Value engineering is a proven engineering technique which utilizes a systematized approach to seek out the highest value option; initial and life cycle costs are paramount in the value engineering. This paper presents an integrated methodology of Value Engineering and Risk Analysis for Tunnelling Projects, which are considered high risk operations due to the high uncertainty associated with the available information required for construction. This methodology couples value engineering based on SAVE International standards and a structured risk analysis process, and utilizes sensitivity analysis for life cycle cost. The proposed methodology differs from current practice in each of its three steps: risk analysis, criteria evaluation, and sensitivity analysis. In the proposed methodology, firstly, risk analysis is a quantitative analysis in which risk factors are evaluated for each of the options and the expected cost of risk is evaluated for each option which is later added to the options cost. Secondly, criteria evaluation is done using the analytical hierarchy process (AHP) which accounts for consistency. Thirdly, the value calculation has a direct relationship with life cycle cost, which can vary based on assumptions for the financial parameters (interest rate and inflation rate); sensitivity analysis is used to explore the assumptions' sensitivities and account for those variations. This paper will present the methodology framework and its use in a case study adopted from the City of Edmonton - South Edmonton Sanitary Sewer Stage SA10.
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