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Case study 3.7

Asset management for public entities: Learning from local government examples.

Wellington City Council – Asset condition is only part of the story – taking other factors into account helps ensure that assets are renewed close to the optimum time

Wellington City Council has followed good practice by assessing the condition of its assets. It has a formal asset condition grading system in place. This includes a condition grade profile that distinguishes, for example, between pipes of different materials. It uses this to inform maintenance and renewals planning. However, asset condition is only part of the story as the Council strives to renew its assets at the optimum time.

The Council's approach to wastewater planning provides a good example of how to use condition information effectively in planning work on assets.

Taking into account a range of factors provides a sound basis for forecasting the cost of future renewals

Wellington City Council’s renewal planning is informed by both the remaining useful life of the assets and good quality information on their condition. The Summary Wastewater Plan sets out the basis for asset renewals, stating:

Longer-term asset renewal needs are identified through analysis of condition assessments. More detailed, shorter-term prioritised programmes are developed with reference to failure history, risk assessment (including consideration of financial, environmental and social implications of failure), and, in the case of critical drains and plant items, CCTV* and visual condition assessments and site inspection information. Assets are therefore renewed when analysis indicates it is more cost effective in the long term to replace rather than continue to maintain it.

* Closed-circuit television.

To inform longer-term renewal planning, the Council has developed a 100-year "renewal curve".

This allows an analysis of renewal and financial planning options that extend beyond the LTCCP time frames. For example, in the diagram below, the magenta line indicates how spending could be spread consistently for the 100-year period in an ideal world with a controlled environment and no influences from external or operational factors.

In reality, the generation of renewal-based work from requests for service, asset failures or investigations, affects the amount of renewals that are actually carried out – this is reflected in the red line which reflects the Council’s undertakings in reducing the sharper effects of the blue renewal "profiles".

The blue "profile" lines take into consideration the age of the asset, results from condition surveys, and any proposed renewals programmes.

updated wastewater pipe renewal forecasts