B: THEORY OF CHANGE AND PROGRESS TOWARDS OUTCOMES



Title: Clean Energy Fund Technical Assistance (CEFTA) ProgrammeProgramme Value: ?10 million (2016-2018)Extension Value: ?9.5 million (2019-2021)Review Date:April 2021Start Date: January 2020End Date:December 2020Programme End Date:December 2021Summary of Programme Performance DescriptionScaleOutputs substantially exceeded expectationA++Outputs moderately exceeded expectationA+Outputs met expectationAOutputs moderately did not meet expectationBOutputs substantially did not meet expectationCYear201620172018201920202021Overall Output ScoreAAAA ARisk Rating ModerateModerateModerateModerateModerateLink to Business Case: Link to results framework: Link to previous Annual Review (if appropriate) A. SUMMARY AND OVERVIEW Description of programmeThe Clean Energy Fund Technical Assistance (CEFTA) is a BEIS contribution to the multi-donor Asia Development Bank Clean Energy Fund. The UK has invested ?19.5 million for Technical Assistance (TA) activities in the CEF (which has a total value of $85.9m) since December 2015, the programme is multi-donor with additional contributions from Australia, Norway, Spain and Sweden and is delivered by the Asian Development Bank (ADB) under their Clean Energy Financing Partnership Facility (CEFPF). The ADB Clean Energy Fund aims to improve energy access, ensure energy security and support the transition to clean technologies through cost-effective investments that contribute to greenhouse gas mitigation. BEIS funding is earmarked for TA only and is used for renewable energy and energy efficiency projects in developing countries across Asia-Pacific. TA activities supported by BEIS funding include project planning and preparation, feasibility studies, capacity building workshops and seminars, training, policy and regulatory support, and knowledge dissemination.Summary of progress and supporting narrative for the overall score in this reviewThis is the fifth Annual Review of CEFTA, which assesses performance from January 2020 to December 2020. CEFTA has scored ‘A’ as outputs have met expectations. A Project Completion Report will be undertaken by end March 2022. There have been strong results reported since the UK joined the CEF, including support to 22 countries (cumulatively 34 countries have been supported since the CEF was set up in 2007) and 19 of these countries have been supported in amending or developing policies or regulations related to clean energy development. In 2020, 6 new TA projects were supported, 2 of these were regional and the others were in Uzbekistan, Sri Lanka, Indonesia, and Cambodia – contributing to the 22 countries that have been supported since the UK joined CEF in December 2015. These new projects, including ongoing projects approved between 2016 and 2019, contributed to the 2020 results (Annex B).CEFTA has broadly met expectations at output level and has shown some strong results at the outcome level with regard to mobilising public finance. There were some impacts of COVID-19 to the delivery of certain activities which should be mitigated against in the final year of BEIS’ involvement in the fund. In 2020, CEFTA met its targets for Output 2 (Increase use of Renewable Energy (RE) and Energy Efficiency (EE) technologies in the public sector) and exceeded its targets for Output 3 (Conditions for raising RE and EE ambition strengthened). Output 1 (Increased capacity of personnel within public and private sector institutions to develop clean energy projects and policies) is scored a B due to the impact of COVID-19 on learning activities. In addition to meeting output targets, CEFTA also exceeded expectations at outcome level in relation to mobilising finance to fund downstream clean energy projects. In 2020 the level of total public finance leveraged was $533.87m and $372.30m leveraged from ADB and the non-ADB public sector, respectively. In 2019 BEIS recommended that CEF as a fund increase the share of finance mobilised by the private sector and thus for the first time CEFTA has specifically tracked the volume of private sector support leveraged to finance downstream clean energy projects as a direct or indirect result of CEFTA interventions. In 2020 CEF mobilised $11.83m private finance through a TA linked to a project which set up a dedicated green financing platform (GFP) in the People's Republic of China.Progress against 2020 recommendations CEFTA has made good progress against the recommendations made in the 2019 Annual Review. A number of recommendations made in 2019 carry-over to the reporting period of this Annual Review. In 2020 BEIS and ADB reviewed the programme logframe, to better measure the impact of technical assistance on the energy sector. The new logframe has been used to assess programme performance for this Annual Review.Focus in 2021.Programme management should focus on the following three areas for the remainder of the programme:Governance - The Memorandum of Understanding (MoU) between the UK and ADB ends in December 2021. ADB and BEIS should agree a governance process for closing CEF including arrangements for completing project disbursements and monitoring and disseminating results after 2021.COVID-19 – ADB should ensure that the regional learning and training activities from technical assistance projects that could not go ahead in 2020 due to COVID-19 are programmed in to the 2021 work plan and include COVID-19 impacts in its review of the ADB Design and Monitoring Framework.Dissemination - BEIS and ADB should agree and implement a plan to disseminate CEFTA’s role in facilitating capital project in the clean energy sector across the region, including how ADB will showcase CEFTA at COP26. Progress against recommendations from the last review (2019):IDRecommendationProgress1ADB should ensure the successful legacy of the CEF’s work by proactively seeking greater opportunities to capture and disseminate lessons learned at events and in projects. To advance this work, the ADB should develop and share effective stakeholder engagement plans with BEIS that include targeted events and how success stories at the fund-level and project-level will be disseminated. The plans should also include how participant feedback from the events will be captured and acted upon (by 31st December 2021).In Progress – ADB has undertaken a number of activities at key regional events and included external dissemination activities in the 2021 CEFPF workplan. This recommendation has been reviewed and taken forward for 2021. 