Professional Documents
Culture Documents
1. INTRODUCTION............................................................................................................................11
6. FUTURE DEVELOPMENTS.......................................................................................................119
7. CONCLUSIONS.............................................................................................................................125
8. REFERENCES ...............................................................................................................................128
9. BIBLIOGRAPHY ..........................................................................................................................130
APPENDICES..........................................................................................................................................137
APPENDIX 1............................................................................................................................................138
CHAIRMAN ........................................................................................................................................138
REPORT DRAFTING SUB-GROUP ........................................................................................................138
SUB-COMMITTEE MEMBERS..............................................................................................................138
COMMENTS ON REPORT RECEIVED ...................................................................................................140
APPENDIX 2............................................................................................................................................143
GLOSSARY OF TERMS........................................................................................................................143
APPENDIX 3............................................................................................................................................151
QUESTIONNAIRE SURVEY................................................................................................................151
APPENDIX 5............................................................................................................................................173
D. Colwill
Chairman Technical Committee 8
Whole life costing, or life cycle costing, has been used for many years in various sectors
of industry (e.g. buildings) and has been defined in a number of ways. Specifically for
roads, Life-Cycle Cost Analysis was defined in the USA, in the Quality Improvement of
the National Highway System NHS Designation Act of 1995, to be:
... a process for evaluating the total economic worth of a usable project segment by
analysing initial costs and discounted future costs, such as maintenance, user,
reconstruction, rehabilitation, restoring and resurfacing costs over the life of the project
segment (a usable project segment is a portion of the highway which could be opened
to traffic independent of some larger overall project).
"To give priority to the maintenance of trunk roads and bridges with the broad objectives
of minimising whole life cost" (5).
In the same way, the Federal Highways Administration in the United States and the
sponsors of HDM4, the UK Department For International Development, the World Bank,
the Asian Development Bank and the Swedish National Road Administration, have all
seen the need for an up-to-date method for analysing the whole life costs of road
pavements.
The importance of whole life costs, and the wider issues of whole life performance were
identified in the PIARC Strategic Plan and taken up at the Committee meetings in Paris
in 1996. The Flexible Roads Committee (CT8) and the Concrete Roads Committee
(CT7) agreed to form Sub-Committees on Whole Life Performance and Whole Life
Costs respectively.
These Sub-Committees have collaborated during this period and a joint paper has been
published by Bowskill and Huvstig in Routes/Roads (4). The report presented here has
however been produced on behalf of the Flexible Roads Committee alone. A list of
members of the Whole Life Performance, Sub-Committee 3, of Technical Committee
CT8, is provided in Appendix 1.
This report concentrates on aspects of whole life costs of road pavements with other
aspects of whole life performance being considered in the Committee CT8 Activity
Report. This Sub-Committee report also includes the findings from a questionnaire
conducted within the CT8 membership.
There is of course a major role for whole life costing of other parts of the highway as
well as the road pavement. Integrated systems are now being developed which
combine the analyses of these separate features (e.g. pavements, bridges, earthworks)
to allow for the inclusion of interactions and combined maintenance works which
improve the overall cost effectiveness. In the next few years it is expected this area of
development will see a high level of activity but, at this time, this report will concentrate
on road pavements and discuss only briefly the links to the analysis of other parts of the
road. It should be noted, however, that there are many aspects of the approach
adopted for road pavements that clearly apply to other parts of the highway
infrastructure.
1. Project Inception
For a new road, the cost of constructing the road to last its required life, derived from
average unit costs, can be compared with the benefits to be accrued by the traffic
expected to use the new road. These benefits arise from reductions in journey time,
accident costs and vehicle operating costs that may come from a wider, flatter and
straighter road compared with the existing route.
Detailed techniques have been available for some years to assess the earthworks
quantities associated with different road alignments. These models require considerable
volumes of data to estimate the engineering costs and are used more often when the
horizontal alignment for the route has been set. Few of these models include the user
costs resulting from the alternative alignments. Simplified models of earthworks costs
have been included in the World Banks Highway Design and Maintenance Standards
Model (HDMIII), the recently enhanced version, HDM4 (17, 23), and the Transport
Research Laboratory (UK) Road Transport Investment Model, RTIM (19) and these
allow the user costs associated with the different alignments to be included in a whole
life cost analysis.
This type of analysis allows the merits of alternative new routes to be examined.
Although, at this stage, allowance is made for the maintenance of the road during its
life, analyses do not usually consider the type of pavement or the condition of the road
in detail.
2. Road Design
Once the general route has been decided, there are still detailed options associated
with the design of the road. The alignment of bridges can have a significant impact on
their initial cost as can the horizontal and vertical alignment of the pavement. For many
years computer programs have been available for analysing the earthworks required for
alternative route alignments. Most of these analyses are carried out to enable
contractors to balance the earthworks material movements and do not take into account
the future vehicle operating costs resulting from the alignment of the pavement.
However, in terms of the whole life costs associated with the road, an increase in initial
cost to provide an improved vertical or horizontal alignment may be more than repaid by
reductions in vehicle operating costs and accident costs during the life of the road.
The options for pavement type and expected pavement life can be investigated. Many
highway authorities have developed design standards from an analysis of the costs
associated with the future maintenance requirements as well as the expected
performance of the materials in the road (7). In the United Kingdom the choice of a
design life of 40 years, with appropriate strengthening of flexible pavements after about
20 years, was selected on the basis of a simple whole life cost analysis in 1984. The
use of existing standards may, however, still allow the assessment of the costs on a
particular length of road to show the advantages and disadvantages of different design
lives. A long design life may be worthwhile on a heavily trafficked road where any
maintenance will incur high costs from disruption to the traffic. On more lightly trafficked
roads, a thinner design may be possible because the future maintenance has less
impact on the traffic. Alignment plays a further part in the whole life costs of a road
when the bridge clearance requirements are specified. In addition to allowing the free
flow of vehicles along the road from the time of construction, consideration should be
given to the clearance required after any change in height of the pavement surface,
resulting from maintenance during the life of the pavement. Maintenance costs increase
significantly if it is necessary to maintain the clearance height by excavating under a
bridge or raising the height of a bridge.
3. Construction
Equivalent pavement designs using different materials may have different construction
costs and significantly different future maintenance requirements on the same length of
road. These combine to give different whole life costs and an opportunity to examine
these costs to provide a minimum whole life cost even though it may incur a higher
initial cost. For example, recent research (17) has shown that thicker asphalt pavements
can provide a very long structural life, without the need for strengthening, provided
adequate surface maintenance is undertaken. Figure 2 shows there is a minimum
thickness where this behaviour applies (at approximately 80msa in the design chart)
and it may be worthwhile, in terms of whole life cost, to build a new pavement to that
thickness rather than a thinner design which may appear to be sufficient based on
current traffic forecasts but will require more maintenance in future years.
500
DBM
400
DBM50
HDM
Th ckness
i 300
of asphal t
layers
(mm) 200
100
0
1 10 100 1000
Design l i e mill
f ( on standar
i axles
d )
DBM - Dense Bitumen Macadam HDM - Heavy Duty Macadam
DBM50 - Dense Bitumen Macadam (50pen binder)
Figure 2. UK Design chart for alternative types of asphalt pavements (7)
4. Maintenance
Maintenance costs are predicted at a general level when examining the route alignment
and the design of the road. A more detailed assessment can be made when comparing
different pavement types at the time of construction but it is only when there is an
existing pavement, with measurements of the current condition of the pavement, that a
fully detailed analysis of the future costs associated with that pavement, can be
undertaken. At this stage, the analysis can take into account the actual performance of
the pavement and allow a comparison of appropriate maintenance options.
Maintenance treatments are designed taking into account the current condition of the
pavement and the expected future performance requirements of the road. However, an
essential part of this is the assessment of the current condition of the pavement and this
may be a major factor in the final whole life cost. If the assessment techniques are slow
and cause disruption to road users (e.g. by lane restrictions), there may be a tendency
for road authorities to reduce the frequency of condition measurements and to limit the
parts of the road surveyed. It is then possible that options for maintenance of the
pavement are missed because deterioration has progressed too far.
Good quality information on the condition of the pavement significantly improves the
analysis of the whole life costs of maintenance options by providing a more accurate
representation of the current condition and ensuring relationships developed for the
prediction of future pavement condition are based on actual performance. Many simple
data collection techniques have been developed over many years and the new
sophisticated equipment can be very expensive using up to date electronic components
and processing techniques. Nevertheless, the achievement of reductions in whole life
cost can more than justify the extra costs of the new survey techniques.
The work of this sub-committee of CT8 has mainly considered countries with developed
economies, however, the approaches are applicable to all economies. The development
of HDM4 (16) has shown that the approach is also needed in countries with emerging
economies. It may, however, be that the components of whole life cost take on different
importance in different countries.
As the traffic carried by road networks throughout the world continues to increase, it is
essential that management of the highway takes a long-term view so that congestion at
roadwork sites only occurs when it cannot be avoided. One of the tools that can assist
the engineer in developing acceptable overall management policies and strategies is
whole life costing. This is not a precise science and the approach will not provide all the
answers for the engineer but it is a tool to help in the comparisons to identify and select
those options giving best value for money. There are several other factors involved in
identifying the most cost effective maintenance solution other than whole life costing but
whole life costing can contribute in a number of ways to the multi-criteria analysis. Not
least of these are the comparison of options for construction and maintenance and the
use of sensitivity analysis, which may form part of an overall risk analysis for each of the
options.
