Over the past 6 months, the Global Green Growth Institute (GGGI) and the Fiscal Policy Agency, Ministry of Finance Republic of Indonesia as the National Designated Authority (NDA) Green Climate Fund (GCF) Indonesia has been working with E Co. to build the capacity of shortlisted project proponents from the inaugural NDA Call for Project Concept Notes in developing concept notes for the Green Climate Fund (GCF). As part of the capacity building process, representatives from civil society organisations, local government, and the private sector have received in person training and remote coaching support.

Insight into the Call for Project Concept Notes capacity building process

The training programme is divided into two main parts:

1. Direct training in Indonesia
E Co. delivered two trainings in Indonesia, in October of 2019 and January 2020. Each training covered a number of topics, including, the GCF investment criteria; problem and solution trees; the climate rationale; theory of change; logframes; project finance and budgets; and co-financing requirements. Details about the October training can be read here

2. Remote coaching for concept note developers
After the in-person training in January, the programme continued with remote coaching support phase. This includes written feedback on concept notes, a webinar series and access to an online course on gender. By the end of the capacity building, E Co. will have provided three rounds of feedback on 25 concept notes. The webinar series prioritised topics based on feedback from the participants and GGGI, and observations from the concept note reviews. These topics included co-financing, environmental and social standards, paradigm shift, climate rationale. The gender course consisted of two modules (Module 1: Gender in GCF concept notes and Module 2: Gender mainstreaming) and was made available to participants via E Co. Institute

Focus on climate rationale and paradigm shift

The final webinar of the remote coaching support addressed the topic of climate rationale and paradigm shifts for mitigation and adaptation projects. This topic often poses challenges for project developers and generated a lot of discussion in the training session.

Climate rationale is a term used to describe the scientific basis of a concept note. This section, created at the beginning of the concept note, will be the foundation on which the entire project will be built. Climate rationale will describe a climate change scenario, outlining the climate issues in a particular country (e.g. floods, droughts for an adaptation project) and the region where the project will be implemented. Climate rationale needs to be mainstreamed into the concept note. For example, the barriers should be relevant to addressing the climate issues and the activities should address these barriers.

Next, grasping the concept of paradigm shift prior to executing the details of your project design can be very beneficial when planning a project. Paradigm shift is one of the 6 investment criteria of the GCF. According to the GCF definition, paradigm shift refers to “the degree to which the proposed activity can catalyze impact beyond a one-off investment and results in medium to long term change.” The GCF wants to see projects that are designed in a way that the project won’t just be a one-off investment but rather will catalyze broader sectoral change. Taking an example from the webinar, a project on developing geothermal energy (a GCF project currently being implemented in Indonesia) should build local capacity and train people within the country to be able to operate and maintain the technology throughout the lifetime of the technology – as opposed to importing expertise.

Special guest in the webinar, Pierre Telep from the GCF

Pierre Telep, from the GCF, joined as a guest speaker at E Co.’s final webinar. Pierre is a Renewable Energy Expert from the GCF. He spoke on the paradigm shift, mentioning that it is indeed a “very complex” term. Pierre explained how along with the rest of the 6 investment criteria (see image above), the paradigm shift is ranked by GCF’s ITAP (Independent Technical Advisory Panel) as being ‘high, medium, or low.’ He then explained the key elements of a paradigm shift that defines ‘impact.’ He shed light on issues relating to challenges differentiating between (3) and (4), where (3) focuses on ensuring the project activities should create a strong market environment and create opportunities for the private sector to invest in, e.g., mitigation technologies. (4) focuses on ensuring that the project will contribute to changes in laws and regulations so that the country can continue moving forward to address climate change.

Pierre emphasised that the GCF is accountable in ensuring that the public funds are used to create impact. This means that they must invest in projects will result in transformational change and will have a significant impact in terms of reducing emissions and building resilience that will extend far beyond the lifetime of the project. This is why paradigm shift should be mainstreamed throughout a project concept.

Closing

To date, the majority of the organizations that access GCF funds are large international institutions, such as international financial institutions or United Nations organizations. Direct access entities, or national-level entities (such as national NGOs) are unfortunately being left behind. Many of these entities lack the funding and capacity they need to develop a concept note or full funding proposal for the GCF. Bringing direct access entities to the table means greater country ownership, a key principle that the GCF strives for. The Fiscal Policy Agency, as the NDA GCF Indonesia, will continuously build the capacity of national and local actors in climate projects to support the emissions reduction target as well as increase communities’ resilience.

Increasing the capacity of entities with direct access means greater country ownership, which is one of the main principles of the GCF. The Fiscal Policy Agency as the NDA of the GCF will continue to build the capacity of local and national actors in climate change projects to support emission reduction targets and increase community resilience.