Financial Sustainability Of The Waste Treatment
Projects That Follow PPP Contracts In Greece:
A Formula For The Calculation Of The Profit Rate
Author(s)
A. Sotirchos, A. C. Karmperis, K. Aravossis & I. Tatsiopoulos
Abstract
This paper examines the initial budget estimation process for the implementation
of waste treatment projects through Public-Private Partnership (PPPs) in Greece.
The study, having as strong theoretical foundation the project’s financial analysis
that is included in the cost benefit analysis methodology, evaluates the financial
sustainability of a waste management project. Initially, the budget estimation
process that is currently used under the conventional procurement of public
projects in Greece is followed and the results demonstrate that the specific
process, where the investor’s Profit Rate (PR) takes specific values, cannot be
used in the case of a PPP. Furthermore, a new formula is developed, which
calculates the minimum value of the private sector’s PR, in order to determine
the existence of positive cash flows during the operational phase of the project
and to ensure the partnership’s financial sustainability. The new formula can be a
useful tool to the public decision-makers in Greece, because it helps them to
evaluate the financial sustainability of the waste treatment projects that follow
PPP contracts, during the conceptual phase.
Keywords: cost benefit analysis, financial analysis, financial sustainability,
profit rate, Public Private Partnerships, waste treatment projects.
Keywords
cost benefit analysis, financial analysis, financial sustainability,
profit rate, Public Private Partnerships, waste treatment projects
Related Book
Other papers in this volume
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