**8.2. Tactical planning in a midsize utility**

Let us put ourselves now in the position of a middle manager of the same utility, in charge of infrastructure planning and rehabilitation for the water supply system. Let us take as an example the strategic objective *Improve the efficiency of use of environmental resources (water and* energy), as listed in (see criterion 3.1). The utility's networks display undesirable failure rates (pipe breaks) and the energy bill for pumping is higher than would appear reasonable; the network has unflattering water losses and localized pressure problems during peak con‐ sumption hours remain.


In traditional AM practice, we would probably start by gathering an updated and reliable inventory of the existing assets and by compiling as many reliable records as possible of their condition and failure history. We would try to identify the locations where there are pressure problems, and we would also look at pump efficiency and energy consumption. We would probably try to assess the relative importance of each asset. Combining these types of information, we would prioritize interventions within our budget constraints.

This would contribute to answering the first question. What could be done about the other two? Fixing pumps and replacing some pipes will undoubtedly contribute to saving water and energy. But would that maximize the utility of the investment made? A discerning board might be less than satisfied; and the third question would still remain unanswered. They might ask some additional questions:


STRENGTHS WEAKNESSES

OPPORTUNITIES THREATS

The SWOT analysis results led to the establishment of strategies. For drinking water, the key selected strategies were *Controlwater losses* and *Promote proactive rehabilitation practices*, whereas for wastewater the strategies established were *Reduce untreated wastewater discharges* and *Reduce cross connections and infiltration/inflow in wastewater systems*. The common strat‐ egies of both types of services were *Improve infrastructure information systems* and *Increase sys‐*

Let us put ourselves now in the position of a middle manager of the same utility, in charge of infrastructure planning and rehabilitation for the water supply system. Let us take as an example the strategic objective *Improve the efficiency of use of environmental resources (water and* energy), as listed in (see criterion 3.1). The utility's networks display undesirable failure rates (pipe breaks) and the energy bill for pumping is higher than would appear reasonable; the network has unflattering water losses and localized pressure problems during peak con‐

**•** How would we prove that our decisions are effectively addressing the strategic objective?

**•** How would we quantify the impact of our decisions and of subsequent actions?

infrastructures - Financial restrictions - Inadequate tariffs

(increase in costs) - Political uncertainties








64 Water Supply System Analysis - Selected Topics


**Table 3.** SWOT analysis summary

sumption hours remain.

**•** How would we act?

*tem reliability*.




\* ERSAR: the water and waste services regulator in Portugal

**8.2. Tactical planning in a midsize utility**

infrastructures

condition and performance

**•** Did we assume that the existing network's configurations (e.g., layout and diameters of networks, location and characteristics of storage tanks and pumping stations) are ade‐ quate from the energy point of view?

These are the types of issues that a good IAM approach should aim to tackle in a structured, aligned and transparent way. As a basis for tactical planning, this utility took the strategic directions previously defined: objectives, targets and strategies. The following tactical IAM objectives were set:


At a first stage of tactical planning, the network was evaluated coarsely in its main subdivi‐ sions: trunk main system and supply subsystems (DMAs, or District Metering Areas). The prioritisation of DMAs with higher intervention needs was based on the assessment of the selected metrics for all DMAs, not only for the current situation, but also by assessing the response of the existing systems to the predicted evolution of external factors (e.g., de‐ mands, regulation, funding opportunities, economics).

DMA 542 was in this high priority group, since it failed to comply with most tactical targets. It supplies a stable and heterogeneous urban area, comprising new and old residential build‐ ings, schools, shops and some commercial areas. It supplies approximately 10,000 people (4,388 contracts) with a network of approximately 12.5 km of total pipe length, 40% of which in asbestos cement and the remainder in more recent plastic materials. Water is supplied by grav‐ ity from a service tank at elevation 185 m, and the lowest ground elevation is 107 m.

The tactical plan was designed for a 5-year planning horizon (2011-2016). Any envisaged in‐ terventions will have to be scheduled over this period. However, the evaluation was carried out over a 20-year analysis horizon in order to ensure that the interventions planned are the best compromise both in the medium-and in the long-term (Alegre *et al.*, 2011). The availa‐ ble investment budget for this DMA allows for the replacement of approximately 1 km of pipeline per year, for 5 years. Reference assessment timesteps were considered at years 0, 1, 2, 3, 4, 5, 10, 15 and 20 (i.e., 2011 to 2031).

