WASTEWATER ASSET MANAGEMENT PLAN

Transcription

1 WASTEWATER ASSET MANAGEMENT PLAN Hauraki District Council DRAFT 2015 AMP FRED _v6

2 Asset Management Plan Control Sheet 1.PROJECT MANAGER: Nathan Shaw 2. PLAN PREPARED / REVIEWED / UPDATED BY: DATE NAME DESIGNATION Oct 2014 N Shaw Asset Management Oct 2014 K Thompson District Engineer Oct 2014 M Charteris Utilities Manager 3. COUNCIL CONSIDERATION / ADOPTION: WASTEWATER ASSET MANAGEMENT PLAN DATE MINUTE NO./ ACTION REASON / ACTION / DECISION Nov 2014 Updated AMP & Exec Summary adopted Completion of review Wastewater Asset Management Plan Nov PUBLIC CONSULTATION (RELATING TO THE WHOLE PLAN ITSELF): DATE FORM OF Ongoing Water & Waste Consultative Committee In process LTP Consultation & Submission Process 5. PLAN UPDATE AND REVIEW BY MANAGEMENT: DATE RECORD OF July

3 TABLE OF CONTENTS 1 INTRODUCTION WASTEWATER ACTIVITY GOALS & OBJECTIVES OBJECTIVES OF THE WASTEWATER ASSET MANAGEMENT PLAN COMMUNITY OUTCOMES STRATEGIC AND LEGISLATIVE FRAMEWORK ASSET MANAGEMENT PLANNING POLICY LEVEL OF ASSET MANAGEMENT PRACTICE LEVELS OF SERVICE INTRODUCTION WHAT IS IMPORTANT TO THE COMMUNITY CUSTOMER LEVELS OF SERVICE AND TECHNICAL LEVELS OF SERVICE CUSTOMER LEVELS OF SERVICE TECHNICAL PERFORMANCE TARGETS SERVICE REQUEST PRIORITISATION ANNUAL RESIDENT SURVEY LEVELS OF SERVICE CONSULTATION COMMUNITY CONSULTATION WATER AND WASTE CONSULTATIVE COMMITTEE REVISION OF LEVELS OF SERVICE FOR DESCRIPTION OF ASSETS OVERVIEW INDIVIDUAL SCHEMES WITHIN THE DISTRICT WASTEWATER NETWORK ASSET DESCRIPTION WASTEWATER TREATMENT ASSET DESCRIPTION ASSET REGISTERS FINANCIAL DESCRIPTION DEMAND AND GROWTH FUTURE DEMAND DEMAND MANAGEMENT POPULATION PROJECTIONS HISTORIC POPULATION NUMBERS FUTURE POPULATION FORECASTS RISK MANAGEMENT FOCUS ON CRITICAL ASSETS RESIDUAL RISK RISK MANAGEMENT STRATEGIES EMERGENCY FAILURES CATASTROPHIC EVENTS RISK MANAGEMENT AT CORPORATE & SERVICE LEVEL LEGISLATIVE REQUIREMENTS FOR RISK MANAGEMENT INTEGRATION WITH MAINTENANCE & REPLACEMENT STRATEGIES Risk Register LIFECYCLE MANAGEMENT INTRODUCTION: THE OBJECTIVES OF LIFECYCLE MANAGEMENT LIFECYCLE MANAGEMENT STRATEGY RISK MITIGATION VS ASSET CRITICALITY MANAGING RISK July

4 9.4 EXPECTED LIVES THE RENEWALS MODEL OPERATIONS AND MAINTENANCE ASSET CONDITION AND PERFORMANCE MONITORING RENEWAL CREATION AND ACQUISITION STRATEGIC PRIORITIES STRATEGIC PRIORITIES PAST 3-YEARS STRATEGIC PRIORITIES NEXT 3-YEARS KEY PROJECTS KEY PROJECTS PAST 3-YEARS KEY PROJECTS NEXT 3-YEARS FINANCIAL FORECASTS & MANAGEMENT LINKAGE BETWEEN THE FINANCIAL PLAN AND COMMUNITY OUTCOMES FEES AND CHARGES DETAILED 10 YEAR FINANCIAL PLAN OPERATIONS & MAINTENANCE EXPENDITURE NEW CAPITAL EXPENDITURE RENEWAL CAPITAL EXPENDITURE DEPRECIATION ANNUAL DEPRECIATION FOR NEXT 10 YEARS DEPRECIATION POLICY ASSET USEFUL LIVES & UNIT RATES LEGISLATION AND BYLAWS RELEVANT STRATEGIES AND PLANS PLANNING ASSUMPTIONS AND CONFIDENCE LEVELS SIGNIFICANT ASSUMPTIONS AND POSSIBLE EFFECTS DATA CONFIDENCE CONFIDENCE LEVELS ON ASSET CONDITION & PERFORMANCE Accuracy of Asset Inventory Confidence Level on Demand/Growth & Financial Forecasts EFFECTS OF THE WASTEWATER SERVICE ENVIRONMENTAL EFFECTS SUSTAINABILITY RESOURCE CONSENTS IMPROVEMENT PROGRAMME IMPROVEMENT PROGRAM PROGRESS WITH IMPROVEMENT PLAN COUNCIL Commitment SCHEDULE OF APPENDICES A: Rural Wastewater Service Zone July

5 Paeroa Treatment Plant Aerator July

6 1 INTRODUCTION The public waste water network collects waste water within the urban boundaries of seven townships in the Hauraki District. Approximately 8,000 people within the District have their house connected to the wastewater service. The key reasons for providing a service for the treatment and disposal of wastewater are to protect public health; to mitigate the risks of pollution and disease associated with wastewater; and to protect the receiving environments from the effects of wastewater products and by-products. Seven schemes in the District are operated by the Council. Each scheme has its own wastewater treatment plant (Table 1.1) and wastewater from approximately 6,050 properties is received at the plants via a total of160 km of pipes. Fifty wastewater pump stations within the network lift the wastewater to a higher elevation to enable it to continue its journey towards the treatment plant. The public waste water treatment service is provided in towns of: Ngatea, Kerepehi, Turua, Paeroa, Waihi, and Whiritoa. Rural townships that must provide their own private wastewater treatment facilities within the district are: Mackaytown, Karangahake, and Waikino. The small population and remoteness of these small townships renders a public wastewater service to these communities uneconomic. However, the lack of population pressure on the density of housing in these communities also means that private lot sizes are large in these townships, with sufficient area for the disposal of the effluent to soil. These areas also have well-draining soils. The small rural township of Waitakaruru is the exception within the district. A public wastewater service is provided to this community because the high groundwater table in the area prevents normal disposal to the ground of septic tank effluent. Rural households within the district dispose of their wastewater by private means usually septic tanks. In November 2010 the Kaiaua area was incorporated into the Hauraki district. No public wastewater systems were transferred to HDC. All current waste water systems in the area are privately owned and operated. Apart from the public waste water systems approximately 9,700 people on 4,500 properties operate their own private wastewater treatment facilities. Table 1.1: Wastewater Treatment Plants and the associated receiving body for treated wastewater (Listed West to East) WASTEWATER TREATMENT PLANT Waitakaruru RECEIVING BODY Maukoro Canal Ngatea Piako River. Kerepehi Awaiti Canal. Turua Waihou River. Paeroa Waihou River. Waihi Ohinemuri River Whiritoa Irrigation onto an 8 ha eucalyptus plantation July

7 1.1 WASTEWATER ACTIVITY GOALS & OBJECTIVES Legislation requires Council to identify the need for public wastewater treatment services. Council may provide the wastewater treatment service itself, as is currently being done, or maintain an overview of supply provided by others. In respect of meeting the wastewater disposal needs of the community, the Council s wastewater service strategic goals are: To provide a reticulated wastewater network connection and treatment facility to residential, commercial, and industrial properties within town urban limits; To provide a rural wastewater treatment service to properties within the rural wastewater service area in Waitakaruru (Appendix A); To operate the wastewater network and treatment plants in a manner that is sensitive to the natural environment; To encourage efficient use of potable water and thereby minimise the volume of wastewater that must be treated. The map in Figure 1.1 shows the location of the wastewater systems in the Hauraki district. Figure 1.1: Hauraki Wastewater Systems WAITAKARURU TURUA WHIRITOA NGATEA KEREPEHI WAIHI PAEROA July

8 1.2 OBJECTIVES OF THE WASTEWATER ASSET MANAGEMENT PLAN The objectives of this Asset Management Plan are: To demonstrate that our asset management strategies are carried out at an appropriate level for the Hauraki community; To outline how Council will meet its legal and regulatory obligations both as a local District Council and as operator of the public wastewater network; To ensure that the volume of wastewater is managed in a cost-effective and sustainable manner; To ensure and demonstrate that the Council has applied a long-term view in respect of environmental and financial sustainability; To provide substantiated financial forecasts and projections demonstrating financial stewardship of the wastewater assets that Hauraki District Council manages on behalf of the community; To promote and carry out a continuous improvement process that identifies both needs and opportunities for improvements in the management and operation of the wastewater activity. July

9 2 COMMUNITY OUTCOMES As required by the Local Government Act 2002, Council has carried out a process to identify community outcomes by giving the community the opportunity to discuss what they think is important in terms of the present and future social, economic, environmental and cultural wellbeing of their community. The community identified the following six community outcomes: PREPARED HAURAKI: We provide a range of services and facilities to meet our District's needs and expectations for a safe environment; INTERACTIVE HAURAKI: We are a proactive Council that provides leadership and communicates effectively with all sectors of our District; KOTAHITANGA HAURAKI: We take a collaborative approach with both Mana Whenua and Tangata Whenua in our District; LIFESTYLE HAURAKI: We provide an environment that encourages vibrant communities and an enhanced quality of life; PROGRESS HAURAKI: We have a positive climate that encourages balanced and sustained economic growth throughout our District; SUSTAINABLE HAURAKI: We plan for the wise use and management of all land and resources for the continued benefit of our District. The Community Outcomes are the high level statement of what Council wants to achieve for the community in the future. Therefore the Community Outcomes can also be interpreted as the Council s Vision for the District. The Council Community Outcomes and the how Wastewater activity contributes are provided in the table page-over: July

10 Table 2.1: Council Community Outcomes and how the Wastewater Service Contributes COUNCIL COMMUNITY OUTCOMES PREPARED HAURAKI We provide a range of services and facilities to meet our District's needs and expectations for a safe environment. KOTAHITANGA HAURAKI We take a collaborative approach with both Mana Whenua and Tangata Whenua in our District. LIFESTYLE HAURAKI We provide an environment that encourages vibrant communities and an enhanced quality of life. PROGRESS HAURAKI We have a positive climate that encourages balanced and sustained economic growth throughout our District. STRATEGIC OUTCOME Safe disposal of wastewater generated in the urban environment. The wastewater network is operated in a manner that is sensitive to the natural environment. A significant reduction in the risk of waterborne diseases spreading throughout the community. Higher densities are possible within the urban environment than could otherwise be achieved through the use of private wastewater systems. To free residents and businesses from the higher costs and time required to maintain private wastewater treatment systems. HOW THE WASTEWATER ACTIVITY CONTRIBUTES Wastewater is collected from properties within town urban limits and treated before being discharged back into the environment as clean, safe, water. By ensuring that cultural values are taken into account in the management of the wastewater network, and disposal of treated waste water back to the environment. The public wastewater network takes responsibility of the safe treatment of wastewater out of the hands of lay people, and places it in the hands of professionals. The centralised nature of the public service makes monitoring significantly easier for regulatory authorities. The removal of wastewater from private properties means that space no longer needs to be allocated within private property for the purposes of effluent disposal. A public wastewater service requires essentially no maintenance on behalf of private residents and businesses. The cost of a public wastewater network service is significantly lower than the lifetime costs associated with private wastewater treatment and disposal systems. SUSTAINABLE HAURAKI We plan for the wise use and management of all land and resources for the continued benefit of our District. The environment is protected. By ensuring that wastewater treatment plants are operated in line with their consent conditions, Council also ensures that the wastewater is returned to the environment of a high standard that is sensitive to the natural environment; A centralised public wastewater service is easier to monitor than individual private systems. Better monitoring reduces the risks of potential adverse environmental effects. July

11 3 STRATEGIC AND LEGISLATIVE FRAMEWORK Figure 3.1 below illustrates the primary linkages between some of the major council plans, strategies and legislative requirements. It shows how the concept of community wellbeing links to the community outcomes, the Long Term Plan (LTP), legislation and other key strategies and documents. This figure represents an overview of the strategic landscape in which the wastewater service is being operated and developed. The diagram also shows that consultation with and the participation of the community underpin the strategic direction as well as business, tactical and operational planning for council activities. The community participation in general is represented by Council. Hauraki district has created an additional initiative in this regard through the establishment of a Water and Wastes Consultative Committee to liaise and consult with relevant community and stakeholder groups on important issues regarding the water and waste services. The diagram shows where the (and AMP s in general) fits into the strategic and legislative framework for HDC. Figure 3.1: Linkages between strategic concepts, documents, plans and legislative requirements Environmental Cultural Community Wellbeing Economic Social Council Community Outcomes Water & Wastewater Consultative Committee Legislation Bylaws Key Strategies (local, regional, national plans) Long Term Plan AMP s Community Plans Council Policies Political Direction Community Consultation Internal Resources Professional Advice KEY: Legislative Drivers Enablers Planning Drivers July

12 4 ASSET MANAGEMENT PLANNING POLICY The small population of the Hauraki District calls for a fit-for-purpose asset management approach. For comparison, the total population provided with a wastewater service within the district (8,000 people) is fewer than the population of most suburbs in Auckland City. To achieve a fit-for-purpose approach Council had to select an appropriate asset management level for the organisation. The figure below provides a broad framework of the environments considered and analysed to develop the AM policy for the Wastewater Activity in the Hauraki district. Figure 4.1.: Drivers of Asset Management Policy External Environment Internal Environment Customer Environment Waugh Infrastructure Management Ltd, assessed Hauraki s asset management planning requirements on behalf of Council. The following table provides the criteria assessed, the results of the assessment and comments on the rationale for the assessment findings. July

13 Table 4.1: Wastewater - Level of Asset Management, Factor Assessment Results CRITERIA ASSESSMENT COMMENTARY Population Core The initial population risk screen for urban areas, all township populations, and total district population showed that asset management practice should be Core. District Wide Risks Costs and Benefits Legislative Requirements Size, Condition, Complexity of Assets Risks Associated with Failures Organisational Skills and Resources Core Plus Large portion of the rates - More risk Meet minimum Normal Average + Normal Based on the identified district wide risk factors, the suggested level of appropriate asset management practice for Hauraki District Council is Core with some extension of practice around the risk management issues identified. The Water and Wastewater budgets are large and represent higher risks if AM practice is not at an appropriate level. These budgets also allow more scope to develop asset management practice as appropriate. Hauraki District Council policy is to meet minimum legislative requirements, or exceed requirements where deemed appropriate and cost effective through levels of Service Consultation. The asset management response to legislative requirements is a compliance based approach. The size and complexity of assets is normal for a rural authority with small towns. The assets are generally in good condition with the exception of high inflow and infiltration into wastewater reticulation in Waihi and Paeroa due to the poor condition of pipes. Assets are fit for purpose and generally not of unusual size or complexity. Flooding affects portions of the network from time to time and contingency planning is required. Failure of water systems (particularly the plains area) would lead to a range of issues including economic risk, and wastewater system failure has public health and environmental consequences. This suggests a higher level of risk management practice for water and wastewater. Public Health risk management is already legislatively mandated. All activities are affected by funding risks, and any uncertainty around the district economy and funding from third parties should be considered. Hauraki District Council is a small sized local authority. On a population basis, approximately 30% of local council s in New Zealand are smaller than Hauraki District Council. Internal and external resources have been maintained as required to deliver services. Operational knowledge has been retained by the organization. Staff resourcing levels are stable, although there are longer term issues around recruitment and retention of suitable resources. Elected representatives knowledgeable and engaged in community decisions. Identified resource gaps in technical expertise (Water and Wastewater) need to be managed. There is a lack of documented Standard Operating Procedures and Quality Plans. Customer Expectations Average Council considers its approach and ability to deliver asset management in terms of its wider business approach. A regular selfassessment of Council s asset management processes assists to ascertain focus and areas for improvement. The organisational skills and resources applied to achieve the asset management objectives are outlined through Councils LTP, AMPs, Human Resources and Business Plans. Council has developed and maintained assets to a good standard. Maintenance of current service levels is important to the community. Overall customer expectations are judged to be typical of a rural and small communities that are stable but with high expectations of July

14 CRITERIA ASSESSMENT COMMENTARY Sustainability Corporate sustainability policy maintaining and / or restoring service that have economic impacts on rural production and the district economy. Hauraki District Council has a sustainability policy as outlined in the LTP that will be applied to all assets and management. Potential impacts of climate change and sea level rise require a longterm risk management approach Legislative changes currently being considered, and changes to regional and national standards may impact the activity. Final AM Level Core (risk management Core Plus ) Analysis of factors suggests that asset management practice should be Core with a more comprehensive Core Plus approach to risk management. This policy introduces the concept of Core Plus asset management practice. The IIMM 2006 (Section 2.2.4) identifies two levels of asset management practice; core and comprehensive (also referred to as advanced). For many asset owning authorities their desired practice levels, based on their infrastructure drivers will be above core practice (as defined in the IIMM 2006) but may well be below Comprehensive asset management practice. Core Plus asset management practice is above core and below fully compliant with Comprehensive practice. Therefore, each asset owner has had to consider the appropriate asset management level on an activity basis, taking into account national, regional and local drivers of asset management practice for that asset. The Core Plus Asset Management Policy was implemented in July

15 4.1 LEVEL OF ASSET MANAGEMENT PRACTICE Further analysis of wastewater asset management practices and processes performed by Waugh Infrastructure Management Ltd and council staff provided a more detailed framework for the identification and future management of appropriate asset management levels 1. The practices and processes required for the wastewater activity to achieve the identified asset management level are detailed in the table below: Table 4.2: Wastewater Summary - Level of Asset Management Practises Required AM ATTRIBUTE PRACTICES AND PROCESSES REQUIRED Core 1. Levels of Service Reliable Physical inventory: Define LOS or performance Linkage to strategic/community outcomes Links to other planning documents Levels of consultation identified and agreed Service life of network stated 2. Description of assets Process of Development: Adequate Physical Description of Asset Adequate Financial Description of Asset Remaining useful life Ability to Aggregate & Disaggregate Information 3. Managing growth Demand Forecasts (30 year) Demand Management drivers documented Demand Management strategies documented Sustainability Strategies 4. Risk Management Identify critical assets Identify associated risks and risk management strategies for critical assets Identify significant negative effects 5. Lifecycle (Optimised) Decision-making Lifecycle and Asset Management Practices: Service capacity gap analysis Evaluation and ranking based on criteria of options for significant capital invest decisions Maintenance Outcomes, Strategies, Standards and Plans documented Core Plus Physical attributes captured (location, material, age etc) Recognition & application of principles of integrated risk management to assets demonstrated Apply standards & industry good practice (e.g. NZS4360 and Local Government Handbook) Risk Management integrated with other Corporate processes (Lifelines, Disasters Recovery, Continuity Plans) Integrate with maintenance and replacement strategies 1 The result areas are aligned with the document - Criteria for assessing conformity to Core and Advanced levels of Asset Management by the Office of the Auditor General (New Zealand). July