2The ADB should work with BEIS to develop clear protocols for bringing in HMG staff in British Embassies and High Commissions into policy discussions and the planning of key events in supported countries, starting with BEIS ICF priority countries in Asia (by 31st December 2021).In Progress - Progress against this recommendation is ongoing. BEIS attends UK climate coordination meetings with UK embassy teams across the Asia-Pacific region and updates embassy teams with information from ADB. A specific protocol with British Embassies is no longer considered necessary. ADB will provide a communication and engagement plan in 2021 (see recommendation 1 below) 3The ADB should increase the amount and share of private sector finance leveraged in the Clean Energy Fund beyond wider ADB finance from 1.2% ($50 million) to 5% (by 31st December 2020).Not achieved – The amount and share of private sector finance leveraged in CEF beyond wider ADB finance in 2020 was 1.2% ($11.83m). To note, the 1.2% ($50m) value reported in 2019 was an expected result. ADB have reported that this expectation was not achieved subsequently. The recommendation focused on private finance leveraged by CEF, which is difficult to attribute to CEFTA specifically. The CEFTA logframe was updated accordingly to improve private finance reporting by CEFTA. 4The ADB should improve its performance on gender equality to facilitate the greater participation (and employment where relevant) of women in supported TA projects. To measure this, all CEF TA projects should include gender-mainstreaming or gender-benefits (by 31st December 2021).In Progress - five of the six approved projects in 2020 were gender sensitive and are expected to demonstrate greater participation of women.The logframe mainstreams gender considerations across relevant indicators. The ADB Strategy 2030 (launched in 2020) specifies that at least 75% of ADB’s committed operations will promote gender equality by 2030. 5BEIS will develop indicators to formally assess against value-for-money (VfM) (by 31st July 2020).Recommendation re-assessed - BEIS and ADB have reassessed the recommendation. VFM has been in-line with the original business case and the extension business case. The new logframe provides an improved assessment of the value of inputs in achieving the programme’s objectives.6BEIS will consider reporting against new, additional TA indicators and publish the revised logframe (by 31st July 2020).Achieved – The logframe was revised in 2020 to ensure full alignment with the theory of change and ensure that the level of ambition was appropriate for the final year of delivery. Major lessons and recommendations for the year ahead Several recommendations (1-4) made in 2019 are due to be delivered across the final two years of programme delivery (by December 2021). These recommendations have been updated and carried over for this Annual Review. The priorities for the year ahead are 1) to clarify governance processes for closing CEF and disbursing BEIS funds by December 2021; 2) to agree and implement a plan to disseminate lessons learnt and the results of CEFTA in facilitating capital investments, including at COP26 and 3) to mitigate any residual impacts of COVID-19 on the delivery of TA activities in 2020. IDRecommendationDelivery date1Carried over and updated from 2020 Annual Review - ADB to develop a communications and engagement plan to identify relevant events (including COP26) for disseminating CEFTA activities and results. To advance this work, ADB should utilise the findings of the independent evaluation of the CEF being funded by another CEF donor, NORAD, in 2021. 31st July 20212ADB to report on gender-mainstreaming or gender-benefits in all CEFTA projects to be used in the Project Completion Report.By 31st November 20213ADB and BEIS to agree governance process for closing the CEFTA including arrangements for completing project disbursements and monitoring and disseminating results.By 31st July 20214ADB to deliver the regional learning and training activities from technical assistance projects that could not go ahead in 2020 due to COVID-19 are programmed in to the 2021 work plan and considered in the review of the ADB Design and Monitoring Framework By 31st July 20215In addition to continue to manage the short-term impacts of COVID-19, ADB should look in detail at the longer-term impact of the pandemic on the original programme expectations and share its risk mitigation strategy. ADB should ensure that the regional learning and training activities from technical assistance projects that could not go ahead in 2020 due to COVID-19 are programmed in to the ADB 2021 work plan.By 31st July 20206ADB to review data collection processes for participant satisfaction with training activities (the data source for Output indicator 1.1) and set standards for training conveyors to ensure accurate data is obtained from surveys at training events.By 31st June 2021B: THEORY OF CHANGE AND PROGRESS TOWARDS OUTCOMES Summarise the programme’s theory of change, including any changes to outcome and impact indicators from the original business case.CEFTA aims to achieve transformational change by developing and implementing technical assistance projects that lead to an improved investment climate, the development of bankable renewable energy and energy efficiency projects, and improved overall flows of climate finance. CEFTA does this by: i) increasing institutional capacity and capability; ii) promoting regional