Highway administrations in different countries do not all use the same definition for
whole life costing. For example, some countries include only works costs while other
countries consider different categories of costs to the road user, in addition to the works
costs of construction and maintenance. It is not possible to show all of the definitions
adopted for whole life costing but the description below shows how each of the
components can be included, if required, for a particular analysis.
Costs are incurred during the life of a road by the highway authority responsible for the
road at each stage of its life (design, construction, operation, maintenance,
replacement), by the road users and by other members of the public who are affected
by the road (e.g. local residents). Although these costs are incurred over the whole life
of the road, in practice, the whole life cannot be considered and a long analysis period
is used to represent the full life of the road. In current whole life cost analyses, only a
sub-set of all of the costs is considered, depending on the information available.
However, it is generally agreed that for a length of road, the whole life costs fall into the
three categories shown in the pie chart in Figure 3. The charts represent the costs of a
heavily trafficked road in England over a period of 30 years. Figure 3(a) represents the
costs during an analysis period which includes the pavement construction, while Figures
3(b) and 3(c) represent the costs for the same pavement during an analysis period
which commences immediately after construction and the components of future cost
can be seen more clearly.
Construction cost
Future works
costs
User costs
(b) Future works costs after (c) Future user cots after construction
construction
Traffic
management
Traffic delays
Strengthening
treatments Accidents
Surfacing
treatments
The three components of whole life cost represent the construction of the pavement, all
aspects of maintenance works carried out on the pavement and the social costs that are
incurred during the life of the pavement. The social costs are often referred to as user
costs but which may also relate to people other than road users. The construction and
maintenance works costs may be referred to as direct costs to the highway authority
whereas the other costs are indirect. Some organisations and whole life costing
systems consider these types of costs differently.
On heavily trafficked paved roads, the user costs include mainly the delays to road
users at roadworks with a small proportion made up of the costs of the extra accidents
that occur at roadworks.
Whole life costing applies equally to unpaved and paved roads. For unpaved roads the
principal considerations are material loss and roughness of the pavement surface,
which lead to high user costs due to increased vehicle operating costs. In the pie charts
in Figure 3 the user costs for unpaved roads would be represented by vehicle operating
costs.
After selection of the route of the road, the detailed design leads to construction
alternatives using different pavement types. Analysis of the predicted future
maintenance costs for each pavement type may then be used to select the construction
type which is expected to provide the lowest whole life cost. The predicted maintenance
profiles in Figure 4 show the cost, time of maintenance and type of maintenance for the
same road and over the same time period, but with asphalt and jointed concrete
pavement types.
It is important to note that whole life costing is not limited to applications for new roads.
The life cycle analysis may be assumed to start at any time during the life of the road
and used to identify the consequences of alternative maintenance options for the
existing road. During the life of the road, maintenance work is carried out both on a
routine basis and to restore different specific aspects of condition. For non-routine
maintenance, selection of the type of treatment has, for many years, been made with
the aid of a management system. Traditional approaches in these systems are based
on treating those roads in the worst condition first. More modern systems adopt
economic approaches that involve the prediction of the future performance of the
pavement, with and without maintenance, and the use of measures of the economic
attractiveness of each of the maintenance options. In the United Kingdom, the UKPMS
pavement management system (22) and the HAPMS pavement management system
for trunk roads (13) both use the benefit-cost ratio techniques, similar to that used in
HDM4 (16), to prioritise maintenance work on a whole life cost basis.
For the selected maintenance treatment, the total cost of the work includes the costs of
preparing the road for the main treatment (e.g. preparatory pavement patching), the
costs of the main work and finally the costs of any work required before the road can be
re-opened to traffic (e.g. work on safety fences). Included in these costs are also the
costs of the traffic management measures to allow the traffic to continue to use the road
while the maintenance works are being undertaken. On heavily trafficked roads, the
costs of the traffic management make a very significant contribution to the total cost and
may, on occasions, exceed the costs of the maintenance work, as shown in Figure 4.
Cost
User cost
Works cost
C R O R
C R O R
Undiscounted costs
Discounted costs
Cost
User cost
Cost
Works cost
C S T/S S F/S S
C S T/S S F/S S
Discounted costs
Undiscounted costs
The component of the total cost that arises from construction is usually the most
accurately estimated of all the components. However, care is needed to ensure that
inappropriate unit costs of construction or maintenance do not favour a particular
solution. For example, use of a low cost for the maintenance of a pavement surface
may lead to an under-estimation of the future cost of that pavement type.
The maintenance policy adopted for a road determines the level of condition and the
maintenance carried out during the life of the road. In whole life cost analyses of
construction and maintenance options it is generally only the changes in road user costs
associated with the maintenance policy which are considered because all options can
be assumed to have the same costs associated with normal use of the road. As traffic
levels increase, the costs of normal use, which include the costs of network congestion,
become much larger than any of the costs associated with pavement condition and
maintenance works.
Changes in user costs result from increased time costs, due to delays to traffic at the
time of maintenance, and changes in vehicle operating costs due to different levels of
condition during the life of the pavement. If higher levels of condition are achieved
during the life of the pavement by increased maintenance, although there may be
increased delays to traffic during the maintenance works, lower vehicle operating costs
due to the better pavement condition can be expected. This is one of the trade-off
analyses that may form part of the examination of whole life costs.
For levels of condition currently found on the major roads in Europe, North America and
Australia, the effect on vehicle operating costs due to the change in pavement condition
is small compared with the total costs associated with carrying out road maintenance
work.
For minor roads in developed countries, traffic levels are lower and delays may also be
lower, but the levels of condition then mean that user costs from increased vehicle
operating costs should be taken into account.
The accident rate at roadworks varies with the traffic management arrangements
adopted during the period of maintenance. Therefore, the choice of maintenance
options must also include the identification of lanes remaining open to traffic during the
periods of maintenance work. In England, it has been established that the accident rate
can increase by more than a factor of 2 during road maintenance, even when adopting
sophisticated traffic management arrangements (14). Another study in Germany, (18),
has shown that the accident rate on motorways may increase by up to a factor of 12
when the maintenance work requires contra-flow traffic management at the
maintenance site.
Environmental costs of traffic have been examined for many years and form a
significant component of the total costs associated with the life of a road. In whole life
cost analyses of alternative road pavement options, it is again necessary to consider
only the environmental costs that change between the options. For example, if the level
of winter maintenance is the same in two options, the environmental cost of the de-icing
chemical is the same and need not be included.
If, however, costs do change for the options, then these differences should be included.
For example, if one pavement type results in a higher traffic noise level than another,
then the increase in cost resulting from that higher noise, by the provision of noise
reduction measures (e.g. noise barriers), must be included. This type of analysis is not
currently included in many of the approaches adopted for roads in the countries
represented in the Sub-Committee. However, the use of special pavement surfaces
which reduce the traffic noise (e.g. porous asphalt) can be examined using the whole
life cost to compare any increase in the cost of provision and reduced life, with the
benefits of reduced noise during the life of the road.
In recent years, however, alternative ways of carrying out whole life analyses of roads
have been developed to take other environmental considerations into account. For
example, the energy necessary for the construction and maintenance work has been
used to compare options and the amount of scarce aggregates has been included in
comparisons of maintenance options rather than relying on a cost analysis alone.
The impacts of the different components of whole life cost vary with the type of road and
the importance of the various components of whole life cost may also be different. For
example, for a road in a country with a less developed economy, the vehicle operating
costs may take a much larger proportion of the total cost, whereas for a heavily
trafficked motorway in a developed economy, the delays at maintenance works sites are
likely to be the larger part of the total cost.
In countries with less developed economies, the levels of pavement condition are
generally lower. Fuel costs and other vehicle costs are relatively high and the vehicle
operating costs are therefore large. The value of peoples time is, however, relatively
low and, even though many vehicles may still be delayed by roadworks, the cost of the
delays is low.
For countries with developed economies, traffic volumes on the principal roads are
generally larger and the value of peoples time is also much higher. The costs of delays
are also, therefore, correspondingly high. In these countries, on lower hierarchies of the
road network, there are fewer vehicles and the condition achieved through maintenance
policies is lower than on the principal roads carrying most of the traffic. However, the
pavement condition is such that the vehicle operating costs do not become large, due to
the small number of vehicles, and, hence, the delay costs are also small. The overall
effect on the lower road hierarchies is for user costs generally, to become small rather
than for vehicle operating costs to become an important component, as in less
developed economies.
Similarly, there is a much stronger need for a government highway authority to consider
the impact of costs incurred by the road user than there is for private road operators to
do so. Although private operators generally try to take disruption to users into account, it
is often more important to assure user-satisfaction, therefore, costs derived from
average values of time are not appropriate. For private operators, the duration of
maintenance works may have other important impacts.
Operating concessions for roads often include some charges to the road operator for
non-availability of the road to users. For example, a minimum number of hours for the
whole road to be open to traffic in a year may be required to avoid a penalty charge by
the overseeing highway authority. The criteria are likely to be more complicated than
this with the availability specified for different parts of the day and different levels of
charge made for closures at different times (e.g. the charge for night closures would be
less than the charge for closure during the peak hours).
