Unit Rate Determination

A unit rate is the average or quoted cost of constructing or delivering a unit quantity of a particular item.

Unit rates are used to value or revalue most infrastructure asset types. The total value of a particular group of assets is found by multiplying the quantity of assets by the unit rate adopted for that asset type.

For example if a Council has 175 km of 300 mm diameter stormwater pipes and 300 mm stormwater pipes are know to cost $200/m to install, the total value of all 175 km of 300 mm pipes would be 175,000 * 200 = $35,000,000.

Likewise if the overall cost of laying 3 km of 300 mm storm water pipes in a particular year is know to be $650,000 then this equate to a unit rate of $216.67/m.

Where a supply contract exists and unit rates are included in the supply contract these rates are often used for valuation purposes.

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