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Last edited 27 Jan 2023
The Green Book, Central Government Guidance On Appraisal And Evaluation, Published by HM Treasury in 2018, suggests that: ‘External Costs are costs of production or consumption of a good which are not taken into account by individuals or included in the price of a good in a perfectly competitive market.’
ICMS: Global Consistency in Presenting Construction Life Cycle Costs and Carbon Emissions, 3rd edition, November 2021, published by the ICMS (International Cost Management Standard) Coalition, defines external costs as: ‘Costs associated with an asset that are not reflected in the transaction costs between provider and consumer, collectively referred to as Externalities. These costs may include business staffing, productivity, social impact costs and user costs and can be considered in a Life Cycle Cost analysis when explicitly identified (ISO 15686-5).’
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