16 AM ATTRIBUTE PRACTICES AND PROCESSES REQUIRED Core 6. Financial Forecasts AM reflected in 30 year Financial Plan Maintenance, Renewals, New Capital (LOS and demand). Validate the Depreciation/Decline in Service Potential 7. Planning Assumptions and Confidence Levels List all assumptions and possible effects Confidence level on asset condition Accuracy of asset inventory Confidence level demand/growth forecasts Confidence level on financial forecasts 8. Sustainability Compliance with LGA 2002 and amendments. Corporate policy in place Sustainability liabilities 9. Outline Improvement Programmes 10. Planning by Qualified Persons Identify improvements to AM processes & techniques Identify weak areas & how they will be addressed Timeframes for improvements Identify resources required (human & financial) Improvement programmes are monitored against KPI s AM Planning should be undertaken by a suitably qualified person 11. Commitment Plan adopted by Council including improvement programme Plan key tool to support LTP AM Plan regularly updated and should reflect progress on improvement plan 12. AMP Format Purpose of the plan Indicates significant changes with previous AMP Strategic asset management functions are detailed Clearly identifies issues associated with the service Indicates AM Programme for the service Indicates AM practices Core Plus List all assumptions including organisations strategic plan that support AM linkages with other planning doc Incorporation of national and regional sustainability policies and plans Process should be Peer Reviewed AM Plan requirements are being implemented and discrepancies formally reported AM Plans evolving as AM systems provide better information AM Plans updated every 3 years along with organisations strategic planning cycles July

17 5 LEVELS OF SERVICE 5.1 INTRODUCTION Levels of service (LoS) define the standard of service delivered to the community, over and above the legislative requirements. LoS represent an agreement between the Council and the Community defining what will and will not be provided by the service. Level of service targets guide the planning, work programmes, infrastructure design and maintenance decisions that Council s engineers and management make (Figure 5.1). The work programmes and maintenance that arise out of the Council s commitment to deliver on the LoS cost money to carry out; and therefore the LoS targets ultimately affect the cost of the wastewater service to customers. Figure 5.1: Levels of Service Guide the Direction of the Wastewater Asset Management Activity The LoS therefore represent an agreement between the Council and Community on what aspects of the wastewater service are important to the community, and what the community is prepared to pay for. 5.2 WHAT IS IMPORTANT TO THE COMMUNITY The following seven aspects of the wastewater service were identified as those of greatest importance to the community: 1. The cost of the wastewater service; 2. That the treated waste water is safe to discharge back into the environment; 3. That the wastewater is unobtrusively carried away from people s houses to the treatment plant; 4. That the community and environment is protected from the risks surrounding the spread of disease and human waste; 5. That the wastewater service is reliable; 6. That the Council is quick to respond to interruptions to the wastewater service if and when they occur; 7. That customer service requests are dealt with promptly and appropriately. July

18 5.3 CUSTOMER LEVELS OF SERVICE AND TECHNICAL LEVELS OF SERVICE Two types of Level of Service have been prepared: i. Customer Levels of Service; and ii. Technical Levels of Service. The customer levels of service are intended for the public; and encapsulate the seven aspects of importance to the community. The Technical Levels of Service are the means by which Council meets its agreement with the community to provide a wastewater service at a stated standard at an agreed cost. They are intended for use by Council management and engineers to help assess at a technical level whether or not the wastewater network is being managed in the manner that will deliver the Customer Levels of Service. The Customer Levels of Service are those that are described in the Hauraki Long Term Planning documents and this executive summary. The Technical Levels of Service are described in the main body of this AMP. 5.4 CUSTOMER LEVELS OF SERVICE The customer levels of service are those that follow through to the Hauraki Long term plan. The levels of service have been revised for the 2015 Asset Management Plan to address the seven aspects of greatest importance to the community listed above. The Customer Performance Measures are developed to enable the customers of the service and the wider community, to understand the targets and measurement of the Levels of Service with ease. Four Levels of Service are used to monitor whether the aspects important to the community (Section 5.2) are being met, refer Table 5.1, page over: July

19 Table 5.1: Customer Levels of Service, Performance Indicator & Targets LEVEL OF SERVICE OBJECTIVE COMMUNITY VALUE BEING ADDRESSED PERFORMANCE INDICATOR TARGET ACTUAL PERFORMANCE 2014 Council provides wastewater services at agreed levels of service. All seven community values, including: 3. That the wastewater network operates unobtrusively. Percentage of users satisfied with the quality of wastewater services provided : Equal to or greater than 95% 96% Wastewater services meet regulatory requirements. 2. That the treated waste water is safe to discharge back into the environment; 4. That the community and environment is protected from the risks surrounding the spread of disease and human waste. The wastewater service is operated in compliance with regulatory requirements. No abatement notices received. No enforcement notices received. No abatement notices and enforcement notices received (2013/14) Protection is provided to the community and the environment. 4. That the community and environment is protected from the risks surrounding the spread of disease and human waste. 5. That the wastewater service is reliable; Number of dry weather overflows from pump stations and / or the wastewater network. <1 pump-station overflow per 20 pump stations per year. <15 overflows from the pipe network per 100km of wastewater pipe length per annum overflows per 20 pump stations 3 overflows per 100km of network. Timely response to customer requests. 6. That the Council is quick to respond to interruptions to the supply if and when they occur; 7. That customer service requests are dealt with promptly and appropriately. Customer requests are responded to within target timeframes: Emergency call outs: resolved Less than 1 hour Urgent customer requests: Response within 1 hour Emergency call-outs: 100% Urgent customer requests: 80% or better Emergency 100% Urgent 77% Priority customer requests: Assessed within 4 hours Priority customer requests: 80% or better Priority 96% Routine customer requests: Call back within 3 working days Routine customer requests: 85% or better. Routine 70% July

20 5.5 TECHNICAL PERFORMANCE TARGETS The underpinning Technical Performance Measures are those used by the Council s engineers and managers to measure the technical details of the service provided, to enable them to deliver upon the Customer Levels of Service. Table 5.2: Technical Levels of Service, performance measures, targets, measurement procedures and monitoring frequencies. LOS No. Level of Service Statement Performance indicator Target Actual Performance 2014 Future Targets Measured (where and how) Exclusions Community Level of Service: Desired Community Outcomes: Council provides wastewater services at agreed levels of service Hauraki DC will provide a wastewater service that the community can afford. Hauraki District Council will provide a wastewater service that delivers a level of service customers desire and are prepared to pay for. WW 1 The wastewater service meets customers expectations. Annual Customer satisfaction survey: How satisfied, or dissatisfied, are you with the wastewater service provided by Council More than 95% of respondents are satisfied with the wastewater service 2014 satisfaction survey result 96% As per current target Annual Customer Survey Customers not currently connected to the wastewater network. WW 2 The wastewater network will operate unobtrusively. Number of customer complaints about the wastewater service for obtrusive issues, such as odour. < 5 per 1000 customers 0.3 complaints per 1000 connections. < 5 per 1000 customers By review of recorded customer service requests. Non-financial performance target quarterly reporting Multiple complaints involving the same incident from an individual customer count as a single complaint July

21 LOS No. Level of Service Statement Performance indicator Target Actual Performance 2014 Future Targets Measured (where and how) Exclusions Community Level of Service: Desired Community Outcomes: Wastewater services meet regulatory requirements Hauraki District Council will meet the legal requirements for a public wastewater service. In doing so, the Council can assure the community that: 1. The treated wastewater is clean and fit for return back into the natural environment; 2. The health of the community and environment is protected. WW 3 The wastewater service is operated in compliance with regulatory requirements. The number of abatement notices and enforcement notices received. Council receives no abatement notices or enforcement proceedings. No abatement notices or enforcement proceedings were received. As per current target Annual report from Utilities Manager Nil. July

22 LOS Level of Service Statement Performance indicator Target Actual Performance 2014 Future Targets Measured (where and how) Exclusions Community Level of Service: Desired Community Outcomes: Protection is provided to the Community and the Environment The wastewater network will be operated in a manner that protects the public from the risk of disease. Council's wastewater treatment plant discharges will comply with their resource consents. WW 4.1 WW 4.2 The number of dry weather overflows from pump stations and/or the wastewater network. The frequency of dry weather overflows from pump stations will be minimized. A dry day is defined as less than 1mm of rain falling in the catchment during the preceding 24 hour period. The frequency of dry weather overflows from the wastewater network will be minimized. Less than 1 overflow per 20 pump stations per annum. Less than 15 per 100 km of wastewater pipe length per annum overflows per 20 pump stations 3 overflows per 100km of network. As per current target As per current target Annual Report from Utilities Manager Annual Report from Utilities Manager Nil Nil WW 5 Dry weather overflows will be contained within 4 hours of notification. The percentage of dry weather overflow requests contained within 4 hours of notification. 80% or more 82% As per current target By review of recorded customer service requests and logged time of restoration. Private Sewer Faults Non-financial performance target quarterly reporting WW 6 The risk of public exposure to untreated sewerage will be minimized Percentage of overflows caused by the public sewer cleaned up within 24 hours of the overflow ceasing. 90% or more 94% As per current target By review of recorded customer service requests and logged time of restoration. Extreme weather. Dangerous working conditions. Non-financial performance target quarterly reporting Overflows gone unnoticed by the public, council staff and contractors. WW 7 The discharge from the waste water treatment plants will comply with resource consent conditions. The operation of the Wastewater Treatment Plant will comply with the conditions of the resource consents. Council receives no abatement notices or enforcement proceedings. No abatement notices or enforcement proceedings were received. As per current target Annual report from Utilities Manager Nil. July

23 LOS Level of Service Statement Performance indicator Target Actual Performance 2014 Future Targets Measured (where and how) Exclusions Community Level of Service: Desired Community Outcomes: Timely response to customer requests Customer service requests are dealt with promptly and appropriately. WW 8 Emergency situations created by a fault in the wastewater network are responded to rapidly. Incidents that fall into the category of Emergency as defined in Table 5.3. Appropriate action to safeguard the public and / or property is taken within 1-hour of notification. 100% 1 incident. Response time = 20 minutes. 100% By review of recorded customer service requests. Non-financial performance target quarterly reporting Nil WW 9 Urgent requests are responded to with minimum delay Requests falling into the Urgent category are defined in Table 5.3 Council staff or contractors will arrive on site to assess the appropriate response within 1 hour of notification. 80% 77% As per current target By review of recorded customer service requests. Non-financial performance target quarterly reporting Extreme weather, or dangerous work environment WW 10 Priority requests are responded to within an acceptable time. Requests falling into the Priority category are defined in Table 5.3 Council staff or contractors will arrive on site to assess the incident within 4 hours of notification. 80% 96% As per current target By review of recorded customer service requests. Non-financial performance target quarterly reporting Extreme weather, or dangerous work environment WW 11 Routine requests are responded to within a reasonable time Within 3 working days Council will contact the customer and advise of Council s intended actions and time frame. 85% 70% As per current target By review of recorded customer service requests. Nuisance or prank calls. Requests falling into the Routine category are defined in Table 5.3. If Council s management decides not to action the request, the customer will be advised of the reason and of other options available. Non-financial performance target quarterly reporting July

24 5.6 SERVICE REQUEST PRIORITISATION Target response times are set based upon the risk and consequence of the event that triggered the customer service request. As much as possible the priority levels have been aligned with the mandatory reporting requirements issued by the Department of Internal Affairs. Table 5.3 Target Response Timeframes Priority Level Description Target Response Time Emergency Urgent An Emergency situation is defined as an event that: Is a threat to life; Is causing damage to a habitable dwelling or Is obstructing a State Highway. A complete loss-of-supply of a service (water or wastewater connection) to greater than 1,000 people. An Urgent request is defined as: A complete loss-of-supply of a service (water or wastewater connection); or An imminent threat to a habitable dwelling; Appropriate action to safeguard the public and/or property is taken within 1 hour following notification. Council staff or contractors will have arrived on site to assess the appropriate response within 1 hour of notification. Priority Routine A Priority request is defined as: A partial loss-of-supply of a service (water or wastewater connection); or Flooding that is not threatening habitable dwellings; or A threat to non-moveable private property. A Routine request is one not falling into the above three categories. Routine requests will typically entail preventative maintenance activities, modifications, renewals, and replacements that have been requested by Hauraki District Council s customers. Council staff or contractors will have arrived on site to assess the incident within 4 hours of notification. Within 3 working days Council will contact the customer and advise of Council s intended actions and time frame. If Council s management decides not to action the request, the customer will be advised of the reason and of other options available. Routine service requests are submitted to the wastewater asset manager. This enables the asset manager to assess and prioritise the appropriate response to the request. Some requests may be scheduled to align with existing work programs, thereby achieving efficiencies in the delivery of the request. The customer call-back target has been introduced for the planning cycle. The desired outcome is improved communication with the customer. By calling the customer back to communicate the intended resolution action and timeframe it gives the customer a chance to correct the Council if the customer believes that the Council has not understood the nature or urgency of his or her request. Other benefits foreseen include a chance to explain to customers why their request may not be delivered for several weeks or months (or at all). For example, if the Council considers that the most efficient way to action the customer s request is to schedule it at a time when maintenance crews will be in the area, the maintenance may not occur for several months. This explanation will hopefully help the customer to understand that their request is not being ignored or forgotten, rather it will be addressed in due course. Council will assess the benefit of this introduced call-back procedure while preparing for the 2018 asset management plans. If the benefits are insufficient, the call-back procedure may be dropped. June

25 5.7 ANNUAL RESIDENT SURVEY Hauraki District Council carries out an annual survey to assess the customer satisfaction with the quality of the wastewater service provided by Council. Customers are selected at random for the annual survey. The survey indicates a very high level of satisfaction with the wastewater service that is being provided, with the satisfaction levels regularly reaching the ambitious 95% or greater satisfaction level set by the Council. Figure 5.2 Percentage of Customers Satisfied with the Quality of Wastewater Services Provided Percent Satisfied (%) 100% 90% 80% 70% 60% 50% 40% 30% 20% 10% 0% This high level of satisfaction indicates that the general public is unconcerned about the Survey Result Target quality of the wastewater service being provided. The lack of concern suggests that the Council s stated goals of operating the wastewater network unobtrusively, in a manner that protects the public health, and the environment have been met in the eyes of the public. Waihi Wastewater Treatment Plant June

26 5.8 LEVELS OF SERVICE CONSULTATION The Council endeavours to provide the required level of service that customers and stakeholders desire throughout the district. In order to provide an efficient level of service, consultation is carried out to identify the potential customers and stakeholders and relevant issues COMMUNITY CONSULTATION The mechanisms of consultation used for the wastewater service are the following: Annual Resident Satisfaction Surveys Levels of Service Review 2008 (thorough) Service request response levels Water & Waste Consultative Committee LEVELS OF SERVICE REVIEW RESULTS The findings of the 2008 Levels of Service Review for the wastewater services are: Customer Values Seven core values were identified for wastewater activity. They are discussed in Section 5.2 WHAT IS IMPORTANT TO THE COMMUNITY. Comments It is generally believed that the Districts wastewater system is working satisfactorily. Ensuring the environment is protected, rivers are not polluted and the network does not overflow are the main concerns. Agreed level of service 98% agreed to maintain the current rate and level of service. Overall rating 97% were satisfied to very satisfied. Observation Comments across the District on environmental issues show a genuine concern for environmental protection and prevention. Through Council reports Council have a responsibility to better inform the community on its prevention and mitigation measures. The high degree of satisfaction rating was further enhanced when 50% of participants (bus tours) were shown the Paeroa wastewater site in operation. June

27 5.8.2 WATER AND WASTE CONSULTATIVE COMMITTEE The Water and Waste Consultative Committee has representatives from Hauraki District Council, Waikato Regional Council, Federated Farmers, Environmental Groups and Iwi This committee is an advisory committee to Council and provides feedback and recommendations to Hauraki DC on the wastewater activity. 5.9 REVISION OF LEVELS OF SERVICE FOR The inference from the community consultation, as described in the section above is that the community is happy with the level of service currently provided and does not see a need for change. In 2014, central government introduced a requirement for local councils to report on key non-financial performance measures. These mandatory measures were prepared by the Department of Internal Affairs. In preparation for the planning cycle, Hauraki s level of service measures and targets were assessed and where necessary revised to better align with the newly introduced mandatory performance measures. Outside of this alignment, the level of service performance measures and targets were largely kept from the planning cycle. The LoS for the planning cycle will be consulted on during March / April The draft AMP and any changes to the LoS resulting from the community consultation will be finalized and adopted by Council in June June

28 6 DESCRIPTION OF ASSETS 6.1 OVERVIEW Hauraki District Council owns and operates the infrastructure to take wastewater from customer s properties, carry it to the treatment plant, treat the water, and return clean and safe water back to the environment. Infrastructure required to deliver the service includes: customer lateral service connections between the public sewer mains and the private property boundary (customers generally own the wastewater infrastructure within their property boundary); the pipes and manholes that convey the sewerage to the treatment plant; the pump-stations that lift the wastewater to a higher elevation within the network to enable it to continue its journey towards the treatment plant; and, the wastewater treatment plants; The 2014 valuation puts the total value of the wastewater asset within the Hauraki District at $70 million. By far the largest asset, by dollar value, is the wastewater reticulation network. The wastewater reticulation network comprises the gravity sewer mains; manholes; customer lateral connections; pump-stations and associated rising mains; and inspection points. Together, they comprise 85% of the total value of the wastewater assets. The wastewater treatment plants are the second-largest value asset, representing 14% of the total value of the wastewater asset. The remaining 1% of the asset value is the resource consents. The flat terrain in many parts of the District means that there is considerable reliance on pumping within the pipe network. These pump stations need regular maintenance and are vulnerable to power supply interruption. 6.2 INDIVIDUAL SCHEMES WITHIN THE DISTRICT The Council operates seven treatment plants - located at Waitakaruru, Ngatea, Kerepehi, Turua, Paeroa, Waihi, and Whiritoa (described West to East) - to which approximately 6,050 properties are connected. The sewer network includes 50 pump stations which are used to lift the wastewater to a higher elevation to enable it to continue its journey towards the treatment plant. Together the seven schemes comprise approximately 160 km of gravity sewer mains. Figure 6.1: Size of the Schemes operated within the Hauraki District Ngatea 1010 Paeroa 3070 Waihi 3290 Kerepehi 270 Turua 210 Whiritoa 130 Waitakaruru 50 Figure 6.1 illustrates the size of each of the seven schemes by presenting the population served by each wastewater treatment plant. (reported value is the population served by each scheme). June

29 6.3 WASTEWATER NETWORK ASSET DESCRIPTION The two main reticulation networks which account for approx 70% of the District s reticulation are Paeroa and Waihi. Each of these has pipe lengths of nearly 50 kilometres (excluding laterals). Approximately 25% of the wastewater carried from these two systems is commercial or industrial. Other systems within the District cater for predominantly domestic wastewater (between %) with a few industrial and commercial properties being provided for. The type of pipe material used in each system is dependent on the period it was installed. Pipe material type ranges from Earthenware (GEW), Asbestos Cement (AC) through to Polyethylene (PE). An overview of the development of the District s reticulation schemes is as follows: Table 6.1: Brief history of the establishment and development of each scheme Reticulated wastewater systems were established in the Hauraki District Townships as detailed below: Kerepehi Hauraki Plains County Council commenced construction of a reticulated system in Ngatea Paeroa Turua Waihi Waitakaruru Hauraki Plains County Council commenced construction of a reticulated system and an oxidation pond in 1980/81. Wastewater Treatment Plant upgrade was completed Paeroa Borough Council commenced construction of 40 per cent of the existing reticulated system between 1925 and 1940 and the balance was laid between 1965 and The original treatment plant was built in 1982/83. There were extensions to the system in 1991 covering areas outside the original approved boundaries. Construction of a new treatment plant at Irwin Road was completed in Hauraki Plains County Council established the reticulated system and an oxidation pond in 1982/83. A new Maturation pond was installed in May Waihi Borough Council established about one-third of the current reticulated system and a small oxidation pond in From 1984 to 1989 the remaining two-thirds of the system was established, the oxidation pond was enlarged and a second pond was installed. A new tertiary treatment plant was installed in June 2005 A small system was established in 1963 by the New Zealand Co-operative Dairy Company to service staff housing. A new wastewater plant and reticulation system was installed in June This included a pressure sewer service to address issues associated with the disposal of wastewater effluent by soakage using private treatment facilities. The high groundwater tables in the area precluded and/or made soil based effluent disposal systems ineffective. Whiritoa Hauraki District Council established a reticulated system and treatment plant in 1989/90. In addition to the areas served by the public systems, the balance of the population disposes of its sewage by private means. June