(ii) user specified timing of the treatments during the analysis period,
(iv) deterioration modelled according to various factors such as material type, traffic
carried, climate and age, using predetermined relationships,
(v) deterioration predicted based on the past performance of each road length.
Fixed timings for each pavement type are usually adopted for new pavements to allow
predefined comparisons to be undertaken on specific road lengths. Local works costs
and user costs, appropriate to the levels of traffic, can be used to determine, from the
approved pavement types, that pavement type giving the best value for money. As the
prime use of whole life costing is with new roads, this is the most common method
currently in use for determining the timings of maintenance treatments in whole life cost
models.
The advantage of user specified timings is that local knowledge can easily be
incorporated into the predictions of maintenance. However, the disadvantage is that it
is more difficult to extrapolate the experience of the user to conditions not yet observed
and assess the implications for the future maintenance of the pavement. This can be a
problem where new designs, materials or conditions are experienced.
Rather than predetermined, or user specified, timings of treatments some systems use
treatment lives to indicate the need for further maintenance. This introduces the facility
to examine interactions between treatments that are adjacent in time and/or location, to
create a practical maintenance intervention.
In practice, the deterioration of road pavements is very variable and the condition of the
same type of pavement may deteriorate differently under changing circumstances. It is
possible to derive deterioration relationships based on the historic performance of a
length of road pavement and create a condition projection curve, which is directly suited
to each length. This approach has been used for whole life cost models and pavement
management systems in many parts of the world, for predicting the future condition of
each length of pavement in a network.
The process works by specifying a general curve for each pavement type and any other
parameter considered important for predicting the way that pavements deteriorate. An
example of these may be urban and rural environments. Actual condition
measurements are then considered with the general curve and the curve is moved by
shifting and stretching it along the x-axis and, if necessary, rotating it around the y-axis
until the minimum least-squares fit is achieved for the existing condition measurements.
If the existing measurements have been taken over a long period of time it may be
worthwhile age-weighting the fit of the measurements to the curve with the most recent
measurements having more importance. The best-fit curve then becomes the condition
projection curve for that analysis until more condition data enable the curve to be further
refined. Figure 5 shows an example of how existing data may enable the original
general linear relationship to be refined with three existing (one current and two historic)
measurement values.
Original
Condition
relationship
Shifted Stretched
relationship
relationship
Projected condition
Current condition
Historic condition
Time
Figure 5. Example of a condition projection curve fitting technique
An examination of the whole life costs of road pavements, which includes a prediction of
the maintenance requirements based on the traffic carried by the pavement, requires
the condition of the pavement to be expressed in terms that can be related to the traffic
carried. Some aspects of pavement condition not vary with traffic carried and the
maintenance required to restore those parts of the pavement condition must be
represented on a regular time basis (e.g. joint seals on concrete pavements). Some
whole life cost models may therefore include deterioration relationships that are
dependent on both time and traffic.
Structural Condition
This is usually expressed by pavement deflection although visual condition
assessments may be used to support the interpretation of deflection measurements.
Maintenance of structural condition is by a variety of strengthening treatments (e.g.
bituminous overlay), depending on pavement type, or by reconstruction.
Surface Condition
This aspect of condition has no impact on the strength of the pavement and can be
maintained by relatively low cost, treatments to the pavement surface (e.g. thin
surfacing or resurfacing). Surface skid resistance and rutting form two of the measures
of surface condition. Skid resistance can be used in the calculation of accident costs as
well as for identifying the need for future maintenance treatments. In severe cases,
excessive rutting can also contribute to an increase in the number of accidents
For unpaved roads, rutting is a major defect but may be easily corrected by re-grading.
Evenness
Evenness, sometimes referred to as roughness or ride, is not always directly related to
the determination of maintenance work but can be derived from a range of
measurements of condition or measured directly and used to calculate vehicle operating
costs. Various methods are available for measuring the evenness of the pavement
surface in many countries but it is the International Roughness Index (IRI) which is
generally used in relationships to estimate vehicle operating costs. IRI plays a major
role in the determination of costs in HDM4 (16) and many other whole life costing
systems. Indeed, for unpaved roads, roughness is often the only defect considered
because it has such a large effect on vehicle operating costs.
It is important in whole life cost models to consider the interaction between measures of
condition and the maintenance treatments. Pavement condition may identify the need
for maintenance but not all aspects of condition may be restored by the maintenance
treatment applied. Figure 6 shows the effect of maintenance treatments on three
measures of condition on a flexible pavement.
In the example in Figure 6, there is a need for the first maintenance treatment
(10 years) to restore skidding resistance but the surface dressing has no effect on the
pavement rutting or pavement strength. If the skid resistance had been restored with a
resurfacing, then both the rutting and skid resistance would also be restored. In this
example, this occurred when the depth of rutting required resurfacing treatment in years
15 and 33. Note that the full life had not been achieved from the surface dressing
carried out in year 10 but replaced in year 15. In year 33, the increase in the rate of
rutting, as traffic increased meant the skid resistance and the rut depth required
treatment at the same time. When the pavement was in need of strengthening, the
overlay restored all three measures of condition (deflection, rutting, and skid
resistance), even though the surface condition was not yet in need of maintenance. For
the maintenance treatments, typical works costs and user costs are shown for the
40 years analysis period.
Whole life costing helps the understanding and management of the interaction between
condition of the pavement and the maintenance treatments applied. These are the
decisions that road network managers face regularly and whole life costing helps
formalise and expand the scope of their decision making process.
Where deterioration models are based on past performance it is difficult to include new
materials and new pavement wear effects (e.g. super-single tyres) until extensive
studies have been carried out. This can reduce the effectiveness of whole life costing
systems in predicting the future costs associated with the road pavement.
0 5 10 15 20 25 30 35 40
(b) Rutting
0 5 10 15 20 25 30 35 40
0 5 10 15 20 25 30 35 40
R R
S
0 5 10 15 20 25 30 35 40
Time (years)
Maintenance works costs User costs
S: Surface dressing R: Resurfacing O: Overlay
Figure 6. Interaction between condition and maintenance for an asphalt pavement (1)
Reconstruction
(*) - After bituminous overlay, asphalt pavement maintenance treatments may be used.
Routine maintenance (e.g. local patching, crack sealing and road markings) is required
on all pavement types. Also, other maintenance (e.g. drainage) may have an effect on
pavement performance but is not directly a pavement treatment. This maintenance is
therefore not often included in pavement whole life costs but should be seen as an
essential activity if pavements are to achieve their optimum performance.
The essential economic differences between the pavement types are in the costs of
construction and maintenance treatments. Concrete is traditionally, initially more
expensive but may offer lower maintenance costs during the pavement life as the
structural design life is longer. Recent developments in asphalt pavement design have
enabled the longer structural design lives (40 years) often adopted for concrete
pavements, to also be used on asphalt pavements. Shorter (20 years) life pavements
are still predominantly asphalt. All pavement types still require maintenance to the
pavement surface during the structural design life.
There have been many studies into the comparison between asphalt and concrete
pavements with aims to look at many factors (e.g. costs, achieved life, energy
consumed). For example, Schmuck and Ressel (25) examined the achieved lives of
asphalt and concrete pavements on roads in Germany. From all of the studies,
however, it is clear that whole life cost analyses can help assess the value of
differences when alternative pavement types can be used to provide the required
pavement life.
The maintenance of concrete pavements has, in the past, also taken longer, due to the
concrete curing time of sometimes 15 days. When road user delay costs are
considered, this longer duration may have a significant effect on the delay costs at the
time of maintenance and therefore the selection of pavement type. Recent
developments have, however, enabled the curing times to be reduced substantially and
there is consequently much less disruption to road users at the time of maintenance
work.
For the effect of wear, the heavy goods vehicle is the principal component of traffic and
must be extracted from the total flow value. In sophisticated models, these vehicles may
be split further into rigid and articulated vehicles and by number of axles per vehicle.
Recent developments in vehicle suspensions and tyre arrangements can have a
significant effect on the wear on the pavement. To isolate all of the different vehicle
types in the total flow may be possible in the future but few models yet contain more
than 4 heavy vehicle categories.
Although some pavement wear (e.g. reduction in skid resistance) is related to the flow
of heavy vehicles, the flow is generally converted to the number of equivalent standard
axles per vehicle and these are aggregated over the days and years in the analysis
period. On multi-lane carriageways, the total heavy vehicle flow is distributed across
more than one lane and, to avoid overestimating the wear, this distribution must be
reflected in the analysis. The whole life costs are usually calculated for the carriageway
based on the performance of the most heavily trafficked (by heavy vehicles) lane. For
the use of whole life costing in pavement management systems, the costs of
maintenance in each lane may be examined.
For the calculation of the costs of user delays it is necessary to consider the time of the
year and the time of day for the maintenance work. There is a significant variation in
traffic flow with season of the year with higher flows during the periods of better
weather. Maintenance is often carried out during these periods of heavy flow to
maximise the likelihood of optimum conditions for the work.
Each whole life cost system is different and may range in complexity from a simple
analysis package, based on computer spreadsheets, to sophisticated systems with
software written specifically for the system. Similarly the model may represent a single
length of road or a complete road network. The calculations needed within any whole
life cost system are such that manual systems are likely to be of limited use within a
road management department. However, the overall approach for all of these types of
systems is the same. Figure 7 shows a simple view of how the approach may be
applied.
