Bennett ES260, Draft 1

Chris Bennett

Earth Systems Internship Paper, First Draft

“Low-Carbon Development: The Millennium Challenge Corporation as a

Case Study”

Table of Contents
Table of Contents.................................................................. 1
Section 1: Introduction and Context.......................................2
Section 2: Research Questions and Methods...........................3
Section 3: Results.................................................................3
Climate and Development: The Growing Consensus........................................3
Existing Best Practice ......................................................................................5
Mitigation Best Practice ...............................................................................5
Adaptation Best Practice..............................................................................6
Improving MCC’s Environmental Practices.......................................................7
Section 4: Conclusions .......................................................... 8
Section 5: Appendices...........................................................9
APPENDIX I: Mitigation Best Practice in Detail..................................................9
Appendix II: Adaptation Best Practice in Detail..............................................11
APPENDIX III: Matrix of Best Practices at Multilateral and US Development
Banks (First Intern Research Product)...........................................................14
Appendix IV: Screening and Decision Tools for Adaptation and Mitigation
(Second Intern Research Project) ..................................................................16
Works Cited........................................................................17

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Section 1: Introduction and Context

Climate Change has been described as the “world’s greatest market
failure,” by Nicholas Stern, as inaction would retard long-term growth
in the range of 20% of GDP per annum. Moreover, the “impacts of
climate change will fall disproportionately upon developing countries,”
those who need this growth most (Intergovernmental Panel on Climate
Change). Why then, are development organizations that claim to invest
in their future often commiting the same error? This paper explores the
history, current state, and future prospects of low-carbon development
within the organizational context of the Millennium Challenge
Corporation (MCC).

The Millennium Challenge Account was established in 2004, and in the

same year the MCC was created as an independent government
corporation in order to execute the fund. In “Governance and Foreign
Assistance: the Imperfect Translation of Ideas into Outcomes,” Desha
Girod, Stephen Krasner, and Kathryn Stoner-Weiss discuss how the
MCC came about due to a growing concern in the wake of 9/11 that the
US government ought to establish an organization that could
effectively respond to the needs and demands of the developing world.
The design of the new MCC program aimed to do so by departing from
the traditional flaws of development assistance and instead delivering
funds based on “institutional and policy performance” (Girod, Krasner
and Stoner-Weiss). Funds have been disbursed through countries since
then using an array of 17 selection indicators, most which have a high
correlation with growth. By the beginning of 2008, the MCC had signed
compacts with 16 countries totalling more than $5.6 billion dollars.
MCC’s mission is to reduce global poverty through sustainable
economic growth, and so it’s no surprise that environment plays an
important role in the process. MCC has had guidelines to ensure all
project work is socially and environmentally sound since its inception,
and one of the 17 indicators assesses management of natural
resources. Recognition that climate change will seriously impact
development investments has been more slow to come, as will be
discussed in the results section.

I interned at the MCC from January 2009 until the end of March 2009,
and during my time there completed an extensive research review on
best practice for low-carbon development (more precisely, for
mitigation and adaptation in developing countries). This research
helped me to craft several smaller research products, and eventually
to contribute to a memo which aimed to help spur the adoption of

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more progressive internal environmental policies. The point of this

paper is two-fold: first, to codify and organize the results of this
research, and second, to broaden their application to the prospects for
low-carbon development by treating the Millennium Challenge
Corporation as a case study.

Section 2: Research Questions and Methods

The research questions posed in this paper are three-fold. First, what is
the extent of climate awareness in the development sector? This
question is important to gauge the degree to which scientific and
economic recognition of the effects of climate change has influenced
existing institutions. Second, what best practices exist now, and are
they environmentally and developmentally sound? Finally, given the
answer to these first two questions, what must be improved from this
baseline or adopted from best practice to deliver sustainable economic
gains in light of climate complications? This final question is the
fundamental one, and will be answered partially in results and partially
in conclusion. In the results section, I will compare best practice to
internal MCC policies, recommending specific actions the organization
could take to improve its pursuit of low-carbon development. In the
conclusion section, I will answer this question again on a more broad
level by reflecting on the results.

