Gas Distribution Asset Management Plan 2013 – 2023
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Gas Distribution Asset Management Plan 2013 – 2023 Table of Contents (Note that each section is individually numbered) SECTION 1 Executive Summary SECTION 2 2 BACKGROUND AND OBJECTIVES……………………………………………………4 2.1 Context for Asset Management at Vector…………………………………………………………..4 2.2 Planning Period and Approval Date…………………………………………………………………….7 2.3 Purpose of the Plan……………………………………………………………………………………………..8 2.4 Changing External Outlook……………………………………………………………………………….13 2.5 Asset Management in the Wider Vector Context – Internal Stakeholders……..13 2.6 Asset Management in the Wider Vector Context – External Stakeholders……...15 2.7 Asset Management Structure and Responsibilities…………………………………………. 20 2.8 AMP Approval Process……………………………………………………………………………………….25 2.9 Asset Management Decisions and Project Expenditure Approval……………………26 2.10 Progress Reporting…………………………………………………………………………………………… 28 2.11 Asset Management Processes…………………………………………………………………………..28 2.12 Works Coordination…………………………………………………………………………………………..30 2.13 Other Asset Management Documents and Policies………………………………………….31 2.14 Review of Vector’s Asset Management Practice……………………………………………….33 2.15 Cross Reference to the Information Disclosure Requirements………………………..37 SECTION 3 3 ASSETS COVERED BY THIS PLAN…………………..……………….……………..4 3.1 Distribution Area………………………………………………………………………………………….……..4 3.2 Major Customer Sites on the Vector Network………………………………………….………..6 3.3 Key Features ……………………………………………………………………………………………………….6 3.4 Load Characteristics ……………………………………………………………………………………………7 Vector Gas Distribution Table of Contents, Page 1 of 4 Asset Management Plan 2013-2023 3.5 Distribution System Design .…………………………………………………………………….……….9 3.6 Network Configuration………………………………………………………………………………….….10 3.7 Distribution Systems…………………………………………………………………………………………11 3.8 Justification of Assets……………………………………………………………………………………….14 3.9 Gas Distribution Maps……………………………………………………………………………………….16 SECTION 4 4 SERVICE LEVELS ..………………………………………………………………..……..5 4.1 Consumer Oriented Performance Targets………………………………………………………….5 4.2 Health, Safety and Environment……………………………………………………………………..11 4.3 Supply Reliability………………………………………………………………………………………………12 4.4 System Condition and Integrity……………………………………………………………………….19 4.5 Asset Utilisation………………………………………………………………………………………………..25 4.6 Network Security………………………………………………………………………………………………25 4.7 Works Performance Measures………………………………………………………………………….26 4.8 Process for Recording Reactive Fault Information………………………………………….28 SECTION 5 5 NETWORK DEVELOPMENT PLANNING…………………………………………….8 5.1 Network Development Processes……………………………………………………………………….8 5.2 Planning Criteria and Assumptions…………………………………………………………………….9 5.3 Planning Methodology……………………………………………………………………………………….12 5.4 Demand Forecasting …………………………………………………………………………………………14 5.5 Network Monitoring…………………………………………………………………………………………..21 5.6 Network Modelling…………………………………………………………………………………………….21 5.7 Network Development Efficiencies…………………………………………………………………..21 5.8 Network Development Programme – Northern Region…………………..……………..23 5.9 Network Development Programme – Auckland Region…………………………..……..32 5.10 Network Development Programme – Auckland Region (previously owned by NGC)……………………………………………………….………………….….69 5.11 Network Development Programme – Waikato Region……………………………..….….77 5.12 Network Development Programme – Central Plateau Region….…………………..107 5.13 Network Development Programme – Bay of Plenty Region……………..……….….123 5.14 Network Development Programme – Gisborne Region………………………………….140 5.15 Network Development Programme – Kapiti Region……………………………………….145 Vector Gas Distribution Table of Contents, Page 2 of 4 Asset Management Plan 2013-2023 5.16 Network Development Programme………………………………………………………………..152 5.17 Asset Relocation………………………………………………………………………………………………162 5.18 Customer Connections……………………………………………………………………………….....166 5.19 Long-term Development Plans…………………………………………………………………..….169 5.20 Network Development Forecast Capex Expenditure………………………………….….175 5.21 Opportunities for Improvement……………………………………………………………………..177 SECTION 6 6 ASSET MAINTENANCE AND RENEWAL PLANNING ……..……………………5 6.1 Overview…………………………………………………………………………………………………..………..5 6.2 Maintenance Planning Processes, Policies and Criteria……………………..……………..7 6.3 Asset Integrity Activities………………………………………………………………………..………..15 6.4 Capital Expenditure Forecasts ………………………………………………………………………….66 SECTION 7 7 SYSTEMS, PROCESSES AND DATA………………………………………………….4 7.1 Asset Information Management Background….………………………………………………….4 7.2 Asset Information Systems ………………………………………….…………………………………..5 7.3 Asset Management Reporting……………………………………………………………………………11 7.4 Improvement Initiatives……………………………………………………………………………………12 7.5 Asset Data Quality Improvements………….