What is a life cycle cost analysis?

The notion of Life Cycle Cost (LCC) comes from that of Life Cycle Analysis (LCA). Just as LCA accounts for the environmental impact of a product or service throughout its entire life cycle, the life cycle cost analysis accounts for all the costs of a product or service throughout the same life cycle, these costs often being linked to environmental issues.

The environment-related costs highlighted in the LCC analysis can relate to physical flows (energy, material) and labor costs (facility upkeep, maintenance, service contract, etc.). An LCC analysis reveals internal, external costs and revenue observed at each stage.

The LCC analysis is therefore an economic decision-making aid tool making it possible to choose between several possible investments, by introducing environmental notions into the life cycle description.

The life cycle cost analysis highlights the costs borne by the company, those paid by the customer or consumer and those borne by Society.