Implementing Maximo to Manage Work and Asset Classes at Tucson Electric Power

1. Presenters: Implementing Maximo to Manage Work and Asset Classes at Tucson Electric Power Terry Krafthefer Director, IT Business Relationship Management Tucson Electric Power Company Rob MacArthur President GenesisSolutions

2. Topics • UniSource Overview • Enterprise Asset Management Overview • Enterprise Asset Management at TEP • Work & Asset Management • EAM Deployment Approach • Technical Challenges • Benefits Expected/Business Case • The Future MX 7 Implementation EAM Strategy Enterprise Wide

3. UniSource Energy Overview Headquarters: Tucson, Arizona USA Investor-owned

4. UniSource Energy Overview Generation Transmission Distribution Distribution Distribution

5. UniSource Energy Overview

6. UniSource Energy Overview

7. UniSource Energy Overview

8. Enterprise Asset Management at UniSource Work & Asset Management System Deployments: • STORMS (1997) – Distribution Design/Build • MP2 (1998) – Substation & Transmission maintenance • FleetFocus (1998) – Fleet maintenance • Maximo (2000) – Tucson power generation • 2020 System (1988) – Springerville power generation • Numerous in-house developed applications

9. Enterprise Asset Management Overview • Strategy-Driven • Best Practices • Key Program Objectives • Reliability Based Maintenance Program • Effective Planning & Scheduling • Effective MRO Inventory Management

10. Enterprise Asset Management - Definition • Whole life optimal management of the physical assets of an organization to maximize value • Covers design, construction, commissioning, operations, maintenance and decommissioning/replacement of plant, equipment and facilities • “Enterprise" refers to the management of the assets across departments, locations, facilities and business units • Managing assets across the facility, organizations will improve utilization and performance

11. Enterprise Asset Management 65 Participants / 1,300 (+) Plants / 463,000 (+) Employees *ARC Advisory Group 2010 EAM and Field Service Mgt 09

12. Enterprise Asset Management ROI Increased Production Capacity Reduced Maintenance Costs Reduced Downtime Improved Efficiency Planned Labor Planned Material

13. Enterprise Asset Management Pyramid EAM Metrics & Performance Improvement Maintenance & Reliability Strategy Work Management Inventory Management Planning & Scheduling Organizational Readiness CMMS Functionality & Utilization

14. EAM Maturity Continuum Progression Improve & sustain Don’t just fix it, improve it Enterprise Measure & fix Reliability Alignment (shared vision) Integration (Supply, Operations, Engineering) Differentiation (System Performance) Alliances Predictive Fix it BEFOREit fails Eliminate Defects Improve Precision Redesign Value Focus Planned Fix it AFTERit fails Performance Measures Predict Plan Schedule Coordinate Reactive Plan Schedule Coordinate Defer Maintenance People “Fire Fighting” Heroes Overlapping Responsibilities Role Based Training Defined Roles & Responsibilities Cross Trained / Bench Strength Limited Development Planning Materials & Inventory Management Kitting Materials & Scheduling Technicians Monitoring Technician Work Execution Total Productive Maintenance Processes CMMS PM Management CMMS Planning & Inventory Management CMMS Scheduling & Robust Reporting CMMS Automated Work Generation CMMS Life Cycle Cost Tracking Systems Technology Limited Utilization Electronic Document Management Systems Predictive Technologies Mobile Handheld Devices Barcoding & RFID Utilization Minimal Performance Tracking Lagging Indicators Leading & Lagging Indicators Continuous Improvement Efforts Organizational Metrics Aligned Governance

15. Enterprise Asset Management - Definition 85% reduction in downtime; 30% increase in production output; 27% decrease in operating costs

16. Enterprise Asset Management at UniSource • Initiatives to consolidate work & asset managementsystems (EAM): 2002 – Budget withdrawn 2004 – Lack of executive sponsorship 2009 – Executive buy-in to Maximo 2011 – Assessment of work & asset management systems

17. Work and Asset Management Systems IT Maximo T&D Phase I - Maximo Crew/Exception Scheduling Rubber Goods In Maximo Job Log UNSE T&D Engr Maximo Proposed T&D Phase II MP2 Job Card Power Plant Maximo Relay Wk Mgmt UMS/SqlCAD New Service Application Tree Trimming Storms ERTF - UES MISC Shop Activity Project Control Number Database Trouble Investigation Crew Scheduling warehouse ERTF Inventory Fuel Focus Power Production SGS Systems Outside Services Work Management SAGE MA Exception scheduling warehouse ERTF - TEP Transportation Fleet Focus 2020 Work Order Tracking Transmission Outage System Crew callout Design Build TLamp TeleComm Call Center UNS GAS WMS Exception Scheduling HEAT Substation Crew Scheduling Workforce Management Joint Use Kingman Outage Management Crew Scheduling HEAT

18. Operate Maintain Asset Lifecycles Maximize Asset Performance & Value As-Built Maintenance Plan Construction Warranties In Service Scheduling Build Performance Analysis Resources Failure Analysis Materials Plan System Analysis Permits Design Cost Analysis Retire/Salvage Plan 1 Yr. CAPX $$ 10-50 Yrs. O&M $$

19. Enterprise Asset Management at UniSource • Maximo at TEP: 2000 – Initial Maximo deployment (Tucson power generation) 2009 – Maximo (ITSM) deployed in IT 2006-2010 – Maximo upgrade (Tucson power generation) 2010 – Maximo deployed to Engineering 2011-2012 – Phase 1 Maximo deployment to T&D

20. EAM Deployment Approach • Phased • Deployments in 9-18 month cycles (vs. years) • Each deployment has value – not dependent on others • Migrate systems where (& when) it makes sense • Criteria include: • Value to the business • Lifecycle status

23. Technical Challenges • Three instances (IT, Generation, T&D) • Keeping upgrades in synch • Phased growth • Planning for the future while building for the present • Integrations • Replacing point-to-point with middle tier (BPEL) • Resourcing • Staff provide support as well as work on new deployments • Migrations from legacy systems • Purchased as well as internally developed systems

24. Benefits Expected/Business Case • Vendor supported version of Maximo. • Improved process consistency and optimization. • Improved visibility of work, status, and resources across work groups • Enhanced reporting and Key Performance Indicator (KPI) tracking. • Improved Capital Work Order processing. • Improved scheduling capability. • Improved time reporting. • Elimination of Excel workbooks and MS Access databases. • Enhanced regulatory reporting via workflow. • Consistent training and post-production support.

25. Lessons Learned • Select vendor with technical & industry expertise • Establish common understanding of project goals • Utilize same vendor when building requirements and executing implementation • Ensure common understanding of requirements • Need thorough understanding of data migration – especially external (to Maximo) data sources • Effective participation of sponsor, leadership, & business resources • Communication is crucial. Listening is key.

26. Future direction with T&D and other areas • IT organization deployed ITSM in July 2009 • T&D Engineering deployed Maximo in January 2011 • Corporate goal to assess applications in 2011 for future disposition • Maximo for T&D (Phase 1) began in April 2011 • Potential Maximo deployment through rest of power generation (assessment underway)

27. Questions? Presenters: Terry Krafthefer, Tucson Electric Power Company tkrafthefer@tep.com Rob MacArthur, GenesisSolutions rmacarthur@genesissolutions.com