Transformative RBCF Solutions for the Urban Poor

World Bank Group Technical Dialogue“New Perspectives on International Cooperation:

Carbon Markets and Climate Finance under the Paris Agreement” May 22, 2017

Raluca GolumbeanuCharis Lypiridis

GLOBAL PARTHERSNHIP ON OUTPUT BASED AID ( GPOBA)

GLOBAL REACH

PforR SUPPORT

SUBSIDY PORTFOLIO (active/closed)TECHNICAL ASSISTANCE

WATER, SANITATION, ENERGY, HEALTH, EDUCATION, TELECOM, SOLID WASTE

KEY ACHIEVEMENTS:

Subsidy pilots: 48 ($234m)

Direct Beneficiaries: > 9 million reached

TA/dissemination activities: 177 (=$28 m)

Evaluation and analysis

Knowledge dissemination

CHALLENGES THAT OBA ADDRESSES

Poor people in urban, peri-urban, and rural areas lack access to basic services

Public and private service providers lack incentives to serve the poor

There is a “gap” between the cost of service and user’s ability to pay

No accountability for results

Household Service Provider Gap for PoorHousehold

Connection Cost

AffordabilityLevel

Required GPOBA Investment

Total Connection Cost

Third PartyContribution

Definition: Investment through performance-based payments which is payable upon the achievement of measurable results, and targets to facilitate poor households’ access to basic services

WHAT IS OBA?

CLIMATE AND CITIES AGENDA

Cities are pathways out of poverty BUT poverty is rapidly urbanizing

Cities offer better quality of life BUT the benefits of urbanization for the poor have been fragmented

By 2030, rapid, inclusive, and climate-informed development can prevent most (but not all) climate change impacts on poverty

RBF FOR CITIES IN A CLIMATE-SMART FRAMEWORK Re

sult

s-Ba

sed

Fina

ncin

g

Pro-Poor Planning Indicators

Robust M&E Framework

Evidence-based Design

Results-based

Climate and Infrastructure Finance

Blended Finance and Holistic Urban Programs

Identifying Synergies (Sector, Multi-City)

Knowledge Transfer

Private Capital

Sust

aina

ble

Citi

es

Institutions

Infrastructure

Services

Land

N

atur

eN

etw

orks

Cities Agenda

Planning Financing Connecting

Climate-Smart Solutions

Resilient Design GHG Reductions Environment

RBF PROJECT DESIGN ROADMAPINCLUSIVE AND LOW-CARBON CITY SOLUTIONS

Pro-poor andClimate SmartIntervention

Private Investors Results-basedClimate Finance

Mechanism

Perfomance-Based Consessional Loan or

Grant

Public Funds HouseholdContribution

1. Address affordability levels

2. Strengthen institutions

Cost

In

clus

ive

and

low

-car

bon

city

solu

tion

3. Address the financing gap of poor households

4. Develop climate-smart solutions

5. MobilizePrivate Capital

Project ownership

Policy prioritization

Pro-poorincentive schemes

Leverage of carbon market instruments

OBA IN ENERGYProvide energy access to clean energy solutions to more than 3 million

Scoping studies to assess feasibility of RBF

Impact assessments

198,861

1656

530000

26400

34138

5847

1376

- 100,000 200,000 300,000 400,000 500,000 600,000

Grid

Mini-grid

SHS and pico-PV

Biogas

Gas

Heating

SIP

Verified energy outputs

OBA IN RENEWABLE ENERGY

Pro-poor access

Leveraging private sector participation

Value for money

Partnerships

Fragile environments and scale-up potential

10

Mali Hybrid Mini-grids

AMADER in partnership with 18 selected private operators

Targeting: off-grid areas

Status: about 32,000 SHS and minigrid beneficiaries

Challenges: fragile environment and capacity constraints

Implementation support

Bangladesh Rural Electrification and Renewable Energy

11

IDCOL in partnership with private sector

Targeting: off-grid rural areas

Financing mechanism and Technical assistance

Status: RERED II scale up

4 million SHS installations Technologically diversification Lessons learned Gender mainstreaming

100 KW Solar PV Mini-grid at SandwipIsland financed under RERED

Why OBA?

12

Pro- poor transformational impacts

Leveraging private sector