Quantifying Risk to Optimize Facility Integrity Management

2020 ◽  
Author(s):  
Alex Nemeth ◽  
Lily Li ◽  
Andrew Nielsen ◽  
Geoff Vignal
Keyword(s):  
Decision Making ◽  
Cost Benefit Analysis ◽  
Risk Mitigation ◽  
Cost Benefit ◽  
Storage Condition ◽  
Pipe System ◽  
Relative Ranking ◽  
Integrity Management ◽  
Dollar Amount ◽  
The Right

Abstract Effective asset integrity management is supported through the understanding of the condition of the asset, and the quantification of the safety and uncertainty of its properties. Risk based and risk informed decision making can help operators prioritize inspections and repairs on mainline pipe, as well as within operator facilities. Setting operator system specific targets for reliability and risk can help operators better understand the condition of their system, and provide one means of determining whether integrity action or other risk treatment is required on a specific asset, either on the mainline pipe system or on a facility asset system. While mainline pipe condition is better understood through the use of inline inspection technology and non-destructive examination in the field, facility piping and storage condition is more difficult to understand due to the complexity and number of segments of assets within an operator’s facility, as well as the unpiggable nature of the majority of facility piping. To help resolve this issue, a risk quantification can be done for each segmented asset within a facility. A relative ranking of asset risks can help prioritize facility integrity activities and drive the planning and execution optimization. However, simply looking at a relative ranking of asset risks may not be enough to maximize risk reduction and achieve safety and reliability targets. This paper looks to expand on the implementation of Risk Based Inspection (RBI) standard in API 581 and explore more broadly how facility asset risk results can be used in integrity planning and decision making. The paper also examines the application of using finance principals to better quantify risk and carry out a meaningful cost benefit analysis to optimize integrity programs. Interpreting a quantified risk dollar amount is an industry challenge, and shedding light onto the value of applying reliability and risk models beyond the safety of an operator’s system can be extremely beneficial for operators to enhance cost efficiency. The quantification of risk helps support the optimization of spend and resource allocation to bring efficiencies into integrity management systems while maintaining focus on the right risk mitigation across an operator’s system.

scholarly journals A Methodological Framework for Sustainable Office Building Renovation Using Green Building Rating Systems and Cost-Benefit Analysis

2020 ◽  
Vol 12 (15) ◽  
pp. 6156
Author(s):  
Nataša Šuman ◽  
Mojca Marinič ◽  
Milan Kuhta
Keyword(s):  
Decision Making ◽  
Sustainable Development ◽  
Cost Benefit Analysis ◽  
Early Stage ◽  
Cost Benefit ◽  
Green Building ◽  
Office Buildings ◽  
Office Building ◽  
Rating System ◽  
Benefit Analysis

Sustainable development is a priority for the future of our society. Sustainable development is of particular importance to the Architecture, Engineering, and Construction (AEC) industry, both for new buildings and for the renovation of existing buildings. Great potential for sustainable development lies in the renovation of existing office buildings. This paper introduces a new framework for identifying the best set of renovation strategies for existing office buildings. The framework applies selected green building rating system criteria and cost-effective sustainable renovation solutions based on cost-benefit analysis (CBA), and thus provides a novelty in decision-making support for the sustainable renovation of office buildings at an early-stage. The framework covers all necessary steps and activities including data collection, determination of the required level of renovation, selection of the green building rating system, identification of impact categories and criteria, and final evaluation and decision-making using CBA. The framework can be used in conjunction with different systems and according to different regional characteristics. The applicability of the addressing procedure is shown through a case study of a comprehensive renovation of an office building in the city of Maribor.

scholarly journals A Framework for Risk-Based Cost–Benefit Analysis for Decision Support on Hydrogeological Risks in Underground Construction

Geosciences ◽  
2021 ◽  
Vol 11 (2) ◽  
pp. 82
Author(s):  
Johanna Merisalu ◽  
Jonas Sundell ◽  
Lars Rosén
Keyword(s):  
Decision Support ◽  
Cost Benefit Analysis ◽  
Risk Mitigation ◽  
Ground Surface ◽  
Cost Benefit ◽  
Expert Elicitation ◽  
Benefit Analysis ◽  
Underground Construction ◽  
Groundwater Leakage ◽  
Risk Reducing