The aim of all systems is to represent the future life of the road and predict the costs for
the analysis period. For a new road this period starts with construction of the pavement
but for existing pavements the period may start at any time. After initial construction, at
various times during the life of the pavement, maintenance is carried out. The cost of
construction and each maintenance operation has associated costs to the road user
and society. Other costs (e.g. routine maintenance and vehicle operating costs) are
incurred in each year whether or not there is a specific maintenance intervention.
Determine traffic
and condition for
the year
Yes
Accumulate Maintenance
cost for the needed ?
year
Maintenance strategy
No
No Last year of
Next year in
analysis period analysis
period?
Yes
Residual value
Outputs
To allow fair comparisons to be made, all costs over the analysis period are discounted
back to a common point in time, usually, but not necessarily, the start of the analysis
period. The choice of annual discount rate used for the future costs is generally set by
the funding organisation to apply for all transport assessments. Alternatively, special
rates may be applied for individual projects when particular financing arrangements
have been made. This is more common for the privately financed road concessions that
have been introduced more widely in recent years. In all cases, the discount rate may
change and there is a role for whole life cost models to examine the sensitivity of the
whole life costs of the different options, to changes in discount rate.
PIARC . 55 . 08.09.B - 2000
Where unit costs used to calculate the total cost of each maintenance intervention
within the analysis period are all at a common price base (i.e. exclude inflation), it is
appropriate that the discount rate used to reduce future costs to a common price base,
should also not include any element for inflation. If unit costs include inflation, the
discount rate must also include an element for inflation. It is however, more
straightforward to omit inflation from both considerations as discount rates are normally
quoted excluding inflation. It also avoids the difficulty of inflation rates varying with time,
and different rates applying to different costs, while only an average inflation allowance
could be included in a discount rate specified as including inflation. In the developed
economies of European countries and North America, the use of discount rates
between 4 and 8 per cent is typical. Higher rates may be used for private road
operators where funding is direct from private banks. The sum of discounted costs over
a specified period is known as the Net Present Cost. Similarly, if benefits are available
and discounted over the same period, the difference between the discounted benefits
and discounted costs is known as the Net Present Value.
The whole life cost is represented by the total of the costs that occur during the analysis
period (i.e. the Net Present Cost of the works costs and costs to the road user and
society). The lowest whole life cost is the lowest Net Present Cost. When benefits, or
savings, are part of the analysis, other methods are available to use with the discounted
costs to select the best option. For example, rather than use a fixed discount rate, the
rate which makes the Net Present Value equal to zero, known as the Internal Rate of
Return, may be used and the higher this rate, the better. The Internal Rate of Return
needs to be greater than the discount rate for the investment to be worthwhile. This
approach is used in many whole life cost systems throughout the world as it avoids
difficulties caused by comparing whole life costs derived using different discount rates.
Another method for assessing the whole life cost is to use the Annualised Equivalent
Cost (also referred to as the Equivalent Uniform Annual Costs). This represents an
annual value of the Net Present Cost or Net Present Value and is sometimes used
when comparisons are made over different analysis periods (e.g. the analysis period
may be different for each option and could be equal to the pavement design life) and the
salvage value, at the end of the analysis period, has not been calculated. This
technique is also more applicable when a regular annual payment is made for an asset
(e.g. a building) rather than the procurement of roads.
Simple investment analyses may be based on the Pay Back Period in which the time
needed for achieved savings to exceed the initial cost is determined. This may be with
or without consideration of discounting future costs. This period does provide a measure
of risk, in that, the longer the period, the higher the risk of recovering the initial cost.
There is no measure of return from this method and it is not often used in whole life cost
analysis.
The longer the analysis period, the greater the uncertainty in the prediction of the future
performance and use of the pavement. In all long-term predictions, the sensitivity of the
forecast to changes towards the end of the analysis period should be examined. This is
true in the calculation of whole life costs and has led to the use of probabilistic
approaches to the analysis rather than the traditional deterministic methods. An
alternative approach, adopted in some countries, is to limit the analysis period to
20 years.
At any time during the life of the pavement, the structure has a value, known as the
salvage or residual value. At the minimum, this value represents the potential use of the
material in the road for re-cycling into new material to be used in new construction or
maintenance works. In practice, unless the material is in very poor condition, the
pavement has a higher value than this because there is a capability to continue to
support the traffic carried by the pavement. In any year, the decrease in salvage value
relates to the traffic carried by the pavement and the age of the pavement. In practice,
in whole life cost models, the variation is usually represented by time rather than by
traffic. Similarly, the variation is often considered as linear although a curve, with little
change in the early years and a faster decrease towards the end of the life, may be a
more realistic representation.
Reconstruction
Salvage Overlay
Value
Fixed cost
10 20 40 30 50
Time (years)
(a) Based on structural condition only
Salvage
Value
Fixed cost
10 20 30 40 50
Time (years)
(b) Based on structural and surface condition
In the USA, the Federal Highway Administration (10) has developed a methodology for
the Life-Cycle Cost Analysis in Pavement Design. This contains a detailed description of
the approach to adopt for investigating pavement design alternatives on a whole life
cost basis including works costs, the time delay costs incurred by road users and the
costs of road accidents. Details are also provided on the uses of deterministic and
probabilistic analyses.
The Swedish model is also designed for project level analyses, to run on a Personal
Computer and can be used to examine different pavement types and alternative
pavement surface layers. More details of this model are provided by Huvstig (15).
The World Bank Highway Design and Maintenance Standards Model, HDMIII (20) and
the TRL Road Transport Investment Model, RTIM (19) were two of the earliest models
developed for the analysis of road projects in countries with less developed economies.
Under funding provided by the UK Department For International Development, the
Asian Development Bank and the Swedish National Road Administration, with further
support from the World Bank, HDMIII has been upgraded to HDM4. As part of this
upgrade, the scope of the HDM III model has been increased to include concrete roads,
frost susceptible formations and traffic congestion effects. The HDMIII models for
bituminous and unpaved roads are, of course, still available. The model contains a high
level of detailed relationships for vehicle operating costs which, with pavement
maintenance activities, can be used to examine the effects of no maintenance work.
Data Input
For the calculation of whole life costs of any road pavement, there is a significant
amount of information to be input, as shown in Figure 9 (e.g. traffic, intervention levels,
unit works costs, rates of working, value of time, value of accidents, maintenance works
times, traffic management). It is therefore essential that a simple, well structured data
input facility is available. With many parameters, to avoid long repetitive data entry
procedures, many systems operate on the basis of over-writing default values.
Examples of the inputs in each area are:
Economic parameters: Discount rate, analysis period, values of time and accidents
Road Type
Pavement Traffic
Condition Forecast
Inputs
Works Maintenance
Data Policy
Economic
Parameters
Condition prediction
A module for the prediction of condition of the pavement is required for each aspect of
deterioration or defect. These may be by a generalised model for the road and pavement
type or a model specially calibrated for each individual length of road using historic
condition measurements. In simpler systems, condition may be represented only by the
age of the current maintenance treatments or the user may specify the timings of the
maintenance interventions. This is one area currently receiving a great deal of attention
with the further development of deterioration relationships that can be used in whole life
cost models. For example, new relationships have been developed as part of the PARIS
project carried out under the 4th Framework established by the European Commission (9).
Maintenance identification:
Rules are required to transform the predicted condition of the pavement into the type of
maintenance needed. Where more than one aspect of condition is in need of treatment,
these rules must reflect the likely selection which would be made by an experienced
pavement engineer.
Works costs
For each maintenance treatment, it is necessary to calculate the cost of the works. This
may be with the use of simple unit rates for each treatment or the system may consider
the different parts of the treatment (e.g. preparatory work, consequential work, traffic
management) separately from the main treatment. Similarly it may be necessary to
consider different costs if the work is carried out during the night rather than in the day
time. For major works it may also be appropriate to include the additional costs of design
and contract administration services. Routine maintenance is carried out on an annual
basis and separate costs may be calculated to represent this work.
User costs
This module may be separated into sub-modules for the calculation of the costs of delays
to traffic at road works, the costs of accidents and vehicle operating costs. These total
costs are likely to be aggregated from costs calculated for each vehicle type. For the
calculation of the costs of disruption to traffic, the effect of different standards of alternative
routes around the works site need to be considered. In addition to traffic accidents, some
models may also represent the cost of accidents to the maintenance workers on the road.
Outputs
Comparisons of the whole life costs of construction and maintenance options may be by a
variety of indicators (e.g. Net Present Cost or Internal Rate of Return) but these are not
normally sufficient for the user to fully understand the results of the analysis. Outputs
shown in Figure 10 for all of the predictions associated with an analysis will assist the user
to understand, and therefore have confidence in, the results of the analysis. The user will
be able to see the predictions from the model and assess if they are representative of this
road and traffic combination. Graphical presentations may be used to ease the
assimilation of the many results from the analyses.
