Probabilistic approach for predicting life cycle costs and performance of bridges

• Type: Article in International Conference Proceedings Book
• Date: 2006

Authors

Silva, AP (Author) Other; Fernandes, AA (Author) FEUP

Conference proceedings International

Title: Proceedings of the 3rd International Conference on Bridge Maintenance, Safety and Management - Bridge Maintenance, Safety, Management, Life-Cycle Performance and Cost

Pages: 927-928

3rd International Conference on Bridge Maintenance, Safety and Management - Bridge Maintenance, Safety, Management, Life-Cycle Performance and Cost

Porto, 16 July 2006 through 19 July 2006

Indexing

ISI Web of Knowledge

Scopus - 3 Citations

Other information

Authenticus ID: P-007-P0M

Abstract (EN): The construction industry is a major consumer of non-renewal resources. Life Cycle Costing (LCC) enables the whole life cost and performance of bridges to be optimised and so can make a major contribution to sustainable development. The increasing use of procurements arrangements such as the Private Finance Initiative (PFI) and the Public Private Partnership (PPP) has focused stakeholders on the whole life cost and not simply on the lowest capital cost. This has led to a demand of LCC models that can provide uncertainty quantification in addition to accurate forecasts and estimates. The quantification of the overall risk exposure, throughout risk analysis, will help the design team to concentrate on the most critical elements, avoiding in this way waste, though over-design, or costly premature deterioration. Life cycle costing may be defined as the estimation of the costs of acquiring and operating an asset over its intended service life. Within the construction and property sectors, life cycle costing seeks to consider all the costs and revenues (incomes) associated with building, operating and disposing of buildings and built infrastructure. In particular, life cycle costing may be used to facilitate choices where there are alternative means of achieving the client's objectives. These alternatives usually differ not only in their initial costs but also in their future costs (i.e. during the operation and disposal phases). Life cycle costing may also be used to estimate the total costs of a single asset, so that appropriate provision can be made to finance it. LCC may be used at all the important decision stages in the asset life cycle including procurement, construction, operation and finally the disposal of the asset. For example, LCC may be used to ¿ inform the initial investment appraisal or decision whether or not to build or acquire by purchase or lease ¿ assess of feasibility of alternative construction solutions, including replacement and/or maintenance over the life of the asset ¿ support the outline design ¿ support the detailed design (including choice of components and services) ¿ support tender appraisal ¿ assess the impact of variations during the course of construction ¿ support hand-over and final account ¿ assess of the effectiveness of the construction (post-occupancy evaluation). At each decision stage of a project additional and more reliable information becomes available and the calculation of the life cycle costs may be refined to provide increased accuracy of estimates of the life cycle costs of the project. The aim must be to achieve recognition of the optimum life cycle cost of the asset, balancing the optimum value, the minimum overall life cycle cost and the maximum functionality. The process of life cycle costing is, in itself, very simple and many programmes exist to enable life cycle costs to be calculated. The skill in estimating life cycle costs is in modelling performance in order to be able to predict when interventions are required and hence to estimate when the associated costs will be incurred. It is recognised that predictions are exactly that and are likely to differ in quantitative terms from reality, particularly when predicting future events. The skill in LCC is therefore to understand the extent to which real costs may differ from the estimated cost and to use this understanding to manage the financial risk. To enable this to be achieved, a probabilistic approach has been adopted which takes account of uncertainties and quantifies the likelihood of deviations from the estimated LCC. This approach helps both to overcome concerns about uncertainties in forecasting, which have proven to be a major obstacle in to the application of LCC in construction, and to provide a more robust and transparent method for management of the financial risks. The present paper reports research work in progress aiming to develop a life cycle cost and performance (LCCP) model to optimize the life cycle cost and performance of bridges and provide a more robust and transparent method for management of the financial risks. The approach adopted consists of three distinct elements, a probabilistic life cycle cost model, a probabilistic deterioration model and the decision support application. The integrated model enables fhe analyst to calculate the LCC results probabilistically, for different scenarios of analysis, using Monte Carlo simulation. As follows, the model is innovative in that it provides to the decision maker the ability to understand and manage financial risk relating to the life cycle of an asset with a greater degree of transparency and rigour than is currently available. A software tool has been developed that allows a probabilistic sensitivity analysis to be performed both at the planning stage to support go/no-go decisions on major investment or to understand project trade-offs at concept or detailed design phases. © 2006 Taylor & Francis Group.

Language: English

Type (Professor's evaluation): Scientific