2nd Call for Proposals for JCM Model Projects in 2018

Guidelines for Submitting Proposals(Tentative translation)

27 August 2018
Global Environment Centre Foundation

Table of Contents
1.

Purpose ........................................................................................................................................1

2.

Contents .......................................................................................................................................1(1) Overview ........................................................................................................................ 1(2) Eligible Projects.............................................................................................................. 3(3) Countries of Priority....................................................................................................... 3(4) Who Is Eligible to Participate? ....................................................................................... 3(5) Requirements of International Consortium Members..................................................... 4(6) Costs Eligible for Financing ............................................................................................ 5(7) Amounts of Financial Support ........................................................................................ 6(8) Maximum Percentage of Financial Support .................................................................... 6(9) Implementation Period of Model Projects....................................................................... 6(10) Schedule ....................................................................................................................... 7

3.

Evaluation and Selection of Proposals ......................................................................................8(1) Selection of Model Projects ............................................................................................. 8(2) Evaluation of Proposals .................................................................................................. 8(3) Announcement of Selected Model Projects...................................................................... 8

4.

Procedure after Announcement of Selection.............................................................................9(1) Application for Contract of Finance................................................................................ 9(2) Conclusion of Contract of Finance .................................................................................. 9(3) Points to be Considered for Starting Model Projects....................................................... 9(4) Changes in Implementation Plans................................................................................... 9(5) Cost ................................................................................................................................ 9(6) Reports to be Submitted and its Review........................................................................ 10(7) Reimbursement of Finance ........................................................................................... 10(8) Management of Acquired Property ............................................................................... 10(9) Changes in Members of International Consortium ....................................................... 10(10) Cancellation of Contract of Finance.............................................................................11(11) Penalty for Injustice Acts ............................................................................................. 11

5.

Submission of Proposals ........................................................................................................... 11(1) How to Submit Proposals ............................................................................................... 11(2) Deadline for Submission of Proposals ............................................................................11(3) Documents to be Submitted ...........................................................................................11(4) Where to Submit Proposals? ......................................................................................... 12(5) Questions and Answers ................................................................................................. 12

6.

Treatment of Information.........................................................................................................12

7.

Note 13(1) Presentations on Model Projects ................................................................................... 13(2) Other ............................................................................................................................ 13

Annex 1 Categorization by applied technology type, Number of JCM model project by eachcountry ...............................................................................................................................14
Evaluation Criteria for Selecting JCM Model Projects in FY2018 ..............................................15

1. Purpose
Japan establishes and implements the Joint Crediting Mechanism (hereinafter referred to as “theJCM”) in order both to appropriately evaluate contributions from Japan to greenhouse gas (GHG)
emission reductions or removals in a quantitative manner achieved through the diffusion of low carbon
technologies, products, systems, services, and infrastructure as well as implementation of mitigation
actions in developing countries.
Starting from Mongolia in January 2013, Japan has established the JCM with 17 partner countries(Mongolia, Bangladesh, Ethiopia, Kenya, Maldives, Viet Nam, Lao PDR, Indonesia, Costa Rica, Palau,
Cambodia, Mexico, Saudi Arabia, Chile, Myanmar, Thailand and Philippines) as of 27 August 2018.
In order to support the implementation of candidate JCM projects, Ministry of the Environment,
Japan (hereinafter referred to as “MOEJ”) has been implementing the “JCM Model Projects(hereinafter referred to as “model project”),” which includes collaboration with projects supported by
the Japan International Cooperation Agency and other government-affiliated financial institution.
The purpose of this model project is to financially support the implementation of projects which
reduce GHG emissions by utilizing leading low carbon technologies in developing countries, and in
return, to acquire JCM credits for achievement of Japan’s GHG emission reduction target.
Moreover, based on the Overseas Development Strategy (Environment) compiled by Cabinet Officein June 2018, the JCM model project aims to promote the development of infrastructures in overseas,through the diffusion of leading low carbon technologies, such as renewable energy sources fordisaster resilience.

