The development and assessment of PSC and Shadow Bid models is an essential part of a project business case. Each model is constructed to address the unique circumstances of a particular project along with the potential impacts of the different procurement approaches.
The financial model assumptions presented here are based at a high level on a transportation project, and have been selected to give sufficient detail to provide an understanding of the key elements of the financial modelling process.
The following sections explain in further detail how the PSC and Shadow Bid models are structured, based on following major elements:
● Key dates,
● Inflation assumptions,
● Capital structure,
● Tax and accounting assumptions,
● Financing assumptions,
● Capital costs,
● Costs at financial close and OMR assumptions, and
● Availability payments.