Profit Distribution Of Benefit Guaranteed Water Saving Management Contract Project

The vast territory,complex terrain and significant continental monsoon climate lead to the uneven distribution of water resources and frequent drought in some areas.The shortage of water resources is becoming more and more serious,which has seriously affected China’s economic and social development."Water saving priority,spatial balance,systematic governance and two hands" have become important measures of water control policy in the new era.Contract Saving Water Management(WSMC)is an effective way for water-saving service company(WSCO)and water-saving users to agree on water-saving objectives in the form of contract and carry out water-saving transformation.However,the imperfect income distribution mechanism restricts the development of WSMC.Under the benefit guarantee mode,water-saving users are responsible for financing,bear the main risks of the project and have the ownership of income distribution.Based on the hierarchical sharing model,from the perspective of water-saving users,this paper analyzes the enthusiasm of WSCO’s hard work and decides the distribution proportion of both sides when paying WSCO’s fixed management fee and WSCO’s participation in excess profit distribution.Firstly,the effort level and knowledge input efficiency coefficient of WSCO are selected as the influencing factors to establish the respective income models of water-saving users and WSCO.Secondly,according to the changes of the above factors,the income of both parties in the two cases is analyzed.Finally,an example is given to verify the effectiveness of the model.The results show that:(1)WSCO has higher enthusiasm to work hard when participating in excess profit distribution than when only obtaining fixed management expenses.(2)The higher the effort level of WSCO,the greater the profit sharing proportion.At the same time,the profits of both parties will increase with the improvement of WSCO’s work effort.Based on the collar option model,this paper solves the income distribution ratio of both sides under the benefit guaranteed WSMC model.Firstly,a collar option model is proposed to calculate the profit distribution ratio between WSCO and water-saving users.The model makes the guarantee value provided by WSCO to water-saving users equal to the profit value provided by water-saving users to WSCO.Secondly,the binomial option model is used to price the option,determine the value of put option and call option,and then use the collar option to solve the profit distribution proportion.Finally,an example is given to verify the effectiveness of the model.The results show that the distribution scheme can not only fairly determine the profits of the participants,but also encourage WSCO to work hard to obtain the profit right.This paper considers the income distribution problem under the benefit guaranteed WSMC model for the first time,and applies the hierarchical sharing model and collar option model to the benefit distribution of the model for the first time.The research of the two methods solves the previous decision-making of the profit distribution proportion of WSCO based on experience,provides a scientific decision-making basis for both parties,and promotes the WSMC project to expand the market.At the same time,this paper supplements the income distribution method to provide a reference for the income distribution of benefit guaranteed WSMC.