2. Contents(1) Overview
Participants in the model project shall implement a project to reduce GHG emissions utilizing
leading low carbon technologies, and also shall conduct measurement, reporting and verification(MRV) of GHG emission reductions.
The model project will finance part of an investment cost, as premises for seeking to deliver JCM
credits (at least half of issued credits) to the Government of Japan. The finance will be provided to a
Japanese representative participant in an international consortium composed of a Japaneseparticipant(s) and a JCM partner-country participant(s) which shall efficiently promote theimplementation of projects (hereinafter referred to as “international consortium”).
Participants shall conduct the following procedures of their relevant project:(a) Application for registration as JCM Project:
Participants shall apply their relevant project to be registered as a JCM project, including
developing a Project Design Document (PDD), conducting a local stakeholder consultation(LSC) as a part of development of PDD, and cooperating with a Third-Party Entity (TPE)
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which implements validation of their relevant project. In principle, application for registration
should be conducted within 1 year from the start of the operation of the facilities introducedby the project. In order to apply for registration of JCM project, it is necessary to develop an
appropriate JCM methodology approved by the Joint Committee. Participants shall develop a
JCM methodology by themselves or cooperate with JCM methodologies developers, byproviding information necessary for the development of JCM methodology(ies) applicable to
the relevant project, etc.
(b) Monitoring
Participants shall conduct monitoring to quantitate the effects of the facilities on GHG
emission reductions based on a MRV methodology expected to be approved by JCM andreport the results to MOEJ on an annual basis until the end of legal durable years of the
facilities as stipulated by the Japanese law (provided that the JCM bilateral document is valid
for the partner county). Please note that MOEJ may share the results of monitoring withpartner country government.
(c)Request for Issuance of JCM Credits
Based on the monitoring results mentioned in (b), participants shall request for issuance of
JCM credits, including development of a monitoring report, verification by a TPE, andsubmission of “JCM Credits Issuance Request Form” to a JCM Joint Committee. Also, theparticipants shall deliver at least fifty percent of the issued JCM credits to the account ofJapanese government.
Participants shall request for issuance of JCM credits for emission reductions achieved fromthe start of commercial operation to the end of legal durable years (provided that the JCM
bilateral document is valid (including the extension period). For example, if the expiry of JCM
bilateral document is extended from 2020 to 2030 and if the end of legal durable years is later
than 2030, participants shall request issuance of JCM credit for emission reductions achievedby 2030.) Participants are not prevented from requesting for issuance of JCM credits beyond
the legal durable years, however, in this case, participants are required to deliver at least fifty
percent of the issued JCM credits to the account of Japanese government.)
The first request for credit issuance shall be conducted within 1 year from the registration of
the JCM project in principle. After the first request, participants may request at once forissuance of JCM credits for emission reductions achieved during several years, but they shallrequest by the end of 2021 for emission reductions achieved by 2020, and by the end of 2031
for emission reductions achieved from 2021 to 2030.
In case the first request for credit issuance is in 2020, participants are waived from requestingfor issuance in 2020 and allowed to do so in 2021.

* For Japanese legal durable years, please refer to the website below (Japanese only):

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http://law.e-gov.go.jp/htmldata/S40/S40F03401000015.html* Costs related to (a) through (c) are not covered by this model project. However, if MOEJ
considers it’s necessary, it may be covered by a contract other than JCM model project by MOEJ
for development of methodologies, Project Design Documents (PDDs) and monitoring reports,
and validation/verification for the first credit issuance.

(2) Eligible Projects
A project eligible for the model project shall satisfy the requirements (a) to (d) listed below:
Projects that reduce energy-related CO2 emissions with leading low carbon technologies in(a)developing countries with which Japan has signed or has been consulting to sign a bilateral
document on JCM, and that are expected to contribute to achieving Japan’s emission reduction
target through the JCM;(b)

Projects contribute to the sustainable development in partner countries(c)

Reduction of GHG emissions achieved by the projects can be quantitatively calculated andverified; and(d) Facilities installed by the projects do not receive any other subsidy by the Government ofJapan.

