PPP and Project Financing

• The allocation of risks and investments to the private sector allows the PA to manage the project off the balance sheet.
• Any capital that the PA has available can be included in the project as a public contribution (max. 49%), in order to reduce the use of private capital to support the design and implementation of the interventions.
• Proposals may include full-risk coverage on all the works implemented. By way of example, the following risks are allocated to the private contractor
  • the availability of services offered and facilities implemented
  • delays in implementation and intervention
  • failure to meet energy saving targets.
• The useful life of interventions goes beyond the duration of the project (especially for interventions concerning the building component) and leaves the PA with a highly upgraded building stock.
• The PA simplifies its control and management activities by having a single point of contact responsible for the coordination and efficiency of the service, and a single person responsible for clearly defined, measurable and constantly reported objectives.
• The PA has the opportunity to participate at the various design stages of the intervention, in order to adapt it to the needs of the various internal stakeholders.
• The private operator is encouraged to carry out interventions and maintenance as quickly as possible, as he benefits directly from the energy savings.
• The quality of the design, implementation and management of the services is very high, as it is the private operator who bears the costs of providing the carriers and therefore benefits from the energy savings.

Project financing is used for implementing large investment projects. In the case of public administration, project financing can be used for implementing of public investment projects, such as hospitals, schools or roads – either new or the renovation or refurbishment of existing buildings.
In general, it is achieved through an agreement between the public administration and a private party, which undertakes to implement the project in exchange for a series of economic and financial benefits.

Project financing is an attractive solution for public administration, as it allows large investment projects to be implemented without having to resort to direct public funding, which may be more difficult to obtain. In addition, it allows the risks associated with implementing the project, and its timing, to be transferred from the PA to the private entity implementing it, thereby reducing the financial risk for the public administration.

PPP involves a long-term collaboration between the public and private sectors with the aim of implementing a project or providing a high-quality public service in an efficient and cost-effective manner. It is precisely because of this long-standing relationship that it is essential to rely on a partner capable of dealing with every stage of the project.

Gemmo has a proven track record in project finance and works concessions and services, having arranged and subsequently managed in PPPs for complex projects since 2002. It has the technology and human resources to be able to carry out each activity independently and adapt to the customer’s needs at all stages of the work: conception, design and implementation, maintenance and energy efficiency improvement.