Asset Management - A Cradle to Grave Concept

Effective asset management can help utilities overcome the challenges of harnessing the full potential of their assets.
Published: Mon 10 Feb 2014

Restrictive budgets, increasing priorities and strict regulatory regimes are forcing utilities to make do with what they have. Utilities have to decide where to invest their money in order to attain the best return on investment. According to Dr Siri Varadun, VP, Asset Management, UISOL (An Alstom Company), utilities are adjusting their strategies:

  • Risk is not avoided but now managed more effectively

  • Costs are not lowered, but optimized

  • Performance is not maximized but adjusted to achieve thresholds

During the asset management process, the utility needs to think how it should invest its money in order to attain the best return of investment. By using quality asset data, the utility can work out the following through the use of a geographic system or an asset registry:

  • What assets they own and their location

  • Importance of assets, their condition and performance levels

Armed with this information, utilities can work out what actions must be implemented with regards to maintenance, restoration or replacement.

Asset Criticality

To label an asset as critical, utilities must consider the risk factors-operational, environmental and public safety. Asset criticality is typically calculated per asset or by asset type and prioritized based on an asset’s geographical and topological location.

Asset Health

Asset health is often considered subjective. The factors that determine asset health are not always quantifiable and, therefore asset health is different from asset performance. However, the industry can use various tactics to assess asset health. A score from 0 to 100 is sometimes used with the understanding that 0 means the asset is at end of life and requires immediate attention, repair or replacement. A score of 100 means the asset does not need attention for a while.

The asset health indicator should allow peer comparison, provide an idea of remaining operating life and reveal when intervention is needed in order to avoid potential failure.

Utilities should rely on statistical data and reliability-centered maintenance reports that reveal failure rates for each failure mode.

Editor's Note: Hungry for more Intelligent Grid & Automation insights? Check out our Intelligent Grid In-Focus Track for the inside scoop on Self Healing Networks and Intelligent approaches to Asset and Outage Management;

Asset Performance

The measurement of asset performance is based on failure frequency and duration. Other metrics include restoration time, maintenance costs and time between failures. Financial metrics such as replacement costs, observation and measurement costs and return on investment can also be included.

Selecting and defining the metrics to use, and the logistics of data collection for calculating metrics are critical when implementing an asset management project. It is difficult to calculate an individual asset's performance due to the lack of monitoring. However, it is possible to make valid inferences about asset performance by analysing data from a variety of sources.

This is typically an area where data integration helps the most. Data collected through online monitoring of electrical and non-electrical devices is common with smart grid. The new data can be used to assess asset health and performance when the systems are integrated properly.

Asset Investment

Actions should be aimed at restoring assets to their original performance and health. These actions include asset maintenance, repairs, refurbishments or replacements. Each action has its advantages and disadvantages. Implementation costs and the resulting long-term benefits should be considered when making a decision with regards to asset investments. This science of decision making is at the core of asset investment planning.

Asset investment planning will help utilities to prioritise projects according to an established set of objectives. The rankings indicate projects' importance, their expected return and the time frame in which each project must be carried out. Asset investment planning also provides information about possible risks associated with each project.

Asset management requires careful asset planning from beginning to end. Utilities need to ask the right questions during the process in order to ensure that goals are achieved. In our recent article Strategic Asset Management is an Investment in Itself, we explore how effective asset management programs maximise the return on investment for utilities, ratepayers and shareholders alike.

Says Dr Varadun: “Correctly performing the work requires incorporation of best utility practices, tight integration of online monitoring, implementation of an asset management culture and personnel training. Leveraging smart grid efforts will be a key factor in the future of asset management.”

Further Reading:

Modern Grid Solutions-Online Condition Management and the Move Towards the Predictive Grid