30 Figure 6.2: Sewer Main Installation Profile Length Constructed / Renewed (km) 60,000 50,000 40,000 30,000 20,000 10,000 The majority of the reticulated network within the district has been installed post-1970 (Figure 6.2). Therefore, relative to many other districts within NZ, the Hauraki District has relatively young wastewater network infrastructure. The young age of the network would support the view that Hauraki District Council s wastewater infrastructure is largely in good condition The younger age means that the asset has a high proportion of more modern pipe materials that can be expected to be more watertight than those commonly used in wastewater networks elsewhere in New Zealand. The watertight pipe materials mean that ingress of rainfall and groundwater should not be a major issue for the District. This is discussed in some detail in Section 7 Demand Management. The pipe material distribution is presented in Figure 6.3. This shows that by far the longest length of pipe material used within the district is PVC. PVC is modern sewer pipe material that is relatively inert and all indications within the industry to date are that its life expectancy is 100 years plus. Because of the long life and relatively young age of the PVC pipes in the district no PVC is forecast to require renewal within the next 30 years. Figure 6.3: Water Main Material Profile Length (km) However, the second longest material is asbestos cement. This represents a risk to the district, because asbestos cement is expected to have a relatively short lifespan of between 60 and 90 years. Hauraki DC addresses this issue, by proactively monitoring its asbestos cement pipes. The renewal forecasts and financial implications of renewing the asbestos cement pipes show that increasing amounts of asbestos cement pipe will need replacing within the 30-year forecasts of this AMP. The renewals section of this AMP shows that the cost and volume of this work is not prohibitive for the District. Unknown PVC Asbestos Cement Glazed Earthenware Polyethylene Alkathene Concrete Lined Steel Reinforced Concrete Cast Iron Steel (all forms) June

31 6.4 WASTEWATER TREATMENT ASSET DESCRIPTION The size, type of treatment, and take-up of consented discharge are described in the table below. Table 6.2: Treatment Type and Size of the District s Water Treatment Plants AREA AVERAGE SYSTEM VOLUME (PER DAY) RESOURCE CONSENT PERMITTED DISCHARGE (PER DAY) CONNECTED PROPERTIES TREATMENT PROCESS DESCRIPTION Kerepehi 190 m³ 834 m³ 210 Wastewater is treated in two oxidation ponds and then discharged to Awaiti Canal. Ngatea 300 m³ 6050 m³ 640 Wastewater is treated in a single cell aerated oxidation pond, and drip fed onto two gravel beds prior to being discharged to land adjacent to the Piako River. Paeroa 2,650 m³ 4000 m³ during normal operating conditions, or 5800 m³ when pond levels high due to wet weather 2,230 Wastewater is treated in three aerated lagoons, drip fed onto eight gravel beds, disinfected by UV, and then discharged to land adjacent to the Waihou River. Turua 100 m³ 250 m³ 170 Wastewater is treated in a single cell aerated oxidation pond, through a series of maturation cells with gravel filters, and then discharged to land adjacent to the Waihou River. Waihi 1,480 m³ 4000 m³ 2,240 Wastewater is treated in a twostage oxidation pond, prior to nutrient removal in an IAF tertiary plant, UV treated, and then discharged to the land adjacent to the Ohinemuri River. Waitakaruru 20 m³ 75 m³ 55 Wastewater is treated in advanced septic systems at each property, pumped to the treatment plant where it is further treated by re-circulating textile reactors, UV treated, and then discharged to land adjacent to the Maukoro Canal. Whiritoa 60 m³ 392 m³ 490 Wastewater is treated in a facultative aerated pond, followed by a storage pond from which it is irrigated onto an 8 ha eucalyptus plantation. TOTAL 4,800 11,350 6,050 June

32 Over the past 10 years, the Council has completed a major programme of consent renewals and upgrading of wastewater treatment plants at Paeroa, Waihi, Ngatea, Kerepehi and Turua. A new wastewater collection and treatment system has been installed at Waitakaruru. The recent upgrades mean that the District s wastewater treatment plants are treating water to modern standards. As such, when the wastewater treatment Plant discharge consents come up for renewal over the next six years (Table 9.4), Hauraki District Council anticipates that the District s wastewater treatment plants will be able to meet the conditions imposed by the new consents without significant upgrade. On this basis, Council has not forecast large expenditure to lift the treatment standard of the District s wastewater treatment plants within the next 30 years. DISPOSAL OF SEPTIC TANK EFFLUENT The Council maintains a facility for tanker trucks to dispose of septic tank effluent, and monitors the volume of this waste which is delivered to the network. The current system appears to be suitably sized at least for the period of this Plan. 6.5 ASSET REGISTERS Council s asset management system, AssetFinda TM, stores all primary asset information into one system. All asset information is stored in an asset hierarchy where it can easily be accessed by query based on asset activity type, asset sub type, location and down to individual asset level. More detailed information regarding each asset is captured in attribute sets linked to each asset e.g. size, material, location, length etc. Additional asset data such as asset criticality, condition ratings, valuation information, spatial and metadata and are also stored against each asset where applicable. Inspection data, failure data, performance and maintenance records and history will in due course also be captured. These records are currently managed through manual processes and captured by other systems and processes. The asset management improvement programme describes a project to create an Asset Criticality Management database documenting asset condition, and inspection data. This is described in greater detail within the Risk and Lifecycle sections of the AMP. June

33 6.6 FINANCIAL DESCRIPTION The wastewater assets were valued by Opus International Consultants as at 1 July Both underground infrastructure assets e.g. pipes, manholes etc. and above ground assets e.g. treatment plant assets, pump stations, structures etc. have been valued. The following tables provide the Optimised Replacement Cost (ORC) and assessed Fair Value (ODRC) for the wastewater systems and assets, as determined by Opus consultants. Table 6.3: Wastewater Asset Valuation as 30 June 2014 ASSET QUANTITY OPTIMISED REPLACEMENT COST 1 ($ million) FAIR VALUE 2 ($ million) Treatment Plant Gravity Sewers 128 km Manholes 2, Laterals 6, Aerial Crossings 10 < 0.00 < 0.00 Inspection Points Rising Main 30 km Consents Total Optimised replacement cost assesses the replacement cost of equivalent performance assets at the date of valuation. 2. Fair value is based upon the optimised depreciated replacement cost (ODRC). It defines the fair value of assets as the gross current replacement cost less allowances for physical deterioration, optimisation for obsolescence and relevant surplus capacity. June

34 7 DEMAND AND GROWTH 7.1 FUTURE DEMAND The population in the Hauraki District is projected to remain virtually static over the next 10 years followed by a slight decline to However the lack of population growth in the district population disguises changes that are expected to occur in the profile and spatial distribution of the population. Most significant is the change in the age profile within the district, characterised by a markedly ageing population and matched by a decline in the population below 64 years of age. The changing age profile of the district s population is expected to affect the average household size which is projected to continue to reduce over the long term. From a wastewater perspective, the decrease in average household size is likely to increase water use and hence waste water generation per capita. Studies indicate that households with a higher number of people use their water more efficiently per person, as daily tasks such as dishwashing and clothes washing require a similar daily volume of water irrespective of the number of people living in the household. Projections also indicate that the majority of dwelling growth is likely to occur in the form of lifestyle properties outside of existing settlements. As the rural community is not serviced by a public wastewater service, this growth is not forecast to have any significant increase demand on any of the district s public wastewater schemes. The cost of providing the rural community with a public wastewater service with today s materials and technology would be uneconomic. Therefore unless a new, ground breaking technology is developed in the future, it is safe to assume that the rural community will not be serviced in the future. It is considered that future technological improvements are more likely to improve private wastewater systems than lower the cost of piped public systems. Improvements in private wastewater treatment systems would further preclude a public wastewater service from being viable for rural customers. RAINWATER AND GROUND WATER INFILTRATION As wastewater networks age they become less watertight. This is a natural progression for a gravity sewer and reasonable levels of rainwater and ground water infiltration are accepted within aged wastewater sewers. Hauraki DC, along with numerous other councils, have concluded that it is cheaper to treat reasonable amounts of rainwater and groundwater ingress than the alternative, which is to repair or renew the network to stop the water getting in. It also follows that the cheapest life-cycle option is to design sufficient capacity into the network so that when rates of rainwater and groundwater infiltration increase as a result of the deterioration of the asset, the network still has sufficient capacity to cope with the infiltration. Hauraki District Council factors future deterioration into its new and renewed wastewater infrastructure. North Shore City Council (NSCC) had an advanced wastewater infiltration program that formed a subproject within their larger wastewater network upgrade project that called Project CARE. Project CARE ran between 1998 and Hauraki District Council is applying the lessons learned from NSCC s wastewater infiltration program in the management of infiltration within the District 2. 2 Several other leading wastewater service providers are also using or have used findings from North Shore City Council s infiltration program. These organisations include: the Water Services Association of Australia, Sydney Water, Watercare, and in the USA, The East Bay Municipal Utility District. June

35 NSCC s program then ensured efficient use of the renewals spend by assessing the network s ability to cope with the measured infiltration. Because of the high cost of repair / renewal to prevent and reduce rainwater and groundwater infiltration; renewal work was only carried out when no other cheaper alternatives exist. Under the assessment criteria, infiltration was not regarded as excessive, unless it consumed all of the required capacity for the normal operation of the wastewater network. Hauraki s flow gauging program has identified the wastewater catchments with the highest rates of rainwater and groundwater infiltration. Hydraulic models will be used during the next three-year planning cycle to assess the capacity of the network to cope with current and future rates of infiltration. Sections of the network that have reached or will soon reach full capacity due to high rates of infiltration will be scheduled for renewal and/or upgrade. Hauraki will flow gauge the wastewater networks on a 10-year rolling cycle. This rolling programme ensures that future demand from rainwater and groundwater infiltration is managed in a manner that prevents overflows from the wastewater network. INDUSTRIAL WATER USE Council is actively promoting the Hauraki District to industry. Industrial users, depending on the nature of the industry, can be very large users of water. It would not be uncommon for a wet industry to consume 1,000 m 3 of water per day. To give some idea of scale, this volume of water, if entirely returned to the sewer, would represent roughly 40% of the daily inflow into the Paeroa wastewater treatment plant on a dry day; and 120% of the Waihi wastewater treatment plant inflow. Because a single wet industry customer can increase demand by such a large percentage, wet industry represents an unknown area of risk in respect of the growth in demand within the district. However, the cost of increasing capacity to meet future industrial demands can be passed on to the incoming industry. Industrial applications to connect to the public wastewater network are dealt with on their commercial merits and the unquantifiable risk surrounding unknown future industrial demand can be transferred away from the community and onto the prospective industrial customer. This risk then no longer needs to be managed as a part of current asset management planning processes. LEVEL OF SERVICE INCREASE As discussed in section 5.8, the most recent detailed survey of community satisfaction with the levels of service being provided indicated that 98% of the community wish to maintain the current rate and level of service provided by Council. This strong support for the levels of service to be maintained at current levels indicates that future demand from the community for higher levels of service is unlikely. It is considered more likely that increased levels of service will be mandated by central or regional government. The increased treatment requirements of the New Zealand drinking water standards (DWSNZ v2008) are a recent example of this. Changes of this nature are, however, usually well signalled several years in advance by central government. Hauraki is currently unaware of any intentions by central government or the regional government to mandate any changes to the wastewater treatment standards required within the District. Containment Standards As described in greater detail in Section 7.2, the Waikato Regional Council currently has a high wastewater containment standard that is more stringent than standards recently developed in other regions after sound analysis of environmental impacts versus costs. While the wastewater networks in the Hauraki District due to their young age currently meet the containment standards with little exception 3,, as the networks degrade with time, it is unlikely that they will continue to do so indefinitely. 3 A small area serving a total of 185 houses does not currently meet this requirement. This is discussed in detail in Section 7.2. June

36 Intrinsic within the renewals forecasting carried out by Hauraki District Council, is the assumption that the current extremely high containment standards required by the Waikato Regional Council will be relaxed to similar containment standards required within the Auckland Region at some stage within the next 30 years. If the wastewater network containment standards are not relaxed sometime within the next 30 years, then the pipe and manhole lives assumed within current forecasts will need to be shortened. This will follow through to higher annual depreciation rates, and higher operating costs of the wastewater network for the community. THE EFFECT OF CLIMATE CHANGE ON THE WASTEWATER NETWORK DEMAND Research undertaken by the University of Waikato (2011) indicates that, in the context of the Waikato Region, Hauraki District s exposure to climate change events is largely in terms of future extreme rainfall and drought conditions. This means that the District is expected to experience both an increased risk of heavy or prolonged rainfall and also extended periods of reduced rainfall. Such events have implications for the volume of wastewater that will be conveyed and treated. Prolonged Rainfall Prolonged rainfall impacts the wastewater network within the district by increasing groundwater levels. Raised groundwater levels increase the chance that groundwater will find its way into minor defects within the pipe network. If this occurs, the base flow of the wastewater network will increase during winter months. Increased base flow has the effect of consuming the latent capacity within the network and treatment facilities. To address this, Hauraki District Council has implemented a program where wastewater catchments within the district are monitored on a 10 year rolling cycle. This enables the Council to track any increase in groundwater infiltration over time. The groundwater flows are then assessed on a calibrated hydraulic model, and any implications in terms of the latent capacity being consumed by the groundwater ingress can be identified. Plans to address any problems caused by the consumption of latent capacity by groundwater can then be developed. The flow gauging program carried out by Council has already identified one small area within the Waihi township and a second small area within the Paeroa Township which have excessive groundwater flows. The affected areas are small in size, within the extents of circa 200 houses (the combined total of both areas). Regardless of the small size of the area, Council has programmed a project with the target completion date within the next three years to investigate the source of these flows as a part of the ongoing maintenance of the network. As further information comes to hand, Council will assess options to address these flows. Outside of these two small areas, flow monitoring carried out by the Council has not shown excessive groundwater infiltration. Heavy Rainfall Heavy rainfall poses a greater threat to achieving level of service targets than groundwater. If heavy rainfall is able to get into the wastewater network, it can quickly overwhelm the sewer system, causing the network to overflow. The same flow monitoring and hydraulic modelling studies used to monitor groundwater infiltration will also be used to monitor for any problems caused by heavy rainfall entering the wastewater network. The 10 year rolling monitoring program that has been implemented will help enable Council to identify any deterioration in the water tightness of the network, and areas where heavy rainfall ingress could become problematic in the future. June

37 Currently, Council is aware of a small area of the Paeroa township (circa 185 houses) that has a problem with heavy rainfall entering the sewer. Council has programmed a project to further investigate and correct this situation. The project is scheduled for completion within the next six years. Longer, more Severe and Frequent Drought Periods without rain during summer months are expected to become more prolonged as a result of climate change. There are no foreseen implications of increased drought on the wastewater activity. The Kerepehi Floating Wetlands The plants in the floating wetland adsorb nutrients from the wastewater prior to discharge back into the environment. June

38 7.2 DEMAND MANAGEMENT Demand on the wastewater network is comprised of two sources of flow: 1. The return to sewer from potable water used within residential, commercial, and industrial premises; and, 2. Rainwater and groundwater entering the wastewater network. DEMAND MANAGEMENT TARGETS Council has set demand management targets for both sources of flow. We describe these below. Demand from Return to Sewer of Potable Water The volume of sewerage entering the network from residential and commercial premises is largely dictated by the volume of potable water consumed on the property. In this regard, the best way to reduce and manage demand for this source of wastewater is to manage the volume of potable water consumed. Figure 7.1: Urban Water Use per Capita vs. Demand Management Targets Urban Water Consumption 400 Per Person Water Consumption (L/person/day) Urban Water Use Target The values presented are averaged over the Financial Year 1 July to 30 June. They include all urban water use by residential, commercial, and industrial water users. In this regard, Hauraki District Council has set a demand management target for the volume of potable water used per capita within the district. Described in detail within the Water Supply AMP, the target is: Urban water use: o Average annual water consumption within urban communities is less than 300 L per person per day. Commercial use is encapsulated within this target. Benchmarking the urban water use across other districts in NZ, shows that urban water use within the Hauraki District is low to normal when measured on a per capita basis. Because of this, Hauraki s demand management targets are static, i.e. we do not see the need for a sinking lid reduction target. Water usage data over the past three years shows that both the urban water use targets are being met. Over the past three years the water use per person has increased slightly. Council is aware of this issue and is monitoring it to see whether it is part of a longer term trend, or simply a short-term blip in usage patterns. The volume of sewerage returned to the sewer from commercial and industrial use does not have a direct correlation with the volume of potable water consumed. The return to sewer from industry is entirely dependent on the industrial activity been carried out on the premise. As described earlier, commercial connections to the wastewater network of this nature are assessed on their commercial merits. Commercial discharge into the wastewater network is managed through the Council s trade waste and wastewater bylaws. Rainwater and Groundwater infiltration Targets The Waikato Region is different to several other regions in that overflows from the wastewater network are a prohibited activity under the Regional Plan. This means that they must never occur, which is a very high standard. In contrast, in Auckland, Watercare s wastewater network has consents permitting overflow. Those consents require Watercare to work towards lifting the performance of the wastewater system so that it overflows no more than 2-times per year, on average. Where the cost of achieving two overflows per year is considered uneconomic, Watercare can propose a best practicable option for consideration. The best practicable option has been introduced to ensure that the central June

39 government s directive that the cost of environmental management is balanced against rational economic decisions has, and can be met. HDC has encapsulated the Waikato Regional Plan within its LoS design targets, in that the LoS targets stipulate that the wastewater network will comply with all relevant legislation. Relevant legislation includes the Regional Plan. Therefore, the design target for rainwater and groundwater that is imposed upon the Hauraki District Council by the Waikato Regional Council is that the network will never overflow. The cost implications for the community of the more stringent standards imposed by the Waikato Regional Council (as opposed to the standards required in Auckland, for example) have not yet been calculated by Hauraki DC. Studies carried out by Hauraki District Council and other councils within New Zealand have repeatedly concluded that it is cheaper to treat rainwater and groundwater that enters the sewer network than it is to stop it entering. Other studies have shown that it is impossible to stop all of the rainwater and/or groundwater entering the sewer through network renewal using trenchless sewer techniques. These studies concluded that after a completely renewing a catchment using trenchless technologies, 30-60% of the original ingress still remained. Ingress of rainwater and groundwater is therefore accepted as an inevitable part of a public wastewater system by Hauraki District Council. The demand management target for rainwater and groundwater infiltration is to manage the amount of infiltration such that the wastewater network does not overflow, and that the wastewater treatment plants do not exceed their consented discharge volumes. DEMAND MANAGEMENT Demand from Return to Sewer of Potable Water As described in section 7.1 Future Demands, above, demand management of the return of potable water to the sewer is not seen as a major issue within the district. Flow gauging studies have shown that the District s wastewater networks have capacity well in excess of that required to convey the current and future volumes of sewerage originating from potable water use. Hauraki s demand management strategy for rainfall and groundwater ingress is entirely performance based. The Council will accept ingress of rainwater and groundwater, provided it does not cause sewer overflows nor exceed consented discharge volumes for the treatment plants. The demand for sewer capacity from the potable water return to sewer is controlled through the water supply demand management practices, which are described within the Water Supply AMP. Demand from Rainwater and Groundwater Ingress It is a well-known fact that over time increasing amounts of rainwater and groundwater will enter sewer systems. There are two primary mechanisms for this: i. The first is that the number of illegal connections of stormwater into the wastewater network increases with time. These usually occur when homeowners (usually unknowingly) connect their stormwater systems into the wastewater sewer. These illegal connections occur as a result of the kiwi do-it-yourself attitude; with residents seeking to address stormwater issues on their private property. ii. The second mechanism is that cracks and gaps in pipe joints form over time in the public wastewater network. These cracks form primarily as a result of ground movement and installation defects that manifest themselves with the passage of time. Roots of some trees are capable of breaking apart older (non-plastic based) pipe materials. Where there is a weak point in the system rainwater or groundwater will enter the network. June

