Total Cost of Ownership (TCO) in facilities management includes which major components?

• A. TCO is the initial purchase price of a component.
• B. TCO captures only energy costs over a component's life.
• C. TCO includes purchase/construction, operation, maintenance, energy, space, risk, and disposal.
• D. TCO excludes risk and disposal costs.

Answer: (D)

Total Cost of Ownership in facilities management accounts for all costs tied to owning and operating an asset over its life, not just the upfront price. It includes purchase or construction, ongoing operation, maintenance and repairs, energy use, the space the asset occupies, risk-related costs (like downtime, safety, insurance, and regulatory compliance), and end-of-life disposal or decommissioning costs. This broad view lets you compare options based on true economic impact over time. Saying that risk and disposal costs are excluded underestimates TCO and misleads decision-making. The complete description is the one that includes all these lifecycle components.