Structural equation model (SEM) for evaluating interrelationships among risks inherent in Ghanaian public–private partnership (PPP) power projects
Engineering, Construction and Architectural Management
ISSN: 0969-9988
Article publication date: 27 December 2022
Issue publication date: 10 June 2024
Abstract
Purpose
The demand for power has surged in recent times and continues to increase yearly. In comparison to developed countries, the power industry’s risks, especially in piblic–private partnership (PPP) projects, are more complex and essential in developing countries. Appreciating the inter relationship among these risk factors is crucial. However, there exist no studies developing quantitative models to explain how various PPP power risk factors influence each other, especially in developing countries like Ghana. This study aims to investigate and model the relationship, the probability of occurrence and severity of impact of PPP power risk factors in Ghana.
Design/methodology/approach
Data were collected through ranking type questionnaire in a two-round Delphi survey with 48 respondents using purposive and snowball sampling techniques. partial least squares structural equation modelling (PLS-SEM) was used for analysis of data.
Findings
A model was developed to investigate the influence the risk factors inherent in PPP power projects have on each other. Validity of the model was tested based on the data collected. PLS-SEM results indicated the various relationships and interdependencies the risk factors had on each other considering their probability and severity. Both significant and insignificant levels of relationships were found among the various risk factors.
Practical implications
The SEM that was developed to assess the relationships among the risk factors has great value for policy makers in the energy sector, industry practitioners, researchers and industry practitioners. Strategies can be mapped out to mitigate and effectively allocate the risks with the high interdependencies.
Originality/value
Regarding the quantitative impact of the interrelationship among risk factors in PPP power projects, the findings of this research are arguably the first to be presented for the construction sector and contribute to knowledge on PPP practice and further has implications toward achieving power sector risk mitigation.
Keywords
Acknowledgements
This research paper is developed based on large data set obtained in a study on risk allocation modeling for public–private partnership power projects in developing countries. Other research outputs have been produced but with different objectives. Authors are grateful to respondents of study and anonymous reviewers for improving the quality of this paper.
Citation
Kukah, A.S.K., Owusu-Manu, D.-G., Badu, E. and Asamoah, E. (2024), "Structural equation model (SEM) for evaluating interrelationships among risks inherent in Ghanaian public–private partnership (PPP) power projects", Engineering, Construction and Architectural Management, Vol. 31 No. 6, pp. 2327-2352. https://doi.org/10.1108/ECAM-10-2022-0943
Publisher
:Emerald Publishing Limited
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