Thin Client/Application Servers (TCAS) save if you are runnng three or more workstations.  If you are running thirty, the savings are huge.

1. A big savings is in management time.   System, application and security software has to be installed only once.
   
   
2. Another savings is in purchase costs.  Thin Clients cost about $300 and a modern XP workstation of similar capabilities costs twice that, or far more.
   
   
3. Depreciation decreases as there is less to depreciate and thin client workstations last longer.
   
   
4. MTTR, mean time to repair, for a workstation decreases massively as with TCAS you can carry a new client in to where a failed one is and replace it in ten minutes.  Compare that to repair or replacement of an XP workstation.
   
   
5. Reliability goes up.  TCAS workstations have less to break, less sotware, less hardware.  For example there is no hard drive to fail for a TCAS workstation.  Less heat generation means a much longer MTBF, mean time before failure.
   
   

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   The following items decrease cost indirectly, through better security hence less downtime and data loss from infections.

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6. 
   Security goes up: workstations.  There is nothing to infect.  There is nothing to place a worm into for account information stealing.
   
   
7. Security goes up: servers.  The installation and configuration of information security programs can be done once, carefully, for all workstations and know for certain that there will be no failures on workstations.
   
   
8. Security goes up: Linux servers.  If you are using a Linux LTSP package you have access to far better security programs than are generally used on Windows servers or workstations.  Linux/UNIX operating systems have been worrying about and working on internet security since the Morris worm, 1986.  Windows has been worrying about it since 2003 and Norton's failure prone packages since 1994 or so.
   
   That is why almost all firewalls, DSL modems, and turnkey security devices are based upon Linux.