Economics-Based Payback and Life Cycle Cost Savings Assessment of Inverter Type Air Conditioners

Abstract

Abstract This paper investigates the options for a consumer to choose between different inverter and non-inverter type residential air conditioners (ACs) concerning their payback periods (PPs) and Life Cycle Cost (LCC) savings. The economics-based analysis carried out to evaluate the PPs by which the costs associated with owning and operating 3-star, 4-star, and 5-star inverter AC models are recoverable compared to non-inverter type (baseline model). The product costs (Cp ), the repair costs (CR ), the maintenance costs (CM ), and the energy costs (CE ) are taken as the decision parameters for evaluating the payback periods (PPs). It is shown that PP strongly depends on the energy cost. Estimates of P P s are calculated as the futurs value of present cost involved in buying, maintaining, and running the ACs. It is concluded that inverter technology can save electrical energy by 12-22.4% compared to a non-inverter air conditioner. PP of 3-star inverter AC is estimated 2.17 years while P P of 4-star and 5-star inverter ACs are 2.42 years and 2.33 years for 10 hours operation in a day when a higher slab of unit energy cost is considered. Depending on PP and daily usage requirements, a consumer can choose either a less efficient AC priced at a lower initial cost but more running cost or a more efficient AC priced at a higher initial cost but lesser running cost.