K&M Advisors - Maintenance Cost Calculation Using RAV Study

Maintenance Cost Calculation Using RAV Study

Water – En Energiebedrijf (WEB) Aruba is interested in estimating a prudent maintenance budget using WEB’s Replacement Asset Value (RAV) and a maintenance cost ratio (MCR).
Under this assignment, K&M was responsible for calculating the Replacement Asset Value (RAV) for WEB’s assets (using the CEPCI index and original asset price), conducting a literature review and market research to understand the industry-standard MCR, calculating WEBs historic MCRs to analyze trends, and using the RAV and MCR to calculate the prudent maintenance budget for the upcoming year. K&M will provide both this calculation and a report describing the methodology, sources, assumptions and results that can also serve as a guide for WEB to conduct these calculations in the future.

K&M was engaged by the U.S. Trade and Development Agency (USTDA) on a Definitional Mission (DM) to aid in decision-making processes related to funding activities that enhance the pipeline development for the Alliance for Green Infrastructure (AGIA) in sub-Saharan Africa. The mission is centered on identifying and evaluating potential green infrastructure projects in diverse sectors such as renewable energy, transport and logistics, water and sanitation, broadband and ICT infrastructure, health, and urban and rural infrastructure, for funding consideration by members of AGIA’s Project Preparation pillar, including USTDA and Africa50.

As part of this engagement, K&M’s responsibilities include conducting preliminary project analysis by identifying viable projects through collaboration with USTDA, Africa50/AGIA, and through outreach to key stakeholders, while also screening these projects based on USTDA and AGIA’s funding criteria, which include climate resilience. The team is also tasked with traveling to Africa50 headquarters and various host countries to close information gaps and engage with prospective project sponsors and stakeholders.

Further duties involve a detailed project analysis where K&M prioritizes and recommends projects that are best suited for USTDA and Africa50/AGIA funding. This includes preparing up to ten draft Project Reports, developing terms of references (TORs), project budgets, and task completion schedules. These reports are meticulously crafted to incorporate feedback from USTDA and Africa50/AGIA and finalized accordingly.

The culmination of K&M’s work is the preparation of a Final DM Report that aligns with USTDA’s requirements, encapsulating all the Project Reports. This comprehensive approach ensures that the mission not only aligns with the strategic objectives of AGIA but also significantly contributes to sustainable infrastructure development across sub-Saharan Africa, fostering global green growth initiatives.

IDB Invest has hired K&M to conduct a comprehensive research project aimed at fostering best practices and uncovering new opportunities in establishing inclusive and sustainable value chains within Port Infrastructure projects across the LAC region. Beginning with an exploration of the construction and operational phases of Ports’ value chains, the initiative will discern the components that incorporate MSMEs and identify prevalent sustainability trends within these chains. K&M will conduct an in-depth analysis of the Ports’ Value Chains, pinpointing the products and services offered at each stage, the complexity, required technical knowledge, certifications, and other pertinent criteria sought by project sponsors. The study also aims to grasp the procurement dynamics, identify key stakeholders, and pinpoint MSME participation levels across the value chain components. Furthermore, the research will emphasize key sustainability trends like decarbonization, climate change adaptation, and fair treatment of employees, among others. To achieve these objectives, K&M will gather information from various sources, conduct interviews with industry stakeholders, generate written reports and visual presentations, and engage in regular discussions with the IDB Invest team.

IDB Invest has engaged K&M to conduct a study on the best practices and opportunities in inclusive and sustainable value chains for Ports Infrastructure projects in the LAC region. The primary focus is to identify components within the value chains during the construction and operation phases of ports, particularly those involving MSMEs, and to assess current sustainability trends.

K&M’s approach starts with a deep analysis of Ports’ Value Chains, covering both construction and operational stages. The study will identify all products and services within the value chain, analyze their sequence, and evaluate criteria such as technical requirements and certifications needed from suppliers. The research will also explore procurement processes to determine the roles of various stakeholders like project sponsors, operators, or third parties.

A key aspect of the study will be to recognize areas of the value chain with significant MSME participation, ranking them based on factors like MSME involvement, product complexity, and supplier capability. Furthermore, K&M will explore prevailing sustainability practices in ports, covering topics such as decarbonization, climate change adaptation, and biodiversity conservation. This will involve comparing current practices across existing LAC ports and considering MSMEs as integral users of the port.

K&M’s research methodology will encompass both primary and secondary data sources, including statistical data, academic literature, and industry studies. They’ll also utilize recent value chain analyses from the IDB Group and gather insights from interviews with industry experts, businesses, and port operators. The findings will be documented in detailed reports and visual presentations, with regular feedback sessions with the IDB Invest team to ensure alignment.

Water en Energiebedrijf Aruba (WEB) had engaged K&M to conduct an Electric Vehicle Business Case Study. The main goal of this assignment was to support WEB in identifying and evaluating potential business models for their involvement in the electric vehicle charging industry in Aruba.