Good (green) Fair (yellow) Poor (red)

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Inv (cost units) [0, 350[ [350, 450[ [450, ∞[ IVI (-) ]0.45, 0.55[ [0.30, 0.45[; [0.55, 0.70[ [0, 0.30]; [0.70, 1] Pmin (-) [3, 2[ [2, 1[ [1, 0] Pmin\* (-) [3, 2[ [2, 1[ [1, 0] AC (%) [0, 9[ [9, 15[ [15, 100] RL (l connection-1 day-1) [0, 100[ [100, 150[ [150, ∞[ UnmetQ (m3/year) [0, 20[ [20, 30[ [30, 100]

Several system-driven solutions and like-for-like replacement solutions, within the available budget, were analysed (Marques *et al*., 2011) and designed to solve or mitigate the problems identified in the diagnosis, both in-house and through external consultants. The final set of

**• Alternative A0** (*status quo*, or base case): corresponds to keeping the existing network as it is, and retaining the current reactive capital maintenance policy (which in the present case

**• Alternative A1** (*like-for-like replacement*): an IAM project consisting of a prioritized list of pipes to be replaced by the same-diameter HDPE pipes. The prioritized list was devel‐ oped externally to the AWARE-P software, following a like-for-like replacement strategy, using pipe failure and consequence analysis (as in FAIL/CIMP) and an ELECTRE TRI de‐

**• Alternative A2** (*system-driven solution*): an IAM project based on an *ideal* redesign for the net‐ work, as if it were built from scratch for the present-day context – significantly different from the actual current network, which was designed and constructed from the 1940s onwards. This ideal redesign, heavily backed by network modelling, driven by performance and risk assessments, is viewed by the utility as a future target reference, to be gradually reached by incrementally changing individual pipes as they are replaced, and by making some key lay‐ out modifications. It addresses the same pipes targeted in A1, but replaces them with new pipes of optimal diameter (often smaller, as the original network has overcapacity in places); in Year 5, a new 625 m-long pipeline connecting to a neighbouring DMA is introduced in or‐

The assessment of the three alternatives was carried out for the 5-year planning horizon and for a 20-year analysis horizon.Table 5 illustrates the results of the selected metrics for the three alternatives at Year 5. Fig. 5shows snapshots of the 3D view of results, with time, as‐ sessment metrics, and alternatives depicted respectively along the left, right and vertical ax‐ es. The majority of the assessment metrics are constant after year 5 (with the exception of IVI and UnmetQ), due to the adoption of a constant demand scenario (this is a very stable resi‐

alternative solutions were summarized as follows (including retaining the *status quo*):

cisional method, and taking into consideration 3rd-party coordination.

der to improve reliability of supply in emergency situations.

**Table 4.** Multi-criteria reference values

was based on repairs after break only).

Since this example involves only alternatives related to physical intervention in the infra‐ structure, compliance with the above-mentioned tactical IAM objectives was assessed through the following performance, risk and cost metrics:


The values of the metrics were further divided into 3 ranges (good, fair and poor) according to the thresholds set by the utility, based on the experience of their key staff (Table 4).

The diagnosis of the situation at year 0 using the assessment metrics and associated refer‐ ence values pointed to the following problems:



**Table 4.** Multi-criteria reference values

The tactical plan was designed for a 5-year planning horizon (2011-2016). Any envisaged in‐ terventions will have to be scheduled over this period. However, the evaluation was carried out over a 20-year analysis horizon in order to ensure that the interventions planned are the best compromise both in the medium-and in the long-term (Alegre *et al.*, 2011). The availa‐ ble investment budget for this DMA allows for the replacement of approximately 1 km of pipeline per year, for 5 years. Reference assessment timesteps were considered at years 0, 1,

Since this example involves only alternatives related to physical intervention in the infra‐ structure, compliance with the above-mentioned tactical IAM objectives was assessed

**• Inv**: *investment cost,* measured through the net present value at year 0 of the investments

**• IVI**: *infrastructure value index (IVI,* the ratio between the current value and the replacement value of the infrastructure (Alegre and Covas, 2010); it should ideally be close to 0.5.

**• Pmin**: *minimum pressure under normal operation index*, measuring compliance with the mini‐

**• Pmin\***: *minimum pressure under contingency conditions index,* measuring compliance with the minimum pressure requirements at the demand locations when the normal supply source

**• AC**: *percentage of total pipe length in asbestos cement*; although this metric may seem uncon‐ ventional as a performance indicator, it was selected as a proxy for system resilience, reli‐ ability and ease of maintenance (or the lack thereof), given the poor track record of the

**• RL**: *real losses per connection*, as defined in the IWA performance indicator system (Alegre

**• UnmetQ**: *risk of service interruption.* This reduced service metric is given by the expected value of unmet demand over 1-year period. The risk of service interruption associated to a specific pipe depends on the likelihood of its failure and on its consequence on the ac‐ tual service. This risk is calculated for each pipe as a combination of failure probability

The values of the metrics were further divided into 3 ranges (good, fair and poor) according

The diagnosis of the situation at year 0 using the assessment metrics and associated refer‐

**•** *Reliability of the system:* insufficient pressure in normal conditions at some locations; high

**•** *Infrastructural sustainability:* poor condition (high failure rates) of asbestos cement pipes.

to the thresholds set by the utility, based on the experience of their key staff (Table 4).

pipe failure rates; low system resilience in contingency operation conditions.

