jd edwards upgrade p roject...the system consists of components from oracle corporation canada, inc....

A REPORT TO

THE BOARD OF COMMISSIONERS OF PUBLIC UTILITIES

JD EDWARDS UPGRADE PROJECT

Hydro Place

July 2011

JD Edwards Upgrade Project

Newfoundland and Labrador Hydro i

Table of Contents

1 INTRODUCTION ................................................................................................................ 1

2 PROJECT DESCRIPTION ..................................................................................................... 2

3 EXISTING SYSTEM ............................................................................................................. 3

3.1 Age of Equipment or System ............................................................................... 3

3.2 Major Work and/or Upgrades ............................................................................. 3

3.3 Anticipated Useful life .......................................................................................... 4

3.4 Maintenance History ........................................................................................... 4

3.5 Maintenance or Support Arrangements .............................................................. 4

3.6 Vendor Recommendations .................................................................................. 5

3.7 Operating Regime ................................................................................................ 5

4 JUSTIFICATION ................................................................................................................. 6

4.1 Net Present Value ................................................................................................ 6

4.2 Cost Benefit Analysis ............................................................................................ 6

4.3 Historical Information .......................................................................................... 6

4.4 Status Quo ............................................................................................................ 7

4.5 Alternatives .......................................................................................................... 7

5 CONCLUSION .................................................................................................................... 8

5.1 Budget Estimate ................................................................................................... 8

5.2 Project Schedule .................................................................................................. 8

APPENDIX A ............................................................................................................................. A1

APPENDIX B ............................................................................................................................. B1


Newfoundland and Labrador Hydro Page 1

1 INTRODUCTION

The JD Edwards (JDE) suite of applications has been used by Hydro since 1998 to manage

data entry and reporting for all business and customer service processes within the

company. The system is used to record information in connection with the following

business activities:

Components provided by Oracle Corporation Canada, Inc.:

• General Ledger

• Accounts Payable

• Accounts Receivable

• Fixed Assets

• Job Costing

• Purchasing

• Inventory

• Human Resources

• Payroll

• Plant Equipment Management

• Work Orders

Components provided by AMX International:

• Customer Services

This suite generates Hydro’s customer billing, payroll and work orders for the maintenance

of assets. In addition, it maintains all underlying accounting transactions.



2 PROJECT DESCRIPTION

The project will upgrade our JD Edwards suite of applications from version A7.3 Cume 14 to

the latest release of this application A9.2. Version A9.3 is due to be released in the first

quarter of 2012, therefore if that version is available at the time of installation, it will be

implemented.

All internally developed applications and third party applications that interface with the JD

Edwards suite will be tested and modified as necessary.



3 EXISTING SYSTEM

The JDE Upgrade Project is required to upgrade the software applications to the latest

supported release. Without upgrading the software, support will no longer be available for

fixes and enhancements. Components such as the Payroll will no longer function as tables

needed for calculating taxes will no longer be updated.

The system consists of components from Oracle Corporation Canada, Inc. (Oracle); and AMX

International (AMX). The AMX component, used by the Customer Services group, was

originally purchased from Oracle.

As this budget involves the upgrade of an existing piece of software, the following items are

not considered relevant to the proposal:

• Levelized Cost of Energy;

• Legislative or Regulatory Requirements;

• Forecast Customer Growth;

• Energy Efficiency Benefits;

• Losses during Construction;

• Outage Statistics;

• Industry Experience;

• Availability of Replacement Parts;

• Safety Performance; and

• Environmental Performance.

3.1 Age of Equipment or System

The JD Edwards suite of applications was originally installed in 1998.

3.2 Major Work and/or Upgrades

Table 1 shows the upgrades that have occurred since installation.



Table 1: Major Work or Upgrades

Year Major Work/Upgrade Costs

2004 A73 CUME 14 Upgrade $163,186

3.3 Anticipated Useful life

There is no announced end of life date for the JDE suite of applications. However, the

vendor will no longer provide support for the version used by Hydro.

Upgrading to the next scheduled release, A9.3, which is due out in Quarter 1 of 2012 will

give support until 2017. As newer versions of the software are released they will be

supported for five years from the date of availability.

