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Comparisons
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Introduction
Daylight is the preferred source in buildings due to its beneficial effect on human well-being and performance. Its potential to conserve energy and hence protect the environment has stimulated interest as an electric lighting substitute. The recent development of ‘daylight guidance technology’ allows redirection of daylight into areas of buildings that cannot be lit using conventional glazing. The two main guidance types are the commercially successful tubular daylight guidance systems (TDGS) and the newer hybrid daylight/electric systems (HLS). This study of costs and benefits of hybrid systems makes the case for utilizing this form of daylight provider as an alternative to TGDS in combination with a conventional electric lighting system (ELS).
Evaluation method
The methodology used to evaluate system costs and benefits is Whole Life Cycle Costing (WLCC). This provides more realistic comparison data than the simple payback method which is commonly used for lighting system evaluation.
Whole life cycle costing (WLCC)
WLCC takes into account the costs of running and operating buildings (or components) over their lifespan as opposed to a specified period of time. The concept of ‘time value’ reflects the fact that present capital is more valuable than a similar amount of money received in the future. Its computation is based on present value, compounding and discounting techniques [3], which can be computed according to the formulae:
PV = FV (1 + r)-t (1)
FV = K (1 + i)t (2)
Where: PV = present value, FV = future value of capital, K= annual cost, r = discount rate, i = inflation rate, t = period of analysis.
Net Present Value (NPV)
NPV is a variation of WLCC where the PV of cash flow is subtracted...
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...ars is used as being a typical life of lighting equipment. The results of this study are expressed in terms of payback period (PB). For each system in every location the PB curves use electricity prices ranging from 10p/kWh to 50p/kWh. The electricity price median over EU-27 countries in 2009 is 14.01p/kWh, which has risen some 46% in 5 years [7]. The PB shows the annual variation for both system, and electricity, price variation.
Works Cited
Boussabaine H. & Kirkham R. (2004). Whole life-cycle costing, risk and risk responses, Blackwell publishing Ltd.
European Commission (2010). Statistics on focus, (Available at: http://epp.eurostat.ec.europa.eu/portal/page/portal/publications/collections/sif_dif/sif).
Mayhoub M. & Carter D. (2009). Hybrid lighting systems: a feasibility study for Europe, in proceeding of the 11th LuxEuropa, Istanbul, Turkey, 1, 265-272.
Star Appliance is looking to expand their product line and is considering three different projects: dishwashers, garbage disposals, and trash compactors. We want to determine which project would be worth doing by determining if they will add value to Star. Thus, the project(s) that will add the most value to Star Appliance will be worth pursuing. The current hurdle rate of 10% should be re-evaluated by finding the weighted average cost of capital (WACC). Then by forecasting the cash flows of each project and discounting them by the WACC to find the net present value, or by solving for the internal rate of return, we should be able to see which projects Star should undertake.
One of these new innovations is glow in the dark road markings. This new technology uses solar power obtained from the road throughout the day to “charge” the photo-luminising powder that is the glow in the dark lights. Expensive lighting will be replaced with this more cost efficient option that can glow up to eight hours a night. This innovation can already be found on the N329 highway in Oss, Netherlands. Other advancements in lighting to come include wind powered lights and interactive lights. Wind powered street lights will be powered by the gusts of wind created when a car passes by, reducing the need to burn fossil fuels to power the lights. Interactive lights will be turned off but as a car approaches they light up, then fade back away as the car passes by. Smart new technology has the future of roadway systems
Discounted Cash Flow Method takes the forecast free cash flows during forecasted horizon. Then we estimate the cost of capital (weighted average cost of capital) and estimate continuing value (value after forecast horizon). The future value is discounted to the present value. We than add back cash ($13 Million) and non-current assets and deduct total debt. With the information provided several assumptions had to be made to obtain reasonable values (life period of 30-years, Capital expenditures not to exceed $1 million dollars, depreciation to stay constant at $1.15 Million and a discounted rate of 10%). Based on our analysis, the company has a stand-alone value of $51 Million at the end of fiscal year end 1990 with a net present value of cash flows of $33 million that does not include the cash and non-current assets a cash of and non-current assets.
“LED stands for Light Emitting Diode”(“LED definition”). LED is the type of bulb that saves you money when it comes to the light bill. It does not pull much energy unlike other light bulbs. Such as CFL and IND. The CFL (Compact Fluorescent Lamp) light bulbs watts are 15 and the IND (Incandes Lamp) watts are very high. The watts for the IND are 60 so its pulling lots of energy. More than both LED’s and CFL’s. The LED watts are low; its 12.5 watts so not much energy is being pulled (Richard). Its more significant to have LED light bulbs. But most common light bulbs that are being used are the IND bulbs. The reason people use this because they are the cheapest. People now and days do not know anything about CFL LED or IND. Most people think just because IND has more watts and they come in packs and they are cheaper that thats the way to go. This its not the right way to go. The more watts the bulb has the more its going to pull. So thats why people think the more watts the more its going to last and the more brightness its going to bring to the house when they are wrong. Its best to use LED light bulbs. Yes they might be expensive for a pack or a single but when it comes to that light bill it...
