FUNDAMENTAL ASPECTS OF INFORMATION PROCESSING TO SUPPORT ASSET MANAGEMENT

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1 FUNDAMENTAL ASPECTS OF INFORMATION PROCESSING TO SUPPORT ASSET MANAGEMENT Ben QUAK (1), Edward GULSKI (2), Johan J. SMIT (2) & Philip WESTER (3) (1) Transportnet Zuid-Holland Netherlands (2) Delft University Technology Netherlands (3) Nuon InfraCore Netherlands INTRODUCTION The international (Europe, Australia, South-America, US) liberalisation the energy market changes the way electric utilities operate. In the old days, the attention was focused on the reliability supply. Nowadays the attention has been drawn to a more efficient and economic supply electric energy. Due to the liberalisation process, both utilities as well as their clients will be exposed to market mechanisms, such as price and responsibility risks. As a result this liberalisation process, a wide interest in Asset Management has grown amongst electric utilities as a mean to maximize pritability. ASSET MANAGEMENT Asset management (AM) is the balancing act in which asset performance is balanced against stakeholders expectations. These important changes in the working environment power utilities force the asset manager to concentrate more on methodologies for cost reduction, keeping at the same time the reliability and power quality at high or agreed level. [1-4] On the other hand, a regulated and negotiated reliability the power supply is required, and the claims for non-delivered energy in case network component failures are increasing, see figure 1. REVENUE: reduction maintenance & investment costs PRESSURES: constrains costs, penalty claims, safety Agreed quality and reliability power supply LIFE-TIME: maximum service life the network components FLEXIBILITY: different operation loads Figure 1: Effects liberalization on electricity markets. To facilitate AM, the AM decision processes should be designed correctly to facilitate the balancing act using the right information at the right time [1]. In other words: before decisions can be made it has to be clear what the effects a decision are with regard to the expectations the stakeholders. Examples the expectations stakeholders can be an expectation about a certain: amount pritability amount risk involved level (personal) safety etc., etc. INFORMATION ASPECTS The aspects information needed to support AM decisions can be divided in three main categories: Technical aspects Economical aspects Societal aspects In figure 2, an example is given these categories, regarding aspects risk assessment consequences (within the AM decision process). Penalty Loss Power Outage Provisional Solution Ageing Maintenance & Repair Type Of Defect Probability Condition Assessment Safety Social Impact Acceptability Imago Frequency Overvoltage Probability Location Defect Impact Number Connections Criticality Connection Operation Restore Time Figure 2: The three categories information aspects to support AM decisions regarding outage risks cable. Technical Aspects Relevant information needed for AM decision support is dependent on several asset-related parameters, such as the insulation ageing a component and the probability an over-voltage across a component, e.g. as a result switching activities. The component ageing is related to the absolute age, the type, the history and the operating conditions a network (sub) component. In order to decrease the probability TZH_Quak_A1 Session 5 Paper No 7-1 -

2 to a failure, condition assessment can be used. A combination diagnostic tools for condition assessment is chosen and applied, depending on the different types and locations insulation defects induced degradation sites. The technical aspects cover amongst others condition assessment, aging models, and failure probability, but also information on the equipment inventory, the network topology, the available spare parts, the current maintenance procedures, the history maintenance actions and the history failures. Economical Aspects As every technical aspect will have its financial counterpart, economical aspects are for example the costs maintenance, repairs and failures, but also the costs condition assessment and the investment costs for equipment and spare parts. In this paper these costs will be called the economical information on assets. The costs related to a failure are dependent on the outagerelated expenditure. s mostly result in major damages to network components and their environment, which will lead to high maintenance and repair costs. In case major critical damages, pressional solutions are needed to restore the energy supply as quickly as possible, eventuating in higher expenditures. Outages can result in customers compensation and responsibility claims in the form penalties. The need for economical information finds its origin in the fact driving a business, e.g. penalty costs from customer contracts, possible claims from customers and the costs undelivered energy. In this paper these aspects will be called the economical information on business. Societal Aspects However, within the asset management decision process, technical and economical aspects are not the only aspects to keep in mind. As an example, risks are not only determined by the economics. There are also some societal aspects that have to be considered, such as the impact on society outage and failures. acceptability can be reflected as the degree in which a failure is acceptable from the social point view. The failure impact is depending on the criticality and number connections, which are affected with a failure and the time to