3.4 Maintenance History

There have been no upgrades to this software since 2004. Since then, the vendor, Oracle

Corporation Canada introduced an “Applications Unlimited” strategy for all its applications.

Under this strategy Oracle guaranteed support of Hydro's version of the JD Edwards suite of

applications until December 13, 2013. This removed the need to upgrade during that period

See Appendix A - Applications Unlimited Support Dates for JD Edwards World Releases.

3.5 Maintenance or Support Arrangements

Hydro has an agreement with Oracle Corporation for approximately $340,000 per year to

maintain Oracle components. Hydro also has an agreement with AMX International for

approximately $7,000 per year to maintain support for the Customer Services module.



3.6 Vendor Recommendations

The vendor recommends that all customers upgrade to one of its A9 versions. The versions

are A9.1 and A9.2. Version A9.3 is scheduled to be available in Quarter 1 of 2012.

3.7 Operating Regime

The JDE Suite of applications is normally run on a continuous basis. However, during the

nightly backup of system data, the system is unavailable. Normally during two weekends

per year the server operating the JDE system is upgraded. During that period, the system is

unavailable.



4 JUSTIFICATION

This project is justified because Premier (highest level) support for Hydro’s existing JDE

version A7.3 expires December 31, 2013.

Without the upgrade Hydro will be dropped to “Sustaining Support” status. Sustaining

support does not provide the following:

• New updates, fixes, security alerts, data fixes, and critical patch updates

• New tax, legal, and regulatory updates

• New upgrade scripts (routines to upgrade the software)

All of this support functionality is important. In particular, Hydro needs tax updates to

correctly calculate payroll taxes. Without this upgrade Hydro will no longer be compliant

with tax regulations under the Canada Income Tax Act. See Appendix B.

4.1 Net Present Value

A net present value calculation was not performed as there are no viable alternatives.

4.2 Cost Benefit Analysis

As there are no quantifiable benefits, a cost benefit analysis has not been performed.

4.3 Historical Information

There is no historical information pertaining to this upgrade.



4.4 Status Quo

The status quo is not an option because the current version of JDE will not be supported by

the vendor after December 31, 2013. Without this support Hydro will not be complaint with

tax regulations.

4.5 Alternatives

There are no viable alternatives that will incorporate into the existing system. The only alternative

would involve replacing the entire existing JD Edwards suite of Applications.



5 CONCLUSION

The JD Edwards suite has been in use since 1998. It supports Hydro’s core business

transactions. An upgrade is required to ensure that these core business transactions remain

supported by the application provider.

5.1 Budget Estimate

The budget estimate is shown in Table 2.

Table 2: Budget Estimate

Project Cost:($ x1,000) 2012 2013 Beyond Total

Material Supply 0.0 0.0 0.0 0.0

Labour 130.3 136.8 0.0 267.1

Consultant 135.4 296.4 0.0 431.8

Contract Work 0.0 0.0 0.0 0.0

Other Direct Costs 4.9 8.4 0.0 13.3

Interest and Escalation 13.4 39.2 0.0 52.6

Contingency 0.0 106.8 0.0 106.8

Sub-Total 284.0 587.6 0.0 871.6

Cost Recoveries (96.6) (199.8) (296.3)

TOTAL 187.1 388.8 0.0 575.3

5.2 Project Schedule

The anticipated project schedule is shown in Table 3.

Table 3: Budget Schedule

Activity Start Date End Date

Planning Planning Activity May 2012 Aug 2012

Design Design Activity Aug 2012 Sept 2012

Procurement Procurement Activity Aug 2012 Sept 2012

Construction Construction Activity Sept 2012 April 2013

Commissioning Commissioning Activity May 2013 May 2013

Closeout Closeout Activity June 2013 June 2013


Appendix A

Newfoundland and Labrador Hydro A1

APPENDIX A

Applications Unlimited Support Dates for JD Edwards World Releases


Appendix A

Newfoundland and Labrador Hydro A2


Appendix B

Newfoundland and Labrador Hydro B1

APPENDIX B


Appendix B

Newfoundland and Labrador Hydro B2

jd edwards upgrade p roject...the system consists of components from oracle corporation canada, inc....

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