(3) Countries of Priority
The model project shall prioritize the following countries that have already established the JCM(as of 27 August 2018):
Mongolia, Bangladesh, Ethiopia, Kenya, Maldives, Vietnam, Laos, Indonesia, Costa Rica,
Palau, Cambodia, Mexico, Saudi Arabia, Chile, Myanmar, Thailand and Philippines(*If other countries establish JCM subsequently, they shall be included.)(4) Who Is Eligible to Participate?
A participant which is entitled to request and receive financial support under the model project
shall satisfy the requirements (a) to (g) listed below:
A representative participant of the model project shall be a Japanese entity which is:(a)i.

a private company,ii.

an independent administrative institution,iii.

an incorporated association/foundation,iv.

a corporation established under the Japanese law, orv.

any organization admitted as appropriate by the Global Environment Centre Foundation(GEC) with approval from the Minister of the Environment, Japan(b) A participant described in (a) shall be the representative entity of an international consortium.
Note 1: International consortium is an association (no legal personality) that consists of aPage 3 of 20

Japanese entity mentioned in (a) and a foreign entity(ies), etc., with the objective ofeffectively implementing the project.
Note 2: Application for the model project shall be in the form of joint application by theinternational consortium, with the single Japanese entity to act as the representative
participant. Member(s) of the international consortium other than the representative
participant is called as a partner participant(s).
Note 3: Unless GEC approves, the representative participant and a partner participant(s) cannot
be changed after the selection of project.
A participant shall have developed structure for the implementation of the eligible project and(c)have technical capacity to appropriately implement the eligible project;(d) A participant shall have a financial basis to bear the costs necessary to appropriately
implement the eligible project;
A participant shall have adequate management structures and handling capacity for accounting(e)and other administrative work related to the eligible project;
A participant shall explain the contents, effect on GHG emission reductions, details of the cost,(f)investment plan, etc. of the eligible project;(g) A participant shall take a pledge regarding the exclusion of boryokudan, or organized crimegroups.
(5) Requirements of International Consortium Members
Japanese entity as a representative participant of an international consortium is responsible for(a)the followings:i.

Applying for the model project,ii.

Managing the progress in the project, developing the project implementation plan, andacting as the contact entity for accounting and other administrative work related to theproject,iii.

Introducing the leading low carbon technology,

iv.

Purchasing, installing and commissioning of the facilities during the construction period,and managing the facilities to be utilized according to the purpose of the model project
for the legal durable years of the facilities as stipulated by the Japanese law,v.

Return of the finance resulting from violations of the Financing Regulations by any of thepartner participants.

(b) All members of the international consortium are responsible for the followings:i.

To cooperate with JCM methodology developers by providing information required todevelop a methodology applicable to the project for GHG emission reductions;ii.

To cooperate with TPEs by providing materials and information required to efficiently
conduct validation of the abovementioned project and verification of GHG emission

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reductions at the project site;iii.

To reduce, monitor and calculate GHG emissions utilizing the facilities with leading low
carbon technology;iv.

To estimate the GHG emission reductions by the project, and to report it to GEC or MOEJ
annually until the end of the legal durable years of the facilities as stipulated by theJapanese law, which is unique to each project;v.

To request the Joint Committee to issue credits and take necessary actions such as
application for the project registration by the Joint Committee set up or to be set up by theGovernments of Japan and JCM partner country;vi.

To deliver to the account of Japanese government at least fifty percent of the JCM creditsof GHG issued corresponding to emission reductions achieved by the project for theabovementioned legal durable years;

vii. To manage the facilities with due care of a prudent manager for their legal durable years
as stipulated by the Japanese law in order to realize their efficient operation in accordancewith the purpose of the financial support even after the completion of the model project.
viii. To report to GEC in case that a constituent member is changed and to continue the above
obligations from i. to vii.
(c) Responsibility of consortium member who applies equipment lease.
If a consortium member provides equipment lease (lessor) to other consortium member (lessee),a draft lease contract and details of lease calculation shall be submitted to GEC as a part ofapplication documents to certify that the amount of financial support provided under thisprogram is deducted from the amount of principle of the equipment lease. If its lease period
expires before its legal durable years expire, the lessor shall maintain the equipment until theend of legal durable years by extending the lease contract or transferring the equipment to lessee.

