What is the purpose of a Life Cycle Cost Estimate (LCCE)?

• A. Acquire funding for a system throughout its lifespan
• B. Estimate annual operating costs
• C. Identify the most cost-effective supplier
• D. Determine the initial procurement price

Answer: (A)

A Life Cycle Cost Estimate is used to determine the total funding needed for a system across its entire life, from initial acquisition through operation, sustainment, upgrades, and eventual disposal. This broad view helps decision-makers secure funding upfront and over time, ensuring resources are available when needed and allowing true comparisons of alternatives based on total cost of ownership rather than just the upfront price. While operating and support costs are included, the purpose isn’t limited to yearly expenses or to choosing a supplier or setting the initial price—it’s about the full cost to own and operate the system over its whole life.