Unveiling GCF Funding: Investment Criteria, Approval Process, and Portfolio Impact

1. Introduction to GCF Funding for ProjectsLao PDR National Dialogue GEF-GCFVientiane, 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. ALLOCATION FRAMEWORK 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 Criteriaagainst which proposals are assessed • 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

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

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

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

10. 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 Completeness of Funding Proposal Package

11. PROJECT PREPARATION FACILITY (PPF) Project Preparation Facility 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 1 2 3

13. SAP - What has been simplified?

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: www.greenclimate.fund/how-we-work/redd

15. GCF Private Sector Strategy I. • 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. 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 Portfolio Overview 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 145 000 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 www.greenclimate.fund/projects/browse-projects

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