Assessing the value of distribution infrastructure replacement

Many utilities have defaulted to a policy of run-to-failure as their strategy for managing distribution assets by postponing initiation of a program of preemptive infrastructure replacement. What has caused utilities to do what they instinctively believe is short-sighted likely includes their inability to clearly predict such a program's return on investment. Southern California Edison (SCE) has developed a method of performing long-term probabilistic forecasts of the reliability of its distribution system as a function of investments in preemptive infrastructure replacement, i.e., a method to calculate the payback.