Chapter
Jul 28, 2022
Lowering Risk through Data-Driven Capital Planning
Publication: Pipelines 2022
ABSTRACT
Citizens Energy Group identified a strategic initiative to incorporate a risk-based capital programming approach for seven business units within the Citizens. The goal of the approach was to develop risk-based, sustainable, and affordable long-term infrastructure investment scenarios. The purpose of the report is to (1) analyze existing system data for each business unit (BU); (2) create a comprehensive, centralized location for all capital needs to address risks and levels of service; (3) generate a consistent approach for all BUs; (4) evaluate existing performance data compared to internal targets and industry peers (where available); (5) identify the desired future state and associated programmatic needs to shift the approach from financial-based planning to needs-based planning; (6) support future rate cases through data-driven analysis; and (7) establish the financial impacts each condition has on the current program into the future. To do so, a risk-based approach was taken to identify areas of need and quantify the capital investment required to meet the associated levels of service (LoS) and performance targets through data-driven analysis. Each business unit (BU) was involved with identification of the top three risks to their BU and development of levels of service, including categories, performance measures, and performance targets. The risks and levels of service were correlated to quantify performance improvement and the corresponding risk mitigation resulting from each mitigation measure identified. A 20-year long range plan was developed to show the needs-based results to mitigate the highest three risks for each business unit.
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REFERENCES
IPWEA (Institute of Public Works Engineering Australia). (2015). International Infrastructure Management Manual. Fifth printing. IPWEA, Sydney, NSW.
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Published online: Jul 28, 2022
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1Citizens Energy Group. Email: [email protected]
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Terms of Use: ASCE Library Cards are for individual, personal use only. Reselling, republishing, or forwarding the materials to libraries or reading rooms is prohibited.