The DWMP blog – Episode 8. Plan forwards or backwards?

If you haven’t already seen the earlier episodes in this series, I suggest that you start from Episode 1 (https://tinyurl.com/DWMP-blog).

In Episode 7 I discussed strategies for selecting the best options to meet the level of service failures for a planning scenario.?In Episode 6 I discussed setting up a range of future planning scenarios.?So how do we put those two things together and develop the best options across all future scenarios.

We would normally have three future scenarios.?A) will occur in something between 5 years and 15 years.?B) will occur in something between 15 years and 25 years and C) will occur no earlier than 25 years, if at all.

Our objectives in developing the scenario planning are:

• Deliver best whole life value.
• Avoid redundant assets.
• Minimise repeated disruption to customers and communities.

The strategies that we adopt depend on the type of option that we are considering implementing.?I put them into three groups.

Incremental – options such as SuDS retrofit, where we can do one street one year then do another street the following year without problem.?The costs are largely linear with the size.

Modular – options such as attenuation storage or treatment works units, where we can build one module this year but allow for connections so that we can easily build a second module in the future.?The costs are again roughly linear but with an extra cost for the first module.

Monolithic – options such as upsizing a sewer or tunnelling a new interceptor.?There is no sensible way to go back and increase the size in the future, so we need to build for the long term.

There are some fuzzy boundaries between Modular and Monolithic where cost rather than practicality becomes a factor.?Delaying a second module doesn’t make sense if the second lot of site set-up costs outweigh the reduced net present cost of the delayed work.?Conversely, it may be possible, although expensive, to build a second parallel sewer rather than upsizing the first one.?These choices will depend on the discount rate or cost of capital used to assess whole life value.?The higher the discount rate the better to delay construction, the lower the rate the better to build now for the long term.

So, do we start by designing for the short term and then look further ahead, or do we start with the long term and then reduce the scope for the short term??I propose that we start in the middle and work outwards.?Why??

Scenario C may actually never be required so it should not form the backbone of our plans. ?If we design for Scenario A and then expand to Scenario B or C, we are very likely to have rework or abandoned assets.?Scenario B is almost certain to be required within our planning horizon and sets a robust long-term plan.?We can scale back for Scenario A and build in allowances for Scenario C.

Start by designing for Scenario B and develop the optimum combination of options.?Then for any monolithic options check if they would need to be larger for Scenario C and if earlier construction gives an overall saving.?If so, then include the larger version.

Now do a similar check for modular options.?Would they need to be bigger for Scenario C and would the extra cost of phased construction outweigh the saving from delayed spend??From this decide on the appropriate size to include for Scenario B.

Now we would look at Scenario A.?The scale of the difference from Scenario B will depend not just on future trends of growth and climate change but also whether we have chosen a glidepath from current performance to long term future performance targets.

We review the options selected for Scenario B to see if any of them could not be implemented in time for Scenario A.?Major monolithic options may take too long to design and construct.?If so remove them from Scenario A.?

We now work backwards through the remaining options that we selected for Scenario B, taking out those with the worst cost benefit first and seeing if we can still meet the needs of Scenario A.?For modular or incremental options try scaling back the size rather than removing them altogether if some contribution is still needed to deliver the Scenario A targets.

It may be that without the options that cannot be delivered in time some additional options may be required for Scenario A and that these potentially become redundant.?Try to avoid this by bringing forward other components that will contribute to Scenario B or C into Scenario A.

Once an initial strategy is defined, review the phasing and costs.?Does phased construction of the modular options give the best value??Would the implications for community disruption be too great?

Finally, consider if any of the investment is needed immediately to remedy unacceptable current failure of levels of service.?In particular this would consider maintenance needs and property level flood protection for properties at high risk of flooding.

That is probably enough detail for the future plan for the DWMP at this stage, but when the plan is reviewed in the future and the need to move to Scenario B is identified, then the exact sequencing of the component options in Scenario B should be reassessed in more detail.

Questions

I am not sure that anyone has actually used the start in the middle and work out strategy.?Will it work?