The purpose of this paper is to introduce the basics of life cycle cost analysis for use in an undergraduate, senior-level capstone, gas turbine engine design course.  This paper will support the heightened interest within the military acquisition community that now requires life cycle cost analysis to be included in the proposals submitted by military contractors.  The capstone course includes both the gas turbine engine cycle selection and engine component design that is focused on a particular aircraft application.  While our students have been taught how to estimate the engine development costs, the time-varying production costs of engines, and fuel costs, they have not yet been provided instruction on how to factor all three types of costs into a proper engineering economics, time-value-of-money analysis. This paper will fill that gap and serve as a resource for the students who must now consider life cycle cost as an element in their design decision matrix along with engine performance, technical risk, and development time.  The typical case compares one engine where the upfront development and production costs associated with an advanced level of technology are high early on in the life cycle but over time has a lower fuel cost compared to a derivative  engine with a lower development  and production costs but with a higher fuel cost over time.  The paper uses an example to illustrate how the aerodynamics, thermodynamics, and engineering economics can be brought together to inform and defend a decision about which of the two (or more) alternatives is best.  This paper will build on past work that demonstrated how to estimate dry engine weight as a function of engine cycle parameters (e.g. bypass ratio, overall pressure ratio, etc) and sizing considerations (i.e. fan diameter).  The dry engine weight is important because it is a major influence on engine production cost.  This paper will also build on past work that describes how development cost scales with the level of technology that is driven chiefly by the rotor inlet temperature.   While fuel cost is just one component of overall operating costs along with such costs as maintenance and crew support, only the fuel costs will be considered in this analysis since it will likely be the key differentiator between the engine design alternatives (at least at this preliminary design stage).  The engineering economic analysis is spreadsheet based and uses the Net Present Value function which calculates the present value of the upfront investments made in engine development, the cost over time of producing the engines (both negative values), and the fuel cost savings (positive values) relative to the engine alternative with the greatest fuel cost.  The annual discount rate used in the spreadsheet will be an estimated inflation rate.  The higher the resulting Net Present Value, the more desirable that particular engine is from a life cycle cost perspective.  The final decision on which engine to select will be based upon the Net Present Value along with other factors such as engine performance, technical risk, and development time.


Introducing Life Cycle Cost Analysis in an Undergraduate Gas Turbine Engine Design Capstone Course

Division / Sponsor:
International Gas Turbine Institute (IGTI)

Paper Proceedings: https://asmedigitalcollection.asme.org/GT/GT2020/volume/84058

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