Construction
Costs
Residual
Traffic
Value
User Pavement
Outputs
Costs Condition
Works Maintenance
Costs Treatments
Works
Durations
Construction cost for a new road, the model will estimate the construction
cost of the pavement
Traffic from the initial traffic flow and growth rates, the expected
future traffic flows and loading will be available
Pavement condition predicted pavement condition through
the analysis period
Maintenance treatments a list of the maintenance treatments expected to becarried
out during the life of the road
All, or some, of these general modules are found in most systems but there are
differences in the types of analysis which may be undertaken.
Project level analyses of specific lengths of road may be used to plan the maintenance
strategy for the road over a given period or to compare two construction/maintenance
alternatives for the road. Network level analyses, however, generally address the
implications in terms of whole life cost, of different budget allocations for a whole network.
As computing power continues to increase rapidly, the ability to undertake project level
analyses for whole road networks becomes more easily achievable and the differences
between the two levels less certain.
For example, in the UK, the model for the whole life costs of maintenance options on
specific road lengths, uses detailed condition data from actual condition surveys to identify
the maintenance treatments, while models for road networks use aggregated data in the
analysis of budget need.
Traditionally, whole life costing systems have been developed based on deterministic
models of pavement deterioration, traffic growth, effects of maintenance and costs of the
work. It is becoming increasingly important to extend the capabilities beyond the normal
sensitivity analyses undertaken with these models into a wider investigation of the
probabilities of the various possible outcomes. By specifying the distribution parameters
(e.g. mean value and variance) for each input, the shape of the output probability
distributions can be investigated.
1000000
500000
0
0 10 20 30 40
-500000
Time (years)
F ure
i 11.
g Determin stic
i mainte ance
n rofile
p
Lane 3
Lane 2
Lane 1
Reconstruction Overlay
Resurfacing No treatment
It is now commonly accepted that the management of a road network is best carried out
using a pavement management system. However, there are still many of these systems
which are based on pavement condition rather than the economics of maintenance work,
including whole life costs. The overall management process is generally recognised to be
that described by Robinson, Davidson and Snaith (24) and comprises four stages:
Preparation the final stage before implementation and design options are
considered in detail
Project level analyses generally apply to the third stage while network level whole life cost
analyses are aimed at the first two stages. In practice, as analysis techniques and
processing facilities continue to improve, it becomes more difficult to distinguish between
them and the same approaches may be used for both types of analysis.
With the increase in computing capabilities in recent years, this type of analysis has now
been extended to carry out an analysis equivalent to a project level analysis on each road
in the network and plan the appropriate maintenance strategy for the network. By retaining
the information describing the location of the pavement and the condition information, this
also allows the interaction between adjacent links in the network to be considered as part
of the analysis. For example, it may not be feasible to carry out major maintenance works
on two adjacent roads in the network but it needs whole life costing to examine the
implications of deferring one of the projects. By examining the maintenance predicted for
the future on both roads, with and without the maintenance proposed for the current year,
then the option with the lowest cost consequences can be selected.
Another feature of maintenance work is that some traffic diverts from one road to another,
rather than passes through the maintenance site. When considering the whole network,
the effect of this extra traffic on other road pavements can be included in the network
analysis.
By considering all of a network, the uses of whole life costing are extended to allow a more
comprehensive analysis of budget requirements and, more usefully, to look at the change
in whole life cost resulting from different target levels of condition in the future. The
interaction of the different maintenance works on the network has caused some of the
mathematical programming techniques (e.g. linear and dynamic programming) to be
adopted in the assessment of optimum pavement condition at budget level for the analysis
period.
The analysis period for network level analysis may be only 5-10 years rather than
30-40 years at the project level. Individual projects within the network may still use
the long analysis period but the shorter period is used for the whole network.
As analyses become more complex, one way to reduce the complexity is to use
aggregated condition data, rather than the same detailed measurements that are
made for individual road projects.
The role of probabilistic analyses becomes more applicable at the network level.
This is considered further in Section 2.6.
When considering the whole network it becomes more important to consider other
assets on the network (e.g. bridges) in the whole life cost analysis. This enables the
benefits of integrating the maintenance work, within a single road occupancy, to be
assessed.
Figure 13 shows the associated engineering management systems but linked to all of
these are systems for the administrative management. These include:
Financial accounting
Payroll
Contract management
Budgeting
All of these systems hold information and carry out processing which is well suited to
whole life costing. In future, these links will become stronger and, in time, an integrated
management system will be developed which can do a full whole life cost analysis of all
features on the network.
Pavement
Streetworks
Management
Transport Environment
Planning CENTRE and Parks
Routine
Traffic
Maintenance
Equipment Materials
1000000
500000
0
0 10 20 30 40
-500000
Time (years)
Figure 14. Deterministic maintenance profile
If the discount rate = 4%,
then, the Net Present Value (NPV) is the sum of the Initial Construction Cost
(1,000,000) and the undiscounted maintenance costs (500,000) which occur in years
10, 20 and 30, less the undiscounted salvage value (50,000) at the end of the analysis
period.
= 1,709,720
PIARC . 79 . 08.09.B - 2000
The deterministic approach is a viable method for determining life cycle costs.
However, the main difficulty with this approach is the inability to account for the
variability of the inputs. For example, changes in future maintenance or rehabilitation
costs and changes in expected performance are not automatically accounted for using
the deterministic approach. To examine the effects of uncertainty using a deterministic
approach, the analysis may be extended to examine the sensitivity of the results to
changes in the input parameters. When there are many parameters for which the effect
of uncertainty is to be examined, this can involve a great deal of analysis.
The probabilistic approach, however, automatically takes into account the uncertainty of
the variables used as inputs and in processing in the life cycle cost analysis. The
probabilistic approach may be used at both the project and the network levels. At the
project level, the analysis shows the likelihood of the different whole life costs resulting
from uncertainties in the model parameters (e.g. network levels), these uncertainties
apply to all of the road lengths and, until recently, it has been necessary to carry out the
analysis differently.
The early network models used simple distributions of one, or a few, measures of
condition and examined the effect of different budget levels. Figure 15 shows two
examples of a simple network analysis that uses a condition index to represent the
pavement condition. In Figure 15, the index may take a value between 0 and 80 where
low values represent poor condition. In (a) and (b) the start (year 0) distribution of
condition (as given by the histogram of index values) is the same but in (a) a low budget
is applied each following year and in (b) a higher budget has been adopted. In (a), the
budget is sufficient to achieve a levelling off of condition and provides a better future
expenditure profile. In (b) with the higher budget, the proportion of the network with low
condition index values is removed and replaced with higher values following the
maintenance work. In this example, the maintenance is not sufficient to provide the
highest condition index values.
This type of analysis was generally carried out for only one or a few defects. A slightly
different approach was adopted and is still in use for the analysis of all the defects on
the network. This used Transition Probability Matrices to show the likelihood of one level
of condition moving to another level. The probabilities may be specified for categories of
similar pavements in the network (e.g. levels of traffic, types of roadbase). These
require careful work to create the appropriate probability values in each cell of the
matrix. Table 2 shows an example of one of these matrices. In this example, a rut depth
of 6mm (in 5-8mm band) in the current year has a 30% probability of being between 8
and 14mm the following year. In some systems probabilities are given for combined
defects (e.g. rutting and cracking).
% %
Year 0
0 0
10 10
% %
Year 6
0
0
10 10
%
% Year 10
0 0
0 20 40 60 80 0 20 40 60 80
Pavement condition index Pavement condition index
(a) Low budget (b) High budget
Figure 15. Histograms of pavement condition for different budget levels
Table 2. Example of a transition matrix for rut depth on a European road network
Alternative B
Probability
Alternative A
In Figure 16, the mean values for Alternatives A and B are approximately the same.
However, the uncertainty is much higher for Alternative A. In the example, the
uncertainty is nearly balanced in that the chance of achieving a high cost is similar to
the probability of achieving a low cost. This is not always the case as the input and
output distributions are rarely as symmetrical as those shown. The likelihood of the cost
of one Alternative being higher than the cost of another Alternative can be examined
and the risks calculated. Porter (23), Abell et al (2) and Perone et al (21) show how
probabilistic analyses can be used in whole life costing and the FHWA Guidelines (10)
contain specific details on the use of a probabilistic approach.
The main objective of the questionnaire was to obtain information on the use of whole
life costing in the management of road networks. This includes, for example, for
establishing standards and evaluating alternative options for construction and
maintenance.
For this study, 61 questionnaires were distributed to all CT8 participants. This meant, in
some cases, the questionnaire was sent to more than one organisation within a country.
This enabled different perspectives to be given for the same country (e.g. by a
university and by industry).
Many countries make some use of whole life costing, primarily for comparing asphalt
and concrete construction alternatives for pavements.
Whole life costing is used mainly for pavements and bridges and not other road
features such as drainage, foundations etc. In the case of bridges, whole life costing
is used mainly for comparing maintenance options on specific types of bridge.
14 replies stated that current research in the area of whole life costing includes the
development of design standards, use in pavement management systems, long-term
pavement performance and road user costs.
Most countries have a standard for pavement design lives and these usually aim to
provide 20 years life for asphalt pavements and 40 years for concrete pavements.
With the development of new materials and design approaches, longer lives are now
available.
