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The ecbi Finance Circle
Public Library
Difficulties within the UN Green Climate Fund will bleed into sensitive negotiations on climate change next week in Bangkok
29 August 2018
Publisher:
Climate Home News
What exactly are ‘common time frames’ for NDCs? While there is little doubt that the communality in question refers to NDCs and thus to Parties of the Paris Agreement, it is not self-evident what exactly the term ‘time frame’ refers to. So, it may be most fruitful to begin by looking at the options for (common) time frames, in order to be able to proceed with evaluating their usefulness in a meaningful manner.
16 July 2018
A proposal to establish a similarly structured trans-national Western Climate Fund to receive contributions for the multilateral funds of the Paris Agreement, in particular the LDCF, from States and Provinces in or around the Western Climate Initiative (WCI).
16 May 2018
LDC Chair Gebru Jember Endalew writes: "Dear Governor Brown, As Chair of the UNFCCC Group of Least Developed Countries (LDCs), I would like to bring to your attention a proposal for a Fund to collect contributions for multilateral climate finance, in particular for the United Nations LDC Fund, from States and Provinces in or around the Western Climate Initiative... ."
07 May 2018
Submission on Common Timeframes for NDCs by TRINIDAD AND TOBAGO AND BELIZE
03 April 2018
The case for a ready-made innovative stream of finance in support of the current international climate negotiations Oxford Energy and Environment Brief
25 January 2018
A wave of anti-Trump, pro-climate enthusiasm has washed across the US since president Donald Trump decided to abandon the Paris climate agreement.
Affirmations of the Paris goals have come from thousands of centres of power. State capitols, mayors’ offices and boardrooms have aligned to tell Trump “We Are Still In”. Twelve states, plus Puerto Rico, representing a third of US citizens, have joined the United States Climate Alliance, which commits to meet the carbon cuts the US pledged to the Paris accord.
But those standing by the agreement had, until this week, universally ignored the part of the deal that binds it all together – cash.
16 June 2017
Final draft Leaders’ Joint Statement on Climate Change and Clean Energy, EU-China summit 2 June 2017 Brussels, published at:
http://www.climatechangenews.com/2017/06/02/eu-china-statement-manifesto...
06 June 2017
Funding climate change adaptation for the poorest and most vulnerable
24 May 2017
Personal letter of appreciation to Massachusetts State Senator Mike Barrett from UNFCCC Executive Secretary Patricia Espinosa
05 April 2017
SD2138, An Act enabling taxpayer donations to the Least Developed Countries Fund, an initiative of the U.N. Framework Convention on Climate Change
Fact sheet for Massachusetts Senate draft Bill SD2138
SD2138 creates the option of a voluntary donation on state tax returns to help the world’s most vulnerable countries cope with global climate change.
31 March 2017
Submission on the Review of the Functions of the Standing Committee on Finance
We propose that the SCF, in its resource mobilization function, develop a Work Plan on Alternative and Innovative Sources of Finance (similar to the existing Work Plan on MRV of Support) – possibly implemented through the Long-Term Finance Work Programme under the aegis of the SCF – with the aim to produce regular (biennial) reports to the COP and the CMA to feed, inter alia, into the biennial ministerial roundtable on climate finance
28 March 2017
Massachusetts-U.N. Least Developed Countries Fund
An Act enabling taxpayer donations to the Least Developed Countries Fund, an initiative of the U.N. Framework Convention on Climate Change as filed by Massachusetts State Senator Michael J. Barrett, 28 March 2017
28 March 2017
“Once more unto the breach, dear friends, once more”: A call for Europe to demonstrate renewed leadership in the international climate change regime
STRATEGY NOTE
March 2017
The surprise election of avowed climate sceptic Donald J. Trump as the 45th US President not surprisingly led some commentators to highlight parallels with the situation in 2001, when President George W. Bush repudiated the Kyoto Protocol
This Strategy Note looks at the situation in 2001 – when the EU took the initiative to save the Kyoto Protocol – and now, with a view to assessing the need for, and chances of, invigorated EU leadership in the international effort to combat climate change under the 2015 Paris Agreement.
Given the statements made by the Chinese leadership in the aftermath of the recent US elections, it is clear that China is willing to continue playing a leading role, both in its domestic actions and in the international climate negotiations. But, the authors argue, the loss of the developed country partner in the ‘G2’ has put China as a developing country in a difficult position because of the internationally acknowledged requirement for leadership from the developed world.. In order to get the maximum ambition out of the Paris Agreement, there needs to be a suitable developed country partner to take up the role of the US in the G2.
This, the authors argue, is where the EU can and must enter into the picture: to help provide the geopolitically balanced leadership which the Paris Agreement requires, if not to survive, then in order to be ambitious and effective. They propose two related measures that would be conducive to that end.
For the new G2 partnership to be as ambitious and effective as possible, the authors suggest that it should be based on ‘strategic collaborations’, by which they mean collaborative actions that involve some concrete quantified targets to be achieved under the collaboration, be it in terms of reducing (utility) emissions or through the linking of emissions trading schemes.
In light of the complexity of competencies in the EU, they also suggest that for collaborations in areas with mixed or sole Member State competence, the presence of a high-level EU ‘Special Envoy for Strategic Climate Change Collaboration’ could be helpful – not only in matters of internal coordination, but as designated interlocutor managing the external relations of the collaborations.
Strategic collaborations thus facilitated should help the EU to demonstrate renewed leadership, in particular (but not only) to partner with China in an ambitious and effective new G2.
It should also be recognized that strategic relationships with other countries, including G 77, should also be an element in the EU effort.