Construction below the ground surface and underneath the groundwater table is often associated with groundwater leakage and drawdowns in the surroundings which subsequently can result in a wide variety of risks. To avoid groundwater drawdown-associated damages, risk-reducing measures must often be implemented. Due to the hydrogeological system’s inherent variability and our incomplete knowledge of its conditions, the effects of risk-reducing measures cannot be fully known in advance and decisions must inevitably be made under uncertainty. When implementing risk-reducing measures there is always a trade-off between the measures’ benefits (reduced risk) and investment costs which needs to be balanced. In this paper, we present a framework for decision support on measures to mitigate hydrogeological risks in underground construction. The framework is developed in accordance with the guidelines from the International Standardization Organization (ISO) and comprises a full risk-management framework with focus on risk analysis and risk evaluation. Cost–benefit analysis (CBA) facilitates monetization of consequences and economic evaluation of risk mitigation. The framework includes probabilistic risk estimation of the entire cause–effect chain from groundwater leakage to the consequences of damage where expert elicitation is combined with data-driven and process-based methods, allowing for continuous updating when new knowledge is obtained.

STAKEHOLDERS, SPATIAL LOCATIONS AND TIME HORIZONS IN AN EXTENDED SOCIAL COST-BENEFIT ANALYSIS: A CASE OF PIPALPANKHA WATER RESOURCE PROJECT

2009 ◽  
Vol 11 (02) ◽  
pp. 245-265 ◽  
Author(s):  
P. RAM BABU ◽  
NALLATHIGA RAMAKRISHNA
Keyword(s):  
Decision Making ◽  
Water Resource ◽  
Social Cost ◽  
Cost Benefit Analysis ◽  
Cost Benefit ◽  
Development Project ◽  
Development Projects ◽  
Benefit Analysis ◽  
Time Horizons ◽  
Spatial Locations

Cost-Benefit Analysis (CBA) has been serving as an important tool for decision making with regard to the development projects involving large investments. The Social Cost-Benefit Analysis (SCBA) is an extension of the CBA to certain social impacts, which hitherto were not measured. As the impacts of development projects on ecology and environment assumed importance, measuring the corresponding costs and benefits also began to assume significance. With the advancement in economic valuation techniques over time, measurement could be done and the framework of SCBA has been extended to incorporate the same. Moreover, unlike the CBAs, which do not account for the distributional aspects, the SCBA can potentially account for these. This paper presents a case study of extending the SCBA framework to include social and environmental impacts of a large water resource development project in India. It emphasises the distribution of project benefits and costs over stakeholders, spatial locations and time horizons so as to demonstrate the utility of extended SCBA in project decision making. It is observed that both the numeraire measure i.e. cost-benefit ratio, as well as the distributional analysis present a favourable case for the project.

scholarly journals The ALARP Principle in the Cost-Benefit Analysis for the Acceptability of Investment Risk

2018 ◽  
Vol 10 (12) ◽  
pp. 4668 ◽  
Author(s):  
Antonio Nesticò ◽  
Shuquan He ◽  
Gianluigi De Mare ◽  
Renato Benintendi ◽  
Gabriella Maselli
Keyword(s):  
Cost Benefit Analysis ◽  
Risk Mitigation ◽  
Cost Benefit ◽  
Economic Evaluations ◽  
Investment Risk ◽  
Benefit Analysis ◽  
Mitigation Design ◽  
The Cost

