NeSSI Life Cycle Cost Model

1. NeSSI Life Cycle Cost Model CPAC FALL 2006 SPONSORS MEETING NeSSI WORKSHOP Thursday, November 9, 2007 John Wawrowski Dave Simko

2. Definition Life cycle cost analysis help justify equipment and process selection based upon total costs rather than initial purchase price. • Includes all costs incurred during the life of an item • Sum of the operation, maintenance, and decommissioning/disposal costs far exceed procurement costs

3. Objective • The objective of a life cycle cost analysis is to determine… • The lowest long term cost of ownership • Not cheapest first cost

4. Effectiveness Considerations • Availability • The amount of time the system is performing its intended function • The objective is to maximize analyzer uptime • Reliability • Failure-free performance • Reduce or eliminate failures over a prescribed time interval • Key to a successful design

5. Effectiveness Considerations • Maintainability • Ease and speed with which both scheduled and unscheduled maintenance can be diagnosed and performed • Objective is to minimize downtime of the analyzer system • Capability • How well the system performs its intended function • Objective is to design, build, and operate system reliably and repeatedly provide accurate information needed to control the process

6. Reliability • Reliability is the key issue in the effectiveness of process analyzer systems • Reliability is the assurance that a system will provide trouble-free service over a long period of time without interruptions or failure, resulting in increased productivity and decreased maintenance and manpower, lowering overall costs

7. Reliability Factors • System deterioration • Equipment deterioration • Component failures • Order changes to disorder unless interventions occur • Front-end engineering can build in reliability and maintainability Three Important Issues • Installation and use practices • Grade and quality of equipment employed • Load profiles on the equipment

8. Life Cycle Cost Model Total Costs • Acquisition • Design • Build • Install • Commission • Sustaining • Operate • Maintain • Decommission

9. NeSSI Fits The Model • Acquisition Costs • Design and development • Analyzer System, sample system, protection system/enclosure, primary equipment, support equipment, data processing equipment • Procurement/Installation • OEM Suppliers, Integrators, Fabricators, Contractors installers, Testing/commissioning • Support • Facilities modifications, Training, Management of Change

10. NeSSI Fits The Model • Sustaining Costs • Operating • Spares, consumables, utilities/energy, labor, documentation • Maintenance • Scheduled, unscheduled, downtime/lost production, spares • Support • Facilities/infrastructure, ongoing training, safety/regulatory compliance, documentation • Decommissioning

11. Current Life Cycle Cost Analysis • Acquisition data is available from end users • Reduced downtime • Minimized drafting time • Higher internal cost for modular components and assemblies • Easier installation and commissioning • Simplified, effective training • Component cost data is available from suppliers • Predictable data can be estimated • Lower cost of consumables • Lower transport cost

12. Current Life Cycle Cost Analysis • Operation and maintenance data is needed from end users • A model cannot be completed without this data • Generation I units have been in the field for extended period of time • Some as many as four years or longer • A formula is needed so data that is sanitized but accurate can be reported