27 February 2017
TAPPING INTO SOCIALLY RESPONSIBLE CORPORATE AIR TRAVEL
This Brochure gives an overview of a project started by Oxford Climate Policy in May 2016, to design and, funding permitting, operationalise the ‘Oxford Crowdfunding for Adaptation’ (OCAD) initiative for corporate air-travel related donations to the Adaptation Fund.
The idea of levying a small charge on air travel to support adaptation efforts in developing countries has been around for over a decade, but it failed to take off as an international instrument. In December 2012, the Adaptation Fund (AF) introduced a ‘Donate’ link on its website, implemented in partnership with the UN Foundation, to receive crowdfunding donations. Following some preliminary research , the OCAD initiative was targeted at corporate air travel, in particular on companies that have, or may be willing to include, climate change as part of their Corporate Social Responsibility (CSR) portfolio, such as companies that offset the emissions caused by their corporate travel.
The initiative is to encourage these target corporates to donate 1 percent of their air travel costs to the Adaptation Fund directly through its existing individual donation facility. It is estimated that a participation of 1 percent of global corporate air travel would yield USD 100 million annually.
25 February 2017
http://www.globalhealthaction.co.uk/climate-change/hope-for-the-best-pre...
The recent elections have had a sobering effect on expectations regarding US federal actions on climate change, although true to form, President-elect Trump seems to be changing positions on the hoof as he trots along.
This blog looks at the likely negative impact of the US elections on American climate finance for developing countries, and looks at how they could be mitigated at least to some degree through sub-national innovative finance.
07 December 2016
Submission to the GCF Board with regards to the Strategy on Accreditation
This submission is in response to the 18 April invitation by the Green Climate Fund (GCF) Secretariat for submission of inputs on the strategy on accreditation in relation to the questions in the report of the Accreditation Committee on the progress on developing a strategy on accreditation.
After examining the current state of affairs, this submission concludes that:
(i) in the longer term, the best limitation strategy is to set a cap on numbers of accredited entities, and
(ii) in the short-term, the most effective way to mitigate the existing imbalances (as well as to incentivise the “signature” Enhanced Direct Access modality) is to grant top priority accreditation to nation-wide entities submitting an EDA pilot proposal.
28 April 2016
Joint Submission to the Green Climate Fund Board
This submission is in response to the request in the Progress Report on the review of the Initial Proposal Approval Process (IPAP) for clear guidance on … what qualifies as a programme (minimum requirements for a programmatic proposal). It suggests that ‘programmes’ should be defined in terms of devolved decision making and the IPAP should be urgently adapted to accommodate such devolved programmes as envisaged in the Terms of Reference for the Enhanced Direct Access Pilot Phase which state that ‘unlike the traditional direct access modality, there will be no submission of individual projects or programmes to the Fund because decision‐making for the funding of specific pilot activities will be devolved to the country level’[Annex I of Decision B.10/04]
10 April 2016
OCP/ecbi mailing on the occasion of the announcement by Quebec Premier Couillard at COP 21 of contributing CA$ 6 million to the Least Developed Countries Fund.
31 December 2015
This brief history of Enhanced Direct Access traces the idea back to a number of historic precursors, such as the Kreditanstalt für Wiederaufbau (KfW under the Marshall Plan, the World Bank Kecamatan Development Program in Indonesia, and the Brazilian Amazon Fund. It then follows how the idea evolved under the Bali Action Plan, the Transitional committee for the design of the Green Climate Fund (GCF) and finally, the GCF Board, culminating in the establishment of a GCF EDA Pilot Phase.
30 December 2015
This Summary Memo explains the benefits of innovative finance, i.e. of earmarking (carbon price related) public sector revenue sources for climate change in general, and for supporting climate change activities in developing countries, in particular.
16 December 2015
Compendium containing
- A Paris Replenishment Cycle for Contributions to the UNFCCC Financial Mechanism
- Procedural Arrangements for the Paris Replenishment Cycle
- Paris Replenishment Cycle: Summary Brief
24 November 2015
An informal roundtable consultation with senior government officials on Consolidation and Devolution of Climate Finance in India took place at the India International Centre, New Delhi, India, on 7 August 2015. The consultation was organised by Oxford Climate Policy and the Indian Keystone Foundation, sponsored by BothEnds and ecbi, and co-facilitated by Rita Sharma, former Secretary to the Government of India, Ministry of Rural Development, and Prodipto Ghosh, former Secretary to the Government of India, Ministry of Environment, Forests and Climate Change.
Among the 23 participants were representatives from the Ministries of Agriculture; of Environment, Forests and Climate Change; of Finance; of Health and Family Welfare; of Rural Development; and of Water Resources. The Deputy Managing Director of the National Bank for Agriculture and Rural Development (NABARD), and the Chief General Manager of the Small Industries Development Bank (SIDBI), two of the designated national implementing entities for the Green Climate Fund (GCF), and the Indian member of the GCF Private Sector Advisory Group, also participated.
The purpose of the meeting was:
i. to discuss national arrangements for climate finance, both at the national and the sub-national level with a particular focus on access by local stakeholders, such as vulnerable communities and Micro, Small and Medium Enterprises (MSMEs);
ii. to discuss developments at the Green Climate Fund (GCF), in particular with regard to Enhanced Direct Access; and
iii. to reach out to government actors who have not been significantly engaged in the climate finance discussions so far, but could play an important role.
Pratim Roy, Director, Keystone Foundation, welcomed participants to the meeting, and following a tour de table, handed over to Rita Sharma, former Secretary, Ministry of Rural Development, who chaired the first session on existing arrangements for climate finance in India.
The discussion was kicked off with a presentation by Anju Sharma, Head of the ecbi Publications and Policy Analysis Unit, summarizing her recent study on Consolidation and Devolution of National Climate Finance: The case of India.
