Lifecycle costings of PVC-U

The debate over lifecycle costings has been ongoing for a number of years with many of the leading ‘interested’ parties commissioning studies and surveys. In the library section on this site under ‘PVC-U and the environment', there are a number of reports including the Entec report commissioned by Manchester City Council. The BRE is currently working on an updated study, and its findings will be published on this site when they are available.

Below is one statement, typical of the kind of reports written on the subject of lifecycle costings.

1.1 Introduction

The whole life costs of the wood and UPVC windows have been examined. This has entailed a net present value (NPV) assessment. The NPV is a representation of the total cost expressed as the investment required ‘today’ to pay for the 25 year timescale. The results of the assessment are presented in this section.

1.2 Method

The NPV has been based on capital and maintenance costs for both the standard 25 year period and the whole life of the profiles of 30 years. The discount rate in the investment appraisal table is 6%, in accordance with normal government recommendations. VAT is excluded. Due to this long timescale the NPV’s provided are estimates and in some circumstances may not reflect the actual expenditure during the lifetimes since external factors such as the actual maintenance programme undertaken and the actual maintenance cost (labour & material cost) will affect whole life costs.

The following analyses have been performed:

25 year NPV (standard NPV calculation period);

30 NPV (to reflect the whole expected life of the profiles); and

Sensitivity analysis on painting frequency.

Following discussion with Manchester City Council, the following general assumptions were made for the analysis:

Number of window per property: 11;

Capital cost wood per profile: £265;

Capital cost UPVC per profile: £254;

Maintenance cost for wood per property (every 5 years): £400; and

Maintenance cost UPVC per property: £0[1].

The capital costs quoted are current discounted prices available to Manchester City Council. It is possible that further discount of approximately 15% could be achieved through bulk purchase contracts. Local, undiscounted open market prices for the profiles have been found to be higher at £325 for wood and £270 for UPVC. Undiscounted prices used as part of the DETR 2000 study were £375 for wood and £297 for UPVC. It is apparent the UPVC capital cost is consistently cheaper than wood by between 4% and 26%, the bulk purchase discounted prices exhibiting the smallest percentage difference.

Two rates of replacement were examined for each material, 500 properties per year for 10 years and 5,000 properties per year for 10 years. Costs excluded at this stage are:

Costs incurred due to the necessary repair/replacement of existing stock through the current practice;

Disposal costs of the removed windows; and

Disposal/recycling costs at the end of life of the replaced windows.

1.3 Results

1.3.1: 25 Year NPV

Table 3.1 presents the results of the 25 Year NPV assessment. The NPV for wood is 21% greater than that for UPVC for both Option A and B. This is a result of both higher capital costs and maintenance costs.

1.3.2: 30 Year Whole Life NPV

Table 3.2 presents the results of the 30 Year, whole life NPV assessment. The NPV for wood is 22% greater than that for UPVC for both Option A and B. This is a result of both higher capital costs and maintenance costs.

1.3.3: Sensitivity to Painting Frequency

The wood windows are only very marginally sensitive to painting frequency. Altering the painting frequency by ± 1 year results in a change in NPV of 1% in each instance.

The following conclusions can be drawn regarding the life cycle cost assessment:

The 25 Year NPV for wood profiles is 21% greater than that for UPVC profiles whether replacing 500 or 5,000 standard units per year;

The 30 Year, whole life NPV for wood profiles is 22% greater than that for UPVC profiles whether replacing 500 or 5,000 standard units per year;

The NPVs for the wood profiles are only very marginally sensitive to painting frequency. Altering the painting frequency by ± 1 year results in a change in NPV of less than 1% in each instance.