1. Introduction to GCF Funding for Projects Lao PDR National Dialogue GEF-GCF Vientiane, 12-14 Feb 2019
Janie Rioux, Agriculture and Food Security Senior Specialist
Chibesa Pensulo, Water Specialist
Green Climate Fund

2. Outline GCF allocation and results areas Investment criteria
Business model
Project cycle and assessment
Funding windows
Portfolio overview
Examples of projects in the region

3. GCF Allocation Framework
50/50 split between adaptation & mitigation
Geographic balance
50% of adaptation resources for SIDS, LDCs and African States
Significant allocation to Private Sector Facility
Sufficient resources for readiness activities
Grant equivalent term

4. GCF eight Strategic Result Areas
To promote a paradigm shift to low- emission and climate- resilient sustainable development

5. Six Investment Criteria against which proposals are assessed
Impact potential
Paradigm shift potential
Sustainable development potential
Country ownership
Efficiency & effectiveness
Responsive to needs of recipients
Potential to contribute to achievement of Fund's objectives and result areas
Catalyze long-term impact beyond a one-off investment
Wider economic, environmental, social (gender), health co-benefits
Degree to which the project fits within the beneficiary country’s existing policies, climate strategies and institutions
Economic (and financial) soundness, as well as cost-effectiveness and leveraging of co-financing
Vulnerability and financing needs of beneficiary country and extent to which the project addresses vulnerable groups

6. Financial Instruments
Concessional Loans
Grants
Reimbursable grants
Equity
Guarantees
What areas of mitigation and adaptation will we fund?
Adaptation – Activities that make resilient :
the livelihoods of people and communities
Infrastructure & built environment
Ecosystems & ecosystem services
Health, food & water systems
Mitigation – activities that reduce or avoid emissions:
Energy generation & access
Transport
Appliances, buildings, cities & industries
Forests & land use
For each activity in any of these areas, we will also be looking for impacts, paradigm shift potential, crosscutting benefits & sustainable development co-benefits
Will cover this in more detail in the next presentation

7. 75 entities accredited to date
A Diverse Network of Partners
75 entities accredited to date
Antigua & Barbuda
China
Fiji
Morocco
Namibia
Morocco
Bangladesh
Senegal
China
Korea
Argentina
India
Rwanda
Indonesia
India
Kenya
Mongolia
Bangladesh
Ethiopia
Peru
South Africa

8. Proposal Approval Process
1- project idea
2- concept note
3- funding proposal submission
4- proposal review and assessment
Secretariat + Panel
5- Board decision
6- Legal arrangement
From project origination to Board approval
Schematic on the Fund’s proposal approval cycle
Generation  Concept Note Funding Proposal
Iterative process between the NDA or focal point, the accredited entity and the Fund’s Secretariat until funding proposal is finalized
For the NDAs and focal points, it culminates with the issuance of a ‘no-objection letter’
Analysis/Recommendation  Decision
Decision by the Board of the Fund based on analysis by Secretariat and independent Technical Advisory Panel

9. Accredited Entity NDA Funding Proposal Review Process
Stage 1 Completeness check and preliminary review
Completeness of documentation and level of detail
Technical soundness
Climate rationale
Accredited Entity
Stage 2 Inter-Divisional Secretariat Assessment
Technical assessment
Performance against investment criteria
Compliance with GCF safeguards & policies
Stage 3 Independent Technical Advisory Panel
Technical assessment
Performance against investment criteria
Stage 4 Submission to the GCF Board

10. Completeness of Funding Proposal Package
Project documentation:
Funding Proposal
No-objection letter from the country NDA
Feasibility study -> providing climate rationale, proposed options, economic & financial analysis
Detailed budget and procurement plan
Logical framework
Stakeholder consultations
Environmental and social impact assessment, and management plan
Gender assessment and action plan
Risk assessment and management framework

11. Project Preparation Facility
PROJECT PREPARATION FACILITY (PPF)
Support for project / programme development
What is on offer?
Especially micro-to-small size projects
Up to USD 1.5M per project preparation request
Accredited entities, especially direct access, submit requests
How to apply?
Request submitted with project / programme concept
In conjunction with no-objection letter from NDA / focal point
Secretariat assesses concept against investment criteria
What is assessed?
Also assesses request for justification of needs & GCF policies
GCF Executive Director approves request

12. Simplified Approval Process (SAP) Eligibility criteria
Ready to be scaled-up, with potential for transformational impact
GCF funding of up to USD 10 million
Minimal to no environmental & social risks 1
There are the three eligibility criteria for SAP projects and programmes.
The first criterion is that the project should be ready to be scaled up and have the potential for transformational impacts, promoting a paradigm shift to low-emission and climate-resilient development. If the proposed project is already tested and has proven its impacts through a previous project, and that it is ready to be scaled up, then it is the good case for SAP. At the level of funding proposal, the AE should demonstrate the pathway to transformation through the theory of change approach, at the “paradigm shift potential” section of the investment criteria.
The second criterion is that requested GCF funding should be up to USD 10 million. This doesn’t mean that the overall project size should be 10M. With the co-financing, the total project cost can be over 10M.
The last criterion is that the project should have minimal or no environmental and social risks. At the GCF, this is equivalent to ESS category of C or intermediation 3. I will talk about the ESS part a bit later. 2 3

