The development of a system dynamic tool for ...

Asset management practice R. Buxton, G. McDonald, E. Seville, M. Daly, N. Smith It has MERIT! The development of a system dynamic tool for modelling the economic effects of infrastructure outages

Sustainable organisational change through asset management

Overview • Introduction • Purpose of MERIT • The development process • The model • Where to from here?

Introduction Funding • 2012 Research Investment Round (MBIE), $2.8 million over 4 years • 18months left

Focus to date •Single infrastructure outages •Economic Model •Interdependencies •Business behaviours •Disaster scenarios and impacts (Auckland Volcanic Field and Alpine Fault)

Purpose of MERIT “Develop understanding of the economic impacts of infrastructure failure in a post disaster context” Identify and explore: 1. Temporal and spatial changes in GDP, employment, income, labour/capital markets etc. from different types of failure 2. Causal mechanisms through time (interdependencies, cascading effects, feedbacks and lags) 3. The effect different mitigation (pre-event)/response (postevent) options (policy, infrastructure, business) have on the economic impacts

Natural disasters….

(pictures from “Aftershock”)

• Natural • Earthquake - Hiaiti • Tsunami – Boxing day • Storm – Wellington!!! (pictures wikipedia.org & NZ Herald)

Disasters – man made

• Accidental – Chernobyl • Deliberate – 9/11

(pictures wikipedia.org and NYC Police)

The development process •

MERIT = Measuring the Economics of Resilient Infrastructure Tool

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“Action research”, multi-disciplinary, multi-team

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Each team targets a specific part of the MERIT tool

The teams • Team one – scenario development • Team two – business behaviours • Team three – economic model development • Team four - outreach

Case Studies • Water Outage – Watercare Services • Power Outage – Vector/Transpower • Port Outage – Lyttelton Port • Auckland Volcanic Field • NZ Airports Association, Auckland Council Road Pricing, Ports of Auckland • Investment prioritisation, asset management, mitigating risk, speed of delivery

Business behaviours •

Identifying and modelling business responses to infrastructure failure

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Draws heavily on real patterns exhibited by businesses following the Christchurch earthquake series

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Survey results turned into causal loop diagrams that are incorporated into the MERIT model

The MERIT model(s) MERIT Model Non-Spatial MERIT Model

Population Module

Dynamic Economic Module

Land Use Change Module

Business Adaptations

Exogenous Drivers Scenarios Infrastructure outages Non-infrastructure impacts Mitigations/adaptations Pop/labour force Economic futures (e.g. world prices) Land use zoning

Base datasets/ Assumptions SAMs/IOs Prod./consmp. functions Business behaviours Infrast. interdependencies Land use maps

Merit Inoperability Model

Interdependencies Module

Input-Output Module Business Adaptations

MERIT Modules and Levers Economic module * Population module

Spatial module

Interdependency module

Geonamica® integration platform

Business adaptation levers Policy and strategic response levers

* 3 economic modules – inoperability (short term focus), fully dynamic (short to medium term focus), and spatial dynamic (medium to long term focus)

Outage scenarios

Other models

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MERIT Infrastructure embedded throughout modules

How is MERIT applied?

Outage maps Impacted Business Results Sector Output - Auckland

MERIT

200,000

150,000

NZ$2007m pa

Business Operability

100,000

50,000

0 8 Manufacturing Services

8.25

8.50 T ime Primary

8.75

9

Interdependency Definition • Interdependencies defined: Reliance of sector A on sector B (basically a ‘supply chain’ concept) • Other ‘related’ concepts: • Hotspots – colocation v ‘supply chain’ (not to be confused – our focus is the latter) • Pinch points – single points of failure (not a main focus in interdependency work) • Cascading interdependencies • Turning points

Interdependency Module Assumptions and context: •Top down approach •National / sector level •Main supply-chain relationships (adjusted for back-ups) –Extension: roads, rail and ports (freight) –Deals with single and multiple outages in different sectors simultaneously •Timing matters •Consequence, not likelihood

Interdependence Schematic Oil sector Transportation sector

Telecom’s dependency on oil

Telecom’s dependency on transportation

Interdependent infrastructure….a by-product of modern life? • “Critical infrastructures, including primarily the energy, financial services, health care, public services, and transportation sectors, are interconnected and interdependent on multiple levels” – Svendsen and Wolthusen, 2007.

(picture wikipedia.org)

Interdependence examples…Florida hurricanes 2004 • Energy shortage – closing of ports disrupted supply of petrol, coal and emergency supplies • Communications – cooling water supplies cut off shutting down telecommunications in turn disrupting repair crews • Electricity – impacted communications, transportation (rail and traffic signalling systems failed) • Electricity – impacted water and waste water, pumping stations and treatment plants (American Lifelines Alliance)

Infrastructure Sectors ID 1 2 3 4 5 6 7 8 9 10

Sector Name Electricity Petroleum Gas Telecoms Roads Rail Ports Airports Water Sewers

Classification of Interdependencies • 10 sectors x 10 sectors = 100 possible dependencies • We have looked carefully at each of these dependencies and classified them as: • High [15 out of 100] • Medium high [16] • Medium [13] • Medium low [10] • Low (no dependence) [36] • Intra-sector dependencies [10]

List of Interdependencies ID

This sector depends

7 Elec

on this sector

Importance

Description

Roads

Med-high Roads needed for vehicle access to many sites, some of them remote.

Rail

Rail used occasionally for transport of heavy equipment. Huntly has own coal but also uses Med-low rail from Tauranga - however, coal not generally critical for NZ's electricity supply - Huntly usually runs on gas.)

9 Elec

Ports

Ports used occasionally for landing heavy equipment. (Huntly has own coal but also uses Med-low Tauranga port - however, coal not generally critical for NZ's electricity supply - Huntly usually runs on gas.)

10 Elec

Airports

Low

Elec

Refinery: Production relies on Transpower, but petroleum stocks in supply chain can be drawn down and new imports can arrive within 6 - 8 weeks. Refinery to Auckland Pipeline: Med-high Electricity required. Downstream petroleum supply: Very reliant on electricity (pumping at terminals and service stations). footer

8 Elec

11 Ptrlm

Occasional use of air freight.

Level of Service The graph shows the how the level of service provision in one sector (Xaxis) converts to level of service provision in another sector (Yaxis) footer

Auckland Water Supply Scenario • Single infrastructure scenario – hypothetical event • Failure of both tunnels at Ardmore leading to the loss of the southern trunk supply (62%) • 40 day scenario

Auckland Power Outage Scenario • Hypothetical scenario formulated by Transpower & Vector • Auckland network • 8 x 220kV circuits, high load demand, relative lack of local generating capacity • Transpower scenario loss of all of Transpower’s 220kV lines north of Whakamaru • only 2 of the 8 x 220kV circuits into Auckland remain in service • With and without Otahuhu generation • Region-wide voltage collapse due to circuit overloads and fast voltage drop

Auckland Power Outage Scenario • Given the Transpower scenario, Vector performed outage modelling in house • Vector’s strategy involves • Uninterrupted supply to critical customers • Implement 3-hourly rolling outages for others • Outage duration: until restoration of Transpower supply to GXPs • Assumed a 36hr period of rolling outages, 12hrs inspection by transpower, further 24hrs to restore supplies to GXPs

Next Steps • AVF and Alpine Fault Impacts and Outage Maps • DEVORA and ALG input • Integration of data into the model(s) • Adaptation options (levers) • e.g. evacuation, business relocation, business recapture • Operationalising the model • Interface, availability, ease of generating outage data • Speed of delivery

Thankyou from the MERIT team!