Capacity-building on Climate Finance

Building Knowledge and Capacity for Climate Change Finance and Investment

26th January 2017, Kathmandu, Nepal

Session Four

International Climate Funds

Toolkits

• Climate Finance Inventory – covers 99 funds (http://www.oecd.org/environment/cc/database-climate-fund-inventory.htm)

• UNFCCC Funding for Adaptation Interface (http://unfccc.int/adaptation/workstreams/implementing_adaptation/items/4638.php)

• GEF Country Support Programme (CSP) Toolkit -- to strategically access GEF (https://www.thegef.org/gef/pubs/country-support-programme-toolkit)

• OECD Toolkit to enhance access to adaptation finance (http://www.oecd.org/env/cc/Toolkit-to-Enhance-Access-to-Adaptation-Finance.pdf, annex 3)

• PIFS/SPREP Guide to key funding sources for climate change/DRR (September 2015)

CLIMATE INVESTMENT FUNDS (CIF)

Pilot Program for Climate Resilience

Purpose: The Pilot Program for Climate Resilience (PPCR) is a targeted program of the Strategic Climate Fund (SCF), which is one of two funds within the Climate Investment Funds (CIF) framework.

Priorities:. The PPCR aims to pilot and demonstrate ways in which climate risk and resilience may be integrated into core development planning and implementation by providing incentives for scaled-up action and initiating transformational change.

Giving priority to highly vulnerable least developed countries, including small island developing states*, the PPCR provides grants and highly concessional financing (near-zero interest credits with a grant element of 75%) for investments supporting a wide range of activities, such as: water resource management, urban development, infrastructure, coastal zone management, climate information systems, disaster risk management & agriculture

PPCR Eligibility: Countries require ODA eligibility (according to OECD/DAC guidelines),

the existence of an active multilateral development back country programs, priority will be give to highly vulnerable LDC’s eligible for MDB concessional funds including SIDS

Accessing funds: The $1.2 billion Pilot Program for Climate Resilience (PPCR), is a funding window of the CIF. Using a two-phase, programmatic approach, the PPCR assists national governments in integrating climate resilience into development planning across sectors and stakeholder groups. Second, it provides additional funding to put the plan into action and pilot innovative public and private sector solutions to pressing climate-related risks.

Grant Size: Unspecified

Instruments:

Co-financing

Concessional Loans

Grants

Project: Bangladesh

Coastal Climate Resilient Infrastructure Project Objective: This project, undertaken as a partnership between the Government

of Bangladesh, ADB, and CIF, will receive $30 million in PPCR funding and will be completed in December 2018. The primary objective of the project is to reduce poverty and raise incomes in the rural coastal districts of Bangladesh through fostering rural connectivity in a sustainable and “climate-proof” way. The project will enhance access to various social services across 12 rural coastal districts, resulting in better health, education and economic opportunities for local residents. Through improvement to all-weather markets, the rural poor, and particularly women, will be given the opportunity for a better lifestyle and increased earnings.

Country: Bangladesh Region: Asia & Pacific MDB:ADB Thematic Focus: Infrastructure CIF Funding ($US M): 30 Expected Co-Financing ($US M): 120 CIF Fund: Pilot Program for Climate Resilience TFC/SC Approval Date: September 2012 MDB Approval Date: September 2012 Sector Type: Public Project ID: XPCRBD004A

Forest Investment Program

Purpose: $775 million Forest Investment Program (FIP) provides indispensable direct investments to benefit forests, development and the climate. FIP grants and low-interest loans, channeled through partner multilateral development banks (MDBs), are empowering countries to address the drivers of deforestation and forest degradation both inside and outside of the forest sector to achieve the triple win of being good for forests, good for development and good for the climate. Support developing countries’ REDD efforts and promote sustainable forest management through four main objectives: Initiate and facilitate transformational change in developing countries’ forest related policies and

practices;

Facilitate the leveraging of additional and sustained financial resources for REDD, including through a possible UNFCCC forest mechanism, leading to an effective and sustained reduction of deforestation and forest degradation, and enhancing the sustainable management of forests;

Pilot replicable models to generate understanding and learning of the links between the implementation of forest-related investments, policies and measures and long-term emission reductions and conservation, sustainable management of forests and the enhancement of forest carbon stocks in developing countries.; and

Provide valuable experience and feedback in the context of the UNFCCC deliberations on REDD.

Priorities: Investments that build institutional capacity, forest governance and information;

Investments in forest mitigation efforts, including forest ecosystem services; and

Investments outside the forest sector necessary to reduce the pressure on forests such as alternative livelihood and poverty reduction opportunities.

FIP investments also mainstream climate resilience considerations and contribute to multiple co-benefits such as biodiversity conservation, protection of the rights of indigenous peoples and local communities, and poverty reduction through rural livelihoods enhancements.

Forest Investment Program Eligibility:

FIP Investment strategies, programmes and projects should deliver transformational change and go beyond business-as-usual, and are assessed according to:

Climate change mitigation potential;

Demonstration potential at scale;

Cost-effectiveness;

Implementation potential;

Integrating sustainable development (co-benefits); and

Safeguards.

The selection of pilot programs is based on:

Programme potential to contribute and adhere to FIP objectives and principles;

Country preparedness and ability to undertake REDD initiatives; and

Existing pilot programme distribution across regions and biomes, ensuring that pilot programs generate lessons on scaling up activities.

Accessing funds: FIP grants and low-interest loans, channeled through partner multilateral development banks, are empowering countries to address the drivers of deforestation and forest degradation both inside and outside of the forest sector to achieve a triple win of poverty reduction, mitigation, and resilience.

Grant Size: $0.25-42 million USD

Instruments: Grants, concessional loans, guarantees, or equity

Clean Technology Fund

Purpose: The Clean Technology Fund (CTF), one of two multi-donor Trust Funds within the Climate Investment Funds (CIFs), promotes scaled-up financing for demonstration, deployment and transfer of low-carbon technologies with significant potential for long-term greenhouse gas emissions savings. Channeled through the African Development Bank, Asian Development Bank, European Bank for Reconstruction and Development, Inter-American Development Bank, and World Bank Group, the CTF finances 12 country programmes and one regional programme.

