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Investment subsidy

Investment subsidy. Curse or blessing. Subsidy, what the issue (Bryson). Subsidy component raises questions: Media Evaluations Host-governments Donors Development practitioners Internal SNV staff. Why is this an issue.

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Investment subsidy

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  1. Investment subsidy Curse or blessing

  2. Subsidy, what the issue (Bryson) • Subsidy component raises questions: • Media • Evaluations • Host-governments • Donors • Development practitioners • Internal SNV staff

  3. Why is this an issue Biogas programmes do not always have an explicit justification for subsidy. The justification for subsidy is subject to context, place and phase of the programme.

  4. What will happen if the issue is not addressed Public support for domestic biogas programmes with an investment subsidy component will erode.

  5. The Subsidy Justification Tool: SJT® • Justification based on: • Internal strategy • (quality enforcement, pro-poor) • External justification • (EIRR minus FIRR, carbon value) • Situational (country/time/environment) • (promotion, priming the market, energy pricing)

  6. Arguments in favour • Promotional tool • Quality leverage • Priming the market • Pro-poor • Affordability • Public benefit • Govt. commitment • Steers development

  7. Arguments against • Market distortion • Inflexibility • Suppresses innovation • Expensive • Private benefits • Addiction • Unsustainable • Q-ownership

  8. Subsidy justification score Arguments in favour Arguments against

  9. Management reply The Xxxx Domestic Biogas Programme decides (not) to provide (propose) an investment subsidy for domestic biogas plants constructed under their programme because ….

  10. SJT teams • Tanzania: Peter & Sebastian • Ethiopia 1: Meselle & Fikru • Ethiopia 2: Banjajehu & Melis • Burkina: Fulgence & Eduard • Nepal: Jeremy & Lek • Laos: Nini & Rajendra • Pakistan: Rajesh & Jan • Rwanda: Elvine & Anaclet • Uga/Ken: Patience & Mozes • Devil’s advocate: Fred & Felix

  11. Thanks you

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