State of Play Update from the Green Climate Fund
Tao Wang (Green Climate Fund)

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State of Play Update from the Green Climate Fund
Tao Wang (Green Climate Fund)

State of PlayGCF: Key facts

Update from the Green Climate Fund
Initial capitalisation of approximately $2.3 billion
Key decisions for resource mobilisation taken in May 2014
Will offer a range of financial instruments to promote paradigm-shifting investments in developing countries: startingwith loans and grants
Balance investments in adaptation and mitigation
Channel finance through accredited entities (public, private, international, regional, national and sub-national)
Fast-track accreditation for implementing entities of existing funds
Readiness programme for developing countries

Tao Wang
Green Climate FundInternational Seminar on REDD+February 3-4, 2015

What I am going to do today is to share with you the state of play of the Green Climate Fund,where we are and we are aiming to go for the next calendar year and beyond. I would also like to present toyou a few operational pillars that have been established so far. More importantly, I would like to also give youa status update on what had been established and achieved on the forestry and land use sector in the Green
Climate Fund context.
1. Moving into Full Operation

Moving into full operation
Secondfundraising
meetingFirst fundraising
meeting

2014

MayJuneJulyAug

REDD+ PMF,
Readiness programme,
Accreditation
framework approved at
8th Board meeting

SeptOct

Nov

Essential operational
policies adopted at 7thBoard meeting

2015

JanFebPledging
conference

Dec

Lima COP($10.2 billion)

MarEntities
accredited

AprMayEffective

JunJulAug

SepOctFunding
proposals
approved

This shows what has been achieved in past few months in the Green Climate Fund context, and then
how we see ourselves in the next 12 months; the main milestones that we want to reach. As you can see, inMay 2014, the essential operational policies have been adopted including the investment framework, results
management framework, and proposal approval process.

Since then, the fund has really undergone anintensive exercise of mobilizing funding. As of December 2014, the Lima COP, the Green Climate Fund has
mobilized US$10.2 billion.
Very importantly, I want to highlight that, in October 2014, the REDD+ Performance Management
Framework was also adopted. I will talk about this later because I know that many of you are expert in thissector and will be interested in knowing how the Green Climate Fund can help contribute to this agenda.

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Looking forward, as you can see at the bottom of this slide, in 2015 we have three main milestones.
First, by March, we will have the first group of implementing entities or intermediaries accredited. At themoment, the team is very actively reviewing the applications from all kinds of entities. The second milestone
is that, by end of April, we aim to convert at least 50% of the US$10 billion pledge into legal commitments.
That will mark the effectiveness of the fund. By October, our last Board meeting in 2015, we aim to have thefirst group of funding proposals approved by the Board. That will send a positive signal to the Paris COP
that the fund is fully operational and delivering results. With this slide, you can see that the Green Climate
Fund is now open for business and fast moving into full operation.
2. Allocation & Investment Frameworks

Allocation Framework
Total Fund Portfolio
Adaptation Portfolio
Mitigation(50%)

Adaptation(50%)••••

SIDS, LDCs& Africa(at least half)

OtherDevelopingcountries

Geographic balance
Significant allocation to Private Sector Facility
Sufficient resources for readiness activities
Grant equivalent term

I wanted to introduce you a few operational pillars that have been established that give you anoverview of how the fund operates. This is the allocation framework, very high level allocation guideline.
As you can see from the left pie, the fund strives to maintain a balance between mitigation and adaptation.
50% of the resources will be channeled to mitigation with another 50% channeled to adaptation. Within
adaptation, at least half of the resources will be allocated to small island developing states, least developed
countries, and African states. In the meantime, we want to ensure sufficient resources for the readinessactivities and also significant resources will be allocated to private sector facility. All this is in grant equivalentterm.
You may wonder where REDD+ fits. In fact, we all know that REDD+ actually cuts across both
mitigation and adaptation. You will see that REDD+ is one of the strategic impact areas that the fund hasalready adopted in mitigation.