40 Hauraki DC has implemented a rolling 10 year program to flow gauge and model the wastewater networks. Through this program, Hauraki: Is able to assess the hydraulic capacity of the network, throughout the entire network; Is able to assess how much of the network capacity is being used by demand from: o the return to sewer of potable water; o groundwater infiltration; and, o ingress of rainfall during heavy rainfall. The rolling nature of this program enables any increase in the volume of groundwater and rainwater entering the sewer network to be tracked over time. The calibrated hydraulic models enable potential future problems surrounding lack of capacity to be identified before they occur, and solutions implemented to address them. The flow monitoring has shown that with little exception, the wastewater network within the district is of good condition, and performing well. Rainwater and groundwater ingress is not currently a large issue for the district. There are exceptions to this statement, however. These are the three problem areas already mentioned (two small areas where volume of groundwater her house is high, circa 200 houses, total; and one area where heavy rainfall is causing problems, circa 185 houses). Council has projects programmed to further investigate and correct the excess groundwater and rainfall in these three areas. The flow monitoring of the wastewater networks throughout the district has shown that with little exception, the wastewater network within the district is of good condition, and performing well. Rainwater and groundwater ingress is not currently a large issue for the district. June

41 7.3 POPULATION PROJECTIONS HISTORIC POPULATION NUMBERS Over the past 20 years, the Hauraki District has had a small, but steady, increase in population. However, the 2001 census showed a decrease in population which goes against the trend in earlier years. During November 2010 the Kaiaua area was incorporated into Hauraki district when the Auckland City was amalgamated. The population in 2001 was 16,764. In 2006 it was 17,751 (Kaiaua included) an increase of 5.9% in Hauraki District population. The table below provides the population projections by Statistics NZ (Kaiaua included). Table 7.1 Population measured over the past three Census Review of this table shows that the usually resident population of the district is estimated to be around 18,280 people. The population within the district has grown by only 300 people over the past 12 years (0.1% per year). All of the growth occurred in the period between 2001 and 2006, before a minor decline over the past seven years. Over the same period, more than 1,100 new dwellings have been built an increase of around 1.1% or 92 dwellings per year. This is reflective of the shift towards lower occupancy per dwelling within the district discussed in Section FUTURE POPULATION FORECASTS Table 7.2 below presents the population forecast for the Hauraki District. The usually resident population is forecast to decrease by 230 people over the next 30 years. The total number of dwellings is forecast to increase by approx 1,100. In summary, the population is forecast to essentially stay the same, however, due to a move towards lower occupancy per household, a there is a forecast 13% increase in the number of dwellings within the district. Table 7.2: Population Projections June

42 8 RISK MANAGEMENT Risk is managed in a manner that enables the key business objectives and community outcomes to be consistently achieved. Potential risks to the wastewater services and assets are identified, analysed, and mitigation strategies developed. The diagram below outlines the process Council follows to ensure risk management procedures are successfully applied to wastewater service s significant and critical assets. Figure 8.1: Risk Management Framework & Process Establishing the context Risk Assessment Risk Identification Communication & Consultation Risk Analysis Risk Evaluation Monitoring & Review Risk Treatment Analyse & Treat Residual Risks This risk management section of the Asset Management Plan: Discusses the context within which the risks must be evaluated. Identifies and prioritises potential risks to the wastewater services and assets. Analyses the consequences and likelihood of those risks occurring. Describes the treatments and controls used to mitigate those risks. Residual risks remaining after the implementation of risk control strategies are also analysed and the effectiveness of treatment options and control processes evaluated. Risks are categorised into: Very high; High; Medium; or Low. June

43 In early 2005 Council drafted and promulgated an Assessment of Water and Sanitary Services under Section 125 of the Local Government Act The assessment analyses the risks that may threaten the successful provision of the service and includes mitigation plans. This was reviewed in 2014 as part of the LTP process. In 2008 a structured risk analysis and prioritisation exercise following Risk Standard AS/NZS 4360:2006 was performed for wastewater assets and services to guide the preparation of plans and strategies to minimise the likelihood and mitigate the impacts associated with identified risks. The Wastewater Risk Analysis exercise can be accessed in Council s document management system, Fred DM no This work has been reviewed as a part of the planning cycle and found still relevant for the 2015-planning cycle. In terms of the HDC AM Policy 4, parts of the Risk Management activity for the wastewater activity are to be carried out at the Core Plus level, as detailed in Table 8.1 below. All other asset management activities require only the Core level of asset management. Council s AM Policy requirements for Risk Management are detailed below: Table 8.1: HDC Policy Risk Management Levels of Asset Management RISK MANAGEMENT ELEMENT Identify critical assets Identify significant negative effects Legislation Requirement for risk met Identify associated risks and risk management strategies for critical assets Recognition & application of principles of integrated risk management to assets demonstrated Apply standards & industry good practice (e.g. NZS4360 and Local Government Handbook) Risk Management integrated with other Corporate processes (Lifelines, Disasters Recovery, Continuity Plans) Integrate with maintenance and replacement strategies LEVELS OF ASSET MANAGEMENT REQUIRED Core Core Core Core Core - Plus Core - Plus Core - Plus Core Plus NOTES Corporate approach Extension of criticality practice 4 Based on the study performed by Waugh Infrastructure Management Selecting the Appropriate Asset Management Level (DM ). June

44 8.1 FOCUS ON CRITICAL ASSETS The identified criticality of assets is recorded in the AssetFinda Asset Management (AM) system. The criticality methodology is based on work by Waugh Infrastructure Management; the grading criteria have been developed by Hauraki District Council. The criticality criteria are based upon the potential unmitigated consequence, if the asset were to fail. Assigning the criticality based upon the unmitigated consequence serves to ensure that asset management practices provide appropriate warning to manage and mitigate these risks. The criticality grading criteria are related to the number of people directly and indirectly affected; and the potential duration of supply interruption if repair work were to experience difficulty. The criticality grading criteria are presented below in Table 8.2. Table 8.2 Asset Criticality Grading Criteria Assigned Criticality Very high criticality High criticality Medium criticality Low criticality Very low criticality Potential Unmitigated Consequence of Failure (Assuming that repair work experiences difficulty) Failure of the asset is unacceptable. Significant and widespread consequences of failure, such as: Servicing 500 or more people with potential for a repair to take 8-hours or more; Potential disruption to the activities of 1000 or more people for more than 8-hours; Significant potential for damage to multiple buildings. More than minor consequences of failure, such as: Servicing 100 or more people with potential for a repair to take 8-hours or more; Servicing 500 or more people with potential for a repair to take 4-hours or more; Potential disruption to the activities of: o 100 or more people for 8-hours or more; o 500 or more people for over 4 hours; Significant potential for damage to one or more habitable buildings. Isolated impacts from failure, such as: Loss of supply to less than 10 people for 8-hours or more; Potential disruption to the activities of less than 100 people or more for 8-hours or more; Low potential to damage buildings. Minimal impacts from failure, such as: Loss of supply likely to be restored in less than 4-hours; Minor or no disruption to the community; Asset managers and operational staff review the criticality of the district s wastewater infrastructure assets against these criteria on a 3-yearly basis, as a part of the asset management planning cycle. Development of a database to manage the mitigation of risks associated with critical assets is provided for on the asset management improvement programme. It is envisaged that the database will: Store the mitigation strategies for each of the very high, high, or medium criticality assets. Mitigation strategies are not developed for low and very low criticality assets. Be used to track and schedule proactive condition assessments for the very high and high criticality assets. Document the assessed time to repair for very high, high, and medium criticality assets; and, Document proactive and opportunistic condition based sampling results. The implementation of an Asset Criticality Management database, and the populating of mitigation strategies for very high, high, and medium criticality assets are both scheduled for completion before June 2018 in the AMP improvement plan. June

45 8.2 RESIDUAL RISK The residual risk is that which remains after mitigation measures have been implemented. The residual risk strategy is to maintain senior management and relevant staff awareness of the residual risk. Once the planned Asset Criticality Management database has been populated with the mitigation strategies for Very High and High criticality assets, the Asset Management Manager will prepare a residual risk report. The residual risk report will be updated three yearly, in line with the three year planning cycle. This report will be provided to the executive management team and the utilities manager, asset management staff; senior engineering staff both in the office, and in the field. Key points will be summarised in subsequent asset management plans. 8.3 RISK MANAGEMENT STRATEGIES A risk analysis has considered events related to business risk, environmental risk (weather); and asset risk. Table 8.3 shows the highest priority risk events, the analysis, risk priority, vulnerability or flow-on effects and their mitigation strategies. The risk mitigation strategies and procedures still require development and documentation. Strategies likely to be used for mitigating specific risks are the following: Reduce probability of failure by capital works (renew, provide redundancy, upgrade), maintenance expenditure, operational documentation, training, etc. Reconfigure the network to minimise disruption. Reduce the impact of a failure by emergency response plans. Insure against the consequential costs. Various insurance products are available to insure against perils like fire, theft, vandalism and even environmental disasters like earthquakes (e.g. Standard Material Damage (SMD)). Other products will provide cover against risks such as public and professional liability, consequential loss (e.g. a crash due to traffic lights malfunctioning) etc. Council is also part of the LAPP 5 fund that may assist when a catastrophic event damage infrastructure not covered by MD policies. A combination of the above EMERGENCY FAILURES Asset failures are either logged by internal staff with the wastewater utilities manager, or if identified by the public are recorded in the Customer Service Request System and allocated to the appropriate service person. Response to the failure is determined by the priority grading of the incident. The priority grading assigned to customer requests is detailed in Section 5.6. Council s customer service staff are trained to assess the priority of an incident, and the required actions to take according to the priority of the request. True emergency failure will receive a priority grading of Emergency ; Urgent; or Priority, according to the Council s prioritisation grading system. Such incidents are forwarded directly to the field staff manager to ensure the fastest possible response. The required response times to the level of service interruptions are provided in the levels of service section, Section Local Authority Protection Programme which is a mutual fund that will contribute to council s responsibility of paying 40% of damages in case of a catastrophic event destroying significant sections of reticulation and infrastructure not covered by standard material damage insurance policies. June

46 8.4 CATASTROPHIC EVENTS In the event of a larger scale service interruption e.g. due to a catastrophic event like an earthquake, council has an Operative Civil Defence and Emergency Management Plan which, will see the establishment of an emergency management headquarters within the Hauraki District or the Thames Valley Combined District. In recent years emergency conditions have resulted from the effects of weather (e.g. flooding, wind). However, the Operative Plan caters for operational systems in response to all possible civil defence emergencies including earthquake, fire, hazardous substances, volcanic eruption and subsidence. The Council is an active member of the Waikato Civil Defence Emergency Management Group and the Thames Valley Combined Civil Defence Committee, which includes all local authorities within the Waikato Region including the Waikato Regional Council. This group was established under the Civil Defence Emergency Management Act 2002 (CDEM Act). The CDEM Group's members work together to manage responses to Waikato s hazards so that the communities face acceptable levels of risk. Arrangements for managing emergencies in a coordinated, multi-agency manner are specified in the Waikato CDEM Group Plan. As an integrated part of the Group Plan, this local arrangement specifies the unique local operational arrangements of the Hauraki District Council. HDC also has a Pandemic Response Plan in operation. The details of this plan mostly directed at the consequences and impact of swine flu pandemic. 8.5 RISK MANAGEMENT AT CORPORATE & SERVICE LEVEL The risk framework used to analyse and to prioritise risks is implemented at a corporate and service level. Risks across the total spectrum from catastrophic events e.g. earthquakes, tsunami s etc. to more regular occurring risks with smaller impacts e.g. pipe burst, flooding etc. are analysed using the same framework. The risk framework is also used to analyse risks across most asset activity areas e.g. water supply, wastewater, solid waste etc. Risks are identified and analysed for the business risks at all organisational levels (strategic, tactical and operational). The Risk Register, Table 8.3, identifies the very high and high priority risk events linked to business risks, each asset group and high critical assets. The table distinguishes between business risks, which are corporate level risks that impact on council business as a whole; and asset risks which focus on specific risks affecting designated groups of assets e.g. treatment plants or reticulation. June

47 8.6 LEGISLATIVE REQUIREMENTS FOR RISK MANAGEMENT Risk management processes, analysis and strategies have been developed in line with risk standards namely AS/NZS 4360:2004 Risk Management Standard and AS/NZS 31000:2009 Risk Management Principles and Guidelines. AS/NZS 5050:2010 Business Continuity Management is the newest standard and is yet to be incorporated in the business processes of the organization. 8.7 INTEGRATION WITH MAINTENANCE & REPLACEMENT STRATEGIES The management and mitigation of risks forms a key part of the Lifecycle Management Strategy. This is discussed in detail within the life-cycle Management section of this asset management plan. June

48 8.7.1 Risk Register The table below shows a summary of the Wastewater Risk Register and Control Schedule for with unmitigated risks assessed to be Very High or High prior to Mitigation. Table 8.3: Risks for the Wastewater Activity deemed Very High or High prior to Mitigation 6 RISK TYPE RISK EVENT WEAKNESS OR VULNERABILITY MITIGATION STRATEGY STRATEGY TO DEVELOP RESIDUAL RISK PRIORITY LEVELS OF SERVICE IMPACT Regulatory Changing environmental standards Increased capital and operating expenditure to comply as new consents require more rigorous conditions Maintain watch on policy development HIGH Potential for increased costs for community if environmental standards are tightened (the wastewater service is affordable). Business / Management Sub-standard operation of assets Assets deliver below capacity Follow asset management plan strategies in operations and maintenance activities. LOW The network may fail to meet overflow targets. Gradual decline in the monetary efficiency in the wastewater activity (decreased value for money). Business / Management Ad-hoc/ reactive decision making Focus on long term objectives lost Follow asset management plan strategies in decision making processes. LOW Slow deterioration of level of service delivered to customers. Gradual decline in the monetary efficiency in the wastewater activity (decreased value for money). Business / Management Long-term financial planning deficient Insufficient funding provision and possible rates increase or deferred expenditure Asset management and LTCCP development Further refinement of asset life forecasting; and asset values MEDIUM The wastewater services are affordable 6 Complete Wastewater Risk Analysis in DM June

49 RISK TYPE RISK EVENT WEAKNESS OR VULNERABILITY MITIGATION STRATEGY STRATEGY TO DEVELOP RESIDUAL RISK PRIORITY LEVELS OF SERVICE IMPACT Financial Issues Errors in financial forecasting Pressure on Capex and Opex and LOS decline or rates increase Certified valuers used. Work audited. Further refinement of asset life forecasting; and asset values MEDIUM The wastewater services are affordable Business / Management Flaws in design / construction of assets Capacity to deliver level of service and / or additional cost incurred or LOS decline Good infrastructure design standards. Good construction supervision. LOW Slow deterioration of level of service delivered to customers. Gradual decline in the monetary efficiency in the wastewater activity (decreased value for money). Business / Management Resource Consents not granted or conditions not met Environmental damage and possible legal action Monitor and report on compliance with consents. Programmed reporting/renewal MEDIUM Legislative compliance. Operation and Maintenance Power supply failure Inability to pump water within the reticulation network resulting in overflow Backup generation LOW The wastewater network will be operated in a manner that protects the public from the risk of disease. Wastewater Activity Management Required renewal or maintenance deferred and not recorded High unplanned maintenance costs and increased service delivery cost Development of a structured Renewals and Maintenance Programme. Renewals and Maintenance Programme MEDIUM The wastewater services are affordable Wastewater Activity Management Deficient or inadequate incident response planning Slow response to emergency event, reduced LOS and possible health issues Staff trained and properly equipped. Emergency response plans to be developed and practice events to be held with contractor. MEDIUM The wastewater network will be operated in a manner that protects the public from the risk of disease. June

50 RISK TYPE RISK EVENT WEAKNESS OR VULNERABILITY MITIGATION STRATEGY STRATEGY TO DEVELOP RESIDUAL RISK PRIORITY LEVELS OF SERVICE IMPACT Asset Management Asset Risk Register and Risk Plan not implemented Asset failure due to unmanaged identifiable risk. Regulatory action possible; additional costs incurred Complete register and implement risk plan MEDIUM The wastewater network will be operated in a manner that protects the public from the risk of disease. The wastewater service is operated in compliance with regulatory requirements. Reticulation Subsidence due to mining Pipe breaks, increased groundwater infiltration; overflows, and possible public health risks. MEDIUM The wastewater network will be operated in a manner that protects the public from the risk of disease. Wastewater Treatment Plants Flood Plant inoperable with untreated wastewater discharged and possible public health risk Emergency response plans to be developed and practise events to be held with contractor. MEDIUM Protection is provided to the Community and the Environment Pump Stations Flood Pump switchgear damaged and sewer overflows with possible public health risk Emergency response plans to be developed and practise events to be held with contractor. MEDIUM The wastewater network will be operated in a manner that protects the public from the risk of disease. Pump Stations Pump control component failure Pump inoperable, sewer overflows leading to public health and environmental risk Assess critical spares requirement MEDIUM The wastewater network will be operated in a manner that protects the public from the risk of disease. Wastewater Treatment Plants Toxic substance disposed of Disposal of engine oil, chemicals, or other contaminants, Public education on substances that must not be MEDIUM Protection is provided to the Community and the Environment June

51 RISK TYPE RISK EVENT WEAKNESS OR VULNERABILITY MITIGATION STRATEGY STRATEGY TO DEVELOP RESIDUAL RISK PRIORITY LEVELS OF SERVICE IMPACT into wastewater sewer. into the wastewater network that kill the beneficial bacterial that are used in the wastewater treatment plants to treat the water disposed of in the sewer. The wastewater service is operated in compliance with regulatory requirements. June

52 9 LIFECYCLE MANAGEMENT 9.1 INTRODUCTION: THE OBJECTIVES OF LIFECYCLE MANAGEMENT The objective of lifecycle management is the management of assets from conception to disposal whilst meeting levels of service, maximising benefits and minimising whole of life costs. The figure below illustrates the lifecycle stages and the asset management functions relevant to each stage. Figure 9.1: Lifecycle Asset Management Processes Key elements of infrastructure asset management (AM) are: Delivering a defined level of service and monitoring performance; Managing the impact of growth and the decline in service potential by application of demand management and infrastructure investment; Long term management strategies that meet the defined level of service cost effectively; Identifying, assessing and appropriately controlling risks; A long-term financial plan identifying required expenditure and funding sources. The basic premise of lifecycle management is that as an asset ages the cost of operating and/or maintaining that asset increases and the risk of the asset failing increases. The performance of the asset may also decline with age. Therefore, at some point in that asset s life, the cost of continuing to use and maintain that asset will exceed the cost of replacement and/or performance will no longer meet the required level of service. At this point the maximum value has been extracted, and is the theoretical optimal time to replace the asset (Figure 9.2). Figure 9.2: Theoretical example of the optimal time to replace an Asset Source: International Infrastructure Management Manual (2011) P67. The figure illustrates the theory that the cost of operating and maintaining an asset increases as the asset ages. The optimal time to replace the asset occurs when the cost of maintaining the asset (blue line) exceeds the cost of replacing the asset (red line). June