knowledge sharing; iii) increasing support and interest in renewable energy and energy efficiency technologies; and iv) creating enabling environments and improving governance.The programme impact statement remains the same as the original and extension business case, however during the logframe review that was conducted in 2020 the outcome statement was amended. Rather than measuring improved climate finance architecture, which was taken from the theory of change, but did not reflect the actual result of the interventions, the outcome statement now measures strengthened capacity and the increased uptake of renewable energy and energy efficiency across the target geographies. The programmes outcome statement now reads, ‘strengthened country led development and financing of EE and RE projects’.Describe where the programme is on/off track to contribute to the expected outcomes and impact. What action is planned in the year ahead? A key expected impact of the programme is to reduce greenhouse gas emissions (GHG) through capital projects that were initiated by CEFTA projects (Impact indicator 1). The key programme outcome is to promote strengthened country-led development and financing of energy efficiency and renewable energy projects, which is measured by assessing the development and financing of energy efficiency and renewable energy projects (Outcome indicator 1.1) and the total public and private sector support for clean energy projects (Outcome indicator 1.2 and Outcome indicator 1.3).The expected impact of CEFTA is measured by the volume of GHG emissions reduced as a result of the capital projects that are initiated following CEFTA projects. The extension business case expected that CEFTA would reduce 400,000 tCO2 per year between 2019-2021 (12,000,000 tCO2 cumulatively). The value of expected emissions reductions can vary by year because the results are determined by a small number of projects that vary significantly in their total emissions reductions (for example, a pilot project will achieve a much lower value of emissions reductions that a large-scale utility project). In 2020, the proposals for capital projects received by ADB as a direct or indirect result of CEFTA was 41,200 tCO2 GHG emissions. This is because projects receiving support from CEFTA in 2020 - responding to country demand - were associated with lower direct emissions reductions (i.e. in 2020, CEFTA supported technical assistance activities that established a pilot solar PV project in Uzbekistan, install additional rooftop solar PV systems in Sri Lanka and the preparation of a sector development program for Cambodia). However, CEFTA is still broadly on track to achieve its cumulative expected lifetime results by 2021, as ADB expects that 800,000 tCO2 will be reduced by 2020 (400,000 tCO2 in 2019 and 2020 respectively), and 746,899tCO2 has been achieved due to results exceeding expectations in 2019. ADB informed BEIS in December 2020 that some CEFTA projects would be extended beyond their original expected completion dates due to logistical issues caused by the COVID-19 pandemic. ADB do not anticipate any further project extensions, nor do they expect the extensions to have any impact on the delivery of the programme. Has the logframe been updated since the last review? BEIS and ADB undertook a review of the programme log frame in 2020 to ensure full alignment with the theory of change and that the level of ambition was appropriate for the final year of delivery. The review also involved ensuring the output statements were accurate and specific. The focus of the review was largely at the output level, and therefore new output statements and indicators were drafted – a number of the indicators measure the same aspect of programme delivery as the prior logframe and therefore milestones could be carried over. For new indicators, either new milestones were agreed (outputs 1.2, 2.1, 2.2 and 3.1) or 2020 results were agreed to form a baseline (outputs 1.1, 3.2) ahead of the final assessment in the project completion report in 2021.Justify whether the programme should continue, based on its own merits and in the context of the wider portfolio.Performance against the output indicators has resulted in the programme receiving an overall score of ‘A’ for the fifth year in a row. Overall, the CEFTA programme is performing well on capacity building and providing in-country support, supporting project preparation, facilitating policy support, and continuing to ensure that a pipeline of high-quality technical assistance projects can be supported. In 2020, COVID-19 affected the achievement of Output 1 which measures capacity building. Following the inclusion of two new outcome indicators in the logframe for the UK’s ?9.5 million extension of funding to the CEF in 2019 it is also possible to assess that the programme is performing well in terms of finance leveraged. Based on the analysis of performance against the programmes outcome statement, scores against the output indicators and a strong indication that the programme is on track to achieve transformational change and achieve targeted impact results in relation to GHG emission reduction, there is strong case for the programme to continue to operate for the final year of delivery. C. DETAILED OUTPUT SCORINGOutput Title Increased capacity of personnel within public and private sector institutions to develop clean energy projects and policies Output number: 1Output Score: BImpact weighting (%): 40%Weighting revised since last AR? NoRisk ratingModerateRisk revised since last AR?YesIndicatorsProgress 2020 target2020 achieved1.1 Percentage of key in-country stakeholders per workshop disaggregated by gender, (such as decision makers, senior managers or those deemed influential in their organisations) reporting positive feedback from attending formal CEFTA trainingUnassessedBaseline - 80% 7 training activities were held for a total of 171 participants across 6 projects, 50 (29%) of participants were women.108 participants reported positive feedback, of which 30 (28%) were women and 78 (72%) were men.In total, 3 of the 7 training events had 100% of participants reporting positive feedback. 