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Utilities\u00a0have many reasons to install new assets or rehabilitate existing assets.\u00a0The most common reasons include:\u00a0<\/span>\u00a0<\/span><\/p>\n Projects needed to address any of the issues described above should be compiled into a Capital Improvements Plan. The plan can be separated into short-term and long-term needs. The short-term plan, at a minimum, should cover 5 years, but\u00a0generally a\u00a0time horizon of 10 to 20 years is preferable. Although projects in years\u00a010 through 20 are more speculative in nature than those in the first 5 to 10 years, this time horizon helps\u00a0identify\u00a0those projects that will need to be addressed\u00a0relatively quickly. The long-term capital improvement plan should have a time horizon of 50 to 100 years,\u00a0so the\u00a0utility\u00a0can view the replacement of\u00a0almost all\u00a0of its assets over time. This long-term horizon matches the useful life of the longer-lived assets, such as buildings and\u00a0pipe, and enables the system to see replacement waves \u2013 those time periods in which many assets will require replacements within\u00a0a brief period. The replacement waves\u00a0reflect\u00a0the installation waves when many assets\u00a0were\u00a0installed at the same time.<\/span>\u00a0<\/span><\/p>\n The capital improvement plan should specify project priorities and the\u00a0anticipated\u00a0funding source for each one. The projects should be listed by the year in which they are planned. At a minimum, the capital improvement plan or CIP should include the following information:<\/span>\u00a0<\/span><\/p>\n To create the capital improvement plan, use data from the asset inventory: including useful life estimates, replacement cost, and condition to help\u00a0determine\u00a0what year each asset will need to be replaced and what it will cost for the replacement. The replacement year can be adjusted with data from asset performance, including failures, O&M\u00a0expenses,\u00a0and risk if any asset needs to be replaced sooner or can be kept in service longer.<\/span>\u00a0<\/span><\/p>\n The short-term capital improvement plan should be reviewed at least every few years to see if there are any changes needed. The\u00a0long-term\u00a0capital improvement plan can be reviewed every 5 to 10 years and adjusted based on current information.<\/span>\u00a0<\/span><\/p>\n [\/et_pb_text][\/et_pb_column][\/et_pb_row][\/et_pb_section]<\/p>\n","protected":false},"excerpt":{"rendered":" Capital Improvement Plans Utilities\u00a0have many reasons to install new assets or rehabilitate existing assets.\u00a0The most common reasons include:\u00a0\u00a0 Replacing or\u00a0rehabilitating\u00a0high-risk assets\u00a0 New assets needed to meet upcoming regulations\u00a0 Assets required for growth\u00a0 Assets needed to allow the system to\u00a0consolidate\u00a0or regionalize\u00a0 Asset replacement related to improved technology or energy efficiency\u00a0 Projects needed to address any of the issues described above should be compiled into a Capital Improvements Plan. The plan can be separated into short-term and long-term needs. The short-term plan, at a minimum, should cover 5 years, but\u00a0generally a\u00a0time horizon of 10 to 20 years is preferable. Although projects in years\u00a010 through 20 are more speculative in nature than those in the first 5 to 10 years, this time horizon helps\u00a0identify\u00a0those projects that will need to be addressed\u00a0relatively quickly. The long-term capital improvement plan should have a time horizon of 50 to 100 years,\u00a0so the\u00a0utility\u00a0can view the replacement of\u00a0almost all\u00a0of its assets over time. This long-term horizon matches the useful life of the longer-lived assets, such as buildings and\u00a0pipe, and enables the system to see replacement waves \u2013 those time periods in which many assets will require replacements within\u00a0a brief period. The replacement waves\u00a0reflect\u00a0the installation waves when many assets\u00a0were\u00a0installed […]<\/p>\n","protected":false},"author":1,"featured_media":0,"parent":0,"menu_order":0,"comment_status":"closed","ping_status":"closed","template":"","meta":{"_et_pb_use_builder":"on","_et_pb_old_content":"","_et_gb_content_width":"","footnotes":""},"class_list":["post-6899","page","type-page","status-publish","hentry"],"yoast_head":"\n\n
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