Financial Study for Sustainable Computing e-Infrastructures

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There are many methods for studying service costs in existence, but after careful study, e-FISCAL found none were a good fit for the project. Methods like Total Cost of Ownership (TCO) tend to be used to look into the future, over the full lifetime fo, say, an equipment purchase. They use detailed data then make simulations based on future conditions. In comparison, techniques like Full Cost Accounting FCA) look at the actual costs incurred, through highly detailed line item input data and lengthy calculations. Both might work, depending on the circumstances, for a single organisation, but when assessing costs across the e-Infrastructure market a different approach was needed. We have chosen a method based on estimated operational costs from e-Infrastructure centres, to make data collection easy enough that we can reasonably ask participants to gather it. We then simulate annualised Infrastructure costs for 2010 and 2011 to give an estimated Annual COst of Ownership for those two years

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The methodology that we will use in order to approximate the total yearly cost of ownership is the following:

A) Simulation of the physical infrastructure:

We will approximate the investment cost of the infrastructure by taking into account the capacity in logical CPUs, storage devices, connectivity interconnection devices and auxiliary equipment and actual purchase values corresponding to each specific site/centre. Cross-checks with available accounting data will be performed.

B) Development of the financial model:

The financial model will be based on two pillars. The annualized cost of the simulated physical infrastructure and the operating cost of the physical infrastructure.

B1) Annualized cost of the simulated physical infrastructure. We will use the depreciation rates to annualize the cost of the physical infrastructure simulated in the first phase.

B2) Operating cost of the physical infrastructure. This cost dimension corresponds to the yearly costs for running the site/centre. Information about the operating costs will be gathered at a cost category level (e.g. personnel costs, electricity, etc.) in order to permit the performance of several cost break-down analyses and economies of scale assessments.

The yearly cost of ownership will be calculated for years 2010 and 2011.

In all cases cross-checks with available data (from EGI, PRACE, market or other literature sources) will be performed. The financial analysis results will also be complemented by performance benchmarking efforts.