2 of the training events had 98% of participants reporting positive feedback4 training events delivered under the technical assistance project ‘Advanced Renewable Energy Technology Demonstration’ in China, had an average 56% of participants at the four training events cited positive feedback.1.2 Number of key stakeholders, disaggregated by gender and private/public sector (such as decision makers, senior managers or those deemed influential in their organisations) who report benefiting from CEFTA regional learning activities.300 stakeholdersNot Achieved - 95 stakeholdersThis indicator was partially achieved because only one regional learning activity took place in 2020 with 95 stakeholders (23 women/72 men). ADB had planned to deliver a number of regional learning activities at the Asian Clean Energy Forum (ACEF) however due to COVID-19 the event was held virtually and therefore the agenda was streamlined, meaning the ACEF did not request support from CEFTA for learning activities in 2020. Briefly describe the output and provide supporting narrative for the score. Output 1 measures whether CEFTA’s formal training and broader learning events lead to an increase in institutional capacity and capability of personnel within public and private institutions, which at the outcome level should contribute to an improved climate finance architecture in the public and private sectors of targeted geographies. This output has scored a B as milestones were only partially met because the restrictions imposed in response to COVID-19 impacted the ability for ADB to deliver expected regional learning activities planned for June 2020. There have been added difficulties to the delivery of training due to the impacts of COVID-19, ADB adjusted its delivery of training due to COVID-19 through online meetings, forums, and workshops using MS Teams, Zoom, and other platforms, or by postponing some activities until travel restrictions were loosened.This is the first year that ADB has collected gender-disaggregated data. Initial findings suggest that there is more work to be done to increase the active participation of women in capacity building events.This was the first year that CEFTA tracked Output 1.1, which is a new indicator under the revised logframe and therefore was not assessed in 2020. The training delivered in 2020 was both regional and country specific (China and Uzbekistan) and focussed on increasing knowledge and capacity for the use of specific renewable energy technologies such as a floating solar PV. The full list of training delivered can be seen from Table 1 below. Of the six training events that collected feedback data (out of a total of 7 training events), all six collected gender disaggregated data. Overall, men had slightly higher rates of giving positive feedback (64%) than women (60%) and the majority of training participants were men (71% were men and 29% were women). Project TitleType of training deliveredPRC: Strengthening Capacity in the Implementation of the Green Financing Platform for the Greater Beijing–Tianjin–Hebei RegionIncreasing capacity to enable expertise in financial evaluations of clean energy technologies, new technology promotion, environmental impact and social security assessments, project performance evaluations and foreign exchange risk managementREG: Promoting Low-Carbon Development in Central Asia Regional Economic Cooperation Program CitiesBlock Heater Business FairCHINA: Preparing Air Quality Improvement Program in the Greater Beijing-Tianjin-Hebei RegionIncorporating environmental & social safeguards and Gender into air quality improvement projects.CHINA: Advanced Renewable Energy Technology Demonstration(1) knowledge about heating system design; (2) knowledge about renewable energy technology; (3) knowledge about business models involving the private sector; and (4) knowledge about the current environmental policy trends in China.REG: Floating Solar Energy DevelopmentTechnical aspects of floating solar PV, environmental and social impact assessment, and general aspects of procurementUZB: Enhancing Climate Resilience of Hydropower PlantsInception workshop, including capacity building and knowledge sharingTable 1: Training delivered under CEFTA in 2020CEFTA did not achieve its target for Output 1.2 due to the cancellation of a CEFTA learning event at the Asia Clean Energy Forum 2020. However, 95 participants of a regional technical assistance project (Integrated High Impact Innovation in Sustainable Energy Technology) reported that they benefited from CEFTA learning activities through the virtual workshop delivered in September 2020. Describe any changes to this output and any planned changes as a result of this review. The language of this output has been improved to add specificity, from ‘increased institutional capacity and capability’ to ‘increased capacity of personnel within public and private sector institutions to develop clean energy projects and policies’. As part of the logframe review the indicators that measure capacity building were amended to their current form to ensure that results demonstrate the quality of training and learning activities rather than the number of activities executed. The source of the data collected for this output has also changed to improve the accuracy of measuring capability and capacity of personnel. ADB now send questionnaires to the conveyors of training and learning activities to obtain the feedback of attendees measured through surveys although there have been some quality issues with the data collection, which has contributed to the 56% feedback result for output 1.1. ADB have noted that at the training delivered in China under the ‘Advanced Renewable Energy Technology Demonstration’ positive feedback was recorded if a participant had a formal speaking slot or actively participated