Priorities: Power Sector: renewable energy and highly efficient

technologies to reduce carbon intensity; Transport Sector: efficiency and modal shifts; and Energy Efficiency: buildings, industry, and agriculture

Clean Technology Fund

Eligibility: Channeled through the multilateral development banks, SREP financing supports scaled-up deployment of renewable energy solutions to increase energy access and economic opportunities.

Access: Public Sector

1. MDBs’ jointly assess interested eligible countries’ investment potential to meet CTF investment criteria (above); 2. Where there is a potential fit, MDBs conduct a joint exercise involving other relevant development partners, to discuss with interested governments, private industries and other stakeholders how CTF may help finance scaled-up low carbon activities; 3. Under the leadership of the recipient country, an investment plan (essentially the MDBs' “business plan”) is produced; and 4. CTF Trust Fund Committee reviews the investment plan with a view to endorsing a resource envelope for programs/projects and authorizing designated MDBs to proceed with development and preparation of individual investment operations for CTF co-financing. Private Sector

1) Private sector proposals are submitted in the form of either a) individual large-scale projects (“Projects”); or b) program envelopes which aggregate several small and medium sized projects each utilizing less than US$50 million of CTF funds and all having a shared focus and objective (“Programs”). 2) Proposals explain how the Projects and Programs are expected to contribute towards the objective of achieving transformational outcomes in a sector, sub-sector, country, sub-national region, sub-region, or region while demonstrating that these outcomes would not be possible without support from the CTF.

Grant Size: Unspecified Instruments: Grants, Loans, Co-Financing

Project: Renewable Energy

An expansion to the Renewable Energy Accelerator Program to address damages caused by typhoon Haiyan, and enable a 150 MW total pipeline of solar PV and biomass projects.

Project Objective: The original and expanded REAP are comprised of: capacity building, development support, market awareness, and advisory on off-grid renewable energy development for biomass, solar, and wind projects. Direct beneficiaries of the project will continue to include the islands of Visayas and Mindanao, which takes up roughly 25% of the power consumption in the country, but regularly experiences power shortages. Western Visayas, which has the largest biomass potential of 128MW, will also benefit from REAP, alongside the island of Luzon, which has high wind potential.

Country: Philippines

Region: Asia & Pacific

MDB: IFC

Thematic Focus: Mixed RE

CIF Funding ($US M):6.1

Expected Co-Financing ($US M):0.0

CIF Fund: Clean Technology Fund

Sector Type: Private

Scaling Up Renewable Energy Program (SREP)

Purpose: Demonstrate the economic, social and environmental viability of low carbon development pathways in the energy sector in low-income countries and help low-income countries use new economic opportunities to increase energy access through renewable energy use.

Priorities:

Assist low income countries foster transformational change to low carbon pathways by exploiting renewable energy potential;

Highlight economic, social and environmental co-benefits of renewable energy programs;

Help scale up private sector investments to achieve SREP objectives

Enable blended financing from multiple sources to enable scaling up of renewable energy programs; and

Facilitate knowledge sharing and exchange of international experience and lessons.

Scaling Up Renewable Energy Program (SREP)

Eligibility: Eligible new renewable energy applications include: Grid and off-grid electricity applications including small hydro or biomass-based power, wind and solar

powered systems, and geothermal. Financing available for renewable electricity generation and use, and for transmission and distribution grids; Cooking and heating applications including sustainable community forests, improved cook stoves, geothermal

heating, and biogas or other renewable-based fuels. Preference is given to projects with strong poverty alleviation benefits. Economic and/or social development

and environmental benefits are key criteria for project selection. Accessing funds: Pre-Programming Phase

1. SREP-SC to agree upon number of country or regional pilots and criteria for country selection; 2. CIF Administrative Unit, through MDBs to inform countries and invite expression of interest; 3. Selection of pilots by SREP-SC based on Expert Group Report; 4. 4MDB scoping mission at invitation of government to assess readiness and capacity for investment plans;

and 5. If requested, MDBs advance preparation grants and investment plan preparation grants to assist

development of investment plans. Grant Size: TBC Instruments: SREP uses a range of financial instruments that are already available in MDBs, including:

Output-based aid to increase the affordability of renewable energy services provision by buying down a portion of the capital cost of the investment.

Investment finance using quasi-equity financing, capital cost buy-down or other financial instruments to make grid-based renewable energy power, and related transmission and distribution investments financially viable;

Credit enhancement facilities to leverage trade finance and short-term working capital finance, and to provide partial risk coverage of loans to grid-based renewable energy investments, businesses and rural consumers who may have inadequate credit histories or limited collateral for securitizing the renewable energy loans;

Financial intermediation grants that can be on-lent as loans through domestic financial institutions, including micro-finance institutions for renewable energy investments;

Incremental budget support for national/regional programs delivering community services such as health care, water supply and education. Incremental support will be available for funding renewable energy hardware and services, including arrangements to assure long term repair and maintenance.

Project Sustainable Energy Industry Development Project

Objective: The project development objective (PDO) is to increase the data availability and capacity in Pacific island power utilities to enhance their readiness to accelerate the adoption of renewable energy sources of power generation and manage renewable energy technologies.

Country: Pacific Region

Region: Asia & Pacific

MDB: IBRD

Thematic Focus: Mixed RE

CIF Funding ($US M):1.9

Expected Co-Financing ($US M):1.7

CIF Fund: Scaling Up Renewable Energy Program

TFC/SC Approval Date: May 2015

Sector Type: Public

OTHER GLOBAL FUNDS

Global Environment Facility

Purpose: The GEF serves as financial mechanism for the following conventions:

Convention on Biological Diversity (CBD), United Nations Framework Convention on Climate Change (UNFCCC), Stockholm Convention on Persistent Organic Pollutants (POPs), UN Convention to Combat Desertification (UNCCD), Minamata Convention on Mercury and supports the implementation of the Protocol in countries with economies in transition.

