Document a1GXx0vo2L4vqda0B7j0XZrwM

CHAPTER 44. Owninfy an Fixed Charges: ' Amortization, Interest, Taxes,] Insurance, Rent; Maintenance Costs, Service Costs: ' Operating Refrig eration Equipment, Condenser Water, Heating THE purpose of this chapter is to discuss the owning and operating costs of heating, ventilating, air conditioning - and refrigeration systems for buildings from an economic standpoint so that owners or prospective purchasers may compare the operating economics of one system with another and evaluate properly the over-all costs 'of the Systemsinstead of considering only the first cost. There are cases in which it may be desirable to study the possibilities of installing a system for the purpose of obtaining a substantial increase in income or a better return on the investment due-to: increased patron age in theaters, stores, or hospitals;-increased occupancy in office build ings; improved efficiency of employees in offices or factories; or improve- ment in a manufactured product or a decrease in its cost of production. Owning and Operating Costs may be grouped under three headings: (1) Fixed charges, (2) Maintenance Costs, and (3) Service Costs. FIXED CHARGES Fixed Charges, which are the costs of owning the system, include: (1) Amortization, (2) Interest, (3) Taxes, (4) Insurance, and (5) Rent. Amortization Amortization cost will depend on: (1) the total first cost, and (2) the amortization period. The total first cost of an installation is the actual dollar outlay or capital expenditure required to buy and install the air conditioning, or heating and ventilating system ready for operation. It can be divided into two parts: (a) The first cost of the air conditioning or heating and ventilating system itself, and (>), other first costs incurred because of the installation of the air conditioning or heating-and ventilating system. The first cost of air conditioning or heating and ventilating systems includes the following: '' 1`. Heat producing equipment including boilers, burners, etc. -- 2. Heat distributing equipment including direct radiation, piping, etc. 3. Air handling equipment including fans, air heaters, air conditioners, filters, con trols, etc. 4. Air distributing equipment including ducts, outlets, grilles, etc. 5. Refrigerating equipment including piping, pumps, etc. 6. Water conservation devices including towers, evaporative condensers, etc. The best procedure for establishing the first cost of any system is to select the various.parts after thorough engineering study, and then to .estimate the "installed costs of same. When such detailed work is not warranted or when only rough comparisons are desired between several types, approximate unit costs are of value as time savers. Approximate installed prices of the various parts are shown in Tables 1, 2, and 3 and, as indicated, vary with the size or capacity of the equip- 812 Quinine and Operating Costs 813 ment.. The apparatus and items included in each group are stated in the footnotes beneath the tables. ..By use of these three tables it is possible to obtain a reasonable approximation of the cost of heating or air con ditioning a given space-or building. In order to use; the approximate values indicated in Tables 1, 2 and 3, a rough estimate of the load is . required. If time does not permit a determination of the load and if extremely rough figures will suffice, Table 4 may be used as an indication of the price of. various types of air conditioning applications. Other first costs, incurred because of the installation of the air con ditioning or heating and ventilating system, include costs of- electrical wo'rk, plumbing, miscellaneous piping, building alterations! cutting, patching, remodeling, or redecorating after installation, consulting engineer's fees, licenses, permits, etc. These vary so widely that no approximations are possible and each case must be considered alone. The length of the amortization period to be used depends upon: the type and remaining life of the building or space for which the system is to be used; the type of equipment.to be employed as a-part of the system; the character of the business; and the lease or ownership conditions. For small shops in rented quarters on short term leases," a period of 5 years or less may be proper, whereas for larger installations ini buildings thatfare owned outright' a period of 10 or 20 years or more may be used. Depreciation due to deterioration and obsolescence must also be considered in arriving at the amortization period. - Deterioration and Table 1. Typical Installed Costs of Heat Producing and Heat Distributing Systems Btu PER Hour (Millions) SQ FT EDR (Steam) ' Thousands Boiler Horse Power 0.8 1.2 1.6 2.0 3.0 4.0. 5.0 6.0 7.0 8.0 10.0 12.0 14.0 16.0 18.0 3.3 5.0 6.6 ' 8.3 12.5 16.6 20.8 25.0 29.2 .33.3 41.6 50.0 58.3 66.6. 75.0 24 36 48 60. 90 119 149 179 209 239 299 ' 358 *418 478 538 Cost in Dollars--per Million Btu per Hour** b' 1 Boilers Water Tube .2300 2000 1850 .1600 1400 1250 1160 1100 1050 1000 970 930 .900 860 2 34 Boilers Fire-Tube Hot Water System Forced Circula tion Direct' Radiation ' ' System Steam 2100 1750 1570 1460. 1230 1100 980 920 880 850 8500 8200 8000 7800 7600 7500 7500 7500 7500 7500 7500 7500 7500 7500 7500 7850 7600 7350 7200 7000 7000 7000 7000 7000 7000 7000 7000 7000 7000 7000 . ^Columns 1 and 2 include hand fired boiler erected, with shaking grates-and standard.trimmings. Column 1 includes brickwork and rotating soot blowers. Foundations and piping are not included. Columns 3 and 4 include direct radiation, piping, valves, specialties, and insulation. Boilers, condensate and circulating pumps, boiler connections, and all building construction or alterations are not included. hThe approximate figures given above may vary as much as 30 per cent due to job conditions, labor rates, and locality. These figures represent the selling prices of the individual items indicated above based on costs encountered in the year 1940. It is suggested that correction, be made according to the- particular, locality for increases in labor and material costs since that year.