Idle Capital Cost

The fixed cost of carrying automation infrastructure - depreciation, maintenance, and licensing - during low-utilization periods when the system generates no offsetting labor savings.

Separate cash operating costs from accounting depreciation. Model peak and off-peak cash flows over the same investment horizon; idle capacity may reduce benefits without reducing fixed costs. No single demand distribution is assumed.

Related terms: Peak Labor Cost Avoidance · Capital Recovery Period · Peak-to-Average Ratio