Rolling Up Operational Risk at PG&E

ProbabilityManagement.org and members of the Gas Operations team at Pacific Gas & Electric collaborated on an article for OR/MS Today introducing the idea of the Consolidated Risk Statement for Operational Risk.

Gas Operations at PG&E has been developing probabilistic models that leverage internal, external, and academic data to help make business and strategic decisions in the face of uncertainty. The Open SIPmath Standard assures that these models may be used collaboratively with other groups to provide an overall risk snapshot that allows diverse stakeholders to assess tradeoffs between safety, reliability and cost. The ultimate goal is to create a standardized consolidated risk statement that aggregates operational risk across the physical assets of the system in the manner that a consolidated financial statement aggregates the financial health of the firm.