53 In the real-world the benefit-cost decisions around the optimal time to replace the asset are complicated by intangible costs, such as the health and environmental risks in the event of an overflow caused by a service outage. The analysis of the optimal replacement time is therefore not a simple cost-based decision. To manage assets to best meet levels of service at a minimal whole life cost, it is necessary to balance three main programmes of work: The Operations and Maintenance Programme The Asset Renewals Programme The Development Works Programme The following figure further explains these programmes and their relative impact on levels of service. In the right combination these programmes can be combined to provide an optimal level of asset maintenance and renewal. Figure 9.3: Lifecycle Management Work Programmes Operations & Maintenance Programmes Proactive Programmes Reactive Programmes Reactive and proactive maintenance and day-to-day operations ensure efficient operation and serviceability of the assets whilst maintaining levels of service over their useful lives. Asset Renewals Programmes Replacement Programmes Rehabilitation Programmes Renewals programmes allow for the progressive replacement of the asset base to restore assets to their original levels of service e.g. to restore capacity or performance. Replacement costs include from inception to asset disposal. Development Works Programmes Asset Creation Asset Disposal Development works involve the augmentation of assets to improve system capacity and performance where current levels of service are not being met or levels of service are to change. Source: Babbage Consultants Lifecycle Management Report for Hauraki District Council (2012). June

54 9.2 LIFECYCLE MANAGEMENT STRATEGY Hauraki DC s lifecycle management strategy is to maximise the useful and economic lives of its assets. By maximising the lives of the District s assets, the Council is able to reduce the cost of the wastewater service to the community. The primary mechanism that Council uses to maximise the lives of the District s assets is through the management of: The consequential risks of an asset failing; and, The duration, frequency and extent of disruption to the wastewater service due to repair or replacement of an asset. Assets with high failure consequences are rated high criticality, and assets where failure consequences have minimal impact on the community are rated low criticality. The criticality rating process is a part of the Council s Risk Management activity, see Section 8. The asset criticality determines the extent of the risk mitigation undertaken to limit the extent and frequency of any interruption caused by the unexpected failure and/or repair/maintenance of the asset. The risk mitigation measures utilized by the Council are summarised below: RISK MITIGATION VS ASSET CRITICALITY VERY HIGH CRITICALITY AND HIGH CRITICALITY ASSETS: Very-high and high criticality assets are proactively managed to prevent interruption to the wastewater service that would exceed the level-of-service reliability targets; The management process consists of: o Critical assets are monitored throughout their life for performance indicators of a potential premature deterioration in the asset s condition. A database of critical assets is being established that will be used to track repairs and other indicators that might signal that the condition of the asset has deteriorated; o Opportunistic sampling of the condition is carried out if and when such opportunities arise; o Proactive condition assessment is carried out when the asset reaches 80% of its expected life, or if performance indicators suggest premature deterioration of the asset; o Data from asset condition inspections (opportunistic or proactive), will be used to re-project the asset s life, and schedule the next condition inspection. If the inspection finds that replacement is required, the asset will be scheduled for replacement; o Industry information about the various types of wastewater infrastructure installed in Hauraki DC will be referenced where available. Problems with specific types of infrastructure typically manifest themselves with other wastewater operators several years before they become problematic for the Hauraki District because of the young-age of the infrastructure within the District. o Council will document an Interruption Management Strategy within the critical assets database for unexpected failure of each Very-High and High criticality asset. Examples may include asset duplication; carrying spare / replacement parts; or the temporary idling of pump stations within network in order to store the wastewater within the reticulation system while repairs are being carried out. The programming of inspections for Very-High and High criticality assets will be maintained within the critical-asset database that is being created. June

55 MEDIUM CRITICALITY ASSETS: The condition of Medium criticality assets is not proactively monitored throughout the assets life since the consequence of an unexpected failure of a Medium criticality asset is not expected to warrant the cost of proactive monitoring; Instead, the time to repair will be assessed for each Medium criticality asset and stored within the criticality database; Where in the event of a failure of the asset, the wastewater service can continue to convey / treat sewerage, or have capacity reinstated within 4-hours; Medium Criticality assets will be kept in service until: Economics indicate that it is cheaper to replace than repair / maintain the asset; or They can no longer meet the reliability targets specified in the levels-of-service; or The asset s performance has degraded to the point where the Council s performance based level-of-service targets are no longer being met. If the wastewater service will be interrupted in the event of a failure and/or repair; and the asset cannot be repaired or replaced within 4-hours, then: A formal assessment of the asset s condition will be carried out when the asset reaches 80% of its expected life, or if performance indicators suggests premature deterioration of the asset; The condition data will be used to re-project the asset s life, and schedule the next condition inspection or the replacement of the asset; Duplication or replacement will be considered at the first failure of the asset. The 4-hour repair time arises from the Council s Level-of-Service commitment to contain 80% or more of dry weather overflows in less than 4- hours (refer the Level of Service section of the main body of the report). LOW AND VERY-LOW CRITICALITY ASSETS: Low and Very Low criticality assets will be kept in service, repaired and maintained until: Economics indicate that it is cheaper to replace than repair / maintain the asset; or They can no longer meet the reliability targets specified in the levels-of-service; or The asset s performance has degraded to the point where the Council s performance based level-of-service targets are no longer being met. SUMMARY The criticality vs. useful-lifespan process described above enables the Council to maximise the useful lives of its assets, while balancing the risks, costs, and consequences of each asset failing to both the Council and the wider community. June

56 9.3 MANAGING RISK Risk Management is an inherent part of the Council s Lifecycle Management Strategy (described above). However, in order for the Council s Lifecycle Management Strategy to work, other risks also need to be managed. We provide an overview below: REACTIVE MAINTENANCE: MAINTAINING PREPAREDNESS Council s Lifecycle Management Strategy for Medium, Low and Very-Low criticality pipes relies on its ability to carry out repairs and replacement in a timely manner without compromising level-of-service targets relating to reliability and overflows. The Council s levels of service targets stipulate required repair times, and the maximum frequency with which wastewater overflows can occur. In order for the Council be able to repair assets within the stipulated time frames requires a state of preparedness to be maintained. This requires an adequate supply of spare parts and pipes to be stocked; and suitably qualified staff and appropriate machinery to be available. The wastewater asset manager reviews the wastewater treatment plant assets and reticulation assets three-yearly, and ensures: That appropriate suite of pumps, manholes, and pipes of varying sizes, and associated valves and fittings are either warehoused by the Council within the District, or are available under contract within a sufficiently short period of time that the repair / replacement can be completed within 4- hours of notification of failure; Assets with long lead-in times for replacement (eg: months) are identified and reviewed 3-yearly. Spares are either stocked at the Council s depot, or alternatively, the assets are scheduled for proactive condition inspection. June

57 9.4 EXPECTED LIVES As described above, Hauraki District Council s Lifespan Management and Risk Management strategies are reliant on an understanding of the expected lives of the Council s assets. One of the challenges for Hauraki District Council, with its relatively small asset base, is obtaining sufficient data on asset lives. For some assets, such as pipes of a common diameter, and manholes, Hauraki District Council has a sufficient number of assets in use that valid statistical conclusions can be drawn from assessments of the existing assets performance. For other assets, Hauraki District Council draws upon the experience of specialists in infrastructure Management who maintain their own databases; or industry standard lives. Figure 9.4: Range of expected useful Asset Lives for Wastewater Pipes Anticipated Life (years) Alkathene Asbestos Cement (AC) Cast Iron Concrete Glazed Earthenware (GEW) Poly Vinyl Chloride (PVC) Polyethylene Reinforced Concrete Steel Steel Cement Lined Unknown Spread of Lives Expected Average Life June

58 MODELLING EXPECTED LIVES Hauraki District Council has developed a statistical model to forecast the expected life of its assets where age is the most likely reason for the asset s future retirement. The model has been used where the Council has a sufficient number of assets to use as a basis for analysis. For the Wastewater AMP and 2015 renewals forecasts, the model has only been used on pipes and manholes. Other assets may be included within the modelling if and when there is sufficient data to calibrate the forecasts. Inputs required for the modelling process include: An industry standard life for the asset (used as a starting point for forecasts); Age of each individual asset; The type, material and size of the asset; The number/length of the assets in use; and, All of the above details for assets that have already been retired within the district. The records on retired assets must include the reason for the asset being retired, to ensure that only age related issues are included in the model for calibration purposes; The model is based on the premise that in a population of assets, each asset does not fail at an exact point in time. Rather, failures are spread over time; with some assets failing early and some performing satisfactorily well past the average lives of the other assets. Hauraki s model assumes a normal statistical distribution of actual service lives over the entire asset population, and that the actual service life of each individual asset will be normally distributed about the average life of the asset population. As a set of assets approaches the end of their expected service life, an increasing percentage of them should have failed early. The statistics behind the normal distribution indicate small percentages of the assets that are expected to have failed early. Eg: 1, 2 or even 3 standard deviations prior to the mean. Council s records of these early failures are used to calibrate the model to re-define the expected service lives of the set of assets. This concept is illustrated in Figure 9.5 and is described in greater detail below. June

59 Calibration of the Model Within the model the expected life of a set (or population) of a particular type of asset is determined by adjusting the average life in the model until the number of asset failures predicted by the model matches the number of assets that have actually already failed. Figure 9.5 illustrates this principle. Within the modelling carried out to-date, assets have been grouped by type (pipe / manhole / pump, etc); material; and diameter, although any desired grouping system is possible. This enables the lives of pipes of different diameters, but the same material, for example, to be individually modelled and adjusted. Limitations of the model: The model can only be used where: There are enough assets with which to form valid statistical conclusions; The asset set already has a small percentage retired due to age-related issues (eg: 2% or more should have been retired). When neither of these two requirements can be met, Hauraki District Council has continued to use an industry standard life, or draw upon work carried out by other Councils in New Zealand that have carried out sufficiently rigorous analysis. The main asset classes, by dollar value, that could not be assessed using Hauraki s Expected-life model were the newer pipe materials, PVC and PE. Pipes made of these two materials are too new to have any age related failures and therefore the model cannot be calibrated. Default industry lives were used in both instances. However, the effect of using industry standard lives is minor, as due to their young age, no PVC or PE pipes are forecast to need replacement within the next 30-years. Principal and Basic Premise behind the model. Figure 9.5: Principal behind forecasts to asset lives Top Figure: In the top figure we illustrate a theoretical pipe asset which has the following parameters: The industry standard life is 80 years; The average age of the asset within the district is 60 years; The standard deviation of the asset life is 15-years; Analysis of this asset using the standard-normal curve shows that 15.8% of the asset should have already failed, or is past its useful life. This does not align with Council knowledge of the asset. The Council has only replaced 4% of the asset to-date. A further 1 % is known to be in poor condition, and has been scheduled for replacement within the next 3-years. Bottom Figure: In the bottom figure we illustrate how the expected life of our theoretical asset is calibrated based on the condition of the asset: As described above, 4% of the asset has already been replaced, and 1% of the asset has used the end of its life and has been scheduled for replacement. This gives a total of 5% of the asset that has reached the end of its useful life. The average life of the asset is increased until the percentage under the normal-distribution frequency curve below 60-years old equals 5%. Adjusting the average life of our theoretical pipe to match the condition of the asset shows yields an increase in the average life of the asset population from 80 to 90 years. June

60 9.5 THE RENEWALS MODEL Once the asset lives have been calibrated the Expected Life model can be and was used to develop a financial forecast of the renewals budget. Forecasts are undertaken using a Monte-Carlo style simulation. The Monte Carlo simulation assigns a random value to each asset. This is then converted into a forecast remaining life by fitting the random value within a standard normal distribution curve defined by the expected life and the standard deviation determined through the model calibration process described in the previous section. Renewals Forecasting In order to forecast funding for renewals, the asset valuation register is coupled to the Expected Life model, enabling the cost of replacing the asset to be budgeted for in the year of forecast replacement. The model carries out these calculations line-by-line for each asset included in the model asset register. The resulting budget forecast is then stored away for later analysis. The Monte Carlo style simulation then runs the model again, assigning a new random value to each asset in the model, resulting in a second forecast of the assets life. Again, the cost of replacing each individual asset is budgeted for in its newly forecast replacement year. These same calculations are carried out on every single asset included in the set being modelled, and when totalled they form a renewals budget for all assets included in the model. This budget is then stored away for later analysis. After the model has been re-run a large number of times, a picture starts to form of the most likely spread in the lives of the assets included in the model. Combined with information about the cost-ofreplacement, the model outputs are turned into a financial renewals budget. Hauraki s Expected Life model was run using 100 iterations of the Monte Carlo style simulation. This produced 100 different renewals forecast budgets. Subsequent analysis of these 100 renewals forecasts reveals the most likely required renewals spend. The 100 renewals forecasts were also used to develop an understanding of the potential spread in the required renewals spending. For example, if a particularly expensive asset were to fail several years earlier than expected, this would cause a spike in the renewals spend for that year. The Monte Carlo style simulation has the benefit that the scenario of that large-expensive asset failing earlier than expected is built into the spread of the forecasts. This is perhaps best explained by review of Figure 9.6, on the page over. Accounting for Assets not included in the Renewals Model As described above the Expected Life model has only been utilised to forecast the end lives of wastewater pipes and manholes in the forecasting carried out for in preparation for the planning cycle. However, the Council s renewals budget also needs to include numerous other assets, such as the subcomponents forming the water treatment plants. For these assets, the wastewater utilities manager has manually prepared a renewals forecast of the anticipated year of replacement. These forecasts were added to the forecasts of the pipe and valve renewals to derive the total renewals budget. The resulting renewals budget, and forecast potential spread in the annual renewals expenditure are presented in Figure 12.5 in the Finance Section of the AMP. What is Monte Carlo Simulation? Monte Carlo simulation, is a technique used to understand the impact of risk and uncertainty in forecasting models. The technique was developed by scientists working on the atomic bomb in the 1940s, who named it for the city of Monaco, famed for its casinos and games of chance. Monte Carlo simulations are particularly powerful when a forecast or estimate needs to be carried out where there is significant uncertainty. The key feature of a Monte Carlo simulation is that it can tell you how likely the resulting outcomes are. This is different from a normal forecasting model, in which you plug some numbers into a formula or algorithm, and you get a single value as the result. For example, a pipe supposed to last 80 years, installed in 1940 would be forecast to need replacement in the year However, chances are that it actually won't fail in the year Instead, it will fail sometime shortly before after this date. This example illustrates how forecasts of the remaining lives of assets are highly uncertain. The Monte Carlo simulation enables the spread of years during which an asset, or group of assets is most-likely to fail. June

61 Figure 9.6: A 30 year forecast of required Pipe and Manhole Renewals expenditure derived from a Monte Carlo simulation of the Expected Lives Model 900,000 Wastewater Condition Based Renewals Forecast - 30-year 800, ,000 Renewal Spend in Period ($) 600, , , , , ,000-95% Upper Quart Lower Quart 5% Average Average (reported values are the forecast renewal spend in 2014 dollars, with no allowance for inflation). The plot presents: The forecast average annual renewals spend for pipes; The 5 and 95 percentile forecasts; and the 25 and 75 percentile forecasts (upper and lower quart) ; When reading the percentile forecasts it is important to understand that the reported figures represent the chance of the renewals spend being that value in any particular year. It would be extremely unlikely for two 95 percentile renewals forecasts to occur back-to-back, for example. The percentile forecasts represent the statistical chance of failure in a single year of a large asset, or the coincidental failure of several smaller assets all occurring within a single year. The percentile forecasts are useful when planning the amount of money the Council should have the contingency to draw upon in any single financial year to cover the risk of a large asset failing; or the coincidental failure of several smaller assets within a 12 month period. 10-year forecast: The renewals forecasts shows the renewals spending for pipe asset increasing to an average of $70,000 p.a. by The forecast shows that there is a 25% chance in the year 2025 that the renewals figure could spike as high as $90,000; and a 5% chance that the renewals figure could spike as high as $140, year forecast: The renewals forecasts shows the renewals spending increasing to an average of $480,000 p.a. by The forecast shows that there is a 25% chance in the year 2045 that the renewals figure could spike as high as $580,000, and a 5% chance that the renewals figure could spike as high as $785,000. June

62 Improvement of the renewals model forecasts Asset data held by Hauraki on its active assets currently fulfils the requirements of the renewals model. However, the renewals model is reliant on good data being held on decommissioned assets. Back in the 1990s and early 2000 s, information about decommissioned assets was as not reliably kept. The wastewater industry had not yet foreseen the extent to which data about retired assets is utilised today for the purposes of good asset management. To address this going forward, guidelines for staff will be formalised to ensure that sufficient and appropriate data is captured and kept when assets are decommissioned. Over coming years, use of the renewals model forecast may extend beyond pipes valves and fittings. Other assets that the Council is considering to include in the life-cycle model are pumps and motors, for example. Records on these shorter lived assets were not as complete as the records held on reticulation assets, particularly in respect of information about decommissioned assets. Council will work to improve the records held with a view towards enabling life-cycle forecasting to be carried out across other asset areas. The larger the number of assets included in the model, the better the forecasts. Council intends to approach other wastewater operators with a view to sharing each other s asset condition data. Keeping the Expected Life - Renewals Model up to Date The key inputs for the renewals model are: 1. The valuation asset register. which must include: a. A description of the each asset (asset type (eg: pipe/manhole/pump); diameter; material; year of install); and, b. The cost of renewing each asset. 2. For calibration purposes, details on assets that have already been retired need to be added as an input to the model. The required details for calibration purposes are essentially the same as those used to value the asset, e.g.: asset type (pipe/manhole/pump); diameter; material; year of install; year of retirement; reason for retirement. a. Note that the reason for retirement does not to need to be added to the expected life model. Instead, this data is used to filter out assets that were replaced for reasons other than old age. For example, a pipe that was replaced early because it was too small. Assets replaced for reasons other than old age or poor condition should not be included in the model for calibration purposes, as they would bias the calibration. The process to update the model is summarised below: 1. Update the model with the latest valuation data, as described above. 2. Update the model with the latest data held on assets retired due to old age/poor condition. 3. Adjust the expected life, and spread within the expected life parameters for each asset class. (Asset class being: pipes grouped by material and diameter, for example). The goal of the adjustment is to align the number/length of assets forecast to have needed replacement with the actual occurrence of replacement. a. Note, as described above, where insufficient data exists on the number/length of assets that have already been replaced, use of standard industry lives is recommended. 4. Update the range of years for which forecasts are required. E.g.: between 2018 to Run the Monte Carlo simulation, by pressing the macro button in the spreadsheet model. June

