Conference Interactive Program
To view the 2013 Annual Meeting Interactive Program
TRB 91st Annual Meeting (January 22-26, 2012)
Transportation Revenue and Finance Showcase
Jan 23 2012 2:00PM- 3:45PM
Hilton, International Center
Payment-based Annual Revenue Guarantee versus Period-extension-based Cumulative Revenue Guarantee in Build-Operation-Transfer Projects (12-0380)
This study proposes a method to compare revenue guarantee programs in a build-operation-transfer project. Two types of revenue guarantee programs are formulated: a payment-based annual revenue guarantee program and a period-extension-based cumulative revenue guarantee program. Monte Carlo simulation is used to model the real option approach. This method is applied to a toll road project in the Philippines wherein the expected payoffs of the government and the concessionaire are simulated over an evaluation period that includes the concession period. The condition under which the expected government return in one program is equal to that in the other program is shown. These programs are then evaluated by incorporating a project risk factor into the project return. The results show that for the analyzed project the cumulative revenue guarantee program is preferred to the annual revenue guarantee program. However, the optimal solution depends on the governmentfs return-risk preference.
Asao, Kohei , University of Tokyo, Japan
Miyamoto, Takashi , University of Tokyo, Japan
Kato, Hironori , University of Tokyo, Japan
Diaz, Crispin Emmanuel Damaso, University of the Philippines
Transportation Research Board. 500 Fifth St. NW, Washington, D.C. 20001
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