HAZRISK (database and models)

Prepared by:

Independent Project Analysis, Inc. (IPA, Inc.)

Prepared for:

A group of private companies and the U.S. DOE.

Application:

Financial analysis:
Environmental impact analysis:	---
Waste management/P2:
Environmental cost listing/database:	---
Cost estimation:	---
Alternative product/process comparison:	---

A parametric cost estimating tool to provide order-of-magnitude cost estimates for Environmental Restoration (ER) projects.

Elements of control:

Cost control
Resource control	---
Estimating control	---
Schedule control	---
Scope control
Risk control

Development date and updates:

Research study began in 1988. Efforts are being made to expand the program to cover more projects.

Public availability:

Available to the sponsors of the HAZRISK research program

Purpose and current use:

The development of HAZRISK is funded by private chemical and oil companies and the US Army Corps of Engineers. The purpose is to provide industry and the government with improved methods of evaluating the cost and schedule risks(order-of-magnitude) of hazardous waste projects for both the Remedial Investigation/Feasibility Study (RI/FS) and Remedial Design/Remedial Action(RD/RA) stages of Environmental Restoration (ER) projects.

Cost information:

A software package was developed for the private-sector sponsors and includes the models and database. The license fee for this program and joining the HAZRISK research consortium is $35,000.

Contents and system requirements:

Models and proprietary database. IBM PC (or compatible) with Windows 3.1. The software has a worksheet to guide the user and provides results as probability distributions.

Software summary

Size and complexity of projects:

Primarily designed for larger projects.

Other compatible systems offered

System available in different modules.

Nonquantifiable information

Information not available.

HAZRISK gives users an understanding of the factors driving the cost growth and schedule slippage in ER projects. The database contains completed assessment and cleanup projects. The following type of information is contained in the database:

• general site information
  
• type of contaminant
  
• estimated and actual schedule
  
• cleanup technologies evaluated and selected
  
• project management information
  
• project funding information
  
• actual costs
  
• estimated costs
  
• regulatory and external events
  

Two types of models were developed and are used in combination to estimate project cost and duration and uncertainties surrounding the cost/schedule estimates:

• direct cost and schedule estimating models-use parametric techniques for estimation.
  
• cost contingency allowance-predicts contingency allowance required at alternative levels of risk.
  

Costs and schedules are systematically linked with project characteristics such as the nature of the site, contaminant(s), technologies, regulations, etc. The links are forged using parametric statistical techniques such as correlation and simple and multiple regression.

Life-cycle stages covered

Raw material acquisition	---
Manufacturing stage	---
Use/reuse/maintenance	---
Recycle/waste management

Type of costs considered

Conventional
Potentially hidden	---
Contingent	---
External	---

Method of cost estimation

The database includes historical costs and schedules for completed remedial actions. Data sources included EPA, DOE, private-sector sponsors, engineering firms, and the Army Corps of Engineers.

The software has a worksheet to guide users. The required inputs are site characteristics, site cleanup history, cleanup technology, and nature and type of contamination. Parametric statistical techniques are used to establish links between these factors and cost and schedule. Generation of financial indicators

Net present value (NPV)	---
Payback period	---
Internal rate of return (IRR)	---
Benefits cost ratio	---
Other	---

Ability to include environmental costs

User-friendliness and flexibility

HAZRISK is useful when there are uncertainties in project and technology definition. It gives good early estimates for cost and schedules, using only a few data inputs. The purpose is to complement and not to replace design-based approaches. The advantages of the statistical models are that they do not require detailed data; they allow project risk to be treated and measured explicitly.

User-support

IPA has produced two studies that are available to the HAZRISK sponsors: The HAZRISK Assessment Study and The HAZRISK Cleanup Study. These describe the methodology and approach used in developing the HAZRISK models. The program sponsors in 1991, and an independent DOE peer-review panel (reviewed it from the point of view of applicability to DOE) validated the accuracy of the models.

Limitations

The assessment cost and schedule data are taken only from the RI/FS phase of an environmental remediation project. Cost and schedule numbers reflect the costs of remedial construction and treating waste. Long-term recurring expenses(site maintenance, monitoring) and estimates of hidden or less-tangible costs are not included. HAZRISK is only available to the research sponsors.

Basis for evaluation:

The information provided here is based on a profile of the tool presented in the WEC (1992). Subsequent reviews were done by incorporating updated product information through telephone communications with IPA in May, 1995.

Contact information:

Independent Project Analysis, Inc. (IPA, Inc.)

11150 Sunset Hills Road, Suite 300

Reston, VA 22090.

Dean Findley/Jenny Painter

703-810-1266

703-709-0777

703-709-0838 (FAX)

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