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How do you eat an elephant_final
- 1. How Do YouEat an Elephant? – Gaining Ground on Your Aging Utility Infrastructure Southwest Ohio Water Environment Association June 4, 2015
- 2. • State ofPublic Assets • Current Challenges and Risks • Overview of Asset Management • Simple Steps to Get You Out of the Gate • Group Discussion • Takeaways and Q&A Agenda Brown and Caldwell 2
- 3. State of PublicAssets
- 5. http://infrastructurereportcard.org Brown and Caldwell| West Region CSM Program 5
- 6. A Global Legacyof Inefficient Under-Investment Brown and Caldwell | West Region CSM Program 6
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- 10. What Does AllThis Mean? • O&M demands are rising due to conditions • Capital dollars are harder to find /valued less • Revenues declining • Dollars are stretched for Public Utilities • Competing with General Fund interests • Perpetual scrutiny for funding requests • Demanding Data Driven Decisions • Need for Reinvestment • But hesitancy for Rate Increases
- 11. What’s at Stake? •Dramatic Effect on Economic Competitiveness • We’re nothing without a solid foundation. • Infrastructure is Connective Tissue of our Nation • Freight ports, airports, bridges, roads, rail and transit, water and sewer systems, communications • Smart Policies and Investments • Enhance national prosperity • Bolster health and vitality of our communities • Provide job and career opportunities into the future
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- 14. Quick Poll • FullBlown Asset Management? • Vertical, Horizontal, Both • KPIs / Performance Measures? • CMMS? • Reliability Centered Maintenance? • CMOM?
- 15. • Regulatory requirements •Aging infrastructure and renewal requirements • Growth / increasing demand • Political / public influences and pressures • Requirements to justify infrastructure investments • Retiring workforce / “brain drain” • Drive to accomplish more with less Common Drivers for Asset Management Brown and Caldwell 15
- 16. AM Reference Documents Brownand Caldwell 16 International Infrastructure Management Manual WERF/WRF Condition Assessment GuidelinesISO 55000
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- 18. Asset Management isa structured program to deliver defined service levels at an acceptable risk at the least life-cycle cost of asset ownership. What is Asset Management? Brown and Caldwell 18 Spend the right amount of money, On the right things, At the right time.
- 19. Know where yourassets are • Mapping / GIS Manage Maintenance • PM / CMMS Understand the condition of assets • CCTV / Vibration / CMMS Evaluate LOS & Risk • COF / LOF Understand cost of ownership • O&M costs • R&R cost • Funding options and planning What is Asset Management? Brown and Caldwell 19
- 20. Asset Management Program Components •Do we have management support and direction, adequate resources and staff buy-in to develop and sustain the AM program? Program Direction & Resources • What are the expectations of our stakeholders (public, regulators)?Level of Service • What do we own and where is it? • What condition is it in? How is it likely to fail? Asset Knowledge • When should it be rehabbed & replaced and how much will it cost? • When and where will we need new assets and how much will it cost? Asset Planning • What is most likely to fail and has the highest consequence if it fails?Critical Assets • How do we operate and maintain it to deliver service levels at the lowest life cycle cost?O&M Strategy • How should we spend capital resources to deliver service levels at the lowest life cycle cost?CIP Strategy • How do we provide funding to deliver service levels at the lowest life cycle cost? Long-term Funding Strategy Monitor&Measure ITSystems&Tools
- 21. Common AM Terms •Expected Useful Life (EUL) • Availability and Reliability • Life Cycle Costs • Risk • Likelihood of Failure (LOF) • Consequence of Failure (COF) • Redundancy • Maintenance Strategy • Corrective • Preventive • Predictive • Replacement Strategy • Run to Failure • Time Based • Condition Based Replacement Asset Management Terms Brown and Caldwell 21 Time Limit of Acceptable Performance Failure State PerformanceLevel Asset Performance with Time A B C
- 22. Capital costs areonly part of the picture
- 23. Overall Life CycleCosts Brown and Caldwell 23 Asset Life Cycle Cost Profile Acquisition Maintenance Disposal Life of Assets (Years) $ Refurbishment Refurbishment Replacement Life Cycle Cost is the total lifetime cost to procure, install, operate, maintain and dispose of an asset needed to maintain the intended function, or total cost of asset ownership.
