Life-cycle evaluation under future uncertainty

Life-cycle evaluation is an essential foundation for sustainable design. It covers both life-cycle costing (LCC, financial) and life-cycle assessment (LCA, environmental). The idea is very simple: when comparing alternative strategies for a construction project, don’t select the cheapest but the one that performs best in the long term.

A durable and efficient building is often better value and more sustainable than a cheaper design with high running costs – but not always. It isn’t certain that greater investment will give higher long term value.

There are two pitfalls to be avoided:

• under-investment when too little is invested: a higher specification would have given benefits that justified the extra investment
• over-investment when too much is invested: the benefits from the higher specification turn out to be too small to justify the extra investment.

In simple cases it can be easy to evaluate the life-cycle performance of alternatives, so long as the question is asked (it isn’t always!). But quite quickly it becomes useful to employ a systematic approach to life-cycle evaluation.

A ‘standard’ method of life-cycle costing was established over 30 years ago and is now set out in guidance documents and international standards. It is easy to apply, but its value is undermined by the assumption that precise data about the future is available. This is rarely if ever the case.

Approaches to life-cycle evaluation that take account of future uncertainty are far more realistic. They give priority to flexible strategies that create ‘life-cycle options’, allowing future decision-makers to respond to unfolding circumstances during the building’s life cycle.

The life-cycle options approach is the best way of carrying out life-cycle evaluation of projects that are subject to uncertainty about future events, which means practically all projects.

How to find out more:

New Generation Whole-life Costing: construction and property decision-making under uncertainty, by Ian Ellingham and William Fawcett (published by Taylor & Francis, 2006).

Whole Life Sustainability by Ian Ellingham and William Fawcett (published by RIBA Publications, 2013).

W Fawcett, M Hughes, H Krieg, S Albrecht & A Vennstrom: ‘Flexible strategies for long-term sustainability under uncertainty’, Building Research & Information vol.40, no.6, 2012.

J Gantner, W Fawcett & I Ellingham: ‘Probabilistic approaches to the measurement of
embodied carbon in buildings’, in F Pomponi, C De Wolf & A Moncaster (eds) Embodied Carbon in Buildings: Measurement, Management, and Mitigation (published by Springer, 2018)