Sharma noted that existing arrangements for climate finance in India were dispersed and fragmentary, and invited participants to consider:
• how existing climate finance sources could work together, to achieve clear and common goals and targets; and
• how they could be made to target better the needs of the poor, and be locally owned and driven.
She pointed to the need for a level of “consolidation without centralization,” accompanied by a strong agenda for “devolution,” while proposing that existing arrangements, for instance for the National Rural Employment Guarantee Scheme that also targets the poor and vulnerable, could also be deployed for climate finance.
There was convergence that some form of consolidation and strategic guidance of climate finance flow at the national level, for instance through a national steering committee, would be helpful. Minimally, such a committee should be tasked with monitoring domestic climate finance flows, analysing their effectiveness, and providing recommendations of how shortcomings could be remedied. It was also mentioned that the effectiveness of such a committee could be increased if it had some resources, say in the form of a National Climate Fund, which would allow it to carry out some of these remedial actions itself.
At the same time, there was general agreement that in order to provide funding for local stakeholders (public or private), there is a need for in-country devolution of decision-making in general, and of project approval, in particular. In other words, it was recognised that local projects need local approvals/intermediation.
The second half of the proceedings focussed on the GCF, and the idea of Enhanced Direct Access (EDA). Ousseynou Nakolima, Director of Country Programming at the GCF, joined the discussion virtually from the GCF headquarters in Songdo, South Korea. After a brief message by Nakoulima on why EDA is of paramount importance for the GCF, Ghosh, who was chairing the session, asked Benito Müller, Director ecbi, to give an introductory presentation.
Müller’s presentation began with a brief history of the idea of EDA, in particular in the context of the GCF. He then presented the latest developments, namely the Terms of Reference (TOR) for an EDA Pilot Phase that had been approved at the most recent GCF Board meeting in Songdo (July 2015). The presentation concluded with summary of an Indian case study of how to engage MSMEs through local intermediation.
In the course of the ensuing discussion, particularly on the EDA TOR, Nakoulima was able to answer directly a number of questions by participants, who also raised a number of issues that may need to be taken into account in the formulation of a call for proposals for the EDA Pilot Phase, such as the issue of how to handle multiple implementing entities applying for a pilot programme, in particular with respect to the national oversight and steering function required in the TOR.
After a round of final statements, Roy closed the meeting by thanking the participants, both physical and virtual, and in particular the two co-facilitators who were key to the success of the meeting, both during and in the run up to it.
17 November 2015
At the tenth meeting of the GCF Board (July 2015), the Accreditation Committee was requested to work on a strategy on accreditation, “examining efficiency, fairness and transparency of the accreditation process, and the extent to which current and future accredited entities will enable the Fund to fulfil its mandate.” This blog argues that for reasons of efficiency and fairness, the strategy will need to pursue two strategic objectives, namely:
- achieving a fair balance between international and direct access entities, and
- ensuring that the GFC is not suffocated by overwhelming numbers of accredited entities.
After examining the current state of affairs, the blog proposes that in the short-term, the most effective way to mitigate the existing imbalances (as well as to incentivise the “signature” Enhanced Direct Access modality) would be to grant top priority accreditation to nation-wide entities submitting an EDA pilot proposal.
17 November 2015
Decision B.11/03 invites observer organizations to make submissions to the GCF Secretariat on the elements contained in paragraph (c) by 1 December 2015. This submission is in response to the element of this paragraph stipulating that the measures to be considered in the GCF Strategic Plan should inter alia focus on ‘ensuring that the GCF is responsive to developing country needs and priorities, while ensuring country ownership, [and] enhancing direct access […]’. With respect to this element, we believe certain ‘architectural’ considerations are absolutely key, in particular the issue of what is to be administered ‘in-house’ and what is to be left to others, or ‘outsourced’.
17 November 2015
On the Virtues of Strategic Divisions of Labour: Some thoughts on strategies for the Green Climate Fund and the Financial Mechanism of the Paris Agreement
It is imperative that the recently launched GCF strategic planning process focus not only on strategic objectives and the like, but also on institutional and governance architecture, and in particular on enhancing complementarity, effectiveness, and efficiency through a division of labour between the GCF as wholesale agent, and other funding entities as specialized retailers, be it in-country (preferably) through Enhanced Direct Access, or through designated international funds, in particular those that will be serving the financial mechanism of the new Paris Agreement.
17 November 2015
DISCUSSION NOTE
The recent OCP/ecbi Concept Note "A Paris Replenishment Cycle for Contributions to the UNFCCC Financial Mechanism" introduces the idea of a joint replenishment of all the funds that are to serve the Financial Mechanism of the new Paris Agreement. This follow-on Discussion Note is meant to provide some input into the discussion of how such a joint replenishment might work.
17 November 2015
Developed country climate finance is generally regarded as quid pro quo for developing country mitigation action, and vice versa. In the Copenhagen Accord, for example, developed countries commit themselves to a goal of mobilizing jointly USD 100 billion dollars a year by 2020 to address the needs of developing countries … in the context of meaningful mitigation actions and transparency on implementation. The latter was provided through developing country ‘Copenhagen pledges’ (Nationally appropriate mitigation actions of developing country Parties).
What could be the equivalent finance quid in Paris for the developing country Intended Nationally Determined mitigation Contributions (INDCs)?
If, following the example of the Copenhagen pledges, the INDCs currently submitted are meant to be one-off occurrences, then some new overall finance goal for 2025/30 might be sufficient. If, however, the (I)NDCs are meant to be part of an enduring contribution cycle then it stands to reason that the ‘finance quid’ needs to have a similar periodic structure. This Concept Note argues that the most pragmatic and effective option for such a periodic finance instrument would be the establishment of a Paris Replenishment Cycle for the UNFCCC Financial Mechanism. This, it is argued, would satisfy many of the long-standing developing country demands, in particular the key demand for more predictability.
