Definition:
A feasibility-level estimate used for project studies, alternative evaluations, and funding requests when a limited amount of scope definition is available (1% to 15%).
Key Components:
- Project Definition: 1% to 15% scope maturity.
- Accuracy Range: Typically -30% to +50%.
- Methodology: Uses parametric estimating and cost-factor analysis, incorporating some preliminary engineering data.
- Contingency Level: High, but lower than Class 5, accounting for project uncertainties.
Use Cases/Industries:
- Power Generation Projects: Evaluating the cost-effectiveness of nuclear vs. natural gas plants.
- Pipeline Projects: Estimating costs of routes before finalizing engineering.
- Refinery Expansions: Budgeting for new process units based on historical costs.
Advantages:
- Refines Project Feasibility: More detailed than Class 5, improving decision-making.
- Supports Investment and Go/No-Go Decisions: Used in funding applications and economic justifications.
Challenges:
- Limited Scope Definition: Costs may fluctuate as engineering progresses.
- Still Considered High-Risk: Requires validation before formal budget approval.
Related Terms:
Study Estimate, Budget Screening, Investment Planning
Example:
A wind farm developer prepares a Class 4 estimate to assess the capital cost and viability of a 500 MW offshore wind project before seeking investor funding.
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Synonyms:
Feasibility Estimate, Preliminary Estimate
