MILCON Analysis, Energy Project

This MILCON (military construction) module supports LCC studies for the Army, Navy, and Air Force when the primary purpose of the study is to assess the costs and benefits of investments in energy and/or water conservation. The module is consistent with DoD's Memorandum of Agreement on Criteria/Standards for Economic Analysis/Life Cycle Costing for MILCON Design, (March 1994). It also follows the rules of the DOE/FEMP Life-Cycle Cost Methodology and Procedures in 10 CFR 436A and fulfills the requirements of Executive Order 13123, Greening the Government Through Efficient Energy Management.

The instructions given in BLCC5 Help apply, in general, to all federal LCC analyses. However, the rules for MILCON analyses include some DoD-specific instructions and terminology:

Middle-of-Year Discounting Convention

All annually recurring costs (OM&R, energy and water costs) are discounted from the middle of the year instead of from the end of the year. (Non-annually recurring and single amounts - for example: phased-in initial costs, major repair and replacement costs, residual value - are discounted from their actual date of occurrence.)

 

Discount rate

In MILCON analysis related to energy or water conservation, BLCC5 will default to the DOE discount rate required by FEMP. The discount rate is updated each April and published by NIST in Energy Price Indices and Discount Factors for Life-Cycle Cost Analysis, NISTIR 85-3273.

 

Initial Project Costs

If the Beneficial Occupancy Date is later than the Base Date, the Initial Project Costs are entered at the "Midpoint of Construction" or can be evenly divided throughout the Planning/Construction Period. The Midpoint of Construction must be halfway between the Base Date and the Beneficial Occupancy Date.

 

Terminology

In MILCON modules the Service Date is referred to as "Beneficial Occupancy Date;"
OM&R Costs as "Routine OM&R Costs;"
Replacement Costs as "Major Repair and Replacement Costs." Non-capital replacement costs for MILCON analyses are entered as "Non-Annually Recurring Routine OM&R Costs."