63 9.6 OPERATIONS AND MAINTENANCE The objective of the operation and maintenance activities is to maintain and operate the system such that the performance and reliability targets of the wastewater levels-of-service are met. The present level of maintenance and operation is sufficient to meet these targets. OPERATION AND MAINTENANCE STRATEGY Hauraki District Council s operation and maintenance strategy is to make informed decisions based upon data. The strategy relates not just to the operation and maintenance activity, but data captured through the operation and maintenance activity being used to support larger and longer-term decisions around capital investment and asset renewal. MONITORING COMPLIANCE WITH LEVEL-OF-SERVICE TARGETS AND LEGISLATIVE REQUIREMENTS The wastewater asset manager is required to report to the Council s senior management team quarterly on performance and reliability level of service targets and legislative compliance. Annual reporting is required for measures that only change slowly over time. The details of what is reported, how frequently it is reported, and how it is measured are described in full within the Level-of-Service and Performance Measurements section of the main body of the AMP. PROACTIVE OPERATION AND MAINTENANCE In a top level down approach: the quarterly reporting process outlined above enables the wastewater asset manager, and Council management to identify any issues that are arising with the wastewater activity and address them in a timely manner. In a bottom level up approach: maintenance issues identified by operators and field staff are logged with the wastewater asset manager. This enables the asset manager to assess and prioritise the response to such issues. Centralising maintenance in this manner, helps to keep track of larger issues that may be developing, and prevent excessive reliance on reactive maintenance. REACTIVE MAINTENANCE Reactive maintenance is primarily handled through the Customer Service Request system. The customer services team are trained to assess the relative priority of the customer s request. Urgent requests are sent to the Council s field staff for immediate action. Non-urgent requests are filed with the wastewater asset manager in a similar manner that field staff lodge identified non-urgent maintenance. Again, this enables the asset manager to assess and prioritise the response. FORWARD IMPROVEMENTS Over the next three years Hauraki DC will be placing an emphasis on streamlining and improving the collection of data about the operation and maintenance activities carried out on the wastewater network and treatment plants. Areas for particular attention will be: improving the ability to efficiently measure level of service compliance; track operating costs (eg: electricity, cleaning); track repair and maintenance costs; track asset reliability; spatially present and analyse the data. Emphasis on capturing sufficient data that enables informed decisions to be made. June

64 9.7 ASSET CONDITION AND PERFORMANCE MONITORING Performance relates to the ability of an asset to provide a required level of service the customer. Condition relates to the structural integrity of an asset. STRATEGY Hauraki has adopted a primarily performance based asset monitoring approach. Apart from the asset condition monitoring described within the Lifecycle Management Strategy, asset condition monitoring and assessment is included in the regulatory and overflow targets in the level of service performance criteria: Dry weather overflow targets require proactive maintenance of the pumps and network. Without proactive maintenance, the network overflow frequency would quickly be exceeded by the build-up of fat, roots, and ragging of pump impellors, etc; Regulatory targets require the wastewater to be treated to the standards outlined within the resource consents. They also regulate that wastewater overflows are not a permitted activity, and therefore cannot be a part of the normal or designed operation of the wastewater sewer; A wastewater asset that is in poor condition or poorly maintained will fail to meet the regulatory and reliability performance targets specified in the levels of service. MONITORING PERFORMANCE Flow gauging and calibrated hydraulic models of the wastewater network are used to monitor the condition, demand and capacity of the network. The structural condition of a wastewater network can be inferred from its water-tightness. A wastewater network that is poor condition will respond to rainfall in a manner similar to a stormwater network. Groundwater ingress may occur up to the entire capacity of the pipes. Where demand caused by rainfall or groundwater has increased to excessive levels, then the condition of the pipe network may have deteriorated to a point where renewal or repair is required. The threshold where intervention is required is determined on a catchment-by-catchment basis. The assessment takes into account both the hydraulic capacity of the network within the catchment, and the impact that the flow from the catchment has on downstream catchments. Because of low population growth in the district, the hydraulic models do not need frequent updates in order to remain current. Hauraki s rolling programme sees the catchments flow gauged and remodelled every 10 years. This rolling program allows trends to be identified, and potential issues noted before they become problematic. Hydraulic models are cost-effective in measuring many of the performance measures, because they can also be used to identify and design cost-effective solutions where performance is found to be lacking. The models are also used to design replacements when assets are due for renewal. The customer service requests database is also used to monitor the performance of the network. The customer service requests are reported on quarterly to Council senior management. Any sharp upward trend in complaints is investigated, as it may signal a sudden problem with the network. Longterm trends are tracked and monitored by both the wastewater asset manager and Council management. Deterioration in long-term trends is investigated, as it may indicate deterioration in the performance of the network that needs to be addressed. The Council s SCADA systems are used to identify problems with pump stations and treatment plants, such that maintenance crews are alerted to the problems before sewerage overflows occur. The Council s SCADA system is working well in this regard. June

65 Proactive maintenance work carried out by Council s field staff is also monitored. Systems are being established to digitally map the location and frequency of maintenance works within the pipe reticulation. Over time this data should start to form a useful tool to monitor the performance and cost of maintaining problem-spots within the network. The Council s resource consent conditions specify specific measurements required to demonstrate compliance. These measurements are carried out, and reported to the Waikato Regional Council as stipulated within the resource consent conditions. OPPORTUNISTIC CONDITION BASED SAMPLING Hauraki DC s Lifecycle Management Strategy does not require proactive asset condition monitoring for Medium criticality, Low and Very Low criticality assets. The reasons for this are largely twofold: i. The cost exceeds the benefit for assets with these lower levels of criticality; ii. Because of Hauraki District Council s small size, a sub-sample of our already small asset base will have too few assets with which to draw valid conclusions from. However, over recent years Hauraki District Council has carried out opportunistic condition based sampling. The results of this initial work were considered beneficial, and obtained at relatively low cost. Opportunistic condition sampling opportunities present themselves when assets are already exposed for extensions, maintenance, or repair. Over the next 3 years, Hauraki District Council will investigate the merits of implementing an opportunistic condition based sampling program. Results would be stored in a spatial database. The intended use of this condition data is to help refine the accuracy of forecasts of the expected lives of the District s assets. June

66 9.8 RENEWAL Council will continue to renew assets to sustain agreed levels of service targets and meet regulatory requirements. Prior to commissioning a renewal, Council will assess whether the need for the asset remains. If no ongoing need is identified, the asset will be decommissioned and not renewed. Assets are renewed on the following basis: Performance: o The existing asset is not and cannot (with modification) meet the required performance level of service targets and/or regulatory requirements; Reliability: o A Very High or High criticality asset has reached the end of its useful life, and is being replaced to ensure the continued reliability of the service; o A Medium criticality asset that is time consuming to repair or replace has failed and has therefore been scheduled for replacement; o A Very Low, Low, or Medium criticality asset has reached an age where it has started to fail at a frequency that exceeds the reliability targets specified within the levels of service. Economic: o The asset has become uneconomic to maintain and operate; and net present value analysis (NPV) has shown that it is cheaper to replace the asset with a modern equivalent. o NPV analysis shows that a more modern asset has an operating cost is sufficiently lower than the existing asset to justify the replacement of the aged asset; Obsolescence: o The asset has become obsolete and needs to be replaced in order to integrate with wider Council systems; Opportunistic: o Where other activities or maintenance has been carried out in the vicinity of an asset that is nearing the end of its economic were useful life, assets may be replaced prematurely to tie in with those other activities or maintenance been carried out. An example would be a pipe buried underneath the road that is about to be dug up for repair. In this circumstance it may be cheaper to renew the pipe while the road is being repaired. o Opportunistic renewals will only be carried out when it is determined that premature renewal of the asset to coincide with the other activities or maintenance is likely to be the cheapest long-term option. Opportunistic renewals are assessed on a case-by-case basis. IDENTIFICATION OF RENEWALS With the exception of opportunistic renewals, the data capture and analysis process described within the operations and maintenance section (Section 9.6); and the 10 year rolling flow gauging and modelling programme described within the Demand Management section (Section 7) are used by Council to identify assets that require renewal for one of the reasons listed above. Opportunistic renewals are currently identified through an ad hoc process, predominately facilitated by departmental and interdepartmental team meetings, or offers from external agencies. June

67 LONGER TERM RENEWAL FORECASTS Longer term renewal forecasts are based upon the expected lives of the assets. The asset criticality is assigned to each asset within the Council s asset register. The safety margin applied to very high and high criticality assets reduces the forecast useful life of these assets. Where sufficient data exists, the Council s annual forecasting model will be used to simulate the period when each asset is forecast to fail. The use of a Monte Carlo simulation enables an average renewals forecast to be derived, and the confidence intervals around the forecast to be understood. SELECTION OF AN APPROPRIATE REPLACEMENT Because reticulation assets are long-lived, hydraulic models of the wastewater network are used to ensure that the replacement pipe is sized correctly to meet the needs of current and future generations over the life of the asset. As treatment assets usually are part of a larger plant, they are usually replaced like-for-like, unless a new technology has been developed that supersedes the existing asset. In this circumstance, and where the economics justify the investment, the plant may be modified to accommodate the newer technology. RECENT ASSET RENEWALS Council has recently commenced the renewal of the pumpstation controllers, sensors, and ancillaries. This renewal replaced assets which were near reaching the end of their economic life, with newer technology that will facilitate better monitoring of the performance of the pump stations in the district. A section of the Victoria Street rising Main was augmented due to hydraulic limitations. Obsolete SCADA systems are being renewed due to technological obsolescence. The new SCADA systems enable remote control and monitoring, and improve data collection on the treatment plants and pump stations. The improved monitoring will help the Council meet and exceed its overflow frequency targets, and improve the Council s ability to continue to meet the resource consents specifying the discharge parameters of the wastewater treatment plants. PLANNED ASSET RENEWALS Significant planned renewals within the next six years include: Treatment Plant renewals: o Waveband renewals; o Pond desludging; o Completion of the SCADA upgrade; Reticulation renewals (Note: this work is subject to further investigation confirming the scope and necessity: o Manhole repair / renewal in the Bank Street catchment within Waihi. The driver for this work is to remove excess groundwater identified through flow gauging studies; o Pipe and manhole repair / renewal in the Waimarei South catchment in Paeroa. The driver for this work is to remove excess groundwater identified through flow gauging studies; o Public and private lateral, manhole, and pipe repair / renewal in the Taylors Avenue catchment in Paeroa. The driver for this work is to remove excess rainwater ingress during heavy rainfall that has been identified through flow gauging studies; June

68 9.9 CREATION AND ACQUISITION Because there is near zero population growth within the Hauraki District, the wastewater activity is largely being maintained in a maintenance of existing service mode of operation. ASSET CREATION AND ACQUISITION POLICY Council policy requires a business case to be prepared for the creation or acquisition of any new significant assets. The business case must: show that the proposed asset represents good value for money for both households and businesses over the anticipated life of the service; and, Consider the risks that surround the creation or acquisition of the asset. When calculating the value over the life the asset, the operating costs of the asset are considered using NPV analysis. This means that an asset with a lower initial outlay, may not necessarily be the chosen option, if the subsequent on-going operating costs are high. IDENTIFICATION OF THE NEED FOR ASSET CREATION The primary drivers for the creation of new assets are foreseen to be: i. new residential housing and commercial developments; and ii. new assets required to continue to meet or lift substandard performance to a level that meets level of service targets. In respect of new housing and commercial developments, most of the required new infrastructure is built and paid for by the land developer. This infrastructure is then subsequently vested with Council. The District Plan details where new residential and commercial development is allowed to take place. In doing so, the District plan prevents ad-hoc growth within the district. This ensures that appropriate infrastructure can be provided to areas designated for new development. In some cases, the connection of new properties to the wastewater network will require upgrades to the existing infrastructure such that it may support the new development. The additional capacity provided by such upgrades is funded from a financial contribution from the developer to the extent that it is needed to serve the development itself. Beyond this development contributions can be utilised to create additional capacity. Upgrades of this nature also provide an opportunity (where necessary) to improve the level of service delivered to existing customers. Any increase to the level of service of existing customers facilitated by such upgrades would be funded by Council subject to the necessary public consultation. In respect of new assets required to continue to meet, or lift substandard performance to a level that meets level of service targets; these assets will be identified through the data capture and analysis processes described within the operations and maintenance section (Section 9.6). Newly created assets are sized to meet the needs of both current and future generations over the life of the asset. June

69 10 STRATEGIC PRIORITIES Hauraki DC s strategic priorities over the past 3-years remain largely the same as the next 3-years. That the strategic priorities remain the same for the following 3-years is positive because it helps to show that: The Council is following its long-term strategy; The Council is working in a pro-active style of operation; Council expects to deliver on several of the strategic priorities set out in the 2012 AMP over the next 3- years. The 2015 AMP also introduces new strategic priorities as described below: 10.1 STRATEGIC PRIORITIES PAST 3-YEARS Understand the long-term wet weather leakage and demand characteristics throughout the wastewater networks of Paeroa and Waihi, by undertaking long-term (12-months plus) detailed catchment flow gauging. Plug missing data on manhole and pipe assets through a field data capture and verification exercise. Field work to be carried out in the townships of: Ngatea, Kerepehi Turua, Paeroa and Waihi (field survey complete, data post-processing is underway). Renew the pumpstation controllers and sensors, cabinets and ancillaries that have reached the end or near end of the economic life. Replacements will be with modern equivalents that will improve data collection, and thereby present opportunities for improved operational efficiency within the network (underway). Upgrade the aged telemetry systems to a modern equivalent (underway); Digitise (where sensible) field-data capture where manual methods are currently used (underway) STRATEGIC PRIORITIES NEXT 3-YEARS Completion of the five priorities listed above within the next 3-years; Understand the long-term wet weather leakage and demand characteristics throughout the wastewater networks of Kerepehi and Ngatea, by undertaking long-term (12-months plus) detailed catchment flow gauging. Develop an understanding of the built-capacity throughout the wastewater networks, through hydraulic modelling; Develop an understanding of utilisation of capacity throughout the wastewater networks, through hydraulic modelling; Plus, the following strategic objectives which have a 6-year target timeframe: Work towards reducing the excess groundwater infiltration where it is occurring; Work towards reducing excess infiltration of heavy rainfall, where it is occurring; Improve the resilience and overall capacity of the network through the strategic removal of capacity bottlenecks within the system; Standardise, as far as possible, the submersible pumps used throughout the district in reticulation pump stations. This will ease and speed maintenance, and reduce the requirements to hold numerous spare parts. Improve the efficiency of in-office information management: o The flow of data from the field to office, and office to field; o Asset data capture; o Tracking of costs against an asset, or group of assets; Improve the measurement of Council s delivery of level-of-service to customers; Improve data held on asset condition. June

70 11 KEY PROJECTS The Council s key projects over the past and coming 3-years are focused on delivering on the Council s Strategic Priorities described in the Section above KEY PROJECTS PAST 3-YEARS The key projects and their linkage to the strategic priorities of Council are listed below: Investigate treatment plant pond sludge depths and determine when desludging will be required (complete); Upgrade Kerepehi WWTP instrumentation (complete); Upgrade of ageing SCADA systems (underway); Renew the pumpstation controllers and sensors, cabinets and ancillaries that have reached the end or near end of the economic life (underway) Field data capture and verification of manhole and pipe data in the townships of: Ngatea, Kerepehi Turua, Paeroa and Waihi (complete). Data post-processing of field-data is currently underway. Upgrading telemetry systems (underway); Provide field-staff with mobile electronic devices that enable them to enter and receive field-data directly into the devices. This eliminates the inefficient double-handling of information which used to be typed into computer systems from hand-written notes (underway) KEY PROJECTS NEXT 3-YEARS Completion of all active projects listed above within the next 3-years, Carry out long-term detailed catchment flow gauging in Kerepehi and Ngatea; Replace damaged sections of the Kerepehi and Paeroa wastewater treatment plant pond wave protection; Hydraulic model build and calibration of the Paeroa and Waihi wastewater networks. System performance analysis and options assessment of the Paeroa and Waihi wastewater network, using the hydraulic model. Plus, the following key projects which have a 6-year target timeframe for completion: Carry out performance based renewals as described below: o Waihi, Banks Street catchment: renewal / repair of manholes to eliminate excessive groundwater infiltration. o Paeroa, Waimarei South catchment: renewal / repair of manholes and pipes to eliminate excessive groundwater infiltration; o Paeroa, Taylors Avenue catchment: renewal / repair of public and private laterals, manholes and pipes to eliminate excessive heavy rainfall infiltration; o Note: it is intended that these three projects will be further refined and scoped by the hydraulic models that will be developed. Removal of priority bottlenecks in the network capacity identified through the hydraulic modelling process; Supporting works, as required, to facilitate the standardisation of submersible pumps used in reticulation pump-stations. June

71 Improve the efficiency of in-office information management. (Details are yet to be scoped, however, current objectives are): o Improved cost allocation against assets; o Improved office to field, and field to office data integration; o Improved systems around asset data capture; o Improved customer service request job-management. Improving the reliability and resilience of the network: o Review of preparedness to repair interruptions to the wastewater service within the target timeframes outlined in the Levels of Service. Improving the measurement of Council s delivery of level-of-service to customers: o Improved customer service request job-management (as listed above). Improved data held on asset condition: o Work with other Councils with a view towards data sharing; o Development of internal procedures in respect of data capture on asset condition; o Training of staff on asset condition data capture. June

72 12 FINANCIAL FORECASTS & MANAGEMENT Financial management in asset-intensive organisations is characterised by high asset values relative to the total value. The financial management principles important to these types of organisations are: Consumption of asset service potential Categorising expenditure appropriately Allocating costs to appropriate assets Preparing long-term forecasts Cost-effective financing Effective reporting of financial performance The figure below provides a representation of the accumulation of costs over the total lifecycle of an asset. Figure 12.1: Long-Term Lifecycle Asset Expenditure The figure shows how initial up-front capital costs often dominate the decision-making process when acquiring new assets. Recurring and ongoing expenditure usually represent a high proportion of the total lifecycle costs of many assets (e.g. depreciation, loan, interest, overheads etc.). June

73 Financial and asset management should complement each other in a symbiotic relationship rather than there being a demarcation between the activities 7. Asset and financial management systems interface at the following areas: Asset classification and asset hierarchies Asset management may require greater detail but the Asset Management System (AMS) hierarchy will be the same or align with the fixed asset register Finance System (FS). Categories of asset expenditure and capitalisation rules There should be agreement about the capitalisation and categories of expenditure in both the AMS and FS systems. Asset revaluations and depreciation charges Replacement and carrying value (book value) of assets forms a significant proportion of the assets on the balance sheet. Depreciation expenditure also forms a large part of the operational costs in financial budgets. Similar unit rates, asset lives and depreciation methods are followed. Costing levels of service Service levels costs are robustly calculated and expenditure projections by asset managers are used by financial staff to perform the calculations. Lifecycle costing and feasibility analysis Lifecycle costs are considered as part of the benefit-cost analysis when a new project or acquisition is evaluated. 7 IIMM 2011, Section June

74 12.1 LINKAGE BETWEEN THE FINANCIAL PLAN AND COMMUNITY OUTCOMES The model below illustrates the links between community outcomes, levels of service, funding, lifecycle expenditure and future or required levels of service and key performance indicators. Figure 12.2: Levels of Service/Lifecycle/Expenditure Relationship Community Outcomes & Well Being Optimising Life-Cycle Service Level Current Service level Current Funding Level Resource Assessment Capital & Operational Expenditure Future Funding Level Future Service Level Current Customer KPI s Current Technical KPI s Life-Cycle Analysis Minimum 10 Year Planning Period Target Technical KPI s Target Customer KPI s Optimising Life -Cycle Cost Life-Cycle Lifecycle Planning Period If a higher service level is provided to the consumer it should translate into improved customer satisfaction and therefore will impact on community outcomes and well-being. However, higher levels of service will usually require additional capital or operational expenditure. Increased expenditure will likely flow through to a need recoup the additional cost through higher charges to the consumer. For this reason, there is a balance to be struck between the level of service provided, and the cost of the wastewater service. June

