ASSET MANAGEMENT PROCEDURES Management Plan For Irrigation .

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ODAASSET MANAGEMENT PROCEDURESFOR IRRIGATION SCHEMES- Preliminary guidelines for the preparation of an assetmanagement plan for irrigation infrastructureInstitute of Irrigation Studies, University of Southampton, UKin association withWRc Engineering, Swindon, UKMott MacDonald, Cambridge, UKDirectorate General of Water Resources Development, Government of IndonesiaFaculty of Agricultural Technology, Gadjah Mada University, Yogyakarta, Indonesia.January 1995

ODA

ASSET MANAGEMENT PROCEDURESFOR IRRIGATION SCHEMES- Preliminary guidelines for the preparation of an assetmanagement plan for irrigation infrastructureMain subject area:Water and SanitationTheme:Improved availability of water for sustainable food productionProject Title: Asset management procedures for irrigation schemesProject reference:R6078This document is an output from an ODA-funded research project, carried out for the benefitof developing countries. The views experessed in this report are not necessarily those of theOverseas Development Administration.Institute of Irrigation Studies, University of Southampton, UKin association withWRc Engineering, Swindon, UKMott MacDonald, Cambridge, UKDirectorate General of of Water Resources Development, Government of IndonesiaFaculty of Agricultural Technology, Gadjah Mada University, Yogyakarta, Indonesia.January 1995

SummaryThe report is the result of a six-month project to study Asset Management Planning, a techniquederived from the UK water industry, and to examine its potential application to irrigation indeveloping countries. Central to the work was a four month field trial in Yogyakarta, Indonesia, inwhich practical procedures were formulated and tested.Experience of this trial enabled thefeasibility of applying the methodology to irrigation to be established and aspects requiring furtherresearch to be identified.The approach to the project, the reasoning behind it and its execution are described. There is areview of the origins of Asset Management and a brief examination of the setting within irrigationwhich concerns the study. More similarities than differences were found between asset managementfor irrigation and that for the UK water industry.These are summarised together with theimplications for transferring the techniques between these two fields of application. Current issuesand initiatives in Indonesia are described as a background to the field trial there.The application of Asset Management to irrigation is described. Procedures are set out and discussedfor the production and use of an Asset Management Plan (AMP). Each of the steps is described, withbackground information, recommendations and examples or illustrations, wherever possible, fromthe experiences of the trial in Yogyakarta. Aspects for which the requirements are location-specificor which will demand particular attention for other reasons, are identified and discussed.The report concludes that Asset Management Procedures for Irrigation Schemes are feasible and thatthe methodology provides a framework for strategic management in the sector. Through the detailedinformation provided and the references to the trial, practicability is demonstrated and the extent towhich the ideas are developed is shown. Resource requirements and the logistics of undertaking theprocedures are set out in broad terms. It is recommended that an overall programme for AMPproduction of nine to eighteen months may realistically be envisaged.The extension of themethodology into other areas is considered briefly and further research needs are identified.Supporting information is given in the Appendices.

AcknowledgementsThe financial assistance of the Overseas Development Administration (ODA), which enabled thisstudy to be carried out, is gratefully acknowledged.Thanks are extended to all those who gave of their time and expertise during the study, particularlythe staff and students of the Faculty of Agricultural Technology, Gadjah Mada University, and thestaff of the Directorate General of Water Resources Development, both in Yogyakarta and in Jakarta.The authors are especially grateful to Dr. Suprodjo, Dr. Sigit, Dr. Saiful and Ir. Budi for the warmthof their hospitality in Yogyakarta as well as for their help and advice, and to team in Yogyakarta,Fauzan Umar and ‘Tining’ Murtiningrum for their excellent assistance.The logistical support provided in Indonesia by Mott MacDonald International is appreciated and ourthanks go to Mr. Masood Khan, Mr. Chris Brown, Mr. Purnomo Tarmidi and to Mrs. Menny Triono.Also too for the practical advice that Phil Richardson, Tim Hannan and ‘Mahe’ Mahendrarajah gaveme on technical aspects of the project.Doug Vermillion of the International Irrigation Management Institute (IIMI), Bill Davidson ofAnglian Water and Keith Howells of Mott MacDonald all very kindly gave the benefit of their time,as did Prof. Martin Snaith and Dr. Henry Kerali of the University of Birmingham, HighwaysDevelopment and Management Project. We are grateful to Ian Makin, John Skutch, Phil McAteer,Gez Cornish and Tim Forster of HR Wallingford for some valuable discussions in UK and inYogyakarta. Many others, who cannot all be named, contributed, and we are grateful for their help.The contribution made by the four specialists, Jim Perry of Mott MacDonald, Bill Kingdom andEdward Glennie of WRc, and Ian Smout of Loughborough University of Technology is gratefullyacknowledged.

