Kwok, C; Young, R J and Kirkham, R J (2010) Risk and asset management in privatization/private finance of public utiliities: A risk investigation of water infrastructure projects in China. In: Egbu, C (ed.) Proceedings of 26th Annual ARCOM Conference, 6-8 September 2010, Leeds, UK.
Abstract
The provision of public utilities, such as water, electricity or gas is usually characterized b\y an asset-intensive environment. The costs associated with operating and maintaining this are significant, and more so where infrastructures are ageing or unsupported by a pro-active maintenance and life cycle renewal strategy. A growing number of governments have sought to take these costs “off balance sheet” through privatization, on the premise that this reduces the taxpayer burden, transfers risk and creates added value for money. There continues to be a complex debate surrounding privatization, the use of private finance and commercial management of public utilities, and this falls beyond the scope of this paper. What this paper will reflect upon are the notions of risk, risk management and how it may suitably be applied within the context of public utilities procurement and management. Literature reviews are used to examine relevant risks to infrastructural projects. This paper also considers the impact of”whole-life” evaluations of asset costs and provides examples of implementation of asset management methodology PAS-55 in utility services. Taking the Chinese context, the work then moves on to describe the potential risks found in the Chinese potable water market. The paper concludes by recognizing the importance of the political landscape in China and the aggressive market growth that has characterized its economy of late. It is clear that whilst political risk is an important variable in the risk management process, the “management” of it can be exceptionally complex and fluid.
| Item Type: | Conference Paper (Paper) |
|---|---|
| Uncontrolled Keywords: | asset management; China; privatization; risk management; wastewater treatment; whole life cycle costing |
| Index terms: | infrastructural project, added value, whole life cycle, life cycle, asset management, strategy, literature review, falls, public utility, private finance, methodology, risk management, investigation, implementation, privatization, China, infrastructure project, costing, renewal |
| Subjects: | Geography, infrastructure engineering, management, renovation and retrofit, health risk and incident analysis, sustainability assessment, accounting and finance, research methods, infrastructure and transport systems, asset management, value management, risk assessment, data collection methods, data analysis and analytics, contractual arrangements, economic analysis |
| Topics: | Urban Studies, Engineering Principles, Research Practice, Geographical Context, Project Management, Health and Safety, Business Strategy, Cost Management, Sustainability, Procurement, Risk Management |
| Descriptive scope: | 4 PCTA |
N.B. Descriptive scope is a count of how many of the five facets of empirical research are indicated by the words used in title, abstract and keywords. It is not intended as a judgement on the research; merely a count of the kind of word we would expect to indicate Phenomenon, Concepts, Theoretical framing, Empirical techniques, Analytical techniques. If all five are present, then a code of “5 PCTEA” will indicate this. If you feel the coding for this record is questionable, we welcome discussion around the terms we matched or the way we categorized them. The facet you would expect may not be coded, or a facet may be coded inappropriately. This can also bear on a larger question, of which facets should be treated as defining in construction management research. Please get in touch, and we will look at it. More details here