in the discussion section of the training event. ADB should review data collection processes for participant satisfaction with training activities and set standards for training conveyors to ensure accurate data is obtained from surveys at training events. Recommendations for the year ahead:ADB should ensure that the regional learning activities that could not go ahead in 2020 due to COVID-19 are programmed in to the 2021 work plan for CEF and considered in the review of the ADB Design and Monitoring Framework by July 2021.Output Title Increase use of Renewable Energy (RE) and Energy Efficiency (EE) technologies in the public sector Output number: 2Output Score: A+Impact weighting (%): 40%Weighting revised since last AR. YesRisk ratingMinorRisk revised since last AR?YesIndicators2020 target2020 achieved2.1 Number of CEFTA projects prepared that resulted in concessional loans from ADB1Exceeded – 3Concessional loans were granted for three projects:Indonesia: Geothermal Power Generation Project. China: Air Quality Improvement in the Greater Beijing–Tianjin–Hebei Region—Green Financing Scale up Project. China: Xiangtan Low-Carbon Transformation Sector Development Program.2.2 Improved quality and quantity of proposals for support received by the ADB5Achieved – 6The Clean Energy Financing Partnership Facility received 11 fund applications in 2020, of which six were endorsed by the Clean Energy Working Group for funding under CEF.This included:Supporting Sri Lanka’s bid to increase the use of solar power and other renewable energy sources.Regional support to build disease resilient and energy efficient centralized air conditioning systems. Promoting Distributed Solar Photovoltaic Power for Enhanced Access to Energy in Uzbekistan.Implementation Support for Geothermal Power Generation Project in IndonesiaPreparation of a Sector Development Program to Catalyze Energy Efficiency in CambodiaA regional project on Marine Aquaculture, Renewable Energy, Reefs, and Ecotourism for Ecosystem ServicesBriefly describe the output and provide supporting narrative for the score. This output measures whether CEFTA projects are leading to an increase in investment and interest in renewable energy and energy efficiency technologies in the Asia pacific region. This output has scored an A+ because CEFTA exceeded the number of concessional loans granted and the quantity and quality of proposals for support received by ADB for financing as a result of CEFTA. Output indicator 2.1 measures the number of concessional loans that were approved for capital/infrastructure projects as a direct or indirect result of support provided through CEFTA. a summary of the projects can be found in Annex A. The three concessional loans have been granted to projects that also contribute to CEFTA’s GHG emission reduction and financed leveraged (public and private) targets. Proposals counted under Output Indicator 2.2 are those that have been screened and approved by the ADB Climate Change Steering Committee and are considered to be of a high standard. The proposals received by ADB reflect an increased interest and capacity to develop bankable projects in the renewable energy and energy efficiency sectors across the region. The Clean Energy Financing Partnership Facility (CEFPF) received 11 fund applications in 2020, six of which were endorsed by the Clean Energy Working Group for funding under the Clean Energy Fund (CEF). Three are classified as Knowledge and Support and the remaining three as Transaction (Project Preparation) projects. This included support to the CEF project: Sri Lanka: Rooftop Solar Power Generation which was provided with additional financing of $250K from the CEF.?Progress on recommendations from the previous AR (if completed), lessons learned this year and recommendations for the year ahead:There were no specific recommendations made regarding this output last year. For the year ahead ADB should consider how they can successfully disseminate CEFTA’s role in facilitating capital projects in the clean energy sector across the region, using the lessons learnt and results as strong tools for demonstration effects. ADB and BEIS should consider how these results can be shared at COP26. Output Title Conditions for raising RE and EE ambition strengthened Output number: 3Output Score: A+Impact weighting (%): 20%Weighting revised since last AR? Yes Risk ratingMinorRisk revised since last AR?YesIndicatorsProgress 2020 target2020 achieved3.1 Number of policies, regulations, legislations, or standards improved through CEFTA support1Exceeded – 73.2 Number of new market actors entering energy sector cited with strong supporting evidence in TA project completion reports.Unassessed (new indicator)3Briefly describe the output and provide supporting narrative for the score. Output 3 measures how CEFTA activities contribute to the creation of enabling environments in the renewable energy and energy efficiency sectors, which ultimately leads to the development of renewable energy and energy efficiency investment projects. This output has scored an A+ as results have exceeded expectations. Output 3.1 achieved 7. Two CEFTA projects (one regional project and one in China) led directly to the development of 6 new policies. A further CEFTA project (in Indonesia) resulted in the revision and improvement of existing legislation. Examples include:In Kazakhstan, CEFTA conducted a low carbon city assessment for Nur-Sultan which was used as an input for the city’s 2050 Low Carbon Strategy. Following this initial project, a pre-feasibility study was supported which informed Kazakhstan’s Low Carbon Action Plan and Roadmap. In China, CEFTA supported a low carbon transformation sector development programme which facilitated the development the Green Procurement Policy within the Xiangtan municipal government. The Green Procurement Policy institutionalises the process of public authorities in procuring goods, services and works to reduce carbon emissions.In Indonesia CEFTA supported