Discounted cash flow is a valuation technique that discounts projected cash inflows and outflows to evaluate the potential value of an investment. There are three discounted cash flow methods: Net Present Value (NPV), Profitability Index (PI) and Internal Rate of Return (IRR). The net present value discounts all cash inflows and outflows at a minimum rate of return, which is usually the cost of capital. The profitability index refers to the ratio of the present value of cash inflow to the present value of cash outflows. The internal rate of return refers to the interest rate that discounts cash inflow projections to the present to ensure that the present value of cash inflows is equivalent to the present value of cash outflows (Brown, 1992).
Life-cycle costing and net present value analysis perfectly encourage housing developers to build a green, affordable housing. They can truly see the results through the model. Although every model has weakness and limitation, but outcomes of benefits and savings can help developers to make the right decision, to bring a more green, sustainable building to residents.
Williams, B. 1999. A History of Light and Lighting. [online] Available at: http://www.mts.net/~william5/history/hol.htm [Accessed: 5 Jan 2014].
A carbon credit can be accounted for in many different ways. The top two approaches that have been used by companies as found by Lovell,...
While incandescent light bulbs are not as energy efficient when compared to newer alternative halogen light bulbs, compact florescent lamps (CFL), and light emitting diodes (LED), incandescent light bulbs should not be phased out due solely to their inefficiency. Phasing out incandescent light bulbs will not greatly reduce the level of mercury in the environment; additionally incandescent factories are now closed in the United States due to the phase out, many people in the lighting manufacturing industry have lost their jobs. An examination of the CFL, one of the more predominant alternatives to the incandescent, may reveal shortcomings in the CFLs projected life expectancy, overall quality, and potential health hazards. Instead of incandescent light bulbs being phased out for their inefficiency, compact florescent lamps should be banned for their dangerous qualities.
The Net Present Value (NPV) is a Discounted Cash Flow (DCF) technique that relies on the concept of opportunity cost to place a value on cash inflows arising from capital investment, where opportunity cost is the "calculation of what is sacrificed or foregone as a result of a particular decision".
Nike’s weighted average cost of capital. Obviously, this case aims to evaluate Joanna’s analysis. Throughout the analysis, we will estimate the cost of debt, cost of equity, and cost of capital through different financial analysis models. WACC Approach WACC is the weighted average return on capital that includes both cost of debt and equity, whereby we discount total cash flows by the appropriate discount rates By using the Capital Asset Pricing Model (CAPM), Cohen calculated a Weighted Average Cost of Capital (WACC) of 8.4%. I do not agree with Joanna’s approach for the following reasons.
1) the expected cost of the initial base costs for the acquisition of fixed assets that will be used in the project (buildings, facilities, equipment)
During the last few years, Harry Davis Industries has been too constrained by the high cost of capital to make many capital investments. Recently, though, capital costs have been declining, and the company has decided to look seriously at a major expansion program that had been proposed by the marketing department. Assume that you are an assistant to Leigh Jones, the financial vice president. Your first task is to estimate Harry Davis’s cost of capital. Jones has provided you with the following data, which she believes may be relevant to your task.
First a look at energy costs. Energy costs are rising year after year due to the cost of labor, fuel, overhead, and maintenance required to keep up with the vast demand of energy. Power companies have found a way to recover their rising costs by increasing consumer rates and surcharges. The typical household today has an electrical rate that is over fifty percent energy charge in order to cover these fuel, labor, and administration costs (Xcel Energy). Up to five percent of this rate goes to government regulation costs. These costs are considered variable charges because they change over time. Xcel Energy CEO Ben Fowke states, “Renewable energy is an excellent way to protect customers from high fuel costs” (8). Point of use solar PV systems produce energy where it will be used and have only ongoing maintenance charges as a variable cost. This cost is usually minimal because the average warranty on most solar PV systems is twenty to twenty-five years (Xcel Energy). Once installed, point of use solar PV syst...
Energy Efficiency refers to the use of energy on the same level, performance, comfort, suitability. As the world progress through technologies, more energy is required to power the world through various sources. Society has reached a point of our civilization when electricity is used for all purposes and therefore our presence will be impossible without it. However increasing amount of energy used will lead to numerous social and economic problems. Electricity demand is increasing twice as fast as overall energy use and is likely to rise by more than two-thirds 2011 to 2035. In 2012, 42% of primary energy used was converted into electricity. In the near future, cities will need to become increasingly energy efficient to deal with them. There are three strategies to attain energy efficiency which have their benefits.