FEL has improved over time and with it the estimates. Combining all estimate classes and time periods, European project estimates are better behaved than those elsewhere in the world. The use of Monte Carlo and similar simulation routines for setting contingencies has been much more common, but has had no effect whatsoever on the accuracy of the contingency-setting process. We underestimate engineering and project management costs more than any other category. We have tended to overestimate construction costs.
Revamp projects are as well estimated as any other type of project.
We believe this position to be fundamentally mistaken, but it reflects a failure of cost engineers to explain the role of cost engineering in business success. The role of the cost engineer in selecting better business projects and making project cost effective as well as cost predictable has yet to be understood in most industrial companies. Good FEL Reduces Risk 5. Much More than Contingency in Estimate 6. Does Not Vary by Project Type 7.