05 October 2015
Why national entities submitting an EDA pilot proposal should be prioritized in the GCF Accreditation Strategy
At the tenth meeting of the GCF Board (July 2015), the Accreditation Committee was requested to work on a strategy on accreditation, “examining efficiency, fairness and transparency of the accreditation process, and the extent to which current and future accredited entities will enable the Fund to fulfil its mandate.” This blog argues that for reasons of efficiency and fairness, the strategy will need to pursue two strategic objectives, namely:
1. achieving a fair balance between international and direct access entities, and
2. ensuring that the GFC is not suffocated by overwhelming numbers of accredited entities.
After examining the current state of affairs, the blog proposes that in the short-term, the most effective way to mitigate the existing imbalances (as well as to incentivise the “signature” Enhanced Direct Access modality) would be to grant top priority accreditation to nation-wide entities submitting an EDA pilot proposal.
22 September 2015
The first, and possibly most momentous decision to be adopted on the final day of the tenth Green Climate Fund (GCF) Board meeting (Songdo, 9 July 2015) was the launch of a five year pilot phase on enhanced direct access (EDA Pilot). It was the crowning moment in the (sometimes arduous) three-year process that began with the inclusion of a mandate in the GCF Governing Instrument for the GCF Board to consider additional modalities that further enhance direct access, including through funding entities with a view to enhancing country ownership of projects and programmes.
The EDA Pilot will initially aim to provide up to US$ 200 million for at least ten pilots, including at least four pilots to be implemented in Small Island Developing States, the least developed countries and African States. It will include devolved decision-making to regional, national, and subnational entities and stronger local multi-stakeholder engagement. The decision-making on the specific projects and programmes to be funded will be made at the national or subnational level, and such direct access is a means to increase the level of country ownership over those projects and programmes.
It also requires a National Oversight and Steering Function for country pilots to be overseen and strategically guided at the national level, and envisages engaging local stakeholders through local intermediation. These key requirements on country pilots correspond precisely with the conclusions on what the EDA Pilot should focus on, drawn in the most recent OCP/ecbi publications on the matter:
- "Consolidation and devolution of national climate finance", and
- "Engaging Micro, Small, and Medium Enterprises in developing countries"
(both available on ecbi website)
13 July 2015
OCP/ecbi Think Piece
Having been established more than a decade ago to address the urgent and immediate needs of the Least Developed Countries (LDCs) especially vulnerable to the impact of climate change, the Least Developed Countries Fund for Climate Change (LDCF) still struggles to obtain adequate and predictable funding. The Global Environment Facility, the operating entity of the LDCF, has been unable to program LDCF resources at the level of around US$200 million per year, as proposed in the Programming Strategy for the LDCF.
More generally, this Think Piece by Benito Müller argues, a success at the UN Climate change summit Paris in December will require a significant finance package which is not ad hoc, but rather provides genuine longer-term predictability. In addition to using the proceeds of new international market mechanisms, we think there is also a need to look at innovative sources at the national and sub-national level.
At present, the most promising candidate in this respect is the proposed EU Financial Transaction Tax, aimed to enter into force by the end of the year, with an estimated annual revenue of €37 billion, earmarked for development aid, fighting epidemics and climate change.
However, there are other, sub-national options that need to be explored, in particular where national options are politically unrealistic or insufficient. California could thus decide to use part of the revenue from auctioning allowances for its emission trading scheme. Over the last couple of years this revenue has been steadily increasing to a level (over $1bn in FY14-15) where it might well be politically feasible to use part of it to cover a significant share of the $200 million per annum considered to be the strategic resource requirement of the LDCF.
01 June 2015
What to do about climate finance for the 2020 climate agreement?
30 April 2015
Institutional linkages and relations between the Adaptation Fund and other institutions under the Convention
OCP/ecbi Submission to the Standing Committee on Finance
30 April 2015
Should the Adaptation Fund seek accreditation with the Green Climate Fund?
What should be the role of the Adaptation Fund in the post-2015 climate finance regime? In particular, what should be its relation with the Green Climate Fund? This blog by Benito Müller argues that it makes sense for both the AF and the GCF to harness their complementarities by making the AF the main multilateral “retail outlet” of the GCF for concrete small and micro adaptation projects, particularly under the regular direct access modality, as pioneered by the AF. For this to happen, the AF Board must (i) become an accredited intermediary (‘funding entity’) of the GCF, and (ii) arrange a ‘complementarity MOU’ with the GCF.
23 April 2015
Abstract: OCP/ecbi CONCEPT NOTE
A great deal of confusion has resulted from the fact that it has hitherto not been possible for the GCF Board to agree on definitions for some of the key nouns referred to in the GCF Governing Instrument in the context of who can access GCF funding. This Concept Note by Benito Müller proposes the following very simple definitions in terms of the GCF accreditation categories:
• Implementing Entity (IE): an entity accredited by the GCF to access GCF funding.
• Project Implementing Entity (PIE): an IE accredited for project management.
• Funding Entity (FE): an IE accredited to award grants and/or allocate funding.
• Financial Intermediary (FI): an IE accredited for on-lending and/or blending.
• Intermediary: an FE and/or FI.
17 April 2015
Consolidation for devolution: Balancing top-down and bottom-up elements of climate finance governance in India
Consolidating national and international climate finance in a national fund in India could help ensure a common vision and principles; coherence with national strategies; distributive justice; prioritisation of the needs of the most vulnerable; balance between adaptation and mitigation; and continuous review, to enable course corrections when necessary. However, this consolidation must come with a strong commitment to devolution.
