present_value_future_risk {CNAIM}

Present Value of Future Risk

Description

This function calculates the present value of future risk. See section 5.5 on page 32 in CNAIM (2021).

Usage

present_value_future_risk(pof, cof, r = 0.035)

Arguments

pof

A vector of the probability of failure of the asset over years

cof

The consequence of failure of the asset

r

discount rate

Source

DNO Common Network Asset Indices Methodology (CNAIM), Health & Criticality - Version 2.1, 2021: https://www.ofgem.gov.uk/sites/default/files/docs/2021/04/dno_common_network_asset_indices_methodology_v2.1_final_01-04-2021.pdf

Examples

present_value_future_risk(c(0.1, 0.2, 0.5), 100)