Integration of strategic and operational asset management

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Integration of strategic and operational asset management

C I R E D 22 nd International Conference on Electricity Distribution Stockholm, 10-13 June 2013Paper 0501INTEGRATION OF STRATEGIC AND OPERATIONAL ASSET MANAGEMENTAndreas STEFFEN Christian WEMHOFF Sven HÜBNER Heiko SPITZERENERVIE AssetNetWork –Germany ENERVIE AssetNetWork – Germany entellgenio – Germany entellgenio – Germanyandreas.steffen@enervie-assetnetwork.de Christian.wemhoff@enervie-assetnetwork.de sven.huebner@entellgenio.com heiko.spitzer@entellgenio.comABSTRACTCoordination of strategic and operational assetmanagement at ENERVIE AssetNetWork was a challengein the past. ENERVIE AssetNetWork developed andimplemented a practical and simple solution supportedby two software tools. These simple tools improve thecoordination between sustainable strategic assetplanning and the tactical operative planning by:1. an automated provision of required data directly fromasset service„s storage systems within a few hours2. “real-time” support of commissioning throughautomated comparison of strategic and operativeprojectsThe chosen approach has been implemented successfullywithin one year and shows first benefits.CHALLENGE AND OBJECTIVEENERVIE provides energy services for electricity, gasand water in Germany. ENERVIE´s subsidiary, EnervieAssetNetWork, operates distribution grids for electricity,gas and water in Hagen, Lüdenscheid and thesurrounding cities. In the past, Asset Management andAsset Service at ENERVIE AssetNetWork faced thechallenge to capture the technical long-term assetdevelopment and the operational short-term projectplanning within one planning process supported by theappropriate IT-tools. However, only this approachguarantees the stringent implementation of strategicobjectives (Asset Management) as well as the operationalproject planning (Asset Service) to have grid budget,quality and risks aligned.The strategic technical Asset Planning is based on thevalidation of asset groups, while the operational AssetPlanning is driven by measures/projects, which leadsbottom-line to different results.Based on these facts, ENERVIE AssetNetWork developedand implemented a practical and simple approachaiming to improve the iterative adjustment processbetween Asset Management and Asset Service (Figure 1).The result is an aligned objective measure/projectplanning and an aligned integrated asset strategy(medium/long-term) for the electricity, gas and watergrid. Both objectives, strategic as well as operativetargets of Enervie AssetNetWork are aligned andfulfilled. This approach – based and supported by twosimple software tools - is already successfully applied inthe daily work processes of Asset Management and AssetService.ASSET MANUAL AND SAME DATA BASEAsset Service at ENERVIE is responsible for theoperational planning of individual projects/measures andsupervises the current asset states for the electricity, gasand water grid.Asset Management at ENERVIE AssetNetWork is responsiblefor the strategic planning of the electricity, gasand water grid and focuses on the overall maintenanceand investment strategies and oversees the allocation offinancial resources. Asset Management further ensuresthe commissioning of overall projects/measures in linewith the two main strategic targets of the company:conservation of grid substance and stable profitability.Figure 1: Interface between Asset Management and Asset ServiceCIRED2013 Session 6 Paper No 0501


