Many organizations only consider the initial purchase and installation cost of a system. It is in the fundamental interest of the plant designer or manager to evaluate the LCC of different solutions. This is before installing major new equipment or carrying out a major overhaul. Evaluation will identify the most financially attractive alternative. As national and global markets continue to become more competitive, organizations must continually seek cost savings that will improve the profitability of their operations. Plant equipment operations are receiving particular attention as a source of cost savings, especially minimizing energy consumption and plant downtime.
Existing systems provide a greater opportunity for savings through the use of LCC methods than do new systems for two reasons. First, there are at least 20 times as many pump systems in the installed base as are built each year. Second, many of the existing systems have pumps or controls that are not optimized since the pumping tasks change over time.
Some studies have shown that 30% to 50% of the energy consumed by pump systems could be saved through equipment or control system changes.
In addition to the economic reasons for using LCC, many organizations are becoming increasingly aware of the environmental impact. This is in regard of their businesses, and are considering energy efficiency as one way to reduce emissions and preserve natural resources.