None of the countries has a policy to take whole life costing into account when
evaluating new pavement construction or maintenance options. When whole life
costing is used it is primarily for high cost projects (e.g. Canada uses whole life costing
when project costs exceed 1 million CND). In general whole life costing is considered
for selection of pavement type for new construction and for the option at the time of
major maintenance (e.g. rehabilitation) schemes. In most countries when whole life
costing is applied it is mainly for motorways, sometimes for primary roads, but very
rarely for local roads.
Lack of accurate data is a major reason why whole life costing is not used more widely.
Use of whole life costing may vary within a country. In Australia and USA, the practice
in relation to the use of whole life costing varies between the States.
When whole life costing is not used, new road pavements and maintenance options for
existing roads are generally selected on the basis of lowest initial cost alone or,
occasionally, with some allowance for future maintenance requirements. Evaluation
periods for assessing new construction alternatives are generally longer than those for
assessing maintenance options.
Very few countries include an allowance for user costs in whole life cost estimates,
however, inclusion of these costs in the future is under consideration. Some countries
include environmental factors (mainly noise and use of recycled materials) in the
current evaluations.
Road user costs are seen mainly to comprise costs of delays to road users due to
roadworks and journey time and vehicle operating costs related to pavement condition.
Accident costs are considered less often.
At the project level, future maintenance requirements are determined on the basis of
engineering judgement or by using deterministic models of pavement performance.
Few countries use a probabilistic approach for network level pavement analysis.
The pavement residual life concept is used in a majority of countries and in most of
them it is evaluated both at the network and project levels using structural and surface
condition data. It is used either as part of a general condition index (8 countries) or to
represent structural condition (8 countries). It is also used in the evaluation of asset
value at the end of the evaluation period.
Discounting is the tool most commonly used to handle future costs and, when used, it
is applied throughout the assessment period. For the countries replying, the annual
discount rate varied between 3% and 12%.
Pavement Management Systems are used in several countries for the prioritisation of
maintenance budgets. Many of these systems include whole life cost analyses in
setting priorities.
Other whole life costing applications given in the replies include the comparison of
contractor construction alternatives, comparison of budget options, assessment of
innovative products and establishment of new standards.
The whole life costs of road pavements can be used to obtain the best value for money
from highway expenditure. It is important that these costs closely represent the costs
that would arise from the deterioration patterns of in-service pavements and the
analysis allows the application of maintenance strategies appropriate to different
situations.
Whole life costs may indicate that the lowest initial cost is not necessarily the best value
for money. Similarly, conditions vary across the road network and an optimum design
for one pavement may not be so in other situations. For example, on easily maintained
(lightly trafficked) roads there may be few benefits in paying more for improved
durability, but on more heavily trafficked roads the position may be different and
increasing the strength of the pavement, at the same time as providing a new surface,
may be worthwhile.
There are numerous possibilities for the application of whole life costs at both the
project and network levels.
In the future, standards and specifications may be influenced by external factors (e.g.
pavement noise and sustainability) and whole life cost analyses will have a major role to
play alongside the analysis of these other criteria.
2000
0
20 25 30 35 40
Life to overlay (years)
For example, a new wearing course material may have properties which provide a
better resistance to rutting than achieved with conventional material but the properties
do not change any other aspect of performance. It is estimated that the rate of rutting is
10% less with the new material but the material cost is 25% higher. There is no effect
on the rate of laying the material for the traffic management required during the
maintenance work or the resources required to lay the new material. Also, lower
pavement layers remain unchanged. The increase in the costs of the maintenance
treatments is therefore less than the 25% for the new material but still increases the
total costs of the treatments. Table 4 shows the discounted costs (annual rate of 6 per
cent) from a whole life cost analysis to assess if the extra cost of the new material is
worthwhile.
The principal source of the saving is the removal of the thin surfacing treatment before
the overlay. With the conventional material, the pavement is not expected to last
11 years between the resurfacing and the overlay. Overall the use of the new material
provides a reduction of 15% in works costs and for the whole life cost of the pavement,
approximately 10%, and appears therefore to be worth the extra initial cost.
0 Construction - - -
29 RS 38 443 481
0 Construction - - -
12 RS 109 186 296
21 OV 94 512 606
31 RS 36 439 475
An indicator defined on the basis of the ratio of the change in future costs to the increase
in current costs can therefore be used to select the maintenance options which will help
allocate the most effective maintenance budget.
The higher the value of the indicator, the higher the importance of the initially higher cost
option and hence the higher the priority for allocating part of the budget to that option. If
the ratio is negative, the higher cost option is not viable.
It has been shown how the economic approach costs less in terms of maintenance
expenditure but leaves the network in a better condition than the traditional condition
based method for the selection of sections for treatment and the treatment types to adopt.
It is essential when adopting this approach to the evaluation of tenders, or bids, for
work, that the process is transparent to the contractors tendering so that the options
available can be assessed by the contractors prior to, or during, the tender period.
Table 5 shows the future costs for the six pavement options available on two schemes
during the trials. These schemes represent a heavily (scheme A) and lightly (scheme B)
trafficked road on the national network. Additional future costs would be required if other
fully flexible pavement types (e.g. the new stronger roadbases) were to be considered.
Scheme A Scheme B
FF 1,790,000 400,000
FC 1,470,000 410,000
The use of whole life costs also extends into determining overall payment plans for non-
compliant work because again, payment for the work can be based on the predicted
performance of the pavement.
To estimate the effect of deficient work on performance, it must be possible to apply the
deterioration models to levels of quality which may not have been included in the data
used to produce the models, and appropriate intervention levels must be devised for
use in this situation. However, once the intervention level has been broken,
maintenance work is necessary and this can be assumed to remedy defectiveness. The
costs for future years are then estimated in the normal way. The difference between the
expected whole life cost and the whole life cost resulting from the as-built pavement,
could be related to the pay adjustment factor for the work.
User costs are an important, and may be a large component of the whole life cost. An
effect of the provision of a poor quality pavement may be to significantly increase this
component of cost and it is, therefore, important that this part of the total cost also forms
part of the payment plan. A high quality pavement may reduce future user costs and,
similarly, the contractor could receive the benefit from this.
The use of whole life costing for the allocation of budgets has already been described
but, as part of effective management of the network, there is a need to determine the
budget required to achieve a target condition of the network and to determine what that
target condition should be. The only way these can be reliably determined is by
examining the whole life costs of alternative strategies and optimising the budget over a
specified period.
Many of the advantages and disadvantages of the approach are not particular to the
highway engineering field. The issues are currently being assessed to determine their
relative merits. In this section, the merits of these will be discussed. It is also worthwhile
to consider each of the issues as they can act as a major justification for the application
of the technique.
Whole life costing can be carried out without adequate appreciation of the difficulties
that may be encountered. The issues identified in this section can serve as a useful
check and balance to the implementation and operation of the approach.
Stimulates innovation
If improved performance, even at higher cost, can be selected, engineers are
encouraged to develop techniques to provide that improved performance. To stimulate
this activity, engineers must be able to see a way in which the innovative solutions can
be assessed and benefits identified. Whole life costing provides that assessment.
Policy changes
Without technical changes, there are still potential policy changes. Examples may be
the level of vehicle/fuel taxation that causes a change in the modal split in journeys, or
the restricted use of parts of the highway. All of these types of changes can be
examined using a whole life cost model and decisions taken, based on a more
comprehensive analysis of the possible outcomes.
Performance specifications
The use of performance specifications is only now being introduced into road pavement
construction and maintenance work. This approach will increase and whole life costing
has a full role to play in allocating the appropriate costs for the levels of performance
provided.
Accidents
The costs of accidents have been included in the costs associated with road works for
some years. As traffic management arrangements change, the effects on these costs
need to be considered to ensure that the correct allocation of costs is retained.
Accidents also arise because of low levels of condition on the road pavement and little
is known about this effect except where the defect is skid resistance. As Governments
continue to press for further reductions in the number of accidents, this area is
important. Significant savings can be made by reducing the costs of accidents on an
individual road and those costs need to be more fully represented in whole life cost
models.
Performance indicators
In many countries there is a move to the introduction of performance indicators in many
aspects of road management. These indicators may include a measure of whole life
cost and the success of the highway authority in managing the whole life cost as well as
the engineering aspects of the road.
Many different definitions are available for whole life or life cycle costing but that given
for road projects in the Quality Improvement of the National Highway System NHS
Designation Act of 1995 in the USA, encompasses the views of the sub-committee:
... a process for evaluating the total economic worth of a usable project by analysing
initial costs and discounted future costs, such as maintenance, user, reconstruction,
rehabilitation, restoring and resurfacing costs over the life of the project.
Whole life costing has been available for use separately in the analysis of the costs
associated with various parts of the infrastructure (e.g. pavements and bridges) for
some years. The application of the approach to road pavements has already been
demonstrated throughout the world in many different situations and whole life costing is
already a fundamental tool for highway managers. Although not yet applied in a routine
way, a major advantage of the technique in the future is expected to be the combination
of analyses for all parts of the infrastructure, to provide a full picture of the cost of a road
over its life.
Whole life cost analyses can be undertaken for a wide range of road lengths and road
types, at various levels of detail. Nevertheless, there is a consistent approach which can
be adopted for all of the different types of analyses for lightly and heavily trafficked
pavements at the project and network levels.
