Alternative ways of financing infrastructure investment: potential for ‘novel' financing models

This section of the report examines the issue of financing (transportation) infrastructure investment projects. It looks closely at what market failures result in the private sector not being able to cover the investment requirement itself. It then assesses the government failures associated with intervention, and identifies what public–private partnerships (PPPs) offer in overcoming these failures. The limitations of PPPs are then addressed, and the regulated asset base (RAB) model is introduced as a potential alternative, with an assessment of its advantages and disadvantages.