75 12.2 FEES AND CHARGES The fees and charges are updated as part of the LTP process the reader is directed to the current Council Annual Plan to review the current fees and chargers relevant to the wastewater. The current Annual Plan document is available on the Council s public website. The Council s current funding approach for wastewater is:- Operating costs are funded almost entirely by a scale of pan charges.. Every separate household that is connected to a public system pays a standard uniform charge, irrespective of the number of pans. Commercial and industrial properties pay a charge per pan connected, but the charge per pan reduces progressively the more pans that there are. The current charging structure is: Properties that are capable of being connected, but which are not connected, and which are located within 300 metres of a wastewater main, pay a half charge Table 12.1: Commercial and Industrial Wastewater Charges COMMERCIAL SERVICE LEVEL Up to and including 2 pans Up to and including 4 pans Up to and including 6 pans Up to and including 8 pans Up to and including 10 pans Up to and including 15 pans Up to and including 20 pans Over 20 pans CHARGE See current annual plan. See current annual plan. See current annual plan. See current annual plan. See current annual plan. See current annual plan. See current annual plan. See current annual plan. June

76 12.3 DETAILED 10 YEAR FINANCIAL PLAN The 10 year plan for all renewal and capital renewals are outlined in detail in Table 12.2 and Table The total new-capital expenditure between 2015 and 2025 is $1.6m. The total renewal expenditure over the same period is $6.6m OPERATIONS & MAINTENANCE EXPENDITURE The operational and maintenance cost for the past 3 years, and next 10 years is presented graphically in Graph 7.1. The chart represents forecast expenditure of approximately $33m between 2015 and 2025 (2014 dollars). Figure 12.3: Forecast Maintenance and Operating Costs 2015/25 ($million) (reported values are the operation and maintenance spend in 2014 dollars, with no allowance for inflation). June

77 Table 12.2: Summary of Operational & Capital Expenditure and Revenue Forecast IN 2014 DOLLARS ($000) ACTUAL FORECAST OPERATING EXPENDITURE DOLLARS Treatment $547 $540 $524 $585 $578 $578 $578 $596 $575 $581 $582 $582 $604 $582 Reticulation $160 $130 $114 $137 $81 $81 $81 $81 $81 $81 $81 $81 $81 $81 Other $150 $181 $287 $248 $286 $236 $226 $216 $216 $216 $216 $216 $216 $216 Fixed Costs $87 $86 $145 $105 $175 $175 $175 $175 $175 $175 $175 $175 $175 $175 Major Maintenance $1 $0 $15 $56 $128 $118 $96 $71 $58 $58 $56 $51 $58 $58 Pumpstations $261 $239 $215 $259 $254 $254 $254 $254 $254 $254 $254 $254 $254 $254 SUB TOTAL $1,206 $1,175 $1,300 $1,390 $1,501 $1,441 $1,410 $1,393 $1,359 $1,365 $1,364 $1,359 $1,388 $1,366 Depreciation $1,183 $1,198 $932 $1,213 $965 $965 $965 $965 $965 $965 $965 $965 $965 $965 Interest $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 Total Operating $3,595 $3,548 $3,532 $3,993 $3,968 $3,848 $3,784 $3,750 $3,683 $3,695 $3,694 $3,683 $3,740 $3,697 CAPITAL EXPENDITURE DOLLARS Capacity Demand Increases $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 Level of Service Increases $670 $110 $0 $0 $0 $0 $800 $0 $0 $0 $0 Renewals $1,584 $1,313 $1,475 $824 $366 $266 $179 $268 $88 $159 $145 Other Capital Expenditure $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 Total Capital $0 $0 $0 $2,254 $1,423 $1,475 $824 $366 $266 $979 $268 $88 $159 $145 TOTAL EXPENDITURE $3,595 $3,548 $3,532 $6,247 $5,390 $5,322 $4,608 $4,117 $3,949 $4,674 $3,961 $3,771 $3,899 $3,843 June

78 Table 12.3: Summary of Operational & Capital Expenditure and Revenue Forecast INFLATED ($000) ACTUAL FORECAST OPERATING EXPENDITURE - INFLATED Treatment $547 $540 $524 $585 $605 $636 $660 $701 $699 $730 $756 $784 $845 $847 Reticulation $160 $130 $114 $137 $85 $90 $93 $96 $99 $102 $106 $110 $114 $118 Other $150 $181 $287 $248 $299 $260 $258 $254 $262 $271 $280 $291 $302 $314 Fixed Costs $87 $86 $145 $105 $183 $193 $200 $206 $213 $220 $227 $236 $245 $254 Major Maintenance $1 $0 $15 $56 $134 $130 $110 $83 $70 $72 $73 $68 $81 $84 Pumpstations $261 $239 $215 $259 $266 $280 $290 $299 $309 $319 $330 $342 $355 $369 SUB TOTAL $1,206 $1,175 $1,300 $1,390 $1,572 $1,587 $1,611 $1,639 $1,651 $1,713 $1,772 $1,831 $1,941 $1,986 Depreciation $1,183 $1,198 $932 $1,213 $1,010 $1,062 $1,103 $1,136 $1,172 $1,211 $1,254 $1,300 $1,350 $1,403 Interest $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 Total Operating $3,595 $3,548 $3,532 $3,993 $4,154 $4,236 $4,325 $4,414 $4,475 $4,638 $4,798 $4,961 $5,233 $5,376 CAPITAL EXPENDITURE - INFLATED Capacity Demand Increases $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 Level of Service Increases $670 $115 $0 $0 $0 $0 $1,004 $0 $0 $0 $0 Renewals $1,584 $1,374 $1,624 $942 $431 $323 $224 $348 $118 $223 $211 Other Capital Expenditure $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 Total Capital $0 $0 $0 $2,254 $1,489 $1,624 $942 $431 $323 $1,228 $348 $118 $223 $211 TOTAL EXPENDITURE $3,595 $3,548 $3,532 $6,247 $5,644 $5,860 $5,267 $4,845 $4,798 $5,866 $5,146 $5,079 $5,455 $5,587 June

79 NEW CAPITAL EXPENDITURE Due to their being zero forecast population growth no capital expenditure is forecast to support population growth in the next 10 years. The new-capital expenditure is therefore entirely for level-ofservice upgrades. There are two significant LoS capital expenditure periods programmed in the next 10 years. These are: DAF sludge process upgrade at the Waihi treatment plant; and chemical phosphorus removal at the Paeroa treatment plant. Both upgrades are aimed at lifting the treatment standards at the wastewater treatment plants. Below is a graph profiling the new-capital expenditure for the next ten years. A detailed outline of the new capital expenditure is summarized in Table Figure 12.4: Forecast New Capital Expenditure 2015/25 ($million) Table 12.4: Wastewater Major New-Capital Projects for (2014 dollars) PROJECT YEAR PROGRAMMED COST DESCRIPTION DAF sludge process Waihi Wastewater Treatment Plant 2015/17 $0.5m The tertiary treatment plant (DAF) produces a sludge which is currently discharged back into the wastewater ponds. The ponds have reached their capacity and this project is aimed at providing an alternative solution to sludge management. Chemical Phosphorus Removal Paeroa Wastewater Treatment Plant 2021/22 $0.8m A new consent is require for the Paeroa wastewater treatment process. The timing of the consent coincides with the expected date at which the current gravel beds will no longer be effective. This project is aimed at building an improved filtration process to comply with anticipated consent conditions. June

80 RENEWAL CAPITAL EXPENDITURE As described in Section 9.5 Renewals Model Hauraki DC s renewals model was used to forecast the lives of its pipes and valves, and for other assets the wastewater utilities manager manually prepared a forecast of the assets lives and renewal costs. These two forecasts were combined to produce the renewals model. Hauraki DC s flow gauging programme has identified three catchments that may require renewals work. Two of these catchments have what appears to be excessive groundwater entering them (Banks Catchment, Waihi; and Waimarei South Catchment, Paeroa). The third catchment has had excessive rainwater infiltration measured (Taylor s Ave Catchment, Paeroa). The Taylor s Ave catchment has been programmed for field work to correct the excessive flow. The Banks and Waimarei catchments will be programmed if subsequent hydraulic modelling confirms the necessity of field work to correct the situation. In anticipation of required works, budgets have been allocated for either renewal works in the Banks and Waimarei Catchments, or alternatively catchment augmentation to increase downstream capacity, if hydraulic modelling shows this to be the preferable option. These projects are categorised as performance-based level-of-service renewals in Figure Table 12.5: Wastewater LoS performance based Renewal-Capital Projects for (2014 dollars) PROJECT YEAR PROGRAMMED COST DESCRIPTION Waihi Bank s Street Catchment LoS Manhole Renewal 2015/18 $0.5m Initial investigations show very high levels of groundwater ingress in this catchment. The pipe work appears to be in good condition. However, the jointing between the manhole risers and pipes appear to be allowing the large volumes of groundwater in. Budget is to either stop the groundwater entering, or carryout augmentation downstream, in order pass the groundwater to the wastewater treatment plant. Hydraulic modelling will be used to confirm options. Taylor s Ave Catchment LoS Renewal 2015/18 $1.7m Initial investigations show very high levels of direct rainwater ingress in this catchment. The pipe work is structurally in good condition, however the pipe joints are largely all displaced. Initial investigation into the laterals shows similar issues to the public sewer. Budget is to carry out complete renewal of the public sewer and laterals in the catchment. Waimarei South Catchment LoS Renewal Irrigation block renewal Whiritoa Wastewater Treatment Plant 2015/18 $0.4m Project as per Waihi Bank s Street Catchment. 2015/17 $0.3m The Whiritoa wastewater is disposed of to a forest irrigation block. The current block requires expensive maintenance every 5-7 years. This project is aimed at replacing those trees with a low maintenance alternative. Pond desludging district wide $0.9m $0.9m Sewage treatment ponds fill with sludge over time. This reduces the treatment capacity of the ponds. This project is to remove the sludge to ensure that the ponds continue to operate within their consented limits. June

81 Because of the uncertainty around the actual useful life of each asset, the renewals forecast has been prepared using a Monte Carlo style simulation for the pipe and valve renewals model. The use of a Monte Carlo simulation for the pipe renewals has meant that the likelihood of either major (expensive) assets failing in any one year, and the consequential effect on the renewals expenditure for those years can be assessed. Similarly, the Monte Carlo simulation also allows for the statistical likelihood of a large number of minor (low cost) assets to fail in any one year to be assessed. These potential eventualities are encompassed within the confidence bands presented below in Figure Figure 12.5: 30 year Renewal Expenditure Forecast ,000,000 1,800,000 1,600,000 1,400,000 1,200,000 1,000, , , , , / Renewal Spend in Period ($) % Upper Quart Lower Quart 5% Condition Based Renewals Performance Based Renewals (reported values are the forecast renewal spend in 2014 dollars, with no allowance for inflation). The plot presents: The forecast average annual renewals spend; The 5 and 95 percentile forecasts; and the 25 and 75 percentile forecasts (upper and lower quart) ; When reading the percentile forecasts it is important to understand that the reported figures represent the chance of the renewals spend being that value in any particular year. It would be extremely unlikely for two 95 percentile renewals forecasts to occur back-to-back, for example. The percentile forecasts represent the statistical change of failure in a single year of a large asset, or the coincidental failure of several smaller assets all occurring within a single year. The percentile forecasts are useful when planning the amount of money the Council should have the contingency to draw upon in any single financial year to cover the risk of a large asset failing; or the coincidental failure of several smaller assets within a 12 month period. A confidence interval was also produced for the manually derived renewals forecasts, based upon the Binomial Distribution. The binomial formula was used to calculate the chance that fewer or greater than expected renewals would occur in each year. As for the pipe renewals model, these likelihoods were calculated for the 5%ile, upper and lower quartile, and 95%ile confidence bands. The confidence bands from both the pipe and valve renewals model and the manual renewals forecast were combined to produce the overall confidence bands presented above in Figure June

82 12.4 DEPRECIATION The three yearly valuations of wastewater assets have been performed by Opus International Consultants with data taken as at 1 July Both underground infrastructure assets e.g. pipes, manholes etc. and above ground assets e.g. treatment plant assets, pump stations, structures etc. have been valued. The annual depreciation for each asset at an asset component level was also calculated ANNUAL DEPRECIATION FOR NEXT 10 YEARS The depreciation was recalculated in line with the 2014 HDC Infrastructure Valuation. Depreciation impacts on the total operating expenditure for wastewater as depreciation is treated as an operating cost. Council fully funds its operating costs so these changes in depreciation have an impact on the operating funding levels. The Table 12.6 and 12.7 (page over) present the Optimised Replacement Cost (ORC), the Depreciated Optimised Replacement Cost (ODRC) and the Annual Depreciation Cost (AD) for the wastewater systems and assets. Figure 12.6 presents the current forecast renewal expenditure relative to the depreciation charged against the wastewater assets. Figure 12.6: Depreciation vs Renewal for the next Ten Years ($million) $5.0 m $4.5 m $4.0 m $3.5 m $3.0 m $2.5 m $2.0 m $1.5 m $1.0 m Renewals (inflated) Depreciation (inflated) $0.5 m $0.0 m 2015/ June

83 The table below provides a summary of the values of Reticulation Assets for each wastewater system and the annual depreciation calculated as part of the valuation. Table 12.6: Valuation Summary of Reticulation Assets 2014 ASSET QUANTITY OPTIMISED REPLACEMENT COST 1 ($ million) FAIR VALUE 2 ($ million) ANNUAL DEPRECIATION ($000) Gravity Sewers 128 km Manholes 2, Laterals 6, Inspection Points Rising Main 30 km Total The table below provides a summary of the values of Above Ground Assets (including intakes) for each wastewater scheme and the annual depreciation calculated as part of the valuation. Table 12.7: Valuation Summary of Above Ground Assets 2014 ASSET QUANTITY OPTIMISED REPLACEMENT COST 1 ($ million) FAIR VALUE 2 ($ million) ANNUAL DEPRECIATION ($000) Kerepehi Ngatea Paeroa Turua Waihi Waitakaruru Whiritoa Consents Total June

84 12.5 DEPRECIATION POLICY Council must revalue its assets every three years to assess total network values and to recalculate depreciation based on those new values. Depreciation is an operating expense and must be funded. Depreciation is often referred to as the Decline in Service Potential (DISP) which represents the wearing out of the asset. Alternatively it is the assets inability to continue to deliver service at its original levels. The basic value of an asset reduces in accordance with the wearing out or consumption of benefits over its life arising from use, the passage of time, or obsolescence. This reduced value is called the depreciated value and has been calculated as the depreciable component of the replacement cost proportioned by the ratio of remaining useful life (RL) to economic life (EL) on a straight-line basis. This method provides a reasonable basis for the return of capital over the economic life of the asset. Optimised depreciated replacement cost is given by: ODRC = (Gross ORC-RV) RL/EL +RV 12.6 ASSET USEFUL LIVES & UNIT RATES The Assumptions for Asset Useful Lives and Unit Rates are determined as part of the three yearly asset lifecycle management processes. Unit rates are updated annually as part of the Annual Valuation of new assets created. Recently completed contracts are used to adjust unit rates assumptions. The Depreciation calculation is discussed in the Final Valuation Report 2014 by Opus International Consultants. The annual depreciation is calculated by dividing the depreciable portion of the replacement cost of an asset by its economic life. The annual depreciation is calculated by: D = (Gross ORC-RV)/EL or = (ODRC-RV)/RL June

85 13 LEGISLATION AND BYLAWS Council s authority and responsibility for providing wastewater services are outlined in various government acts and are supported by policies and bylaws. We summarise and note key legislation below: Local Government Act 1974 (sections not repealed in the LGA 2002) The Health Act 1956 imposes a general public health responsibility on Council. The Public Works Act The Building Act Resource Management Act 1991 and amendments; Civil Defence Emergency Management Act 2002; The Climate Change Response Act The bylaws for wastewater are contained in Part 4 of the Hauraki District Council Consolidated Bylaw. Relevant regulations and national standards affecting the wastewater activity are: NZS 4404:2004 Land Development and Sub divisional Engineering NZS HB 4360:2000 Risk Management for Local Government NZS 4404:1981 Code of Practice for Urban Land Subdivision (superseded) NZS 4404:2004 Land Development and Sub divisional Engineering June

86 14 RELEVANT STRATEGIES AND PLANS This AMP is a part of a suite of planning documents, both within the local context of Hauraki District Council, and the wider external context of the Waikato Region. These include: Hauraki District Council: o Asset Management Planning Policy; o Engineering Manual; o Development Contributions Policy; o Operative District Plan and Proposed District Plan; o Annual Plan; o Community Plan; o Long Term Council Community Plan. Waikato Regional Council policies and plans: o Operative Regional Policy Statement; o Proposed Regional Policy Statement; o Operative Regional Plan. The New Zealand Waste Strategy. The New Zealand Government s Sustainable Development Action Plan. We expand on the purpose of some of these documents and plans below: Operative District Plan and Proposed District Plan - Provides a framework for the sustainable management of the natural and physical environment, and assists the Council to carry out its functions in order to achieve the purpose of the Resource Management Act, Operative Regional Policy Statement, Proposed Regional Policy Statement and Operative Regional Plan - The Waikato Regional Council Plan and Policy Statements, developed under the Resource Management Act, 1991, detail how local authorities in the Region must address regional responsibilities under that Act. Discharges of water, wastewater, solid waste, stormwater and land drainage to water and/or air all require resource consents under the provisions of the Regional Plan (at the scale carried out by the Council). Hauraki District Council Consolidated Bylaw - Provides laws applicable only to Hauraki District that in general: protect the public from nuisance; protect, promote and maintain public health and safety; and minimise the potential for offensive behaviour in public places. Water and Sanitary Services Assessment - Consists of an assessment of water supply, wastewater services, stormwater, drainage, cemeteries, crematoria, public toilets and waste disposal. Section 125 of the Local Government Act, 2002, states there is a need to assess these services as they are vital to health and welfare. Development Contributions Policy - This policy makes provision for the Council to collect contributions for development deemed to cause increased demand on Council infrastructure and community facilities. Payment of development contributions by those causing the demand is considered a fair and equitable way of dealing with the requirement for infrastructure and facilities of increased capacity. June

87 15 PLANNING ASSUMPTIONS AND CONFIDENCE LEVELS The Asset Management Plan is a planning tool which sets out the future needs of the consumers and the community, and presents the Council s response to them by way of capital projects and forward planning. This plan is for the next ten years and is therefore based on a number of assumptions which carry varying degrees of uncertainty. These assumptions include financial assumptions such as interest rates on investments, and population projections. Schedule 10 of the LGA prescribes that the key assumptions and risks should be transparent to the community so those reading the Wastewater AMP can accurately interpret the risks and assumptions associated with long term planning. The second part of this section covers the level of confidence with the information this plan is based on. It is not only about the accuracy and confidence with the asset data but also the accuracy of forecasts e.g. demand and financial forecasts etc SIGNIFICANT ASSUMPTIONS AND POSSIBLE EFFECTS The significant assumptions have been identified and are summarised in Table These assumptions and uncertainties represent the approach that has been outlined for the 2015/25 planning window. Council is required to outline any reasons for uncertainty and what the possible effects might be on forecasts for the future in order to transparently show to the community the reasoning behind key decisions and long term planning. June