13 April 2015
ecbi Policy Brief, March 2015
National and international finance is increasingly becoming available in developing countries to address climate change for both mitigation and adaptation. However, existing (domestic) arrangements for climate finance are often dispersed and fragmentary, and lack clear goals and strategies, therefore allowing for neither efficiency nor accountability.
This paper examines the governance arrangements for climate finance in India, and proposes the creation of an Indian National Climate Fund to pool climate finance from different national and international sources, to channel it to the State and local levels.
The Fund should seek to “consolidate without centralisation”, and to devolve decision-making on the use of climate finance to local governments. In addition to defining a common vision and principles for climate finance, such a National Funding Entity should aim for coherence with national development goals strategies, and integration across sectors; distributive justice, to ensure that climate finance reaches those who need it most, and that their needs are prioritised; and a balance between different thematic areas (such as mitigation, adaptation, capacity building etc.). It should also review progress continuously, and make mid-course corrections where necessary.
17 March 2015
What is the future of adaptation financing under a new global climate agreement and beyond the UNFCCC? What role will an actor such as the Kyoto Protocol Adaptation Fund, which strengthened country ownership by pioneering direct access, play as a result of ongoing efforts to rationalize the global climate finance architecture with the full operationalization of the Green Climate Fund (GCF) as a new major player?
These are some of the questions that were put to the participants of a discussion meeting convened by the Heinrich Boell Foundation North America and the European Capacity Building Initiative (ecbi) on 7 December 2014 (during UN Climate Conference in Lima/Peru). The conversation was kicked off with a short presentation by Benito Mueller on the future of the Adaptation Fund (available at http://www.eurocapacity.org/public/chronicle.shtml).
This meeting report was produced jointly by the Heinrich Boell Foundation and Oxford Climate Policy, on behalf of ecbi.
07 March 2015
Engaging Micro, Small, and Medium Enterprises in developing countries: Enhanced Direct Access and the GCF Private Sector Facility
On 5 March, the Green Climate Fund (GCF) Secretariat published a Board Paper and Draft Decision on ‘Additional Modalities that Further Enhance Direct Access: Terms of Reference for a Pilot Phase,’ putting forward recommendations to the GCF Board on how to operationalise the ‘Enhanced Direct Access Pilot Phase’, which was agreed during the last Board meeting that took place in Barbados in October 2014. The Draft Decision is ‘to launch a Request for Proposal to countries through their national designated authority or focal point and public media to competitively select subnational, national, public and private entities for the implementation of 5 pilots with a total of US$ 100 million, including at least 2 pilots to be implemented in small island developing States, the least developed countries and African States’.
Given that engaging local Micro, Small, and Medium Enterprises (MSMEs) at scale is critical to achieving sustainable low carbon growth in developing countries, this OCP/ecbi Working Paper puts forward a proposal for testing different nationally determined models of an in-country nationally consolidated and guided, but domestically devolved funding architecture for MSMEs under the Pilot Phase.
The key elements of this proposal are:
(i) to consolidate foreign and national public sector finance in a national gateway (‘National Funding Entity’), such as a national climate fund or, in the absence thereof, the Ministry of Finance to serve, inter alia, as GCF Intermediary;
(ii) to select a national body (e.g. the national climate committee) representing all key stakeholders – the relevant line ministries, the NDA, civil society, private sector etc. – to give strategic guidance to the national EDAPP programme.
(iii) to use existing channels (such as local branch networks of national development banks) to disperse the funding through local intermediation, where local intermediaries (branches) are given the power to approve eligible MSME projects under the national EDAPP programme.
In addition to discussing these key elements in some detail, the Working Paper illustrates how the GCF Private Sector Facility could use the EDAPP to fulfil one of its core mandate, viz. to ‘promote the participation of private sector actors in developing countries, in particular local actors, including small- and medium-sized enterprises and local financial intermediaries.’[GCF Governing Instrument, paragraph 43]
The Working Paper also presents two examples of how local banks are currently used as intermediaries for funding developing country MSME mitigation projects:
• The Sustainable Use of Natural Resources and Energy Financing framework, funded and managed by the French development agency AFD, under which local banks are used as intermediaries for the provision of concessional loans and (ex ante) investment grants to MSME renewable energy and energy efficiency projects (in industry, agriculture and buildings).
• The GEF funded Indian MSME Energy Efficiency Project, managed by the Indian Bureau of Energy Efficiency (BEE), and the Small Industries Development Bank of India (SIDBI). The project provides (ex post) performance linked grants through local SIDBI branches to incentivize energy efficiency improvements in (energy intensive) MSMEs.
These examples not only demonstrate in practical terms how a local intermediation can be done, but also that it very efficient and effective and most likely the only way to mobilise local MSMEs at the required scale.
07 March 2015
On 17 December, an OCP blog on GCF Direct Access Accreditation: A Simple Strategy was published by Benito Müller. It proposes a very simple two-element accreditation strategy for direct access to the GCF:
[1] Introduce a time limit of five years on accreditations (for all entities), with the possibility of renewal, depending on re-nomination by the recipient country and GCF Board approval.
[2] Limit the number of entities that can access the GCF directly to one or two per recipient country.
19 December 2014
Country (Adaptation) Funding Needs in the GCF: Operationalising the ‘Country Needs’ Investment Option
Submission to the GCF Investment Committee
24 November 2014
In their Scenario Note on the sixth part of the second session of the Ad Hoc Working Group on the Durban Platform for Enhanced Action (ADP), the ADP Co-chairs emphasized that “it is essential to use the October session to make significant progress in clarifying and advancing the content of the 2015 agreement, to build bridges and to work together on outstanding issues. In particular, it will be important in the October session, to further clarify and flesh out the operational aspects of the agreement. Key challenges that will need focussed attention in our work include: deepening the understanding on the longer-term cycle of contributions/commitments, including its periodicity (length) and the functions of the steps proposed, such as any periodical consideration or assessment and review”
This ecbi/OCP Concept Note introduces the idea of a Dynamic Contribution Cycle as a contribution to the debate on these issues.
