SunWater Asset Management SunWater & It s Asset Management Strategies 1
INTRODUCTION TO SUNWATER Bevan Faulkner Director, Asset Management 2
Introduction to SunWater What is SunWater? Where did SunWater come from? Why was SunWater created? What is SunWater s core business? SunWater s structure 3
Introduction to SunWater What is SunWater? Government Owned Corporation (GOC) Commenced operation 1 October 2000 Two shareholding Ministers Government appointed board of management 4
Introduction to SunWater SunWater s structure Shareholding Ministers 1. Stephen Robertson 2. Terry Mackenroth Board of directors 1. Andrew Greenwood 2. Jane Bertlesen 3. Julie Boyd 4. Helen Doherty 5. Richard Haire 6. Phil Hennessey 7. Henry Prokuda 5
Introduction to SunWater Where did SunWater come from? 1947 1979: Irrigation & Water Supply Commission 1979 1987: Qld Water Resources Commission 1987 1989: Water Resources Commission 1990 1995: DPI Water Resources 1995 1996: DPI Water Commercial 1996 2000: DNR State Water Projects 2000 -?????: SunWater 6
Introduction to SunWater Why was SunWater Created? Hilmer Report National Competition Policy COAG Water Resources Policy Reform of the water industry in Qld Water Reform Unit Water Act 2000 (Qld) 7
Introduction to SunWater COAG Water Resources Policy Secure provision of water for the environment Clearer specification of water entitlements for users The adoption of transfer arrangements for water Opportunity for greater private sector involvement in the water industry Institutional arrangements that separate the role of water supply and regulation Greater public consultation and participation in water arrangements 8
Introduction to SunWater Water Act 2000 (Qld) Assented 13 September 2000 Three Main Objectives: 1. Sustainable management framework for the planning, allocation and use of water and other resources 2. Regulatory framework for service providers covering asset management, customer standards and dam safety 3. Governance regime for statutory authorities that provide water services 9
Introduction to SunWater What is SunWater s core business? Bulk water storage & distribution Retail water reticulation & drainage Water infrastructure development Engineering consultancy services Operation & maintenance services Water business management services 10
2. SunWater Infrastructure Perry Finn Principal Advisor, Asset Management 11
2. Sunwater Infrastructure Overview (2000): Assets: $2.5Bn AUD (replacement cost) Operating expenses: $90M AUD per year Water Supply Schemes: 28 Storage capacity: 6,670,000 ML Number of users: 7,025 Water allocation: 2,172,000 ML Water delivered (1999/2000): 1,537,587 ML Area irrigated: 341,500 Ha 12
2. Sunwater Infrastructure Infrastructure Summary Dams: 25 (6,314,000 ML Capacity) Weirs & barrages: 81 (356,500 ML) Pump stations: 69 Industrial pipelines: 263 km Channels & pipelines: 2,072 km Drains: 740 km External Clients Border Rivers, SEQ Dams, Scrivener Dam, NPA Water Supply 13
SUNWATER SCHEMES 14
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History of SunWater Asset Management 1990: Need for management system ARMS (Asset Register & Management System) The first asset register (in-house, state of art) 1991-95: Non-compulsory implementation 1995: Accrual accounting Asset Identification Asset valuation (deprival) Bill of materials = qty * unit rate + Indirects Audit Jul 2000: SAP PM Implementation 16
The Lessons of ARMS: Not an integrated system ARMS Work Orders & Job Estimation QGFMS Actual costs, not accounted against asset Duplication of cost data entry Maintenance history variable Not a standard system Multiple databases Data not standard 17
The Success of SAP PM An integrated system Work management & job costing Single system Improve data standards Powerful work management tools 18
Problems with transition from ARMS to SAP PM: Initial implementation financial & work management focused Little attention paid to cleansing asset data Forcing ARMS data to fit SAP PM Loss of functionality accustomed to in ARMS User resistance to change (greater complexity) Incomplete configuration of SAP PM 19
SunWater Key Corporate Information & Management Systems: Financial System (SAP) SunWater Information Management System (SWIMS) Asset Management Systems SAP PM Work Orders & Maintenance History Condition & Renewals O&M Manuals (Optimised Maintenance Strategies) Drawing Documentation 20
Why SunWater Undertakes Asset Management? To manage internal activities to reflect external responsibilities To manage the internal purchaser (WSS) /provider (O&M) split (Service Level Agreement - SLA) To manage corporate risk To provide cash flow projections for business modeling & financial management To manage compliance responsibilities To improve asset lifecycle management 21
The Asset Management Process Overview 1. Asset Identification & Valuation 2. Strategic Planning 3. Asset Condition & Criticality 4. Detailed Risk Assessment 5. Asset Renewal Planning 6. Maintenance Engineering 7. Work Management 8. Operations And Maintenance Manuals 9. Asset Management Plans 22