(6) Costs Eligible for Financing
The model project covers the following costs. Note that the financial support is limited only tothose costs that can be verified as having been spent for implementation of eligible projects.
(a)Cost of main construction work(b) Cost of ancillary work(c)

Cost of machinery and appliances(d) Cost of surveying and testing(e)

Cost of facilities (including monitoring equipment)(f)

Cost of administrative work; and(g) Other necessary costs approved by GEC[Costs NOT eligible for financing]

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The following costs are not covered by the model project:(a)

Cost of removing existing facilities (including miscellaneous expenses related to removal
costs)(b) Equipment and consumable supplies/materials for maintenance of the facilities installed by
the model project, emergency facilities and equipment, safety equipment (such as fire
extinguisher, sprinkler, PPE etc.) and security equipment.
(c)

Civil engineering work and building (excluding structures that contribute to energy-related
CO2 emission reductions)(d) Cost related to a simple restoration of function, such as restoring the function to the state at
the time of installation by updating existing facilities(e)

Spare parts (excluding those used for testing and commissioning)(f)

Cost related to writing reports that are submitted to GEC as part of the model project(g) Cost of forward exchange contract and remittance charge(h) Cost related to land acquisition(7) Amounts of Financial Support
Total amount of the budget for this financing program is 69 billion yen for 3 years, of which thebudget for 2nd call for proposals is approximately 2 billion Japanese yen for 3 years.

Suggested sizeof a model project is, in principle, between 50 million yen and 2 billion yen in terms of the amount offinancial support.
Maximum amount of financial support shall be calculated by multiplying the aggregate amount ofeligible costs by the percentage listed in (8).
Actual amount of financial support shall be determined based on the cost which is verified as
actually spent for implementation of the project and be indicated in a notice to a representative
participant. There is no disbursement prior to the spending of cost.

(8) Maximum Percentage of Financial Support
Please refer to Annex 1 “Categorization by applied technology type, Number of JCM model
project by each country” for actual number of already selected projects.
Number of already selected project(s) using a

Percentage of financial support

similar technology in each partner country
None (0)Up to 50% (determined by participants)

Up to 3 (1 – 3)

Up to 40% (determined by participants)

More than 3 (>3)

Up to 30% (determined by participants)(9) Implementation Period of Model Projects
The implementation period of the model projects (i.e. the period for installing facilities andPage 6 of 20

completing all the payment) shall be from the date indicated on the Notice of Contract of Finance until
29 January 2021 at longest. Contract or purchase order prior to or after this period is not covered bythis model project.

(10) Schedule
Date

Items

Japanese Fiscal Year 2018
Monday, 27 August 2018

Announcement of 2nd call for proposals (GEC starts
accepting proposals from 27 Aug 2018. The proposals will
be reviewed first-come-first-served basis.

The selected

project will be publicly announced in order.)
After

the

evaluationof

Selection of model projects

proposals
Friday, 30 November (12:00

Deadline for submitting proposals (Application may closeJST)

before the deadline due to the availability of remaining
budget.)Review of application documents (technical aspects andWithin 90 days from the date ofpreliminary selection

project budget (including supporting documents for thebudget), etc.)
Notice of Contract of Finance issued to participants
Implementation of model projects

End of February 2019[1-year project] Completion of model projects

February – March 2019[1-year project]- Submission of final reports (due by 8 March 2019)- Inspection by GEC (document review and on-site
inspection, etc. if necessary)[2- or 3-year projects]- Midterm inspection by GEC (document review and onsite inspection, etc. if necessary)- Submission of midterm reports (due by 10 April 2019)Japanese Fiscal Year 2019
April 2019

Disbursement of financial support

End of February 2020[2-year project] Completion of model projects

February – March 2020[2-year project]- Submission of final reports (due by 10 March 2020)

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- Inspection by GEC (document review and on-site
inspection, etc. if necessary)[3-year projects]- Midterm inspection by GEC (document review and onsite inspection, etc. if necessary)- Submission of midterm reports (due by 10 April 2020)
Japanese Fiscal Year 2020
April 2020

