What is meant by life cycle costs?
Life cycle costs describe the costs of a product, system or project throughout its entire life. Alongside the procurement costs, secondary costs (e.g. electricity, water, maintenance) are also considered when calculating life cycle costs.
The concept of life cycle costs is particularly important to properly assess the attractiveness of (investment) projects.
Public clients can demand a calculation of life cycle costs in order to prove that a supply or service meets certain characteristics required in the tender specifications.