1. Asset Identification & Valuation Financial assets reconciled (NCAL to SAP-PM) Add non-financial technical assets under hierarchy in SAP PM for maintenance management 30,000 financial assets 45,000 financial + maintenance assets Project costs captured in AUC under accrual accounting (require process to assign costs to assets) 23
2. Strategic Planning Produce Scheme Strategic Plan Includes customer service standards Required levels of equipment reliability, time to repair, shutdown allowances etc Information required for detailed assessments i.e. business centred maintenance 24
3. Asset Condition & Criticality Undertaken in conjunction with field staff Asset condition and criticality rating Objective remaining life assessment (key input to renewals) Ground truth asset register Collect photographic records Undertake maintenance assessment Collect location information (GPS) Develop geographic information system (GIS) Prioritise budget spending 25
EXAMPLE CONDITION ASSESSMENT CRITERIA SHEET 26
3. Asset Condition & Criticality GIS Development Relatively new innovation in SunWater Different needs compared to Local Authorities Majority of assets visible or easily located Driven by need to reconcile to asset system, and develop clear understanding of the physical asset/system link Developed from existing base plans, infrastructure centrelines & calculated chainages Cost effective to ground truth desktop GIS during condition assessment field work 27
4. Detailed Risk Assessment Condition & Criticality assessment (initial asset based risk) Workshop undertaken with key staff High corporate risk assets (industrial pipelines, major pumpstations & headworks) Risk identification & analysis (system based risk) Risk treatment including contingency plans, spare parts, modifications, insurance 28
4. Risk Assessment Process Failure Modes & Effects Analysis (FMEA) Risk = Probability of failure * Consequence Consequence Criteria: Loss of function (F) Cost to SunWater (C ) Safety (Potential for injury or death)(s) Environmental Impact (E) Risk = (F+C+S+E) * Pr 29
4. Asset Renewal Planning (No Surprises) Developed from O&M advice (workshops), maintenance history, condition & risk assessments Best guess forward look program of replacement & non-routine maintenance Expenditure profile Required for corporate planning (water prices, regulator, financial planning) Renewals annuity (SCARM) 30
Example Irrigation Area EXAMPLE RENEWALS EXPENDITURE FORECAST 31
6. Maintenance Engineering Assessment Maintenance strategies developed in consultation with O&M (task & frequency) Technical review of current practices and future needs Takes into account condition, criticality and risk profile of assets Derived from standard set of maintenance strategies developed for asset types Includes spare parts analysis 32
7. Work Management (O&M) Prepared by O&M in consultation with Asset Management Prepared using O&M work management process Incorporates all the requirements of the O&M Manual Service Specification details how these requirements are to be addressed SAP PM work plans (resources & planning) O&M work instructions 33
8. Operations And Maintenance Manual Developed from current O&M practices and other information sources Targeted at the operators use of graphics Includes maintenance strategies from OMS Includes risk treatments from risk study To be incorporated into Service Level Agreement (SLA) 34
9. Asset Management Plans Details services provided Specifies infrastructure Defines standards & performance measures Outlines operations, maintenance and renewals strategies Compliance with the provisions of the Water Act 2000 (Qld) 35
Other Asset Management Functions 1. Dam safety 2. Custodian of drawing information (drawing information system) 3. Custodian of asset documentation & data 4. Define corporate asset management policies & standards 36
Dam Safety 3. Asset Management 1. Compliance with Water Act 2000 (Qld), guidelines & directions from regulator 2. Dam safety monitoring storage incident and instrumentation reporting & analysis 3. EAPs, SOPs, O&M Manuals (data book) 4. Annual dam safety inspections 5. 5yr dam safety inspections (condition assessment) 6. 20yr dam safety reviews 37
Information Management Drawings Drawing Information System (DIS) 150,000 drawings Documentation asset management library future scanning & on-line availability Data not compatible with current corporate systems renewals, condition & criticality meta-data, photos etc 38
4. FUTURE DIRECTION Cethana Dam Spillway Model Rocklea Laboratory 39
4. Future Direction Continue implementing & improving the Asset Management Process Complete condition & criticality assessment process as a priority Complete dam safety review program Review renewals annually as part of budget and work planning cycle Improvements to the configuration of SAP PM Documentation: Document policies and procedures Drawings on-line complete 2001 Complete O&M manuals (incl. Dams) Undertake detailed risk assessments of key assets 40