Disbursement of financial support

End of January 2021

[3-year project] Completion of model projects

February – March 2021

[3-year project]- Submission of final reports- Inspection by GEC (document review and on-site
inspection, etc. if necessary)– March 2021

Disbursement of financial support

3. Evaluation and Selection of Proposals(1) Selection of Model Projects
GEC conducts call for request for proposals and evaluates the submitted proposals according toAnnex 2 “Evaluation Criteria for selecting JCM Model Projects” (hereinafter referred to as“Evaluation Criteria”). After the assessment and hearings, in consultation with MOEJ, GEC will selectmodel projects within the budget.

(2) Evaluation of Proposals
Firstly, proposals are assessed whether they satisfy all the criteria in “A. Eligibility Review” of
Evaluation Criteria. For those proposals that pass the first round of assessment, GEC will conducthearings based on the criteria in “B. Assessment Review” of Evaluation Criteria. Please note that
GEC may request additional documents during the evaluation.

(3) Announcement of Selected Model Projects
GEC will issue a notice to participants of selected model projects, and the information about theseselected projects (name of Partner Country and representative participant, title of project, and expected
GHG emission reduction, etc.) are publicly posted on MOEJ and GEC’s websites.
GEC will also inform participants that their model projects are not selected. Please note that resultof evaluation or reasons for not selecting the projects cannot be disclosed.

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4. Procedure after Announcement of Selection(1) Application for Contract of FinanceParticipants of selected model projects shall submit application documents for Contract of Financebetween the participants and GEC within 90 days since their selection was announced. If these
documents are not fully developed and not submitted within 90 days, their applied project may be
regarded as difficult to be implemented, and the selection may be cancelled.

(2) Conclusion of Contract of Finance
GEC shall examine the contents of the submitted documents (such as technical aspects and projects
budget, including supporting documents for the budget), and conclude Contract of Finance with theparticipants when these documents are appropriately completed. In case the Contract of Financecannot be concluded due to the grounds not attributable to GEC within 90 days after the date ofannouncement as a selected model project, GEC has a right to cancel the selection of the model project.
It should be noted that it will normally take 30 days for the examination by GEC. Hence, participants
are recommended to complete their documents at least 30 days before starting their model projects.

(3) Points to be Considered for Starting Model Projects
Starting a model project is possible only after the Contract of Finance is concluded. Participants
should note the following points to be considered.
(a) For the contracts which are necessary to implement the model project between participants andother entities, the date of concluding contracts must be later than the date of concluding
Contract of Finance.
(b) For the abovementioned contracts, participants should select other entities through competition
principle as long as it’s applicable.
(c) For the abovementioned contracts, payments to other entities should be completed by end ofeach fiscal year.

(4) Changes in Implementation Plans
When significant changes stipulated in the Financing Regulations will occur, participants shallseek an approval of changes in the implementation plan by GEC, and be approved prior to theoccurrence of the changes.

(5) Cost
For the cost covered by the model project, participants shall prepare and maintain account books.
The books shall separate other costs which are not covered by the model project, and record amountof income, expense and its usage, attached with relevant evidences of such income and expense.
The account books and evidences shall be stored for 5 years after the model project is completed.

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(6) Reports to be Submitted and its Review(a) Reports by each end of fiscal year
Participants shall submit reports by each end of fiscal year to GEC by 10th April(b) Report for completion of model project
Participants shall submit a report for completion of model project within 30 days from thecompletion of model project, or by 10th March of each year, whichever comes first. All
payments by participants to other entities in line with respective contracts shall be completed
by the submission of report for completion of model project.

(7) Reimbursement of Finance
GEC will pay financial support to the representative participants in response to the request for
reimbursement submitted by the participants at end of each fiscal year. The request is based on thecompleted portion of the model project by the end of each fiscal year. GEC will conduct on-site visits
for reviewing the submitted requests.

