Uncertainties, and the associated risks to project value, are compounded by climate change (and other factors). In response, some governments are turning to public-private partnerships in an effort to access additional capital and expertise for major undertakings. While these partnerships can often bring value for money, they also come with complications.
In order to adequately evaluate and prioritize project investments, one decision-making method from the finance community is particularly helpful in representing the full value of climate-threatened projects. A real options framework can identify value and preserve it for public entities.
We’ll look at how the framework can be applied as a strategic approach to infrastructure development.
Dr. Richard Swanson (GLS Group) is a strategy consultant, focusing on energy sector assets and project development. He helps his clients prioritize their infrastructure investments, and with project design. His clients include private developers, multilateral agencies, and infrastructure investment banks. He has degrees from the Fletcher School (’08), and the University of Colorado (’88 and ’17), and he lives near Boston, MA.