C I R E D 22 nd International Conference on Electricity Distribution Stockholm, 10-13 June 2013Paper 0501To support Asset Management, ENERVIEAssetNetWork relies on asset strategy simulation andoptimization (ASP). The Asset Simulation/Optimizationis provided by an industry proofed software tool [1,2,3,4]which is based on the transparent method of cause andeffect dependencies [5,6]The so-called Asset Manual builds the basis of atransparent, contemporary and advanced communicationbetween Asset Management and Asset Service. Themanual contains a description of all relevant data for thedetermination of the states of asset types and theircorrelation. Thus, the asset manual is required and crucialfor the automation of the interface between AssetManagement and Asset Service.The current asset states of individual asset groups arecalculated or directly imported from the different sourcesystems. The results are automatically written back to thesource systems and subsequently they are made availableand provided to the strategic asset planning in anaggregated format. Thereby, an identical database (DB-Views) is being established with regard to the asset statesfor the particular planning in Asset Service on the onehand and for the Asset Management on the other hand.This enables the support of an objective comparison ofprojects/measures between Asset Management and AssetService.the data and indicates if data is missing. Furthermore, it ispossible to change the specification of the asset states onthe front-end of the data processing tool, to recalculatethe asset states and to evaluate the impact of the changesonline.On the other hand, the data processing tool providesautomated data processing back to the connected datasources. The interface translates the results of ASPsimulations into target parameters for the Asset Serviceand other parts of ENERVIE AssetNetWork.Using the data processing tool provides various benefits:First of all, using the interface is faster than processingExcel-sheets manually. For the large amount of datarequired and mathematical steps to be taken, manual dataprocessing via Excel is a very complex task.AUTOMATED PROVISION OF REQUIREDDATA DIRECTLY FROM ASSET SERVICE‘SSTORAGE SYSTEMSThe strategic asset management simulation/optimizationrequires various data from Asset Service and othersources within ENERVIE AssetNetWork. The formerExcel-import and manual data preprocessing is replacedby an automated interface to load and aggregate datafrom various database sources and software tools such asNIS/GIS (Figure 2). This data processing tool helps toreduce the time and effort to prepare the needed data forthe requirements of the strategic asset managementsimulation/optimization significantly.The data processing tool is connected to all importantdatabase sources within ENERVIE AssetNetWork. Datafrom the Asset Service such as stock data, agingparameters and data from other parts of ENERVIE suchas financial and cost parameters as well as information onactual and planned projects/measures are loaded into thedata processing tool.On the one hand, the Data processing tool aggregates andlinks data from all these sources and derives the requiredparameters for the asset strategy simulation andoptimization. The tool provides standardized proceduresthat can be applied whenever the basic data havechanged. The interface allows monitoring the quality ofFigure 2: Data processing toolCIRED2013 Session 6 Paper No 0501


C I R E D 22 nd International Conference on Electricity Distribution Stockholm, 10-13 June 2013Paper 0501Secondly, the interface to increase the quality of assetdata by providing a standard procedure is revised andapproved from all parties. Further the process ensuresthat all data are up to date and match with the currentinformation in different parts of ENERVIE.Thirdly, the interface provides a comprehensible documentationof all steps during data processing. The assetdata mapping, aggregation and processing can easily bereproduced every year (or month) with little effort.Changes to the process can be easily implemented andmonitored.All in all the automated asset data processing interfacefacilitates the processing of the asset data significantly.At ENERVIE AssetNetWork the annual setup for theasset strategy simulation and optimization will be done inan automated and comprehensible way within a veryshort timeframe and with a very high quality.USING THE PROJECT ALIGNMENT TOOLFOR COMPARISON OF PROJECTSThe project alignment tool builds the bridge betweenstrategic Asset management and Asset service: it isassured that the asset strategy will be implemented.Within the tool individual tasks can be prioritized andapproved (Figure 3). The project alignment tool showsdifferences between Asset Management and AssetService through a simple “traffic light” display. TheAsset Management can then approve each project/measure from the list of all currently planned operativeprojects/measures. The tool shows, how the approvedmeasures would affect the overall CAPEX/OPEXexpenditures. If the list of projects/measures does notmeet all budget constraints, Asset Management and AssetService reiterate to find a common and agreed solution.COMPARISON OF PROJECTS FROM ASSETMANAGEMENT AND ASSET SERVICEThrough a structured interface, the results of the bottomupplanning in Asset Service and the top-down planningin Asset Management are imported into a “projectalignment tool” for comparison and evaluation of theplanned projects. By using this additional and separatesoftware tool for comparison of planned projects theadaption of the existing planning tools of AssetManagement and Asset Service is avoided.Asset Service provides information on the operativeprojects currently conducted and planned. This fairlydetailed bottom-up information lists projects e.g. forindividual streets and provides relevant asset data foreach project, such as quantity and state of assets affected,current status of the project, costs, importance etc.The project alignment tool then maps this informationwith top-down objectives defined by the AssetManagement. The key figures required for the mappingare imported directly from the asset simulation andoptimization tool (Figure 3). This approach allows acomparison of key figures (e.g. investments, asset levelby effort, and quantities replaced by each measure) fortop-down and bottom-up planned projects.As a result, the project alignment tool enables an efficientand effective alignment between strategic and operationalplanning. Also a transparency for both, the Asset Serviceand the Asset Management, is achieved. The projectalignment tool provides a kind of “market place”, thus aplatform where operative and strategic planningapproaches can be fine-tuned and brought into agreement.Figure 3: Project alignment toolCIRED2013 Session 6 Paper No 0501


