Life-Cycle Cost Analysis of Infrastructure Projects - Governing the Nexus: Water, Soil and Waste Resources Considering Global Change - page 114

air, etc., emissions or effluents that directly affect livelihoods, health, etc.; long term
impacts like GHGs, etc. These impacts could be positive or negative. They could
take place within the sector or product that is being assessed or any other sector
linked to the core sector.

Box 1: Cost Components

Fixed costs
CapExHrd: Includes government expenditure on infrastructure such as
water sources, pumps, storage,

filters, distributions systems, etc.
HHCapExHrd: Includes household expenditure on infrastructure such as
water storage, toilets, wells, pumps, etc.
CapExSft: Includes government expenditure on planning and designing
costs of the schemes.
Recurring costs
CapManEx: Includes capital maintenance such as rehabilitation of
sources, systems, etc.
CoC: Includes the interest paid on the borrowed capital for investment in
the WASH sector.
ExDS: Includes staff salaries, and post implementation activities such as
IEC, demand management, and training of mechanics.
ExIDS: Includes policy planning at the macro level, i.e., central and state.
OpEx: Includes regular operation and maintenance of the systems such as
energy costs, minor repairs, filtering costs, salaries of water man, etc.

HHOpEx: Includes household expenditure on operation and maintenance
of water systems, sanitation facilities, etc.
RTCost: Retirement

costs include the termination costs of the

infrastructure
Costs of environmental externalities
Include resource degradation costs within sector and in other sectors that are
linked to the core sector.

3.2 Discount Rates, Annualization and Functional Unit

All the fixed capital investments are being made over the years and are hence

cumulated over the years, as are bene t flows. When LCCA is adopted at the initial

stages of the project, the capital or fixed investments are made in the current year

and the recurring investments are made in the future years over the life of the
system. Some of these costs are regular and expected (operation and maintenance)