State of Play Update from the Green Climate Fund
Tao Wang (Green Climate Fund)

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Investment Framework
Impact Potential• Potential to the achieve the Fund's objectives andresult areas

Paradigm Shift Potential• Potential to catalyse impact beyond a one-off projector programme investment

Sustainable Development
Potential• Potential to provide wider benefits and priorities

Needs of Recipient• Vulnerability and financing needs of the beneficiary
countryCountry Ownership• Beneficiary country ownership of and capacity toimplement funded activities

Efficiency & Effectiveness• Economic and, if appropriate, financial soundness ofthe programme/project

Investment framework: these are the six criteria that we will use to assess funding proposals. We
would like to work with all the entities to develop high quality project programs that aim to perform against
these six criteria in a very robust and innovative fashion.
Impact potential talks about the potential to achieve the mitigation and adaptation results.
Paradigm shift potential means that we do not look at only the proposed project program, but we also look at
the potential to catalyze impact beyond this one-off project or program through scaling up, replication, orthrough creation of enabling environment and promoting new market segments.

Also, sustainable

development potential, needs of the recipient, country ownership, and efficiency and effectiveness. I will behappy to elaborate if you are interested in what all these criteria mean essentially and how you prepare
proposals to demonstrate your performance against these criteria.
3. Strategic Impact Areas & Readiness Program

Strategic Impact Areas
Mitigation:

Adaptation:• Low-emission energy accessand power generation• Low-emission modes oftransport• Buildings, cities, industries andappliances• Land use, deforestation, forest
degradation, and throughsustainable management offorests and conservation andenhancement of forest carbon
stocks• Livelihoods of people,communities and regions• Health and well-being ofpeople, food and water
security• Infrastructure and built
environment• Ecosystems and ecosystems
services

REDD+ is in one of the eight strategic impact areas that the fund has agreed up; four on mitigationand four on adaptation. In total, there are eight impact areas. Land use and REDD+ is one of the four
mitigation impact areas. That indicates the Green Climate Fund’s commitment and priority in this area. Of
course, REDD+ activity actually can achieve a lot of the results on the adaptation side; the livelihood ofpeople, community, and regions; health and well-being; and ecosystem and ecosystem services.

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Readiness Programme• Support countries to engage with Fund
• Respond to country needs and priorities,
working in collaboration with the NDA/FP• Build on existing structures and efforts,
and work in partnership with others• Identify and support interventions thatwill add value at country level

Strengthening
NDAs/FPs

Sharing
Information &Experiences

Developing
Pipelines

Scope ofReadinessSupportDeveloping
Strategic
Frameworks

Accrediting
Entities

The Fund’s readiness program aims to support countries to engage with the fund establishing the national
designated authority/focal points so that we have a counterpart in a country to work with to identify thepriorities in a country and also nominate the national or subnational implementing entities that can directly
access to the financing from the fund and to carry out project programs.
You may wonder how that relates to the readiness activities in the REDD+ framework. I think theanswer is that the readiness program definitely can support the readiness needs of the country in REDD+ if
the country across the spectrum of readiness activities see this as a priority for them. We are very keen to takethe country-driven approach, so all the readiness requests will come from the country’s national designatedauthorities. We will act upon their request.
4. Accreditation Framework

Accreditation Framework– Who can apply for accreditation?
•••

All entities, including international, regional, national and subnational
and public and private entities, can apply for accreditation throughone of two modes of access:Direct access track: for regional, national and sub-national entities.
– NDA nomination required– Entities may be eligible to receive readiness and preparatory
support on accreditation
International access track: for international entities, including United
Nations agencies, multilateral development banks, international
financial institutions and regional institutions

Accreditation framework: as I mentioned earlier that we are now open to all kinds of entities,international, national, sub-national, and local entities to apply accreditation.

This is the first and themandatory step that the entities need to go through before they can start preparing proposals and accessfunding. So far, we have received about 30 applications and we are in full swing reviewing these applications.
Next week, actually, there is an accreditation panel that will come to the headquarters to review the applications.
We aim to make the first set of recommendations in March for accreditations. As you may recall, one of themilestones we want to achieve in this calendar year is to accredit a group of highly qualified national,international, regional entities, to start working in the Green Climate Funds’ context bringing project andprograms to us.

State of Play Update from the Green Climate Fund
Tao Wang (Green Climate Fund)

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5. Results-based Payments

Update on REDD+ RBPs
The logic model (LM) and Performance Measurement Framework (PMF)
for REDD+ results-based payments (RBPs) was adopted in October 2014.