the municipality of Denpasar in Bali to develop, implement and finance an energy efficiency pilot project under a Public Private Partnership scheme. At the national level, the project also supported the directorate of renewable energy and conservation to amend the national Energy Efficiency Framework Regulation to include Energy Service Companies (ESCOs) and Minimum Energy Performance Standards (MEPS).Output 3.2 measures the number of new market actors entering energy sector. This indicator is unassessed in 2020. As a result of the technical assistance project aimed at Strengthening Capacity in the implementation of the Green Financing Platform for the Greater Beijing–Tianjin–Hebei Region, ADB reported strong evidence that three organisations had entered the energy sector. This has established a baseline target of 3 per annum which will be used to assess performance in the Project Completion Report.Describe any changes to this output, and any planned changes as a result of this review. This is a new output which was drafted as part of the logframe review process in 2020 to better understand how CEFTA activities are contributing to an increased interest in clean energy and whether activities are leading to the creation of enabling environments within the clean energy sector. There are no planned changes as a result of this review.Progress on recommendations from the previous AR (if completed), lessons learned this year and recommendations for the year ahead:No specific recommendations were made in regard to this output. In the year ahead ADB should consider how they can successfully disseminate the strong performance of CEFTA in supporting the development of regulations and policies in the clean energy sector across the region, using the lessons learnt and results as strong tools for demonstration effects. ADB and BEIS should consider how these results can be shared at COP26. D: PROJECT PERFORMANCE NOT CAPTURED BY OUTPUTS Progress against outcomes: CEFTA aims to support economies and sector-wide changes to deliver results by creating enabling environments and capabilities for the public and private sector to finance clean energy projects, this is measured at the outcome level. In 2020 CEFTA activities have led to the financing of four capital projects totalling $918.08m across the Asia Pacific which have been financed by the public and private sector. Dissemination: In 2020 ADB has focussed on improving dissemination activities for the whole facility in response to donor feedback at the 2019 annual meeting. This included the promotion of activities and opportunities within CEF and other funds at the ADB Energy Sector Group Updates. In 2020, a CEFTA funded programme was chosen to be an ‘impact story’ on ADB’s website and social media accounts. Externally, ADB identified opportunities to share the role and achievements of CEF and other CEFPF funds at the Singapore International Energy Week and the Asia Clean Energy Forum. More broadly, ADB has developed a strategy to proactively disseminate information about the facility and share the achievements and lessons of supported projects to financing partners, other development agencies, and a wider general audience. The 2021 CEFPF workplan specifically notes that dissemination activities for funds across the facility will continue and focus on increasing external promotion of activities outside ADB. E: RISK Overall risk rating: ModerateOverview of programme risk?This programme offers a good fit with the ICF risk appetite for moderate-to-high investment risk, where the expected benefits have strong transformational potential but may not be realised. A summary of the main risks that have been monitored in the 2020 reporting period is shown in the table below with the risk responses that BEIS and ADB have and will continue to undertake.Risk description??Risk response??Residual Risk rating?External: COVID-19: There is a risk that COVID-19 impacts the ability for the ADB to deliver all technical assistance activities due to national and global restrictions, thus impacting the programmes achieved results.Response: ReduceDescription: Since March 2020, ADB staff have been in work-from-home arrangements. Project implementation was adjusted to the travel restrictions brought about by the pandemic through online meetings, forums, and workshops using MS Teams, Zoom, and other platforms, or by postponing some activities until travel restrictions are loosened.In cases where restrictions limit the ability for delivery, ADB project teams closely monitor the projects, coordinate with ADB departments, streamline processes if possible, and for some, request ADB management to extend the project duration to allow technical assistance to be delivered in 2021.MajorDelivery:?There is an inherently higher risk that technical assistance projects will not deliver the desired outputs and outcomes, as a result of challenges faced in countries but also due to difficulties in measuring outcomes that can be directly attributed to technical assistance projects. However, the CEFTA programme also offers a strong transformational potential to shift whole economies / sectors onto low carbon pathways.?Response:?Reduce?Description:? ADB has well-established governance, monitoring and reporting structures. BEIS works with the ADB and other donors to ensure monitoring and reporting remain fit-for-purpose, in particular for evaluating the effectiveness of technical assistance projects.??ModerateExternal:?Political.?As with all technical assistance programmes, there is a risk that there will not be the necessary political will from the host governments. This risk?is?central to the?decision-making?process during project selection, and ADB will continue to monitor it during the development phase of technical assistance projects.?Response:?Reduce?Description:?The process of initiating projects under the CEF reduces this risk as project ideas result from consultation with member countries by ADB. To mitigate further funded