Usually, PPP modes such as Management Contracts, Lease Contracts, Concessions, BOT and its variants are commonly adopted for the development of projects across sectors. More on various PPP models are set out in Module 2 of the PPP Guide for Practitioners.

The main differences between the various PPP structures concern the allocation of risks, including the following:

1. The investment risk, e.g. who will invest in the project and contribute towards the capital and operation and maintenance costs; whether it is the public entity or the private partner or jointly

2. The residual asset risk, e.g. who will be the owner of the asset and ensures directly or via contract that the residual value at the end of the contract is as estimated

3. The construction risk, i.e. who is responsible for designing and building an asset on time and within budget

4. The demand risk i.e. who is responsible for the use of the asset and who will be hurt if demand is less than expected

5. The revenue risk, e.g. who is responsible for ensuring that optimum levels of revenues are earned by the project; this could be a derivative of risk associated with demand for the project, collection of revenue and revenues losses/ leakage. It becomes all the more critical to the public entity where the bid parameter for selection of the private partner is the highest revenue share

6. The performance risk i.e. who is responsible that the asset is available for use in accordance with performance standards