4 levels in the LM(a) Paradigm shifts objective(b) Impacts(c) Programme outcomes(d) Programme outputs

Linked to the Fund’sMitigation Logic Model
Defined specifically forREDD+ RBPs

I wanted to provide yo`u an update on the REDD+ results-based payments. The REDD+ land
use and forestry is one of the mitigation strategic areas. Also, very importantly, last October, the Green
Climate Fund Board has adopted this performance measurement framework and logic model for REDD+
results-based payments. It has four levels: paradigm shift objective, impacts, program outcomes, and program
outputs. The bottom two levels are defined specifically for REDD+ results-based payment. The top twolevels are linking to the fund’s overall mitigation logic model. With this, we can say that the Green Climate
Fund is really open to further work on the REDD+ results payment mechanism and trying to use thismechanism to maximize the results and impact of the fund in this area. Of course, this is just the start of thejourney.

Logic Model for REDD+ RBPs
Level

Results

Paradigm Shift

Shift to low-emission sustainable development pathways (forest cover and forest carbon loss isslowed, halted, and reversed)

Impacts (Fundlevel)

4.0 Reduced emissions from land use, deforestation, forest degradation, and through sustainable
management of forests and conservation and enhancement of forest carbon stocks

Programme
outcomes(national or subnational)

B. Reduced
A. Reduced
emissionsemissions(tCO2eq)(tCO2eq) fromfrom forest
deforestation
degradation

C. Reduced emissions
and increased
removals(tCO2eq)
through theconservation of forest
carbon stocks

Programme
outputs(national or subnational)

Reduceddeforestation

Reducedforest
degradation

Increasedconservation of forest
carbon stocks

REDD+ results-based payments (for verified tCO2e)

D. Reduced
emissions andincreased removals(tCO2eq) through thesustainable
management offorests
Increased
application ofsustainablemanagement
methods

E. Increased
removals (tCO2eq)
through theenhancement offorest carbon
stocksForest carbon
stocks enhanced

This gives you an overview of the logic model that has been adopted for the REDD+ results-basedpayments. In the next few months, we propose to develop the operational guidelines, how it works in a
concrete fashion the results-based payment on REDD+. Of course, as you have seen the excellent points
that Elly has made in the previous presentation, there are a lot of complex issues we need to think throughwhen we operationalize the REDD+ results-based payment for the Green Climate Fund. We should keep inmind that other funds and facilities already are quite advanced and have made a lot of progress in this aspect.

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We are aiming to build upon the experience and expertise that has been built over the years by the other funds
and facilities and really bring added value in this aspect.
6. Potential Priority Area: ForestryPotential Priority Area: Forestry• High mitigation potential at a relatively low cost:>7 GtCO2eq/year (27% of global mitigation potential)• Remarkable co-benefits, including adaptation areas(livelihoods, food security, health, water, biodiversity)• Opportunities in results-based payments (REDD+)• Limited support from existing climate channels

Thank you
Tao Wang
Director of Mitigation & Adaptation
twang@gcfund.org+82-32-458-6095(only accounts for 5% of current mitigation and 8% ofadaptation financing, combined with agriculture)

I wanted to just share with you part of the emerging findings coming out of an exercise that we areundertaking now, which is called analysis of the expected role and impact of the fund. We aim to present
these findings of analysis at the next board meeting in March. One of our findings is that forestry is reallyone of the potential priority areas that the fund needs to focus on because of the high mitigation potential at a
relatively low cost and strong resilience aspect. 70 gigatons per year represents 27% of the global mitigation
potential. Through intervention in forestry and land use activities, we can achieve remarkable co-benefits.
We have excellent opportunities in utilizing the results-based payment mechanism. Last but not least, we alsofind that there is limited support from the existing climate finance channels with only 5% of the mitigation
financing and 8% of adaptation financing is channeled to forestry and agriculture combined. That sends aclear signal that there is a lot more we can do in this area.
With that, perhaps I will conclude my presentation by saying that the Green Climate Fund is a newinstitution. We are fast growing andreally eager to engage with all of you and call on your support to workwith us to get highly qualified entities accredited and bringing forward high quality projects and programs andto deliver the results on the ground.