BOTToTo

50705070507050705070507050705070ByBy

Professor LuhProfessor LuhProfessor LuhProfessor LuhProfessor LuhProfessor LuhProfessor LuhProfessor Luh--------Maan ChangMaan ChangMaan ChangMaan ChangMaan ChangMaan ChangMaan ChangMaan Chang

Department of Civil EngineeringDepartment of Civil Engineering

National Taiwan UniversityNational Taiwan University

台灣大學土木系營建工程管理組台灣大學土木系營建工程管理組台灣大學土木系營建工程管理組台灣大學土木系營建工程管理組台灣大學土木系營建工程管理組台灣大學土木系營建工程管理組台灣大學土木系營建工程管理組台灣大學土木系營建工程管理組

December 21, 2011December 21, 2011

1966196619661966----1971 1971 1971 1971 國立成功大學土木工程學系國立成功大學土木工程學系國立成功大學土木工程學系國立成功大學土木工程學系 學士學士學士學士1974197419741974----1977 1977 1977 1977 台灣工業技術研究院台灣工業技術研究院台灣工業技術研究院台灣工業技術研究院 副工程師副工程師副工程師副工程師

1977197719771977----1980 1980 1980 1980 美國德州大學奧斯汀校區美國德州大學奧斯汀校區美國德州大學奧斯汀校區美國德州大學奧斯汀校區 營建工程與計劃管理營建工程與計劃管理營建工程與計劃管理營建工程與計劃管理 碩士碩士碩士碩士1978197819781978----1983 1983 1983 1983 美國德州大學奧斯汀校區美國德州大學奧斯汀校區美國德州大學奧斯汀校區美國德州大學奧斯汀校區 土木工程學系土木工程學系土木工程學系土木工程學系 助教助教助教助教1980198019801980----1983 1983 1983 1983 美國德州大學奧斯汀校區營建工程與計劃管理美國德州大學奧斯汀校區營建工程與計劃管理美國德州大學奧斯汀校區營建工程與計劃管理美國德州大學奧斯汀校區營建工程與計劃管理 博士博士博士博士

1983198319831983----1985 1985 1985 1985 美國佛羅里達大學建築學院建築營建系美國佛羅里達大學建築學院建築營建系美國佛羅里達大學建築學院建築營建系美國佛羅里達大學建築學院建築營建系 助理教授助理教授助理教授助理教授1986198619861986----1992 1992 1992 1992 美國普渡大學工學院土木工程暨營建工程管理系美國普渡大學工學院土木工程暨營建工程管理系美國普渡大學工學院土木工程暨營建工程管理系美國普渡大學工學院土木工程暨營建工程管理系 助理教授助理教授助理教授助理教授1992199219921992----2009 2009 2009 2009 美國普渡大學工學院土木工程暨營建工程管理系美國普渡大學工學院土木工程暨營建工程管理系美國普渡大學工學院土木工程暨營建工程管理系美國普渡大學工學院土木工程暨營建工程管理系 副教授副教授副教授副教授

1993199319931993----1994 1994 1994 1994 國立台灣大學國立台灣大學國立台灣大學國立台灣大學 土木工程學系土木工程學系土木工程學系土木工程學系 客座副教授客座副教授客座副教授客座副教授2001200120012001----2001 2001 2001 2001 國立交通大學國立交通大學國立交通大學國立交通大學 土木工程學系土木工程學系土木工程學系土木工程學系 客座副教授客座副教授客座副教授客座副教授

2006200620062006---- 國立台灣大學土木工程學系國立台灣大學土木工程學系國立台灣大學土木工程學系國立台灣大學土木工程學系 教授教授教授教授2009200920092009---- 美國普渡大學工學院土木工程學系美國普渡大學工學院土木工程學系美國普渡大學工學院土木工程學系美國普渡大學工學院土木工程學系 名譽教授名譽教授名譽教授名譽教授

Yes－－－－爺死爺死爺死爺死

Nice－－－－奶死奶死奶死奶死

Bus－－－－爸死爸死爸死爸死

Mouth－－－－媽死媽死媽死媽死

Girls－－－－哥死哥死哥死哥死

Was－－－－我死我死我死我死

Does－－－－都死都死都死都死

Cheese－－－－氣死氣死氣死氣死

Presentation OutlinePresentation Outline

�� High Speed Rail DefinitionHigh Speed Rail Definition

�� Reasons for Taiwan High Speed Rail Reasons for Taiwan High Speed Rail

�� PublicPublic--PrivatePrivate--PartneringPartnering

�� BuildBuild--OperateOperate--Transfer (BOT )Transfer (BOT )

