Annex 3: Asset Management Plan (AMP) Disclosure Requirements (from Electricity Information Disclosure Handbook)

Introduction

• Line owners (other than Transpower) must disclose a current AMP in the manner set out in Regulation 25, and listed in paragraph 4.4 of this Handbook.
• AMPs must be disclosed during the 1999-2000 financial year (i.e. before 31 March 2000), and within 3 months of the beginning of each financial year.

Comments: AMPs are dynamic documents that are normally updated annually. AMPs will support annual performance measure disclosures and performance assessment.

• Disclosed AMPs must include a summary.

Comments: The inclusion of a summary will aid understanding and readability. Minimum requirements for summaries are indicated in Schedule 2 of the Regulations, and shown below.

• Disclosed AMPs must consist of a single document.

Comments: Disclosure of plans as a single document will prevent disclosure of disjointed, poorly co-ordinated material that is difficult to understand. In some cases this will require companies to amalgamate various documents for disclosure purposes, for example, separate network development plans. This does not necessarily require integration of separate plans into a new framework if the linkages between parts of the plan are made apparent and indexed.

• The disclosed AMP should:
• permit assessment of the suitability of asset management practice and assets for current and future service;
• specifically support the achievement of disclosed reliability performance targets; and
• provide a sound basis for on-going risk assessment.

Comments: This is the over-riding intention of AMP disclosure. AMPs should be compiled with these primary criteria firmly in mind.

• Disclosed AMPs must clearly identify limitations in availability or completeness of information, and include details of:
• the assumptions made and basis for asset management planning in the absence of such information, including estimation and assessment methodologies used; and
• plans for improvement in information quality.

Comments: The detail and accuracy of information available will vary. Information gaps should be specifically addressed to enhance the transparency of disclosure, place emphasis on identifying deficiencies and promote improvement.

Summary

The AMP is to include a summary that provides a brief overview of:

• The purpose of the plan;
• The date the plan was completed and the period to which the plan relates;
• Asset management systems and information;
• Network and asset description;
• Service level objectives;
• Life-cycle asset management and development plans;
• Risk assessment; and
• Performance and plans for improvement.

Background and Objectives

This section of the disclosed AMP must include the following:

• A description of the interaction between the AMPs background and objectives and other corporate goals, business planning processes and other plans;
• Planning periods adopted;
• Stakeholder interests (owners, consumers, etc);
• Accountabilities and responsibilities for asset management; and
• Details of asset management systems and processes including asset management information systems/software and information flows.

Comments: The outline of the AMP's structure, and its links to and relationships with business, financial, human resource, business continuance, information systems and other plans will reconcile corporate objectives with asset management objectives, put the detailed provisions in context and reveal the overall approach.

Skills and resources must be available to support the asset management strategy, and the organisation and identification of personnel accountability support this requirement.

The AMP should explain how information systems support asset management processes.

Assets Covered

• Details of assets covered by the disclosed AMP must include:
• Description of the asset configuration;
• Identification of assets by category;
• Justification for asset; and
• Location, age and condition.

Comments: What is owned and why, where it is and what condition it is in.

Service Levels

• The disclosed AMP must detail proposed levels of service, including:
• Consumer oriented reliability, security and availability performance targets;
• Other targets relating to asset performance, asset efficiency, and effectiveness and efficiency of line business activity; and
• Justification for target levels of service based on consumer, legislative, regulatory, shareholder and other requirements.

Comments: The asset management process is based on the identification of the business need for the use of the assets. For the purposes of information disclosure it is appropriate to concentrate on consumer-related performance measures, although the AMP should also state other commonly used efficiency measures for assessing asset management performance.

Most line businesses have documented service levels, so their inclusion in the disclosed AMP should not be onerous. The service levels will require careful consideration and definition by each line owner.

Line owners may wish to incorporate the reliability measures required to be disclosed under Regulation 22 in preparing this material (the adoption of this approach would not eliminate the need to comply with Regulation 22).

Network Development Planning and Lifecycle Asset Management Planning

• Disclosed AMP must detail network development and lifecycle asset management plans, including:
• A description of planning criteria and assumptions;
• Details of demand forecasts, network configuration analysis, and reliability assessments;
• Policies with respect to non-asset solutions, redeployment and upgrade of existing assets, acquisition of new assets, adoption of new technology and disposal of existing assets;
• Analysis of the options available and details of the decisions made to satisfy and meet target levels of service;
• Description and identification of maintenance policies, programme and actions to be taken for each asset group, including associated expenditure projections; and
• Description (and identification) of the network development programme and actions to be taken, including associated expenditure projections.

Comments: These requirements will probably form the largest part of the AMP. The requirements are intended to be sufficiently non-prescriptive to avoid compliance costs associated with undue adaptation of existing plans.

Adoption of asset management practice that recognises all elements of the asset life-cycle, including design and planning, procurement, operation and maintenance and disposal costs assists in long term efficiency improvement.

Maintenance policies and strategies designed to specifically address the needs of individual asset groups can be disclosed. Disclosure will reveal whether appropriate steps are being taken to ensure that predictive, failure finding or scheduled maintenance tasks have been identified and are being undertaken.

Risk Management

• Disclosed AMPs must include details of risk policies, assessment and mitigation, including:
• Methods, details and conclusions of risk analysis; and
• Details of emergency response and contingency plans.

Evaluation of Performance

• Disclosed AMPs must cover details of performance measurement, evaluation and improvement, including:
• Reviews of progress against plan (both physical and financial);
• Evaluation and comparison of actual performance against targeted performance objectives; and
• Gap analysis and identification of improvement initiatives.