ISO15686-5:2008, which provides general guidelines for life cycle costing of buildings, defines LCC as “a methodology for systematic economic evaluation of life-cycle costs over a
period of analysis, as defined in the agreed scope” and note that it can address the entire
life cycle or selected stages (ISO, 2008b). Gluch & Baumann (2004) report that the first attempts to apply LCC to buildings were in the 1980s, while there are reports of somewhat similar thinking in ‘cost-in-use’ approaches applied to buildings in the UK as early as the 1950s (Ashworth, 1993 cited in Öberg, 2005, p. 28).
Kneifel (2010) describes LCC of buildings as estimating the costs associated with acquiring and operating a building over a period of time, including costs associated with: construction; maintenance and repair; replacement of components; energy consumption;
etc. To enable comparisons of costs and revenues from different time periods, future
transactions are discounted to their equivalent present values based on the relevant
48 The inherent uncertainty of future impacts is also significant e.g., the likelihood of tipping points
discount factors, and thereby deriving a net present value of the costs (Gluch & Baumann, 2004). Öberg (2005, p. 29) highlighted the importance of the discount rate to LCC calculations, with lower discount rates increasing the value placed on a future event and a zero discount value making temporal differences irrelevant49. The typical life cycle costs
associated with a building can be divided into those costs embodied in the structure of the building so-called embodied costs, those costs that are required to operate the building, and end of life costs, as shown in Figure 18 below (see also Figure 21 on page 95, Figure 23 on page 100, which give a similar over view of life cycle energy and greenhouse gas emissions respectively).
Figure 18: Overview of constituents of a building’s life cycle costs
3.4.3 Life cycle energy
Introduction
Since the earliest times energy of some form or another has played an important role in the development of our civilisation, an adequate supply of energy is required to provide the basic necessities of life, such as shelter, food and clothing. Accordingly, energy can be considered an essential building block of society. This importance is underscored by the comments of Nobel-prize winning physicist, Frederick Soddy who said in 1926 “If we have
energy, we may maintain life and produce every material requisite necessary. That is why
49 In principal the discount rate should be equal to the alternative cost of capital, which obviously
the flow of energy should be the primary concern of economics” (Clark, 1989, p. 127).
Energy analysis can be thought of as a study of the flow of energy in society. As mentioned previously, the 1970s oil crises raised energy to the top of public policy considerations, Alessio (1981) argues that energy analysis became of far more interest to policy makers once the OPEC cartel was formed and gives the example of the US 1974 Non-Nuclear Energy Research and Development Act, which introduced a legal requirement for energy analysis (albeit that there was no consensus on what this meant) 50.
Energy is such a fundamental part of all human activities that an energy analysis necessitates a life cycle approach to capture all the energy requirements represented by a particular system e.g., in the case of a product system, this would entail not only the energy consumed directly during production, but also all energy consumed associated with the production and/or provision of equipment, materials and services needed for manufacturing. Boustead & Hancock (1979, cited in; Fitch & Smith Cooper, 2004) defined energy analysis as “a technique for examining the way in which energy sources are
harnessed to perform useful functions” giving the example of production and recycling of
metals. One of the first such energy analysis studies is Harold Smith’s 1963 report at the World Energy Conference of cumulative energy requirements for the production of chemical intermediates and products (SAIC, 2006, p. 4).
50 It may be that Alessio is conflating OAPEC, the Organization of Arab Petroleum Exporting
Countries (which was founded in 1968 and proclaimed the 1973 oil embargo) with OPEC, the Organization of the Petroleum Exporting Countries, which was founded in 1960.
Figure 19: Generic constituents of product life cycle energy The above figure disaggregates the energy associated with a generic product over its life. The sum of energy consumed in the manufacture of the product is said to be embodied i.e., that energy associated with the extraction and processing of raw materials, manufacturing operations and transportation activities are seen as incorporated in the product. Costanza (1980, p. 1219) describes embodied energy as “total (direct and indirect) energy required for the production of economic or environmental goods and services”. Operational energy of a product is that energy consumed through use over its useful life, for some products this could be quite substantial (e.g., motor vehicles51), while for others it will be negligible or irrelevant. The final constituent of life cycle energy is that associated with the recovery, recycling and/or disposal activities which occurs when a product’s useful life comes to an end.
Primary Energy or Secondary Energy
Primary energy can be thought of as the energy inherently present in natural energy resources before undergoing any transformation52, e.g., chemical energy of fossil fuels such
51 Danilecki, Mrozik, & Smurawski (2017) offer an interesting summary of interaction between life-
cycle stages for the manufacture of cars. They detail the trade-offs implicit in the use of lighter materials to increase operational energy efficiency of vehicles – with the energy savings achieved over the average life of a car being more than off-set by higher quantity of energy used to produce the new materials.
52 Primary energy i.e. energy inherently present in a fuel should not to be conflated with a product’s
oil; chemical energy of biomass; radiation energy of uranium; solar energy from sunlight; kinetic energy from moving water and wind; thermal energy from geothermal boreholes,
etc. (Cleveland & Morris, 2006, p. 346).
Øvergaard (2008) identified the key characteristic of primary energy as the process of extraction or capture with the physical and chemical characteristics of the energy being unchanged. She presents the example of hard coal, which may be cleaned and graded but otherwise unchanged, as a primary energy source. Contrast this with the related fuels of lignite and peat, which are dried and processed into briquettes, and which are considered secondary fuels. These primary energy sources undergo energy conversion processes to be transformed into more useful forms of energy, such as electrical energy53 and refined fuels, which are termed secondary energy sources as shown in Figure 20 below.
Figure 20: Primary and secondary energy (adapted from Øvergaard, 2008, p. 5)
The energy delivered to end-users is a mixture of primary fuels (e.g., coal and natural gas) and secondary fuels (e.g., electricity and refined fuels). The industries, which produce and distribute the fuels themselves use energy, conversion to secondary fuel will have losses from entropy, additionally there are losses through the distribution system (Hulscher,
53 Other sources have distinguished between the source of the electricity, classifying electricity from
renewables as primary energy, Øvergaard (2008) however argues convincingly otherwise on the basis of consistency and clarity.
1991). It can be seen therefore that the energy delivered to site is not the complete energy consumption associated with the site’s activities; Marszal et al. (2011) also observe that the different qualities of energy delivered are also ignored, when considering delivered energy alone. It is apparent then that consideration of product life cycle energy consumption (whether of a generic product or a building) must be addressed in terms of primary energy and not delivered energy.