Maintaining the facilities that power and cool ICT operations is just as important as the maintenance and repair of the ICT systems themselves. There is a life cycle cost associated with the power and cooling equipment, similar to that for ICT systems.
It is not unusual for the power and cooling equipment to have a long life, as much as 20 years. So this equipment can sometimes be taken for granted. It is also probable that the IT management has changed since the power and cooling equipment was installed. The new IT manager may have little or no knowledge of the existing equipment's health.
Questions to ask when it is time to consider a new energy investment:
1. What is the cost to maintain an asset over its operating lifetime?
2. How many maintenance and repair labor hours will be required and at what cost?
3. What is the history for the maintenance and repair of the assets over the last 20 years?
4. Are there cost differences at different enterprise sites?
5. What are the asset life times?
6. What are the inflationary costs over the projected life time?
7. What is the correct funding level for the asset maintenance and repair?
When these energy investments come up for refresh, then it is time to perform a Life Cycle Cost analysis. The analysis should include the:
* Initial purchase and installation cost
* Cost to finance the purchase and installation
* Energy charges over the lifetime of the equipment including the inflationary increases
* Maintenance and repair costs including the inflationary increases
* Disposal cost
* Residual value of the equipment if it can be sold as used equipment
* Cost to replace the equipment
This analysis is similar to the one performed by a vehicle fleet operator.
The enterprise cash flow will vary over time. Capital funds may be easier or harder to obtain at certain times. Most IT managers are not the CFO, so there is usually less knowledge about the cost and value of money. An analysis must be performed that converts the future cash flow into present day dollars, something the CFO can determine.
A Life Cycle Cost (LCC) calculation should identify and include all of the costs. The calculation should use the following formula:
LCC = Initial costs + finance charges + energy charges + operational, maintenance & repair costs + replacement cost + disposal cost - residual value
Collecting the relevant information may not be easy since the lifetime of these types of equipment may be 20 years. There probably is no one on the IT staff to provide the analysis. It is also probable that the LCC was never carried for the existing installation(s) so there is no benchmark for comparison or previously accepted calculation methodology. If this is the case, then an energy design consultant may be necessary. Many electrical utilities also offer design services to support the equipment selection and cost analysis.
The IT management must work with the facilities management to develop the best plan for the enterprise. This effort usually cannot be performed without facilities management input.
The enterprise may find that a higher initial investment can produce a lower energy bill. Another possibility is selecting equipment with a higher residual value. The LCC calculation can be exercised with different design scenarios to determine the best solution.
A good resource is the "Facility Maintenance and Repair Cost Reference 2010-2011 (15th Edition)" by White Stone Research.