Priorities: The GEF a works on several multi-focal and cross-cutting issues and programs aside from Climate Change including:

Food Security

Sustainable Cities

Commodities

Public Private Partnerships

Capacity Development

Small Grants Programme

Country Support Programme

Gender Mainstreaming

Small Island Developing States

Indigenous Peoples

Global Environment Facility

Eligibility:

Countries may be eligible for GEF funding in one of two ways:

a) If the country has ratified the Conventions the GEF serves; or

b) If the county is eligible to borrow funds from the World Bank or to receive technical assistance from UNDP.

Programmatically: It has to be country-driven and consistent with national priorities, address one or more of the GEF focal area strategies, agreed-on incremental costs on measures to achieve global environmental benefits, it has to be endorsed by the Operational Focal Point of the country in which the project or program will be implemented and it must involve the public in project design and implementation.

Accessing funds: Direct Application

Grant Size: $50,000 to Over 2 Million

Instruments: Grants & Loans

Project: Forest Management

Capacity, Policy and Financial Incentives for PFM in Kirisia Forest and integrated Rangelands Management Summary: To deliver multiple BD, CC and livelihood

benefits from 91,452 ha of Kirisia Forest under PFM and 50,000 ha of rangelands under Holistic Natural Resources Management respectively

Impact: Climate change mitigation, natural resource management, adaptation

Beneficiaries: N/A Total investment: 13 Million Years: Ongoing

The Adaptation Fund Purpose: The Adaptation Fund (AF) was established in 2001 to finance

concrete adaptation projects and programmes in developing country Parties to the Kyoto Protocol that are particularly vulnerable to the adverse effects of climate change. The Adaptation Fund is financed with a share of proceeds from the clean development mechanism (CDM) project activities and other sources of funding.

Priorities: In accordance with decision 1/CMP.3, paragraphs 1 and 2, the Adaptation Fund shall; Assist developing country Parties to the Kyoto Protocol that are

particularly vulnerable to the adverse effects of climate change in meeting the costs of adaptation;

Finance concrete adaptation projects and programmes that are country driven and are based on the needs, views and priorities of eligible Parties;

Projects and programmes funded under the Adaptation Fund should also take into account, inter alia, national sustainable development strategies, poverty reduction strategies, national communications and national adaptation programmes of action and other relevant instruments, where they exist.

The Adaptation Fund Eligibility: Eligible parties seeking financial resources from the

Adaptation Fund must submit their project and programme proposals directly through accredited National, Regional, or Multilateral Implementing Entities.

Accessing funds: Direct Application

Grant Size: Unknown

Instruments: Grants & Loans

Project:

Strengthening the Resilience of our Islands and our Communities to Climate Change Objective: This programme’s objective is to strengthen the ability of Pa

Enua, and all Cook Island communities, to make informed decisions and manage anticipated climate change driven pressures in a proactive, integrated and strategic manner.

Country/Region: Cook Islands/Asia-Pacific Sector: Multisector Project Grant Amount: USD 5,381,600 Implementing Entity: UNDP Executing Entity: Climate Change Coordination Unit and Emergency

Management Cook Islands (both in the Central Policy and Planning Unit, Office of the Prime Minister)

The Least Developed Countries Fund

Purpose: The Least Developed Countries Fund (LDCF)

finances the preparation and implementation of NAPAs in response to urgent and immediate adaptation needs in least developed countries.

Priorities: The LDCF was established to address the special needs of

the Least Developed Countries (LDCs) under the Climate Convention. Specifically, the LDCF was tasked with financing the preparation and implementation of National Adaptation Programs of Action (NAPAs). NAPAs use existing information to identify a country’s priorities for adaptation actions.

The Least Developed Countries Fund

Eligibility: Must be an LDC

Accessing funds: The Least Developed Countries Fund (LDCF) was established under the United Nations Framework Convention on Climate Change (UNFCCC) at its seventh session in Marrakech and is managed by the Global Environment Facility (GEF). The fund addresses the special needs of the 49 LDCs which are especially vulnerable to the adverse impacts of climate change. As a priority, the LDCF supports the preparation and the implementation of the National Adaptation Programs of Action (NAPAs), country driven strategies which identify urgent and immediate needs of LDCs to adapt to climate change.

Grant Size: Unspecified

Instruments: Grants

7

Project: Climate Change

Programme of Action for Adaptation to Climate Change Description: The objective of the proposed NAPA project for

Samoa is to develop a country-wide programme of immediate and urgent project-based adaptation activities that address the current and anticipated adverse effects of climate change, including extreme events.

Country: Samoa Focal Area: Climate Change GEF Agency: UNDP Executing Agency: Department of Lands, Survey and Environment GEF Project Grant: 200,000 USD GEF Grant: 200,000 USD Co-financing Total: 20,000 USD Project Cost: 220,000 USD

Special Climate Change Fund (SCCF)

Purpose: Support adaptation and technology transfer projects and programs that: are country-driven, cost-effective and integrated into national sustainable development and poverty-reduction strategies; and take into account national communications or NAPAs and other relevant studies and information provided by the Party.

Priorities: Adaptation Transfer of technologies Projects on energy, transport, industry, agriculture, forestry,

and waste management; and Activities to assist developing countries whose economies are

highly dependent on income generated from the production, processing, and export or on consumption of fossil fuels and associated energy-intensive products in diversifying their economies

Special Climate Change Fund (SCCF)

Eligibility: Eligible organizations can be public or private entities. The four main project categories that can be considered are: health; agriculture; water; and infrastructure. However, public health; education systems; infrastructure for rural development; and water sanitation are not eligible project topics.

The projects must have additional sources of co-financing, as the SCCF grants do not completely fund projects but should act to catalyze other sources of financing. Projects must address impacts of climate change on a vulnerable socio-economic sector that are above and beyond the development baseline - which does not include improved public or education, for example. The proposed activities should also achieve integration of climate change risk reduction strategies, policies, and practices into specific sectors or include institutional and constituency capacity building and awareness raising components.

