P1- 3.4

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P1- 3.4- COST EFFECTIVENESS MATTERS

To compare the cost effectiveness of different cost-cutting measures, we need to consider:

- Capital costs (buying and installing equipment)

- The running cost (fuel and maintenance)

- Environment costs (Removal/disposal of old equipment or tax charges like carbon taxes of fossil fuels)

- Other costs (interests on loans)

PAYBACK TIME:

-Loft insulation costs £200 and she would fit the insulation herself. This would save £100 per year on the fuel bill so her payback time would be two years

- Cavity wall insulation for a house costs £500 and £100 to fit it. This could save £200 per year on the fuel bill so they payback time would be 3 years

LOOK ON PAGE 61 FOR TABLES ABOUT LIGHTING COSTS