………………………………………………………..16 7.6 Expenditure Forecast………………………………………………………………………………………..17 SECTION 8 8 RISK MANAGEMENT…………………………………………………………………….4 8.1 Risk Management Policies……………………………………………………..…………………………. 4 8.2 Risk Accountability and Authority……………………………………………………………..……….5 8.3 Risk Management Process and Analysis…………………………………………………………….7 8.4 Business Continuity Management…………………………………………………………………….11 8.5 Insurance ………………………………………………………………………………………………………….16 8.6 Health and Safety……………………………………………………………………………………………..16 8.7 Environmental Management …………………………………………………………………………….19 Vector Gas Distribution Table of Contents, Page 3 of 4 Asset Management Plan 2013-2023 SECTION 9 9 EXPENDITURE FORECAST AND RECONCILIATION……………………………3 9.1 Capital Expenditure …………………………………………………………………………………………….3 9.2 Maintenance and Operations Expenditure………………………………………………………….8 9.3 Assumptions for Preparing Expenditure Forecasts……………………………………………15 9.4 Prioritisation of Expenditure……………………………………………………………………………..16 9.5 Price Escalation Factors…………………………………………………………………………………….20 APPENDICES Vector Gas Distribution Table of Contents, Page 4 of 4 Asset Management Plan 2013-2023 Gas Distribution Asset Management Plan 2013 – 2023 Executive Summary – Section 1 1 Summary of the Asset Management Plan 1.1 Asset Management at Vector Asset management is critical for ensuring Vector’s gas distribution business provides safe and reliable services, which meet the needs and expectations of consumers, help to achieve the business’ commercial and strategic objectives and satisfies its regulatory obligations. Effective planning helps ensure Vector maintains and invests appropriately in its network. Vector’s ongoing goal is to achieve a high standard of asset management (with a focus on safety), given its critical nature to the business and consumers, while reflecting the regulatory and economic environment within which it finds itself. It is important to note that gas is not an essential product. There are alternative fuels available in the market. The approach to management of the gas distribution business is therefore different to that of the electricity distribution business. Vector aims to be: “New Zealand’s first choice for integrated infrastructure solutions that build a better, brighter future” This Asset Management Plan supports achieving Vector’s vision. 1.2 Purpose of the Plan The purpose of this Asset Management Plan (AMP) is to comply with the requirements set out in the Commerce Commission’s Gas Distribution Information Disclosure Determination 2012. It covers a ten year planning period starting from 1st July 2013. The AMP accurately represents asset management practices at Vector as well as the forecasted ten year capital and maintenance expenditure on the Vector gas distribution network. The objectives of the AMP are to: Demonstrate that safe management processes are in place; Inform stakeholders about how Vector intends to manage its gas distribution network based on the information available; Demonstrate alignment between gas network asset management and Vector’s vision and goals; Provide visibility of effective life cycle asset management at Vector; Provide visibility of the level of performance of the network; Provide guidance of asset management activities to its staff and field service providers; Vector Gas Distribution Section 1, Page 2 of 13 Asset Management Plan 2013-2023 Provide visibility of forecast gas distribution network investment programmes and forecast medium-term construction activities to external users of the AMP; Demonstrate innovation and efficiency improvements; Discuss the impact of regulatory settings on future investment decisions; Discuss Vector’s view on expected technology and consumer developments and the asset investment strategies to deal with a changing environment; and Meet Vector’s regulatory obligations under the aforementioned Determination. From an asset manager perspective the AMP: Supports continued efficient improvement in Vector’s performance; Is essential to Vector’s goal to continually improve its asset management practices; and Will help Vector achieve its overarching vision. 1.3 Business Operating Environment 1.3.1 Qualification This AMP represents Vector’s current and best view of the ongoing investment, maintenance and operational requirements of its gas network, in the current operating environment. However, as discussed below, the business faces significant ongoing uncertainty, especially in relation to the current investment landscape and the still- evolving regulatory environment. This has a direct impact on Vector’s ability to make investment decisions and attract investment capital. Vector follows an annual budget process and the implementation of the works programmes may