How Machine Cost per Hour Is Calculated

The Formula

CrafterBy calculates machine cost per hour in two steps, then sums them:

Step 1: Hourly Depreciation

Annual depreciation  = (Purchase price - Residual value) / Useful life (years)
Hourly depreciation  = Annual depreciation / Annual hours used

Step 2: Electricity Cost per Hour

Electricity cost/hour = Power (kW) x Electricity rate (currency/kWh)

Total Machine Cost per Hour

Total cost/hour = Hourly depreciation + Electricity cost/hour

Worked Example: CO2 Laser 60W

Using these values:

Purchase price: €1,200
Residual value: €0
Useful life: 5 years
Annual hours used: 1,000 h
Power consumption: 0.6 kW
Electricity rate: €0.25/kWh

Annual depreciation: (1,200 - 0) / 5 = €240/year

Hourly depreciation: 240 / 1,000 = €0.24/hour

Electricity cost/hour: 0.6 x 0.25 = €0.15/hour

Total machine cost/hour: €0.39/hour

Worked Example: Prusa MK4 3D Printer

Purchase price: €900
Residual value: €0
Useful life: 4 years
Annual hours used: 800 h
Power consumption: 0.25 kW
Electricity rate: €0.25/kWh

Annual depreciation: 900 / 4 = €225/year

Hourly depreciation: 225 / 800 = €0.28/hour

Electricity cost/hour: 0.25 x 0.25 = €0.0625/hour

Total machine cost/hour: approximately €0.34/hour

How Annual Hours Affects the Calculation

Annual hours is the single biggest variable you control. It represents how many hours per year you expect to run the machine productively. If you set it too high, the depreciation per hour looks low — but in reality the machine wears out faster than the cost you are charging. If you set it too low, the depreciation per hour looks high.

A useful rule of thumb: start with a conservative estimate (the hours you are confident you will use, not your optimistic ceiling). You can adjust it later as your actual usage data builds up.

What the Formula Does Not Include

The formula covers depreciation and electricity. It does not automatically include:

Consumables (laser tubes, nozzles, bed adhesives) — add these as materials on the products that use them, or track via the Maintenance system.
Insurance — include this in your overhead allocation.
Financing interest on a purchased machine — either add this to the purchase price or include it in overhead.