The Third File shall include a quantitative analysis which shall:
a) develop project cost and income estimates and use these as inputs to construct a PSC financial model, projecting them as if performed as a traditional public procurement.
b) develop a parallel set (on a comparable basis) of financial projections and a financial model for the selected Privatization option.
c) calculate net present values (NPVs) for the two sets of financial projections.
d) compare the two NPVs to arrive at a quantitative assessment of VFM.
The Work Team shall follow these steps to: construct a PSC financial model; construct a financial model for the Privatization option; and to undertake the VFM analysis. A suggested template for the financial model output, especially with respect to the cost breakdown required as a minimum, is provided at Table 3 below for the PSC and Table 4 for the Privatization Option (See Templates at the end of this section).