It is possible to apply the same approach to all situations with the components of cost
contributing different proportions to the total cost. For example, user costs associated
with pavement condition and road maintenance on heavily trafficked roads are primarily
the costs of delays to users at road works. In parts of the world where traffic flows may
be lower and pavement condition includes higher levels of unevenness, the balance
changes and the vehicle operating costs arising from fuel consumption, tyre wear,
vehicle repair etc, become the dominant factor.
Whole life costing has been shown to be suitable at all of the stages in the life of a road;
inception, design, construction and maintenance. The level of detail in the analysis
changes for each of the stages and at no stage is the whole life cost the only, or indeed
necessarily, the major factor in the engineering decisions.
The introduction in the future of new materials (e.g. stronger pavement types
incorporating High Modulus Base material) and techniques may always affect the future
cost of the road pavement. This occurs whether decisions are taken on the basis of
initial cost or whole life cost. Whole life cost analysis is a valuable tool for evaluating
innovative concepts and new materials, giving a more complete assessment of the
benefits offered and the value for money.
More than 40 replies to a questionnaire on the use of whole life costing show that whole
life costing for road pavements is possible and is taking place for a variety of uses in
many countries. The most common application of the technique is currently the
comparison between the costs of asphalt and concrete pavements. In many cases, the
analysis methods are relatively simple but, even at that level, it is seen to be better than
basing all decisions on the first cost and taking no account of the future costs during the
life of the road.
The ability to undertake this type of analysis can be markedly affected by factors such
as the quality of construction, uncertainty in future predictions of traffic and pavement
performance, in addition to changes caused by the introduction of new materials and
techniques.
This review has shown that whole life costing already plays an essential role for the
highway manager but there is scope for further development of the method to link all the
cost elements relevant to the operation of the road network.
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AZMY OE, SHARAF EA AND LOTFI HL (1989). A combined life cycle cost and
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BOWSKILL GJ (1993). Whole life costing: Where next? Possible applications. ACMA
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BULL I and WARWICK R (1992). An approach to the life cycle cost analysis of
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BULL JW (1993). Life cycle costing for construction. Blackie Academic and
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COLE LW and HALL MJ (1997). Relative costs of various concrete pavement features.
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HOYT DM, LYTTON RL AND ROBERTS FL (1988). Performance prediction and cost-
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KILBOURN PCR and ABELL R (1988). Whole life costs of concrete pavements.
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POWELL WD (1988). Road trials and design considerations for heavy duty roadbase
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ARRB Regional Symposium, Launceston, Tasmania. Australian Road Research Board,
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RILETT LR, HUTCHINSON BG and HAAS RCG (1989). Cost allocation implications of
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characteristics of AASHO designed rigid and flexible pavements in Louisiana. Federal
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UNITED KINGDOM
Mr. Richard ABELL,
Transport Research Laboratory
Sub-Committee Members
AUSTRIA
Mr. Johann LITZKA,
Technische Universitt Wien
AUSTRIALIA
Mr. Ian REEVES,
Dpartment of Main Roads, Queensland
CANADA-QUBEC
M. Nelson RIOUX,
Ministre des Transports du Qubec
FRANCE
M. Franois VERHEE,
Euravia Services
HONGRIE / HUNGARY
Mr. Laszlo GASPAR,
Institute for Transport Sciences Ltd
ITALIE / ITALY
Prof Aurelio MARCHIONNA,
Universita di Roma III
JAPON / JAPAN
Dr. Masaru MIZOBUCHI,
Research Institute, Tokyo
MAROC / MOROCCO
M. Ahmed MRHIZOU,
Directeur du CTR de FES
POLOGNE / POLAND
Mr. Dariusz SYBILSKI,
Roads and Bridges
Research Institute
PORTUGAL
M. Alberto GARRIDO,
TG7, Urb. Ralone
ROUMANIE / ROMANIA
Prof Stelian DOROBANTU,
University of Bucharest
ROUMANIE / ROMANIA
Mr. Florin DASCALU,
National Administration of Roads
SUDE / SWEDEN
Dr. Safwat SAID,
Road and Transport Research Institute
UNITED KINGDOM
Mr. Douglas COLWILL,
Transport Research Laboratory
GLOSSARY OF TERMS
Terms Associated With Whole Life Costing
Deterministic Analysis
Analysis which takes no account of variability and uncertainty in the input data and
analysis procedures.
Probabilistic Analysis
This approach combines probability descriptions of analysis inputs with computer
simulations to generate the entire range of outcomes as well as the likelihood of
occurrence.
Risk Analysis
See Probabilistic Analysis.
Sensitivity Analysis
An analysis which attempts to discern the effect on a forecast caused by variations in
the underpinning assumptions.
Ct
NPC = t
(1 + r / 100)
t=1
Life-Cycle Cost
See whole life cost.
User Costs
These costs incurred by road users. In whole life cost analyses for road pavements,
these are generally the extra costs incurred due to roadworks or the condition of the
pavement. User costs typically are an aggregation of three separate components:
Vehicle Operating Costs (VOC), Accident Costs, and User Delay Costs.
Design Life
The pavement life to be achieved before strengthening.
Serviceable Life
The life of an asset until its functional, physical, technological, economic, social and
legal life (whichever is sooner) dictates replacement.
Analysis Period
The period over which life cycle costs are calculated.
Evaluation Period
See Analysis Period.
Benefit-Cost Ratio
The ratio of discounted net benefits to initial costs.
Discount Rate
The rate at which costs and benefits occurring in the future are converted to present day
values. The discount rate may be in nominal terms where both the effects of inflation
and real earning power of money are reflected or in real terms where the effects of
inflation are excluded. Nominal discount rates are normally used in whole life cost
analyses.
(Bt - Ct)
0= t
(1 + r / 100)
t=1
(Bt - Ct)
NPV =
t
(1+r/100)
t=1
Salvage Value
See Residual Value.
Residual Value
The monetary value of an asset at the end of the analysis period.
Routine maintenance
Minor maintenance works carried out on a cyclic basis (e.g. drain and sign cleaning) or
in response to localised minor defects (e.g. patching).
Traffic Management
Measures used to guide traffic through roadworks sites to achieve a smooth low risk
flow of traffic.
Reconstruction
Removal of the existing pavement and rebuilding the road along the same alignment.
Partial reconstruction involves removal of the existing pavement above the sub-base.
Overlay
Maintenance which consists of spreading and compacting bituminous or concrete
material on an existing pavement in one or more layers, each up to 100mm thick.
Resurfacing
Process consisting of removing the existing pavement surface and replacing with new
material without increasing the total pavement thickness by more than 50mm.
Surface dressing
Spreading of bitumen binder and covering with aggregates, on the surface of a pavement.
QUESTIONNAIRE SURVEY
World Road Association (PIARC)
This Committee has set up a Task Group to study the Whole Life Performance of
highways and, in order to carry out this task, we would appreciate your help in
completing this questionnaire.
The aim is that this exercise will involve close collaboration with Technical Committee
TC7: Concrete Roads.
Please tick () the appropriate boxes of the questionnaire and add any comments that
you consider are relevant.
Where choices are provided for answers please tick the box reflecting the main position
of your country. Please explain under the comments sections provided where there are
regional variations or where there are differences between state and private road
operators.
Finally, it would be helpful if you could provide a short summary of your national position
concerning the whole life performance of road pavements and list any current research
on the topic. This will be used to compile a report for publication in Routes/Roads
Graham J Bowskill
Highways Agency
Room 3/37 St Christopher House
Southwark Street
London SE1 0TE
UK
2. Are you actively researching whole life costs for use in future standards?
8. Do whole life cost procedures include an allowance for the following future
maintenance needs?
9. If whole life cost procedures include an allowance for road user costs, please indicate
which costs are considered.
Comments:
10. To what extent are road user costs applied (as identified in Q 9)?
14. Do you update your performance models by checking actual maintenance carried out
against predictedneeds?
15. Is the residual life of the pavement included in the assessment of whole life costs as
a measure of structural condition?
17. What evaluation period do you use for calculating whole life costs in the following
situations?
18. Do you evaluate the asset (pavement) condition and/or its value at the end of the
evaluation period?
21. How do you measure the condition of a road pavement? Indicate which techniques
are used and whether they are used as part of a network condition assessment or at a
detailed level for individual projects.
Network Project
(a) Measurement technique
(i) Visual condition
- manual systems
- automated recording/manual interpretation
- automated recording/auto interpretation
(ii) Profile - longitudinal
(iii) Profile - transverse
(iv) Texture
(v) Skid resistance - high-speed (over 50 kph)
(vi) Skid resistance - low-speed
(vii) Benkelman beam
(viii) Deflectograph
(ix) Falling Weight Deflectometer
(x) Other (please specify)
(b) Analysis of condition data to determine residual
life. Does this include?
2.3 You have now completed the questionnaire. Please circle which of the following most
closely describes your role:
Yes No
Name -
. Company/Employer -
Address -
ANALYSIS OF
THE QUESTIONNAIRE RESPONSES
Part 1: Whole life performance
The main points from the responses to each question are briefly described below. For
each question, the number of replies, from the total of 29, providing each answer is
included.
Concrete 7 7 5 8
There is little direct information on how design standards have been established but
most countries appear to have standards for design lives of new pavements. In most
cases the design life is 20 years for asphalt pavements and 30 to 40 years for concrete
pavements. It appears that whole life costing is used primarily for the comparative
evaluation of asphalt and concrete pavement alternatives, particularly for high cost
projects. Lack of accurate data is one of the reasons given for not always using whole
life costing.