Asset Management Procedures for Irrigation SchemesCONTENTSSummaryAcknowledgementsGlossary of TermsPart I: naging Infrastructure - the Contemporary ChallengeStructure of the ReportBackground to the ProjectCollaborating OrganisationsProject ObjectivesUnderlying AimsWork ProgrammeField TrialAsset Management2.12.22.32.42.52.6DefinitionOrigins in the Water Industry of England and WalesEssential Features of the Asset Management Plan (AMP)Statistics in Asset Management PlanningApplication to Irrigation - Similarities and DifferencesAsset Management for Irrigation in the Indonesian Contextpage 1112223336667788Part II: Application - Asset Management Planning for Irrigation3Producing the Asset Management Plan3.13.23.33.43.53.63.73.84IntroductionSystems DefinitionStratified Random SamplingEnvironmental, Legal and Development ContextPerformance AssessmentManagement IssuesThe Asset SurveyThe Cost ModelUsing the Asset Management Plan4.14.24.34.44.5Presentation of the AMPConfidence GradesFinancial ModellingOrganisational 344Part III: Conclusions5Arrangements for Implementation5.15.25.35.46.46464848Further ogisticsInstitutional ContextFurther ResearchApplication to Other UtilitiesConclusionsReferences and BibliographyAPPENDICESA1A2A3A4Examples of Data Collection ProformaeExamples of Standard Output FormsData Transformation Requirements and Database ArchitectureExamples of Data Collected in the Field TrialA5Research Paper50515155

GLOSSARY OF TERMSAggregationThe extrapolation of results of sampling, taking due account of stratificationand normalisation criteria, to represent all systems together.Alternative StrategiesMutually exclusive means to achieving a single set of ultimate goals.Asset ConditionA measure of the state of deterioration of an asset from its new conditionagainst a defined reference scale. This is assessed independently of the abilityof the asset to perform its function (see Asset Serviceability).Asset ExtentThe number of assets which exist, counted under various categories describingassets of similar characteristics and in size bands.Asset ImportanceA measure of the potential influence of an individual asset on systemperformance due to its position within the system.Asset Management Plan (AMP) A comprehensive report on a piece of infrastructure, prepared in accordancewith a prescribed format, setting out the nature and extent of the assetsconcerned, their value and the liabilities associated with each. In order topresent this information in a meaningful way, the report will necessarily set outa plausible plan of investment related to the sustained achievement of asatisfactory service to users.Asset ServiceabilityThe ability of the asset to perform its function(s). Measured on a scale byreference to appropriate functional definitions.Asset Stock, Condition andServiceability ProfilesA report detailing the extent of assets, their size (by band) and MEA value, both‘gross’ and ‘net’ (depreciated - allowing for condition). Condition andServiceability Profiles are given by reporting the value of assets (by gross MEA)in each condition grade and in each serviceability grade respectively. Providesa clear summary of the current state of the asset stock. (See also ‘ModernEquivalent Asset Value’ - MEA).Asset SurveyThe inspection of assets in the field to determine (or confirm) their physicalattributes, condition and serviceability.Asset Types and ComponentsDepreciation CategoriesThe grouping of asset types and components thereof on the basis of similarrates of deterioration from new condition to a degraded state.Asset ValueThe value of an asset based on its replacement cost or MEA (see also ‘ModernEquivalent Asset Value’). Reported both as ‘gross’ and ‘net’ (depreciated)value.BandA continuous range of values from a lower to an upper limit.Budget Planning andInvestment PrioritiesThe allocating of ‘baskets of money’ to identified types of investment activityover a short term (5 year) planning horizon but in conformity with the longterm strategic business plan arrived at as a result of the financial modellingprocess.CAPEXCapital Expenditure.Capital Investment ActivitiesUnit Cost IndexA ‘look-up table’ of unit prices at current rates for rehabilitation, upgradingand extension works (e.g. ‘replace gates’, ‘re-line canals’, ‘repair wingwalls’etc.) related to each asset type and size band. Facilitates the rapid build up ofcost estimates for any identified investment need.Capital PlanningThe process of defining the capital investment requirements implied by thepreferred investment strategy and established from the financial model. Toachieve this it is necessary to know the cost stream, to examine the income streamand to consider the flow of capital.ComponentsEach asset comprises a number of component parts. Their identificationfacilitates condition assessment when different components may be subject todifferent degrees of deterioration.

