December 30, 2013
Risk Allocation is an approach to optimizing the mitigation of risk, rather than eliminating the risk altogether, and assigning risk to the party (public or private) best able to manage it.
Chapters 2 and 5 of the Primer offer guidance on determining the appropriate risk allocation for P3 projects based on project type and procurement structure.
Using the Risk Assessment Tool
The user may document risk allocation of each risk in the "risk allocation" columns of the "Allocation & Mitigation" section of the 'Risk Register' tab. For each risk, the user may input the share of the public and private sector as a percentage. The total allocation must equal 100 percent for each risk. If the total value entered for the risk allocation is greater than 100 percent, the cells will turn red to indicate that the values need to be adjusted. The cells will not turn red if the total value is less than 100 percent, though, so users should be careful when entering their assumptions.