EP conducts a risk analysis before beginning project procurement to balance risk allocation. It evaluates the expected rate of return for the private sector. If this expected rate is too high, EP will consider adjusting the scope of work or shortening the contract term for the project. If the expected rate is too low, EP may extend the concession period or include a government subsidy. Once the project begins, EP will consider restructuring the financial conditions of the PPP agreement if the ex-ante uncertainties in the project turn out to disproportionally favor either the public or the private sector, a practice termed "rebalancing."9
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9 Portugal's risk allocation and management practices were likely borrowed from Spain, which has used these techniques for some time in its highway PPP program.