Life Cycle Cost Analysis

Orenco can help you evaluate your wastewater options. If considering only upfront capital costs, wastewater system owners often find themselves in a difficult situation a few years down the road.  We can help you to analyze long-term costs and determine the most viable option for your situation.  Give us a call.

Effluent Sewer vs. Gravity Sewer

Effluent Sewer vs. Grinders

Operation & Maintenance


Gravity Sewer Excavation


Effluent Sewer Shallow Trenching

Analyzing the True Costs of Community Wastewater Systems

Life cycle costs take all costs into account, which is particularly important for small communities, because communities bear the responsibility of maintaining the system, for the life of the system, after it is installed.  Upfront costs may be misleading because they only represent one part of the overall cost of a system.  

The full life cycle cost of a system is based on costs over time, while taking into account the component with the longest life cycle.  We suggest 60 years when communities are comparing the costs of conventional gravity sewers to the costs of other sewer technologies.  Why?  If the life cycle is set at 20 years, the analysis often ignores gravity sewer costs of repairing/replacing lift stations or repairing piping to reduce I&I (infiltration and inflow) at 50 years.  Full life cycle cost analysis avoids unfairly burdening a community's future generations with unexpected repair costs.  An arbitrary 10 or 20 year cost analysis would be akin to analyzing mortgage options and ignoring the balloon payment on a 7-year adjustable rate mortgage!

The life cycle cost of wastewater collection and treatment systems includes design and construction, repair and replacement (R&R), and operation and maintenance (O&M).  To avoid financial problems in the future, differences in the costs for each technology under consideration must be evaluated during the selection process and planned for in the management and rate-setting process. 

A good example of the importance of life cycle cost analysis is the trouble caused by inadequate rate structures for systems that were installed with Clean Water Act grants.  Repair and replacement costs were overlooked in the rate structures, and today, decades later, as this infrastructure reaches the end of its useful life, cities cannot afford to repair/replace them.

It is also important to consider costs from all four parts of a community wastewater system: On-lot, Collection, Treatment, and Dispersal.  For example, effluent sewer collection employs passive digestion in on-lot interceptor tanks; this allows significant reduction in treatment capacity (and cost) requirements downstream, a feature not offered by grinder or gravity sewer systems.  Effluent sewer systems provide primary treatment, reducing solids by about 80%.  They are often followed by less costly secondary treatment facilities such as packed-bed filters, constructed wetlands, or lagoons.


Effluent Sewers vs. Traditional Gravity Sewers

With their full-time operations, complex controls, and large up-front capital costs, conventional wastewater technologies make sewering small communities financially difficult, if not impossible.  The per-house cost of gravity sewer in the U.S. rarely comes in under $15,000 and often is as high as $30,000 or more!  Whereas the cost of an effluent sewer typically ranges between $6,000-$10,000 per connection.

Effluent sewer is adaptable and expandable to changing service needs and/or service area.  Because the collection system can be installed incrementally as demand increases, there is no inequitable financial burden on current users of the system.  Also, if the customer base fails to expand as anticipated, existing users are not forced to support unused infrastructure.

With decentralized technologies like Orenco's effluent sewer and AdvanTex treatment, full-time operators are uncommon; operators are typically hired part-time or simultaneously serve in other capacities, such as road superintendent or community board member.

Effluent sewer lines can be installed in half the time, with corresponding reduced interest payments and earlier commissioning and rate recovery.   

With effluent sewer, no deep (and costly) excavations are necessary...just a shallow trench that follows the contour of the land.  The effluent sewer itself consists of small diameter mainlines (2-4 inch; 50-100 mm), and clean-outs instead of manholes.  There is far less disruption to the community — and consequently fewer construction complaints — than with a gravity excavation.

Gravity sewers frequently require expensive lift stations; these are only very rarely needed on an effluent sewer system.  As we mentioned above, it is important to use a life cycle period long enough to account for repair/replacement costs of these lift stations and other major components of a gravity sewer system.

Gravity systems are known to suffer from significant groundwater infiltration and stormwater inflow.  This requires downstream treatment plants to process more water than would ordinarily result from wastewater activities.  Effluent sewers are designed to be watertight, allowing for smaller, more efficient downstream treatment.


Effluent Sewers vs. Grinder Systems

Grinder collection systems collect raw sewage from each property in an underground basin, grind it, and pump a slurry to a centralized treatment plant or neighboring sewer.

Since effluent sewer and grinder sewers have some similar benefits as decentralized collection systems, decision-makers often compare them on price.  Up-front costs are generally similar, though in some cases, grinder sewers may cost less up-front because they only use a small underground basin at each property, rather than the larger interceptor tank that's used to provide cost-effective primary treatment — and emergency storage — with effluent sewers.

