**8.1. Strategic planning in a midsize utility**

The vast majority of water utilities in the world serve populations of less than 100 000. Most midsize utilities have room for significant improvement in terms of infrastructure asset management. This specific example arises from Portugal, where the water services regulator enforces a national system for quality of service assessment, and concerns a midsize utility in a developed urban area (more detail can be found in Marques *et al*., 2012). Service cover‐ age is no longer an issue, but the assets are aging, and the service is not as financially and environmentally efficient as desirable. Quality of service, transparency in investment priori‐ tization and environmental sustainability are the key IAM drivers for the managers.

The utility adopted the objectives and assessment criteria of the regulatory system, as they were deemed adequate for their own internal strategic purposes. Operating exclusively as a retail services utility, they selected the applicable metrics and targets from the regulatory system (Table 2). Each metric is clearly defined, with units, definition, assessment rule and specification of the input variables.


Taking these objectives into account, a SWOT analysis was carried out (Table 3).

**Figure 4.** The long-term balanced design planning process

by the first blue horizontal at the top).

62 Water Supply System Analysis - Selected Topics

**8. Examples from the industry**

**8.1. Strategic planning in a midsize utility**

to the extent possible.

The drawing board on the right-hand side is initially marked out by the green vertical lines, representing the metrics for the criteria chosen to drive the analysis. A thorough diagnosis and assessment of the current system according to those metrics is carried out (represented

The planning board is then successively populated with the best available planning alterna‐ tives (represented by the subsequent blue lines). The intersections represent the assessment of each planning alternative for each metric. The purpose of the process is to fill out the table

The vast majority of water utilities in the world serve populations of less than 100 000. Most midsize utilities have room for significant improvement in terms of infrastructure asset management. This specific example arises from Portugal, where the water services regulator enforces a national system for quality of service assessment, and concerns a midsize utility in a developed urban area (more detail can be found in Marques *et al*., 2012). Service cover‐ age is no longer an issue, but the assets are aging, and the service is not as financially and environmentally efficient as desirable. Quality of service, transparency in investment priori‐

tization and environmental sustainability are the key IAM drivers for the managers.

**Table 2.** Objectives, assessment criteria and metrics of the Portuguese regulatory system


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.

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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.

**•** Have we satisfactorily dealt with the hydraulic problems? Were we able to allocate levels of service to each individual asset when dealing with pressures and water losses?

**•** 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‐

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

**•** Increase system reliability in normal and contingency conditions (see criterion 1.2, Table 2);

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‐

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.

**•** Ensure the infrastructural sustainability of the system (see criterion 2.2,Table 2);

They might ask some additional questions:

quate from the energy point of view?

objectives were set:

**•** How did we select the sizes and materials of the new pipes?

**•** Ensure economic sustainability (see criterion 2.1,Table 2);

**•** Decrease water losses (see criterion 3.1,Table 2).

mands, regulation, funding opportunities, economics).

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

**Table 3.** SWOT analysis summary

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‐ tem reliability*.
