Patrick DeCorla-Souza
P3 Program Manager
Center for Innovative Finance Support
Wim Verdouw
Financial Modeler IMG/Rebel
Intro - Project Background
Part A - Risk Valuation for use in VfM Analysis
Part B - Risk Valuation for use in BCA Analysis
Part C - Valuation of Lifecycle Performance Risk and
Revenue Uncertainty
Recap - Summary of Webinar
A study was done previously by a state DOT to estimate VfM and net social benefits of P3 delivery for a highway project. The various inputs required for the analysis are included in the P3-VALUE 2.0 spreadsheet model.
PSC | |
Base variability on pre-construction costs | 10.00% |
Base variability on construction costs | 17.00% |
Base variability on O&M costs | 10.00% |
Cost of equity | 12.00% | % p.a. |
Gearing (debt-to-equity ratio) | 75.00% | % |
Debt maturity | 30 | years |
Debt interest rate | 6.00% | % p.a. |
Equity bridge loan interest rate | 6.00% | % p.a. |
- | ||
Difference between Availability Payment WACC & Toll Concession WACC* | 1.60% | % |
Differences between P3 and Conventional Delivery that could affect P3 risk values may include:
Please stand by as we open the Excel file
Item | Risks under Conventional Delivery | |
---|---|---|
NPV risk values ($M, Column G) |
Nominal risk values ($M, Column H) |
|
Total Pure risks (row 28) | 69 | 121 |
Total Base variability (row 34) | 79 | 112 |
Lifecycle performance risk premium (row 36) | 228 | 574 |
Revenue uncertainty adjustment (row 38) | 130 | 377 |
Total risks under Conventional Delivery (row 45) | 505 | 1,184 |
Item | Risk Retained by Agency under P3 | |
---|---|---|
NPV risk values ($M, Column J) |
Nominal risk values ($M, Column K) |
|
Pure risks (row 28) | 6 | 11 |
Base variability (row 34) | 7 | 10 |
Lifecycle performance risk premium (row 36) | - | - |
Revenue uncertainty adjustment (row 38) | - | - |
Total risks retained under P3 (row 45) | 13 | 21 |
Risk Transferred to P3 Developer | ||
---|---|---|
Item | NPV risk values ($M, Column M) |
Nominal risk values ($M, Column N) |
Pure risks (row 28) | 40 | 98 |
Base variability (row 34) | 54 | 94 |
Lifecycle performance risk premium (row 36) | 93 | 515 |
Revenue uncertainty adjustment (row 38) | 51 | 382 |
Total risks transferred under P3 (row 45) | 238 | 1,089 |
Nominal values | ||
---|---|---|
Item | PSC ($M, Column H) |
P3 ($M, Column K + Column N) |
Pure risks (row 28) | 121 | 109 |
Base variability (row 34) | 112 | 104 |
Lifecycle performance risk premium (row 36) | 574 | 515 |
Revenue uncertainty adjustment (row 38) | 377 | 382 |
Total risks transferred under P3 (row 45) | 1,184 | 1,110 |
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Differences between P3 and Conventional Delivery that could affect P3 risk values may include:
Please stand by as we open the Excel file
Item | Delayed Conventional Delivery Risk values NPV @ 3.00% ($M) for PDBCA (Column G) |
Conventional Delivery Risk values NPV @ 3.00% ($M) for PDBCA
(Column J) |
---|---|---|
Pure risks (row 28) | 52 | 62 |
Base variability (row 34) | 63 | 74 |
Lifecycle performance risk premium (row 36) | 147 | 185 |
Total risks (row 38) | 262 | 321 |
Item | Conventional Delivery Risk values NPV @ 3.00% ($M) for PDBCA (Column J) |
P3 Risk values NPV @ 3.00% ($M) for PDBCA (Column M) |
---|---|---|
Pure risks (row 28) | 62 | 57 |
Base variability (row 34) | 74 | 71 |
Lifecycle performance risk premium (row 36) | 185 | 171 |
Total risks (row 38) | 321 | 299 |
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Please stand by as we open the Excel file
Item | Nominal value | |
---|---|---|
Base Case (from Part A) | Revised Scenario ($M, Column H) | |
Total Pure risks (row 28) | 121 | 121 |
Total Base variability (row 34) | 112 | 112 |
Lifecycle performance risk premium (row 36) | 574 | 575 |
Revenue uncertainty adjustment (row 38) | 377 | 579 |
Total risks under Conventional Delivery (row 45) | 1,184 | 1,387 |
Nominal values | ||
---|---|---|
Item | Base Case (from Part A) | P3 ($M, Column K + Column N) |
Pure risks (row 28) | 109 | 109 |
Base variability (row 34) | 104 | 104 |
Lifecycle performance risk premium (row 36) | 515 | 517 |
Revenue uncertainty adjustment (row 38) | 382 | 586 |
Total risks transferred under P3 (row 45) | 1,110 | 1,316 |
Nominal values | ||
---|---|---|
Item | PSC ($M, Column H) |
P3 ($M, Column K + Column N) |
Pure risks (row 28) | 121 | 109 |
Base variability (row 34) | 112 | 104 |
Lifecycle performance risk premium (row 36) | 575 | 517 |
Revenue uncertainty adjustment (row 38) | 579 | 586 |
Total risks transferred under P3 (row 45) | 1,387 | 1,316 |
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Intro Project Background
Part A Risk Valuation for use in VfM Analysis
Part B Risk Valuation for use in BCA Analysis
Part C Valuation of Lifecycle Performance Risk and
Revenue Uncertainty
FHWA's Center for Innovative Finance Support Website:
https://www.fhwa.dot.gov/ipd/
P3 Website:
https://www.fhwa.dot.gov/ipd/p3/
Submit a question using the chat box
Patrick DeCorla-Souza
Center for Innovative Finance Support
Federal Highway Administration (202) 366-4076
Patrick.DeCorla-Souza@dot.gov