17 October 2014
International equity/distributive justice (a fair share for each recipient country) and global efficiency (biggest global bang for the buck) provided the bang in question is well defined for all the relevant activities are both legitimate resource allocation objectives that need to be addressed.
Generally, efficiency and equity cannot be achieved simultaneously through a single allocation which is why the proposed way forward is to deal with the two objectives in separate allocations, whereby each funding envelope is divided into two (not necessarily equal) sub-envelopes: one guided purely by efficiency, and the other purely by equity considerations. The exact nature of the allocation methods in the two sub-envelopes and their relative size will depend on the funding theme.
This Submission focuses on the allocation of adaptation resources in the context of taking account of recipient country needs. While it is possible to estimate adaptation funding needs of countries, it is not straightforward, if at all possible, to compare adaptation activities with respect to their cost-effectiveness: there is no globally comparable 'bang' in this context. This is why adaptation resources should be allocated principally in proportion to adaptation funding needs (in conjunction with the basic floor allocations)
19 August 2014
A Legal Note which considers the legal options for creating such a space for Quantified Emission Limitation and Reduction Obligations (QELROs) in the Paris Agreement. In particular, it explores the legal feasibility of having an annex to a Treaty/Protocol where Parties could inscribe targets which would automatically become legally binding.
30 May 2014
This Legal Note explores the options for establishing such a Southern Solidarity Fund as a separate, ring-fenced funding entity operated by the GCF.
30 May 2014
This Concept Note introduces the idea of a Southern Solidarity Fund, to be operated by the Green Climate Fund, which would allow solidarity contributions to climate finance by developing countries as part of South-South collaboration
11 April 2014
The Board of the Green Climate Fund (GCF) is currently in the process of designing “access modalities” as part of the fundamental Fund architecture. Over the last few months, the focus of this exercise has slowly but significantly turned towards the idea of “Enhanced Direct Access” (EDA) through “Funding Entities” (FEs) ? as envisaged in paragraph 47 of the GCF Governing Instrument (GI). This idea is by no means new.2 Indeed there exists a considerable literature considerable on the topic, but it was only at the most recent GCF Board meeting in Nusa Dua, Indonesia, that the idea was given centre stage in a workshop on “Country Ownership and Enhancing Direct Access” organised by the Indonesian host of the meeting.
The aim of this Guide is to provide a rough idea of what this Enhanced Direct Access modality is meant to be and how it relates to some of the other, more traditional modalities and approaches such as the “Programmatic Approach”. As such it is meant to be complementary to the recent ecbi Policy Brief on “Devolved Access Modalities"
02 April 2014
Topic:
A Rough Guide to Enhanced Direct Access
The Green Climate Fund (GCF) Board is in the process of considering additional modalities that further
enhance direct access, including through funding entities with a view to enhancing country ownership of projects and programmes.1 The term ‘enhancing’ in this context refers to a devolution by the Board of certain operational
funding decisions to outside agencies: ‘(accredited) funding entities’.2 This type of devolved/decentralized access modality has been proposed as an alternative to the more traditional model where detailed project approval is carried out at the multilateral level (e.g. by the Global Environment Facility Council/ Secretariat, or the Adaptation Fund Board). It has been argued that this sort of decentralized/ devolved model is key to the GCF being able to operate at scale,3 but it is also clear that it could give rise to a fundamental tension in the partnership between the GCF and these accredited funding entities, in that they each may well have different objectives, say with regards to national development and global climate change benefits.
02 April 2014
Topic:
Devolved Access Modalities
This discussion note discusses some of the contentious issues around the Green Climate Fund negotiations and proposes that, in the case of mitigation funding, two separate funding envelopes/streams should be introduced: one dedicated to efficiency and the other to (intra-generational) equity. In the case of adaptation funding, resources should be allocated in proportion to country adaptation funding needs. For example, estimated in terms of the number of people exposed to climate change impacts and the intensity of these impacts (their “vulnerability”). This should be carried out separately with respect to the funding set aside for particularly vulnerable countries, and to the funding for the other countries.
21 March 2014
Topic:
GCF, Adaptation, Mitigation, cap
Pre-GCF Board Meeting Luncheon Discussion on Country Ownership and Enhancing Direct Access Hosted by the Ministry of Finance of the Republic of Indonesia on 17 February 2014 in Nusa Dua, Bali
18 February 2014
Topic:
GCF, Enhanced Direct Access
Pre-GCF Board Meeting Luncheon Discussion on Country Ownership and Enhancing Direct Access
Hosted by the Ministry of Finance of the Republic of Indonesia on 17 February 2014 in Nusa Dua, Bali
18 February 2014
Topic:
GCF, Enhanced Direct Access
Pre-GCF Board Meeting Luncheon Discussion on Country Ownership and Enhancing Direct Access
Hosted by the Ministry of Finance of the Republic of Indonesia on 17 February 2014 in Nusa Dua, Bali
18 February 2014
Topic:
GCF, Enhanced Direct Access
Pre-GCF Board Meeting Luncheon Discussion on Country Ownership and Enhancing Direct Access
Hosted by the Ministry of Finance of the Republic of Indonesia on 17 February 2014 in Nusa Dua, Bali
18 February 2014
Topic:
GCF, Enhanced Direct Access
Pre-GCF Board Meeting Luncheon Discussion on Country Ownership and Enhancing Direct Access
Hosted by the Ministry of Finance of the Republic of Indonesia on 17 February 2014 in Nusa Dua, Bali
18 February 2014
Topic:
GCF, Enhanced Direct Access
Review Note on background paper GCF/B.06/05 for the Sixth Meeting of the Green Climate Fund Board
18 February 2014
Topic:
GCF, Resource Allocation
In about a week’s time, the Green Climate Fund Board will meet in Bali to continue discussions on the design of what could be a radical new global fund. This will be a critical meeting – it will decide whether the GCF Board chooses to be radical in order to be effective, or simply opt for the easy, same old International Financial Institution (IFI) business-as-usual model of “doesn’t really work, but we’re afraid of transformational change”.