Accessing funds: GEFSCCF resources can be accessed through accredited GEF Agencies (https://www.thegef.org/gef/gef_agencies)

Grant Size: Funding limit for individual projects not determined

Instruments: Grants

Project: Climate Change

The Pacific Adaptation to Climate Change (PACC) Project Objective: The Pacific Adaptation to Climate Change

(PACC) Project is the first project implemented in the region that responds directly to the call for urgent action on adaptation to climate change, while supporting the systemic and institutional capacity to do so. It is regarded as one of the first programmes moving into actual implementation on the ground and as a framework to deliver adaptation actions in the Pacific. The $57 M project is partly funded be the SCCF through a grant of $13 M and is implemented by UNDP.

Implementing Agency: UNDP SCCF Grant: $13 M

The Global Climate Change Alliance

Purpose: The Global Climate Change Alliance (GCCA) is an initiative of the European Union. Its overall objective is to build a new alliance on climate change between the European Union and the poor developing countries that are most affected and that have the least capacity to deal with climate change. The GCCA does not intend to set up a new fund or governance structure, but is working through the European Commission’s established channels for political dialogue and cooperation at national and international level.

Priorities: The five GCCA priority areas include

Mainstreaming climate change into poverty reduction and development strategies

Adaptation, building on the National Adaptation Programmes of Action (NAPAs) and other national plans

Disaster risk reduction (DRR)

Reducing emissions from deforestation and forest degradation (REDD)

Enhancing participation in the Global Carbon Market and Clean Development Mechanism (CDM)

The Global Climate Change Alliance

Eligibility/Access: The GCCA provides support to poor developing countries most vulnerable to climate change, particularly the Least Developed Countries (LDCs) and Small Island Development States (SIDS) using a set of eligibility criteria: Eligibility of a country for funding under the GCCA. The country must belong to either

the group of Least Developed Countries (LDCs) or the group of Small Island Developing States (SIDS) recipients of aid (in line with the official OECD/DAC and UN lists).

Vulnerability of the country to climate change. In particular risk related to floods, droughts, storms, see level rise or glacier melting and the coastal zone elevation with proportion of the population at risk. The importance of the agricultural sector, being one of the most sensitive sectors, is also taken into account.

The adaptive capacity of the country. Policy Context. Ideally, the country should have national and/or sectoral climate

change policies in place or expressed its intention of preparing them to ensure the integration of climate change into development strategies, plans and budgets. The government is keen to enhance policy dialogue and cooperation on climate change with the EU and donors more widely. Last, the country should preferably be involved with and be politically active in the negotiations under the United Nations Framework Convention on Climate Change (UNFCCC) and in this sense serve as a model for other countries in its group/region.

Grant Size: Unspecified Instruments: Grants & Cofinancing

Project: Mekong River

Addressing ecosystem challenges through support to the Mekong River Commission’s Climate Change and Adaptation Initiative (CCAI) Objective: An economically prosperous, socially just and environmentally sound

Mekong River Basin, responsive and adapting to the challenges induced by climate change, reflecting the overall vision of the MRC. Inherent to this goal is a commitment to poverty reduction, gender responsiveness and ecological sustainability in adapting to climate change.

Countries: Cambodia, Lao PDR, Thailand, Vietnam GCCA priority area(s): Adaptation, Mainstreaming Sector(s): Agriculture, Food security, Natural resources management, Overall

development & poverty reduction, Water Implementing modality: Project Programme type: Regional Budget: €11.7 million (GCCA: €4.95m incl. €1.54m FSF each from Ireland and the

EC, Australia: €1.64m, Denmark: €0.65m, Luxembourg: €1.89m, Germany: €1.35m, Sweden: €0.39m, Finland and Sweden through the MRC: €0.83m)

Partners: Mekong River Commission Duration: 01/2012 to 06/2016

The International Climate Fund (ICF)

Purpose: Tackling climate change and poverty reduction are two sides of the same coin – one cannot be effectively addressed without tackling the other.

The UK’s climate finance helps make some of the poorest and most vulnerable communities more resilient to climate change, for example, supporting the distribution of flood resilient crops and improving early warning systems. It is also helping create a reliable source of energy for communities which improves health, education, and enables businesses to grow, creating jobs and improving incomes and standards of living for the poorest communities. It seeks to prevent emissions now or in years to come through demonstrating how countries can shift to cleaner, low carbon approaches and technology. Our investment in the International Climate Fund is enhancing Britain’s place in the world and creating a safer and more prosperous future for us all.

Priorities:

Supporting sustainable and inclusive economic growth

Building resilience to manage risks

Improving stewardship of natural resources

The International Climate Fund (ICF)

Eligibility: Eligibility is the same eligibility as the OECD.

In reporting their ODA, donor countries refer to a List of ODA-eligible international organizations, including multilateral agencies, international NGOs, networks and PPPs. Core budget (unremarked) contributions to these organizations may be reported as ODA in whole or in part.

Accessing funds: Any applications for finance are done so in partnership with a DFID country office or UK government department.

Grant Size: Unspecified

Instruments: Grants & concessional loans

Project: Climate Investment Funds Humanitarian Preparedness Project Objective: In order to respond more effectively and efficiently to

humanitarian crises in the coming years, DFID, UNICEF, UNHCR, UNOCHA and WFP are investing in enhanced emergency preparedness. The DFID-funded project, entitled “Strengthening Humanitarian Preparedness in High Risk Countries” will support humanitarian partners to scale up their efforts and yield long term cost savings (currently averaging at £2 saved for every £1 spent), increase the speed of response (a week on average) as well as reducing greenhouse gas emissions associated with responses.