These up-front cost differences are misleading because they ignore O&M costs.  While design and construction are typically the same for both grinder and effluent sewer, R&R and O&M costs differ significantly; consequently, the life cycle costs for an Orenco effluent sewer are typically lower.

As the following chart shows, half the total 20-year annualized cost of a wastewater system is for O&M and R&R.  That means, if you choose reliable equipment (as opposed to just cheaper equipment) upfront, you'll save money throughout the life of the system.  An incremental increase in equipment cost, however, is negligible over the long run.  For example, a $400 difference in upfront costs equates to little more than $2/month/household over a 40-year term, at 6% interest.


Cost Comparisons for Pump R&R, Pump Power Consumption, and Tank Pumping

Pump Repair and Replacement -- As the following chart shows, pump R&R for grinder systems is more than $8/month/household, eight times higher than that for effluent sewers which runs about $1/month/household in the U.S.

Grinder systems typically use heavier (~90 lb; 41 kg), 1.5- to 2-horsepower, 230V grinder pumps with a repair frequency of 8 to 10 years at a repair cost of up to $800, and a replacement frequency of about 20 years at a cost of $1,500 to $2,000. 

By contrast, effluent sewer systems use lighter (~30 lb; 13.5 kg), 1/2-horsepower, 115V high-head field-repairable effluent pumps with a life cycle of 20 years and a replacement cost of about $500.  


Onsite Pump Power Consumption

Using the U.S. national average of $0.08 per kWh and the pumps specified above, power consumption for grinder systems is nearly $4.50/month/household... nearly four times higher than power consumption for effluent sewer, which is $1.15/month/household.

Onsite Tank Pumping

Onsite tank pumping costs for grinder systems are $0.00/month/household.   That's because grinders typically have no tanks; solids are ground up and pumped to the treatment system, so the cost of treating those solids is transferred to the treatment system.  Tank pumping costs for effluent sewers, on the other hand, are $1.19/month/household.  This assumes a pumpout cost of $250 (pumpouts range from $150 to $350) and a pumpout interval of 12 years, based on four occupants/1500-gallon (6-m3) tank.

Costly lift stations are often necessary with grinder systems, but are rarely necessary with effluent sewers due to the use of high-head effluent pumps.

Operation and Maintenance (O&M) 

O&M basically covers the annual cost of operating and maintaining a selected design technology; this includes maintenance equipment as well as labor.  A survey of effluent sewer projects in Oregon, Washington, and California showed that service calls average only 1.4 hours per month per 100 homes.

As shown in the figure to the left, a typical 1000-gallon (4-m3) on-lot interceptor tank requires pumping just once every 10-12 years.

Twenty-four hour back-up storage in on-lot tanks reduces emergency calls and overtime costs, not to mention sewage overflows.

Additional O&M costs beyond pump power consumption and tank pumping include scheduled and unscheduled service calls, mainline cleaning, and air valve maintenance, all of which are markedly different among gravity, grinder, and effluent sewer.  Communities that are considering an investment in any sewer technology should diligently seek out other communities with comparable systems and ask about maintenance costs.

Upon start-up, effluent sewer systems and conventional gravity systems have significantly different expense models.  O&M expenses for gravity sewer are generally anticipated to be relatively low per customer served.  Before reaching this conclusion, it is important to understand that O&M costs for gravity sewer are more associated with lineal footage of pipe in service than the number of customers served.  Accordingly, O&M costs are highly variable with respect to lot density and the level of build-out.  Start-up O&M costs can actually be very high, relative to the actual number of customers served.

By comparison, effluent sewer O&M costs are generally attached to on-site O&M costs.  O&M costs for the collection main are very low.  Since on-site components of the system are not installed until a customer is being served, O&M expenses tend to be more aligned with revenue-paying customers.

It is true that the parts and pieces of a STEP effluent sewer system cannot be ignored.  STEP systems that operate with insufficient attention to O&M will generally start to see excessive O&M costs as early as 10 years into its service life.  Other manufacturers' STEP systems with lower quality components may see excessive O&M costs occur earlier.  A properly managed STEP system will include ongoing preventative maintenance that keeps the STEP system operating as close to "new" condition as is economically possible.  The cost of O&M should be presented as an optimized balance of preventive and reactive maintenance.

Gravity sewer systems are often operated for long periods of time with little or no preventive maintenance.  While the system is in good condition, the O&M cost will appear artificially low.  Low initial operating costs will ultimately result in higher long term operating costs as elements such as I&I and sewer overflows become more prevalent.

Real life data should be used to validate all manufacturers' claims.  If possible, it's best to visit, tour, and acquire data from alternative systems that have been operational for several years.