Irish Water Capital
Investment Planning
CIWEM/ Engineers Ireland
7th April 2014
John Casey
Asset Strategy & Sustainability Manager
Irish Water
1
A function based organisation with a regional
presence
•
Irish Water
– Headquarters in Dublin and a services function in Cork
– Three regions and 8 regional offices
3 Regions
Eastern / Midlands
8 Regional Offices
Dublin City
Mullingar
Castlebar
Connaught/Ulster
Cavan Town
Donegal Town
Kilkenny City
Southern
Limerick City
Mallow
2
SLA
Overview
Governance Arrangements
Important Inputs
Customer /
Stakeholder Needs
Develop Service Plan
Rolling 5 Yr Plan
Deliver Service Plan
Annual Review
Deliver Transformation & Change
• Capital Investment
Clear Roles &
Responsibilities
Commitment to
Collaboration
Commitment to
Continuous
Improvement
Annual Service Plan
• Key objectives
• Performance
• Activities
• Change Prog.
• Headcount
• Budget
Continuous Improvement Cycles
Operate & Maintain Assets
Continuous Improvement Cycles
Manage Performance & Costs
Dispute Avoidance & Issue Resolution
3
Decisions
• Key objectives
• Activities
• Change Prog.
• Funding
Regulatory Context
New Water Services
Regulation
CER
HSA
Employment &
Growth
DECLG
IW
+
LA
HSE
EPA
4
Customer
Service &
Affordability
Environmental
Protection
Balance
Sustainability
Objectives
Building a Sustainable Water Service:
Asset Management Approach
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Will drive Investment Planning based on asset data and defined needs
Relies on full Asset data including Operations workflow & costs
Makes optimum use of available resources
Ensures the right projects are selected and delivered in the right way
Promotes best use of existing assets – capacity & risk models
Balances Capital & Operational investment – whole life view
Promotes a consistent set of policies & standards across asset base
Supports a sustainable business model-present & future needs
Promotes risk management as a key focus to target investment
Asset Management will drive both operational & capital investment
based on sustainability principles
5
Building a Sustainable Water Service:
Funding and Investment Drivers
Drinking Water Quality
Drinking Water Availability
Environmental Compliance
Wastewater Availability
Meeting Customer Service Obligations
Business Efficiencies
Asset Condition & Performance
6
Enhancement
Enhancement /
Growth
Enhancement
Enhancement /
Growth
Enhancement
Enhancement
Capital
Maintenance
Building a Sustainable Water Service:
Development of Investment Programmes
Irish Water Strategic Investment Plans
Water Services Strategic Plan (25 Year)
This will inform / be supported by Specific
Strategies:
• Water Resources Management Plan
• National Sludge Management Plan
• Climate Change and Adaption Strategy
• WSPP sets out high level
strategic objectives
including alignment with
Economic and Spatial Plans
• Will be required by
legislation
• Will require Ministerial
approval
DECLG
Price Control Period – Investment Plans
Capital
•
Stakeholders: LA’s,
Regional Authorities,
Customers/Citizens
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Financial Regulator CER
Environmental
Regulator - EPA
7
Major Projects
Small Capital
New Connections/Developer Services
Surveys & Studies
•
Investment plans submitted to
CER
First full regulatory period
2017-2021 (TBC)
Interim Investment Period
2014 – 2016
Asset Management Function in Irish Water
Irish Water
Asset
Management
Asset Strategy
Asset Investments
Asset Programmes
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8
Asset Policies &
Standards
Asset Information (Data
& Models)
Asset Strategies
Investment Planning
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Investment Options
Analysis
Portfolio Management
Performance/
Benefits Review
Water Supply Programme
Wastewater Programme
Small Capital Programme
Contract Strategy
Developer Services
Asset Management Systems
Irish
Water
Asset Hierarchy
• Maximo
• Primavera
• Oracle
• GIS
• SCADA
• Hydraulic Models
 Asset inventory and database
 Asset condition and performance
 Asset maintenance
• Planned
• Reactive
 Workflow management
 Cost Capture
 New connections assessment
 Project Management
 Portfolio Management
BELOW
GROUND
WASTE
WATER
WATER
TREATMENT
L3
Business
Level
L3
Regional Level
(SLA)
FACILITIES
(Buildings)
L6
Process
Level
L7
Stage
Level
Cake
Storage
WATER
SUPPLY
ZONE
WATER
TREATMENT
PLANT
L5
Installation
Level
Abstraction
& Intake
Works
Submersibl
e Pumping
Station
Convey
or Unit
Chemica
l
Recepti
on &
Storage
REGION 3
REGION 2
REGION 1
L4
Chart of
Accounts Level
(Financial)
Chemical
Prep
9
ABOVE
GROUND
L1
Regulatory/Tariffs
Sludge
Dewateri
ng Plant
Dirty
Wash
water
Tank/Sy
stem
In-Line
Pumping
Station
Sludge
Screenin
gs
Handlin
g
Odour
Treatme
nt Unit
PUMPING
STATIONS
ABSTRACTION
Borehole &
Adit
Borehol
e
Pumping
Station
Dam
Structur
e
Facilities
Pipe
Recepti
on
Sludge
Screening
Facilities
Utilities
•River Basin Attributes/EU Directive
2000/60/EC
•Local Authority Attributes
Micro
Strainer
Utilities
Tanker
Loading
Power
System
Screening
- Coarse
WATER
STORAGE
SLUDGE
MANAGEMENT
Screenin
g - Fine
Power
System
Control
Systems
Environmental
Common Site
Services
Dam
Structur
e
Reservoi
r Draw
off &
Scour
Reservoir
Inlet &
Bye Wash
Reservoi
r
Overflo
w
Water
Tower
Sludge
Thickeni
ng Plant
Liquor
Treatme
nt
Tanker
Receptio
n
Odour
Contain
ment
Inter
Stage
Transfer
Control
Systems
Environmental
Commo
n Site
Services
Sludge
Storage
Approach to Investment Planning – Enduring
• Previous Approach
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WSIP high investment on relatively
small number of schemes including
high growth provision
Under-investment on large number
of schemes
Under-investment in capital
maintenance
• Future Approach
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All schemes considered for
investment
Greater spread through small
capital / more targeted investment
Growth provision
“just in time”
Benefits of standardisation and
innovation
IW Future Process
Assess Current
Performance &
Risk
• Asset
Management
10
Future
Needs
Analysis
• Regional and
