Sustainable Infrastructure Project Guiding Principles, Self-Evaluation and Validation Tool

Global Energy Basel Foundation (©)

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Basel, GEB, February 2012| André Schneider

The Sustainable Infrastructure Project Guidelines, Self-Evaluation and Validation Tool of the Global Energy Basel Foundation is an adaption done by Daniel Wiener, chairman Global Energy Basel and CEO ecos, and André Schneider, deputy chairman Global Energy Basel and CEO and chairman André Schneider Global Advisory, of the "Guidelines and Principles for Public Private Partnerships in Sustainable Water Management", which were designed in an extensive multi stakeholder and expert consultation process by the consultancies ecos of Basel and BHP of Zurich, commissioned by the Swiss State Secretariat of Economic Affairs (SECO) and the Swiss Development Cooperation (SDC) in cooperation with the re-insurer Swiss Re.

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Disclaimer

• Confronting the challenges of climate change mitigation and adaptation, resource scarcity and energy security will require massive investment in the fundamental reconfiguration of the infrastructure that supports modern society.

• By 2050, nothing will function as it does today. This challenge presents huge opportunities both for investors, general contractors and for projects owner.

• To accelerate the development of sustainable infrastructures we need a common language and also definition between the financial, government, and construction community. Even more so we need to clarify what sustainable really means as many limit this very often to a pure ecological question.

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GEB RationalFundamentals and GEB-Platform

• To create a common definition and language, we need to define criteria that define a sustainable infrastructure project and this for its economic side, its social side and its ecological side. We a also need to support the understanding by offering a qualitative way to self assess the specific qualities and challenges for such a project.

• By globally applying such a system of self assessment, we will also be able to create a de facto grading which will help to manage risks better and facilitate the decisions of financial institutions to invest in such projects.

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GEB RationalFundamentals and GEB-Platform

Guiding PrinciplesTen Themes

The following ten themes clearly affect the performance of sustainable infrastructure projects and their governance:

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AccountabilityTransparencyCustomer FocusResults OrientationPoverty ResponsivenessPower-Balanced PartnershipsShared IncentivesSound Financing MechanismsProactive Risk ManagementResource Protection

The Ten ThemesAccountability and Transparency

• Governmental institutions, the private sector and civil society organisations must be equally accountable to their stakeholders and to the public.

• Transparency, the rule of law and effective oversight all play a crucial role in making partnerships work and holding actors accountable. Transparency is an indispensable precondition to countering corruption and bribery. Key to transparency is access to information.

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The Ten ThemesCustomer Focus and Results Orientation

• Customers as actors with rights and obligations are only willing to pay if they perceive the level and quality of service to be adequate. Therefore, striving to serve customers and responding to their requests is essential.

• Agreement on overall goals and priorities permits the use of results-driven steering mechanisms. This will provide scope for innovative and efficient approaches.

• Distinct measurement criteria and agreed adjustment processes in changing environments provide the basis for effectively achieving goals.

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The Ten ThemesPoverty Responsiveness

• Running a sustainable infrastructure does not necessarily or naturally address poverty issues.

• The delivery of basic services requires explicit efforts by governments to meet the needs of the poor through, for example, designing effective support mechanisms - such as smart subsidies - to ensure affordability.

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The Ten ThemesPower-Balanced Partnerships

• Successful relationships are based on negotiating balances of power and capacity among the contracting parties.

• Enabling stakeholders to effectively play their roles in the sector is key for successful and accepted processes.

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The Ten ThemesShared Incentives

• Taking into account the range of stakeholders and their objectives demands expectations and interests to be made transparent. From this starting point, common goals can be identified, incentive mechanisms that link the interests designed and possible adverse impacts addressed.

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The Ten ThemesSound Financing Mechanisms and Proactive Risk Management

• Self-financing infrastructure services are at the core of sustainable services. The focus must be on financially appropriate systems and service levels, as well as on favourable financing architecture.

• Exposure to, and management of, commercial and non-commercial risks strongly influence the prospects of success. A risk culture that identifies the risks, allocates them appropriately and uses effective mitigation strategies significantly improves the risk profile.

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The Ten ThemesResource Protection

• Respecting the limits and protecting the quality of resources available through a systematic assessment of the environmental impact of planned activities and investments is required.

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Self-Evaluation and Validation ToolsAn overview and first approach to performance

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