1. Engaging with the Green Climate Fund Ousseynou Nakoulima
Thank you to the Center for Clean Air Policy for inviting the Green Climate Fund to participate in this important forum on Climate Finance.
Focus of my short presentation today is the “Role of GCF in helping developing countries achieve low-emission and climate-resilient development and reach their NDC targets”.
I will provide:
Brief introduction to the Fund
Overview of GCF’s Readiness and Preparatory Support
Ousseynou Nakoulima
Director, Country Programming
CCAP Climate Finance Forum
20-21 May 2016 | Bonn, Germany

2. About GCF World’s largest climate fund
Agreed by 194 Parties to the UNFCCC
Provide support to developing countries
Mitigation: reduce greenhouse gas emissions
World’s largest climate fund. Established at the 16th Conference of the Parties in 2010 (Cancun, Mexico);
Agreed by 194 Parties to the UNFCCC. GCF is an operating entity of the financial mechanism of the UN Framework Convention, reiterated in the Paris Agreement;
Created to support low-emission (mitigation) and climate-resilient (adaptation) investments in developing countries; and
Investment mix: public and private sector, and here GCFis determined to partner with the private sector and harness its implementation capacity, to catalyze investments and maximize impact.
Adaptation: adapt to unavoidable impacts
Investment mix: public and private sector

3. GCF architecture
Brief run-through of GCF’s architecture – how we are structured.
Simple picture of the architecture
Fund with resources flowing through accredited entities
To climate change projects/programmes in countries
Using one of four financial instruments or a combination
With NDAs/FP playing a key role all through

4. State of Play: resources and allocation
US$ 10.2B in pledges
US$ 9.9B in signed contributions
42 governments, 8 developing countries
Geographic balance
Where are we on two important topics:
Resources:
To date, more than USD 10 billion equivalent has been pledged by governments to the Fund since it launched its initial resource mobilization period in 2015;
So far, USD 9.9 billion equivalent of the total pledged amount has now been converted into signed agreements and arrangements — representing more than 96% of the pledged total; and
Pledges from 42 state governments, 8 of whom are developing countries.
Allocation:
Aim to equally balance its allocation between adaptation (climate-resilient) and mitigation (low-emission) over time, and allocate significant resources to the private sector.
Also aim to allocate at least half of its resources for adaptation for countries that are particularly vulnerable to the impacts of climate change: Least Developed Countries (LDCs), Small Island Developing States (SIDS) and African States.
Resources we have and how we’re expected to balance the overall portfolio over time
Here’s what we have:
10.2 billion in pledges
5.8 converted into signed contributions that we can commit
Comes from 35 countries, 8 developing
Here’s how we need to allocate:
50% each to adaptation & mitigation (overall, not by country, and measured in grant-equivalent terms)
50% of adaptation has to go to SIDS, LDCs & African states
Ensure geographical balance but no country allocations
Significant allocation to the private sector
Sufficient resources for readiness (have $16million released, of which $2.5 million committed to 9 countries)
Resources and allocation targets
Resources for readiness
Significant allocation to private sector

5. Accredited Entities 33 entities accredited to date Ethiopia Kenya
Rwanda
Morocco
Senegal
Namibia
Argentina
India
Peru
Fund works through a wide range of entities to channel its resources to projects and programmes. To date, we have 33 institutions that are authorized to implement GCF-backed projects and programmes.
What do Accredited Entities do? They:
Develop and submit funding proposals for projects and programmes;
Oversee management and implementation of projects and programmes;
Deploy a range of financial instruments within their respective capacities; and
Mobilize private sector capital.
33 entities accredited to date
As of 31 March 2016

