Q15. Should the PSC include the value of the pre-existing assets required to provide the service? How should these assets be valued?

The value of all pre-existing assets should be included in the PSC. Virtually all preexisting assets will have an alternative use to government and/or a market value which is the basis for estimating the opportunity cost. Very occasionally, there is no alternative use, so that the opportunity cost is zero and the assets represent sunk costs.