ConditionSee ‘Asset Condition’Condition GradeAn indicator, on a defined scale from ‘Good’ to ‘Bad’, of the state ofdegradation of an asset from new. See also ‘Asset Serviceability’.Cost ModelA reference data-base for use in the preparation of the AMP and for thecomparison of alternative investment strategies in the subsequent financialmodelling process. Costs related to each asset type and size are needed to valueexisting assets (Modern Equivalent Asset); to provide unit costs for system capitalinvestment activities; and to quantify operational costs.Cost RecoveryThe matching of revenue levels to the actual cost of providing the service overthe long term.Daerah Irigasi (DI)An Indonesian term used to define an irrigation network. The area may rangefrom a few to several thousand hectares. A DI is often characterised as anirrigation network offtaking from a weir or a river.DemandThe demand placed on the service. The demand may change over time,resulting in changes to the infrastructure requiring additional investment.Engineering StudiesStudies required to relate system performance to the characteristics of theinfrastructure and thus to establish the extent of work needed to maintainand/or improve asset condition and system performance.Existing PerformanceQuantifies the existing performance of the system. The gap between theexisting performance and the target (Standards) identifies the performance gapthat is to be narrowed through further investment.ExtentSee ‘Asset Extent’.Financial ModelA process of reviewing and refining the provisional ideas presented in theAMP to ensure a realistic investment strategy in terms of funds availableincluding identifying any necessary CAPEX/OPEX trade-offs.FunctionSee ‘Asset Serviceability’.Importance BandSee ‘Asset Importance’Investment ActivitiesThe specific activities (e.g. items of construction work) for which the investmentis intended to pay and which are essential to achieve the investment objectives.Investment BenefitsThe intended benefits, in terms of improved levels of performance underacknowledged criteria, associated with specific investments.Irrigation ServiceThe people, organisation and infrastructure that together provide to users allthe services associated with irrigation (including drainage).Irrigation Service Fee (ISF)A charge to users of the irrigation service intended to reflect the real costs of itsprovision.Modern Equivalent AssetValue (MEA)The cost, at current prices, of a modern asset of equivalent function, notnecessarily replicating the existing asset in precise detail.Needs Based Budgeting(NBB)The attempt to allocate annual budget provisions on the basis of clearlyidentified investment needs rather than on some arbitrary or nominalapportioning measure.NormalisationThe process of reducing system characteristics, especially costs, to a commonunit measure such as cost per unit irrigated area, number of structures per unitirrigated area, etc. Normalised values of quantities or costs can then be used toderive numbers and/or costs for schemes of different sizes.O&MOperation and Maintenance.Operating CostsThe costs of operating (including routine maintenance - see definition) the

