Research On Investment Value Of Sewage Treatment PPP Project Based On Government’s Bilateral Guarantee Option

In recent years,the increasing water pollution problem made sewage discharge standards increasingly stringent.the development of the demonstration PPP project has effectively alleviated the problem of sewage treatment.According to the latest data from the PPP project database,as of the end of 2020,there are a total of 3000 sewage treatment projects,of which770 have an investment of more than1 billion,1053have an investment of 300 to 1 billion,and841 have an investment of 100 to 300 million.However,the investment of sewage treatment PPP projects is large,the operation cycle is long,and the income is unstable.Investors need to bear a lot of risks,and they are not attractive to investors.In order to reduce the risks and increase the attractiveness to investors,the investment is guaranteed at the same time The government is “profitable but not profitable”,the government generally achieves the goal of sharing project demand risks and benefit-sharing through bilateral guarantees.Therefore,we study the value of sewage treatment PPP projects considering the value of government bilateral guarantee options to provide a basic basis for investors’ investment decision-making.From the perspective of social capital,this article analyzes the characteristics of sewage treatment PPP projects and finds projects with unstable demand,the government generally provides bilateral guarantees share demand risks and allocate excess returns.This paper combines traditional evaluation methods with real options,uses real option pricing models to calculate the value of guaranteed options for minimum sewage treatment demand and excess demand and calculates investors under government bilateral guaranteed options considering the risk preferences of both parties Obtain the project investment value and substitute the constructed model into the actual sewage treatment PPP case to verify the reasonable validity of the model.The thesis research shows:The real option method can make up for the shortcomings of traditional investment evaluation methods,and it is more reasonable to evaluate the investment value of PPP projects considering the guarantees of both parties and the risk preferences of both parties.It is hoped that through the research of this article,it can be used as a reference for the research on the value of the government’s upper and lower guarantee options for sewage treatment PPP projects.