The Green Climate Fund August 2017 Opportunity for building awareness of the GCF and explore the opportunities potentially available to all stakeholders.

Overview Part I: The GCF Part II: NDAs and focal points Part III: Getting ready Part IV: Projects and programmes Part V: GCF portfolio Part VI: Accreditation Introduction

Part I: The GCF

GCF business model

GCF resources ~USD 80 million for Readiness support USD 10.3 billion in pledges USD 10.1 billion in signed contributions 50/50 split between adaptation & mitigation Geographical balance 50% of adaptation resources for SIDS, LDCs and African States ~USD 80 million for Readiness support USD 40 million for Project Preparation The Fund aims for a 50:50 balance between mitigation and adaptation investments over time. It also aims for a floor of 50% of the adaptation allocation for particularly vulnerable countries, including Least Developed Countries (LDCs), Small Island Developing States (SIDS), and African States. There is funding allocated to Readiness and Project Preparation activities: Initial USD 30 million from 2014-2016, with up to an additional USD 50 million approved by the GCF Board in Dec 2016 to scale up efforts (~USD 80 million in total). Project preparation funding with USD 40 million allocated for project development. Important to note that Readiness and Project Preparation Funding initiatives are approved by the Secretariat. Note that all full project funding proposals must be approved by the GCF Board. As of 31 July 2017

Characteristics of GCF Country ownership through NDAs and focal points Balance between adaptation and mitigation Equal voice for developed and developing countries Diversity of accredited entities Diversity of financial instruments Dedicated Private Sector Facility (PSF) Largest dedicated climate fund globally Many of the features of the Fund are unique Be it its scale, or its diversity of partners & financial tools Balanced governance Focus on adaptation particularly for vulnerable countries like SIDS Ability to work with the private sector, and Strong ethos of empowering countries These features set the Fund apart from other funds and financing institutions in the climate finance space

NDAs & focal points – Country Ownership Part II: NDAs & focal points – Country Ownership

Roles of NDAs & focal points NDA play an important role in the Fund’s operations to ensure country ownership: Strategic alignment with country priorities for “low emission and high resilient sustainable development” Identify entities to work with, and even nominate direct access entities Approve projects before the Fund considers it through no-objection procedure Also approve deployment of readiness support available

Country ownership guidelines Adopted by the Board at its seventeenth meeting in July 2017, the guidelines: Emphasize the importance of the country programming process in defining long-term engagement with GCF. Underscore the centrality of country ownership as a core principle of GCF. Reaffirm countries’ role in driving forward its relationship with the Fund, together with relevant stakeholders. Include suggestions for countries to consider when engaging with the Fund across all GCF operational modalities, e.g. accreditation, Readiness. At its 17th Meeting (June 2017) the Board adopted guidelines for enhanced country ownership and country drivenness and requested NDAs, focal points, accredited entities, delivery partners, and the Secretariat to follow the guidelines in carrying out its activities with the Fund. The guidelines emphasize the importance of the country programming process and the opportunities it can bring about to strengthen country ownership and multi-stakeholder consultation in defining long-term engagement with the Fund. Underscore the centrality of country ownership as a core principle of GCF and reaffirms countries’ role in driving forward its relationship with the Fund, together with relevant stakeholders. Include suggestions for countries to consider when engaging with the Fund across all GCF operational modalities such as accreditation, Readiness and preparatory support, and funding proposal development, including the no-objection procedure. The Board requested the Secretariat to assess annually how the guidelines are being applied and to improve them based on lessons learned and observed best practices. The Board will review the guidelines as needed, or at least every two years.

GCF programming Efforts kick started with the Strategic Plan which outlined an ambition to gather knowledge on demand from the ground in terms of country priorities and potential for GCF involvement.

Country and Entity Programmes GCF programming Overview INDCs NAPs TNAs Country and Entity Programmes GCF pipelines PPF READINESS FP Starting with national context and policies (INDCs, NAPs, TNAs) that articulate adaptation and mitigation needs GCF funding to enable development of these needs, articulated in GCF pipelines, programming priorities, and some may need readiness, PPF, or go straight to FPs GCF programming equals a series of steps and modalities to help channel this process further

Programming continuum Country programmes Country’s GCF priorities Led by NDA/focal point Stakeholder engagement Entity work programmes Responds to country priorities Identifies regional or multi-country initiatives Pipelines Projects/programmes developed for funding Aligned with country/ entity programmes

Project implementation Iterative process Country programme Entity programme Pipeline development Funding proposals Project implementation Results & learning

Key elements Country’s development & climate change context Priority areas for GCF programming Project preparation & readiness needs Alignment with GCF policies Roles of stakeholders, particularly entities Complementary support Monitoring & updates

