Arrangements for the Management of the Adaptation Fund: Global Environment Facility (GEF)

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Arrangements for the Management of the Adaptation
Fund Global Environment Facility (GEF)
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Outline

• History
• Structure
• Principles
• Trustee Operations
• Evaluation
• GEF Support to Adaptation

• Stage 1 Stage 2 Adaptation
• Beyond Stage 2
• SPA
• SCCF
• LDCF
• GEFs Role as Manager of Adaptation Fund

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History

• Pilot Phase 1991-1994 (750m)
• Negotiations for Restructured GEF
• GEF Instrument
• GEF 1 1994-1998 ( 2.0 billion)
• GEF 2 1998-2002 (2.75 billion)
• GEF 3 2002-2006 (3.0 billion)

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GEF A Network Organization
IAs/EAs
ADB
AfDB
EBRD
Evaluation Office
CBD
ASSEMBLY COUNCIL CEO/CHAIRMAN GEF SECRETRIAT
UNDP
UNFCCC
UNEP
NGOs
POPS
W.B.
CCD
FAO
Multilateral Fund of Montreal Protocol
IDB
STAP
IFAD
International Waters
UNIDO
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Operational Principles

1. As Financial Mechanism of UNFCCC, CBD, ODS,
   priority is implementing Guidance of COPs
2. Funding to meet agreed incremental costs of
   global environmental benefits
3. Cost-effectiveness
4. Country-drivenness

1. Maintain Flexibility
2. Full disclosure of information
3. Stakeholder Consultation
4. Eligibility (9a 9b)
5. Catalytic roleleveraging resources
6. Regular and open Monitoring and Evaluation

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GEF Trustee Operations

• World Bank serves as Trustee of GEF Trust Fund,
  LDCF and SCCF
• WB manages more than 800 Trust Funds
• Each fund managed separately
• Responsibilities
• Maintenance of distinct, appropriate records,
  including independent annual audits
• Disbursement of monies from funds
• Investment of liquid assets in funds
• Preparation of financial reports
• Regular reporting to the Council

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GEF Trustee Operations (cont)

• WB Trustee Office has developed accounting,
  control systems reporting infrastructure
  resulting in considerable economies of scale and
  cost savings
• Services provided are compensated at actual costs
  which are minimal
• In addition, draw upon experience of WB Treasury
  operations in trading on financial markets

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GEFs Office of Evaluation (1)

• Office of Evaluation (originally office of
  Monitoring Evaluation, renamed and made
  independent, 2005)
• Undertakes Climate Change Program Study (2000
  2004) as input to independent evaluations
• Sets standards and policy for project and
  portfolio monitoring
• Monitoring Evaluation Requirements
• All projects must supply log-frame, allocate
  responsibilities for annual monitoring,
  independent mid-term and final evaluation, and
  set aside budget for ME
• Monitoring report (APR PPR) must be made
  available on an annual basis

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Independent Evaluation (1)

• Prior to replenishment, GEF undergoes Independent
  Evaluation
• Undertakes Climate Change Program Study (2000
  2004) as input to independent evaluations
• OPS1 (1997)
• Effectively created new institutional
  arrangements
• Relatively successful in leveraging resources
• Had implemented guidance of conventions with
  respect to GEFs own mandate and funding
  limitations
• OPS2 (2001)
• GEF achieved significant results
• GEF had responded to guidance from conventions,
  but required more frank dialogue exchange of
  ideas
• OPS3 (2005)
• GEF is a network organization, which is
  appropriate
• GEF has effectively performed its role as
  financial mechanism responding to COP
  guidance--coordination has improved
• GEF is a more stable and effective institution in
  2005 than it was in 2001

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GEF Response to UNFCCC Guidance on Adaptation

• COP I Guidance Stage I Adaptation through
  Enabling Activities (11/CP.1)
• VA Assessments part of enabling activities
• From 1995 to 2005, over 160m allocated to EAs
  in nearly 140 countries
• VA one of components of EAs--optional
• Over half of countries included some element of
  VA
• Up to 40m from EAs devoted to VA assessments

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Stage II Adaptation Planning Studies

• COP 4 in 1998, Guidance provided to support Stage
  II activities (2/CP.4)
• Further round of adaptation projects
• CPACC-Caribbean Planning for Adaptation (GEF
  6.8m)
• PICCAPPacific Islands CC Assistance Program (GEF
  3.44m)
• MACCMainstreaming Adaptation to CC in Caribbean
  (GEF 5.98m Total 9.64m)
• Cap Bldg for Stage II Adaptation to CC in C
  America, Mexico, Cuba (GEF 3.64m, Total 4.90m)
• Assessment of Impacts Adaptation to CC (global,
  UNEPGEF 8.23, Total 12.46m)
• Took Steps to further understanding of countrys
  adaptation needs and logical next steps

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Beyond Stage II Toward Implementationthe SPA

• GEF should support inter alia establishment of
  pilot or demo projects to show how adaptation
  planning and assessment can be practically
  translated into projects providing real benefits
  (5/CP.7)
• GEF created new strategic priority in CC Focal
  Area entitled Piloting an Operational Approach
  to Adaptation (SPA)
• Set aside 50m to be used for concrete adaptation
  projects in focal areas in which GEF works
• Close to 30m of projects have already been
  approved

