Eugene Water & Electric Board 2014 Annual Conference Making Risk-based Decisions for Hydro Infrastructure February 19, 2014 Roger M. Kline – Generation Manager Eugene Water & Electric Board Eugene, Oregon

Setting the Stage Financial climate – Challenging wholesale market – O&M budgets shrinking (rate driven) – Competing demands for capital resources Organizational Values – Status quo no longer ok – Divesture of hydro now a reality Strategy – Identify/understand/talk “risk” – Use risk data to make decisions

Strategy Risk Identification – Capital investment decisions lacked criteria – O&M program not aligned with org objectives – Key performance indicators (KPI’s) lacking – No standardized tools Risk Mitigation – Formal condition assessment – Re-plan and align – Benchmarking – Asset management tools

Condition Assessment Ascertain asset “health” for – Capital investment Condition indicators – Operational Performance – Maintenance History – Physical Inspection – Age Criticality Weighting – Outage duration – Ease of repair – Availability of spares

Condition Assessment Ascertain asset “health” for – O&M priorities Identification of single point failures or gaps in protection under assessment methodologies Valuation of processes

Alignment With Organization Triple Bottom Line – Social – Environmental – Economic Day to day decisions – Risk based – Culture of compliance – Utilize lessons learned

Benchmarking

Asset Management Tools Work Asset Management (WAM) Generator Availability Data System (GADS) Partnerships & Associations NWHA CEATI NW Hydro Ops EUCG (HPC)

Summary & Next Steps “To be an outstanding provider of energy and water products that meet customer needs and benefit the citizens of Eugene.” Enterprise Risk Management New initiative / soft start ISO 55000?

Questions? Roger M. Kline Generation Manger Eugene Water & Electric Board (541) direct (541) mobile LinkedIn – Roger Kline