restore the particular failure. Even so, frequent energy interruptions in a short period time will not be acceptable from a social point view. Furthermore, the social impact utility s policy is determined among others by two factors: the imago to the public and the feeling safety. For example, power losses related to buildings with a high social standard, e.g. hospitals, have a low acceptability level. Some the societal aspects will be guarded by the regulator, which will translate these aspects in proper regulation. This regulation will result in economic aspects such as penalty costs. Other societal aspects as the imago the power utility or the personal safety its employees cannot be easy translated into economic aspects, but should also be covered when investigating risk. Also power supply disturbances in buildings with public character e.g. shopping malls, congress centres, hotel fice towers, airports etc. are having impact on public opinion about safety. This societal impact can have very strategic consequences. Customers can show the urge to change energy supplier so a successfully operating asset manager (low maintenance cost) can bring a utility large damage (high failure rate). DECISION PROCESS When pursuing optimal economical performance decisions have to be made about which all the possible maintenance or investment actions are the correct ones. Simply put, this can be seen as decision process, where decisions are made on technical, economical and societal information. However, this is a continuous process [1], as decisions influence the system, and therefore influence at least the technical and economical information on which the decision is based. Information Process Figure 3: process is continuous To avoid complexity this continuous aspect the decision process is not reflected in the figures 4-8. Looking in more detail, this decision process can be seen as build three separate levels, as illustrated in figure 4. The first level deals with the technical information; the second level uses the results the first level and the economical information on assets, while the third level combines this with the economical information on business and societal information. Technical Information Economical Information 1 (on assets) Economical Information 2 (on business) Societal Information 1: Maintenance and diagnostic evaluation, scenario search and evaluation effectiveness & usability 2: Economical evaluation scenarios Creation maintenance strategies, life curves and life cost computation 3: Risk Management Selection optimal scenario, and optimal strategy Figure 4: Asset maintenance management decision process on three levels Another way to look at this is illustrated in figure 5. The first level mainly consists technical asset information and condition assessment, and is mainly focussed at components, the second level which combines the economic information on assets with the results the first level has more focus on the level the network (the reliability it), while the third TZH_Quak_A1 Session 5 Paper No 7-2 -

3 level uses the economic information on business combined with the societal information, to make decisions about risk which have mainly a corporate focus. Impact assessment Social information Safety Social System S 3 Risk assessment Risk management System ( Dollar) Financial information Reliability management Condition assessment Asset information Corporate level Network level Component level Figure 5: The decision process [CIGRE WG 23/39-14, 2002] Level 1: Component level From a technical point view, multiple scenarios can be found to influence the performance assets. For example, scenarios could be in- or decreasing maintenance and inspection intervals, replacement or refurbishment, but also about changing the maintenance strategy from corrective maintenance to time based or condition based maintenance. The scenarios are found by analysis and combination the equipment inventory, the maintenance actions already performed on the equipment, the current rules that exist for maintenance, and condition assessment, that results from diagnostics, in combination with statistical evaluation practical failure cases, reliability evaluation and ageing models result. expectations for example will be taken into account at the third level. Level 2: Network level Combination the technical information the scenarios with relevant economic data from underlying economic systems will result in a quantification benefits and costs each scenario. These benefits and costs are not exclusively expressed in economic terms, but could also be expressed in other terms such as reliability or expected lifetime. For example, enlarging an inspection interval may cause a benefit in decreased expenditures, but could have costs in terms decreased reliability. On the other hand, shortening the interval might have costs in increased expenditures, but could lead to benefits in increased reliability. Equipment Investment costs Maintenance costs Diagnostics costs costs for outage and repair Spare parts and equipment costs Cost fers from suppliers Replace Run to failure Refurbish CBM/TBM/CM M/D modification As Before Monitoring Selection relevant economic data 2: Economical evaluation different alternatives, Creation maintenance strategies, life curves and life cost compu tation with quantified benefits or costs Figure 7: Processing AM information on network level. This level AM decision process, is combining the relevant economic data with the scenarios from the first level. Level 3: Corporate level Equipment Inventory Maintenance On the last level, balancing