The build–operate–transfer (BOT) scheme is widely applied to finance new infrastructure projects with private sector (concessionaire) participation. For a predetermined concession period (CP), assuming that CP consists of the construction duration (CD) and the concession operation period (OP), different construction durations result in different profits for the concessionaire. Meanwhile, according to the time–cost trade-off (TCT) principle, shortening the CD increases the construction cost; shortening the CD also prolongs the OP, which could increase the total benefit of BOT projects. Hence, how to arrange construction reasonably to maximize the whole profit is a key issue for a concessionary. This paper proposes a methodological framework including optimization, sensitivity analysis, and improved (incentive) genetic algorithms (GA) for BOT projects. Through the proposed methodological framework, the reasonable construction duration of a BOT project can be obtained. A numerical example is used to verify the proposed methodology.
A hybrid genetic algorithm for the discrete time–cost trade-off problem