The research methods I’ve used are two-fold. The first is a literature
review; my internship involved compiling the existing knowledge and
policies of donors giving development aid. This method is the
foundation for all the policies, examples, and recommendations listed.
The second method is that of a case-study, in which I’ve treated the
process of the Millennium Challenge Corporation’s internal climate
reform as another point of analysis. I’ve employed this perspective to
draw more general conclusions.

Section 3: Results
Climate and Development: The Growing Consensus
Practitioners, politicians, and academics in development traditionally
considered environmental concerns to be a luxury relative to the
importance of growth. Often, greener practices were viewed as
“levying a tax on those least able to afford it” (McKee). This
prioritization was based on the assumption that environmental and
economic outcomes are largely separable. The implications of the
Intergovernmental Panel on Climate Change’s 4th report and the Stern
Review on the Economics of Climate Change, however, made it clear
that this notion was untenable. The idea that developmental priorities
are opposed to climactic ones ultimately ignored the fact that low-

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carbon trajectories for development would be the ones that would work
in the coming years (Baer and Athanasiou).

The notion that the adverse effects of climate on the developing world
could erase the expected gains of development organizations provided
a more tangible foundation for the argument, and consensus on the
issue gained institutional traction within the World Bank following the
meeting of the parties in Bali in December 2007. Consensus was
articulated in the World Bank’s Strategic Framework for Climate
Change document, released in early 2008: “climate change has the
potential to reverse the hard-earned development gains of the past
decades and the progress toward achieving the Millennium
Development Goals (MDGs)” (The World Bank). The fact that the World
Bank’s 2009 World Development Report is focused entirely on
Development and Climate Change demonstrates this sea change in
perception. The report explicitly states that climate change must
become one of the bank’s fundamental strategies in the 21st century,
as a “multilateral institution whose mission is inclusive and sustainable
development” (The World Bank).

By mid-2008, MCC similarly realized that global climate change would

have significant impact on its core mission of providing sustainable
economic growth. Poor countries and communities, in addition to the
basic needs of providing for their populations, will be faced with the
challenge of preparing for, and responding to, increased volatility in
weather patterns, rising sea levels, and other climatic impacts.
Likewise, MCC admitted that the impacts associated with climate
change could work to undermine much of the development success a
country has experienced and have implications for the overall
investment of MCC resources. In early 2008, MCC released press
statements and fact sheets agreeing that climate change was both an
“environmental and developmental issue” and emphasizing the six
compacts so far that include project components aiming to improve
the global carbon balance (Millennium Challenge Corporation).
However, these sporadic actions have not been met by a comparable
change in development practice or policy.

In “Correcting the World’s Greatest Market Failure: Climate Change

and the Multilateral Development Banks”, Smita Nakhooda emphasizes
the difference between rhetoric and action. Although the Bali Action
Plan in 2007 called for Multilateral Development Banks to play a strong
role in helping to promote low-carbon growth, change has been non-
existent since then. Although development organizations ‘get it’ at a
conceptual level, she argues that opportunities to mitigate emissions
and reduce climate risk still had not been “systematically incorporated
into MDB strategies and project development” (Nakhooda). Figure 1

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demonstrates that through 2006, the vast majority of development

investment did not consider climate impacts at all. Clearly, although
change is now afoot, it is slow to come. The next section details the
current state of play.

Existing Best Practice

Mitigation Best Practice
As mitigation refers to “implementing policies to reduce GHG
emissions and enhance sinks,” it includes a wide variety of options.
There is no silver bullet to mitigate emissions; instead, there is a broad
menu of different policy opportunities (Intergovernmental Panel on
Climate Change). These broadly fall into four categories: increasing
energy efficiency, fuel switching, renewable energy, and forestry and
agricultural issues. Donor best practice cuts across all four of these
sectors and both basic strategies of mitigation, but simplifies into the
following three paths:

First, donors have made an effort to reduce their own GHG

emissions by following a low-carbon trajectory in their project
activities. The donor will assess the amount of emissions currently
associated with project activities, and then mandate, offset or fund
a shift towards a less carbon intensive path. So far, only the
European Bank on Reconstruction and Development (EBRD), the
United State’s Overseas Private Investment Corporation (OPIC), and
the International Finance Corporation have designed guidance to
track the total contribution of all carbon-intensive projects and
implemented portfolio assessment. Best practice in subsequent
mitigation includes the World Bank Group’s (WBG’s) Climate
Investment Fund, which transfers technology and finance to offset
emissions, and an explicit ban on carbon-intensive (coal) projects by

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a few donors (see Appendix IV). A shadow price on carbon would

drive substantial mitigation, but remains unimplemented at any
major donor (The World Bank).