�� BOT FinancingBOT Financing

�� Spotlights of Taiwan HSR ProjectSpotlights of Taiwan HSR Project

�� ConclusionsConclusions

Acknowledge

� Many slides are sourced from Taiwan

High Speed Rail Bureau, the book

entitled “ Case Studies of Build

Operate Transfer’’ by S.C.M. Menheere

& S.N. Pollalis, and Chinese

Engineering Consultants Inc. (CECI).

Definition of High Speed RailDefinition of High Speed Rail

�� USA : >145 km/h (90 mph)USA : >145 km/h (90 mph)

�� European : > 200 km/h (125 mph)European : > 200 km/h (125 mph)

�� Japan : > Japan : > 210 km/h (130 mph)210 km/h (130 mph)

�� China, BeijingChina, Beijing--Tianjin: 350 km/h ( 217mph)Tianjin: 350 km/h ( 217mph)

�� French TGV: 574.8km/h (359 mph)French TGV: 574.8km/h (359 mph)

�� USA: 10,325 km/h (6,416 mph) unmanned USA: 10,325 km/h (6,416 mph) unmanned

rocket sledrocket sled

Reasons for the Need of HSRReasons for the Need of HSR

�� To speed up the transportation of 185,000 To speed up the transportation of 185,000

passengers daily on the west corridor of Taiwanpassengers daily on the west corridor of Taiwan

�� To reduce the cityTo reduce the city--country (northcountry (north--south) south)

difference in Taiwandifference in Taiwan

�� To raise the living standard To raise the living standard

High Capacity/Speed & Less Land

Capacity

Car

Bus

Traditional Rail

Airplane

HSR

Speed (kmph)

High

Low

100 300 600

6.2

3.1

1.5

Car

Bus

Railway

Land Use (Square meter/Person)

Land Use

Energy Consumption vs. Travel Time (HSR=100%)

558

526 338

338

300

Energy Consumption Travel Time

Air

Car

Bus

Rail

HSR

102

70

100

63

100

600% 400 200 0 200 400 600%

.

HSR is Green Transportation

� less pollution � low energy Consumption.

Car, 66%

Car, 45%

Bus, 2%

Bus, 6%

Railway, 7%

Railway, 30%

Others, 25%

Others, 19%

0% 50% 100%

Energy Consumption

Capacity (Passenger-

km)

0

100

200

300

400

500

600

HSR 3.2 13 11.2 18

Private Car 510 131 11.5 71

Airplane 225 449 44 139

CO (mg) NOx (mg) SO (mg) CO2 (g)

One-day living circle

�� Less weather impactLess weather impact� Balanced development

FreewayHigh Speed Rail

New City Development

HSR Tracks

HSR Station

Business District

Reasons for Adopting PPP Reasons for Adopting PPP (Public(Public--PrivatePrivate--Partnering)Partnering)

��Economical AspectEconomical Aspect

��High CostHigh Cost

��Budget shortageBudget shortage

��Political AspectPolitical Aspect

��Lengthy durationLengthy duration

��Government inefficiencyGovernment inefficiency

�

(Government has to provide necessary infrastructure,

even, it is profitable in the sense of ROR)

� (Bring Private Entrepreneurship and

efficiency into government operation)

Build Operate Transfer

BOT興建興建興建興建營運營運營運營運移轉移轉移轉移轉

(Merits From Governmental View)

1. (reduce the burden of finance and administration)

2. (efficiency of private enterprise)

3. (decrease project completion time)

4. (better feasibility analysis)

5. (staff reduction of government)

6. (higher economic growth rate )

7. (risk transfer)

(Disadvantages from Governmental View)

1.(delayed or reduces Revenue)

2.(Diluted Control-monopoly Change)

3. (No Guaranty on Quality)

4. ( Favorism )

5. (Unfair Policy)

6.(if failed, government has to take over)

(Merits from Public View)

1. (reduce the tax )

2. (provide

infrastructure in a short time)

3. (more effective service)

4. (provide job opportunity)

5. (raise the profits of

the users and non-users)

(Weakness from Public View)

1. (Molopoly)

2.May not be affordable for Low-Income

3.Sell out public Concession to cover up the budget deficit

4.