C I R E D 22 nd International Conference on Electricity Distribution Stockholm, 10-13 June 2013Paper 0501Only a structured and constructive discussion betweenthe partners in Asset Management and Asset Service cansolve differences in planning. Differences in planningwill lead to an adaption of the asset strategy and/or of theoperational planning.Reasons for differences in planning may be positioned inAsset Management and/or Asset Service. Perhaps thereare local needs (e.g. investments programs of cities) toinvest more in certain areas which was not taken intoaccount or known when the asset strategy was developed.Then, the asset manager has to adapt the current assetstrategy. But it might also be that in Asset Service thechosen asset strategy is simply not reflected in theplanned projects. Then Asset Service has to change itsplanning to get the projects aligned with the chosen assetstrategy (see Figure 4).BENEFITS/OUTLOOK OF THE APPROACHThe implementation of the described approach (whichtook around a year) to coordinate sustainable strategicasset planning and the tactical operative planning hasproved to be successful in daily work of ENERVIEAssetNetWork since 2012. Besides some processchanges, two software tools were developed which alsofostered the discussions between Asset Management andAsset Service. To define a standardized process tocoordinate operative and strategic asset planning, a lot ofconstructive discussions were necessary. In addition thedata processing tool and project alignment tool createbenefits by reducing time and effort and at the same timeincreasing quality of work. For example: the time to fillthe ASP-tool with the required data has been reducedfrom around 6 weeks to a few hours.It was important that the data processing tool and projectalignment tool did not require fundamental adjustmentsof the existing software tools for asset planning. The twonew software tools were fully integrated to them.The constructive discussions between Asset Managementand Asset Service (which are now possible on projectlevel with a “real-time” information support) lead to anobjective asset planning and implementation of necessaryprojects in the grid for the welfare and benefit ofENERVIE AssetNetWork (see Figure 4). Additionally,the mutual understanding and acceptance between theindividual partners in Asset Service and AssetManagement has improved considerably. Based on thecurrent success of the approach further extensions andincrements are planned.Figure 4: Aligned budget allocationIn both cases the staff from Asset Service and AssetManagement have to discuss in detail what the reason isand what has to be done to fix the difference. After one ormore iterations, there will be a mutual approval of theplanned projects.All in all, the “project alignment tool for comparison ofplanned projects” outlines the implications of theindividual projects on the overall asset strategy. Theproject alignment tool provides the platform forconstructive discussions between asset management andAsset service and thus leads to a more realistic planningin line with constraints from finance or regulation.The tool further provides a standardized managementprocess leading to an integrated implementation of theprojects in line with the technical and strategicrequirements. In addition, the project alignment toolhelps to increase the mutual understanding betweenpeople from Asset Service and Asset Management.REFERENCES[1] Kallweit, T.; Schwarz, U.; Spitzer, H.: „AssetStrategy Planning – Simulation als Basis fundierterund nachhaltiger Asset Strategien“, in: etEnergiewirtschaftliche Tagesfragen, 55. Jg. (2005),Heft 7, S. 488-489;[2] Gaul, A. J.; Spitzer, H.: „Asset Simulation – anapproach to predict the long term monetaryconsequences of maintenance and renewal strategiesfor electrical grids“, CIRED, 19th InternationalConference on Electricity Distribution, Wien, 21.-24.5.2007, Paper 0668.[3] Dutz, A., Spitzer, H., Schulterschluss zwischenTechniker und Kaufmann, et EnergiewirtschaftlicheTagesfragen 59. Jg. (2009) Heft 4[4] Spitzer, H., Engels, C.: „Dynamic Asset Simulation- Risk Management am Beispiel der Energieversorgung“,Riskconf, München, 2009.[5] Forrester, J.W. 1961, Industrial Dynamics, OR,Productivity Press.[6] Sterman, J.D., 2000, Business Dynamics, SystemsThinking and Modeling for a Complex World,Boston, MAet al.; Irwin/McGraw-Hill.CIRED2013 Session 6 Paper No 0501

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