Second, donors have additionally reduced GHG emissions by

emphasizing fuel switching, renewable energy, and energy
efficiency project alternatives through either donor-designed
initiatives or through carbon finance with private partners. An
example of the first is the World Bank Group’s pledge to increase
renewable energy by 20% per year by channeling finance from the
Global Environmental Fund and Climate Investment Fund. The
second option is widespread at all Multilateral Development Banks
(MDBs) through both official (Clean Development Mechanism) and
voluntary market channels.
Third, donors have engaged in a variety of policy options to
enhance sinks through the agricultural and forestry sectors. These
options include developing guidance to increase carbon
sequestration in agricultural and forestry projects and pursuing
carbon finance that enhances sinks. Land Use, Land Use-Change,
and Forestry (LULUCF) project guidance, such as that of the World
Resource Institute or BioCarbon Fund, is well established. Donors
such as the WBG, Asian Development Bank, (ADB), and Inter-
American Development Bank (IADB) pursue credits through CDM
approved sources such as biosequestration, A/F, soil carbon and
agroforestry. REDD project carbon finance is less prevalent because
it is not CDM approved, yet the WBG’s Forest Carbon Partnership
Facility has mobilized over $300 million in readiness funds in
anticipation of these projects.

This serves as an executive summary- for more detail, see Appendices

I and III.

Adaptation Best Practice

As adaptation refers to all those responses to climate change that may
be used to reduce vulnerabilities, donors have taken a large variety of
actions to protect the value of their development investments (United
Nations Environment Program). These actions run down three paths:
developing guidance in adaptation frameworks and sectors, mobilizing
funds for adaptation, and use of adaptation screening and decision
tools.

First, adaptation guidance is widespread. Frameworks provide the

‘big picture’ for addressing adaptation and development. The most
significant frameworks are UNDP-GEF Adaptation Policy, USAID’s
manual “Adapting to Climate Variability and Change,” and IISD’s
“Livelihoods and Climate Change”. Sector guidance also exists for

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vulnerable sectors such as agriculture and irrigation, water, forests

and land use, and roads. A variety of donors and other institutions
have contributed to best practice including USAID, UNEP, FAO, ADB,
WWF, and the WBG; please see Appendix II for more detail.

Second, mobilizing financial resources in advance of climate

change’s impact is best practice at many donors. The ADB has
channeled GEF funds to countries through national adaptation plans
and developed its own Climate Change Fund (Asian Development
Bank). The World Bank Group in July 2008 prioritized “climate
proofing” all of its investments. It now channels funds towards
adaptation through the Clean Energy for Development Investment
Framework, Global Adaptation Fund, and Climate Investment Funds
(The World Bank).
Third, adaptation decision tools, platforms, and databases are a
key part of developing adaptation best practice. These tools provide
the scientific information, climate models, and guidance necessary
to help with project or country specific planning. Highlights include:
CRiSTAL, which is livelihood and community vulnerability based
decision tool; PRECIS and SDSM, platforms that provide global
climate model data for planning; Mapping Climate, which identifies
vulnerability hotspots in sub-Saharan Africa; and NAPA, which is a
database of adaptation project profiles. Please see Appendix IV for
additional tools, descriptions, and links.

This serves as an executive summary- for more detail, see Appendices

II and III.

Improving MCC’s Environmental Practices

MCC could implement examples of the above best practice as long as it
were legally and organizationally feasible, and allowed for compact
relevant approaches. Examples of the above that seem especially well
suited to MCC include:

• Participation or partnership in the Climate Investment Fund,

GEF, or other bilateral funding sources in order to offset GHG
emissions by directly funding low-carbon development
• Assessing feasible fuel-switching (such as hydropower),
energy efficiency, and renewable energy (such as wind)
alternatives in compacts, and including them in project design
or opportunities for finance as appropriate
• Adoption of current LULUCF best practice for project
accounting, and development of procedure and funding for
upcoming biosequestration and REDD carbon finance
opportunities