If improper competition, corruption or favoritism

5.5.5.5. ,,,,Profit oriented, not human focus.

Cash Flow over the concession period

projectImplementation& construction

operation

(Financing)

(mining and energy resources project)

(no claim to sponsor’s property)(financing evaluation based on project income)

(Financing)

(mining and energy resources project)

(no claim to sponsor’s property)

(financing evaluation based on project income)

(lenders usually will limit the use of fund )

1. The borrower’s risk can be reduced

2. The funder’s cost is lower.

3. The manager is willing to afford higher risk.

4. Has better confidentiality.

5. To provide reward according personal plan and result value.

(Merit)

(The borrower’s risk can be reduced )

(less invested capital)

(The manager is willing to take higher risk )

(limited investors, more confidential)

(provide reward based on project performance)

Disadvantages

• Complexity of Risk Allocation

• Increased Lender Risk

• Higher Interest Rates & Fees

• Lender Supervision

• Lender reporting Requirements

• Increased insurance coverage

• Encourages Potential Risk Taking

• Source: The law and business of International Finance by Scott L. Hoffman

System Operating Features of Taiwan HSR Project

ItemsOperation & Service Features

Operation Speed 250~300 km/hr (156.3~187.5 mil/hr)

Operation Type Express Service/Inter-city Service

StationsTaipei, Taoyuan, Hsinchu, Miaoli, Taichung, Changhua, Yunlin, Chiayi, Tainan, Kaohsiung

Hours of Service 6:00 am ~ 12:00 midnight

Capacity per Trainset 800 seats per train set

Travel Time90 minutes for Taipei-Taichung-Kaohsiung Express Service with a 3-minute stop at Taichung

Line CapacityAbove 300,000 seats * 340 km per day (single deck train)

4.6%

39.5%

17.2%

4.1%

2.3%

16.3%3.6%

1.8%

0.2%

3.0%

3.2% 4.2%

Taipei Area Underground Rail

Civil Construction

Rail ConstructionStation

Construction

Maintenance Depot

Construction

Electricity Engineering

Ticketing Engineering

M/E Core System

Environ. Protection

Eng.

Contingency

Design & Supervision

Land Acquisition & Compensation

Cost Percentage of Taiwan HSR Project

中華高鐵集團主要成員中華高鐵集團主要成員中華高鐵集團主要成員中華高鐵集團主要成員

� 中華開發 財務� 榮工處 土木工程� Tai-Yu Products 站區開發� Walsin Lihwa 機電� 日本高速鐵路集團 營運� 日本三菱重工 系統供應商� 日本Mitsui 機電與維修� 日本熊谷組 土木工程

� Risk management� The main risks of ROT� 1. The non-resist risk

political affairsnature disaster

2. Financial riskA. What if the bank is not willing to

serve as a guarantor.B. What if the construction does not finish on

time?/What if the cost overspend?

(Risk Management)

( Main Risks

(non-resisted risk )

(political affairs )

(nature disaster )

(Financial risk )

(bank reject to be guarantor.)

(project delay/cost overspend?)

� Risk management

� The main risks of ROT

3. technique risk

What if the system is breakdown?

4. management risk

What if the plan stops because of non-

suitable management?

5. Business risk

What if there are not enough passengers?

(Risk Management)

(The main risks)

(technical risk )

(system breakdown )

(managment risk )

(project discontinue )

(business risk )

(without enough passengers )

� Non-resist reasons-nature disaster

� typhoon、rainstorm 、flood 、earthquake 、landslide 、big fire in the forest etc…

(Non-resist reasons-nature disaster)

(typhoon、rainstorm 、flood 、earthquake 、landslide 、forest fire, etc)

Non-resist reasons-political affairs

Types of risk

1. war、、、、revolutionary 、、、、civil war 、、、、rebellion

2. accident by the nucleon or biochemistry

3.

4.