Part III: Getting ready… Readiness Programme

Four areas of support NDA strengthening Strategic frameworks Support for direct access entities Adaptation planning processes The GCF Readiness programme is a funding programme to enhance country ownership and access to the Fund. It provides resources for strengthening the institutional capacities of National Designated Authorities (NDAs) or focal points and direct access entities to effectively engage with the Fund. It also assists countries in undertaking adaptation planning and developing strategic frameworks to build their programming with the GCF Resources may be provided in the form of grants or technical assistance. All developing countries can access the Readiness programme, and the Fund aims to ensure that at least 50 per cent of the readiness support available goes to particularly vulnerable countries, including least developed countries (LDCs), small island developing States (SIDS), and African States. Four main areas of support under the GCF Readiness Programme: 1. NDA strengthening: Supports ability of the NDA to perform its function. Consultations, establish No-Objection procedure, outreach and awareness raising, etc. 2. Strategic Frameworks: Supports consultative mechanism to underpin solid Country Programme and pipeline development, relevant policy review to support strategic engagement and harmonization with National development plans and resources. 3. Support for direct access: Accreditation, gap assessments, building capacity of direct access entities to support Country Programmes. 4. Adaptation Processes: NAP development, adaption planning processes – template for application still be refined but you can access already under current generic Readiness template.

Readiness funding NDA strengthening Support for direct access entities cap per country per year USD 1 million NDA strengthening Support for direct access entities Strategic frameworks, including country programmes, concept notes, pre-feasibility studies cap per country (not per year) USD 3 million National adaptation plans (NAP) and / or other adaptation planning processes As stated earlier GCF has made an initial sum of up to USD 80 million available to support readiness activities in countries. Each area has a funding cap as outlined. There are no restrictions on the number of proposals that can be submitted, just caps on total or total access in one year. Of the USD 1 million annual country cap, there is a USD 300,000 limit to help establish or strengthen a NDA or focal point to deliver on the Fund’s requirements, and within that amount a maximum of USD 100,000 can be used for NDA-led stakeholder meetings.

Access modalities Direct Delivery partner NDAs or focal points To support core GCF functions USD 300K per year Delivery partner International, regional, national, sub-national All areas Subject to caps above

118 approved for USD 38.5 million Programme overview Portfolio 118 approved for USD 38.5 million EASTERN EUROPE 5 approved (USD 1.5m, 5 countries) 3 disbursed (USD 375K, 3 counties) ASIA-PACIFIC 38 approved (USD 15m, 24 countries) 23 disbursed (USD 3.4m, 16 countries) LATIN AMERICA & the CARIBBEAN 32 approved (USD 8.7m, 24 countries) 13 disbursed (USD 1.3m, 9 countries) AFRICA 43 approved (USD 13.3m, 34 countries) 27 disbursed (USD 4.2m, 25 countries) 118 proposals approved: 87 countries (60 countries - SIDS, Africa and LDCs) – USD 38.5 million in commitments 89 have completed legal arrangements either in the form of a bilateral grant agreement or are under the framework agreement with the multilateral agencies 66 proposals disbursed – 53 countries (9.3 million) As of 31 July 2017

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 To assist countries develop projects, in addition to Readiness funding (which we will explain further shortly) they can get project preparation funding for up to 10% of the total project cost or USD 1.5 million, which ever is the lesser. The Executive Director of the Fund has the decision making power on PPF proposals so these do not need to go to the Board for approval normally. Secretariat assesses concept against investment criteria What is assessed? Also assesses request for justification of needs & GCF policies GCF Executive Director approves request

PPF State of Play 24 PPF requests officially submitted Covering 39 countries 11 requests are from direct access entities 3 requests approved or endorsed EASTERN EUROPE LATIN AMERICA & the CARIBBEAN ASIA-PACIFIC AFRICA

Part IV: Projects & programmes

Terms determined on a case-by-case basis Financial Instruments 1 Terms determined on a case-by-case basis 2 Equity 3 Grants Guarantees 4 Fund has the ability to deploy 4 types of financial instruments – grants, equity, guarantees and loans Grants with/without repayment contingency Loans with high concessionality – 40 years maturity, 10 years grace, 0% interest Loans with low concessionality – 20 years maturity, 5 years grace, 0.75% interest Other non-grant instruments terms determined on a case-by-case basis On what basis are terms decided? - Private sector as a key stakeholder for climate action in different sectors and developing financial instruments to link this sector is one of the priorities for the fund Concessional loans

Size of project/activity within a programme Total Projected Costs* * At the time of application, irrespective of the portion that is funded by the Fund and, if applicable, other sources, for an individual project or activity within a programme. 16

8 Strategic Results Areas With a focus on… Impacts Paradigm-shift potential Crosscutting adaptation-mitigation benefits Sustainable development co-benefits 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

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 Long-term impact beyond a one-off investment Wider economic, environmental, social (gender) co-benefits Country ownership and capacity to implement (policies, climate strategies and institutions) Six high-level investment criteria of the Fund… These form the high-level filter for assessing funding proposals Economic and, if appropriate, financial soundness, as well as cost-effectiveness and co-financing for mitigation Vulnerability and financing needs of beneficiary in targeted group

