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(RISK-2516) Variability in Accuracy Ranges: A Case Study in the Canadian Power Transmission Industry

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Level: Intermediate
Author(s): John K. Hollmann, PE CCP CEP DRMP FAACE Hon. Life; Andrea Almeida, P.Eng.; Raminder S. Bali, P.Eng.; John M. Boots, P.Eng.; Kevin Burnham; Victor Hsieh; Qaiser Iqbal, P.Eng.; Donald Konan, P.Eng.; Guillaume Lafortune, P.Eng.; Joe Ly; Clement Wu, P.Eng.
Venue: 2017 AACE International Annual Meeting, Orlando, FL

Abstract: This paper presents a case study of the variability in accuracy ranges for cost estimates in the Canadian overhead power transmission industry. The study sought to improve the participant’s understanding of risks and estimate accuracy for their major overhead power transmission projects. The study team also sought to verify the theoretical accuracy curves identified in the AACE® International Recommended Practice (RP) 18R-97: “Cost Estimate Classification System – As Applied in Engineering, Procurement, and Construction for The Process Industries”. The study team collected and analyzed actual and phased estimate cost data from 39 projects with actual costs from 2 million to 655 million (2016$CAN) completed from 2007 to 2016. Greenfield and brownfield overhead transmission projects from across Canada were included. This study compares the range bandwidth (uncertainty) as stipulated in AACE® RP 18R-97 with the actuals from this study. The accuracy ranges and the project’s under or over estimation of contingency is compared with published data from other industry studies.