Time-Valued-Technology: A Light-Emitting Diode Case Study for Determining Replacement Strategy for High Technology Infrastructure Items
AIR FORCE INST OF TECH WRIGHT-PATTERSON AFB OH GRADUATE SCHOOL OF ENGINEERING AND MANAGEMENT
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Infrastructure projects have typically involved long-term investments in relatively mature technologies characterized by stable performance and cost. However, with the ever-increasing rate of technological innovation, an increasing number of potential infrastructure investments involve a decision to replace a traditional technology with a rapidly evolving technology. In such circumstances, it is possible to reap significant performance or cost advantages through near-term replacement. However, this rapid adoption strategy has the potential to incur an opportunity cost due to increased performance or cost advantages the technology would provide if replacement was delayed. This research develops a cost analysis method, referred to as time-valued-technology, which may be useful in developing a strategic approach to the replacement of infrastructure with a rapidly emerging technology. The utility of this method is illustrated through an evaluation of replacement of the 250-watt streetlight fixtures on 64 United States Air Force installations with light-emitting diode based technology. Potential financial savings in implementing time valued technology over existent methods ranged from 1.10 to 14.15 percent per installation, averaging 6.77 percent.
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