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SPA Projects

• Approved SPA Projects
• Kiribati Adaptation Program (WB, GEF 2.07m
  Total 6.69m)
• Colombia National Adaptation Pilot (WB, GEF
  6.07m Total 17.5m)
• Pilot Adaptation Measures in Dominica, St Lucia
  and St. Vincent Grenadines (WB, GEF 2.61m,
  Total 6.4m)
• Lake Balaton Vulnerability, Early Warning
  Adaptation Strategy, Hungary (UNDP, GEF 1.13,
  Total 4.07)
• Integrating VA to CC into Sustainable Devt in
  Southern Eastern Africa (UNEP, 1m Total 2.25
  m)
• Recently Recommended SPA Projects
• Community-Based Adaptation (UNDP, GEF 5m Total
  10m)
• Responding to Shoreline Change in West Africa
  (UNDP, GEF 4.0m Total 7.5m)
• Coastal Zone restoration and Sust. mgt in
  Post-tsunami Sri Lanka (IFAD, GEF 4mLD
  1.9mSPA, total 15m)
• Pipeline
• Coping w/ Drought in Eastern Africa (4 MSPs)
• Sustainable Land Mgt in Zambezi Valley (MSP)

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Beyond Stage II the Special Climate Change Fund

• In Marrakech, COP7 established the special
  climate change fund to finance, inter alia,
  activities in adaptation and transfer of
  technologies (Decision 7.CP7) and requested GEF
  to manage it
• GEF Prepared a programming paper and hosted a
  donors meeting
• Defines additional costs imposed on country not
  incremental cost for global environmental
  benefits
• Proposed sliding scale as a simplified procedure
  to estimate eligible additional costs
• Donors contributed 31m to initial endowment in
  September 2004

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SCCF Open for Operations in September 2005

• Separate Pipeline Operation for SCCF
• Approved
• Tanzania Pangani River Basin (UNDP, GEF 1m,
  Total 2.57m)
• Pipeline (GEF total estimated at 31m)
• Adaptation to CC thru Effective Water Governance
  in Ecuador (UNDP)
• Piloting CC Adaptation to Protect Human Health
  Barbados, Fiji, Uzbekistan Jordan (UNDP)
• Pilot CC Adaptation measures in Andean Region
  (WB)
• Pacific Islands Adaptation to Climate Change
  Project (PACC) (UNDP)
• India Climate-resilience Development and
  Adaptation (UNDP, SCCF)

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Least Developed Countries Fund (LDCF) (1)

• In Marrakech, COP7 created LDC fund to support
  NAPAs (Decision 7/CP.7) and requested GEF to
  manage it
• GEF established LDCF
• Consulted with LEG, Feb/Mar 2002
• Developed Guidelines for funding NAPAs
• Two donor meetings were held
• Stockholm, 2002
• Paris, 2004
• Raised 40.5m for LDCF
• Support NAPA Preparation in 44 countries
• LDCF still contains 29.2m for NAPA
  Implementation

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LDCF Implementation

• Process
• COP11 Decision on NAPA Implementation (Decision
  -/CP.11)
• Consultative workshop held in Dhaka, Bangladesh
  April 4-6, 2006
• Reached agreement on Programming paper
• Donors meeting held in Copenhagen, April 28, 2006

• Innovations in Programming
• Streamlined project cycle (approvals on a rolling
  basis, 4 Council member objections required to
  halt project)
• Additional cost approach for funding costs
  imposed on LDCs
• Full-cost funding for instances where case is
  proven
• No need to demonstrate global environmental
  benefits

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Adaptation Fund

• In Marrakech, COP 7 created Adaptation Fund
  (Decision 10/CP.7) and requested GEF to make
  arrangements to manage fund
• GEF Council and World Bank Board accepted the
  request to establish the Adaptation Fund,
  including conversion of CERs
• GEF Secretariat, Trustees Office and UNFCCC
  Secretariat had begun discussions on Adaptation
  Fund arrangements
• Summarized in GEF Report to COP 11

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GEFs Strengths in Managing Adaptation Fund

• GEFs governance is transparent, universal and
  responds directly to Guidance from Convention
  bodies
• GEF has demonstrated flexibility in responding to
  guidance and new programming challenges
• GEF already manages three different sources of
  adaptation funding
• Structured Learning
• Administrative Simplification Savings

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GEFs Strengths in Managing Adaptation Fund

• GEFs Administrative Structure provides a sound
  foundation for AF
• Trustees office to manage
• Pre-existing structures results in savings
• Experience with Treasury operations bring
  established experience in financial markets
• GEF is a network organization with capacity to
  support the global environment and sustainable
  development
• Council Constituencies represent all countries
• Three IAs UNDP, UNEP, World Bank
• Seven EAs IFAD, FAO, UNIDO, ADB, AfDB, EBRD,
  IDB
• Other executing agencies can be utilized as
  appropriate