Program Priorities: Identify and assess climate risks, particularly to the most vulnerable people

and sectors Elaborate, test and implement adaptive responses Establish the basis for a climate resilient economy

Location: Nepal & Tanzania

International Climate change initiative [German Federal Environment Ministry (BMUB)]

Purpose: Since 2008, the International Climate Initiative (IKI) of the

Federal Ministry for the Environment, Nature Conservation, Building and Nuclear Safety (BMUB) has been financing climate and biodiversity projects in developing and newly industrialized countries, as well as countries in transition.

Priorities: Mitigating greenhouse gas emissions Adapting to the impacts of climate change Conserving natural carbon sinks with a focus on reducing

emissions from deforestation and forest degradation (REDD+) Conserving biological diversity

International Climate change initiative [German Federal Environment Ministry (BMUB)]

Eligibility: The IKI is able to support measures in the areas of policy advice, capacity development, technology cooperation and investment as well as concrete implementation of policies, strategies and concepts. In particular, the following approaches are eligible for support: Support for the conceptual design and implementation of policy programmes and mechanisms; Policy advice on regulatory frameworks, the removal of barriers to strategy implementation and the

development of country-specific solutions; Capacity development in public institutions, development of analysis and advisory capacity, capacity-

building among private-sector stakeholders (industry, crafts, banks, investors, technology networks); Developing specific consultancy approaches and financing and business models (see also 2.6.1

Financing instruments); Supporting project development for major funding programmes and investors (pipeline development); Actions in support of building consensus at national level (e.g. multi-stake-holder workshops); Supporting networks and transformation partnerships that bring together government institutions,

towns and cities, think tanks, civil society and the private sector; Regional/international exchange of knowledge and experience; Financial cooperation (especially financing of investment, financial contributions to financial sector

development, fiduciary holdings); Advice on, demonstration of and dissemination of technical innovations, exchange of information on

climate protection technologies including the communication of best practices.

Project: Biodiversity

Protected Area Management Enhancement In The Philippines (Pame)

Objective : The project is supporting the Philippine Government in implementing the Convention on Biological Diversity (CBD) by cooperating with local partners to improve the legal framework for protecting and managing designated protected zones in marine and terrestrial 'key biodiversity areas'. These areas are of particular international significance in conserving biodiversity. The project enhances the protected area management capacity of the Philippine environment ministry through training measures and workshops for sharing experience. In addition, it is helping to improve administrative structures and processes in existing protected areas and establish new terrestrial and marine protected areas. In this work, it is cooperating closely with local communities and giving particular consideration to the concerns of women and indigenous populations.

Country: Philippines

Partner institution: Department of Environment and Natural Resources in the Philippines (DENR)

Implementing organization: Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ) GmbH

BMUB grant: € 9,000,000

Duration: 10/2012 till 03/2017

Nordic Development Fund

Purpose: NDF provides grant financing for interventions targeting adaptation to and mitigation of climate change in low-income countries.

Priorities: Addressing the mitigation of climate change Supporting the adaptation to climate change Related to infrastructure, natural resources and capacity

building Through grant financing In low-income countries in Africa, Asia and Latin America In cooperation with multilateral and bilateral development

institutions

Nordic Development Fund

Eligibility/Accessing funds: NDF co-finances climate change initiatives in Africa, Asia and Latin America. Such funding generates opportunities for both the Nordic and the global business community. NDF will normally finance a component of a larger Programme or project and the responsibility for procurement and contract negotiations rests with the national authorities.

Grant Size: Unspecified

Instruments: Grants & Credit - In 2009 NDF shifted focus from soft loans for social and economic development to grants for climate change efforts. New financing is granted according to this new mandate. However, NDF has a considerable credit portfolio with loans outstanding under the old mandate. The grant operations under the new mandate are mainly funded from repayments of existing credits. NDF provides grants by co-financing projects with its partners in countries which are eligible for support from IDA and which have previously received NDF support

Project: Financial The project aims to help build the capacity of ADB developing member countries to access critical financing for scaling up climate change actions.

Objective: ADB approved a Regional Technical Assistance Enhancing Readiness

of ADB Developing Member Countries for Scaled Up Finance on 20 December 2013 for a total amount of USD 750,000 financed by the ADB Technical Assistance Special Fund. It is being implemented by ADB's Climate Change and Disaster Risk Management Division (SDCD). The TA aims to help build the capacity of ADB developing member countries to access critical financing for scaling up climate change actions. In its current form, the TA aims to help 3 such countries to develop the capacity to identify priority infrastructure investment projects that mitigate climate change and/or support adaptation to climate change, while creating development co-benefits.

Regional Asia: Developing Member Countries for Scaled Up Finance Project Ref: NDF C89 NDF contribution: EUR 0.5 million Total project cost: USD 1,500,000 Project period: 2016-2017 Partner agency: Asian Development Bank (ADB)

The Nordic Climate Facility (NCF) – [Subcategory of the NDF]

Purpose: The Nordic Climate Facility finances projects that have a potential to combat climate change and reduce poverty in low-income countries. The Facility is financed by the Nordic Development Fund (NDF). Calls 1-4 are administered by Nordic Environment Finance Corporation (NEFCO). NCF encourages and promotes technological innovation in areas susceptible to climate change such as: energy, transport, water and sanitation, health, agriculture, and forestry and other areas related to natural resource management.

Priorities: The calls for proposals focus on adaptation to and/or mitigation of climate change. Climate change adaptation proposals may be related to issues such as rising sea levels, and threats to water and agricultural resources as well as to overall human welfare. Climate mitigation proposals can comprise efforts to reduce the emission of greenhouse gases through the use of energy efficiency technologies, substituting fossil fuels for environmentally sound renewable sources, and carbon sequestration. The climate change themes vary each year and proposals may also combine adaptation and mitigation components.