6. Building institutions: Fit-for-Purpose Accreditation
Fiduciary functions
Mandate & track record
Basic
Specialized
Alignment with Fund objectives
At least 3 years of operations
Environment & Social risk category
Project size
The purpose of the accreditation process is to ensure that arterial system through which the Fund’s resources will flow are healthy
That they are good enough to carry the relevant type and size resources that they are intended to carry, and will manage it’s use in an environmentally & socially responsible manner
Assess their standards and their track record for carrying the kind of resources they intend to carry, and for the purposes they intend to carry it
Accredit them for those purposes – that’s the fit-for-purpose approach
We’ll cover this in more detail in the last session today
Micro (>10mn)
Small (10-50mn)
Medium (50-250mn)
Large (>250mn)
A (high)
B (medium)
C (low)

7. Eight strategic result areas
In greater detail: Eight areas of GCF’s strategic results areas - mitigation and adaptation. Covering:
Livelihoods, energy, transportation, buildings & cities, forests & land use, other ecosystems, and health, food & water systems
Focused on impact, paradigm-shift potential; crosscutting adaptation-mitigation benefits, and broader 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
With a focus on
Impact
Paradigm-shift potential
Crosscutting adaptation-mitigation benefits
Sustainable development co-benefits

8. Catalysing the private sector – GCF Private Sector Facility
To mainstream climate change mitigation and adaptation actions in the private sector
Why a PSF?
Fund climate risk assessment models and tools
Long-term debt, credit lines and refinancing
Equity to develop a project to full bankability
Guarantees to bear specific risks
Interventions possible
Why a Private Sector Facility?
The PSF seeks to help scale up investment in low-emission development and unlock private sector investments in adaptation, responding to different country financial contexts and availability of capital.
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 them – 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
Accredited entities with private sector operations
Present funding proposals spontaneously or in response to calls for proposals
Access to the private sector

9. Approved project – public sector
Support of vulnerable communities in Maldives
Managing climate changed-induced water shortages
Funding: GCF: USD 23.5M | Maldivian Gov’t: USD 4.5M
Providing safe and secure freshwater to people on the outer islands of the Maldives
32K people in vulnerable households with safe water
73K people from a dry season water supply system
Improved groundwater quality to secure freshwater reserves for long-term resilience
Approved project with UNDP (AE) and Maldives Ministry of Environment and Energy.
High levels of poverty on the outer islands of the Maldives, which experience drinking water shortages during the dry season causing significant human, environmental and social impacts.
With $24M from the GCF, the project will:
Scale up an integrated water supply system based on rainwater, groundwater, and desalinated water into a low-cost delivery system for vulnerable households. This will provide uninterrupted supply to 49 islands that currently rely on emergency water deliveries for three months of the year.
Build water desalination production plants on four larger islands that will contribute to this improved dry season water desalination network to outer atolls and local supply systems.
And increased capacity of local and central government authorities will strengthen the management and efficiency of these systems.
This will result in:
100,000 direct beneficiaries (26% of country’s population) who will have access to safe water and improved groundwater quality to secure freshwater reserves for long-term resilience.

10. Approved project – private sector
KawiSafi Ventures Fund in East Africa
A new investment fund to drive off-grid solar power
Funding: GCF: USD 25M | Acumen: USD 7M
Investing in 10–15 clean energy companies, initially in Rwanda and Kenya
15M direct beneficiaries
Saving 1.5M tonnes of CO2 emissions
Providing off-grid populations with access to
cleaner and safer power
Approved project with Acumen to create KawiSafi, a new investment fund to drive off-grid solar power in East Africa.
With $25M from the GCF, Acumen will:
Use equity capital from GCF to leverage investment and grant capital to set up a Technical Assistance Facility.
Finance early-stage small- and medium-sized enterprises with core business models that address the off-grip solar system in East Africa
This will result in:
15M direct beneficiaries (16% of Rwandan, Kenyan and Ugandan populations);
Saving 1.5M tonnes of CO2 emissions by displacing kerosene at the household level (with health and safety co-benefits); and
Leveraging of GCF’s investment capital on a roughly 4:1 basis to create a $100M fund.

