Risk Matrix

The following table illustrates the format for a typical risk matrix. The risks listed are typical of public private partnerships, but will vary considerably amongst individual projects.



Allocation under PPP

Description of risk

Costed as part of PSC?

Retained risk

Shared risk

Private sector

1. Demand and revenue risks

- (Type of) service demanded



- Asset usage



- Capability of assets



- Assets



- Mismatch between performance incentives and customer disbenefits



2. Operating risks (including maintenance)

- Cost of operations



- New regulations



- Fire



- Theft



- Accidental damage



- Vandalism (to the extent not covered by insurance)



- Health and safety costs



- Breach of environmental regulations



- Training costs



- Exchange rates



- Defects that require repair to maintain performance



- Integration of new assets into the system



- Obligation to repair damage



3. Design and construction risk

- Site availability



- Commissioning and systems integration



- Site costs



- Inadequate design



- Design errors



- Late design changes



- Design delays



- Site access problems



- Unforeseen ground conditions



- Environment



- Archaeological discoveries



- Weather



- Strikes



- Interference from third parties



- Interactions with utilities and statutory authorities



- Noise restrictions



- Delays with procurement of materials



- Availability of plant



- Unproven technology



- Unforeseen incompatibility with existing systems and services



- Delays with approvals



- Insolvency of subcontractors or suppliers



- Commissioning difficulties



- Contractual claims



- Abandonment of contract



- Corruption



- Construction defects



- Third-party liability



- Fire



- Flood

-



- Health and safety








4. Other risks

- Availability and cost of finance



- Taxation



- Legislation



- Inflation