Introduction to Water Infrastructure Asset Management - Global Drinking Water Management and Conservation - page 157

the population against the risks of water provision is to reduce the risk. The utilities
need to identify a maximum level of risk and then maintain and renew assets in
order to meet this standard in the most cost effective way.

7.2.2.5 Other Risk Considerations

There are other considerations that need to be addressed when discussing risk. Two
of these other considerations that merit special mention are risk tolerance and risk
aversion. Risk tolerance refers to a certain amount of risk being tolerable. If there is
no risk tolerance, the only way to protect an entity against risk is to eliminate it —

which has already been ruled out. A certain amount of risk must therefore be
tolerable, and this amount must be determined.
Another consideration is that of risk aversion. Given the choice between two
options that yield the same expected risk and varying degrees of variance of risk,
the utility should pick the option with a smaller variance. The reason for this is that
when operating within a narrower interval, the utility can reduce the chances of
catastrophic risk. Moreover, if the risk turns out to cost a little more than the
expected value, then the cost can be recovered through small price increases. If the
cost turns out to be much higher, then these prices increases will have to be much
larger. There is rarely opposition to utilities that wish to decrease their rates due to
cost reduction, whether the cut is large or small. However, as utilities attempt to
increase rates, the opposition will become much stronger as the increase gets larger.
A smaller risk variance enables the utility to plan better and enjoy political support.

7.2.3 Redundancy

There are three essential levels of redundancy: no redundancy, looped redundancy,
and latticed redundancy. Looped and latticed redundancies have the added bene

t

of no lead to bacteria buildup due to lack of

movement of water in the pipes. However, the focus of this section is to explore the
different types of redundancy in order to determine which type will lead to the
lowest probability of interruption. It will be shown that the best type is latticed
redundancy, through which service continuity can be met without sacri

“ dead ends. ” These “ dead ends ”

cing health

and safety objectives.

7.2.3.1 No Redundancy

A system without redundancy is also known as a straight-line system. The flow of

water through this system originates from a reservoir or treatment plant and ows

through a main of a given length. This main would consist of a number of con-
nected pipes. Valves would also be spaced out throughout the system to create