Criticality Analysis for optimising OPEX cost lifecycle

Abstract

Identification and quantification of cost and value of industrial assets is a field in which much terminology is mixed. When we try to analyze the importance of an asset for our business, to discuss about its costs should not be separated from the value provided by the asset. Most of the times, managers only use the term “cost” because it seems to be more objective. Value is more subjective and more difficult to define. However, we must try to use definitions as amortization, inflation, replacement value in order to simplify the concept of “value” to improve our decisions.

In the case of regulated companies, the economic valuation of the facilities is based on a legal normative, so the concept of “cost” may turn to be quite useless. Therefore, it is important to use a methodology that allows us to estimate the value of our assets. We have developed a criticality analysis of our infrastructures in order to assess the relative value of these items for the company. The target is to optimize the operation and maintenance (O&M) strategies at a corporate level. This must have a relevant impact in the OPEX of our company, and may be also an impact in future CAPEX.

This paper discusses the methodology and presents clear examples of how O&M strategy is transformed according to criticality assessments.