UTILITIES DEPARTMENT ASSET MANAGEMENT

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UTILITIES DEPARTMENT ASSET MANAGEMENT

  1. 1. UTILITIES DEPARTMENT ASSET MANAGEMENT January 23, 2008 Presentation to Department Quarterly
  2. 2. Outline  What is Asset Management  Why are we investing in Asset Management  Overview of Core Processes & Practices  Examples and Updates from Santa Rosa’s Asset Management  Where to go next
  3. 3. What is Asset Management PM CIP Finance Work Planning Orders Inspection Analysis BCE Asset Management
  4. 4. What is Asset Management Set of Management Practices Not a software package
  5. 5. Why Asset Management?  Whatwork should my operations and maintenance crews be doing, where, and why?  Which capital projects to undertake, when, and why?  When to repair, when to refurbish, and when to replace?  To give the ratepayer the best value
  6. 6. COST Life-Cycle Cost Cumulative Cost Over Asset Life Disposal & Replacement Create Renew O&M O&M % EFFECTIVE LIFE
  7. 7. What is the current state of my assets? Determine Inventory Assess Determine Set Target Replacement Assets Condition Residual Life LOS $ & Date Assign BRE Determine Determine Identify Rating Appropriate Appropriate Funding (Criticality) Maintenance CIP Strategy What do I own? Asset registry/inventory Where is it? Data standards / asset hierarchy What condition is it in? System maps What is its remaining useful life? Process diagrams What is its economic value? "Handover" procedures Condition analysis Condition rating Valuation techniques Optimized renewal / replacement cost tables
  8. 8. Section Assets Local Wastewater 38,407 Local Water 96,028 LTP 2,877 Reclamation 1,181 Biosolids 397 Geysers 2,570 TOTAL 141,460
  9. 9. Coordination/Communication with Finance Depreciation Methods and uses of Financial Data
  10. 10. PIPE MILES PIPE MILES -2 0 10 20 30 40 0 20 40 60 80 100 120 140 0 -2 2007 007 2 2009 009 2 2012 012 2015 2015 2019 2019 2022 2022 2025 2025 PVC ACP CCP 2028 2028 HDPE PVC26 2031 2031 2034 2034 2037 203 7 2040 204 0 ABS 2043 204 SLPL 3 DUCT POLYE 2046 204 6 VCP ACP PVC CCP 2049 20 5 49 PVC26 20 2 20 5 2055 20 2 5 2058 2 5 05 TRUSS NOINFO 2061 2 8 CONCYL 06 2064 2 1 VCP 0 SLPL POLYE 2067 2 64 0 2070 67 20 CIP YEAR & PIPETYPE CIP YEAR & PIPETYPE ABS RCP LCIP HDPE LPVC DUCT CAST 2073 70 2 CONC 2076 073 2 2079 076 2 LPVC 2082 079 2 TRUSS NOINFO CONCYL 2085 082 8 20 8 2085 2091 2088 2094 2091 RCP LCIP 2197 2094 CAST CONC 2100 2097 2103 2100 06 2 10 3 21 06
  11. 11. What is my required sustained Level of Service? Determine Inventory Assess Determine Set Target Replacement Assets Condition Residual Life LOS $ & Date Assign BRE Determine Determine Identify Rating Appropriate Appropriate Funding (Criticality) Maintenance CIP Strategy Customer demand analysis What is the demand for my services Regulatory requirements analysis from my stakeholders? Level of service statements; LOS "roll-up" What do regulators require? hierarchy What is my actual performance? "Balanced scorecard" Asset functionality statements AM Charter
  12. 12. Which of my assets are critical for sustained performance? Determine Inventory Assess Determine Set Target Replacement Assets Condition Residual Life LOS $ & Date Assign BRE Determine Determine Identify Rating Appropriate Appropriate Funding (Criticality) Maintenance CIP Strategy Failure analysis Risk / consequence analysis How do my assets fail? How can they fail? Asset list by criticality code What is the likelihood of failure? Failure codes What does it cost to repair? Probability of failure What are the consequences of failure? Business risk exposure Asset functionality statements Asset "decay curves" Asset unit-level management plans and guidelines Asset knowledge
  13. 13. Triple Bottom Line
  14. 14. What are my best minimum lifecycle cost CIP and O&M strategies? Determine Inventory Assess Determine Set Target Replacement Assets Condition Residual Life LOS $ & Date Assign BRE Determine Determine Identify Rating Appropriate Appropriate Funding (Criticality) Maintenance CIP Strategy Optimized renewal decision making What alternative management Life-cycle costing options are there? CIP development and validation Which are most feasible for my Condition-based monitoring plans and organization? deployment Failure response plans Capital "cost compression" strategies Operating "cost compression" strategies
  15. 15. What is my best long-term funding strategy? Determine Inventory Assess Determine Set Target Replacement Assets Condition Residual Life LOS $ & Date Assign BRE Determine Determine Identify Rating Appropriate Appropriate Funding (Criticality) Maintenance CIP Strategy What alternative management options are there? Which are most feasible for my organization? Over-arching financial impact analysis Optimized financial strategy Total Asset Management Plan Telling the story with confidence
  16. 16. Current Issues  Practice vs Policies  Reliance on interest level  level service/expectations  Unknown Consequences  Lack of Structure  Duplicate Data Requests/Responses  Citywide coordination  Sharing of resources/knowledge between sections  Citywide impacts
  17. 17. What's Next  Develop Department Wide Asset Management Structure  Personnel  Responsibilities  Point of contacts  Organize a Regular Asset Management Coordination Meeting  Representatives from each section  Scheduled “examples of what works”  Focus on Geysers lessons learned over the next 3 months  Develop Department Wide Asset Management Policies  Assist old and new managers on accepted practices and procedures  Play an active role in Citywide & Industry efforts
  18. 18. Questions / Discussion

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