The evaluation of cable costs considers the present worth of funds req
uired for a new cable installation. Two components make up this cost,
first the initial investment cost, and second, the cost of losses over
the life of the cable. Generally for a given voltage class, the capit
al investment component increases as the conductor size increases. Con
versely, the losses decrease as conductor size increases. Selection of
cable size is currently based on ampacity considerations; that is, a
cable with a minimum acceptable cross-sectional area is usually select
ed without consideration of the cost of the losses that will occur dur
ing the life of the cable. Since the cost of losses over the lifetime
of the cable may be quite substantial, selection of a larger conductor
size than required for ampacity consideration will often result in sm
aller value of losses and, hence, may lead to a lower overall cost. A
number of examples which demonstrate sensitivity of the conductor cros
s-section and overall cost to variations in key parameters of the mode
l are presented in the paper.