- Europe and Central Asia
Sector of activity
Type of initiative
Capacity Building & Implementation, Policy Frameworks & Tools
Type of lead actor
Government / public sector
When purchasing goods and services, the most inexpensive offers are often not the most economic ones. Inexpensive products might cause higher follow-up costs compared to more expensive alternatives. Such higher costs might arise, for example, from the consumption of auxiliary materials or energy during the usage phase, the installation and maintenance costs and the costs at the end of the useful life (in particular costs for picking up, disposal and recycling). This includes the costs arising from external effects of the environmental pollution which are associated with the advertised capacity during the life cycle. Life Cycle Costing includes these factors in the calculation of the actual costs for a product. For that reason, the method can also be used to promote environmentally friendly products and thus contribute to relieving the environment.
A product-group specific Excel tool of the German Environment Agency provides assistance in the calculation of life cycle costs of computers, multi-functional devices, monitors, computing centres, floor coverings, refrigerators and dishwashers. It considers all essential cost categories, such as cost of acquisition, operating costs and costs of disposal.
The tool has last been revised in 2018. New product-groups have been included. It is being offered to procurers on the central procurement website of the German Environment Agency (www.beschaffung-info.de, website available in English), accompanied by a training script regarding the use of life cycle costing in procurement (forthcoming).
Impact and Results
By providing the LCC tool with all relevant data and an easy to fill in operating mask, the barrier to implement life cycle costing into the tendering is lowered significantly. This enables procurers to emphasize environmentally friendly products with manageable effort.
Next steps and how to get involved
Download the LCC-tool (in German): https://www.umweltbundesamt.de/en/topics/economics-consumption/green-procurement/life-cycle-costing
Download the training script (in German – Winter 18/19):