13. SAP - What has been simplified?
Standard project/programme
SAP
project/programme
Preparation
Full studies & appraisals
Lengthy funding proposals (average 70 pages)
Simpler documents to prepare (e.g. pre-feasibility study, ESAP, etc.)
Review
Case-by-cases
(depending on the complexity of the project structure/design)
Aim for:
2 weeks for CNs
4 weeks for FPs
Rolling-basis review both by Secretariat & ITAP
Approval
At regular Board meetings (3-4 times a year)
At regular Board meetings; In-between Board decision to be considered
Disbursement
Average 407 days until 1st disbursement
Piloting faster disbursement
Since the launch of the SAP, we have received a lot of questions about what has been actually “simplified”. Simplification can be done at four stages of the proposal approval process, as you can see in the table, preparation, review, approval and disbursement. In short, we have done a lot of simplification for the AEs and NDAs on the preparation side, and we are working to expedite our processes for review, approval and disbursement.
On the preparation side, the standard projects require full set of documents including full feasibility studies, environmental and social impact assessment or management plans depending on the ESS risk category of the project, detailed economic and financial analysis, and so on. Because of the heavy information required, the funding proposal usually goes for an average of 70 pages of length when completed due to many detailed sections and sub-sections. In the case of SAP, we need much lesser documents. For example, pre-feasibility instead of feasibility study is sufficient, and environmental and social action plan would be enough in case there is any activities that require mitigation measures in terms of environmental and social risks are foreseen.
On the review side, review by the Secretariat takes time on a case-by-case basis, depending on many variables such as complexity of the project design. For the SAP proposals, we aim to revert back to the AEs and NDAs within 2 weeks in the case of concept notes and 4 weeks for the funding proposals. We also review on a rolling-basis.
For both standard proposals and SAP proposals, Board’s consideration and approval take place at the regular Board meetings which take place 3 to 4 times a year. We are however working to bring in in-between Board decision for approval of SAP proposals. This was unfortunately not considered by the Board at B.20, but we hope this to be discussed and approved by the Board at the next Board meeting.
Since the first approval of the funding proposals at B.11, it was reported that an average of 13 months to disburse funding to AEs. For the SAP, we aim to reduce this time and the SAP is monitoring this process to fully operationalize this.

14. Request for Proposals for REDD+ Results-Based Payment
Size of envelop: USD 500 million
Eligibility period of results: 31 December 2013 (time of adoption of the Warsaw Framework for REDD+) until 31 December 2018
Financial valuation of results: USD 5 / tCO2eq
GCF payable amount: a country can submit more than one proposal up to maximum 30% of the total envelop
Application period: from October 2017 until the last meeting of the Board in 2022
More information:

15. GCF Private Sector Strategy
Take more risk to crowd in finance for paradigm shift
e.g. (i) local currency financing and (ii) more equity / less debt
II.
Support the development of climate-compatible financial systems
e.g. (i) readiness, financing for national climate banks and (ii) support to build capital markets for “green” securities
III.
Act as a “market maker” for sector transformation
e.g. (i) strengthened GCF Country Programs and (ii) targeted programs and RFPs to implement national sector priorities
IV.
Improve impact and engagement with PS e.g. Project cycle (“notification”) and accreditation reforms

16. Portfolio Overview
93 projects and programmes $4.6 billion GCF funding and $11.7 billion co-financing
272 million people with increased resilience
1.4 billion tonnes CO2eq avoided
Status as of B.21

17. Examples of approved projects in the region
Cambodia : Climate-friendly agribusiness value chains sector project (ADB)
Cross-cutting (adaptation) project: $30M grant, $10M loans, $100M co-financing
1.4 M beneficiaries, and 240 K tonnes of CO2eq avoided
Bhutan: Bhutan for Life- support forest management and protected areas (WWF)
Cross-cutting (mitigation) project: $27 M grant, and $90M co-financing
35M tonnes of CO2eq avoided, and beneficiaries
Vietnam: Scaling up energy efficiency for industrial enterprises (World Bank)
Mitigation project: $75M guarantee, $11M grant, $400M co-financing
120 M tonnes of CO2eq avoided

18. Approved Projects

19. For more info, visit www.greenclimate.fund
Janie Rioux
GCF Agriculture and Food Security
Senior Specialist
Chibesa Pensulo
GCF Water Specialist