Introduction to Water Infrastructure Asset Management - Global Drinking Water Management and Conservation - page 147

7.1.1 Infrastructure Management in Canada

Canada ts of asset management including:

facilitation and implementation of a plan; performance measurement; crisis aver-
sion; cost and risk reduction; improved, continuous and consistent levels of service
and better communication; return on investment and performance.
However, there are also three main challenges identi

' s Infraguide ( 2013 ), identi es 13 bene

ed: asset management must
be supported by senior management and comprise a key role in the municipality ' s
business plan; the management plan must consider the life cycle of assets and the
database utilized must be relevant and be up to date.
There are four key principles of asset management: it is

“ a strategic and pro-

active approach (Infraguide 2013 ) that appreciates quality information and col-

laboration across both departments and disciplines; its vision is long term with
respect to performance and cost with an emphasis on sustainability; it is a trans-
parent method that obliges those involved to communicate in a meaningful way;
and it involves business processes that base investment decisions that have clearly
de

”

ned tradeoffs on policy and performance objectives.
The report identi

es seven requirements of asset management. It must be rec-
ognized that all assets have a monetary value. There are seven stages in the life
cycle of an asset (planning, design, construction, operation, maintenance, rehabil-
itation, and replacement); decisions in each stage have implications for other stages.
The objectives must be sustainable in that the present needs are met without
compromising the needs of the future. The asset management and financial plans

should be integrated in order to enable the establishment of a quanti able link

between the level of service and the cost. Expected risk must be monitored
(measuring all potential risks) to ensure that it is below some predetermined
maximum tolerance level for risk. The performance of the assets must be monitored
to ensure the ideal balance between cost, service, and risk.
The framework of asset management is described as a series of questions that
address the policy objectives, funding limitations, inventory and condition, replace-
ment costs, capital and operating plans and short and long-term

financial plans. The

policy objectives (level of service and acceptable cost) should re ect the values of the

community and be directed by elected of cials and municipal administration.

Asset management requires a detailed inventory (location, age, material, length
and diameter of pipes, etc.). Replacement costs need to be enumerated to plan for
infrastructure renewal. Life cycle costs and social costs must be considered for each
asset. Estimated replacement dates for infrastructure need to be established and
periodically updated; updates can be conducted through the assistance of deterio-
ration modeling and predictions of usage. Based on the estimated replacement dates
and renewal costs, projected cash flow requirements can be established to ensure

that an adequate source of funds is available when needed; this will assist in cost
containment and avert an unplanned service interruption. The

financial plan should
be of a temporal duration that would allow for possible cost increases; a duration
that includes one life cycle of the longest lived component is suf cient.