An Investigation to the Concession Period Length Determination of BOT Project

The length of the concession period of Build-Operate-Transfer (BOT) projects directly affects the investors and the concerned governments interests, such as the financial returns and the related risks. A focus on the concession period determination leads to an overview of recent advances as well as the mathematical models. This research highlights some strengths and weaknesses of the approaches applied by previous researchers, together with the variables affecting the concession period. These factors are clustered into NPV-related, Risk-related, and CSFs (critical success factors)-related variables. Then a Monte Carlo-based simulation model is proposed. Finally, the potential of setting up a Decision Support System is discussed. The final decision support system integrates the traffic flow prediction model and the toll fee adjustment system. It is expected to assist the decision making process of concession period determination in BOT projects.