Utility companies carry substantial liability, not only for ensuring acceptable service delivery, but for damages and injuries resulting from malfunctioning assets and equipment. A utility pole that ends up crashing into someone’s roof is surely going to create an unhappy homeowner, and only sheer luck avoids serious injury in some of these situations.
At the same time, utilities are tasked with managing, maintaining, and repairing hundreds of thousands of assets, which may be spread out in the field across many miles of a service area. Being able to efficiently map the company’s assets, analyze data to pinpoint problem areas, and quickly identify assets in need of maintenance or repairs is nearly impossible with manual asset management procedures.
Asset management and risk management go hand-in-hand
Asset tracking with asset tags and bar code labels enables utility companies to instantly pinpoint the precise location of any asset in the service area, immediately access data on the most recent maintenance procedures and repairs, discover the field service workers in the closest proximity, and even reorder the correct parts. Beyond simplifying these standard processes, risk management overall aids utility companies in achieving the ideal balance between costs, risks, and performance; in other words, optimizing operations as a whole.
Risk management holds many benefits for utility companies, including:
- Recovering costs from capital investments
- Justifying investment needs to municipal and county leaders
- Demonstrating that infrastructure replacement programs offer the proper balance of cost, risk, and performance
If utility companies can demonstrate that rates are justified in terms of ROI and that maximum benefit is being gained from improvements to infrastructure, investment costs are easier to justify to stakeholders as the subject of rate increases is on the table. Asset management helps utility companies maximize the value of capital investments and manage operational and maintenance expenses through streamlining the renewal and replacement process which, for utilities, is a constant and ongoing process.
Optimizing service delivery and extending the usable life of assets
Only asset management makes it possible to maintain desired service levels at the lowest possible lifecycle cost, or the cost of replacing, rehabilitating, or repairing an asset. That’s because asset management enables the optimization of asset lifecycles by fool-proofing the maintenance and repair process. With asset management, assets are maintained efficiently, reducing the need for unexpected repairs and replacements, as well as extending the usable life of the asset by keeping it in the best working condition throughout its usable life.
The end result is consumers get optimized service levels and utility companies are able to meet consumer demands and usage requirements at the lowest possible cost. It’s for this reason that asset management is gaining widespread adoption among utility companies working towards achieving sustainable infrastructure, which is quickly becoming the expected norm in the modern environment.
Utilities benefit from robust data collection and analysis provided by asset management
The EPA points out that asset management programs provide valuable data that aids utilities in moving towards more sustainable infrastructure, including:
- Age of assets
- Condition of assets
- Criticality metrics – how critical is the asset in maintaining operations?
- Life-cycle costing
- Proactive operations and maintenance (O&M)
- Capital replacement plans based on cost-benefit analysis
Utilities armed with this critical data are in the best position to ensure that systems remain in good working order and are able to meet not only consumer demands, but regulatory requirements as well. Additionally, the EPA outlines several advantages of asset management beyond robust data collection and analysis:
- Prolonging the life of your assets
- Meeting consumer demands while focusing on system sustainability
- The ability to set rates based on precise operational and financial planning
- Effective budget allocation based on prioritizing the most mission-critical assets
- Improved, efficient emergency response
- Enhanced safety and security of assets
- Cost reductions in operations and capital expenses
If your organization is working towards achieving a more sustainable infrastructure, struggling with budget limitations and the need to replace critical assets, or seeking more efficient risk management methods, asset management is the key to transforming your operations.