Concession Price Adjustment Mechanism For Public Private Partnership Waste-To-Energy Incineration Projects

With the rapid development of the national economy and the improvement of people's living standards,the output of Municipal Solid Waste(MSW)in China continues to grow.According to China's statistical yearbook,the volume of MSW cleared in 2017 exceeded 210 million tons.At present,Waste to Energy(WTE)is widely used to solve MSW,which can realize the reduction of Waste treatment,recycling and harmless.On the other hand,the application of PPP model in WTE can relieve the financial pressure of the government and improve the operation efficiency of the project.Concession price is one of the core terms of the concession agreement of PPP projects,and concession price adjustment mechanism is the most important part of concession price.However,due to the lack of a scientific and reasonable concession price adjustment mechanism,there are many cases of project failure caused by the lack of a good response mechanism after the occurrence of risks,which have attracted extensive attention from the practical and theoretical circles.This paper adopts the methods of literature research,content analysis,financial net present value analysis,system dynamics(SD)and case analysis to design a complete concession price adjustment mechanism.First of all,based on the theory of net present value and project characteristics,this paper identified and screened the influencing factors of the price system of the PPP project of waste incineration power generation in China,and corresponding the influencing factors and risk factors.Then,according to the identified influencing factors,a causal relationship graph and a stock flow graph were drawn based on system dynamics to establish a net present value model,and the rationality of the system dynamics price model was verified by taking the municipal solid waste incineration power generation project in quzhou,zhejiang province as an example.Finally,from the waste incineration power generation of the PPP project price adjustment of franchising triggering mechanism,the perspective of adjustment methods and procedures,the waste incineration power generation the PPP project price adjustment mechanism of franchising is designed to rise in price mechanism,price mechanism and penalty mechanism,and the influence degree of the largest waste supply risk as an example,detailed description of the price adjustment mechanism to run the program,the quzhou related data of the project,adjust the garbage supply,using system dynamics model to calculate the corresponding adjusted price confirming of franchising waste incineration power generation the PPP project integrity and effectiveness of the concession price adjustment mechanism.The research conclusions of this paper are as follows:(1)the reasons,methods and models of concession price adjustment are reviewed based on literature research.It is found that the concession price adjustment mechanism can guide the development of the concession price adjustment mechanism,improve the rationality of the government concession decision,ensure the interests of all stakeholders,and promote the successful implementation and efficient operation of the project.(2)based on the net present value theory on waste incineration power generation key factors influencing price of the PPP project charter,respectively is:expenditure on power construction investment,construction period,interest,raw material and fuel,maintenance,repair,liquidity,artificial wages and welfare funds,taxes and fees,the charter price,actual garbage processing,feed-in tariff,electricity,heating/warm;(3)based on system dynamics theory and VensimDSS software established waste incineration power generation the PPP project charter price adjustment model,and has carried on the empirical research,verified the validity of the model,and the ranking for the influence degree of the risk of concessionary prices:Garbage supply risk>construction risk>operation risk>calorific value risk>price rise risk>interest rate change risk>equipment damage risk;(4)a concession price adjustment mechanism for garbage incineration power generation PPP project is designed.According to the characteristics of risk factors and the principle of social capital income ceiling,the trigger mechanism of concession price adjustment for garbage incineration power generation PPP project is divided into periodic trigger,sudden risk trigger and excess profit sharing trigger.According to the difference of the applicant/initiator,the concession price adjustment procedure is designed into three types:the price increase mechanism applied by the private sector,the periodic excess profit sharing initiated by the government regulatory authorities or the third-party professional institutions,and the penalty mechanism initiated by the government regulatory authorities or the third-party professional institutions.And to influence the biggest waste supply risk as an example to verify the price adjustment mechanism,in zhejiang province quzhou city life garbage incineration power generation of the PPP project related data,adjust the garbage supply respectively 800,900,1000,1100,1200,1300,1400,1500 tons/day,using the system dynamics model to calculate the corresponding price of franchising are:175.5,146.5,123.4,104.4,88.5,73.7,59.6,45.7 yuan/ton.