(8) Management of Acquired Property
Participants shall prepare a property ledger for the property acquired or gained its value throughthe model project (hereinafter referred to as “property”), in order to properly manage such property
and report the status of the property to MOEJ on an annual basis. When participants plan to use, sell,
exchange, lend, collateralize, dismantle or dispose of the property (limited to equipment or facility etc.
with a unit value of 500,000 JPY and over) for the purpose other than the model project, participants
shall seek an approval by GEC prior to these actions taken for the property. Note that such actions may
result in return of finance. In addition, even if the property is dismantled or disposed of upon theapproval by GEC, participants shall request for credit issuance for the emission reductions achieved
before the action is taken, according to the 2(1)(c) of this guidelines.
When participants plan to use, sell, exchange or lend property among members of the international
consortium in line with the purpose of the model project, participants shall report to GEC prior to theseactions taken for the property. In case the property is sold, participants shall not earn profit throughthe transaction.
All of the equipment, facility, etc. installed through the model project must have a sticker showingthat it is part of the JCM Model Project by MOEJ.

(9) Changes in Members of International Consortium
In case when the name or address of the participants are changed, or the participants are mergedwith other entities within 5 years from the completion of the model project, the representative
participants shall report it to GEC without delay.

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(10) Cancellation of Contract of Finance
When participants corresponds to one of the following actions, Contract of Finance may becancelled fully or partially. Participants shall return whole or part of the received finance.
(a) Violate relevant Laws, Financing Regulations, or order by GEC(b) Use the finance to other purpose that are not relevant to model project(c) Act inappropriately(d) No longer need to implement the model project due to the changes in the circumstances ofparticipants(11) Penalty for Injustice Acts
When false application, receiving of other subsidy by the Government of Japan, or any violations
to other Laws are identified, Contract of Finance may be cancelled and/or return of finance may beordered.

5. Submission of Proposals(1) How to Submit Proposals
A complete proposal must be submitted to GEC Tokyo Office in a sealed envelope by registeredmail, private courier service or by hand-delivery. Proposals submitted by fax, e-mail or via Internet
will be rejected.

(2) Deadline for Submission of Proposals
Friday, 30 November 2018 (12:00 JST)* Application may close before the deadline due to the availability of remaining budget.
* GEC accepts proposals 10:00 - 12:00 and 13:00 - 17:00 (except Saturdays, Sundays andpublic holidays)(3) Documents to be Submitted
Following documents must be included in a proposal. If a format is specified, please download theformat from the website for this call for proposals (available only in Japanese).
A complete proposal must be submitted in one original and 7 copies, and 1 CD-R containing theelectronic version of proposal must also be submitted along with the paper version.
(a)Form No.1 Application Form(b) Form No.2 Declaration by Representative Participant(c)Form No.3a Project Implementation Plan
* Supporting documents must be included according to the Checklist (Form No. 6).

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(d) Form No.3b Project Idea Note for the JCM Model Project* Without prior notice to a representative participant, this document may be shared withgovernment officials of a partner country where a project will be implemented. Also, we
may forward questions from the government officials and request for the answers.
(e)Form No.4 Budget (including supporting documents, such as quotations, of the budget)(f)Company information (such as company brochure) and certificate of incorporation of both
representative participant and partner participant(s)(g) Financial statement of both representative participant and partner participant(s) (audited,recent 3 consecutive years)(h) International consortium agreement
Draft International consortium agreement and status toward signing the agreement. Signed
agreement must be submitted to apply for Contract of Finance.
(i)Form No.5 Agreement on the Allocation of JCM Credits* Signed agreement must be submitted.

(j)Form No.6 Checklist for Submission of Proposal(k) Other supporting documents(4) Where to Submit Proposals?
A complete proposal must be submitted to the address below:
Postal address: Global Environment Centre Foundation Tokyo Office
4th Floor Hongo Ozeki Bldg., 3-19-4 Hongo Bunkyo-ku,
Tokyo 113-0033, Japan(5) Questions and Answers
Questions can be submitted via e-mail: jcm-info(at)gec.jp.

6. Treatment of Information
Documents including accounting documents and supporting documents (e.g. invoices, contracts,
proof of payments) etc. and electronic data of these documents submitted to GEC in accordance withthis Guidelines and Financing Regulations are treated with due care of prudent manager and used only
for: evaluation of proposals; conclusion of Contract of Finance; and determination of amount offinancial support.

