Multi-sector Asset Investment Planning at Rheinische NETZGesellschaft

Rheinische NETZGesellschaft mbH (RNG) manages and operates over 30,000 km of distribution networks for electricity, gas, water, and district heating, supplying approximately 2 million customers in and around Cologne, Germany. RNG manages 25 networks with interfaces to different asset owners and asset service providers through centralized asset management.

The complexity of RNG’s operating environment drove the need for an Asset Investment Planning (AIP) solution to help the company establish a value- and risk- oriented asset management approach and enhance its AIP processes.

The Solution

www.rng.de

The implementation of IFS Copperleaf AIP, including IFS Copperleaf Portfolio™ with the Asset Aware Investments option, is helping RNG align its AIP processes with the ISO 55000 asset management standard and achieve the following results.

Benefits include:

• �One consistent investment portfolio available in a centralized, enterprise-wide platform

• �Consistent execution of processes

• �Greater transparency and a clear line of sight

• �Enhanced decision making with full traceability and comparability

https://www.rheinnetz.de/

ELECTRICITY

23,133 KM CUSTOMERS

1.8 Million

GAS

8,825 KM CUSTOMERS

2 Million

WATER

6,850 KM CUSTOMERS

1.5 Million

DISTRICT HEATING

350 KM

Key Drivers for Change

To support its digitization, decentralization, and decarbonization business goals, RNG embarked on a journey to establish a value-based and risk-informed asset management approach. The following challenges were key drivers that led to the selection and implementation of the IFS Copperleaf solution:

Compliance with the ISO 55000 asset management standard

RNG voluntarily and proactively set out to implement the core requirements of ISO 55000, a series of international standards focused on helping organizations maximize value from assets by balancing cost, risk, and performance. To align with these principles, RNG needed greater transparency and consistency in its decision-making processes and the ability to optimize investment portfolios to deliver the highest value.

Managing risk and investment across multiple networks and asset owners

RNG’s spreadsheet-based approach was not providing an adequate understanding of asset risk across the different networks, or the ability to identify the best set of investments to mitigate those risks. RNG needed a solution to streamline this process and create an optimal investment plan, while taking into consideration numerous funding, resource, and timing constraints.

Supporting the workflow from portfolio creation to project execution

The strategic and operational portfolios are central to RNG’s business. Creating, optimizing, and approving these portfolios requires complex decision making and specialized workflows to ensure every investment request is checked, processed, and evaluated using well-defined, repeatable, and transparent processes.

Streamlining interaction between asset owners and asset service providers

As the asset manager, RNG works with multiple asset owners that have different needs for their networks. At the same time, RNG also interacts with multiple asset service providers that execute the work in the field. Both groups have their own unique requirements, processes, and operating constraints. RNG needed a way to manage each network independently while at the same time, handling all interactions in a consistent and transparent way.

Higher Value Plans

IFS Copperleaf Portfolio and the Asset Aware Investments option enable RNG to: 1. Model, document and understand asset risks

2. �Create and manage its strategic portfolio as well as approve mid-term plans

3. �Manage and monitor its operational portfolio during work planning and execution

As the first step in the process, RNG uses IFS Copperleaf to model, document, and understand risk, cost, and value over time for each asset. The transparency around risks is used together with input from asset strategies and network planning to create investment requests. The IFS Copperleaf Value Framework makes it possible to consistently assess the value of all investments on a common economic scale and ensure decisions are aligned with RNG’s strategic objectives. With IFS Copperleaf’s AI-powered optimization, RNG can then explore different asset investment strategies and identify the optimal combination of investments that will deliver the highest value—while taking into account funding, resource, and timing constraints.

The different types of investments are created and inserted into a portfolio structure that separates the different networks. Using a hierarchical tree structure allows each network to create its own branch that can be individually managed and optimized.

