Merging top-down and bottom-up planning approaches

This blog series explores the complex tasks energy utility companies face as they transition to holistic grid asset management to manage through the energy transition. The first post in this series addressed the challenges of energy transition through holistic grid asset management. The second post in this series discussed a unified asset management platform and data exchange that integrates business disciplines from different domains into one network.

Breaking down traditional silos

Many utility asset management organizations work in silos. A holistic approach that combines siled processes and integrates various plan management systems provides optimization opportunities at three levels.

1. Asset Portfolio (AIP) Level: Optimal Project Execution Schedule
2. Asset (APMO) level: optimal maintenance and replacement timing
3. Spare Parts (MRO) Level: Optimal Spare Parts Stocking Level

As shown in the following figure, a combined planning exercise creates a budget for capital expenditures (CapEx) and operating expenses (OpEx) and establishes minimum requirements for grid outages over the future planning horizon.

Asset investments are typically part of the grid planning department, which considers expansion, load studies, new customers and long-term grid requirements. Asset investment planning (AIP) tools provide value in optimizing multiple, sometimes conflicting, value drivers. They combine investment in new assets and replacement of existing assets. However, different approaches to risk management are followed, using risk matrices to assess risk at the beginning of the optimization cycle. This top-down process is effective for new assets because there is no information about the asset. For existing assets, a continuous condition monitoring process allows for a more accurate bottom-up risk approach. This process calculates condition index and useful life based on the asset’s specific degradation curve. Dynamic condition monitoring provides up-to-date risk data and accurate replacement timing, unlike the static approach used in AIP. Combining Asset Performance Management and Optimization (APMO) with the AIP process uses this enhanced estimation data to optimize in real time.

Maintenance and project planning take place in the operations department. The APMO process creates an optimized work schedule for maintenance tasks over the life of the project and calculates the optimal replacement timing for existing assets at the end of their life. Maintenance and project planning systems load these tasks for field service departments to execute.

In terms of maintenance repair and overhaul (MRO), spare parts optimization is linked to asset criticality. Failure Mode and Effects Analysis (FMEA) defines maintenance strategies and associated reserve holding strategies. Key parameters are optimizing inventory value, asset criticality and spare parts ordering lead times.

Traditional planning processes focus on different planning cycles for new and existing assets in top-down and bottom-up asset planning approaches. This approach leads to sub-optimization. An integrated planning process uses a three-level optimization engine to break down departmental silos. Optimized planning reduces downtime and system downtime and increases efficient use of scarce resources and budgets.

Read more about IBM® Maximo® APM for Energy and Utilities.