The VFM table described in detail in Section 10 is shown below as the consolidated representation of the results of the quantitative procurement options analysis for this example.
The VFM table compares the two procurement approaches based on the payment streams described above. When the cash flow streams for the two models are discounted to their NPC, the heavier, up-front and lower annual costs of the PSC can be compared to the more even ASP stream from the Shadow Bid.
The result of this comparison demonstrates that the NPC of the ASP stream is approximately $65 million dollars less than the NPC of the PSC. The Shadow Bid therefore provides quantitative value on a risk-adjusted basis of approximately $65 million, or roughly nine per cent of the risk adjusted capital costs of the PSC.
Figure 4: Value for Money Table
| Value for Money Analysis 30 year OMR | |||||
| Traditional |
|
| PPP (Shadow (Bid) |
|
|
| Captital Costs | $ | 463 |
|
|
|
| OMR Costs | $ | 95 |
|
|
|
| Cost | $ | 559 | Availability Payment | $ | 633 |
| Risks Retained under Traditional Delivery that would be transferred under PPP | |||||
| Risk adjustment to Capital Cost | $ | 68 |
|
|
|
| Total Risk Adjustment | $ | 68 |
|
|
|
| Tax and Insurance Adjustment Insurance Provincial Tax |
$ $ |
38 10 | Tax and Insurance Adjustment Insurance Income Taxes |
|
|
| Total Adjustment | $ | 48 | Total Adjustment |
|
|
| Retained Costs Project Management |
$ $ |
59 30 | Retained Costs Project Management |
$ $ |
48 17 |
| Total Retained Costs | $ | 89 | Total Retained Costs | $ | 65 |
|
| |||||
| $ | 763 | Adjusted Shadow Bid | $ | 698 | |
| % of PSC Costs including risk |
|
|
|
$ |
65 8.6% |