Improving the Efficiency of Engines for Large Nonfighter Aircraft (2007) / Chapter Skim
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9 Acquisition, Financing, and Support
9 Acquisition, Financing, and Support
Pages 106-122
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From page 106... ...
Perhaps the most studied aircraft is the B-52, the subject of countless DoD analyses. Despite these studies, no large nonfighter aircraft has ever been re-engined for fuel savings purposes only.
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From page 107... ...
OPTIONS IN GROUP 1 The committee believes the Air Force should adopt the options in Group I, sunnmarized in Table 9-1, right away. Of the four options in this group, the committee finds that the first (maintain commercial derivative engines to Federal Aviation Administration (FAA)
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From page 109... ...
Option 1: Maintain All Commercial Derivative Engines to FAA Standards The FAA sets airworthiness certification and safety standards for commercial engines and regulates the maintenance of these engines. To date, the Air Force has chosen to maintain its engines to its own standards.
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From page 110... ...
Finally, should the competition result in Air Force engines being maintained in a commercial shop or a commercial user teaming with the Air Force to overhaul its engines in an Air Force depot along with Air Force engines, commonality of engine configuration, recommended in Option 1, could more easily be maintained. In summary, the expected benefits include (1)
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From page 111... ...
Option 3: Create a Line Item in the Defense Budget While there is common agreement on the benefits of engine modifications or re-engining (lower fuel consumption, better performance, reduced maintenance costs, etc.) , such efforts have been stymied by the need for upfront procurement financing and the estimated long times for realizing the financial benefits of so doing.
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From page 112... ...
6) LCCs here are defined as the "sum of the present values of investment costs, capital costs, installation costs, energy costs, operating costs, maintenance costs, and disposal costs, over the lifetime of the project, product, or measure." (Additional guidance on measuring life-cycle costs is specified in 10 CFR 436.19.)
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From page 113... ...
OPTIONS IN GROUP 2 The committee believes the Air Force should aggressively evaluate the options in Group 2, summarized in Table 9-2, to determine their true utility. Option 5: Re-engine Air Force Aircraft with Commercial Engines and Lease or Resell the Engines When the Airframe Is Retired In this option, the Air Force re-engines its existing aircraft with engines that are expected to be widely used in the commercial fleet beyond the planned retirement date of the Air Force airframes on which they will be mounted, then leases or resells the engines upon airframe retirement.
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From page 115... ...
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From page 116... ...
candidate engines would be limited to those that are available in the commercial sector, which may (though this is unlikely given the broad capabilities of commercial engines) have an impact on Air Force ability to meet mission requirements, (2)
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From page 117... ...
the lessor retains residual value of engines at the end of the lifetime of the airframe on which they will be mounted because it can lease or sell the engines in the commercial engine market when the airframe is retired, and (3) the Air Force gets the best possible leasing rate (equivalent to the Treasury borrowing rate)
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From page 118... ...
the Air Force would not own the engines, which might be a concern for the Air Force and for Congress, (3) the Air Force would incur a premium for having the flexibility to forgo future leasing at the end of each year, but any such premium would be small—probably equal to the expected holding cost—because the engines would be commercial engines amd could therefore be leased or sold in the commercial market should the Air Force choose not to continue leasing them, amd (4)
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From page 119... ...
Air Force would not own the aircraft, which might be a concern for the Air Force and for Congress. Congressional approval would be required for multiyear leasing arrangement; however, there is a precedent for the granting of a waiver as per the DESC multiyear contracts.
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From page 120... ...
congressional approval would be required for a multiyear leasing arrangement despite the precedent set by the DESC multiyear contracts for the granting of a waiver, and (3) owing to the long-term nature of the lease, OMB accounting rules might have to be modified so that the money that is borrowed by the lessor does not count against the Treasury borrowing limit.
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From page 121... ...
the Air Force does not have to pay for any required modifications to the airframe, (2) it has no significant initial capital outlay, (3)
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From page 122... ...
The Air Force should analyze the following options in greater depth to determine their feasibility: (1) sale-and-leaseback on a long-term basis and (2)
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