LA consultation
• EPA
Engagement
Gap Analysis
Define and
Optimise
Projects
• Capex
• Opex
• Small
Capital
• Bundling
Finalise
Investment
Plan
( 6 year )
• Drivers
Prioritisation
• Cost Benefit
Analysis
Submission
to CER
Investment Planning Process 2014 – 2016
Project Sources
• WSIP
• RAL
• AER
• Small Capital
• Strategic Studies
Investment Need by
Driver
Project list to be
prioritised
Drivers
Prioritisation
Interim Price
Control Submission
Q2 2014
Project Decision
Trees
• First stage filter
Project WSIP
Readiness
+ WSIP in-flight
 Potential cashflow
Further Cost Benefit
Analysis and
Prioritisation of
Projects
Finalise 2014 – 16
Investment Plan
against Drivers and
Funding constraints
Ongoing engagement with the EPA to maximise environmental benefit within funding constraint
11
Water: Compliance Challenge
450
400
385
Active Non-Compliance (Approx. Number)
350
300
250
200
140
150
100
50
31
22
BWN
Direction
0
Notification
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EPA Remedial Action List
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EPA Notifications
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EPA Directions
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EPA Audit reports
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RAL
Water: Availability Challenge
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41% UFW (LGMA 2012)
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25% of WSZs are currently operating beyond their design limits
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Lack of basic infrastructure and resources to manage leakage:
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DMA setup not complete
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Inconsistent and inadequate resourcing of active leakage control
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Visibility of DMA performance
Customer Side Leakage
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Metering programme providing new data source (>140K meters installed)
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5-6% of properties experiencing significant leaks
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First fix policy under consideration
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Dual benefit in terms of lead non-compliance
Rehabilitation contracts on-going
Waste Water: Compliance Challenge
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Licenced Discharges
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76% of larger urban areas complied with secondary standards in 2012
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Lower compliance rates for N and P
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EPA Prosecutions (Clifden, Killybegs, Bundoran)
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ECJ Prosecution under UWWT Directive
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70 UWWT WWTPs
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39 Collection Networks
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Major Data Challenge
Water Framework Directive requiring Good Status by 2015 (with potential to extend to 2021/2027)
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Requires potential investment of €3 - 4 billion
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New EPA licences being issued based on current 2015 WFD commitments
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Higher standards required under Habitats Directive
•
14
E.g. Blackwater Valley
Capital Investment Required
• Need to ramp up investment from current approx. €300m to address
compliance, capacity and capital maintenance deficits.
Capital Investment
• Need to develop pipeline for 2016+.
2014
2015
Available Capital
15
Capital Requirement
2016
Urban Waste Water Compliance Strategy
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Minor Capital Quick Wins
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ECJ Response
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16
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Engagement with DECLG and EU towards Partnership Implementation Agreement
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Deliver Major Capital Projects
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Collect appropriate data
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Roadmap for Compliance
WFD Engagement
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Engagement with EPA/ DECLG/ NPWS
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Development of Catchment Modelling Capability
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Collaboration on River Basin Planning and Licencing approach
Minor Capital Programme Example – Quick Wins
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Plants that failed UWWD Standards in
2011-2012 which are not overloaded
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47 No. WWTP
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Systematic bottom up data collection and
analysis
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Installation of appropriate monitoring
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Steps
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Operational assessment and resolve if
possible
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Optimise and deliver minor capital solution
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Confirm benefits delivered
Estimated cost €3 million to bring 40
WWTP into compliance
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Summary
• Significant Investment deficit to be addressed…
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Compliance
Capacity
Asset Risk/ Asset Maintenance
Business Efficiencies
• …Through best practice Asset Management:
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Spending less to achieve more
Stewardship of assets to keep in desired state
Managing risks not resources
Whole systems not their parts
Whole life perspective
Integrated view of operations & investment
Stakeholders fully engaged