BDM Consulting is pleased to release the MRO Inventory Benchmarking Study, sponsored by NV Energy. The purpose of this study was to identify MRO (maintenance, repair and operations) inventory levels by generation technology (Coal, gas, combined cycle, etc) and MRO inventory practices within organizations of similar size and diversity. Eighteen organizations were contacted for the study with only five of these organizations completing the survey for this release.  Targeted organizations included Allegheny Energy, Arizona Public Service, Dominion, Exelon Corporation, FirstEnergy, Florida Power and Light, Idaho Power, Kansas City Power & Light, NV Energy, Pacific Gas and Electric (PG&E), PacifiCorp, Portland General Electric, PPL, Progress Energy Inc, Salt River Project, Southern California Edison, Southern Company, San Diego Gas & Electric.  The results of this benchmarking study are just a level of comparison to understand the magnitude of MRO inventory value. However, these results lead to a bigger picture: with many cost factors and an unpredictable demand, management of MRO inventory levels must be tackled with extreme accuracy and with the best practices in order to fully realize potential cost savings. Please complete the online contact form for more information about this study. The study explored MRO inventory value per Mega Watt capacitiy across coal, gas, combined cycle and other generation technologies.

Some of the recommendations from the the MRO Inventory Benchmarking Study included Understanding MRO Demand through:

• Clear definitions of asset and demand criticality definitions and classifications
• Uniform process for initial provisioning of spares at the time of equipment design and validation
• Establishment of realistic equipment and component standards
• Complete and accurate asset hierarchies, item descriptions, equipment spare parts lists, critical spares classification, manufacturer’s part number

Additional recommendations from the study included Developing a Supply Chain Logistics Strategy that achieves desired service levels:

• True understanding of MRO consumption fundamentals
• Reduction of unnecessary planned replacement activities
• Application of the right replenishment algorithms for setting reorder points/ reorder quantities for inventoried items
• Establishing of service levels by item class and criticality
• Development of inventory sharing strategy to separate inventory bleed down objectives from virtual/physical stocking of shared spares