Guendel – Germany – Session 5 – Paper Risk Based Asset Management Decision Support and Comparison of Solution Alternatives

Frankfurt (Germany), 6-9 June 2011 Guendel – Germany – Session 5 – Paper Motivation for the development of RBAM 2. RBAM-Methodology 3. Example 4. Summary and forecast Agenda

Frankfurt (Germany), 6-9 June 2011 Guendel – Germany – Session 5 – Paper  Necessity of an easy and tough as well as systematic an holistic methodology for deciding in uncertain situations  Methodology need to adapt to different situations  Ambition: Transparent decision progress. best usage of resources (money or people) Achievement of most efficient projects Motivation for development RBAM

Frankfurt (Germany), 6-9 June 2011 Guendel – Germany – Session 5 – Paper  Our RBAM-Methodology works in 4 several phases: I. Risk analysis and development of solutions II. Evaluation and selection of measures (horizontal optimization) III. Matching of resources and prioritization (vertical optimization) IV. Monitoring of the non performed measures RBAM-Methodology Phase I Risk analysis Development of solutions Phase II Evaluation Selection of measures Phase IV Monitoring Phase III Matching of resources prioritization

Frankfurt (Germany), 6-9 June 2011 Guendel – Germany – Session 5 – Paper  Risk Analysis and development of solutions Defining starting position for all fields of action Defining consequences on business objectives Creation of solutions Showing just the really important / relevant facts Consolidate available information RBAM Methodology - Phase I

Frankfurt (Germany), 6-9 June 2011 Guendel – Germany – Session 5 – Paper  Evaluation and Selection of measures Calculation for every solution alternative Summation of Costs and Benefits per year, discounting to base year and calculation of efficiency standard conversion factor makes comparison of different business objectives possible Plastic idea RBAM Methodology - Phase II

Frankfurt (Germany), 6-9 June 2011 Guendel – Germany – Session 5 – Paper  Matching of Resources and Prioritization Different measures are ranked with the efficiency factor Only measures with efficiency- factor > 1 are done (means: higher benefits then costs) Realization of measures until resource budget is reached Shows necessity of budget Makes sure, that only most efficient projects are realized RBAM Methodology - Phase III

Frankfurt (Germany), 6-9 June 2011 Guendel – Germany – Session 5 – Paper  Monitoring Non implemented measures are monitored (Risk register) Value of Risk Register reflects the statistical risk RBAM Methodology - Phase IV

Frankfurt (Germany), 6-9 June 2011 Guendel – Germany – Session 5 – Paper Example  Replacement of an old internal gas pressured cable  Comparison of 3 solution alternatives (chart 5)  RBAM analysis has shown: Complete replacement as the best technical solution Complete replacement as the most efficient solution Complete replacement improves Network configuration Existing cable Complete replacement Replacement by sections

Frankfurt (Germany), 6-9 June 2011 Guendel – Germany – Session 5 – Paper RBAM…  is a methodology for a holistic view of economy  supports the identification of smarter solutions  provides transparency regarding the impact of measures in relation to our business objectives  improves the communication with the commercial departments due to a translation of the technical challenges into the monetary world Summary and forecast

Frankfurt (Germany), 6-9 June 2011 Guendel – Germany – Session 5 – Paper Thank you for your attention! Thorsten Schmude Head of Network-Strategy Vattenfall Europe Distribution Hamburg GmbH Vattenfall Europe Distribution Berlin GmbH Bramfelder Chaussee Hamburg P – Thomas Gündel System-Strategy Vattenfall Europe Distribution Hamburg GmbH Bramfelder Chaussee Hamburg P – F –