ANÁLISIS DE LA GESTIÓN

The discussion in this section describes the processes involved in develop- ing an LCCA model for an infrastructure pavement design project.*

Design options considered involve CRCP and AC. Three lifespan periods of 30, 60 and 100 years, with a discount rate calculated at 8% (incorporat- ing sensitivity analyses), finds that the asphalt pavement alternative is the less expensive option, recommending asphalt pavement over concrete pave- ment in this local West Australian environment. The following discussion explains how these findings were generated.

Roads make up a large proportion of total civil infrastructure in Australia, with highways being major schemes that are owned by the State Government *Input from Anna Pham,30–45 _{received with thanks.}

in perpetuity; sole ownership indicates that whole-of-life costs studies are extremely relevant for asset management.

Generally, asphalt pavements are favoured due to less expensive acquisi- tion costs albeit conversely in-use maintenance might be expected to be substantial; a truism exists in the industry that although concrete roadways have a higher capital cost, upkeep costs might be expected to be lower. An LCCA was conducted to empirically assess the cheaper option.

As mentioned previously, LCCA takes into account all costs that occur over the effective life of the resource. Discounting is applied so that all costs induced over several periods are converted into present-day monetary val- ues, summated into an NPV. Early application yields the best outcomes and allows for design specification changes to occur during planning. Figure 2.6 shows how the cost of making changes increases while the opportunity for savings decreases as time goes on.

The determination of a suitable discount rate for the analysis can lead to dif- fering results, and civil engineers and analysts seldom reach a consensus figure; as mentioned previously, the Eastern Australian State of Victoria (VicRoads) opts for 7% whereas the National Road Transport Commission pegs the dis- count rate at 5%. The rate adopted here sought a factor of treasury bond rate of return, inflation rate, and average equity return rate to place long-term ser- viceability into context in which concrete pavements include methods such as full-depth repair, slab stabilisation or joint and crack resealing, whereas reha- bilitation of asphalt pavement involves levelling and resurfacing, performed in conjunction with widening. Overall, the classic sawtooth effect of spend and deterioration occurs: spend money to build/record a gradual deterioration, spend money on maintenance/record a further deterioration, spend money to refurbish or replace/record a further deterioration until the end of life, scrap and seek residual return/then spend money for replacement.

A project-specific LCCA model/spreadsheet was developed using Excel, which enabled each component of the analysis to be input and compared;

Potential savings and cost relationship from the NSW treasury Cost of making changes Potential for making savings Time Cost

different specification options and cost components over the useful life of the pavement were entered, namely, asphalt-surfaced (AC) and concrete pave- ment (CRCP) designs. In addition, stakeholder consultation with MainRoads Western Australia clarified the specification(s), cost and maintenance data generated.

The discount rate was calculated by taking into account factors such as inflation and interest, a 5.44% treasury bond rate of return based on a rea- sonable 10-year yield, an inflation rate attained from the Reserve Bank of Australia’s website of 1.5%, and an average equity return rate assessed as 13.6% was taken from Investment-Wise. These values allowed the discount rate to be calculated as 8.0% (sensitivity analysis applied).

NPVs of asphalt and concrete pavement alternatives (AC and CRCP) over periods of 30, 60 and 100 years showed that the asphalt alternative (some- what surprisingly, given the expectation for high maintenance and refur- bishment) was the cheaper alternative, as shown in Table 2.12.

The initial cost for the concrete pavement accounted for half of the total costs, whereas the initial costs were only 20% of the entire life cycle costs for asphalt. Maintenance for asphalt conversely was double that of con- crete. The higher costs at the construction phase of the pavement lead to fewer maintenance costs over the life of the specification in question (in the case of the concrete pavement, higher costs lead to fewer maintenance works over the life of the pavement).

Reconstruction was more expensive for asphalt compared with concrete reconstruction, perhaps reflecting the higher involvements in the removal and replacement of the more extensive layers associated with the asphalt alternative (Figure 2.7).

Table 2.12 LCCA comparison: Blacktop versus concrete Option/type

of pavement Construction cost ($/m2₎ Maintenance _{costs ($/m}2₎

Rehabilitation/ reconstruction

costs ($/m2₎ Salvage value _($/m2_{) NPV ($/m}2₎

30-year analysis period

1 AC 74.20 14.52 0 0 88.72

2 CRCP 133.00 2.45 0 0 135.45

60-year analysis period

1 AC 74.20 15.33 6.04 2.65 98.22

2 CRCP 133.00 2.87 1.48 −0.74 136.61

100-year analysis period

1 AC 74.20 15.46 6.31 2.77 98.74

The initial costs for the asphalt and concrete alternatives showed an anticipated large variation. The costs for the concrete alternative were seen to be significantly greater (by 44%). The costs of concrete’s initial construc- tion in Western Australia is almost double that of asphalt and is a major factor that deters pavement agencies from using concrete (Table 2.13).

Asphalt vs. concrete LCCA 60 years Initial cost Residual Maint Initial cost Residual Maint Recon Recon Intial cost Maintenance Reconstruction Residual Concrete Asphalt 16% 20% 37% 27% 27% 10% 50% −13%

Figure 2.7 LCCA breakdown.

Table 2.13 Capital cost comparison

Initial capital costs

Blacktop Concrete

Description Rate ($/m2_{) Description Rate ($/m}2₎ 175 limestone sub-base 13.77 150 mm sub-base LMC including

finishing, curing/provision of typical quantities of subgrade beams for accesses and intersection

35

230 base course 30.84

Two-coat emulsion seal 6.76

Tack coat 0.34

30 dense-graded asphalt 13.59 240 mm continuously reinforced concrete pavement: supply and place concrete, and longitudinal joints and slab anchors

60 30 open-graded asphalt 8.90

Finish cure and texture base 3 Supply and place steel

reinforcement 35

The maintenance costs formed a bulk of the overall costs over the life of each alternative; asphalt pavement options historically require more routine repairs to fix deterioration such as potholes and other structural failures. Concrete, on the other hand, with its higher durability and strength charac- teristics, can withstand the elements and the same amount of traffic loading without extensive restoration. The reconstruction costs for concrete pave- ment occur at year 50, whereas the reconstruction costs for asphalt pave- ment carries a much higher rate (as a result of more regular refurbishment). The costs of reconstruction were significantly higher than the initial costs of construction because, in Western Australia, the opportunity or the ability (in real terms) to recycle and reuse materials beyond concrete as a sub-base fill is limited, thus nominal residual amount(s) are generated and used to offset new builds. Overall, in Western Australia, asphalt is recommended over concrete.