[Code of Federal Regulations]
[Title 10, Volume 3]
[Revised as of January 1, 2001]
From the U.S. Government Printing Office via GPO Access
[CITE: 10CFR436.22]

[Page 626]
 
                            TITLE 10--ENERGY
 
                    CHAPTER II--DEPARTMENT OF ENERGY
 
PART 436--FEDERAL ENERGY MANAGEMENT AND PLANNING PROGRAMS--Table of Contents
 
   Subpart A--Methodology and Procedures for Life Cycle Cost Analyses
 
Sec. 436.22  Adjusted internal rate of return.

    The adjusted internal rate of return is the overall rate of return 
on an energy or water conservation measure. It is calculated by 
subtracting 1 from the nth root of the ratio of the terminal value of 
savings to the present value of costs, where n is the number of years in 
the study period. The numerator of the ratio is calculated by using the 
discount rate to compound forward to the end of the study period the 
yearly net savings in energy or water and non-fuel or non-water 
operation and maintenance costs attributable to the proposed energy or 
water conservation measure. The denominator of the ratio is the present 
value of the net increase in investment and replacement costs less 
salvage value attributable to the proposed energy or water conservation 
measure.

[61 FR 32651, June 25, 1996]