RNG has different types of strategic investments:

• �Single investments, such as a new substation

• �Special programs, such as mitigating a risk caused by a specific asset model from a certain manufacturer

• �Continuous programs, such as base programs that can vary in terms of the number of assets or length of network replaced every year; these programs are intended to maintain the underlying condition of the system

Additionally, specific budgets are used to enable the asset service providers to react on short notice—to repair a fault for example. IFS Copperleaf Portfolio enables RNG to manage all investment types and budgets in a single, centralized system. Automated workflows are used to manage processes, such as the mid-term plan approvals and interaction with relevant stakeholders, including asset owners. Dashboards make it easy to visually compare

and contrast the timing, costs, risks, and value of various investment strategies for greater transparency and more informed decision making.

Managing and monitoring the operational portfolio

Once the mid-term plan is finalized, the investments approved for the following year are handed over to RNG’s operational team. These investments form the operational portfolio and are the basis for RNG’s interaction with the asset service providers. Through IFS Copperleaf Portfolio’s business intelligence dashboards, and integration with the IT systems of RheinEnergie, its parent company, stakeholders can access real-time data to drive more efficient and transparent decision making.

The IFS Copperleaf solution provides line of sight and structured interaction between RNG, the asset owners, and the asset service providers. The asset service providers plan work on behalf of RNG and RNG approves or rejects these detailed plans. Once work is approved, the asset service providers can execute the planned work and RNG receives updates on the status of planning and execution of work. Because IFS Copperleaf Portfolio supports continuous planning, any variances between planned work and actual performance are highlighted and can be addressed.

We will further improve our investment decision-making processes with the help of IFS Copperleaf. It provides a standardized, value-based methodology that supports asset investment planning and portfolio optimization in the context of 13 different asset owners, 8 asset service providers, and 25 networks.”

Dr. Ulrich Groß CEO RNG

Benefits and Improvements Realized

The implementation of IFS Copperleaf Portfolio has enabled RNG to establish a risk-informed, value-based, and objective decision-making process that balances the needs of all stakeholders. Having a centralized platform supporting the entire AIP process provides:

• �A complete, streamlined workflow from portfolio creation to investment/project execution

• �Greater transparency at the interfaces to asset owners and asset service providers

• �Management and control capabilities for risks and investments in a complex environment with 25 networks and 13 different asset owners

• �Capabilities needed to consider and manage limited resources both internally and externally (e.g., with service providers)

With the help of IFS Copperleaf Portfolio, RNG can visualize and communicate the value of planned investments for a specific asset type, for a specific district, and for the entire network. In addition, variations of the baseline scenario can be developed to optimize the value of aggregated investment portfolios. The optimization is based on measurable contributions to capacity expansion and risk reduction under specific constraints such as budget and resources. With these additional scenarios, planning experts can explore the effects on budget and resource requirements, validate feasibility from a resource perspective with asset service providers, and compare potential solutions to select the optimal investment strategy.

With IFS Copperleaf Portfolio, RNG is able to answer crucial questions such as:

• �How do technical risks evolve in the overall network, in certain areas, or for specific asset types/groups (for example, if old cable sections have a shortened life expectancy)?

• �Which parts of the networks have an urgent need for action?

• �Is enough work planned to meet the asset owners’ objectives?

• �Which scenarios can be undertaken with today’s budget?

• �Which scenarios will negatively impact other important strategic objectives?

• �Which topics must be discussed with external stakeholders, such as the municipality?

• �How does limited resource availability impact the network and asset owners’ ability to achieve their objectives?

As a strategic asset manager, I need to be able to replan frequently—and proactively. This requires flexibility and the ability to explore different asset investment strategies quickly so that we have a variety of alternatives ready for execution. Our asset service providers also need to adapt to constant replanning of capacity, to correspond with the aims and objectives of ISO 55000 asset management practices in an open and transparent way.”

Jan Patrick Linossier Head of Network Strategy RNG

Find out more For more information, contact us

or visit our website at copperleaf.com

https://www.copperleaf.com/