Functional and residual capital values as criteria for water pipe renewal

Water pipes are considered as tangible assets designed to provide a level of service throughout an expected lifetime. The asset can be characterised by two types of values: capital or accounting value and functional value. The capital value of assets depreciates according to a specific rate per time period. The depreciation is assessed by the annual amortisation of the capital asset, which constitutes a potential self-budgeting for future renewal. The development in the last 20 years of public sector accounting standards boards dedicated to tangible capital assets management has encouraged water and wastewater utilities to consider capital depreciation as a decision-making criterion for asset prioritisation. At the same time, when the capital depreciates the asset function deteriorates, but this deterioration is more difficult to assess. In fact, each asset can be evaluated according to a functional value that indicates the capacity of the asset to deliver the designated service at the required level. This value declines during the service life because of the occurrence of unexpected events (failures, breaks, leaks and degradation). The functional deterioration, also referred to as ‘obsolescence’ or ‘reliability’, is still misunderstood for water pipe assets. This study addresses the following questions: How can the functional value be estimated for water systems both at the pipe and at the network scale? How can the decision-making process for pipe renewal be improved by incorporating specific indicators based on both functional and accounting values? The current research focuses on the definition of an appropriate time-dependent functional value, based on the following hypothesis: the functional value depends on both structural and hydraulic deterioration of the pipe asset, but is partially restored by curative maintenance actions. The calibration of the functional value is mainly based on historical incident data, roughness data and managers' opinions. In order to carry out the decision-making process, the evolution of the functional value is simultaneously analysed with the depreciation of the capital asset value. The implementation of the approach at the pipe and the network level leads to an assessment of innovative criteria for the purpose of assessing possible renewal policies.     

Performance analytics for regulation in retail water utilities: Guiding asset management by identifying peers and targets

This research evaluates the performance of water supply utilities operating at the retail level in Portugal concerning asset management practices. The study’s main innovative feature is identifying peers and targets to guide improvements in the sector. Reliable data collected by the regulatory authority for water and waste services in Portugal (ERSAR) are employed to design two composite indicators reflecting different dimensions of asset management: operational conditions and management systems. Based on the Data Envelopment Analysis technique, the Benefit-of-the-Doubt model is employed in robust and conditional formulations. The role of the context on utilities’ performance is also investigated. The results show that the direct management model is unfavourable concerning developing structured management systems, whilst urban environments favour managerial advancement. Rural and semi-urban environments favour “good” operational results in infrastructures. The pool of peers obtained for each utility and the quantification of targets based on the observed achievements by those peers facilitates the search for industry best practices and promotes continuous improvement. Given the high heterogeneity in asset management performance within the sector, the utility-specific target-setting approach illustrated in this paper can support a regulatory policy review for determining more realistic goals.     

Uneven development and the commercialisation of public utilities: A political ecology analysis of water reforms in Malaysia

Water policy reforms introduced in Peninsular Malaysia have yielded relatively positive improvements in the operational and financial performance of water utilities. This article analyses contemporary water governance in the context of the historical origins of uneven water development in Malaysia and national heterogeneity in the political economy of water provision. The investigation builds on political ecology scholarship in urban water policy and reaffirms postcolonial critiques of neoliberal inspired water reforms in developing countries. Our study analyses the impact of the ‘asset light policy’ – a policy introduced in 2008 with the aim of commercialising public water utilities and centralising water sector investment and ownership. It is found that notwithstanding evidence of improved financial health and technical efficiency in certain states, the asset light policy has accentuated uneven water development across the country. Thus despite the policy's relatively narrow focus on technical and financial matters, it is shown to have a fundamentally political outcome. This in turn explains the current ‘policy impasse’ in five of the eleven states in Peninsular Malaysia. Furthermore, the omission of environmental considerations within the policy framework is argued to undermine the overall ambition of the policy. It is recommended that water policy makers give greater consideration to the embedded social, political and economic inequalities that characterize many former European colonies.     

