A higher education public-private partnership (P3) is a type of agreement where a college or university and a private sector partner share resources, risks, and incentives related to the development, operation, and/or maintenance of campus facilities. The National Council of Public-Private Partnerships identifies 18 distinct legal and financial P3 structures, but each P3 agreement is unique to its partnership or deal.
A P3 is not a silver bullet or a short-term engagement. P3s are complex, long-term commitments that are often compared to marriages. They offer an alternative method for schools to finance projects, leverage their assets, transfer risk, and ensure operational success.
- Allows a campus to use their utility system as a financial asset
- Can accelerate system transformation using best-in-class professionals and private funding sources
- Can provide financial stability and predictability for the campus energy infrastructure
- Requires a significant amount of due diligence to reach a long-term agreement
- Requires ongoing management of a complex business arrangement
P3s can enable the suite of projects needed to achieve systemic change required to drop emissions campus-wide emissions by as much as 50-90%.
Large Net SavingsMore Info
P3s may add a small premium to the cost of capital, but can still improve financial performance by speeding up implementation, reaching economies-of-scale, lowering implementation risks and transferring operational risks to third-parties.
A Big LiftMore Info
P3s require a team with financial, technical, legal and operational expertise. Contracts can be difficult to negotiate, but can also provide robust planning and due diligence to make things much easier in the long-term.
2-5 yearsMore Info
Going from idea to a final transaction can take months to years depending on the scale and duration of projects within the P3. There are P3s that can be executed quickly. Transformational change can take some time.
Many P3 projects are designed to transfer maintenance to a third-party, but the campus will still need to oversee the performance of the P3 and interact with the other partners.
Large-scale projects can be more than the “talk of the town” they can be the talk of multiple industries and stakeholder groups.