12 February 2014
Topic:
Green Climate Fund Board, Bali
The Green Climate Fund (GCF) was launched in late 2013 and is set to play a key role in disbursing some of the $100 billion per year pledged to flow annually to developing countries by 2020 in support of climate action. A key question for the GCF Board concerns the rules for allocating its funds, as Benito Muller, Managing Director of Oxford Climate Policy, explains.
24 January 2014
Topic:
GCF, Resource Allocation
This OIES Energy and Environment Working Paper is the third and final study on resource allocation which Benito Müller has been engaged in over the past year – the previous papers being on the Allocation of (Adaptation) Resources: (September 2013) and on Quantity Performance Payment by Results: (July 2013). This Working Paper looks at the lessons to be learned, in particular for the Green Climate Fund, from the Performance-Based Allocation (PBA) system of the World Bank’s International Development Association (IDA), and the Resource Allocation Framework (RAF) as well as the System for Transparent Allocation of Resources (STAR) of the Global environment Facility (GEF).
17 January 2014
Topic:
Resource Allocation, GCF
The Green Climate Fund is at a crossroads where it must choose between the traditional centralized or a novel devolved decision making model. The next meeting of the GCF in February will be key as it will for the first time be explicitly discussing enhanced direct access through (national) funding entities which has devolution of decision making as its corner stone. This Discussion Note by Benito Müller takes stock of the deliberations on direct access and the correlated issue of country ownership, and considers how these issues should be taken forward at the February meeting.
17 January 2014
Topic:
GCF, Enhanced direct Access, Country Own
Preliminary Thoughts
04 December 2013
Open letter by Benito Müller to the Green Climate Fund Board and supporters of enhanced/devolved access in the wake of the recent Paris Board meeting.
"Paradigm shifts" are very often referred to in GCF parlance, but mostly in the context of low-emission and climate-resilient pathways. However, if the GCF is to achieve its objectives, it is argued, then "same old, same old" finance paradigm will also not suffice.
http://jusharma.wordpress.com/2013/10/30/same-old-same-old-too-late-for-...
30 October 2013
Topic:
GCF
Enhanced (Direct) Access for the GCF Business Model Framework
Presented at the AfDB Consultation on African Perspectives on the Green Climate Fund (GCF) 26-27 September 2013, Sheraton Hotels, Tunis, Tunisia
11 October 2013
Topic:
Enhanced Direct Access
This OIES Energy and Environment Brief looks at lessons from fiscal transfer mechanisms, i.e. instruments used to allocate central tax revenue to sub-national governments, for the allocation of (adaptation) resources by the Green Climate Fund.
16 September 2013
Topic:
Resource Allocation, Adaptation, GCF
Submission to the Standing Committee on Finance for its fifth meeting (SCF5). It focuses on Modalities 'by which a particular funding decision may be reconsidered in light of [the] policies, programme priorities and eligibility criteria established by the COP', as required by Article 11.3.b of the Convention. Exploring the debate around Modalities and puts forward a pragmatic proposal for compromise.
23 August 2013
Topic:
Modalities, SCF
At the 16th Conference of the Parties (COP) in 2010, developed countries formalised a collective climate finance commitment made previously in Copenhagen of “mobilising jointly USD 100 billion per year by 2020 to address the needs of developing countries...from a wide variety of sources, public and private, bilateral and multilateral, including alternative sources” (UNFCCC, 2010). However, there is currently no definition of which “climate” activities, flows, or other interventions could count towards the USD 100 billion; what “mobilising” means; or even which countries are covered by this commitment.
At present, official systems in place to track climate finance mainly focus on public outflows from developed countries. The greatest uncertainties relate to private and South-South flows to developing countries as well as domestic flows.
This paper focuses on the issue of private climate finance mobilised by developed countries in the context of the USD 100 billion commitment. It examines different definitions used by actors to quantify the level of private climate finance mobilised by their interventions, as well as the methods used to track private climate finance.
20 July 2013
Topic:
climate flows, finance, definition, mobi
Quantity Performance Payment by Results: Operationalizing enhanced direct access for mitigation at the Green Climate Fund
This OIES Research Paper by Benito Müller, Samuel Fankhauser, and Maya Forstater looks at the possibility of using Quantity Performance (QP) instruments for 'wholesale' mitigation funding through enhanced direct access to the Green Climate Fund (GCF)
The Paper carries out an evaluation of such instruments in this context with respect to three key objectives of the GCF, namely, to promote a paradigm shift towards low-emission and climate-resilient development pathways, to achieve economic efficiency in directly securing emission reductions at cost, and to support equity in the distribution of resources. Based on this evaluation, the paper concludes that QP instruments can be used in conformity with these objectives, provided they are used as a complement to other funding instruments.
It ends by putting forward two examples of how QP instruments could be used in such a 'wholesale' fashion
08 July 2013
Topic:
GCF, Enhanced Direct Access, Quantity Pe
in Local actors are ready to act: 6 views on how the Green Climate Fund could reach them Both Ends
01 July 2013
Submission to the UNFCCC Standing Committee on Finance (SCF) for its fourth meeting on 15-17 June in Bonn, Germany.