To accomplish this objective, K&M executed the following activities:

K&M reviewed electric vehicle regulations and assessed existing business models implemented in comparable countries. This analysis served as a foundation for identifying suitable approaches for electric vehicle charging in Aruba.
K&M identified various business models specifically tailored for electric vehicle charging in Aruba. These models encompassed scenarios where WEB would be responsible for the financing, construction, and operation of electric vehicle charging stations.
K&M developed an economic model to assess the feasibility and potential profitability of each identified business model. Additionally, K&M scrutinized the regulatory landscape to determine if any new regulations were necessary to enable the implementation of these models effectively.
K&M provided WEB with comprehensive recommendations on how to proceed with their electric vehicle charging business. These recommendations were based on the evaluation of the different business models and took into consideration the economic analysis and regulatory requirements.

By conducting the Electric Vehicle Business Case Study, K&M played a vital role in assisting WEB in evaluating and identifying the most suitable and viable business models for their involvement in the electric vehicle charging sector in Aruba.

Oserian Two Lakes Power’s (OLTP) geothermal power plant is an important part of Kenya’s renewable energy and climate change prevention strategy. OLTP engaged POWER Engineers for support in ensuring a total load of 8 MW can be provided to industrial clients at Oserian via a high-voltage interconnection to Kenya Power and Light Company’s (KPLC) 33 kV distribution grid located nearby to avoid short-term use of diesel generation while OLTP further develops its geothermal resources.

K&M was engaged by POWER Engineers on a project to support the development of a geothermal/solar hybrid industrial park in Naivasha, Kenya, by providing an analysis of the requirements for interconnection of the industrial park to the national grid of Kenya to supply backup power. This project will provide technical assistance for the specification and design of a synchronized interconnection between the nearby 33kV KPLC line to the OTLP 11kV mini-grid.

K&M’s scope of work includes the following:

Assessing the commercial and economic viability of the KPLC interconnection and its impact on the cost of power to OTLP’s industrial clients
Identifying the factors that influence the economics of the project and of combined power provision by both geothermal resources and the KPLC distribution grid
Recommending an operating procedure for decision makers to choose between OTLP geothermal/solar and KPLC grid-provided power

As part of its scope of work, K&M considered a range of technical options coupled with capital and operating expenditures (CAPEX, OPEX) to assess the economics of grid-supplied vs. geothermal-supplied electrical energy. K&M will incorporate factors such as KPLC time-of-use and bulk rate electricity tariffs, expected utilization characteristics of OTLP electrical load (timing, intensity, duration), and estimate investment and operational requirements to model and evaluate the project economics. K&M will identify factors that influence the economics of the project and evaluate their sensitivity and impact during fluctuations. Lastly, K&M will provide clear recommendations and operating procedures that identify when to use OTLP-provided geothermal power and when to use KPLC grid-provided power.

K&M compared the two (2) options (OTLP or KPLC supplied energy) on the basis of the lowest cost per unit of electricity under standard assumptions and produce a Cost-Benefit Analysis for the project.

K&M served as Owner’s Engineer to the Egyptian Electricity Authority for the engineering design, procurement and construction supervision of Egypt’s first subscriber fiber-optic carrier loop system. This project provided a short-term reliable telecommunications link between Cairo and the 1,200 MW El-Kureimat Power Station under construction 100 kilometers south of Cairo.

K&M assessed the legal, regulatory, financial and investment framework for ARENTO as a first step in moving the utility towards commercialization and a competitive market entity. K&M undertook a policy reform and institutional framework analysis of the telecommunications sector in Egypt to determine constraints to ARENTO’s development as a progressive, financially viable telecommunications utility employing appropriate management and organizational structures. K&M performed a cost of service/tariff rate study to rationalize the institutional reform process. K&M’s evaluation and review also included: assessment of the legal, regulatory, and investment framework to determine steps necessary for the eventual commercialization and/or privatization of ARENTO; ARENTO’s operations technical assessment; ARENTO’s organizational assessment; and determine ARENTO’s optimal human resource requirements.

K&M was hired to provide ARENTO with a basis for designing and implementing an effective strategy for future telecommunications pricing. K&M worked closely with ARENTO executives and Egyptian government officials to ensure the feasibility and practicality of alternative tariff structures and other service enhancements evaluated in the study. This assessment was an integral component of ARENTO’s efforts to increase operational efficiency, decrease costs and improve customer service quality. The ability to accurately determine costs and establish an acceptable and equitable tariff rate assisted ARENTO to facilitate future planned investments, reduce debt, and improve its viability as a corporate entity.

K&M managed the Infrastructure Finance Advisory Service Program as part of the US-Asia Environmental Partnership (US-AEP) for the USAID. The US-AEP was a cooperative effort managed by USAID in conjunction with the Export-Import Bank of the U.S. (EXIM), the Overseas Private Investment Corporation (OPIC), the Trade Development Agency (TDA).

K&M, supported by Pulsatron Technology Ltd. (the British technology licensor) and the Washington, D.C.-based Sheet Metal Worker’s International Association (holder of U.S. installation and maintenance rights), was engaged by US DOE to conduct a study to estimate the cost and schedule for design, installation and potential testing of a Pulsatech™ pollution control device on a plasma furnace at DOE’s Western Environmental Technology Office (WETO). K&M’s assessment reviewed available information on Pulsatron science and technology as well as potential commercial application and market considerations.