NCF was launched in 2009, and so far six calls have been announced under the themes of: NCF 1 Water resources and energy efficiency

NCF 2 Renewable energy and urban adaptation

NCF 3 Innovative low-cost climate solutions with focus on local business development

NCF 4 Inclusive green growth projects contributing to private sector development

NCF 5 Climate resilience in urban and private sector contexts

NCF 6 Green growth for sustainable livelihoods

The Nordic Climate Facility (NCF) – [Subcategory of the NDF]

Eligibility: The applicant must be an active institution, organization, company or authority holding a registered place of operations in Denmark, Finland, Iceland, Norway or Sweden with relevant experience. The applicant may have one or more partners. The applicant shall have one or more eligible local partners in a country in which the project is proposed to be implemented. The applicant’s average annual audited turnover for the past two years must exceed twice the NCF funding applied for. In case the applicant alone cannot fulfil this requirement, the applicant is allowed to be supported by another Nordic institution, organization or company.

Accessing funds: Apply directly if eligible

Grant Size: The best proposals may receive grant co-financing amounting to between EUR 250,000 and 500,000.

Instruments: Grant co-financing

Project: NDF C3 D1

Bangladesh NAMA and Innovative Energy Optimization in the Steel Sector in Bangladesh Project Objective: The overall objective of the project is to improve energy

efficiency in the steel sector in Bangladesh. The project intends to achieve the objective by improving the existing steel production technology and optimizing production routines. Nationwide transition will be sought through developing a draft Nationally Appropriate Mitigation Action plan (NAMA), which aims to put energy optimization in the steel sector on the national agenda.

Nordic Partner: Viegand & Maagøe A/S Local Partner: Modern Erection Ltd and Vikrampur Steel Ltd Other Partners: NIRAS A/S and Royal Danish Embassy Total Project Cost: EUR 461,650 NCF Financing: EUR 299,340 Agreement Signed: 21 March 2013 Project Classification: Mitigation Duration: 24 Months

UN-REDD

Purpose: Generate the necessary flow of resources to significantly reduce global emissions from deforestation and forest degradation in developing countries. The immediate goal is to assess whether carefully structured payments and capacity support can create the incentives to ensure lasting, reliable and measurable emission reductions while maintaining and improving other ecosystem services as well as the economic and social values that forests provide.

Priorities: Measurement, reporting and verification (MRV) and Monitoring; National REDD+ Governance; Engagement of Indigenous Peoples, Local Communities and Other Relevant

Stakeholders; Ensuring Multiple Benefits of Forests and REDD+; Transparent, Equitable and Accountable Management of REDD+ Payments; and, REDD+ as a Catalyst for Transformation to a Green Economy.

UN-REDD

Eligibility:

Partner country of UN-REDD Programme

(Vanuatu, Solomon Islands, PNG, Malaysia, Lao PDR, Indonesia, Fiji)

Achieving regional balance;

Enhanced coordination with other initiatives;

Ability of UN agencies to assist the country;

Ability to demonstrate progress/results in the short term based on REDD+ early action;

REDD+ potential; and

Commitment to applying the principles of the UN-REDD Programme.

Accessing funds: National governments, Regional Development Banks and NGOs can receive funding through a participating UN organization acting as executing agencies. To participate in the UN-REDD Program it is necessary to download and fill in a request form.

Grant Size: Limit unspecified

Instruments: Grants & technical assistance

Project: Vanuatu

Strengthening Regional Support to National Forest Monitoring Systems for REDD+ in the Pacific Overview: The project “Strengthening Regional Support to National Forest

Monitoring Systems for REDD+ in the Pacific”, funded by the UN-REDD and executed by the Food and Agriculture Organization (FAO) through the Pacific Community (SPC) has been carrying out capacity building activities since its implementation in May 2014. Together, FAO and SPC have been assisting the countries in building a robust National Forest Monitoring System in the Pacific through its regional training workshops and national backstopping activities

Country Area : 12,189 km2 Forested Area (1000 ha) : 440 UN-REDD Programme Partner Country : Yes FCPF Member : Yes Active FCPF Grant Holder: Yes Readiness Grant Holder: Yes Carbon Fund: No

Forest Carbon Partnership Facility

Purpose: Assist developing countries to reduce emissions from deforestation and forest degradation, enhance and conserve forest carbon stocks, and sustainably manage forests (REDD+)

Priorities: Forestry (REDD approach towards emission reduction, conservation of biodiversity, and enhancement of livelihoods of local communities). Knowledge dissemination.

Forest Carbon Partnership Facility

Eligibility: Countries which are Borrowing Member State of the IBRD or IDA and are located in the Tropical Areas or Sub-tropical Areas are eligible. Priority will be given to countries with significant forest area and carbon stock, high importance of forests in the national economy and high current or projected deforestation or forest degradation rates.

Accessing funds: Submit Readiness Plan Idea Note (PIN) to Facility Management Team

Grant Size: Up to $3.6 million USD

Instruments: Readiness fund is grant based. Within carbon Fund, funds are delivered in exchange for emission reductions.

Adaptation for Smallholder Agriculture Programme

Purpose: To channel climate and environmental finance to smallholder farmers, scale up climate change adaptation in rural development programmes and mainstream climate adaptation into IFAD’s work.

Priorities: Improving land management and climate resilient agricultural

practices and technologies; Increasing availability of water and efficiency of water use for

smallholder agriculture production and processing; Increasing human capacity to manage short- and long-term

climate risks and reduce losses from weather-related disasters; Making rural infrastructure climate-resilient; and Improving the documentation and dissemination of Climate

Smart Smallholder Agriculture knowledge.

Adaptation for Smallholder Agriculture Programme

Eligibility: Smallholder farmers in developing countries (Existing and new IFAD investment programmes in poor developing countries which are vulnerable to climate impacts)

Accessing funds: ASAP does not employ specific application procedures like other funds (such as issuing calls for proposals) that can be accessed by NGOs or CSOs directly. Results-Based Country Strategic Opportunities Papers (RB-COSOPs) are a typical point of departure for an ASAP investment, highlighting climate change adaptation as a strategic decision for IFAD operations in a specific country.

Grant Size: $2-15 million

Instruments: Co-financing grant

Project: Vietnam

Project for Adaptation to Climate Change in the Mekong Delta in Ben Tre and Tra Vinh Provinces The goal of this project is to support sustainable livelihoods for the rural poor in

a changing environment, strengthening the adaptive capacity of target communities and institutions to better contend with climate change.

