Alternative Capital Financing
Treasury Board is committed to pursuing new ways to undertake capital projects. Although Alberta spends three times the average of other provinces on capital construction, the province’s current Capital Plan does not accommodate all of the projected demand that is arising from rapid economic and population growth.
Treasury Board will explore with stakeholders opportunities to pursue alternative approaches to building and financing capital projects, such as public-private partnerships (P3) or working in partnership with municipalities, wherever it is cost-effective and feasible. Alternative arrangements may not be the best fit for all capital projects. They would only be considered where it makes sense from the taxpayers’ perspective.
A public-private partnership arrangement enables government to share the expense and risk of development with the private sector. It also ensures cost certainty for government since it is delivered at a fixed cost. This is particularly valuable at a time when construction costs are escalating up to 25 per cent per year.
P3 agreements also allow the province to spread the cost of a project out over a longer period of time by accessing private capital and paying for an asset as it is consumed, rather than expensing the asset when it is constructed, which is the current practice. This would enable government to address a greater number of infrastructure pressures sooner and accelerate the building of roads, hospitals, schools and other public facilities.
View the list of Alberta's P3 projects