Sustainability assessment in strategic management of wastewater transport system: a case study in Trondheim,Norway

Sewer networks represent high value in water infrastructure assets and it is important to develop and operate them by specified sustainable management. This paper presents the results of a sustainability analysis on the wastewater transport system of Trondheim, Norway, for future planning (2014–2040) from a metabolism-based performance analysis by the Dynamic Metabolism Model (DMM). The aim of this work is to demonstrate a methodology for comparing different pathways toward a sustainable management of wastewater systems. For this purpose, four intervention strategies ‘infiltration and inflow reduction’, ‘increasing rehabilitation rate’, ‘extension of system regarding population growth’, ‘energy management’ along with different combinations of them have been analysed. The results of this study may give some support to decision-makers in wastewater departments. In practice, to achieve strategic level planning of sustainable sewer asset management, it is vital to assess different aspects of sustainability and manage them in a comprehensive system.     

Using optimisation for integrated water network management

The water industry has undergone radical change in the late 1980s and changes continue apace. We have been, and will continue to be, under increasing pressure to reduce costs and increase service within a framework where regulations are becoming tighter and demanding more information to achieve and substantiate performance. The major challenge will lie with the leaders of the industry. They have to achieve the right attitude, management technique and technical excellence to meet the requirements of change and to create adaptable organizations that can manage the challenges of change in a positive and proactive way. Cultural change has started but has a long way to go. We must overcome the traditional attitude of many water suppliers, which has typically been one of the ‘professional stewardship’ of a resource in which they supply water in the way they believe to be best. This must change and is changing to a more commercially minded management which is ‘customer centred’ rather than ‘product centred’. We must realize that our organizations manage a complex asset base which has to work towards strictly defined objectives of service quality, operational efficiency and regulatory requirements, all of which, as time goes on, are influenced more and more by substantial external forces.     

Innovation districts and urban heterogeneity: 3D mapping of industry mix in downtown Sydney

Economic heterogeneity is an intrinsic characteristic of cities, but it varies greatly within and between urban areas. The economic relationships and specific mix of service industries are important keys to the management and design of innovative urban districts that support the knowledge economy. Although heterogeneity is accepted as a general ‘good’ within urban design, the concept has not been approached systematically with specific physical relationships between industries, uses and the spaces they occupy generalized as ‘mixed-use zones’. This paper critically reviews the concept of mixed-use and investigates the concept of 3D heterogeneity using a fine-grained geographical information system (GIS) dataset to scrutinize spatial and economic characteristics of a commercial downtown ‘innovation district’ in global Sydney.     

Sewer asset management – state of the art and research needs

ABSTRACT

Sewer asset management gained momentum and importance in recent years due to economic considerations, since infrastructure maintenance and rehabilitation directly represent major investments. Because physical urban water infrastructure has life expectancies of up to 100 years or more, contemporary urban drainage systems are strongly influenced by historical decisions and implementations. The current decisions taken in sewer asset management will, therefore, have a long-lasting impact on the functionality and quality of future services provided by these networks. These decisions can be supported by different approaches ranging from various inspection techniques, deterioration models to assess the probability of failure or the technical service life, to sophisticated decision support systems crossing boundaries to other urban infrastructure. This paper presents the state of the art in sewer asset management in its manifold facets spanning a wide field of research and highlights existing research gaps while giving an outlook on future developments and research areas.     

Awareness development for an energy management program for social housing in Canada

Social housing organizations compete with other social causes for limited public and private sector funding. While the environmental impact is important, it must be recognized that for most social housing organizations the most appealing aspect of an energy management program is the reduction in operating costs through reduced energy consumption. In order to secure financial resources for an energy management program, organizations will need to identify and address stakeholder perspectives in the formulation of ‘marketing’ strategies. The ‘marketing’ of an energy management program would be aimed at illustrating the substantial financial savings that can be achieved by increasing energy efficiency in social housing units. The bonus of an energy management program is the contribution towards environmental conservation and initiatives such as the Kyoto Protocol, as increased efficiency in energy usage and the subsequent reduction in overall energy consumption in social housing units contributes to reducing Canada’s greenhouse gas emissions.     

Water Meadow Management in Wessex: Dynamics of Change from 1800 to the Present Day

Relatively little attention has been given to post-1800 changes in water meadow management. Before this, many ‘bedwork’ systems originally provided grazing within sheep-corn husbandry but this changed in the nineteenth century when water meadows provided grazing for dairy herds and grew hay crops. Using oral and published accounts, this paper explores changes in management from water meadows as heavily invested agricultural systems to ecological, hydrological and landscape service providers today.     