The focus of the recent SC meeting in Bonn was to draft the text for the arrangements between the UNFCCC Conference of Parties and the Green Climate Fund. This submission by the Oxford Institute for Energy Studies looks at the question that ultimately proved to be most controversial: What does it mean for an Operating Entity of the UNFCCC Financial Mechanism to be accountable to the COP, and how does this relate to operationalizing Art. 11.3 (b)?
21 June 2013
Topic:
Standing Committee, Green Climate Fund,
CDKN Policy Brief
01 June 2013
Web Link:
https://germanwatch.org/de/download/7992.pdf
Information Note on the Green Climate Fund Business Model Framework The Governing Instrument of the Green Climate Fund stipulates: The Board will consider additional modalities that further enhance direct access, including through funding entities with a view to enhancing country ownership of projects and programmes. Unfortunately, it does not elaborate further either on the concept of ‘enhanced direct access’ nor on the notion of a ‘funding entity’. The aim of this note is to fill this semantic lacuna, and give a brief overview of a concrete example of the latter.
06 May 2013
Topic:
Enhanced Direct Access, National Funding
Submission to the GCF on the Business Model Framework OIES Submission to the GCF
01 March 2013
A Delhi Vision for the Green Climate Fund Business Model Framework – Some Thoughts on Access and Disbursement
Oxford Energy and Environment Brief
February 2013
At the second meeting of the Green Climate Fund (GCF) Board in October 2012, India announced they would prepare a submission with regards to the Board deliberations on a business model for the GCF. A consultation meeting was held in New Delhi on 15-16 February 2013 for which Benito Müller (Director Energy and Environment, OIES) was asked to contribute one of three background papers, focussing on access modalities and disbursement instruments. This Oxford Energy and Environment Brief is based on this background paper.
20 February 2013
Topic:
Green Climate Fund, Enhanced Direct Acce
04 September 2012
Topic:
MRV of financial support
04 September 2012
Topic:
Quantity Performance Instruments
Subcomponent 8 - Finance Final Reports and Annexes Ministry of Environment and Mineral Resources and Ministry of Finance
25 August 2012
29 May 2012
Topic:
Climate Investment Funds
11 May 2012
Topic:
Finance sources: LDC Press Release
12 August 2011
Topic:
Standing Committee
10 July 2011
Topic:
Transitional Committee
09 June 2011
Topic:
Innovative Financing
19 May 2011
Topic:
Transitional Committee
Speaking Notes for the ecbi Finance Circle Dinner with Transitional Committee members in Mexico City, 28 April 2011
29 April 2011
Topic:
First Transitional Committee Meeting
13 April 2011
Topic:
Transitional Committee
Solidarity Levies on Air Travel: The case for a ready-made innovative stream of finance in support of the current international climate negotiations
29 March 2011
Topic:
Short-term Innovative Finance
07 March 2011
Topic:
Gree Climate Fund
05 March 2011
Topic:
Cancun Analyses
What needs to be done for Durban (COP 17) Oxford Energy and Environment Brief
25 February 2011
18 February 2011
Topic:
Payment Terms: Loans
14 February 2011
Topic:
Transitional Committee
08 February 2011
Topic:
Cancun
05 February 2011
Topic:
Sources
What to do now? Elements for organizing the Transitional Committee to establish the Green Climate Fund, based on lessons learned from the Global Fund experience
21 January 2011
Topic:
Transitional Committee
09 January 2011
Topic:
governance
05 December 2010
Topic:
Follow up on Cancun FC meeting
30 November 2010
Topic:
Follow up on Cancun FC meeting
17 November 2010
Topic:
delivery of finance
17 November 2010
Topic:
governance
What after Tianjin, and how? European Climate Platform (ECP) Background Paper
31 October 2010
Some thoughts put together by the 2010 ecbi Fellowship ecbi Report
31 October 2010
30 October 2010
Topic:
governance
National Funding Entities: Their role in the transition to a new paradigm of global cooperation on climate change
30 October 2010
Topic:
governance
Why Reinvent the Wheel? On establishing new funds while guiding and holding accountable operating entities of the UNFCCC financial mechanism
30 September 2010
Topic:
governance
The Adaptation Fund Board Approves Financing for Projects, Operationalizes the Direct Access Modality
23 September 2010
Topic:
Library contribution
06 September 2010
Topic:
Geneva Dialogue on Climate Finance
06 September 2010
Topic:
delivery of finance
04 September 2010
Topic:
governance
26 July 2010
Topic:
delivery of finance
25 July 2010
Topic:
governance
23 July 2010
Topic:
public v.private sector funding
A post-Copenhagen synopsis ecbi Policy Brief
25 June 2010
Post Copenhagen - Architecture and Governance ecbi Policy Brief
01 May 2010
Part II The Question of Oversight, Post Copenhagen Synthesis Report ecbi Policy Brief
01 April 2010
Renegotiating the role of civil society in the governance of climate finance OIES EV 50
01 April 2010
Adaptation Quick Start Funding at the Cross Roads Oxford Energy and Environment Comment
31 March 2010
Oversight of compliance with financial commitments under the UN Framework Convention on Climate Change Oxford Energy and Environment Comment
31 December 2009
Devolution of funding decisions to designated national/regional climate change funding entities Oxford Energy and Environment Comment
01 December 2009
The debate on institutional arrangements for climate finance Oxford Energy and Environment Comment
12 October 2009
Proceedings of the 2009 Oxford Fellowship and Seminar ecbi Report
12 September 2009
10 August 2009
Architecture at gouvernance ecbi note de politique generale
10 June 2009
10 April 2009
The debate on existing institutions in climate finance Oxford Energy and Environment Comment
31 January 2009
A far-reaching debate on the use of auction revenue from (EU) Emissions Trading.
10 November 2008
