Lifecycle Cost Model

For each appliance, total cost of ownership over N years is:

Energy cost in year t is the yearly use, grown by a small yearly efficiency loss, times the price, times (1 + g)^t, where g is the price growth fetched from the Bureau of Labor Statistics. Present value discounts each year's cost by (1 + i)^t. The annualized figure uses the capital-recovery factor i(1 + i)^n / ((1 + i)^n - 1).

Sources: the life-cycle cost test of 42 U.S.C. 6295(o)(2)(B)(i)(II); discounting per 10 CFR 436.14(a); the single and uniform present value, capital-recovery and escalating-payment equations (2, 3, 4 and 7) of NISTIR 89-4203.