Galvanize It! Online Seminar

# Life-Cycle Savings

Taking into account construction, transportation, direct, and indirect costs over the life of a galvanized structure leads to what is perhaps the most impacting structural cost analysis, life-cycle cost.

Though initial cost is important, perhaps the most telling cost analysis for a project is life-cycle cost (LCC). Life-cycle cost takes into account not only the initial cost, but the maintenance costs throughout the life of the garage, and the time value of money over the project life utilizing net present value (NPV) and net future value (NFV) calculation.

From day one of the project, simple, easy to erect HDG steel designs will cost less to assemble and save time (and therefore, money) in the construction/installation phase. Because fewer and lighter steel elements are required to do the same amount of work as equivalent concrete, transportation fees are also reduced.

Maintenance-free corrosion protection for 70+ years means HDG steel will not require costly maintenance during use, unlike concrete and painted steel. Therefore, when utilizing hot-dip galvanized steel, often the initial cost IS the life-cycle cost, and the only cost.

## Life-Cycle Cost Calculator

Calculating life-cycle cost can be a very cumbersome task, but the potential headache of running the analysis is much less painful than the reality of unexpected maintenance costs in the future. To ease part of the burden, the American Galvanizers Association (AGA) has developed an automated calculator at lccc.galvanizeit.org that compares the initial and life-cycle costs of HDG to 30+ other steel corrosion protection systems.

The Life-Cycle Calculator (LCC) allows the user to input variables such as environment, coating system type, shop or field application, size of project, and estimated interest and inflation rates. Using calculations based on standard financial equations of net future value (NFV) and net present value (NPV), the LCC delivers a detailed comparison of initial and total project costs and the average equivalent annual cost (AEAC), in a one-page printout.

Visit the online calculator to test the specifications of your project, and see how galvanized steel can save money over the life of your project.

## Life-Cycle Cost Case Study

To examine the initial and life-cycle costs of using galvanized steel, lets take a look at a hypothetical structural steel bridge project developed using realistic parameters. By using the Life-Cycle Cost Calculator, one can see how galvanized steel will provide an 83% cost savings for the bridge.

The cost data used in the online calculator comes from two sources. The paint data comes from a nationwide survey of paint manufacturers conducted by KTA Tator, a consulting firm specializing in protective coatings, in 2008. The galvanizing data was obtained from a 2011 survey of North American hot-dip galvanizers. Here are the parameters for the Einstein Bridge project:

• Project Size: 1,200 tons
• Structure Type: Simple 50-100 high
• Service Life Environment: Industrial
• Design Life 80-Years
• Member Type: Medium Structural
• Paint System: IOZ/Epoxy/Polyurethane. SP-6 Automated surface prep. and 9 mil minimum DFT.
• Inflation: 3%
• Interest: 2%

### Initial Cost

As mentioned before, it is not recommended to analyze only the initial cost for a corrosion protection system. However, if it is the only analysis, galvanizing is still a solid choice in this analysis. As is common, projects with many smaller components and structural steel will yield an initial galvanizing cost lower than most paint systems, as the galvanizing process efficiently accommodates bundles and groups of steel.

 Coating System Initial Cost \$/ft2 Total Hot-Dip Galvanizing \$2.20 \$528,000 IOZ/Epoxy/Polyurethane \$3.87 \$927,720

### Life-Cycle Cost

While the initial cost was competitive, lets now look at the life-cycle cost which is where you really see the savings. Based on the Einstein Bridge example, the life-cycle cost of galvanizing vs. the paint system are as follows:

 Coating System Initial Cost \$/ft2 Total Hot-Dip Galvanizing \$4.61 \$1,106,400 Paint System \$52.24 \$12,537,600

The cost savings for utilizing hot-dip galvanzing is 88% over the 80-year life of the bridge.