Improving water governance in Central Asia through application of data management tools

Contemporary water management decisions use many sources and forms of data. The paper discusses the implementation results of data management activities in the water sector carried out in five countries of the Central Asia region. Geoinformation systems, remote sensing tools and databases have been applied worldwide for improving water resources management with differing levels of success. Water management organisations, equipped with data management tools will have better capacities to adapt their decision-making in the changing availability and scarcity of water resources. Application of data management tools for improving collection, storage and processing of data and information are a first step towards improved water governance.     

A sustainability assessment of decentralized water supply systems in Bandung City,Indonesia

Decentralized water supply systems (DWSS) are a form of community-based water supply infrastructure common in developing countries. These systems address the limitations of centralized water supply systems (CWSS), but one issue of DWSSs is their sustainability. Therefore, it is urgent to identify the inhibiting factors for their sustainability. This study assesses the level of sustainability of two prevalent types of DWSS in Bandung City: public wells and communal networks. The article shows that three critical factors must be considered to ensure the sustainability of DWSSs, namely structured organizations, community participation, and financial resources. This study also finds informal practices in the management of DWSSs that contribute to the system's sustainability. The study offers policy recommendations to improve the sustainability of existing and future DWSSs. Specifically, the study recommends forming DWSS institutions, improving community participation, implementing a tariff system as a source of funding and a way to conserve water, and lastly, integrating DWSSs and CWSSs.     

Development and implementation of an asset management framework for wastewater collection networks

This paper presents a framework to develop, implement and communicate a multi-perspective asset management plan for wastewater collection networks. The framework takes into account four strategic perspectives – socio-political, financial, operational/technical, and regulatory – and devises four strategic themes for sustainable wastewater collection systems.The asset management strategic themes, perspectives, and strategic objectives were developed from the proceedings of collaborative working sessions held at the first Canadian National Asset Managers workshop in 2007 in Hamilton, Ontario. The themes and strategic objectives are illustrated in a strategy map and detailed in the modified balanced scorecard model. A case study based on real data presents the use of business intelligence tools to implement, monitor, and report various components of the proposed framework.The proposed framework provides a unified gateway for efficient and effective management of wastewater collection systems. It can be adapted to devise and implement strategic asset management plans in comparable organizations, and to comply with the new legislative requirements that demand increasing accountability to meet stakeholders’ expectations, protection of public health and environment, efficient allocation of funds, and greater disclosure.     

Water services performance: do operational environment and quality factors count?

Decision makers must keep in mind that water services have an invaluable ‘price’ for the public budget and society’s welfare. However, due to the specific features of the service, water utilities are prone to inefficiency. Thus, performance evaluation becomes indispensable to face this constraint. Besides the application of the traditional technique of Data Envelopment Analysis to evaluate the performance of Portuguese water utilities, this study also implements the robust technique of order-m to assess the influence of operational environment on water utilities’ performance. In spite of several reforms, the Portuguese water sector still reveals significant levels of inefficiency, partially caused by an inappropriate operating scale. Concerning the operational environment, it was possible to observe a positive influence of private sector participation, economies of scope, and groundwater sources on efficiency. The influence of the ‘quality of service provided’ was also studied in this performance analysis.     

HAZard and OPerability (HAZOP) analysis for identification of information requirements for sewer asset management

Asset management is a prerequisite for maintaining the required level of serviceability of urban drainage systems. The required asset management effort to achieve a certain level of service is unclear due to limited knowledge on sewer systems process and structure complexity. Sewer failure mechanisms explain the structural/operational failures of sewer elements. This paper describes a method for assessing sewer failure mechanisms as a first step to identify information needed for sewer asset management. In order to be able to identify the main processes and defects responsible for the structural/operational failures of sewer elements, as well as the possibility of obtaining the information about them, a HAZard and OPerability (HAZOP) approach was applied. HAZOP results were, due to the nature of the analysis, rearranged in such a way that they can be applied in Failure-Tree Analysis (FTA) for the purpose of further risk estimation.     

