Chapter 36, Table 4) per paragraph (a) of
this section, the expected service shall be estimated based on one or both of
the following criteria:
(I) The equipment
manufacturer's recommendation;
(II)
The judgement of a licensed architect, engineer, or
contractor
3.
Replacement costs shall be derived from the initial ownership costs.
4. The DOE real discount rate shall be used
to convert all future replacement costs to present value dollars. The DOE real
discount rate is available in the Annual Supplement to NIST 135, which is
incorporated by reference in Rule
60D-4.008, F.A.C.
5. The effects of general price inflation
shall be excluded from the analysis.
6. The life-cycle replacement cost shall be
calculated as the sum of all present-value replacement costs that are expected
to occur during the analysis period.
(e) Residual value:
1. The analysis shall include residual value
for energy-consuming equipment that is expected to be replaced during the
analysis period and therefore has an expected service life that extends beyond
the analysis period.
2. The
residual value shall be derived by linearly prorating the replacement cost
based on the ratio of remaining service life to total expected service life,
assuming a salvage value of zero.
3. The DOE real discount rate shall be used
to convert all residual values to present value dollars. The DOE real discount
rate is available in the Annual Supplement to NIST 135, which is incorporated
by reference in Rule 60D-4.008, F.A.C.
4. The effects of general price inflation
shall be excluded from the analysis.
(f) Total life-cycle cost: The total
life-cycle cost shall be calculated as follows:
1. The life-cycle ownership cost,
plus;
2. The life-cycle operating
cost, plus;
3. The life-cycle
maintenance cost, plus;
4. The
life-cycle replacement cost (when applicable), less;
5. The residual value (when
applicable).
(g)
Sensitivity analysis:
1. The agency shall
perform a sensitivity analysis as described in this section to account for
uncertainty in the discount rate and future energy prices in an attempt to
ascertain which variable(s) are most critical to the financial performance of
the project.
2. The sensitivity
analysis shall be structured to determine the total life-cycle cost result as a
result of incrementally modifying the discount rate and energy price
projections one at a time, and then both simultaneously.
3. Limits:
a. The discount rate utilized in the
sensitivity analysis shall be raised no higher than twice that of the DOE real
discount rate.
b. The energy price
projections utilized in the sensitivity analysis shall be raised no higher than
current prices projected forward at twice the average DOE price escalation
rate.
(5) Submission requirements:
(a) The life-cycle cost analysis shall be
submitted to the agency during the design development phase of the
project.
(b) The life-cycle cost
analysis shall be submitted to the department in addition to the agency for
projects that pertain to subsections
60D-4.004(1) and
(4), F.A.C., during the design development
phase of the project, pursuant to Sections
255.254(1) and
489.145(6),
F.S.
(c) Required forms:
1. A bound copy and an electronic version in
Microsoft Excel® format of the Florida
Life-Cycle Cost Analysis Program (Form #AE16) is required for all
submissions.
2. A printout of the
input and output sheets of the computer-based simulation program for each
alternative design.
(d)
The Florida Life-Cycle Cost Analysis Program (Form #AE16) is hereby
incorporated by reference.
(e) The
Florida Life-Cycle Cost Analysis Program (Form #AE16) is available from the
Department of Management Services at:
DMS Building Construction
4050 Esplanade Way, Suite 335
Tallahassee, Florida 32399-0950
(850) 488-1817
(f) Delivery: The life-cycle cost analysis
shall be delivered to the department at:
DMS FLCCA Review
4050 Esplanade Way, Suite 335
Tallahassee, Florida 32399-0950
(850) 488-1817
Rulemaking Authority 255.255, 255.256 FS. Law Implemented 255.254, 255.255 FS.
New 5-26-76, Formerly 13D-10.06, 13D-10.006, Amended 3-17-10.
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