5. to alternate government

(political affairs )

(Non-resist reasons-political affairs )

(Types of risk )

(war、revolution 、civil war 、riot)

(nuclear accident )

(Robbing, Stealing and Terrorist Attacking)

(China Invasion)

(changed governing party )

(politics risk)

� minification/reduce

� 1. fear without reasons

� 2. If it happens, to consult and discuss with each other

� 3. to protect exports credit institution

� 4. insurance-not the best choice

(mitigate)

(indescribable fears )(if happened,negotiate )

(protected by export credit institution)

(insurance-not the best choice )

� Finance risk

� 1. currency exchange risk

� 2. interest rate risk

� Hong Kong raises the prime rate

� 3. market risk

� raw materials

� 4. income risk

� Maxico 6000 kilometer road ?

� 5. cost overspend risk

� Chunnel， 74 hundred million ->150 hundred million

(Finance risk)

(currency exchange risk )

(interest rate risk )

(market risk )

(raw materials )

(income risk )

(cost overspent risk )(more than 4 times )

� Technique risk

� 1.building difficulty

� 2.construction delayed

� One year delayed because the signal system and the design of shuttle bus are changed.

� 3. operation risk

� The equipment is out of order or discover the imperfection when it is operating.

(Technique risk)

(difficult to construct)

(project delay)

(Euro-Channel project delay for 1 year)

(operation risk )

(equipment breakdown in operation stage)

(Solutions)

(healthy design)

(100-year life cycle)(50% )

(Solutions)

(facilities security)

(detectors for invaders)

(detect unusual environment)

(wind force)(rainfall)(vibration)

�

(non-appropriate decision process and management will still hinder the whole project)

(manage risk)

� Solution proposal of the tactic

� Establish privacy department of government invest company.

� Establish a crisis solution

� Make a strategic decision

(tactic solutions)

(government invested private corporation )

(crisis task force and coordinating committee )

(better decision making and disputes mediation )

� Business risk� Shortage of passengers� Solution� 1.better market/profit investigation� 2.better operation cost research� 3.plan to improve the image� 4.setting the price carefully and sales promotion� 5.provide a better circumstances� Good and free business policy

(business risk)

(shortage of passengers)

(strategy)

(market/profit investigation)

(operation cost research )

(improve the image )

(price and sales promotion)

(comfort)(business policy )

Independent Verification & Validation/Peer Review

Owner (Government)

Initiator/Sponsor

Bank

Concessionaire

Constructor

Operators

Users

Facility

Concessionright Part of Equity

Capital

ConstructionCost

Operation Income

Facility

User Fee

Dividend

Equity Capital

Liability Capital

Debt

IndependentAgency (IV&V)

Pay QA&QC

~領導視察基層領導視察基層領導視察基層領導視察基層~

山東省一領導到基層視察,晚飯安排在一牧民家。

領導客氣讓牧民先進門,牧民受寵說:

“還是領導前面走,俺養豬牛雞鴨的, 跟在牲口後面慣了"。

領導聽後不悅。

鄉長連忙請領導坐定,並吩咐牧民趕緊上菜,

牧民端上一盤清炒蕃薯葉放在領導面前,

久吃大魚大肉的領導, 一吃一邊大讚地說:

"真好吃! 這是什麼蔬菜?"！

牧民忙說:"這是土裡隨便拔出來的蕃薯葉賤菜, 平時俺都是拿去餵豬的 "。

領導頓時臉色下沉。

鄉長見狀連忙讓牧民一起吃飯----少說些話,

牧民卻說:

“領導先用,俺不忙,每天這個時間俺得先餵完豬後才吃飯, 都習慣了"！

鄉長氣急:"你會不會說話?“

牧民哭喪著臉:

"俺平時和畜生說話說慣了,不會和人說話..."

Taiwan High Speed Rail

Business

Standard

HSR StationsTwo major stations: co-located with Taiwan Rail system and Metro Transit systems

Six new stations: nuclei of new business district development

Maintenance Bases and DepotsThree depots

Three maintenance bases

Taiwan HSR Network

北N

NHSR route

MaintenanceBase (3)

Depot (3)

Station (11)

50 miles0

System Characteristics

SystemTotal route length: 340 km (212 miles),

Travel time: 90 minutes

Max. Design/Operation

Speed 350 kmph (218.75 mph)/300 kmph (187.50 mph)

