07-11-2016 BPU RPT 05 - Laserfiche WebLink

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P U B L I C U T I L I T I E S BOARD OF PUBLIC UTILITIES RIVERSIDE PUBLIC UTILITIES Board Memorandum DATE: JULY 11, 2016 ITEM NO: 5 SUBJECT: ELECTRIC ASSET MANAGEMENT SYSTEM PROJECT, AMENDMENT TO PROFESSIONAL SERVICES AGREEMENT WITH WESTIN ENGINEERING, INC. OF RANCHO CORDOVA, CA WITH NO CHANGE IN TERM OR COMPENSATION; APPROVAL OF WORK ORDER NO. 1623473 FOR $493,000 FOR ACCOUNTING PURPOSES ONLY. ISSUES: The items for Board of Public Utilities consideration are to: 1) approve the Third Amendment to the Professional Services Agreement with Westin Engineering, Inc. to modify the scope of services to conduct a business process assessment, gap analysis and related work for development of an electric asset management system without changes in compensation or term; and 2) approve Work Order No. 1623473 for accounting purposes of the electric utility expenditure. RECOMMENDATIONS: That the Board of Public Utilities: Approve the Third Amendment to the Professional Services Agreement with Westin Engineering, Inc. to reflect a change in scope to conduct business process assessment, gap analysis and related work for development of an electric asset management system and no increase in compensation or term; and 2. Approve Work Order No. 1623473 in the amount of $493,000 to fund the electric utility expenditure. BACKGROUND: An Asset Management System (AMS) focuses on the complete lifecycle of utility assets. It helps planning and operations staff understand the specific needs of each asset, while maintaining a system -wide view of priorities. An AMS tracks location, condition, criticality, costs, maintenance and inspection requirements, and the life- expectancy of each operating asset. The goal of asset management is to balance reliability, cost and risk. An effective AMS can significantly improve system reliability and manage operating costs. Utility personnel use an AMS to track the condition of assets and predict future operating costs. An AMS also helps the utility plan and prioritize asset inspections, maintenance, repairs and replacement, and ensures that critical assets receive the appropriate levels of maintenance in a timely manner. Additionally, the utility can better plan and prioritize workforce activities and needs, and increase the efficiency of the workforce. Customers benefit from an effective AMS through improved service quality, increased efficiencies and reliability, and improved management of maintenance and operating costs. These key benefits of an AMS are highlighted in the figure below.