Dutch PPP

Dutch PPP Dealflow 2012-2020

London, 5th Global Leadership Infrastructure Forum Danny Zwerk PPP Unit, The Netherlands

Overview

•  Rijkswaterstaat •  Dutch Government PPP Policy •  PPP-dealflow in general •  Upcoming tenders •  Key features of Dutch PPP’s

–  Risks allocation –  Legal framework –  Competitive dialogue –  Payment mechanism

3 February 2012

Rijkswaterstaat

•  Rijkswaterstaat (1798) is the executive agency of the Ministry of Infrastructure and Environment

•  Rijkswaterstaat works to ensure that the Dutch have: •  dry feet •  sufficient clean water •  a smooth and safe flow of transport on nation’s roads and waterways •  reliable and useful information

•  Round 9.000 Employees •  Annual budget: € 4 to 5 billion

PPP Policy

•  Multi Annual Investment Programme 2012-2028 –  Budget approved by Parliament up until 2023 –  Cost Benefit Analysis –  Environmental Impact Analysis –  Ceiling Price including maintenance and interest

•  First allocate budgets to attractive projects then determine the best contract type for each project.

•  Current government: PPP/DBFM unless… Comply or Explain •  Dealflow 2-3 projects each year •  Support local government •  Attract institutional investors

3 February 2012

Potential PPP Dealflow

•  32 Indicated PPP’s in the Multi Annual Programme •  Total ca € 20 bln (CAPEX)

•  2 Rail Projects (under investigation) •  10 Projects in Maritime Infrastructure •  20 Projects in Road Infrastructure

•  Some greenfield •  Mostly new highway, next to existing highway

New highway next to existing highway…

3 February 2012

Dutch PPP’s 5 tendered 2 tendering >20 upcoming (2-3 each year)

The SAA-corridor: € 4½ bln (5 contracts)

SAA: Estimated time schedule and budgets

A10-East/A1 A1/A6 A9 Gaasperdammerweg A9 Amstelveen A6 Almere

9

2011 2014 2012 2013 2015 2017 2016 2018

2020 2019 2021

Realisation

Exploitation

Tender Legenda

5,0%

40,0%

22,5%

22,5%

10,0%

BUDGET

A10 Amsterdam ZuidAs

The Amsterdam Sealock (1)

The Amsterdam Sealock (2)

The Afsluitdijk: improve safety and renovate locks

Risk Allocation

•  Client Risks (Full compensation) –  Force majeur event –  Compensation event (change of law)

•  Shared Risks (only compensation for delay) –  Delay events

•  Contractors Risks (All on contractors expense) –  All but… supervening events

15

Remaining with the client

Incidentmanagement Winter maintenance Traffic Management

16

What happened?…… And what happens next?

17

Force Majeure or contractors risk?

Legal framework

•  Procurement Directive 2004/18/EG •  Dutch contract law •  Decree Procurement rules for Public Contracts

Dutch abbreviation: BAO •  Guidelines for procurement of public works

Dutch abbreviation: ARW 2005

Challenges

•  Improve Contractmanagement •  Capacity Building within the Government •  Attract Institutional Investors •  Support Local Governments

Concluding remarks

•  Long term stability •  Strong political commitment •  Substantial dealflow •  Solid projects •  Standard contracts and procedures •  Looking for partnership and foreign involvement

Thank you very much! www.ppsbijhetrijk.nl

PPP features

•  DBFM with availability payments •  Ceiling Price for bidders including maintenance and interest •  Standard contracts and standardized risk allocation •  Standard tender documents and standard procedures •  Competitive dialogue

DBFM-payment mechanism

•  Payments on availability (after completion) –  Penalties in case infrastructure is

not available –  Penalties in case quality is

insufficient •  Bullet-payment on realisation •  Ceiling price during tender

procedure

Bullet payment on realisation

Availability payment

Partial availability payment

Payment mechanism

Tender Schedule Dialogue

phaseSelection phase Best and Final Offer1st dialogue rounds 2nd dialogue rounds 3rd dialogue rounds

Aw

ard

[nr] Candidatesn Candidates

1 C

an

did

ate

Plan of ApproachRequest to participate Final Tender

An

no

un

cem

en

t

[nr] Candidates

Award phase

Contract Close Financial Close

Co

ntr

act

Clo

se

Fin

an

cial

Clo

se

3 months

3 months 3 months 6-9 months

3 months

3 months 3 months

Award criteria

Award criteria

Selection criteria