88 Table 15.1: Summary of Assumptions for 2015/25 LTP and AMPs ISSUE ASSUMPTIONS POSSIBLE EFFECTS Population Growth Rating Unit Growth Levels of Service The population of the District will remain essentially static for the next 10-years, following by a slight decline to There will be a slight increase in the rating units cause by a shift to fewer people per household. Community expectations regarding the level of service Council provides will not significantly change. Population falls: There will be fewer people to pay for the fixed infrastructure asset costs. This may increase the cost of the wastewater service per property. Population growth occurs: new capital expenditure may need to be higher than forecast. Rating unit growth does not occur: fixed costs per property will stay roughly the same as present. Rating unit growth occurs to a greater extent than forecast: fixed costs per property will decrease due to there being a larger number of properties to spread this cost over. Water use figures per person may increase slightly above present levels. Community expectations fall: Council will be able to stretch the existing infrastructure further, possibly translating into a lower cost of the wastewater service. Customer satisfaction levels may increase. Community expectations rise: two potential outcomes: i) Council does not respond to this increased expectation, and continues to provide the same level of service. The likely result would be decreased satisfaction levels. ii) Council responds to the increased expectations, and upgrades infrastructure to meet these expectations. Customer satisfaction with the quality of water provided may remain at present levels, or potentially increase. However, the cost of the wastewater service provided would likely increase per customer. Resource Consents Resource Consents Conditions of resource consents held by Council for the District s wastewater treatment plant discharged will not be altered significantly. At some stage during the next 30- years, the Waikato Regional Council s regional plan will lower the status of wastewater overflows from its current status of Prohibited to either Restricted Discretionary or Discretionary, bringing the Waikato Regional Plan in-line with the Auckland Regional Plan. Conditions are relaxed: little change to the existing operation of Council. In respect of minimising the impact upon the environment, Council would continue to operate the wastewater service in the same manner that is being currently operated, in order to minimise impacts on the environment. Conditions are tightened: Council is forced to upgrade existing infrastructure to meet the new standards. This will raise the cost of the wastewater service provided to customers. Prohibited status remains: Hauraki District Council will need to shorten the useful lives of its pipe and manhole assets. Pipe and manhole renewals will need to be carried out several years earlier than currently forecast. This will increase the rate of depreciation on the wastewater network, which will translate to higher operational costs, and higher charges to customers. The Waikato Regional Council brings the status of wastewater overflows within the Waikato Regional Plan in line with the Auckland Regional Plan at some stage during the next 30-years: no change to the current forecast manhole and pipe useful lives used within renewals and depreciation forecasts, as this scenario has already been assumed within the current renewals forecasts. June

89 ISSUE ASSUMPTIONS POSSIBLE EFFECTS Operating Environment Asset Information Inflation Interest Asset Value There will be no significant changes to Council s operating environment which have not already been planned for, e.g. natural disasters, health epidemics, or changes to legislation. Condition data for assets that have been replaced, or are nearing the end of their useable lives is reliable. The data held of the age, material, and size of the assets within the Council s asset register is reliable. The forecast wastewater specific inflation rates provided by BERL, will provide reasonable representation of the future occurrence of inflation. Interest rates on Term Debt will not change sufficiently to require changes to the management of the wastewater activity. The asset values provided by Council s consultants for the asset valuation is correct within reason. Possible effects caused by changes the operating environment cannot reasonably be foreseen with any degree of confidence. As such, a reactionary approach will be required to these changes. If the asset condition data is unreliable: Forecasts of the condition of other assets and their expected lives may be incorrect. The performance monitoring carried out by Council will over time show up any incorrect assumptions about the accuracy of Council s understanding on the asset condition. If, and once identified, Council s existing processes will accommodate this new information about the asset condition, and projects will be identified and programmed accordingly. Council s financial forecasts would need to be updated to reflect expenditure that is occurring earlier than anticipated. Council s financial forecasts would need to be updated to reflect the different rates of inflation. Interest rates lower: this is foreseen as being highly unlikely, as interest rates are currently at record low levels. If it were to occur, the cost of the wastewater service could likely be provided at a cheaper rate for customers. Interest rates increase: Hauraki District Council has not programmed any nice to have projects. As such, there are no projects within the existing budgets that can be cut, if the levels of service and environmental performance is to be maintained. As no growth is foreseen for the District, increased interest rates will not affect councils growth forecasts, as growth is already zero. The most likely result is that the cost of the wastewater would increase for customers. An alternative may be consultation with the community to reduce the level of service provided, potentially thereby providing some reduction to the cost of the wastewater service to offset the increased financing costs. Asset values were too high: the rate of depreciation allowed for the wastewater asset can be decreased. This would likely translate into a reduced cost charged to customers. June

90 ISSUE ASSUMPTIONS POSSIBLE EFFECTS New Capital Works Costs Renewals Works Costs Asset Life On average, costs of major capital works will not vary significantly from their estimated costs. The asset values provided by Council s consultants for the asset valuation is correct within reason. Approximately 70% of reticulation assets will reach the end of their useful life over a period of 30 years (±15 years either-side of the expected life of the asset). The industry standard lives of non-reticulation assets are correct. Asset values were too low: the rate of depreciation allowed for the wastewater asset will need to be increased. This would likely translate into an increase cost charged to customers. Capital Works costs are cheaper than budgeted: the savings from the reduced cost of works will reduce the loans taken out to finance them. This will follow through to a lower cost of providing the wastewater service. The rates charged for the wastewater service may be able to be reduced accordingly. Capital Works costs are higher than budgeted: increase costs will result in greater borrowing to fund the wastewater activity. Current charges for the wastewater service may need to be increased accordingly. Renewal Works costs are cheaper than budgeted: the savings from the reduce cost of works will reduce the forecast renewals budget. This will follow through to a lower cost of providing the wastewater service. The rates charged for the wastewater service may be able to be reduced accordingly. Renewals Works costs are higher than budgeted: the forecast renewals budget will need to increase accordingly. The cost benefit decisions that trigger the renewals work may need to be re-evaluated. Council may consult with the community in respect of lowering existing level of service targets. If existing level of service targets are to be met, current charges for the wastewater service may need to be increased accordingly. Asset lives are shorter than forecast: renewal works will need to be carried out earlier than scheduled. This will likely increase the current renewals budget. The rates charged for the wastewater service may need to increase accordingly. Asset lives are longer than forecast: Council will be able to defer renewal works. This will likely reduce the current renewals budget. The reduction in the renewals budget may follow through to a reduced cost of the wastewater service, resulting in lower charges to customers. June

91 15.2 DATA CONFIDENCE CONFIDENCE LEVELS ON ASSET CONDITION & PERFORMANCE The wastewater asset register is stored in the Council s AssetFinda database. This asset register, is used to document the condition and performance of every single asset held by the Council, in addition to parameters that describe the physical dimensions of the asset. Council s overall assessment of the data quality is presented in the tables below: Table 15.2: Data Confidence Grading Scale CONFIDENCE GRADE Highly reliable Reliable Uncertain Very Uncertain DEFINITION OF GRADE Data based on sound records, procedure, investigations and analysis, documented properly and recognised as the best method of assessment Data based on sound records, procedures, investigations, and analysis documented properly but has minor shortcomings, e.g. the data is old, some documentation is missing, and reliance is placed on unconfirmed reports or some extrapolation. Data based on sound records, procedures, investigations and analysis which is incomplete or unsupported, or extrapolated from a limited sample for which grade A or B data are available. Data based on unconfirmed verbal reports and / or cursory inspection and analysis. Table 15.3: Overall Data Confidence Rating CATEGORY CONFIDENCE GRADE Quantity Size / Capacity Location Age Base Life Condition Performance Unit Rate Criticality Highly Reliable ü ü ü Reliable Uncertain Very Uncertain ü ü ü ü ü ü June

92 DATA CONFIDENCE IN ASSET CONDITION The Risk and Lifecycle sections of this AMP describes the process that the Council is utilising to build its understanding of the asset condition over time. The priority placed upon collecting asset condition data is dependent upon the criticality of the asset. As described elsewhere in the AMP, the AMP improvement program details the creation of an Asset Criticality Management database that will document asset condition, and inspection data. Over time, the asset lifecycle management strategy will increase the degree to which this database is populated. In doing so, the Council s confidence in its understanding of its asset condition will improve over time. ASSET PERFORMANCE The Lifecycle Management section of this AMP describes that hydraulic models will be prepared and updated for the District s water supplies on a 10 yearly cycle. Most of the District s hydraulic models are now 10 years old, and due for update. Accordingly, model build and calibration projects for the District s wastewater schemes are programmed to be completed over the next three years. These hydraulic models will be used to carry out system performance assessment, and will improve the Council s understanding of the wastewater asset performance. The results from the system performance assessments will be populated within the AssetFinda database Accuracy of Asset Inventory Council has recently carried out assessments of both the accuracy and completeness of its asset data: A data capture exercise on water, wastewater, and stormwater reticulation assets was across large areas of the district between Jan to March This work has shown that the data already held was largely (estimated to be greater than 95%) accurate. The data captured from this exercise is still being processed back in the office, therefore final accuracy values are not yet known. An asset data stocktake was carried out in June 2014 as a part of the asset valuation exercise. All reticulation and plant asset data for water, wastewater, stormwater, and land drainage assets were reviewed through this process. The stocktake found few errors. Those errors that were identified have already been corrected within Council s asset databases. The asset data register is therefore considered to be accurate, as at June Confidence Level on Demand/Growth & Financial Forecasts These confidence ratings presented in the table below have been determined by the asset managers as part of the lifecycle analysis process. Table 15.4 LTP and AMP Data Confidence Ratings CATEGORY Demand/Growth Forecasts Financial Forecasts CONFIDENCE GRADE Highly Reliable Reliable Uncertain Very Uncertain ü ü June

93 16 EFFECTS OF THE WASTEWATER SERVICE The wastewater service has both positive and negative effects on the environmental, social, cultural, and economic well-being of the community. These include: 16.1 ENVIRONMENTAL EFFECTS Table 16.1: Significant Positive, Negative Effects and Mitigations for Wastewater Service POSITIVE NEGATIVE MITIGATION ENVIRONMENTAL A centralised public wastewater service, is easier to monitor than individual private systems. Better monitoring reduces the risks of potential adverse environmental effects. Poorly maintained private wastewater treatment systems can allow untreated wastewater to leak into the environment for years before anyone notices the problem. If a public wastewater service were not provided, an additional 6,000 private wastewater systems would need to be installed in the District. This would greatly increase the risk of environmental problems caused by poorly maintained private wastewater treatment systems. If the ingress of heavy rainfall and / or groundwater becomes excessive, the public wastewater networks can overflow diluted sewerage into the environment, if the network doesn t have sufficient capacity. Application of the Lifecycle Management strategy described within this AMP; combined with the asset knowledge gained through detailed flow gauging and hydraulic modelling of the networks will enable the performance of the network to be tracked over time. Tracking the network performance over time enables trends to be identified, and potential problems to be identified before they occur. Once identified, projects can be developed and programmed to address known issues before they become problematic. ECONOMIC The cost of a public wastewater service is lower than the life-cycle costs of private wastewater systems. When private wastewater systems are used, they require time and effort to maintain. The public wastewater service frees people to focus on other activities. Businesses are able to focus on their core business activities. The public wastewater service allows more intensive use of urban property as space for disposal fields and tanks no longer needs to be allocated within private property. The costs of the wastewater infrastructure can span more than one generation. If not carefully and responsibly managed and apportioned one generation could benefit at the expense of another. Encourage efficient use of water by customers connected to the water supply. Universal water metering Ensuring that appropriate consideration is given to the financial management of the lifecycle costs of the infrastructure, and that the costs are spread fairly across generations. CULTURAL The involvement of Mana Whenua and Tangata Whenua in the management of the wastewater service has helped to create mutual understanding of different cultures beliefs and values, and how those values can be incorporated into the management and operation of the public wastewater service. Potential conflicts between disposal of treated wastewater and cultural values. Involvement and communication with the Mana Whenua and Tangata Whenua in the management of the wastewater service. Education. June

94 POSITIVE NEGATIVE MITIGATION SOCIAL The public wastewater service reduces the risk of waterborne diseases spreading through the community. No negative social effects arising from the provision of a public wastewater service are foreseen SUSTAINABILITY The wastewater activity generally has a positive impact on the social and environmental dimensions of well-being, creating a healthy and productive environment in which communities can thrive. Negative impacts are the cost to provide and operate these services. There is potential for the wastewater network to have a detrimental effect on the environment if it were poorly managed and operated. Hauraki District Council is committed to minimising any detrimental effects of the wastewater activity where possible. The simplest mitigation strategy described in Table 16.1 (above) is to continue to manage demand through the use of universal water metering. Universal water metering encourages efficient use of water by customers connected to the water supply. This in turn reduces the volume of water returned to the wastewater sewer from residents, and commercial enterprises. Hauraki DC already employs universal water metering, and therefore this mitigation strategy is already in place. The Sustainability Policy 2010 was adopted by Council in August This Policy formalises Council s mandate from the Local Government Act 2002 to act in a sustainable manner. The policy requires staff to consider: the social, economic, and cultural well-being of people and communities; the need to maintain and enhance the quality of the environment; and the needs of future generations. when making business and operational decisions. June

95 16.3 RESOURCE CONSENTS Resource consents are required for discharging into natural water or onto land. These are issued by Waikato Regional Council. HDC s wastewater network currently discharges into six water bodies. The Whiritoa scheme discharges into a planted forestry block. Each of these discharges is subject to resource consents. Each of these consents is subject to requirements that restrict the volume of water that can be discharged, and stipulate the water quality parameters the discharged water must meet. Hauraki District Council easily meets the resource consent capacity limits, and with the exception of the occasional spike in some parameters, meets the water quality parameters as well. All of these resource consents are due for renewal within the next six years. There is likely to be significant staff resource and cost associated with renewal of each of these consents. However, Council does not currently foresee greatly increased environmental treatment standards being imposed. If the regional Council were to seek significant tightening of permitted water quality discharge parameters, this could have very significant cost implications for the District. Table 16.2: Resource Consent Capacities and Remaining Lives SCHEME RESOURCE CONSENT CAPACITY AVERAGE DISCHARGE (2013/14) REMAINING LIFE Kerepehi 834 m3/day 190 m³ 5 Ngatea 6,050 m3/day 300 m³ 1 Paeroa 4,000 m3/day (dry weather) 2,650 m³ 6 Turua 250 m3/day 100 m³ 4 Waihi 4,000 m3/day 1,480 m³ 6 Waitakaruru 75 m3/day 20 m³ 5 Whiritoa 392 m3/day 60 m³ 5 June

96 17 IMPROVEMENT PROGRAMME IMPROVEMENT PROGRAM The primary focus of this improvement programme for the period between is to improve the efficiency of the data management processes that support the asset management planning activity. The period will also see asset management improvement projects being started with a view towards completion in the period. The primary focus of these longer-term projects is to improve the data captured from the field about the behaviour and performance of the wastewater asset. Figure 17.1: Continuous Improvement Process Table 17.1: Asset management improvement initiatives for the period ASSET MANAGEMENT FUNCTION IMPROVEMENT Improve the ability to forecast asset life and identify performance based renewals Asset life-cycle risk management Reactive maintenance: improving preparedness Accuracy and completeness of asset data IMPROVEMENT ACTION Create and maintain a database that documents the location, dates of pipe collapse / partial collapse / breaks / failures, and the failure mode. Formalise the use of opportunistic sampling and condition assessments. Carry out staff training (as required) to support this initiative. Prepare a guide on what data needs to be captured when decommissioning and asset, and how this data is to be stored. Establish and populate an asset criticality database; Schedule inspection dates as required by asset criticality; Medium, high, and very high criticality assets, assess time to repair. Identify assets with long lead in times for repair/replacement. Schedule appropriate inspection dates for these assets. Prepare interruption management strategy for high and very high criticality assets. This will include identifying: o Where redundancy exists; o Opportunities to hold back sewerage flows upstream, and carry out bypass pumping while repairs are carried out. o Appropriate stocks of spare parts / spare assets. Review spare parts / spare assets held in stock; Review ability to source spare parts / spare assets within 3 hour time frame; Review necessary equipment availability to undertake repairs; Review staffing levels; Carry out gap analysis for preparedness. Prioritise the gap analysis. Enter backlog of reticulation as-builts into GIS and AssetFinda; Review AssetFinda database for obvious mistakes, such as pipe material being listed at a time when that material did not exist or was not in use. Populate the AssetFinda database with improvements to the asset data made whilst preparing the valuation data for the 2014 valuation. June

97 ASSET MANAGEMENT FUNCTION IMPROVEMENT IMPROVEMENT ACTION Improve systems around the capture of new asset data, both constructed by Council and vested. Capture of financial information Improve the systems that support the capture of project costs against assets; Improve the systems that support the capture of the cost of construction for vested assets; Develop a unit rate data base; Improve understanding of asset performance against level of service targets: Prepare calibrated hydraulic models; Carry out network system performance using the models; Report on compliance with level of service targets. Table 17.2: Asset management improvement initiatives for the 6-year period between ASSET MANAGEMENT FUNCTION IMPROVEMENT Capture of level of service performance data IMPROVEMENT ACTION Improve customer service job logging system: o Need to align with new level of service targets; o Need to train customer service staff around new level of service requirements; o Improve interaction between job creation by customer service staff, and electronic delivery of job to field staff; tracking of job progress by field staff back to customer service representatives; and o Improve the flow of information from the customer service request system through to asset performance reporting systems; Improve electronic data exchange between office and field and vice versa Heading towards a system that enables informed decisions to be made (6 year project): o Spatial data on pump stations and pipes with high blockage frequency and/or cleaning frequency. o Develop an understanding of where groundwater and rainwater is entering the network (to the spatial resolution of a mini catchment) o Develop an understanding of areas that are running low on hydraulic capacity within the network. This will assist with decisions on repair/renewal. o Spatial plotting of condition-based appears to pipes and manholes. This may help highlight larger trends in respect of the asset condition. If trends are noticed, they can be used to trigger further investigation. June

98 17.2 PROGRESS WITH IMPROVEMENT PLAN Improvement actions from the 2012 AMP with a target completion date between are listed in Table 17.3 below. Table 17.3: Progress with the 2012 AMP Improvement Plan NO IMPROVEMENT ACTION TAKEN 2 Perform QA check of water utilities data and data cleansing A stocktake of completeness and accuracy of reticulation and plant assets has been carried out. The focus was ensuring that all assets were included within the asset register, and that no decommissioned assets were still listed as active. OUTCOME / DECISION Ongoing 3 Processes developed to update and to maintain data in AM 4 Develop monitoring strategies for the development of the electronic monitoring SCADA system 8 Develop monitoring and reporting processes for resource consents 24 Finalise renewal policy and seek Council approval. 28 Optimise and document service request/work orders and maintenance processes. 29 Develop a strategy and long term programme to improve asset condition and performance data and derive remaining life. 31 Finalise and document As Built process and workflow using cross functional flowchart. 38 Complete and improve hydraulic models of 3 main schemes (Plains, Paeroa, Waihi) 47 Development of standard reports from asset management system to support service managers Minor deficiencies were identified through the stocktake process. Noted errors have been corrected within the asset register. An audit of transfer of data between asset management systems was carried out (the Confirm Database was migrated to the Authority Database, which was subsequently migrated to the AssetFinda database). This audit found only a handful of errors, which have since been corrected within the asset register. There is still additional work to be carried out on the metadata associated with each asset. Processes for vested assets, capital projects and maintenance actions have been implemented, but still require further work to streamline. Upgrade of telemetry processes to a SCADA system A structured monitoring and reporting process has been implemented. Completed. Not started Completed. Completed. Further work is required to make the processes more efficient. Plains hydraulic model underway. Waihi and Paeroa models, not yet started. Completed. Further work is required to make the reporting processes more efficient. In progress Implemented and refining in progress Completed. Completed and implemented within the Lifecycle section of this 2015 AMP. Planned start in planning cycle. Completed. Implemented and refining in progress Underway. Implemented and refining in progress June

99 18 COUNCIL COMMITMENT The Core Plus asset management practice for the wastewater activity has been formally adopted within Council Policy, and approved by Council. Hauraki DC has established an AMP Development Team. The AMP Development Team s job is to formalize the project-management of the asset management planning processes within Hauraki District Council. The wastewater activity and the wastewater asset management planning processes are overseen by the AMP Development Team. The asset management plans for the wastewater activity are updated and republished every three years. The published asset management plans are officially adopted by Council and any subsequent changes are captured in the Change Register. Waihi Treatment Plant valves & fittings June