the cost and benefits the scenarios with the risk involved with each scenario will result in the strategic decision with the best-managed risk. Maintenance rules Replace Diagnostics cases 1: Maintenance and diagnostic evaluation, scenario search and evaluation their usability Run to Refurbish CBM/TBM/CM M/D modification with quantified benefits or costs As Before Reliability evaluation Aging Models Spare parts and equipment Monitoring Figure 6: Processing AM information on component level. All these scenarios will have a different effect on the technical performance (in terms reliability and availability) the asset. At this stage, scenarios should not be excluded based on their effect on technical performance, because in the next levels, the scenarios will be combined with other relevant data, which even may cause a scenario with a negative effect on technical performance to be the most economic while having the smallest risk. The stakeholders Business Values Customer contracts Regulator Safety regulations Network topology Demanded reliability, availability and quality; Undelivered energy price, Claims, Fines Risk Assessment 3: Risk Management Figure 8: Processing AM information on corporate level. This level is managing the risk the different scenarios. At this level, all stakeholders expectations can be taken into account when they are formulated as business values, resulting in a set performance indicators to give expression to those expectations. The societal and economic information, together with the reliability the equipment inventory and TZH_Quak_A1 Session 5 Paper No 7-3 -

4 network topology form the ingredients the risks involved. A balancing the risks will lead to the final decision. As a first step in this process one has to be aware a difference between network/management-oriented decisions and asset/equipment-oriented decisions, as illustrated in figure 9. The first group (asset related) is related to the accepted level risk or (or included) the necessary reliability. The second group (management related) is related to the acceptable condition level equipment as based on a failure mode and criticality analysis per component (type). Balancing these two groups will lead to an optimal balanced decision regarding the maintenance equipment. applied norms and criteria for analysing asset performance are the dynamic type but results condition assessments and/or asset identification data are the static type. AM ORGANISATION AND INFORMATION ASPECTS In addition to information aspects to support the asset management decision process, utility organisation aspects also play an important role, as illustrated in figure 11. Strategy Condition assessment Aging Organisation Process Information Maintenance techniques Asset Reliability analysis Structure Responsibilities Skills & competencies Stakeholders values Architecture Management Information Support Control via KPI s and BSC LCC calculation Risk analysis Asset Related Management Related Figure 9: Selected processes, techniques related to Asset Management. Templates to facilitate this balancing should concentrate on information regarding consequences (on the three levels: social, technical and economical) energy interruptions or failing circuits. Besides, at component level, the relations between component failure and the network consequences are investigated. Definition data and information sources For a successful AM decision process it is necessary to translate the necessary information aspects (as mentioned above) into usable data sources. An important approach for organising information flows and data sources is to differentiate between static and dynamic data. These data types influence the identification/separation, type and complexity data sources and the decision systems they support. As a result, with dynamic data types the asset manager can make sensitivity analysis, with static data types this is not possible. Figure 11: Basic AM framework pyramid. The two aspects information and organisation cannot be fully developed separately. However, in order to choose a solution regarding the information strategy that fits the existing organisation, it is necessary for a utility to accept the possibility re-organisation if such seems to be necessary to meet the information strategy to be implemented. The subdivision the decision process emphasizes that to facilitate AM different disciplines are involved in gathering and processing all necessary information. For example, when supporting the AM decision process from the point view an organisation, most information about technical aspects might be easily available and gathered amongst (service) engineers, while the economic data will be more easily available and processed amongst financial staffmembers. The third level benefits from a team with experience in legal issues, risk assessment, risk management and network planning. When the AM decision process is supported with automated tools, all these roles will still be necessary. While the stakeholders expectations are taken into account at the corporate level (formulated as business values), from the above can be learned that to facilitate the AM decision process correctly, one has to include all the different disciplines and cover all aspects all the three levels. PRACTICAL APPROACH Dynamic management oriented data sources Static Asset oriented data sources Consequences Criticality System Reliability Asset Condition Balanced decision Figure 10: Data sources: Static vs. Dynamic. This means for instance that acceptability level risk or In the following practical approach the information aspects and the decision process can be recognized. To support an asset manager in his decision making, all relevant information should be directed in a proper way to the asset manager in order to prepare the correct decision, see figure 12. This decision should be based on an impact assessment and concerns if, when, what, how and by whom a maintenance, re-investment or refurbishment activity should be executed. For this decision, both present and expected, information TZH_Quak_A1 Session 5 Paper No 7-4 -

