Risk Identification And Assessment Of Water TOT Projects

In recent years, TOT franchise has been widely used in water investment projects, so that the production efficiency of water enterprises, quality of service for water supply and drainage, as well as the operating efficiency, have shown significant improvements. The TOT mode avoids the process of project construction, facing less restraint and being more practicable. The characteristics of TOT mode itself determine that it has been more appropriate for the operation and construction of existed urban infrastructure. It is of great significance to improve the operating situation of traditional water projects which have disadvantages in financing ways, technology and management mode. However, there are some greater or smaller risks in different phases and aspects during the startup and operation of the water projects using TOT mode. Some risks are determinant of the project if they are not controlled well, although they get a very small probability of occurrence; some risks being the type with great probability of occurrence and significant impact, such as government risk, including credibility and paying ability of government. It is a very important problem for the investors to evade these riks and insure the success and profit of the TOT projects.For the purpose of better risk management of the water TOT project, this paper developed research on the base of summarizing past research achievement of risk management in water TOT mode, focusing on the two key phases of risk management: risk identification and assessment. From the perspective of investors, this paper analyzed the risk factors identification and derived the risk evaluation model in water TOT projects. Furthermore, it included a demonstration analysis of Jiangbian waste water project of TOT mode in Changzhou city using risk evaluation model.In the course of research we gained the basic information of risk identification by using the method which combines interview and questionnaire survey. Totally we surveyed 15 water investment projects (some of them are in TOT mode), collecting 28 valid questionnaires in the first survey and 9 valid questionnaires in the second survey. This paper built an identification framework of water TOT project through interviews and related literature review; gained the key risk factors of water TOT project based on questionnaire survey; put forward a modified model of risk assessment based on FAHP method, obtaining the ranking of different risks' influence through thequantitative calculate of the risk in Jiangbian TOT project.