The Study On Model Of Concession Pricing Of BOT Project Of Sewage Treatment

BOT becomes more and more popular on the construction of sewage treatment plants in cities of China. However, there are no suitable theories to instruct BOT project of sewage treatment in China yet. It is hoped that a scientific and reasonable pricing model will be set up to instruct the BOT project of sewage treatment's constructing, with a notable character of risks allocation.It is concluded that, among those stakeholders of BOT project of sewage treatment, the local government and purveyor are the two most important parts, which could stand for others.It is through literature search and expert inquiry to get the 11 key risk factors and its allocation. local government takes on the change of sewage supply, sewage pipe net construction risk, the promotion of environment standard, the change of toll policy, the increase of investment, delay, and sludge disposal risk. The purveyor takes on interest rate change. They both take on production factors' price change, inflation. The third part takes on force majeure risk.After analyzing the goals and principals of risk disposal of government and purveyor, it is confirmed that the model is composed of two parts, one is basic pricing model, and the other is the adjustments to basic price. The basic pricing model represent the purveyor's taking on risks. And the adjustments represent the government's taking on risks.The basic pricing model is made of NPV method. The risks that purveyor takes on are quantified to the pricing factors. Bringing the pricing factors into model formula, and letting NPV=0, it will get the basic price.The adjustments to basic price are made according to the risks government takes on. The price adjustment will make it facility to adjust the concession price, when the BOT project of sewage treatment encounters troubles during it running period, and safeguard government and purveyor to achieve their goals.