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TM_E_1185_
_15
Designation:E118515Standard Guide forSelecting Economic Methods for Evaluating Investments inBuildings and Building Systems1This standard is issued under the fixed designation E1185;the number immediately following the designation indicates the year oforiginal adoption or,in the case of revision,the year of last revision.A number in parentheses indicates the year of last reapproval.Asuperscript epsilon()indicates an editorial change since the last revision or reapproval.1.Scope1.1 This guide identifies types of building design andbuilding system decisions that require economic analysis andrecommends ASTM practices,adjuncts,and computer pro-grams that may be used to implement the appropriate economicmethods for each decision type.2.Referenced Documents2.1 ASTM Standards:2E631 Terminology of Building ConstructionsE833 Terminology of Building EconomicsE917 Practice for Measuring Life-Cycle Costs of Buildingsand Building SystemsE964 Practice for Measuring Benefit-to-Cost and Savings-to-Investment Ratios for Buildings and Building SystemsE1057 Practice for Measuring Internal Rate of Return andAdjusted Internal Rate of Return for Investments inBuildings and Building SystemsE1074 Practice for Measuring Net Benefits and Net Savingsfor Investments in Buildings and Building SystemsE1121 Practice for Measuring Payback for Investments inBuildings and Building SystemsE1369 Guide for Selecting Techniques for Treating Uncer-tainty and Risk in the Economic Evaluation of Buildingsand Building Systems2.2 Adjuncts:Discount Factor Tables Adjunct to Practices E917,E964,E1057,E1074,and E112133.Terminology3.1 DefinitionsFor definitions of general terms related tobuilding construction used in this guide,refer to TerminologyE631;and for general terms related to building economics,refer to Terminology E833.4.Significance and Use4.1 Standard practices for measuring the economic perfor-mance of investments in buildings and building systems havebeen published by ASTM.A computer program that produceseconomic measures consistent with these practices is avail-able.4Discount Factor Tables has been published by ASTM tofacilitate computing measures of performance for most of thepractices.4.2 This guide can be used to:(1)identify types of buildingdesign and system decisions that require economic analysis;(2)match the technically appropriate economic methods with thedecisions;and(3)locate the methods in the ASTM practicesand adjuncts listed in Section 2.4.3 More than one method can be technically appropriatefor many building decisions.Therefore the choice in practiceof which technically appropriate economic method to use forevaluating a particular building decision will often depend onthe perspective of the user.Some examples of factors thatinfluence the user are:(1)ease of applying the methods,(2)level of familiarity of the user with the methods,(3)preferenceof the user for different methods,and(4)presence of budgetlimitations for the projects.4.4 This guide identifies some features and limitations of themethods that might influence users choices under varyingconditions.5.How to Use This Guide5.1 Table 1 indicates which standard practices(that is,economic methods)are technically appropriate for the follow-ing four types of building investment decisions:acceptance/rejection,design,size,and priority.5.1.1 In the context of this guide,an acceptance/rejectiondecision pertains to the cost effectiveness of an individualbuilding or building system.This type of decision is made1This guide is under the jurisdiction of ASTM Committee E06 on Performanceof Buildings and is the direct responsibility of Subcommittee E06.81 on BuildingEconomics.Current edition approved Oct.1,2015.Published October 2015.Originallyapproved in 1987.Last previous edition approved in 2012 as E1185 12.DOI:10.1520/E1185-15.2For referenced ASTM standards,visit the ASTM website,www.astm.org,orcontact ASTM Customer Service at serviceastm.org.For Annual Book of ASTMStandards volume information,refer to the standards Document Summary page onthe ASTM website.3Available from ASTM International Headquarters.Order Adjunct No.ADJE091703.4The NIST Building Life-Cycle Cost(BLCC)Computer Program helps userscalculate measures of worth for buildings and building components that areconsistent with ASTM standards.The program is downloadable from http:/energy.gov/eere/femp/building-life-cycle-cost-programs.Copyright ASTM International,100 Barr Harbor Drive,PO Box C700,West Conshohocken,PA 19428-2959.United States1 independently of other project evaluations.It focuses on themerits of a single choice rather than on determining the mostcost-effective design or size.5.1.2 A design decision pertains to choices among compet-ing designs for an individual building or building system,where only one design can be chosen.5.1.3 A sizing decision pertains to choices among compet-ing sizes or investment levels for an individual building orbuilding system,where only one size or level can be chosen.5.1.4 A ranking