The life-cycle costing management tool is used to evaluate projects and measure costs over the life of an infrastructure asset. This tool involves the comparison of construction and material costs, such as asphalt versus concrete, as well as an assessment of future investment requirements − the total cost of operating, maintaining, rehabilitating, and replacing an asset.
The life-cycle costing analysis assists funding decisions by highlighting the total cost of an asset over the course of its life expectancy, rather than focusing on initial construction costs only. This tool enhances decision-making and financial planning by helping decision makers select the most cost-effective infrastructure.