Sustainable AssetManagement Planning
Tony Miguel
17 June 2005
A plan developed for the management ofone or more infrastructure assets thatcombines multi-disciplinary managementtechniques (including technical andfinancial) over the lifecycle of the asset inthe most cost-effective manner to provide aspecified level of service. A significantcomponent of the plan is a long-termcashflow projection for the activities.
Asset Management Plan
•90% of costs of infrastructure service deliveryare due to the physical assets
•10% administration & overheads
•50% of assets created by developmentand subdivisions
•The challenge for asset managers is achievingsustainable asset management and addressingthe life cycle costs and consequences
Lifecycle Costs
•Build a pipeline/footpath/road/park worth $2million
•Useful life, say 50 years
•Life cycle cost
•- Depreciation $2,000,000 ÷ 50= $ 40,000pa
•- Loan repayment= 100,000pa
•- Maintenance @ 0.5%= 10,000pa
•- Management= 1,000pa
•Annual cost $151,000pa
•Total lifecycle cost $151,000 x 50 years= $7.55 million
•Little opportunity for change once the decision has been made
•Key questions: Do we need the asset, what is the level of service?
Lifecycle Costs
Drivers
•Legal
-LGA 2002 (Social, economic, cultural and environmental)
- RMA 1991(Sustainable management)
- LTMA 2003 (Sustainable transportation)
•Strategic Platforms
•Community/customer expectations
•Standards
- Auckland Regional Council: Air, Land and Water Plan
-Transit NZ
•Growth
- Population
- Economic
•Asset Condition
Asset Management Planning Process
Cost / Benefit /Risk /Affordability
AssetManagementPlan
LTCCP
CommunityOutcomes
StrategicObjectives
Levels ofService
Asset capacityand condition
Optionsincluding non-asset
Integration
•Roads, Parks, 3-Waters, Property, commonpriorities, affordability
•Multi-discipline approach
•People
•Systems
Process
•Consultation on Levels ofService
•Consultation on Assessmentof water, wastewater andsanitary services
•Develop sustainable, robust,affordable Asset ManagementPlans for 2006 LTCCP
•Consultation on assessmentof water, wastewater andsanitary services
Strategies
•Water Strategy
•Transport Strategy
•Development Contributions
•Parks Strategy Review
•Leisure Strategy
Conclusion
•In Auckland estimated Capex $15 to $20 overnext 10 years
•Sustainable management required tominimise costs and adverse effects oncommunities and environment