Whole-life value
Value relates to assessment of the benefits brought by something in relation to the resources needed to achieve it. In the context of construction projects it is normally expressed as a ratio between a function and the whole life cost for that function.
Value = function / whole life cost
Where the term 'whole life value' (WLV) refers to the process of assessing a project based on its long-term value and social impacts. This is different from whole life costs (WLC) which considers costs associated with the life of the project itself; its construction, operation, disposal, etc.
Whole life value is closely linked with sustainability and how environmentally-friendly the project is. In calculating the WLV the following considerations may be taken into account:
- Energy costs associated with the project.
- Facilities management costs and quality.
- Potential costs of retrofitting.
- Durability and resilience.
- Fitness-for-purpose.
- Long-term value to society (e.g. a road tunnel that reduces journey times and therefore, energy consumption).
Issues that can sometimes conflict with whole life value might include; environmental impact, economic performance, technical viability, client’s requirements, and so on.
The building sector is increasingly aware of whole life value, with lower emission rates, corporate social responsibility considerations, life cycle assessment, increasingly strict environmental standards and so on. In particular, WLV has been promoted as a method for assessing long-term projects such as private finance initiative (PFI) projects.
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