Public private partnership

The essence of public-private partnership:

The objects of public-private partnership are objects that are in state or communal ownership.

According to the Law, the objects of public-private partnership can be:
  • Existing, in particular, reproduced (by reconstruction, modernization, technical re-equipment) objects that are in state or communal ownership, including subsoil areas;
  • built or purchased objects as a result of performed contract entered within the framework of the public-private partnership.
The main features of the PPP mechanism, which determine its effectiveness in attracting private business
  • Granting the right of management (use, exploitation) to the object of partnership or purchase, creation (construction, reconstruction, modernization) of the public-private partnership object with the subsequent management (use, exploitation), subject to the acceptance and execution by the private partner of the investment obligation.
  • Fixation in contractual relations of “public interest”.
  • Long-term relationships (from 5 to 50 years).
  • Transfer of risks to private partners in the process of public-private partnership.
  • Making a private partner investment in partnership objects from sources not prohibited by law.

The state of implementation of PPP objects on the territory of the Kherson region

An investment project in the field of production, distribution and supply of electric energy “Development and improvement of the efficiency of the Sivash wind power plant” is implemented on the basis of public-private partnership on the territory of the Kherson region.

The concession agreement concluded on December 29, 2006 between Kherson Regional State Administration and the private partner – Limited Liability Company “Syvashenergoprom” in Chaplinka district for a term of 49 years.

The concessionaire LLC “Syvashenergoprom”, during the period of implementation of the above-mentioned investment project, achieved the following results:

– three stages of the Sivash wind power plant with total capacity of 2.92 MW were put into operation and generated wind energy in the total volume of more than     14 050 kW/h;

– a license issued by the National Commission for the State Regulation of Energy and Utilities (B series No. 036345 dated July 12, 2012) as an energy source using alternative energy sources, as well as the “green tariff” for the sale of electric energy;

– membership in the Wholesale Electricity Market of Ukraine was acquired;

– repair and adjustment works were carried out in order to ensure uninterrupted operation of the Sivash wind power plant, namely: at the wind turbine with the part of the transmission was replaced. The generator on the wind turbine T600-48 No. 1 was purchased and replaced, the new electronic equipment was installed, the access road was restored, and the testing and maintenance of the corresponding electrical equipment was carried out.

In addition, at present, Sivashenergoprom LLC has entered into an agreement with the National Energy Company “Ukrenergo”. Regarding the connection of the Sivash wind power plant to the 250 MW power network and received a positive expert report for the project documentation “Feasibility study on the construction of the Sivash wind power plant of 250 MW in the Chaplinka district of the Kherson region”.

The work on the organization of the process of concession of the state enterprise “Kherson Sea Commercial Port” as a state property object is continuing in order to increase the efficiency of the use of state property and significantly improve the organization of its management.

The international airport Kherson has prepared an investment package aimed at the complete reconstruction of the airport, in particular the installation of a light signal system and repair of the waiting room by creating the preconditions for the possibility of introducing a mechanism of public-private partnership, in particular, under concession conditions.

In order to attract additional revenues from investment resources to ensure the development of the infrastructure of the region the Kherson regional state administration is also considering specific proposals for potential investors on the possibility of introducing in 2018 projects in the field of construction of waste processing plants with the use of the mechanism of public-private partnership.

Below are shown links to international Internet resources where you can obtain information and download documents (manuals, reviews, reports, etc.) related to the development of feasibility studies, project preparation, funding arrangements, training,PPP issues etc. 

  1. UNECE International PPP Centre of Excellence– established for the following purposes: identification of the best global PPP practices, assisting governments in the successful implementation of best practices, ensuring the exchange of PPP experience between experienced countries and those in which processes PPPs are just starting out.

  1. European PPP Expertise Centreis a joint initiative of the European Investment Bank, the European Commission and Member States and candidate countries to strengthen the public sector’s capacity to implement PPPs.

  1. The National Council For PublicPrivate Partnershipsis a federal platform established in 1985 to provide comprehensive support and development of PPPs.

  1. PPP in Infrastructure Resource Center– created by the World Bank initiative to provide easy access to a wide range of legal material that can help in planning, designing and legal structuring of any infrastructure project.

  1. The European Bank for Reconstruction and Development (EBRD) has launched a PPP initiative to track and support PPP development processes in European countries. List of all projects, including and PPP-funded EBRD.

  1. International Project Finance Association (IPFA)was established in 1998 to facilitate dialogue between government partners from different countries and business representatives – potential private partners, providing advisory support, training and organizing international PPP promotion activities.

  1. United Nations Industrial Development Organization (UNIDO) – aims to support the development of industry in the world, including through PPP.
  2. European PPP Forum created on the basis of the European Institute of Public Administration (EIPA) with the aim of raising the level of skills of government officials and institutions.

  1. The International Finance Corporation (IFC) assists governments in preparing PPP projects