Build-own-operate
Also called: BOO · Topic: Infrastructure: Transport, Communications and Energy · NCERT: Beyond NCERT
Meaning
Build-own-operate (BOO) is a public-private partnership (PPP) model in which the private party builds an asset, owns it and runs it indefinitely. There is no obligation to transfer it to the government. The private party bears the long-term risks of ownership and recovers its money through sales or user charges. The government mainly sets rules and may sign supply contracts.
Example
A private company builds a power plant, owns it and runs it permanently. It sells the electricity to a state discom under a power purchase agreement. The plant never passes to the government.
Don't confuse with
- Build-own-operate-transfer (BOOT): the private party owns the asset only for the concession period, then must hand it to the government. In BOO the asset is never handed over.
Related concepts
- Public-private partnership
- Concession agreement
- Engineering, procurement and construction
- Hybrid annuity model
- BOT-Annuity
- Annuity model
- BOT-Toll
- Build-operate-transfer
- Build-own-operate-transfer
- Build-own-lease-transfer