English
РусскийPPPs and environmental conflicts
One of the least examined aspects of PPP motorway projects is how the PPP model influences the resolution of environmental conflicts. In theory, it should not influence it at all.
If transport planning and project planning are carried out transparently and inclusively, the results should enjoy a wide public consensus which would not cause any particular problems when bound into a long-term concession contract.
However in real life transport projects often cause considerable conflicts, even after the relevant legal decisions are taken to construct them.
When the project is carried out through public procurement, the government usually has to bear some extra costs in case the project is delayed while it resolves the environmental issues related to the route.
However in PPPs this is taken to a whole new level.
The Moscow-St. Petersburg motorway and the D1 Phase 1 motorway are both good examples of reluctance to delay the project for environmental reasons - in the case of the D1 resulting in the collapse of the PPP altogether.
Read more in our case studies on Moscow-St. Petersburg and the D1 Phase 1.
The PPP contract states that this project will start on X date and will be constructed on Y route and that the concessionaire will be awarded Z amount of money in case the start of the project is delayed.
This means that the authorities are even more reluctant than usual to delay a project or to make changes to it because of the likelihood of having to pay penalties to the concessionaire for changing the contract and delaying the start of the implementation.
Brought to you by
For updates on international development finance
