Operating Rate

The Operating Rate is the cost to operate an asset per hour and includes the following expenses:

  1. The cost of labor and parts needed for routine, daily servicing of the equipment. This includes repairing and/or replacing small components such as pumps, carburetors, injectors, filters, belts, gaskets, and worn lines.
  2. The cost of operating expendables. These include fuel, computed in accordance with horsepower, average load factors, and the price of fuel; lubricants, including filters, oil, and grease, as well as the labor and the lube truck involved in lubrication; tires; and ground engaging components, including pads, blades, bucket teeth, etc. Tire costs are calculated by average tire life factors and take into consideration typical discounts from list prices. Electricity costs (where applicable) are calculated according to generally accepted duty cycles for the total motor load.

The Operating Rate assumes that the equipment is in good operating condition. No allowances are made for equipment operating in severe conditions or beyond periodic maintenance services.

The Operating Rate may not include all operating expenses. The cost of extraordinary operating expendables, such as certain ground engaging components, such as hammer and drill bits, drill steel, augers, saw blades, and tooth-bits, are normally excluded because of their highly variable wear patterns. It is recommended that these costs be recovered separately.

Operator’s wages are not included in the Operating Rate/Hour.

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