What are the six investment criteria of the GCF?
GCF has overall objectives to guide investment decisions. The six investment criteria are
- Impact/result potential:Potential of the programme/project to contribute to the achievement of the objectives and results areas of the GCF.
- Paradigm shift potential:Degree to which GCF can achieve sustainable development impacts beyond one-off project or programme investments by replicating and scaling them up.
- Needs of the recipient:Financing needs of the beneficiary country.
- Country ownership:Beneficiary country ownership of and capacity to implement a funded project or programme (including policies, climate strategies and institutions).
- Economic efficiency:Benefit-cost ratio of activity, translated to a measure of impact per US dollar delivered by the Fund.
- Efficiency and effectiveness:Financial soundness of the activity.
How does it fund entities?
The GCF finance projects and programmes in the public and the private sectors that contribute towards achieving at least one of the eight strategic impacts of the Fund. Access to GCF resources to undertake climate change projects and programmes is possible for accredited national, regional, and international entities. Accredited Entities (AEs) can submit funding proposals to the Fund at any time. To ensure country ownership, the Fund’s Board will consider only those funding proposals which are submitted with a formal letter of no objection in accordance with the Fund’s initial no-objection procedure.
An AE or an executing entity (i.e. project or programme sponsor) may submit a concept note for feedback and recommendations from the Fund, in consultation with the National Designated Authority or Focal Point. The recommendation will clarify whether the concept is endorsed, not endorsed with a possibility of resubmission, or rejected.
Why does GCF use Accredited Entities?
GCF recognizes that individual organizations possess the type of specialist knowledge and experience that can be best utilized to mobilize climate finance on the ground. That is why GCF works through a wide range of Accredited Entities to channel its financial resources to climate change projects and programmes. Accredited Entities can be private, public, non-governmental, sub-national, national, regional and international. The use of Accredited Entities is set out in the GCF Governing Instrument, the central institutional guide for all of the Fund’s activities. Accredited Entities develop funding proposals to be considered by the Fund and oversee, supervise, manage and monitor their respective GCF-approved projects and programmes.
There are two types of GCF Accredited Entities, based on access modalities: Direct Access Entities and International Access Entities.
How long is the entity accredited for?
Five years. GCF is currently working on ways to assess Accredited Entities for re-accreditation.
What will accredited entities do?
Accredited entities may carry out a range of activities, including:
- Developing and submitting funding proposals for projects and programmes;
- Overseeing management and implementation of projects and programmes;
- Deploying a range of financial instruments within their respective capacities (grants, concessional loans, equity & guarantees); and
- Mobilizing private sector capital.
What is the Simplified Approval Process?
As part of its efforts to quickly build a large and transformative project portfolio, GCF may consider some projects or programmes under the Simplified Approval Process (SAP). Under the SAP, the documentation and processes for small-scale projects that meet certain eligibility criteria are reduced and simplified. Learn more about the SAP.
Is a concept note necessary before a funding proposal is submitted?
No. The development of a concept note prior to a funding proposal is voluntary. It is recommended, however, as a useful first point of dialogue with the GCF Secretariat and the NDA or focal point to seek initial feedback.
What is the Project Preparation Facility?
The Project Preparation Facility (PPF) can support project and programme preparation costs from all accredited entities, especially direct access entities and especially for projects in the micro-to-small size category. Funding available is up to USD 1.5 million for each PPF request, and can be provided through grants and repayable grants while equity may be considered for private sector projects through grants or equity. Funding proposals developed with the PPF should be submitted to the GCF Board within two years of the approval of a PPF request.
Support can be granted of up to USD 1.5 million per request.
Who can apply for PPF support?
The Project Preparation Facility is open to requests from all accredited entities to the Fund. However, it is especially targeted at supporting direct access entities and micro to small-sized category projects.
Can entities that are not yet accredited to GCF apply for PPF support?
No. PPF support is intended only for entities that are accredited to GCF. Direct access entities that are not yet accredited may be able to receive support to help them with this process via the Fund’s Readiness and Preparatory Support Programme. Such applications are made via the relevant NDA.