Life Cycle Costing

Life Cycle Costing (LCC) is an assessment of all costs related to a product or service, over the entire life cycle, from production over use until disposal. In combination with a Life Cycle Assessment that investigates the environmental impact of a product or service, Life Cycle Costing (LCC) can serve to address the economic dimension of sustainability. LCC together with LCA is part of many eco-efficiency approaches.

LCC has a long tradition in industry, especially for those products that have a long life time and/or high maintenance, use or disposal costs. Motivation in these cases comes from both the user and the producer of these products. For the user, the purchase price is only a small share of all costs the product will have, and the overall costs are therefore more important for the purchase decision. For the producer, Life Cycle Costs are a way to demonstrate that certain efforts or investments “pay off”, by reduced use, maintenance or
disposal costs.