A Robust Bayesian Approach to an Optimal Replacement Policy for Gas Pipelines

Abstract

In the paper, we address Bayesian sensitivity issues when integrating experts’ judgments with available historical data in a case study about strategies for the preventive maintenance of low-pressure cast iron pipelines in an urban gas distribution network. We are interested in replacement priorities, as determined by the failure rates of pipelines deployed under different conditions. We relax the assumptions, made in previous papers, about the prior distributions on the failure rates and study changes in replacement priorities under different choices of generalized moment-constrained classes of priors. We focus on the set of non-dominated actions, and among them, we propose the least sensitive action as the optimal choice to rank different classes of pipelines, providing a sound approach to the sensitivity problem. Moreover, we are also interested in determining which classes have a failure rate exceeding a given acceptable value, considered as the threshold determining no need for replacement. Graphical tools are introduced to help decisionmakers to determine if pipelines are to be replaced and the corresponding priorities.

Document type: Article