- 24. Risk-Based Approach enablesPrioritization Brown and Caldwell 24 Strategy: Plan for asset renewal and/or risk mitigation Criteria - • Age • Material • History • Depth • Size • Location Low Likelihood of Asset Failure Consequences of Asset Failure High LOW RISK ZONE MEDIUM RISK ZONE HIGH RISK ZONE
- 25. Managing Risk Brown andCaldwell 25 Consequence of Failure H M L
- 26. Rehabilitation, Repair, ReplacementStrategy Brown and Caldwell | West Region CSM Program 26 Run To Failure Vs. Time Based Consequences of Failure Economic Based Strategy Operate to Failure Strategy Time Based StrategyLikelihoodofFailure Condition Monitoring Based Strategy
- 27. Everyday Replacement Strategies Brownand Caldwell 27 Run to Failure Condition Based Replacement
- 28. Everyday Replacement Strategies Brownand Caldwell 28
- 29. Parkwood Lift Station Brownand Caldwell 29 Plus, 24 backwater valves
- 30. Simple Steps toGet Out of the Gate
- 31. Asset Management Program Components •Do we have management support and direction, adequate resources and staff buy-in to develop and sustain the AM program? Program Direction & Resources • What are the expectations of our stakeholders (public, regulators)?Level of Service • What do we own and where is it? • What condition is it in? How is it likely to fail? Asset Knowledge • When should it be rehabbed & replaced and how much will it cost? • When and where will we need new assets and how much will it cost? Asset Planning • What is most likely to fail and has the highest consequence if it fails?Critical Assets • How do we operate and maintain it to deliver service levels at the lowest life cycle cost?O&M Strategy • How should we spend capital resources to deliver service levels at the lowest life cycle cost?CIP Strategy • How do we provide funding to deliver service levels at the lowest life cycle cost? Long-term Funding Strategy Monitor&Measure ITSystems&Tools
- 32. What Services doyou Provide? Who uses your services? What is important to your Customers? Needs? Expectations? What are the measures that define good service? What do you do to provide your service? What kind of information about your activities do you need to run your business? What are the activity metrics for good performance? Customer Level of Service Key Performance Indicators Your Customers Alignment Customer/Utility Your Activities Level of Service Analysis Yields Key Performance Indicators
- 33. Assess the CurrentState of Affairs The Asset Management Program Evaluation (AMPE) Process
- 34. • Tools, notthe program • Optimize an AM Program GIS and Computerized Maintenance Management System (CMMS) Brown and Caldwell 34 Easy Access to Data
- 35. “The pipes wereso old they had to break some time.” Predicting Failures – Condition Assessment Brown and Caldwell 35
- 36. • “If itain’t broke, don’t fix it” • But you have to maintain some things Proactive Maintenance Program Brown and Caldwell 36
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- 38. Literal: Continuous improvementdocument • Describes how assets are managed • What is the current state of my assets? • What is my required level of service? • Which assets are critical to sustained performance? • What are my best O&M and CIP investment strategies? • What is my best long-term funding strategy? Functional: The collection of business processes that are used to manage assets on a daily and long-term basis Development of an Strategic Asset Management Plan From Aquamark
- 39. The Develop aFunding Analysis Tool 39 Input Information Output R&R costs by year Useful lives Asset inventory Years in service Replacement costs Refurbishment needs Annual contributions Earnings rate Inflation rate Fund Balances RP Tool
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- 41. • Subject IsTOO important to ignore! • Asset Management is your friend (regardless of your employment classification)! • Use reference docs and existing programs while developing (plagiarism = flattery)! • The hardest part is getting started! Takeaways
- 42. • Customize it…accordingto your system, demands, resources, availability! • Involve and engage “figure heads” throughout the process (so you can leverage)! • It’s time to sharpen those pencils and determine the best use of your limited budget! Takeaways (2)
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