This study explores risk allocation in public-private partnerships for geothermal energy projects in Indonesia. We … develop an evidence-based framework founded on principal-agency theorising that suggests an optimal allocation of risk between … the parties in these arrangements. A Delphi survey suggested the risk bearing levels for the Indonesian government range …

We describe a simple robust technique for incorporating any type of views on expected returns into the Risk parity … remain at risk parity. Second, agnostic (cautious) views always result in a more diversified allocation. We further extend … this framework to arbitrary initial risk budgets, and suggest an alternative to the Black-Litterman methodology …