54 entities accredited to date A Diverse Network of Partners Morocco Indonesia Korea Rwanda India Peru Namibia South Africa Kenya Ethiopia Mongolia China Argentina Morocco India Senegal Bangladesh At its last meeting (July 2017), the Board accredited six new organizations, bringing the total number of GCF Accredited Entities to 54, of which 27 are direct access. The new entities are: - CDG Capital S.A. (CDG Capital ), Morocco (direct access) - Infrastructure Development Company Limited (IDCOL) , Bangladesh (direct access) - Small Industries Development Bank of India (SIDBI) , India (direct access) - Micronesia Conservation Trust (MCT) , Federated States of Micronesia (direct access) - Japan International Cooperation Agency (JICA) , headquartered in Japan (int’l access) - Bank of Tokyo-Mitsubishi UFJ, Ltd. (BTMU) , headquartered in Japan (int’l access) 54 entities accredited to date As of 31 July 2017

Project approval process GCF Proposal Approval Process

Technical Advisory Panel Project approval process Legal arrangements Accredited Entity Secretariat GCF Board Concept note (optional) Generation of Project idea Submission of funding proposal No-objection Analysis and recommendation Board Decision NDA Technical Advisory Panel Trustee 1 6 2 3 Possible request for Readiness support by NDA Possible support from Project Preparation Facility to AE 4 5 Based on Board decision B.07/03

Private Sector Facility To mainstream climate change mitigation and adaptation actions in the private sector Why the PSF? Fund climate risk assessment models and tools Long-term debt, credit lines Equity to develop a project to full bankability Guarantees to bear specific risks Possible interventions Accredited entities with private sector operations Present funding proposals spontaneously or in response to calls for proposals Access to the private sector Say a word about the private sector facility Why was it created? Recognition that addressing the climate change challenge at scale will require mainstreaming climate action into the day-to-day business of the private sector Variety of ways to do it Develop the tools to help them integrate climate risk into their business models Provide debt of varying forms to incentivize private sector actors – long-term, liquidity, or refinancing Equity to take early stage risks, and guarantees to cover specific risks How can private sector access? Integrated into the Fund using the same operational modalities Bring forward proposals through any of the accredited entities with the ability to undertake private sector operations

Part V: GCF portfolio

A growing portfolio $2.2b for 43 projects in 64 countries Serbia Georgia Mongolia Armenia Uzbekistan Moldova Tajikistan Tunisia Jordan Morocco Egypt Pakistan Mexico Eastern Caribbean Bangladesh Senegal Mali India Viet Nam El Salvador Gambia Nigeria Sri Lanka The total portfolio of approved projects to date is USD 2.2 billion of GCF financing through 43 projects in 64 countries, globally [NOTE: NOT ALL COUNTRIES FEATURED ON MAP… Several regional programmes: GEEREF NeXT (Approved April 2017): Africa & MENA (Comoros, Democratic Republic of Congo, Equatorial Guinea, Ivory Coast, Kenya, Madagascar, Mauritius, South Africa, Togo, Uganda and Jordan); LAC (Bahamas, Barbados, Belize, Brazil, Chile, Costa Rica, Dominica, Dominican Republic, Grenada, Guatemala, Guyana, Haiti, Mexico, Saint Kitts and Nevis, Saint Vincent and the Grenadines, Suriname and Uruguay); Eastern Europe (Georgia); and Asia-Pacific (PNG) Pacific Islands Renewable Energy Investment Programme (Approved December 2016): Cook Islands, Tonga, Republic of Marshall Islands, Federated States of Micronesia, Papua New Guinea, Nauru and Samoa (note only Cook Islands included in funding decision – 17M) Africa Universal Green Energy Access Programme (Approved October 2016): Benin, Kenya, Namibia, Nigeria and Tanzania GCF-EBRD Sustainable Energy Financing Facilities (Approved October 2016): Armenia, Egypt, Georgia, Jordan, Moldova, Mongolia, Morocco, Serbia, Tajikistan, Tunisia Caribbean Sustainable Energy Facility (Approved October 2016): Dominica, Grenada, Saint Kitts & Nevis, Saint Lucia, and Saint Vincent & Grenadines East Africa KawiSafi Ventures Fund (Approved November 2015): Kenya, Rwanda and Uganda Energy Efficiency Green Bond (Approved November 2015): Mexico, Colombia, Dominican Republic and Jamaica Benin Uganda Maldives Tuvalu Ecuador Kenya PNG Samoa Peru Rwanda Solomon Islands Fiji Tanzania Cook Islands Malawi Mauritius Vanuatu Namibia Madagascar South Africa Chile Argentina Status as of B17 (July 2017)

Portfolio composition As of B.16 Status as of B17 (July 2017)

Portfolio composition Status as of B17 (July 2017)

Estimated climate impact Portfolio Mitigation impacts 981 MtCO2eq Adaptation impacts 218 M beneficiaries Status as of B17 (JUly 2017)

Investments by results areas Portfolio Status as of B17 (July 2017)

Part VI: Accreditation

Fit-for-Purpose Accreditation Fiduciary functions Mandate & track record Basic Specialized Alignment with Fund objectives At least 3 year of operations Project size Environment & social risk category Micro ( <10M) Small (10-50M) Medium (50-250M) Large ( >250M) A (high) B (medium) C (minimal or no)

For more info, visit www.greenclimate.fund Quick links GCF 101 GCF portfolio Accredited Entity composition Resources mobilized … Follow us on Twitter @GCF_news