The two main components of the project are: Building the capacity for climate change adaptation with participating

communities, institutions and provinces for the agriculture and rural development sector

Investing in sustainable rural livelihoods by providing the financial means and facilities to scale up the results of community-based research and development in this sector.

Total project cost: US$ 49.3 million Total IFAD financing: US$ 34.0 million IFAD loan: US$ 22.0 million IFAD ASAP: US$ 12.0 million Duration: 2013 - 2019 Directly benefiting: 15,000 households Status: Ongoing

Global Energy Efficiency and Renewable Energy Fund

Purpose: Catalyze private sector capital into clean energy projects in developing countries and economies in transition.

Priorities: Mitigation,

Renewable energy,

Energy efficiency, and

Infrastructure projects that generate clean power through proven technologies with low risk.

Global Energy Efficiency and Renewable Energy Fund

Eligibility: Focus on project funding in countries that have private sector engagement in their national policies. Prioritizes small projects (less than EUR 10 million) as they are often neglected. Recipient countries must be eligible for Official Development Assistance.

Accessing funds: Fund management companies, financial institutions, project developers or individuals that intend to develop a clean energy investment fund or expand an existing fund into clean energy can submit proposals to seek finance. Developers of clean energy projects can also submit proposals for investment funds

Grant Size: An overall size of between € 50 million and € 200 million ($50-221 million)

Instruments: Private equity, grants and technical assistance

Project: Armstrong Fund

ARMSTRONG SOUTH EAST ASIA CLEAN ENERGY FUND GEEREF HAS COMMITTED € 10.0 MILLION TO THE ARMSTRONG S.E. ASIA CLEAN ENERGY FUND, MANAGED BY ARMSTRONG ASSET MANAGEMENT Armstrong is a private equity fund that invests in small-scale

renewable energy and resource efficiency projects in Southeast Asia, focusing particularly on Thailand, Philippines, Indonesia and Vietnam. This strategy is driven by the high energy demand and strong market fundamentals in the region.

The investment strategy is based on a market demand supported by strong economic fundamentals; a commitment to positive social and environmental impact; risk minimization through a portfolio of small-scale projects; no technology risk; the ability to generate early cash flows; positive entry valuations due to lack of investor competition; competitive advantage as a result of the team’s local operating experience; and a clear exit strategy.

NAMA Facility

Purpose: On 4 July 2016, the German Federal Ministry for the Environment, Nature Conservation, Building and Nuclear Safety (BMUB) and the UK Department of Energy and Climate Change (DECC) have committed to fund up to € 60 million for a 4th Call of the NAMA Facility. The NAMA Facility will continue to support developing countries and emerging economies in implementing the most ambitious NAMAs with a high potential for transformational change towards a low-carbon development trajectory.

Priorities: The objective of the NAMA Facility is to provide financial support for implementing national climate strategies and Nationally Determined Contributions (NDCs) via NAMAs in relevant sectors thereby realizing sustainable transformational change towards a low-carbon pathway. This is done through funding NAMA Support Projects (NSPs) that have the potential to catalyze transformational change towards low-carbon development in the overall sector. With this objective in mind, the Donors of the NAMA Facility decided to hold open competitive Calls for NSP Outlines and select the most ambitious, innovative and promising NSPs for funding. In line with this strategy, the NAMA Facility has no regional or sector focus.

NAMA Facility

Eligibility: In the initial Outline Phase, national ministries or legal entities may function as applicants, i.e. submit a NSP Outline to the NAMA Facility.

Accessing funds: Following the decision by the Board to avail funding for new NSPs, the TSU initiates the selection process for NSPs via a public Call for NSP Outlines. In order to identify the most ambitious and feasible projects, a competitive two-phase selection process applies. - Phase 1 (Outline Phase) & Phase 2 (Detailed Preparation Phase, DPP/Proposal Phase):

Grant Size: Not Specified

Instruments: Grants

Project: Thailand

Thailand Refrigeration and Air Conditioning NAMA (RAC NAMA)

Outline: The NAMA will transform the production and use of RAC appliances for both the domestic and commercial sectors. Key stakeholders benefit from and support this reform: Manufacturers will be able to produce technically advanced, sustainable and competitive products for the domestic and export markets.

Partner ministries: Ministry of Natural Resources and Environment (MNRE) - Office of Natural Resources and Environmental Policy and Planning (ONEP), Ministry of Energy

Delivery organisation: Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ) GmbH

Implementing partner: Department of Alternative Energy Development and Efficiency (DEDE); Department of Energy Policy and Planning (EPPO)

Project volume: EUR 14.7 million

Project duration: 2015 to 2019

International Partners on Mitigation and MRV

Purpose: In the framework of the Petersburg Climate Dialogue in May 2010 in Bonn/Germany, South Africa, South Korea and Germany launched the International Partnership on Mitigation and MRV. The overall aim of the Partnership is to support a practical exchange on mitigation-related activities and MRV between developing and developed countries in order to help close the global ambition gap. The Partnership is comprised of approximately 90 countries, the majority of which are from developing countries. The International Partnership on Mitigation and MRV has no formal character and is open to new countries.

Priorities: To this end, the activities of the Partnership contributes to the design and effective implementation of:

'Intended Nationally Determined Contributions' (INDCs)

‘Low-Emission Development Strategies’ (LEDS),

‘Nationally Appropriate Mitigation Actions’ (NAMAs),

‘Measuring, Reporting and Verification’ (MRV) systems and

Bringing together climate experts from a variety of countries, the Partnership seeks to:

foster mutual learning between peers

identify best practices

establish a shared mitigation-related knowledge base

disseminate lessons learnt

International Partners on Mitigation and MRV

Eligibility: The Partnership is comprised of approximately 90 countries, the majority of which are from developing countries. The International Partnership on Mitigation and MRV has no formal character and is open to new countries.