Design Specs for civil

and architecture works

Based on European system requirements and

US AASHTO Code

The Japanese

Shinkansen Core

Systems

Including Rolling Stock, Signaling,

Electrification and Telecommunications

systems

Trackwork Standard gauge with interface among civil works,

core systems and European turnouts

HSR Project Items & Costs

Average: US$65 millions/mile

GovernmentGovernment

US$3.4BUS$3.4B

THSRCTHSRC

USUS$13.1$13.1BB

Design & BuildDesign & Build

Planning & Land Acquisition Planning & Land Acquisition

Urban Underground SectionUrban Underground Section

Supervision & MonitoringSupervision & Monitoring

Operation & MaintenanceOperation & Maintenance

Station Area DevelopmentStation Area Development

HSR HSR ProjectProject

USUS$16.5$16.5BB

Construction Budget

Financing Sources: US$13.1B

BankLoans,$9.10B

THSRCCapital,$3.90B

Others,$0.10B

Total Costs: US$13.1B

FinancialCost, $2.0B

Track, $0.7BCore

Systems,$2.8B

CivilEngineering,

$4.7B

Station,$0.6B

Other Work,$1.9BMaintenance

Base, $0.4B

Taiwan HSR Project Organization

IV&V(Independent Verification

and Validation)Banks (25

Taiwan HSR Company(BOT Contractor)

Civilwork

Station Depot

Private Investors

Design-Bid-BuildDesign-Build

Safety & Quality Functionality

Core system

Track work

EPC Turnkey

Government Authority

(Bureau of HSR)

Land Acquisition

Civil Engineering Structures

Civil Engineering StructuresTotal 345 Km

Viaduct & Bridges 252Km

Tunnel 63Km

Earthwork 30Km

To mitigate the impacts of noise and visual intrusion, the project required the use of elevated structures in open areas and tunneling in urban sections.

2001/03/152001/03/152001/03/152001/03/15

2001/8/62001/8/62001/8/62001/8/6

2001/11/202001/11/202001/11/202001/11/20

((((L=12L=12L=12L=12 ))))

Length 321m

Tunnel Construction

•Design Spec is based on the AASTHO Code of the USA

Track Works

• Standard Gauge 1,435mm• Two tracks• Mostly slab track• Design-Build Turnkey

Station Construction

9成9成9成9成底底底底成掛成掛成掛成掛底底底底掛7掛7掛7掛7

9成9成9成9成底底底底挖成挖成挖成挖成底底底底掛5掛5掛5掛5

底底底底底底底底澆澆澆澆

明掛k+5板5

掛比挖

/

明掛紮+585

明掛紮+555

HSR Hsinchu Station

Core System

Rolling StocksBusiness Class

69

L: 304 M25 M27 M

W: 3.38MH: 3.65M

Standard Class

989 seats/trainBusiness Class: 66 seatsStandard Class: 923 seats

Taiwan HSR Project milestones1990.07 Government authority Bureau of HSR established

1996.10 Government issued RFP of the HSR BOT Project

1998.07 THSRC awarded the BOT contract

2005.01 Trainset started dynamic test on the Test Line

2007.03 Revenue service started

1999.07 THSRC started construction contract solicitation

2004.06 The last civil work completed for track laying

19901990 19921992 19941994 19961996 19981998 20002000 20022002 20042004 20062006 20082008

Three Major Construction Stages

� Construction duration less than 9 years (July 1998 ~ Mar. 2007)

� The 1st 3 years -- Planning, design, urban design,

land acquisition, procurement, etc.

� The 2nd 3 years – Construction of bridges, tunnels,

earthwork, stations and depots

� The 3rd 3 years—Track works, power supply,

signaling, communication, train control system,

system testing, verification, etc.

Conclusions 1

� High Speed Rail is comparatively safe, punctual,

massive, weather-free, clean and energy saving.

� HPR sustains the economic growth

� High cost, short public fund, lengthy construction

duration, complicate bureaucratic procedures for

constructed projects faced by many governments

Conclusion 2

� Government has to maintain balance among overall social benefits, fairness of resource distribution, effectiveness of investment, and reasonable regulations in providing public infrastructure

� PPP thru BOT is an optional solution to bring in private capital & efficiency of entrepreneurship.

�

�

�

�

� 80808080 ............

� 70707070 ............

� 60606060 ............�

謝謝大家謝謝大家謝謝大家謝謝大家!

Thanks!