Hungary Design standards for new pavements taking whole life costs into
account are currently being developed.
Israel There are no concrete roads. A 20 year design life for asphalt
pavements has been based on literature surveys and economic
analyses.
Research in this area is being carried out in several countries with positive responses
from 14 organisations. Brief descriptions of the work being carried out in some of the
countries are:
Algeria Study of costs of construction and costs to the road users. Use of the
World Bank HDM III model for maintenance schemes.
Canada - Qubec Work mainly consists of keeping up with technology and reviews of
recent literature.
Poland Some work on whole life costing is being carried out for the
assessment of innovative products.
Major rehabilitation 4 10 8 4
Routine maintenance 1 6 7 12
None of the countries have a general policy to take whole life costs into account, either
for pavement construction or maintenance. Question 1 showed whole life costs are
used widely to compare asphalt and concrete options. In general, whole life costing
which takes into account future maintenance costs (and sometimes user costs) is used
mainly for new construction if the projects costs are high, the work is privately financed
or the projects are funded by a major international funding agency. However, budget
restrictions can sometimes result in the selection of a non-optimal alternative.
Whole life costing is not seen as important for routine maintenance work because costs
are generally low. With major maintenance, costs are generally lower than for new
construction and, often, alternative choices are limited, (e.g. rehabilitation of highways in
Japan is limited to one option involving milling and overlay). Where the major
maintenance work costs are high, whole life costing may be considered for the
comparison of options, (e.g. in Canada, whole life costs are used for projects costing
more than C$1M).
Only Germany and Poland said whole life costing is not used but Australia and USA
suggested approaches were different between States. In the USA, whole life costing in
some form is generally used in all states.
Whole life costing is often considered for the initial selection between asphalt and
concrete pavement types but not very often then used for evaluating actual alternative
tenders for the new pavements. In most countries, the selection of new road projects is
based either on lowest initial works cost or lowest cost including an allowance for future
maintenance. The latter option is more likely to be used for high cost or long life
projects. User costs are currently included in the evaluation only in a small number of
countries although it appears that the subject is being debated in other countries (e.g.
USA).
Different countries consider various other factors. Some of the external factors
considered are:
Whole life costs are mainly considered for high cost new construction projects that are,
principally, motorways.
As with new pavements, maintenance options are evaluated on the basis of lowest
works costs or lowest works cost with some allowance for future maintenance. There is
limited use of road user costs in the evaluations.
Noise, safety requirements (e.g. reduction in vehicle water spray) use of recycled or
waste materials, traffic disruption (particularly urban areas) and roadworks duration are
given as the main non-quantifiable factors.
Where pavement management systems are in use or under development (e.g. UK,
USA, Israel) the facilities to deal with future maintenance costs and road user costs are
included.
ii) Drainage 3 4 8 13
Whole life costing is used mainly for evaluating construction and major maintenance
options for pavements and maintenance options for bridges. It should be noted that the
approach is not adopted for drainage and foundation improvements.
Whole life costing is mainly applied on major maintenance (strengthening) schemes (i.e.
rehabilitation, strengthening treatments) and sometimes for the application of new
surfaces. Crack sealing and patch repairs are treated on an annual basis.
Crack/joint sealing 5 5 3 15
Question 9: If whole life cost procedures include an allowance for road user
costs, please indicate which costs are considered?
Road user costs are considered by only a few countries. These costs consist mainly of
user delay costs at roadworks and the journey time and vehicle operating costs incurred
during normal operation. Journey time costs and vehicle operating costs are generally
related to pavement condition.
The role of user costs did not appear to be clear. Only Japan said that user costs have
a definite role, in the choice of materials.
2 8 4 8
Journey time costs
2 9 3 7
Are these costs adjusted to reflect varying
pavement condition during the whole life cost
analysis period?
2 5 4 10
Vehicle accident costs
0 4 4 12
Are these costs adjusted to reflect varying
pavement condition during the whole life cost
analysis period?
4 6 3 9
Vehicle operating costs
2 4 5 8
Are these costs adjusted to reflect varying
pavement condition during the whole life cost
analysis period?
Question 10: To what extent are road user costs applied (as identified in
Question 9)
b) Project level 3 8 7 4
User costs are applied at the network level and project level in a total of 14 countries
with 6 countries including them at both levels and 4 countries at only one level (e.g. in
Israel user costs are included within the network level pavement management system
while in the USA, whole life costing is used only at the project level to compare
pavement construction options).
Question 11: Are works/agency costs and road user costs given the same
weighting in whole life cost analyses?
10 6 3 3
Works/agency costs and user costs are kept
separate in assessments
Where used, works and user costs are generally given the same weighting. Where the
weightings are different, the actual values vary between different countries. Thailand
and Sweden give greater weighting to user costs (60%) than works costs (40%), while
the Netherlands, Finland, Portugal and Switzerland give greater weighting to works
costs.
Works and user costs are calculated separately. User costs are sometimes used as a
separate decision criterion (e.g. in Japan, it is used sometimes to rationalise the use of
expensive materials).
Question 12: At a project level, how is the requirement for future maintenance
determined?
Note: Each country appears to have interpreted future maintenance quite differently
and the answers may not refer to predicting a future profile for use in whole life cost
analyses.
Dependent on time 4 13 4 5
Future maintenance requirements are determined from both engineering judgement and
deterministic performance models based on traffic, time and other factors:
Romania Climate
Dependent on time 3 11 4 4
Future maintenance requirements at the network level are determined is a similar way
to those at the project level. Israel is developing a pavement management system for
network level analysis. In England network whole life cost models are being developed
for use in national and local networks of trunk roads. There is a greater use of
probabilistic models at this level.
Germany is currently developing a database using data from the 3 year routine surveys.
In Hungary, 61 trial sections have been monitored since 1991 to build data for
performance models. Updating is expected to be part of the pavement management
system under development in many countries.
Question 15: Is the residual life of the pavement included in the assessment
of whole life costs as a measure of structural condition?
Japan Residual life is currently not used, but is being researched. Falling
Weight Deflectometer measurements may be used to determine
residual life.
Discounting is used in many of the countries and where used it is usually applied
throughout the assessment period. The annual discount rates used vary between 3 to
12%, distributed as shown below:
In Austria, the difference between the interest rate and inflation rate is used. In
Romania, the discount rate is based on the inflation rate. An annual discount rate is
expected to be included in the pavement management system being developed in
Israel, the actual value is yet to be decided. There was no link in the data to assign the
discount rates used to the pavement type being analysed.
Question 17: What evaluation period do you use for calculating whole life
costs in the following situations?
Maintenance
- Asphalt 5 10 1 1 0
- Concrete 8 4 3 2 0
Network evaluation 4 4 4 1 1
Evaluation periods are variable but in general, new construction projects are evaluated
over a longer period than maintenance projects and concrete pavements are evaluated
over longer periods than asphalt pavements. Network evaluation periods vary over a
wide range from 3 to more than 40 years.
Japan No decision has yet been made on evaluation periods to be used for
whole life costing, but it is expected to be in the region of 40 to 50
years.
Question 18: Do you evaluate the asset (pavement) condition and/or its value
at the end of the evaluation period?
Some of the methods used to evaluate the asset value at the end of the evaluation
period are:
Austria Used for comparing different construction types with different design
lives and is calculated from the percentage of remaining life related
to the costs of new construction
Canada - Qubec Residual value is proportional to the cost of the last major
intervention multiplied by the proportion of the residual life in relation
to the life of this last major intervention
France Asset value is estimated as the cost of works required to restore the
pavement to its "as new" condition
Japan It is planned to use FWD data to determine asset value (cf.: Residual
life)
The main use of whole life costing is for the comparison of design options (asphalt and
concrete) at different stages of the tendering process. Whole life costing is also used to
consider environmental effects.
Question 20: Are optimum whole life costing needs considered in budget
allocations?
This facility is included in pavement management systems but is rarely used at present.
Hungary plans to use include whole life cost considerations for budget allocations in the
near future. In Japan, the Ministry of Construction takes into consideration long-term
costs when preparing 5-year road improvement plans. Canada-Qubec uses a
pavement management system for the prioritisation of the available budget and
optimisation of constrained budgets rather than whole life costing.
Network Project
Measurement technique
Visual condition:
manual systems 18 2
automated recording/manual interpretation 10 11
automated recording/automated interpretation 7 6
Longitudinal profile 19 22
Transverse profile 16 20
Texture 10 11
High-speed skid resistance 10 14
Low-speed skid resistance 4 13
Benkelman beam 2 10
Deflectograph 8 6
Falling Weight Deflectometer 11 21
Other 3 2
Residual life evaluation based on:
Surface condition 13 13
Structural condition 12 17
Other techniques identified were: Dynaflect, video surveys and the Curviameter
In France, at the network level, a global indicator (within a scale of 0 to 20) is used to
represent condition. The indicator is based on surface and structural condition and the
cost of restoring to as new condition.
The high numbers of responses showing use of high and low speed skidding resistance
at the project level, suggests the question has not been understood.
Yes No
Residual life is used
as part of general condition index 9 15
to represent structural condition only 11 8