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152 lines
5.5 KiB
152 lines
5.5 KiB
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\subsection{Lifecycle Cost Planning and Time Value Money (TVM) Analysis}
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\begin{center}
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\textbf{Updated Cash Flow Diagram for Control-Based Station (5-Year Lifecycle)}
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\end{center}
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\begin{tikzpicture}[>=Stealth, scale=1, every node/.style={scale=1}]
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% Draw timeline
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\draw[->] (0,0) -- (6.5,0) node[right] {Time (Years)};
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\foreach \x in {0,1,2,3,4,5} {
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\draw (\x,0.1) -- (\x,-0.1) node[below] {\x};
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}
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% Year 0 - Initial Investment
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\draw[->, thick] (0,0) -- (0,-2.65) node[below] {- \$530};
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% Years 1–4 - Annual Operating Cost
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\foreach \x in {1,2,3,4} {
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\draw[->, thick] (\x,0) -- (\x,-1.2) node[below] at (\x,-1.4) {- \$120};
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}
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% Year 5 - Annual Cost + Salvage
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\draw[->, thick] (5,0) -- (5,-1.2) node[below left] {- \$120};
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\draw[->, thick, green!60!black] (5,0) -- (5,2) node[above] {+ \$200};
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% Labels
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\node at (3,-4.2) {Cash Outflows = CAPEX \& OPEX};
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\node at (5.8,2.4) {Salvage Value};
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\end{tikzpicture}
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\par \textbf{Cost Constrain:} The system is designed with strict cost constraints to ensure affordability for small-scale farmers and homesteaders. The goal is to maintain an annual operating cost below \$200 and a one-time hardware cost under \$1000, as specified in REQ-20 and REQ-26. The cost model incorporates hardware components, connectivity fees, and maintenance buffers.
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\begin{table}[H]
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\centering
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\caption{Estimated First-Year and Annual Operating Costs for Current System}
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\begin{tabular}{|l|l|l|}
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\hline
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\textbf{Category} & \textbf{One-Time Cost (USD)} & \textbf{Annual Cost (USD)} \\
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\hline
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Edge Device (Raspberry Pi 4 + Peripherals) & \$100 & -- \\
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Sensors (Weather Station + Soil Moisture Sensor) & \$200 & -- \\
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4G Modem + SIM Hardware & \$50 & -- \\
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Solar Power Kit + Battery Storage & \$150 & -- \\
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Weatherproof Enclosure & \$30 & -- \\
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Data Connectivity (4G SIM, low-data) & -- & \$6--\$12 \\
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Preventive Maintenance Buffer & -- & \$50 \\
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Cloud/Remote Logging (Optional) & -- & \$60 \\
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\hline
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\textbf{Total Estimate} & \textbf{\$530} & \textbf{\$116--\$122} \\
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\hline
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\end{tabular}
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\end{table}
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\noindent
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The model assumes one centralized edge device performing both hub and compute functions. This reduces recurring data costs by minimizing transmission frequency and eliminates the need for cloud-hosted control services. The architecture supports expansion through additional sensors without significantly increasing operating costs.
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Performing Trade-off study for not using alternatives as mentioned in House of Quality (figure \ref{fig:hoq})
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\begin{table}[H]
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\centering
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\caption{10-Year Cost Comparison: Control-Based vs. Azure IoT System}
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\begin{tabular}{|p{0.3\textwidth}|l|l|}
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\hline
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\textbf{Item} & \textbf{Control-Based System (USD)} & \textbf{Azure IoT System (USD)} \\
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\hline
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Initial Hardware Cost & \$530 & \$300 \\
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10-Year Subscription Cost & \$0 & \$1,800 \\
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10-Year Operating Cost & \$1,200 & \$1,200 \\
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Salvage Value (End of Year 10) & -\$200 & \$0 \\
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\hline
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\textbf{Total Lifecycle Cost} & \textbf{\$1,530} & \textbf{\$3,300} \\
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\hline
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\end{tabular}
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\label{tab:10year-cost-comparison}
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\end{table}
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\begin{table}[H]
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\centering
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\caption{Detailed Annual Operating Cost Estimate}
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\renewcommand{\arraystretch}{1.2}
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\begin{tabular}{lll}
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\hline
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Cost Item & Annual Estimate & Notes \\
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\hline
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Replacement batteries \& parts & \$40 & Rechargeables for sensors, valve batteries \\
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Occasional sensor replacement & \$50 & 1–2 sensors/year \\
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Manual maintenance time (labor) & \$50–\$70 & Self-service \\
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Data storage backup (USB rotation) & \$20 & Flash drives \\
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Cloud Services (avoided) & \$0 & Azure IoT Central typically charges \$5–10 per device/month ⇒ saved \$60–\$120/year \\
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Total Annual Cost & \textasciitilde{}\$160 & Under target \$ 200\\
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\hline
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\end{tabular}
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\end{table}
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\begin{table}[H]
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\centering
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\caption{Financial Model Input Parameters}
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\renewcommand{\arraystretch}{1.2}
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\begin{tabular}{lr}
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\hline
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Category & Value \\
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\hline
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Initial Cost (B) & 625 \\
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Annual Income (Benefit) & 180000 \\
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Annual Operating Cost & 160 \\
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Net Annual Cash Flow & 179840 \\
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Discount Rate (MARR) & 0.12 \\
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\hline
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\end{tabular}
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\end{table}
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\newpage
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\begin{landscape}
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\begin{table}[H]
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\centering
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\caption{6-Year Financial Model with MACRS 5-Year Depreciation (Landscape)}
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\resizebox{\linewidth}{!}{%
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\begin{tabular}{rrrrrrrr}
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\hline
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Year & BTCF & MACRS Dep Rate & MACRS Dep Deduction & Book Value & Taxable Income & Income Taxes & ATCF \\
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\hline
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0 & -625 & 0 & 0 & 625 & -125 & 0 & -625 \\
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1 & 179840 & 0.20 & 125 & 500 & -200 & 0 & 179840 \\
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2 & 179840 & 0.32 & 200 & 300 & -120 & 0 & 179840 \\
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3 & 179840 & 0.192 & 120 & 180 & -72 & 0 & 179840 \\
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4 & 179840 & 0.1152 & 72 & 108 & -72 & 0 & 179840 \\
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5 & 179840 & 0.1152 & 72 & 36 & -36 & 0 & 179840 \\
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6 & 179840 & 0.0576 & 36 & 0 & 0 & 0 & 179840 \\
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\hline
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\end{tabular}%
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}
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\end{table}
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\begin{table}[H]
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\centering
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\caption{NPV and IRR Computation for 6-Year Financial Model}
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\renewcommand{\arraystretch}{1.2}
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\begin{tabular}{ll}
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\hline
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Metric & Value \\
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\hline
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Initial Investment (Year 0) & \(-\$625\) \\
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Net Annual Cash Flow (Years 1–6) & \$179,840 \\
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Discount Rate (MARR) & 12\% \\
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Net Present Value (NPV) & \$851,222.79 \\
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Internal Rate of Return (IRR) & 2882.7\% \\
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\hline
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\end{tabular}
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\end{table}
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\end{landscape}
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