5 about is indispensable. Moreover, network risk analysis should be executed and different type sociological, technical and economical data should be available. A thorough decision also necessitates information about the internal organisation and the possible suppliers the service decided upon. It is obvious that an asset database, which contains the relevant object data, should be provided. All the relevant costs like investment, depreciation, maintenance and operational activities should be linked to the objects in order to be informed about the life cycle costs up till the moment decision making. Besides information about redundancy in the network and the basic principles network design there are basically five types information sources necessary for a thorough decision making process: 1. Information about the (expected) asset behaviour preferably benchmarked against a larger population. The asset behaviour assessment should be based on a failure mode effect and criticality analysis per type. A sub-information data source informs about the necessary action needed to correct (or corrected) functionality the asset involved. 2. Information about customers connected to the (regulated) grid, mainly information about agreed availability, liabilities and penalties. Depending on the situation this data source also contains information about the agreements related to the sub (distribution) networks. This data source is, to a large extent, dedicated to a risk analysis approach. 3. Economical data related to network planning, long term estimated expansion the grid. Economical data related to constraint costs (to be paid to the network manager if a circuit is out service) and results from regulator negotiations (in which way availability/cost ratio information has to be provided). 4. Data regarding social, strategic and environmental aspects. Acceptability or (economic) consequences interruptions in power supply related to environmental or personal safety, possibility customer loss or even consequences at government level (large industry losses, unacceptable number outage minutes, safety items and so). Figure 12: AM information/decision process. 5. An asset database including all the standard and static information about the assets. It is great importance that all the information related to the asset involved is following the asset if replaced in the network including the links to the information source as mentioned under 1. Moreover dynamical information mainly related to protection systems and connection circuits should be stored in this data source. All this data should, if they exceed a certain limit, come together in a decision support impact assessment system for the asset manager. In this system the correct relations between the different data will advice the asset manager about an action. The asset manager then has to be supported by a cockpit function, figure 12. Based on the cockpit he controls the information coming in, judges the advice given by the expert system and decides upon and manages the action to be taken based on the risk he is advised to take. Depending on the make-or buy strategy the organisation has adopted, the action will be either outsourced or executed by own personnel [3]. However, the control the quality the executed action should be identical in both outsourced and internal execution. CONCLUDING REMARKS Based on the discussion as given in this paper the following conclusions can be made: The information aspects AM decision process can be divided into the three categories: technical, economical and societal. The decision process itself can be regarded as consisting three separate levels: component, network and corporate. When an implementation an AM decision process does not cover aspects all three these levels, the main goal AM, finding the best balance between component performance and stakeholders expectations, will not be reached, which probably will not lead to the highest efficiency possible. In addition to information aspects to support the asset management decision process, organisation aspects also play an important role. The Asset Manager decision should be based on an impact assessment and concerns if, when, what, how and by whom a maintenance, re-investment or refurbishment activity should be executed. REFERENCES [1] Ph.Wester, J.J. Smit, J. Oestergaard & J. Corbett, 2002, Development asset management services, 2002, Cigre session Paris 2002, paper ) [2]Ph. Wester, B. Quak, E.R.S. Groot, E. Gulski & J. J. Smit, 2001, Impact Condition Based Maintenance on Asset Management, Cigre SC23 Colloquium 2001, Venezuela, paper 1.6 [3] Ph.Wester, J.J. Smit & E.R.S. Groot, 2001, Outsourcing TZH_Quak_A1 Session 5 Paper No 7-5 -

6 maintenance processes in electricity utilities, 16th International Conference and Exhibition on Electricity Distribution, CIRED 2001, Amsterdam. [4] B. Quak, E. Gulski, J.J. Smit, Datamining and information processing to support the AM decision making process, ERA Conference on Engineering Asset Management, 5-6 Nov London, UK TZH_Quak_A1 Session 5 Paper No 7-6 -