Access to Competitive Funding (2nd Round) for Innovative Programs and Projects that Engage the Private Sector in the SREP

Results from Second Round

The SREP Sub-Committee reviewed the expert group report and prioritized recommendations of project concepts submitted under the second round of the SREP private sector set-aside, and endorsed three project concepts totaling USD 32.8 million for further development. The decision was approved by mail on June 19, 2014.

Public versions of the concept notes are available for the three concepts that were reviewed by the expert group and endorsed by the SREP Sub-Committee:

1.    Olkaria VI Geothermal Power Plant, (AfDB) in Kenya

2.    Climate Venture Facility (KCFV) Project, (IBRD) in Kenya

3.    Self-supply RE Guarantee Program, (IDB) in Honduras

Under the Scaling Up Renewable Energy in Low Income Countries Program (SREP), in total after two rounds of proposals, approximately US$ 92.4 million in concessional funds have been set aside to contribute to financing for innovative programs and projects in SREP pilot countries. They are working to engage the private sector in piloting and demonstrating the economic, social and environmental viability of low carbon development pathways in the energy sector by creating new economic opportunities and increasing energy access through the use of renewable energy. 

Process and Background for Second Round of Proposals
To be considered for SREP funding, concept proposals for the second round were submitted by one of the multilateral development banks (MDBs) on behalf of the potential project proponent no later than March 31, 2014. Parties interested in accessing these funds were encouraged to contact the MDB SREP focal point located in the relevant country listed below. It was suggested to contact the focal point at least a month in advance of the March 31 deadline to allow time to collaborate in developing a proposal. 
Proposals for utilizing these funds were reviewed and selected on a competitive basis by the SREP Sub-Committee, taking into account recommendations of an expert group. 
Proposals eligible for financing under the SREP set-aside were aligned with the objectives of the endorsed Investment Plans of the first eight SREP pilot countries:  Ethiopia, Honduras, Kenya, Liberia, Maldives, Mali, Nepal and Tanzania. Proposals advance the SREP objectives (see SREP design document).  
Programs and projects will be implemented through one of the CIF partners: the African Development Bank, the Asian Development Bank, the Inter-American Development Bank and the World Bank Group, including the International Finance Cooperation.
In reviewing proposals, the following were considered:
  • Level of innovation: this may include market creation, innovative financing structures, pilot testing of new business models, and new partnerships;
  • Projected leverage ratio:  expected ratio of SREP funds to total project amount. Recognizing that projects with significant levels of private sector financing should receive a higher appreciation over all. 
  • Increased supply of renewable energy or increased access to modern energy services:Projects should address at least one of the previous objectives. If a project achieves both this should be explained.  
  • Readiness: projects are expected to be approved by MDBs within 12 months from the endorsement of the project concepts by the Sub-Committee.  Assessment of readiness may include regulatory framework, institutional capacity, project ownership, implementation risk, or project design clarity; and
  • Commercial sustainability: the likelihood of a project being able to stand alone in subsequent iterations or on a larger scale, without the need for additional concessional funding.  

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