Estimating Cost in TSIP Proposals

Estimating the Value of Nights For Telescopes < 6.5 Meters Aperture in TSIP Proposals

Because existing telescopes < 6.5 meters in aperture are typically older, we recognize that amortizing their original construction costs over 20 years following their completion may not be the most appropriate formula for determining the cost of one night of observing time. We propose the following guideline:

Suppose that the capital value of one of these older telescopes is the current estimated cost to build a telescope of similar characteristics reduced by a factor equal to inflation over the last ten years.

For example, a 4.2-m telescope with initial instrument complement (e.g., SOAR) could be built for approximately $42 million. Cumulative inflation over the last ten years has been approximately 28%. Therefore, the “ten-year-old” value of this telescope is $32.8 million, and the capital contribution to the value of a night is $1.65 million per year (still amortized over 20 years).

Last updated or reviewed February 22, 2011.