OPEXsystem over the budgeting horizon.Operating Expenditure.Performance AssessmentA series of stages in which the performance of a system, in terms of ‘outputmeasures’, is compared with targets and the reasons for differences identified.Performance TargetSee ‘Standard(s)’PoliciesDeclared intentions against which an organisation expects its achievements tobe measured.Primary CanalThe main supply canal at the top of an irrigation system from its intake to thedivision into a number of Secondary CanalsPrivatisationThe transfer of ownership and management of infrastructure assets and theservice they support from the public sector into private handsRevenueThe income received to pay for the service provided.Routine Maintenance CostsCosts associated with regular and frequent activities intended to keep assetsoperational and in a good state of repair.SchemeThe complete operation including the infrastructure and all those people andother influences involved in its operation and use. An irrigation schemeincludes the ‘system’, the farmers and operators, the land/soil, the crops, themarket etc. (see also ‘System’).Secondary CanalOne of a number of secondary canals which convey water from the mainPrimary Canal of an irrigation system to several ‘tertiary’ offtakesServiceabilitySee ‘Asset Serviceability’.Serviceability GradeAn indicator of the ability of an asset to perform its function(s) on a definedscale from ‘Fully Functional’ to ‘Ceased to Function’.SizeA measure associated with each asset type which gives an indication of its scaleand hence its monetary value.Standard(s)The intended level(s) of performance - i.e. the ‘Target(s)’StrataSee ‘Stratification’.StratificationThe statistical procedure of dividing a diverse collection of systems into groups(termed Strata) having common characteristics from which representativesamples can be taken.SystemThe infrastructure itself or engineering hardware, separated from otherinfluences (see also ‘Scheme’).Technical Level(of an irrigation system)A classification method used in Indonesia to define the degree of control andmeasurement of flow which is possible in a system due to its design andconstruction. Three levels are used: Technical - full control and measurementat all divisions/offtakes; Semi-technical - full control and measurement atselected points only in the system; Non-technical - no measurement of flowwithin the system and control, if any, using simple structures only.Tertiary CanalThe canal conveying water from a Secondary Canal offtake to QuartinaryCanals and thus to the field.Tertiary UnitA grouping of fields, generally totalling between 30 to 150 ha, which are servedby a single offtake from the Secondary (or, occasionally, the Primary) Canal.Management and control of water distribution within the Tertiary Unit isusually the responsibility of the water users.TurnoverThe transfer of responsibility for operation and maintenance (of an irrigationsystem) to a farmer group or Water Users Association.

Part I: ConceptsJim Welch/Asset Management - Irrigation/Sep-95

Jim Welch/Asset Management - Irrigation/Sep-95

1.Introduction1.1Managing Infrastructure - the Contemporary ChallengeIt is a characteristic of modern technological society that, as ‘development’ continues, so dependenceupon networks of artificial infrastructure increases.Transportation, telecommunications, energydistribution, water and sewerage systems (for instance) have become essential to the ability of oursocieties to function ‘normally’. These facilities and the depth of our reliance on them, have grown atan unprecedented rate in recent decades. Invariably they have been accumulated over a long period ona project-by-project basis, the cost of each project being justified by the particular need it satisfied.As the stock of infrastructure assets thus accumulates, a creeping maintenance liability accrues andthis eventually dominates the requirement for resources.Society expects the continuation orimprovement of the service to which it has grown accustomed and value for money is demanded. Theold ‘project’ approach which served so well for past development is found to be inadequate to theemerging task. New methodologies are needed to provide a clear overview of objectives, options,benefits and competing needs and to resolve these into a comprehensive strategy for investment Theinstitutions responsible for management of the infrastructure may themselves need reform. Thisphenomenon is quite dramatically illustrated by recent privatisations of public infrastructure in the UKand elsewhere.The challenge facing irrigation is at least as great as that in other sectors. The following quotation isillustrative (Rabindranath, 1993):“Irrigated agriculture is up against an enormous challenge. Global population continues togrow at a tremendous rate. Water is becoming increasingly scarce. The most attractiveirrigation sites have already been exploited. Yet, irrigated agriculture will have to deliveraverage output increases of at least 3.5% per year if future food demands are to be met.”The era of the Green Revolution saw the large scale development of irrigation schemes. That era ofnew construction is past. The challenge now is to maintain existing infrastructure and to improve it interms of water-use efficiency and of cost-effectiveness. This challenge sets the context of the report.1.2Structure of the ReportThe report is centred on a project set up to study Asset Management Planning, a technique derived from theUK water industry, and to examine its potential application to irrigation. In Part I the concepts are setout. The approach to the project, the reasoning behind it and its execution are described. There is areview of Asset Management and of the setting within irrigation which concerns the study. Currentissues and initiatives in Indonesia are described as a background to the field trial there. Part IIdescribes the application of Asset Management to irrigation. Procedures are set out and discussed forthe production and use of an Asset Management Plan (AMP). These were devised in the course of thestudy based on its findings and, importantly, on the experiences of the field trial.The reportconcludes, in Part III, with reflections on the benefits of the AMP, how these can be m

implications for transferring the techniques between these two fields of application. Current issues and initiatives in Indonesia are described as a background to the field trial there. The application of Asset Management to irrigation is described. Procedures are set out and discussed for the production and use of an Asset Management Plan (AMP .

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