Waste-to-Energy Equipment worked example

Warranty Reserve at 22% expected claim occurrence rate: a worked example in waste-to-energy equipment

Suppose expected claim occurrence rate falls to 22%. This page works the full calculation at that level so you can see exactly which result moves and by how much. Estimates a warranty reserve for delivered waste-to-energy equipment from the fleet under warranty, expected claim cost per unit, and the rate at which claims occur.

The inputs for this scenario

  • Units under warranty: 18 units (held at the documented default)
  • Expected claim cost per unit: 24,000 $/unit (held at the documented default)
  • Expected claim occurrence rate: 22 % (the input this scenario stresses; the baseline uses 30)
  • Fixed reserve administration floor: 15,000 $ (held at the documented default)

Working through the calculation

  • The calculation starts from the formula this tool documents: Reserve = units x expected claim per unit x occurrence rate % + admin floor.
  • Total warranty reserve cost works out to 110,040 $ at these inputs, and this is the headline figure for the scenario.
  • Warranty reserve cost per unit works out to 6,113 $ / piece at these inputs.
  • Variable warranty reserve cost works out to 95,040 $ at these inputs.
  • Fixed warranty reserve adder works out to 15,000 $ at these inputs.

How this compares with the baseline

  • Against the tool's baseline example, where expected claim occurrence rate sits at 30% and the headline result is 144,600 $, this scenario comes in 23.9% below the baseline at 110,040 $.
  • It computes the total warranty reserve and the reserve per unit from units, expected claim cost, an occurrence rate, and a fixed admin floor. When the numbers land here, the stressed input is the lever to work; the walkthrough above shows exactly how much each output recovers as it climbs back toward the baseline.

Results at a glance

  • Total warranty reserve cost: 110,040 $ (headline result)
  • Warranty reserve cost per unit: 6,113 $ / piece
  • Variable warranty reserve cost: 95,040 $
  • Fixed warranty reserve adder: 15,000 $

Run it with your numbers

  • To rerun this with your own numbers, open the live Warranty Reserve calculator, set expected claim occurrence rate to your actual value, and adjust the remaining inputs to match your operation.

Last reviewed 2026-05-12.