In theory, it might be possible to conceive a contract with performance penalties and bonuses that provide equivalent incentives to those of private financing. In practice, there are several problems with this. For example, the financial impact of a delivery delay measured in additional interest costs on a loan to a P3 consortium is several orders of magnitude higher than the kinds of penalties for delays found in conventional contracts. For example, a $50,000 interest charge for an extra day of carrying a $250-million loan is not unusual. Although it is possible to introduce penalties of an equivalent order of magnitude, it may be much more difficult to enforce these penalties in practice-that is, without litigation regarding the sources and responsibilities for the delays.
This suggests that it may not be possible to devise contracts for large infrastructure projects in which the private partners have the same powerful incentives as they do in P3 contracts. However, observers should monitor the results of large-scale design-build projects that are being procured without private financing-such as the Port Mann/Highway 1 project in British Columbia. These types of projects may prove to be interesting natural experiments in "DBFMs without the F," since both are being undertaken in jurisdictions with extensive P3 procurement experience.