Recently my profession has come under a bit of fire for sub-par performance of buildings and failure to prosecute the engineers behind the CTV building collapse. The main response seems to have been re-branding from “The Institute of Professional Engineers of New Zealand” to “Engineering New Zealand” – perhaps they were concerned that the word “professional” was a bit misleading? They’ve also issued a document called Engineering a Better NZ, with this stunning piece of advice:
If community expectations don’t match what will be delivered, it’s because engineers have failed to accurately convey risk.
This is possibly accurate, but it’s also a somewhat depressing version of “caveat emptor” – you didn’t like what you bought, which isn’t the fault of the seller except inasmuch as they let you buy it. Like all professionals working in the area of seismic retrofitting, I’ve had my share of conversations about why a second, or even third, round of strengthening is needed as seismic codes are refined and our understanding of risk evolves.
The truth is that risk is something that’s fairly heavily buried even for us – I’ve posted on that once or twice in the past. There are layers and layers of probabilistic evaluations that need to be made for every step of the process. The design and evaluation standards we use do their best to summarise the best-guess median values for different key properties, and we take both a detailed and holistic view of the risks. We assess, we evaluate, we rank – we fix the worst risks. But what is risk? How can we understand this word in a useful way and fulfil Engineering NZ’s mandate?
The basic definition of risk is:
Risk = f(Probability of Occurrence, Consequence of Occurrence)
We’ve got to understand probability here not in terms of will it/won’t it, but as a matter of how far into the future the event happens. Seismic activity in Wellington is inevitable, but it’s not inevitable today, or tomorrow, or within the next five years. What we have is a time-bound probability field, where the probability of a minor earthquake within 5 years is X, the probability of a minor earthquake within 50 years is some multiple of X, the probability of a major earthquake within 5 years is some fraction of X, and so on. So we can think of this from the inverse perspective – the average interval between now and a minor earthquake is 1/X, which we could think of as some kind of lifetime.
The “New Building Standard” requirement of 33% is just such a minor earthquake, while the 100% level is a major quake (these being the two most relevant scenarios for practical purposes). Using our inverted way of thinking, 33%NBS represents an average lifespan of 1/X years, while 100%NBS represents a much longer average lifespan before the building is destroyed. Given that a 100%NBS earthquake is based on a 500-year return interval, and buildings are “intended” to survive for 50 years, we roughly think of a 100%NBS building as having a 10% chance of encountering a 100%-level shake. A 33%NBS quake has a correspondingly shorter return interval of 150 years. So we can, extremely roughly, think that a 33%NBS building has a “lifetime” not of 50 years, but of 15 years. I suspect it is not entirely coincidental that the timeframe required for strengthening is 15 years for most buildings, 7.5 for the most critical.
In terms of the consequence of failure, what the “New Building Standard” means is that the building is safe to evacuate, but that the building is probably a write-off afterwards. In engineering-speak we could talk about this as “resilience”, but that’s another topic for another post. If we think that the “lifetime” of a building is 15 (or, indeed, 50) years, then the only sensible thing to do is to depreciate its value over that period with a view to replacing the building entirely when the event happens.
Risk then declines over time, at least in financial terms. In the first year of an Earthquake Prone building’s life, the chances of a >33%NBS earthquake are 1/150, and the consequence is a total financial loss. In the second year, the chance of a >33%NBS earthquake is 1/150, but the consequence is a financial loss of (15-1/15)%. And so on. After 15 years, the consequence has virtually declined to zero, so the risk is zero. What this requires, however, is a 15-year plan with sufficient funding. You could then think of risk instead as a comparison of rates – what if I depreciate the building over 20 years instead of 15, that extends the exposure period by 5 years.
Whereas, what’s happening right now is that owners target 34%NBS and then assume Risk = 0 at that point. If those owners who strengthened to 34%NBS (although it was expressed differently in my youth) had seen that as a deferment or extension of a replacement cost, right now they’d be tearing down those risky hulks and building far more profitable modern buildings. Always assuming, of course, that the mystics in charge of so-called “Heritage” in NZ allow them to do the sensible thing.