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7. Note(1) Presentations on Model Projects
MOEJ will disseminate information on the overviews and results of the model projects to the world.
Therefore, GEC will ask participants to share their photographs of facilities installed by the model
projects which can be presented to public. Also, participants are encouraged to present their projects
publicly by themselves, and when doing so, participants should explain that the projects are
implemented as JCM Model Projects funded by MOEJ.

(2) OtherIn addition to this Guidelines, participants to the model project shall conform to the Act on theRegulation of Execution of Budgets Pertaining to Subsidies, etc. (Act No. 179 of 1955), the Order for
Enforcement of said Act (Order No.255 of 1955), and Financing Regulations.

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Annex 1 Categorization by applied technology type, Number of JCM model
project by each country

Page 14 of 20

Annex 2
Evaluation Criteria for Selecting JCM Model Projects in FY2018(Tentative translation)

April 2018
Global Environment Centre Foundation

Page 15 of 20

1.

INTRODUCTION
In order to select JCM Model Projects (hereinafter referred to as “model projects”) in fair
and transparent way, the Global Environment Centre Foundation (GEC) organized an external
committee and established this evaluation criteria, which was approved by the committee.
Based on this set of criteria, GEC will consult with the Ministry of the Environment, Japan,
and select model projects with consideration of technological distributions etc.

2.

PURPOSE OF MODEL PROJECT
The purpose of model projects is to financially support the implementation of projects(including collaboration with projects supported by the Japan International Cooperation
Agency (JICA) and other government-affiliated financial institution) which reduce GHG
emissions by utilizing leading low carbon technologies in developing countries, and in returnseeks to acquire JCM credits for achievement of Japan’s GHG emission reduction target.

3.

OVERVIEW OF CRITERIA
Proposals for model projects will be reviewed based on the following criteria. Hearings are
conducted for applicants who satisfy all the eligibility criteria.

A. Eligibility Review
A proposal will be reviewed whether it meets the following eligibility criteria. When allof these eligibility criteria are met, the proposal will proceed to the “B. Assessment Review.”
If any of these eligibility criteria is not met, the application will be rejected.

1)

Does the applicant meet the criteria for an eligible participant?
The applicant shall meet 2.(4) in the “Guidelines for Submitting Proposals”.

2)

Is the model project expected to reduce emissions of GHG including energy-related CO2
through JCM?
The technology applied in the project shall reduce emissions of GHG including energyrelated CO2, that means: Amount of emission reductions can be quantitatively calculated; The emission reductions are not result of decreased activities, such as lower production;and The emission reductions from the project can be clearly separated from the emission
reductions by other factors that may influence the emissions.

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3)

Does the financial support promote investment in projects with leading low carbon
technologies etc. by private companies, etc?

4)

Can the applicant objectively show the superiority of the technology introduced in themodel project? This means: The evidence of its superiority, such as data or literature with comparative, should bepresent; or The technology should demonstrate high performance in terms of energy savings, etc.
specified in a standard of the country where the model project is implemented(hereinafter referred to as “partner country”).

5)

Can the applicant objectively show that the technology is not adequately diffused in thepartner country?

6)

Is the technology internationally in practical use and can be introduced in the partnercountry? This means: The technology should be realized in other project(s) (a track record of commercial
operation or demonstration project etc. will be reviewed); or The facility or equipment using the technology should be commercially manufactured(Catalogues, specification etc. will be reviewed.).

7)

Is there a high potential that the technology is diffused in the partner country after thismodel project is implemented? Also, does the applicant have a concrete strategy topromote autonomous technology diffusion on a commercial basis?

8)

Does the model project contribute to the sustainable development in the partnercountry?
 The installation and operation of the facility/equipment shall comply with theenvironmental laws and regulations of the partner country and refer to international
practices and guidelines regarding the environmental protection (air pollution, watercontamination, waste treatment, noise/vibration, ecosystem etc.).
 In case the model project is going to introduce a similar technology, the project shallmeet the eligibility criteria of approved JCM methodologies for the similar technology
of both the partner county in which the project will be implemented and other partnercountries.
 The model project should contribute to the sustainable development of the partner

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country with reference to the partner country’s policy, etc.