activities, include knowledge-sharing events that are also expected to help increase the will of the private sector to consider renewable energy and energy efficiency projects by demonstrating the benefits that they can have. MajorDelivery:?Transformational change.?There is a risk?that an intervention is assessed not to have delivered transformational results.?Response:?Reduce?Description:?This is addressed through developing a portfolio of projects that support technical assistance activities that are genuinely additional and support the development and deployment of renewable energy and energy efficiency technologies. Close monitoring of progress from the UK and other donors of the facility ensures that where projects are not progressing well, problems can be addressed at a relatively early stage, and if necessary, redirect funds in order to ensure that investments are transformational.?MajorExternal:?Duplicating others.?There is a risk that ADB may?not be?able to identify all the other work in this area and duplicates other donor investments.?Response:?Avoid?Description:?BEIS works with ADB to map out what is already taking place in the sectors, including what is being planned and delivered by the Green Climate Fund.?ModerateLegal:?Governance and oversight.?There is a potential risk when investing in a fund managed by a large MDB that there will be an established governance structure and therefore a reduced ability for the UK to influence the direction of the fund.?Response:?Reduce?Description:?BEIS reduces this risk by drawing upon the existing strong working relationship that the ICF team has within the ADB team who deliver the CEFPF. BEIS also has a UK representative on the Board of ADB. BEIS has a good understanding of ADB’s processes and experience of working with the ADB indicates that they action feedback from donors effectively and in a timely manner. BEIS also has established relationships with other CEF donors.?ModerateOverview of risk managementBEIS obtains regular updates from the ADB during quarterly programme meetings, semi-annual donor meetings and semi-annual reports, the information is used to monitor and update risks recorded in the BEIS risk register.Aside from the new risks introduced by COVID-19, the overall programme risk assessment remains largely unchanged from the 2019 extension Business Case. The number of applications received and supported by CEFTA was not affected by COVID-19 as ADB continued its operations amid the pandemic. During the review period, COVID-19 impacted the ability of ADB to deliver in person technical assistance - particularly training, knowledge sharing and learning activities. A number of activities were delivered virtually, however activities from 6 technical assistance projects were delayed or cancelled due to COVID-19, due to a number of national government stakeholders expressing preference for in-person rather than online training. Outstanding actions from risk assessment In addition to managing the short-term impacts of COVID-19, ADB should look in detail at the longer-term impact of the pandemic on the original programme expectations. ADB should ensure that the regional learning and training activities that could not go ahead in 2020 are programmed in to the 2021 work plan and considered in the review of the ADB Design and Monitoring Framework by 31st July 2020. F: PROGRAMME MANAGEMENT: DELIVERY, COMMERCIAL & FINANCIAL PERFORMANCE Assess the VfM based on performance over the past yearThere have been no changes to the specific costs and cost drivers identified in the business case. VfM performance in this reporting period is in line with the VfM proposition in the business case.Equity: The strength of the CEF TA programme is that it covers both low and middle-income countries, from Small Island Developing States (SIDS) to large emerging economies. We work with delivery partners and teams in UK embassies and High Commissions to respond to any unintended equity impacts and capture and act on lessons learned. The impacts of climate change are likely to have a disproportionate impact on women, so mitigating the impacts are likely to be positive for gender equality. The benefits of the programme are not necessarily immediately received by the poorest people or communities in the countries that it supports, but instead are received by government bodies and institutions involved in clean growth transitions, including financial institutions and companies. However, CEFTA’s role in influencing the way that these institutions operate and promoting renewable energy and energy efficiency technologies builds capability and capacity and transforms markets. BEIS funding is aligned with ADB’s policies for gender equality and the ADB Strategy 2030 includes “accelerating progress in gender equality” as one of its seven operational priorities. Gender performance?is?tracked and reported annually by ADB. In the reporting period ADB disaggregated by gender the percentage of participants reporting positive feedback at CEFTA training workshops. Of the 171 participants attending 7 training activities, 29% were women. Of those who reported positive feedback, 28% were women. This was the first year that data on gender was reported at CEFTA workshops and sets a baseline target of gender equity for the remainder of the programme.CEFTA continues to have a diverse geographic coverage, although it continues to have relatively few projects in SIDS. CEFTA has two Pacific specific projects, both of which were approved in 2016. The geographic remit of projects approved in 2020 included regional projects, South East Asia, South Asia and Central Asia.Economy: ADB charges a service fee of: i) 5% of the amount disbursed for grant components of investment projects up to US $5 million, or 2% (with a minimum of US $250,000, whichever is greater) of the amounts disbursed for the same type of grants above US $5 million; or ii) 5% of the amounts disbursed for technical assistance operations. The fees are