Green Fund Application Process & Lessons Learned SALGA WORKSHOP, DURBAN 28 November 2013

Michelle Layte Green Fund

Presentation Outline

•

Green Fund Overview

•

Green Fund Programming

•

Funding Design & Finance windows

•

Initial Response & Lessons

Green Fund Overview

 In 2012

, National Treasury allocated an initial R800 million

for financial years (FY2012/13- FY2014/2015) for the set-up & establishment of a Green Fund. 

DBSA appointed as implementing partner

, effective from 1 April 2012, and confirmed through the signing of the MoA with DEA (Department of Environmental Affairs) 

Phase 1- Establishment (May 2012- Oct 2012)



Phase 2- Building Project Pipeline ( Aug 2012- March 2013)

 

1 st 2 nd Public RFP (Sept – Oct 2013) Research RFP (Feb – March 2013)

Green Fund Programming

•

The Green Fund aims to:

• promote innovative and high impact green programmes and reinforce climate policy objectives through green interventions, • Build an evidence base for the expansion of the green economy & attract additional resources

Build evidence base for legislative reform Green Fund Portfolio of Projects Research Capacity Building Develop an investment environment for leveraging of non-public sector funds

Funding & Window Design

Product Offering Project development Capacity building Research and development Green Cities and Towns

Greening core municipal infrastructure such as water, energy, transport and waste management Sustainable human settlements, the built environment and green buildings Integrated planning for climate resilient cities and communities

Low Carbon Economy

Cleaner production, reducing consumption of natural resources Climate mitigation, energy efficiency, renewable energy and biofuels Research and innovation to drive competitiveness in green economy

Allocation

75% 20% 5%

Environmental & Natural Resource Management

Sustainable management of natural resources and investment in ecosystem services Sustainable agriculture and land use practices Rural and land based adaptation models

Application Process



1 st

 

Public Request for Proposals (RFP): 21 st Project Finance of September 2012 - 24 th of October 2012 590

applications worth

R10.9 billion

were received and evaluated based on the eligibility criteria outlined below.



2 nd



Public RFP: issued 1 February 2013, closed on 28 March 2013 Research & Development

 155 applications worth

R1.6 billion

were received and evaluated based on the eligibility criteria 

Criteria stipulated in Application Guidelines Relevance

match to the thematic funding Window and focus areas therein

Innovation Additionality Ability to scale up and/or replicate

the project is new and unique in the green economy space. This innovation can relate to any of the following aspects: technology, business model, institutional arrangements, or financing approach the project cannot proceed without the Green Fund’s financial support and a funding gap should be demonstrated.

the project has the potential to be rolled out to other sites and/ or to be implemented at a large scale.

RFP Submissions- Key sectors in the research and project applications

Applicant Types

Geographical Spread

9

Green Fund- Initial Lessons

•

Positive Funding Demand

: Request through RFP process amounting to R10,9 billion, mostly for initiating & scale-up of start-up projects in the following sectors: renewable energy, waste technologies & systems for efficient water management, innovative modalities for sustainable city planning •

Appetite & uptake

from private sector, local government, however limited NGO response. The Research RFP shows greater interest by Research Institutions (universities, CSIR, HSRC) •

Geographic spread-

uptake mostly from GP, WC, KZN and EC

Green Fund- Initial Lessons

What are the under-represented sectors & provinces telling us about the process & “applicant” readiness to access finance?

Process Issues

 Access to information – RFPs advertised in all national newspapers, Green Fund website  Timeframe for submission  Web-based application system to preserve integrity of submissions

Green Fund- Initial Lessons

What are the under-represented sectors & provinces telling us about the process & “applicant” readiness to access finance?

Applicant Readiness

 Not meeting Eligibility Criteria

(Application Guidelines)

   

Relevance-

fit the thematic funding window and focus area

Innovation-

proposal is new and unique in the green economy space (technology, business model, institutional arrangements, or financing approach)

Additionality-

project cannot proceed without the Green Fund’s financial support and a funding gap should be demonstrated

Ability to scale up and/or replicate-

project has the potential to be rolled out to other sites and/ or to be implemented at a larger scale  Incoherent proposal & methodology response to criteria  Unclear budget requests, usually not costed or breakdown provided  Supporting documentation not provided (eg. Municipal supporting letter)

THANK YOU

Michelle Layte Green Fund- Secretariat Manager Development Bank of Southern Africa (DBSA) +27 11 313 5237 (office) +27 11 206 5237 (fax) Website: www.sagreenfund.org.za