Asset Cost Information Services Feasibility Study

Report No WSAA 137

August 1998

 

EXECUTIVE SUMMARY

 

 

The objective was to investigate the feasibility of establishing a service to provide Asset Cost Information Services (ACI) to the Australian Water Industry. Asset Cost Information would be provided for all phases of asset life including corporate planning, strategic planning, capital works planning, project development and implementation, and asset use (operations, maintenance and refurbishment).

 

The research found:

 

·         Australian Water authorities wish to improve the supply and availability of asset cost information and would be prepared to pay for an external service provided if it was relevant to their business, accurate and appropriately priced;

 

·         No suitable service is currently available in Australia or overseas;

 

·         The cost of establishing a service is very expensive – it could be over $2 million.

 

·         The potential Australian market for a service is not large.

 

·         The data collected from this report suggests that the establishment and provision of an ongoing Asset Cost Information service would not be financially viable.

 

·         A service could be established and become viable if some of the upfront costs were subsidised, for example:

 

q       Water authorities provided or developed cost functions (or models) free of charge;

q       WSAA (or government) subsidised the establishment costs of the service.

 

Further research effort is required in order to:

 

·         Undertake detailed market research to accurately determine the demand for an Asset Cost Information service and willingness to pay either for the whole service or specific parts of the service;

·         Assess the availability of upfront subsidies to develop the service.

 

This report recommends that the WSAA:

 

·         Critically review the findings of this research report to assess whether the WSAA wishes to spend further resources to prove the feasibility of an Asset Cost Information Service;

 

·         If further expenditure on research effort is warranted, then progressively undertake the activities in the proposed Implementation Plan.

 

Copies of the Report are available from WSAA, price $A60. Orders may be placed through the Bookshop at www.wsaa.asn.au or by email to info@wsaa.asn.au.