charged based on actual project disbursements, however, the equivalent amount for the entire project is already set-aside/earmarked as soon as the project is approved by the ADB but will only be drawn from when disbursements are made. At project completion, undisbursed amounts including undisbursed fees are returned to the fund as savings.This is broadly in line, if not cheaper than comparatives – for example, the World Bank charges 5% on the first US $50 million, then 4% above US $50 million. BEIS has worked closely with ADB in the CEFPF for six years since December 2012 when BEIS invested ?35 million in the ADB CCUS Fund (which also comes under the CEFPF), as well as for three years since December 2015 for the CEF specifically. As such, the BEIS ICF team has established excellent working relations with the ADB to drive value-for-money in supported projects and we consider them to be a strong delivery partner and their management fees represent good value-for-money. ADB already has significant experience in using an open and competitive process for selecting delivery agents in the project design process in order to get high quality inputs (e.g., staff and consultants) at a good price. Efficiency: Efficiency refers to how well our inputs are converted into outputs. In terms of the efficiency of the programme, the CEF was set up in 2007, so has been running for twelve years. Since the UK joined the CEF in December 2015, the CEF supported 33 TA projects in 2015, 18 TA projects in 2016, 7 TA projects in 2017, 4 TA projects in 2018, 2 in 2019, and 6 2020. The number of projects each year depends on the number of proposals received in that year (and which pass the proposal review stage), which varies from year-to-year and the amount of funding left in the CEF. Effectiveness: Effectiveness refers to how well the outputs (that are under the direct control of the delivery partner) achieve the outcomes (over which there is less control). The programme aims to test whether by supporting a technical assistance project that addresses a lack of knowledge or regulatory reform, it can deliver transformational change by supporting regional and national economies and sector-wide changes that deliver results far more efficiently than through funding a series of individual capital projects. Because this is the fifth year of delivery it is possible to make an assessment regarding progress to meeting outcomes and transformational change. This year, CEFTA scored a 3 for KPI15 (tentative evidence of change – transformational Change judged likely), this is based on the number of rubric indicators which are deemed true, in 2019 this was 5/10 and in 2020 the number increased to 8/10. This is a positive sign of progress towards meeting BEIS aims of achieving transformational change by developing and implementing technical assistance projects that lead to an improved investment climate in supported countries. Summarise the performance of partners and BEIS, notably on commercial and financial issues.The 2019 extension business case extends the CEFTA Memorandum of Understanding (MoU) that BEIS has with ADB until the 31st December 2021 with the expectation that BEIS funds would be disbursed by December 2020. Project implementation is expected to occur beyond December 2021 due to the duration of several projects. BEIS funds are mixed with the investments from four other donors and therefore the financial audits of the fund do not show BEIS specific disbursements. However, ADB has disbursed $7.2m (c.?5.2m) to TA projects within the CEF since 2019 (when BEIS committed ?9.5m) which has contributed to the CEFTA log frame reporting. $27.5m of funding remains available within CEF and a pipeline of technical assistance projects valued at $18.8m has been submitted to ADB. In addition, the ADB Design and Monitoring Framework, which defines CEF objectives and targets, culminates in 2021 and is expected to be reviewed. BEIS and ADB should agree a plan for how TA projects will be monitored and reported after 2021. The future direction of CEF will be determined based on the discussions and agreement with the financing partners at the Annual Consultation Meeting held in 2021. Annex A – projects that were allocated resource in 2020CEF-TA projectCountryADB Approval DateCEF allocationUZB: Promoting Distributed Solar Photovoltaic Power for Enhanced Access to Energy in Uzbekistan?UzbekistanDec-20$100,000REG: Regional Support to Build Disease Resilient and Energy Efficient Centralized Air Conditioning SystemsRegionalSep-20$500,000SRI: Rooftop Solar Power Generation Project (Additional Financing)Sri LankaJul-20$250,000INO: Implementation Support for Geothermal Power Generation ProjectIndonesiaJul-20$650,000CAM: Preparation of a Sector Development Program to Catalyze Energy Efficiency in CambodiaCambodiaFor ADB approval$750,000REG: Marine Aquaculture, Renewable Energy, Reefs, and Ecotourism for Ecosystem ServicesRegionalDec-20$1000,000B – projects supported as a direct or indirect result of CEF TACEF-TA projectEnsuing capital projectADB(in $ millions)Non-private sector(in $ millions)Private sector (in $ millions)Indonesia: Geothermal Power Generation ProjectIndonesia: Geothermal Power Generation Project300169.2China: Preparing Air Quality Improvement Program in the Greater Beijing-Tianjin-Hebei RegionChina: Air Quality Improvement in the Greater Beijing–Tianjin–Hebei Region—Green Financing Scale up Project150China: Proposed Low Carbon City Transformation Program in Xiangtan, HunanChina: Xiangtan Low-Carbon Transformation Sector Development Program83.87195.88China: Strengthening Capacity in the Implementation of the Green Financing Platform for the Greater Beijing–Tianjin–Hebei RegionChina (3 sub-projects): (i) Air Quality Improvement in the Greater Beijing Tianjin Hebei Region, (ii) China National Investment and (iii) Guaranty Corporation's Green Financing Platform Project7.311.83?Subtotal533.87372.3811.83 ................
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