2, 3, 4, 5, 10, 15 and 20 (i.e., 2011 to 2031).

66 Water Supply System Analysis - Selected Topics

made during the 5-year plan.

through the following performance, risk and cost metrics:

mum pressure requirements at the demand locations.

aging asbestos cement pipes in this utility.

ence values pointed to the following problems:

*et al.,* 2006).

and component importance.

**•** *Water losses:* high leakage levels.

point to this DMA fails and an alternative entry point is activated.

Several system-driven solutions and like-for-like replacement solutions, within the available budget, were analysed (Marques *et al*., 2011) and designed to solve or mitigate the problems identified in the diagnosis, both in-house and through external consultants. The final set of alternative solutions were summarized as follows (including retaining the *status quo*):


The assessment of the three alternatives was carried out for the 5-year planning horizon and for a 20-year analysis horizon.Table 5 illustrates the results of the selected metrics for the three alternatives at Year 5. Fig. 5shows snapshots of the 3D view of results, with time, as‐ sessment metrics, and alternatives depicted respectively along the left, right and vertical ax‐ es. The majority of the assessment metrics are constant after year 5 (with the exception of IVI and UnmetQ), due to the adoption of a constant demand scenario (this is a very stable resi‐ dential area),and to having assumed negligible growth of O&M costs. In this case, the com‐ parison and selection of alternatives can be based on the assessment for Year 5.

The results for A1 show that it is generally better than A0 is terms of infrastructural sustain‐ ability, water losses and risk (IVI, AC and UnmetQ). Investment is of course higher than in A0, but within the available budget. However, A1 perpetuates the design deficiencies inher‐

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Alternative A2 aims at realistically and progressively bring the existing network to a config‐ uration closer to the ideal. Its resilience is improved when compared to A0 and A1, as it re‐ inforces the options for supplying the network from an alternative supply point. Investment costs are higher than for A1 (350 vs. 274cost units). The percentage of asbestos cement pipes is also significantly reduced (to 8.5%, from 37% for A0). This alternative displays the best allround long-term balance of performance, risk and cost, as expressed by metrics that reflect

The adoption of a structured IAM approach in the utility illustrated by this example provid‐

**•** Using a coherent and aligned system of objectives, metrics and metrics enables the IAM manager to show that the decisions are effectively addressing the strategic objectives, and

**•** The hydraulic problems were duly taken into account by splitting the whole system into subsystems and analysing in more detail, including in hydraulic terms, the most problem‐

**•** The selection of sizes and materials for the new pipes was driven by the ability of the existing network in meeting current and future needs and in minimizing energy consumption.

Infrastructure asset management of urban water infrastructures will be increasingly critical in the coming decades. In industrialized countries, particularly those affected by World War II, the heavy investments in new systems carried out in the 1950's, 1960's and 1970's are ag‐ ing fast, partly due to inadequate or deferred capital maintenance. This places an additional demand for efficiency in planning for the future. In developing regions, the shortage of fi‐ nancial and technical resources further add to the need for their well-judged, efficient use in

With the current lack of planning and capital maintenance, the services that are taken for granted in many societies are placed into an increased risk of failure, at least from the view‐

Regardless of their size, complexity and level of maturity or development, water utilities need to implement structured IAM approaches that may ensure the sustainable manage‐

the tactical objectives, in full alignment with the utility's strategic objectives.

**8.3. Benefits of using a structured IAM approach in the example utility**

ed proficient answers to all the questions initially formulated:

ent to the existing system (A0).

to quantify their impact.

**9. Concluding remarks**

a long-term perspective.

point of the levels of service currently provided.

atic ones.


**Table 5.** Case study: results obtained from the evaluation of three alternatives at year 5

**Figure 5.** Metric results expressed as a 3D *cube*; left axis: time; right axis: metrics; vertical axis: alternatives.

Experience shows that it is often less costly simply to repair pipes and pay for the water lost in leakage than to invest in the rehabilitation of the system. This was confirmed here by looking at alternative A0 at year 5. However, for the remainder of the analysis period (yrs. 6-20) the problems identified in the diagnosis become increasingly evident, through poorer network reliability and moderate water losses that tend to intensify due to normal wear.

The results for A1 show that it is generally better than A0 is terms of infrastructural sustain‐ ability, water losses and risk (IVI, AC and UnmetQ). Investment is of course higher than in A0, but within the available budget. However, A1 perpetuates the design deficiencies inher‐ ent to the existing system (A0).

Alternative A2 aims at realistically and progressively bring the existing network to a config‐ uration closer to the ideal. Its resilience is improved when compared to A0 and A1, as it re‐ inforces the options for supplying the network from an alternative supply point. Investment costs are higher than for A1 (350 vs. 274cost units). The percentage of asbestos cement pipes is also significantly reduced (to 8.5%, from 37% for A0). This alternative displays the best allround long-term balance of performance, risk and cost, as expressed by metrics that reflect the tactical objectives, in full alignment with the utility's strategic objectives.