Transition to a water-cycle city: risk perceptions and receptivity of Australian urban water practitioners

Transition to a water-cycle city, a sustainable urban water management future, requires the implementation of centralised and decentralised systems to augment potable water supply, protect waterways and enhance urban liveability. Risk is simultaneously driving and impeding this transition. However, risk perceptions of water practitioners and how they affect practitioner receptivity to future modes of urban water supply are poorly understood. This study characterises risk perceptions and attitudes of Australian urban water practitioners towards alternative water systems and uses a receptivity framework to suggest how receptive practitioners are to these systems. Differences between cities are identified, suggesting how familiarity might influence receptivity. These results can inform strategies to enhance receptivity, including improved communication within the water industry and beyond with its various stakeholders, improved cost-projection frameworks to provide a quantitative metric of the benefits of sustainable water options, and a shift from ‘learning to manage’ to ‘managing to learn’.     

Comparison of engineering costs of raw freshwater, reclaimed water and seawater for toilet flushing in Hong Kong

Hong Kong is one of the very few coastal cities in the world that use ‘dual water supply systems’. Dual water supply involves two distribution systems: a freshwater system for potable use and a seawater system for toilet flushing. This study looks into the feasibility, from an engineering cost point of view, of extending seawater supply into districts where potable water is still being used for toilet flushing, including South District of Hong Kong Island, Sai Kung, Northern New Territories and Northwest New Territories. Besides seawater, raw (untreated) freshwater and reclaimed water (treated effluent from local sewage treatment works) are also considered to be used for toilet flushing for these districts. Six cases are developed for comparison by using the lowest net present value of cost criterion. The result shows that using seawater for toilet flushing in these districts has the best engineering economy.     

Re-examining the ‘low water tariff’ hypothesis: lessons from Hyderabad,India

Researchers suggest urban water utilities in India operate on low tariffs, consequently earning revenue insufficient to recover operation and management (O&M) costs of water storage, treatment and distribution. From findings of a field study conducted in Hyderabad, India, the paper suggests otherwise. While ‘stated’ tariffs are low, households currently pay tariffs far higher than in other regions of the world because of institutional indifference toward improving service attributes, particularly quantity and poor measurement of domestic water consumption; following which, poor communities pay more for less. While poor cost recovery precludes improved performance of urban water utilities, targeting this facet alone at the cost of other aspects of service does not, as the paper demonstrates, necessarily lead toward qualitative service improvement or toward improved households' perception of water services.     

Accounting for Polycyclic Aromatic Hydrocarbons in Public Water Supplies

Asset management plans were prepared in 1989 and 1994 by water companies in England and Wales for submission to the Office of Water Services. These plans constituted the financial programming required by water companies to meet specified standards of service, particularly with respect to water quality. Detailed studies have previously established that problems associated with iron from unlined ferrous mains, particularly in soft water areas, is often the main cost 'driver'for water distribution investment. However, many of the so-called unlined iron mains were treated with a coal-tar pitch lining for corrosion protection before installation, and residues of this painted lining can give rise to unsatisfactory levels of polycyclic aromatic hydrocarbons in drinking water.
The paper describes how desk-study research, followed by the development and application of a modified 'focused downstream series sampling'water-quality modelling technique allowed polycyclic aromatic hydrocarbons to be accounted for in two water company asset management plan submissions. The paper also raises a number of fundamental implications with respect to the occurrence of these carcinogenic compounds in drinking water.     

Testing Home Ownership as the Cornerstone of Welfare: Lessons from East Asia for the West

In recent years, one driver behind the promotion of home ownership in Western countries has been the belief that owner-occupied housing assets provide a means to build up individual welfare security, potentially offsetting pension shortfalls in retirement. In contrast, many developed East Asian societies have both long focussed on advancing ‘asset’ or ‘property-based welfare’ systems as well as experienced the late-1990s Asian Financial Crisis which forced changes in housing and welfare practices. This paper examines how home ownership and asset-based welfare fared in these contexts and the lessons to be learned. It begins by considering the role of owner-occupied housing assets in different welfare regimes before empirically examining how asset-based welfare systems have been realized. It then considers how East Asian home ownership and asset-based welfare systems have stood-up to economic crises. The final section considers what the East Asian experiences contribute to an understanding of the housing assets–welfare relationship.