Structure for cost estimates and funding needs (FCCIS M4.1)

Methodology : The methodology adopted for cost estimation was developed following the StR-ESFRI "Guidelines on cost estimation of research infrastructures" (2019) and the European Commission's "Guide to Cost-Benefit Analysis of Investment Projects (2014). These documents provide a reference framework for the identification and measurement of costs of any research infrastructure.

Main assumptions :

Time profile: Costs estimates are provided over a period of 37 years, from 2021 (assumed year of start of feasibility studies) until 2057 (assumed last year of exploitation of the FCC-ee results).

Unit of measure: Figures are expressed in CHF, in real terms at 2021 prices. These figures are subject to further changes, especially in the light of increasing energy costs experienced 2022.

Cash flow approach: The cost accounting follows a cash flow method. Depreciation, reserves, price and technical contingencies and other accounting items which do not correspond to actual flows are disregarded. In case of in-kind contributions, their corresponding economic value should be included.

Scenario: Costs estimates included in this document are referred to a baseline scenario. More optimistic and pessimistic scenarios are being developed by CSIL and CERN.

Cost item considered: A general distinction between Investment and Operating costs is made. Investment costs relate to the acquisition and development of durable, tangible and intangible, assets, necessary to allow the project to enter an operating phase. They include pre-investment costs, covering feasibility studies. Operating costs include all disbursements (both in-kind and outflows) needed to operate and maintain the FCC-ee research infrastructure during the entire project time horizon. At the end of its lifetime, the FCC-ee infrastructure could be, at least partly, re-used for subsequent projects. Therefore, no costs of FCC-ee dismantling and infrastructure adaptation at the end of its lifetime have been included in the cost estimates.

Specific assumptions for particular cost items:

Pre-investment cost: This cost item covers feasibility studies occurring between 2021 and 2027, including the related labour costs. They are estimated to be 1.3% of the total investment cost, and to have a S-shape distribution in the considered time period. This estimate is in line with standard international practice for the preparation of industrial feasibility studies for large and high-tech projects.

Personnel (labour costs): They are based on the gross salary, which includes: net wages, taxes, and social contributions payable by the employers and employees. Gross salaries were calculated for the following job categories: Scientists, Engineers, Technicians, Undergraduate students, Doctoral students, Post-doctoral students, and Staff and Administration. Estimates were made by considering the most recent pan-European studies and databases reporting data on personnel’s annual salary. The total FCC-ee labour cost was obtained by multiplying the unit gross salary for each job category by the expected number of people in the specific job category for each year of the project time horizon.

Ordinary maintenance and repair: They include costs occurring during the reference period to replace short-life machinery and/or equipment and maintain the facility in operation.

Major upgrades: They refer to additional costs that will mainly occur during that operational phase, for further upgrades in the infrastructure.

Utilities and services; Consumables: They include the cost of energy, other services (water, heating, computing and telecommunication, etc.), and any raw or (semi)processed materials and components necessary for the project operation, including their transport costs from the source of supply to the facility (helium, nitrogen, working gases, etc. ). They are estimated by multiplying the unit cost of each item by the quantity expected to be consumed by the project. Unit prices of energy have considerably increased in 2022 due to a sudden change in the macro-economic scenario and market conditions. These changes will be accounted for in a subsequent version of this document.

Management and administration: They are assumed to be a fixed share of the labour costs (overheads) required to properly run the project on a daily basis. Examples include costs for offices, postage, insurance, office supplies, general telephone and internet usage, heating, electricity, accounting and legal services, human resource services. A 25% flat-rate has been used for overheads, in line with the European Commission’s guidelines for “Indirect costs” estimation in H2020 projects. The 25% flat rate is calculated for all job categories.

Communication and promotion: It includes the costs for promotional activities and other outreach expenditures associated with the FCC-ee project.

Last update: 28/04/2022

Author: CSIL and CERN

-- JulieHadre - 2022-05-12

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