End-to-end asset health: How AEP and others are stepping into the future


By: SGN Staff


By Jesse Berst


Did you know that most utilities already have enough data to implement an end-to-end asset health solution? Or that the number one hurdle to successful asset health deployments is typically a personnel issue?


These are just a few of the things I learned when I chased down several asset health authorities to find out where things stand. The good news: utilities are now starting to implement the end-to-end systems that have always been the Holy Grail. More good news: I signed up three of those experts to coach us for an hour on September 11th in a no-cost webinar on end-to-end asset health:

·         Carey Schneider, Engineer, Asset Health Center
American Electric Power Company (AEP)

·         Gary Rackliffe, VP Smart Grids North America
ABB, Inc

·         Chris Lemay, Product Manager

Why asset management is becoming so critical

It's no secret why asset management is becoming so crucial. Most utilities are faced with aging transformers, breakers and other critical infrastructure. On top of that, many of their top people are retiring, taking their equipment expertise with them. And in some areas - the Sandy-ravaged Northeast and Tornado Alley in the U.S., for instance - grid hardening is a major theme with regulators and ratepayers alike.


As a result, asset health management is elevating from the departmental level to the C suite. It is becoming a strategic imperative.


What end-to-end asset management is... and isn't

Many people still think that asset management is about monitoring today's conditions for selected pieces of high-value equipment. In fact, modern asset management is really about managing tomorrow's conditions for an entire fleet of assets.


By end-to-end, I mean an asset health system that informs every decision - from what to work on today; to whether to repair or replace; to how to scientifically justify your capital plans to regulators. I'm also referring to a system that can pull in data from any and all corners of the company - SCADA historians, sensor data, metering data, test reports, inspections, performance models from equipment vendors, everything.


To the extent that utilities have tried to create a comprehensive asset health solution in the past, they typically cobbled it together with a collection of point solutions from individual departments and people.


The future of asset health, however, is full lifecycle management via a centralized system. Such a system can calculate the total risk of failure. Not just the risk that the equipment will break down. But also how much damage that failure would cause.

A process to manage the people side

If people are often the hurdle, then how do you get around it? Rackliffe says the following five steps have proven effective:

1.     Conduct a workshop with stakeholders to cover all aspects - the data, the analytics, the process.

2.     Conduct a limited pilot. Restrict the geography or the asset type or both to create a starter project that's easy to understand and easy to prove the benefits.

3.     Optimize the system and the business processes. Here you want to ensure that you are achieving savings without impacting system performance. Rackliffe and Lemay both stress that you have to optimize the business processes, not just the software.

4.     Enhance the data. Look for data that is incomplete or inaccurate.

5.     Deploy widely using the lessons (and positive momentum) garnered from the pilot.


When things go right

Done well, today's end-to-end asset health solutions can deliver impressive benefits. At AEP, for instance, one of the key drivers was avoiding unplanned catastrophic outages.


That's a big one, to be sure, but other benefits accrue as well, including:

·         Reducing O&M costs

·         Optimizing resources - squeezing full value from existing assets

·         Transparent investment decisions. Now you can give financial executives and regulators clear calculations that prove what needs to be replaced and when

·         Embedding expertise from retiring workers into the system

·         Creating a performance-based culture


The hidden surprise in your data

There are other benefits as well. And there's often a "hidden bonus" according to Chris Lemay. As they start working with their new asset health system, they typically discover that they already have lots of data laying around - data that can be turned into great value once pulled into a central system.


"A lot of utilities are spending money on inspections and on installing sensors," adds Gary Rackliffe. "But they are not getting the value they could and should from those expenditures. It's surprising what you discover when you pull everything together. It really unlocks the value of the data."


There are plenty of other asset health tips and techniques people like Carey, Gary and Chris can pass along. We'll be emphasizing those lessons learned on September 11th during our webinar on end-to-end asset health. (Free to Smart Grid News readers.) Even if you'd got a conflict on the 11th, click the link to register, since you'll get a copy of the slides and a link to the video replays. But stop by in person if your schedule permits, since we'll be pausing frequently to take your questions and answering the extras by email.


Jesse Berst is the founder and Chief Analyst of SGN and Chairman of the Smart Cities Council, an industry coalition.

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