Integrated sustainability analytics to support asset planning and investment

Jiean Ling, doctoral practitioner in sustainability at the University of Surrey, discusses why the water sector needs an asset planning strategy which considers long-term impacts on a holistic spectrum of sustainability.

Sustainability has been widely recognised as a paramount goal for long term societal and economic development. Sustainable water sanitation and supply is one of the Sustainable Development Goals proposed by the United Nations. Given the increasing number of challenges faced by water companies, it has become increasingly important to operationalise sustainability in long-term asset planning and investment.

The notion of sustainability is closely relevant to the urban water cycle. Water companies need to sustain the operation of their assets to constantly provide services to customers and comply with regulations. However, the acceleration of climate change and population growth makes a sustainable water cycle more challenging than ever.

More frequent occurrences of summer droughts and wetter winters mean that the weather is becoming more unpredictable and extreme. The influx of population in urban areas compounds the pressure to deliver sustainable water and wastewater services. All of these have accelerated the need for future asset investments that are resilient and sustainable.

The notion of sustainability is multi-disciplinary. It encapsulates the importance of environmental, social and economic aspects of any activity, which is commonly known as the ‘Three Pillars’ of Sustainability. Given the broadness of this model, sustainability should be firstly tailored to the organisational and decision context. We need to define and clarify what constitute sustainable asset investments based on the organisational and decision context. For example, carbon and energy efficiency is one the key environmental criteria because of the Net Zero target by 2030.

Biodiversity gain is also an increasingly important criterion to improve the ecological status of sites as the UK government published its Biodiversity Strategy 2020. In terms of social sustainability, the impacts and benefit of asset investment to the local community should also be considered. Economically, whole life costing is the key financial criterion to determine the viability of investment options. On top of that, resilience and efficiency are also highlighted in the current Asset Review Period (AMP7). The decision criteria are constantly evolving and expanding to accommodate current regulations and policies.

To evaluate those sustainability criteria, many digital and analytical tools have been used in asset management and planning such as Risk Assessments, Cost-Benefit Analysis, Environmental Impact Assessments and Financial forecasts etc. However, the integration of multiple tools into a single asset investment and decision-making system is practically challenging as those tools are not directly compatible with each other.

Multi-Criteria Analysis (MCA) is a collective term for a range of methods that provide integrated and holistic analytical support. It has been widely used for decisions and policy-making in various industries. The strength of MCA is that it offers a relatively simple and coherent process for decision-makers to analyse multiple, and sometimes, conflicting decision criteria. For examples, to invest in new treatment technologies, asset managers need to look at a holistic perspective of sustainability including energy and carbon efficiency, whole life costs, its operational performance, incremental public values and so on. MCA allows managers to aggregate all the relevant criteria using a specific mathematical model and identify the best overall solution to implement.

The use of integrated analytical tool should be supported by strong stakeholder engagement and communication. There are two reasons for this. First, engagement is necessary to enable the information sharing pathway for data collections and validation. In order to integrate all sustainability criteria into one centralised analytical system, we should also integrate ‘people and teams’ who are closely working with those criteria in the water companies.

Second, good stakeholder engagement often leads to a better quality of analytics. If every piece of knowledge or insight is a piece of puzzles, we need many to build a comprehensive perspective of sustainability. By sharing knowledge between people and team, we can offset the limits of memory and information capacity of individuals. This will often lead to a more balanced and well-informed asset investment decision.

In the post-Covid period, it is vital for water companies to adjust and realign their asset planning strategy with sustainability. Although the concept of sustainability is broad, it should be clearly defined and tailored to the organisational and decision context. Multi-Criteria Analysis provide great opportunities to perform integrated analytics to evaluate asset solutions based on the ‘Three-Pillars’ of sustainability, supported by stakeholder engagement.

By integrating the multiple pillars of sustainability into asset decisions, it becomes easier to identify the strength and weakness of each solution comparatively and inform investment decision from a holistic perspective. In the trend of asset digitalisation, integrated analytics can accelerate this transition and contribute to ‘smarter’ asset decisions.

Jiean Ling is a registered postgraduate research student of the Practitioner Doctorate in Sustainability programme at the University of Surrey in partnership with Thames Water Utilities.