ENGR.ECONOMIC ANALYSIS
ENGR.ECONOMIC ANALYSIS
14th Edition
ISBN: 9780190931919
Author: NEWNAN
Publisher: Oxford University Press
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(2.3) You are part of a sustainability consulting team tasked with evaluating the
feasibility of retrofitting an old office building to achieve net-zero energy status. The goal
is to reduce the building's carbon footprint to zero by enhancing its energy efficiency
and installing renewable energy systems. Your task is to calculate the Benefit-Cost
Ratio (BCR) of this retrofitting project to assess its financial viability.
You know the following information about this project:
Total cost of retrofitting measures: $800,000, including:
High-efficiency HVAC system: $250,000
• Window upgrades: $150,000
Thermal insulation: $200,000
Solar PV system: $200,000
Grants and subsidies for green retrofitting: $100,000
Expected annual energy cost savings: $75,000
Additional annual savings (maintenance, etc.): $20,000
Expected lifespan of retrofitting measures: 25 years
Time value of money rate: 7%
Show your calculation process about BCR for the cost analysis.
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Transcribed Image Text:(2.3) You are part of a sustainability consulting team tasked with evaluating the feasibility of retrofitting an old office building to achieve net-zero energy status. The goal is to reduce the building's carbon footprint to zero by enhancing its energy efficiency and installing renewable energy systems. Your task is to calculate the Benefit-Cost Ratio (BCR) of this retrofitting project to assess its financial viability. You know the following information about this project: Total cost of retrofitting measures: $800,000, including: High-efficiency HVAC system: $250,000 • Window upgrades: $150,000 Thermal insulation: $200,000 Solar PV system: $200,000 Grants and subsidies for green retrofitting: $100,000 Expected annual energy cost savings: $75,000 Additional annual savings (maintenance, etc.): $20,000 Expected lifespan of retrofitting measures: 25 years Time value of money rate: 7% Show your calculation process about BCR for the cost analysis.
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