Accessing funds: Any country with an ambitious or upcoming climate agenda is very welcome to join. In case of interest in becoming a partner country

Grant Size: Not Specified

Instruments: Grants, Co funding

Project: Indonesia

Indonesia's National Carbon Accounting System

Summary: Australia is providing support for the design and implementation of Indonesia’s National Carbon Accounting System. The system will support Indonesia’s participation in a future mechanism for REDD and enable Indonesia to measure, report and verify greenhouse gas emissions related to forests. It will also increase Indonesia’s ability to monitor and manage forests by providing credible and transparent information about changes to forest area.

Region: Oceania

Country: Indonesia

Implementing Organisation: Australian Agency for International Development (AusAID)

Funding Source: Australian Agency for International Development (AusAID)

Duration: June 2008 - June 2012

German Ministry for the Environment and Building and German Ministry for Economic Cooperation and Development present their

initiative at the Petersburg Climate Dialogue

Implementation partnership has been initiated jointly by the German Ministry for the Environment and Building and the German Ministry for Economic Cooperation and Development together with the World Resources Institute (WRI).

Its goal is to support developing countries in specifying and implementing their nationally determined contributions. It also aims to help merge existing climate and development goals and to achieve greater harmonization among the various donor programmes.

Additionally, the climate action projects of both ministries will focus to an even greater extent on implementing the nationally determined contributions under the Paris Agreement.

Developing countries, donor countries, institutional partners and NGOs will participate in the partnership. Membership is open to all countries.

CARBON-RELATED MECHANISMS WITHIN RESULTS-BASED FINANCE

CARBON MECHANISMS REDD+ NON-REDD+ NON-CARBON

Biocarbon Fund (BCF) Forest Carbon Partnership

Facility (FCPF)

Global Energy Transfer

Feed-In Tariffs Programme

(GET FiT)

Carbon Initiative for

Development (Ci-Dev)

Norway International

Climate and Forest Initiative

(NICFI)

International Energy and

Climate Initiative – Energy+

Pilot Auction Facility (PAF) KfW performance-based

climate finance facility

(PBCFF)

Prototype Carbon Fund

(PCF)

N20 Initiative by German

Government

Transformative Carbon

Asset Facility (TCAF)

Nordic Climate Facility

(NCF)

Energising Development

(EnDev)

Carbon Initiative for Development (Ci-Dev)

• Launched in December 2011 • Supports investments in LDCs to improve/increase access to clean

energy, using carbon-linked performance payments • To demonstrate that performance-based payments for purchase of

CERs can lead to viable business model that promotes increased private sector participation

• To spread scope of CDM (PoAs) to LDCs to share benefits of carbon finance, and their developmental co-benefits

• To support LDCs to develop standardized baselines in rural electrification, household energy access and energy efficiency

• To bridge current low demand for CDM credits until carbon markets recover and to use rigorous MRV framework of CDM as a powerful vehicle for disbursing RBF

• Raising climate mitigation awareness in LDCs and preparing them to benefit from future carbon markets

Example: Biogas plants in Nepal

• Installed 162,000 quality-controlled, small-sized biogas plants, providing subsidies for poor households

• Plants displace traditional fuel sources, introduce treatment of animal/human wastes, and produce high-quality organic fertilizer

• Each plant reduces 4.6 tCO2e annually, total project generates 6.5 million tCO2e during 10 year crediting

• Fund to purchase min. 1 million tCO2e and provides technical assistance for registration/MRV

“The new stove is cleaner, faster and more reliable. Before, smoke used to irritate my eyes, and nose and lungs, and I had less energy. Now I don’t have any of these problems. Before, I used to spend three hours preparing a meal. With the new stove I spend half that time. Now I can use that extra time to do other things at home.” Punyadumari Sanjel, age 70

WBG Pilot Auction Facility

• Project-based mechanism, mainly targeting stalled CDM pipeline • Backed by Germany, Sweden, Switzerland, US, capitalization target of

$100m, current capitalization $53m • Allocates public funds to provide financial incentive for private sector to

fund projects • In first phase, supports projects that reduce methane emissions at landfill,

animal waste, and wastewater sites facing low carbon prices • Performance-based: PAF disburses only after emission reductions

independently verified (under CDM, Verified Carbon Standard or Climate Action Reserve)

• Acts as carbon price insurance by setting floor price for future carbon credits in form of tradeable put option, competitively allocated via auction. Auction winners/bondholders have right (not obligation) to sell emission reductions achieved to PAF at put option “strike” price

• If carbon market price > strike price no disbursement

Prototype Carbon Fund (PCF)

• Partnership of 17 companies, 6 governments

• Operational since April 2000, total capital of US$ 180m

• To pioneer market for project-based GHG reductions while promoting sustainable development and offering a learning-by-doing opportunity to its stakeholders

WBG Transformative Carbon Asset Facility (TCAF)

• Has mobilized US$ 250m from Germany, Norway, Sweden, Switzerland

• Will help countries implement their NDCs but not yet fully operational

• Rewards countries for reducing emissions through per-ton abatement payments, carbon price set on case-by-case basis

• Based on a sectoral/policy crediting approach • Pilot in Sri Lanka: to meet target of 20% energy

from RE

Cambodia sells carbon credits to Disney under REDD+

• Disney Co. purchased 360,000 t worth (US$2.6m) of carbon emissions from Keo Seima Wildlife Sanctuary to offset its global carbon footprint (to meet own target of halving emissions by 2020)

• Revenues earmarked to help government protect sanctuary from illegal logging

• Under Reducing Emissions from Deforestation and Degradation (UN-REDD+)

• Example of sustainable financing to preserve protected areas, but not driven by profit motive

• MRV through two voluntary carbon market standards: VCS and Climate, Community and Biodiversity Standards

SMALL- AND MEDIUM-SIZED ENTERPRISE SUPPORT

infoDev Climate Innovation Centres

• Climate Innovation Centres provide holistic support to entrepreneurs and new ventures that surpasses traditional incubation models

• Centres offer seed financing, policy interventions, and network linkages, as well as technical and business training

• 7 centres worldwide but scaling-up