11. Build a pipeline of private sector-operated solar projects
Project support
Accelerating country pipelines
Country
Delivery Partner
Amount Requested
Duration
Senegal
IFC
USD 600,000
12 months
Purpose
Build a pipeline of private sector-operated solar projects
Proposed activities
Comprehensive mapping of solar resources
Technical and economic feasibility analysis
Review of institutional, legal and regulatory frameworks
Senegal wants to develop solar energy projects throughout the country and requested GCF to provide readiness support through the International Finance Corporation (IFC) to build a pipeline of private sector-operated solar projects within two years. Total expected cost for the readiness activities is $2.5M, of which $600K from GCF.
Expected outputs include:
Comprehensive mapping of solar resources throughout the country;
Technical and economic feasibility analysis of possible project sites; and
Review of the institutional, legal and regulatory framework for privately owned, renewable electricity production.

12. Financial instruments1
With/without repayment contingency
Terms determined on a case-by-case basis 2
Grants
Equity 3 4
Guarantees
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
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?
Concessional loans
High: 40 – 10 – 0%
Low: 20 – 5 – 7.5%

13. Getting ready: GCF Readiness Support
Nice group of people, our direct access country partners, representing entities and NDAs and focal points. Photo from GCF’s first "Readiness Week" to assist direct access entities in developing their project ideas.
The week-long event brought together the 13 organizations that have been accredited for direct access to the Fund, as well as 27 developing countries, represented by a National Designated Authority or Focal Point (NDA/FP).
More on this in a second…

14. GCF Readiness Support: Helping countries to build capacities
Knowledge
National priorities, strategies, plans
Coordination
Planning
Institution building
Programming and preparation
The Fund has developed some guidelines that will help countries understand the capacities the NDAs or FPs will need to ensure effective implementation of the Fund’s activities.
Ideally, the NDA or FP would have or would be able to attain:
Knowledge and familiarity with:
National priorities, strategies and plans
The country’s efforts and needs regarding adaptation and mitigation
2. Insight:
On the institutions and stakeholders in the country that are relevant for engagement with the Fund (ML and bilateral institutions, CSOs and entities with potential to be accredited as intermediary or Ies) and
An overview of activities of other funding mechanism and institutions in order to ensure proper coordination
3. Influence:
With a mandate that allows it to contribute to and drive national development strategies and plans
And capacity to facilitate multi-stakeholder consultations and engagement
Monitoring
Monitoring and Evaluation
Multi-stakeholder engagement

15. Readiness week assessment: What we heard
Support needed for project and programme preparation
Policy, regulatory and institutional capacity challenges
Stakeholder consultations
Support to accreditation of direct access entities
During the April readiness week we heard a lot from our country partners.
Some main themes include:
Diverse range of support needed for country and entity project and programme preparation.
Variety of policy, regulatory and institutional capacity challenges. Depending on country context, some countries are well advanced in putting forward projects and programme, whereas others required a range of capacity support to get the NDA up and running and to build out their project and programme proposals.
Countries voice the need for more engaging and inclusive stakeholder consultations.
Countries’ broad support for accreditation of direct access entities, either accredited or to be accredited.
Our main objective of the week was to help countries and entities development their work programmes.

16. Concept of country programme: Potential NDC investment strategy
Country investment priorities with GCF
National climate change strategies and plans
Self-assessment and Action Plan
And this links to the framework for each country’s NDC strategy which could be articulated in the form of a country programme.
The starting point for each country would be the national climate change strategies and plans that may already exist or in the process of development: NAMAs – NAPAs – NAPs – TNAs – INDCs – LEDS.
Aligned with the Fund’s results and investment framework.
The process is led by the NDA (or focal point) through an ongoing consultative process with public stakeholders (national and subnational), and private sector and civil society stakeholders.
Through such a process, the country can develop its framework to guide a diverse range of stakeholders on the countries priorities vis-à-vis the Green Climate Fund.

17. onakoulima@gcfund.org web | greenclimate.fund