The process of allocating financial resources is extremely complex—both because the selection of investments depends on multiple, and interrelated, variables, and constraints that limit the eligibility domain of the solutions, and because the feasibility of projects is influenced by risk factors. In this sense, it is essential to develop economic evaluations on a probabilistic basis. Nevertheless, for the civil engineering sector, the literature emphasizes the centrality of risk management, in order to establish interventions for risk mitigation. On the other hand, few methodologies are available to systematically compare ante and post mitigation design risk, along with the verification of the economic convenience of these actions. The aim of the paper is to demonstrate how these limits can be at least partially overcome by integrating, in the traditional Cost-Benefit Analysis schemes, the As Low as Reasonably Practicable (ALARP) logic. According to it, the risk is tolerable only if it is impossible to reduce it further or if the costs to mitigate it are disproportionate to the benefits obtainable. The research outlines the phases of an innovative protocol for managing investment risks. On the basis of a case study dealing with a project for the recovery and transformation of an ancient medieval village into a widespread-hotel, the novelty of the model consists of the characterization of acceptability and tolerability thresholds of the investment risk, as well as its ability to guarantee the triangular balance between risks, costs and benefits deriving from mitigation options.

Public policy issues: Earthquake prediction

1979 ◽  
Vol 69 (5) ◽  
pp. 1533-1547
Author(s):  
Marie-Elisabeth Paté ◽  
Haresh C. Shah
Keyword(s):  
San Francisco ◽  
Earthquake Prediction ◽  
Earthquake Engineering ◽  
Cost Benefit Analysis ◽  
Risk Mitigation ◽  
Monitoring Program ◽  
Cost Benefit ◽  
Economic Life ◽  
Prediction Program ◽  
Prediction Techniques

abstract The object of this paper is to provide a method of cost-benefit analysis of earthquake prediction as a means of mitigation of earthquake effects. The research in earthquake prediction may or may not be successful and involves an initial cost. Earthquake prediction, if achieved, on the one hand provides society with information which allows it to take protective measures. On the other hand, each prediction involves the costs of those measures and the consequent disruption of economic life. The question is to assess the value of such information in a given state of the prediction technology. The evaluation of a fault-monitoring program and its consequences for the public at the time of predictions is performed over a 50-year period. A rate of growth, a social rate of discount, and a rate of improvement over time of earthquake prediction techniques are assumed. A model “TREE” is developed; it allows computation, for each year, of the expected value of the earthquake prediction information—expected costs minus expected benefits. The life component and the dollar component of the net result are kept separate throughout the evaluation. The final result is an expected cost per life saved through the earthquake prediction program over a 50-year time period. This allows comparison with the results of earthquake engineering and building codes (see Paté, 1978). It also allows comparison with the results obtained in other public sectors involving risk mitigation—health and transportation, for example. A numerical example has been worked out for the case of the San Francisco Bay Area; it gives a first approach to the results that can be expected from a prediction system with different assumptions on the success of research in that field. This paper is based on the doctoral thesis at Stanford University of M-E. Paté, under the supervision of Professor H. C. Shah.

Information Technology Process Improvement Decision-Making

2012 ◽  
Vol 3 (2) ◽  
pp. 18-35
Author(s):  
Sandy A. Lamp ◽  
Kathleen M. Hargiss ◽  
Caroline Howard
Keyword(s):  
Decision Making ◽  
Process Improvement ◽  
Cost Benefit Analysis ◽  
Investment Decision ◽  
Cost Benefit ◽  
Final Decision ◽  
Insurance Company ◽  
Senior Leadership ◽  
Structured Interviews ◽  
Process Managers

This article is derived from a qualitative multicase study with two settings that explored the way decisions are made in two IT organizations regarding process improvement initiatives by using face-to-face semi-structured interviews with 20 IT process owners and managers. The two participating organizations are a healthcare insurance company and a manufacturer of electronic interconnects. The study sought to uncover (a) how IT process improvements are prioritized and how approvals are attained, (b) how senior leadership is involved in decision making, (c) how security and risk are considered, (d) if and how formal process improvement methodologies are used, (e) if and how estimated and actual cost benefit analysis are conducted associated with decisions, and (f) how alignment with organizational goals is attained. The topic of IT governance was narrowed to explore the perspective of IT process owners and process managers, and their approaches and methodologies used with IT process improvement initiatives. The study found that pre-decision stages take place in IT investment decision making, and that process owners and process managers, participants other than senior leadership, and executive level decision makers are involved in these pre-decision stages and may be involved in the final decision stages.

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