9)Is the expense for the model project appropriately estimated?
 The expense should be estimated using the same or similar project implemented in thepast; or
 The expense should be based on the actual design and specification.
 The evidence for estimation of personnel expense and travel cost is clear andappropriate.

10)

If the model project is implemented in collaboration with other project that JICA or
government-affiliated financial institution provides equity or loan, Can the applicant
draw a clear line between the part covered by this financial support (applicable to theextent) and the ODA financed project by JICA or government-affiliated financial
institution?

11) The facility/equipment introduced by the model project shall not receive any otherfinancial support from the Government of Japan.

B. Assessment Review
After passing the eligibility review, the proposal will be reviewed and scored using thefollowing assessment criteria. The project in the following countries which have alreadyestablished the JCM will be prioritized (as of 6 April 2018):
Mongolia, Bangladesh, Ethiopia, Kenya, Maldives, Vietnam, Laos, Indonesia,
Costa Rica, Palau, Cambodia, Mexico, Saudi Arabia, Chile, Myanmar, Thailand andPhilippinesi.

Robustness of the project implementation (40 points)
1)

Management and operational capacities of a representative participant and partner
participant(s) to implement the project (15 points)

2)

Appropriateness of the project plan (including the schedule, decisions for the project
location, concession and license for the project implementation, and status of concludinga Power Purchase Agreement in case of a power generation project) and financial plan(including the actual amount of investment by each participants and certainty of financing
arrangements) (10 points)

3)

Profitability of the project, including economic performance, forecast of cash flow andPage 18 of 20

payback period (For a tentative indicator, the payback period is preferred to be 3 years or
longer with the financial support.) (5 points)

4)

Status of the project implementation structure (including the decision on roles of each
entity in the international consortium) (5 points)

5)

Appropriateness of financial plan (The amount of investment by each entity is clearlystated, including the certainty of financial arrangement.) (5 points)

ii.

Amount of emission reductions of energy-related CO2, and cost-effectiveness of emission
reductions of CO2 and GHG (40 points)
Cost-effectiveness of financial support necessary to reduce 1 ton of CO2 and GHG emissions
will be evaluated. In principle, cost-effectiveness of GHG emission reductions is expected
to be 4,000 JPY/tCO2 or better. However, if the number of solar power projects in a partnercountry are more than 5 in Annex 1 “Categorization by applied technology type, Number of
JCM model project by each country”, cost-effectiveness is expected to be 3,000 JPY/tCO2
or better.

1)

Emission reductions of GHGs (15 points)
Total emission reductions [tCO2]= GHG emission reductions per year[tCO2/y] × legal durable years of the

facility/equipment as stipulated in the Japanese law [y]2)Cost-effectiveness of emission reductions of GHGs in terms of financial support (25points)Cost-effectiveness for GHG emission reductions [JPY/tCO2 equivalent]=

Amount of financial support [JPY]Emission reductions of GHG (tCO2equivalent/y) × legal durable years [y]Above calculations should be performed in a rational way, such as using an approved JCM
methodology or spreadsheet included in the Guidebook for calculating the effectiveness ofglobal warming counter measure projects, and so forth. Also, refer to the relevant Japanese law
for legal durable years.

iii. Potential of the dissemination of the technology and strategy (10 points)
 Implementation of the model project leads to the autonomous diffusion of the technology
on a commercial basis in the future, in consideration of following points:➢

Size of the market for the technology used in the model project in the partner country

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➢Potential of the technology to be diffused in the partner country➢

A strategy to promote the technology

 Consistency in relation to the partner country’s relevant policy
 System for supporting the entities in the partner country for the operation and maintenanceof the facility/equipment

iv. Concept for developing JCM methodology and monitoring (10 points)
Eligibility criteria, calculation of reference emissions, calculation of project emissions, andmonitoring procedures and structure are appropriate.

***

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