The Cost of Intelligent Buildings

03/28/2014 |

Simple payback doesn’t capture full benefits

The cost of intelligent buildings may be hard to jusitify if you only use a simple payback calculation. Try lifecycle costing instead.

How do you justify improvements to your building automation system?

If you only use a simple payback calculation, you won’t capture the full benefits, says the Continental Automated Buildings Association. In its report, Life Cycle Costing of Intelligent Buildings, the organization argues that lifecycle costing (LCC) is a superior method.

This is because the impacts of an intelligent building are far greater than energy efficiency alone. Facilities that integrate their systems on a single IP network platform will:

  • Improve interdependency between building systems and users
  • Provide a healthier and more comfortable environment
  • Increase economic performance
  • Reduce energy and resource usage
  • Benefit from renewable energy technologies
  • Augment indoor air quality and occupant satisfaction.

Compared to standalone utilities and communication systems, these advantages improve an intelligent building’s performance, lower maintenance costs, and reduce environmental impacts, the report states.

Not only are payback calculations unable to capture these benefits, but they do not account for costs such as installation, training, maintenance, operation, service agreement, and disposal. LCC, however, takes into consideration reoccurring costs, incentives, and lifecycle assessments.

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