In a complex period like the one we are experiencing at a global level, the issue of cost control is crucial for any product at every stage of its life, from purchase to maintenance, up to disposal and recycling.
Total Cost of Ownership (TCO) – the methodology evaluating the economic performance of materials – is considered the most effective method to provide an analysis of the users' monetary costs throughout the products’ lifetime. TCO is therefore a ‘customer-centric’ analysis aimed to account for the difference between the purchase price of something and its long-term cost.
The TCO methodology is increasingly used in public procurement, and it is considered highly relevant, in perspective, also by primary companies operating in the cable sector. For this reason, PVC4Cables commissioned the expert consultancy firm Althesys an analysis of PVC cables’ competitiveness, through assessing the cost savings resulting from the use of PVC, instead of the main functional alternatives, along its entire lifetime.
The study analysed the most common alternative cables (a 100 meters long cable suitable for Low Voltage connections) for residential buildings, industrial buildings, and telecommunication, in France, Germany and Italy.
The TCO study is based on the following main assumptions:
- Cable prices and installation costs refer to the final users of investment.
- The buyers of electric cables (final users) for residential buildings are private house owners.
- The buyers of electric and data cables (final users) for industrial building and telecommunication are considered to be private industrial companies.
- For each country, the prices for cables are an average of three official price lists; discounts on price lists have been considered. Installation costs have been estimated taking into account the different labour costs in the countries.
- The period of usage is considered to be 30 years for all cables.
- The real life can clearly go beyond, depending on the conditions for laying the cable. Cables, if correctly projected, sized and posed, do not need maintenance. The total substitution of cables is cheaper.
- The costs for use due to energy consumption (thermal heating of cables) are not significant if cables are manufactured and installed according to standard practices.
- Dismantling costs, considered at the end of cable life, have been estimated in relation to dismounting and transfer of cables to landfill, net of copper recovery. Costs differ among cables depending on their weight.
- PVC recycling was subject to a separate study of Cost Benefit Analysis (CBA).
In all investigated applications (residential building, industrial building, and telco data) and countries, cables made with multiple PVC parts (PVCx2) showed the lowest total cost of ownership. The higher is the PVC quantity contained in the cable, the lower is the TCO value.
The Cost Benefit Analysis (CBA) approach allows to examine the direct and indirect costs of a project (or an investment, a system, a technology, a plant, etc.) for the community (or a Country) as a whole.
The CBA of PVC recycling considered two different scenarios in France and Italy – recycling compared to landfill disposal and recycling compared to incineration, and one in Germany, where landfill is not allowed.
The most critical phase is collection, sorting and cleaning of PVC. This activity is complex and expensive because the quantity of PVC can be diluted in a large number of applications and, in many products, PVC is coupled with other materials, which requires the use of specific technologies for its separation.
CBA results show net benefits of recycling for all cases considered: vs incineration or vs landfill, both for electric and data cables. In France and Italy, net benefits of recycling vs landfill are greater than recycling vs incineration due to energy recovery (electricity and heat) in incineration. The higher is the quantity of PVC in the cable, the higher is the net benefits of recycling.
The cable FS18OR18 (with sheath and insulation in PVC) shows greater net benefits than the data cable (containing also thermoplastic), due to higher quantity and quality of PVC recycled.
All CBA results consider an adequate territorial coverage of PVC cables collection and recycling sites. Increase in the distance could reduce the net benefit of recycling. The monetisation of copper recovery increases net benefits a lot, but also without considering the value of recovered copper, the CBA net balance is positive.