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• Reviewing and integrating sector-specific adaptation

guidance, specifically in project types that MCC specializes in
such as agriculture, forestry, agro-forestry, irrigation, and
roads
• Participating in a large scale adaptation fund or partnership
such as CIF
• Adopting relevant adaptation decision tools and platforms

In the medium to long term, the MCC should codify its own sourcebook
for adaptation to climate risks as it learns from its experiences with
available adaptation frameworks and sector guidance. MCC may wish
to revise guidelines and compacts to reflect country and project
specific strategies that will integrate vulnerability to climate risks.
National strategies have served a key link in scaling adaptation to the
level of country-specific guidance, and MCC should work with partner
countries to help them develop and implement their own national
adaptation policies and strategies. Funding could take place
independently, but MCC could also consider meeting additional costs
through GEF, CIF, or other funds.

Section 4: Conclusions
The Millennium Challenge Corporation has a unique position; it is not a
typical aid donor, and has a reputation for innovation. Moreover, as a
government corporation that operates in partial insulation from
partisan demands, it has an opportunity to take a relatively bold
environmental stance on the interconnectedness of climate and
development. In this conclusion section, I want to pose the broader
question of why this has not happened, as well as suggest some future
directions.

As demonstrated in the introduction and first section of results, there is

a large amount of climate awareness within the development
community; scientific knowledge isn’t the barrier to reform. The second
section of results shows that a great deal of best practice already
exists within the larger community, yet very little of this has been
adopted by the MCC. Thus, the inability of best practice to spread or
diffuse in the field that seems to be the key barrier that has prevented
the institutionalization of low-carbon development.

A partial explanation for this is the degree to which the MCC, as a

government corporation, might still be constrained relative to more
independent and international multilateral institutions such as the
World Bank Group or the Asian Development Bank. U.S. government
agencies are acutely aware that their approach to climate change must
be consistent with other U.S. policy as well as the commitments of the
U.S. government with respect to the United Nations Framework

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Convention on Climate Change (UNFCCC) as well as other international

treaties, agreements and obligations, to which the United States is
signatory. Further, its position and actions with respect to climate
change must be consistent with and supportive of the broader position
taken by the U.S. Government with respect to the Bali Action Plan,
adopted at the Conference of Parties (COP) in December 2007, and the
ongoing negotiations under Conference of the Parties to the UNFCCC.

There isn’t an easy way to get around the glacial pace of government,
but there is hope that change in government priorities will trickle
down. The Obama administration has indicated that action on climate
is a priority, yet significant government positioning on the international
aspects of climate will only become evident after the dust from
Copenhagen has settled. Moreover, change in international financial
mechanisms for climate can only help. Cameron Hepburn suggests
that the Clean Development Mechanism has always been a relatively
controversial mechanism; in addition to the disputed validity of its
emissions reductions, transaction costs are very high (Hepburn).
Because of this hassle and cost, organizations like MCC have had a
disincentive to participate. The incentive for it to be significantly
reformed and redesigned is strong, and assuming this happens, donor
agencies will be far more likely to adopt it as a financial instrument.

However, this is very optimistic. Adequately responding to this sort of

challenge might require innovative partnerships with relevant
organizations. Development organizations such as the MCC might be
thinking too small by merely reacting to increasing climate awareness
within their existing spheres of jurisdiction. In High Noon: Twenty
Global Issues and Twenty Years to Solve Them, J.F. Rischard argues
that traditional organizations are becoming obsolete in the context of
massively complex global issues, of which both climate change and
economic development are prime examples. Instead, networked
governance is a more attractive option, as it minimizes complexity and
hierarchy and minimizes the time required for results by bringing
together coalitions of multilateral or government institutions with
private sector and civil society actors with expertise (Rischard). For
example, the MCC might work with hybrid coalitions of non-
governmental organizations, private sector carbon clients, and local
communities to better streamline project-neutrality, rather than
defining rigid top-down policies.

Section 5: Appendices
APPENDIX I: Mitigation Best Practice in Detail
I. Best practice for a low carbon trajectory
i. Greenhouse Gas (GHG) Accounting

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1. This involves tracking and assessing the total

impact of project activities (as opposed to
operational foot printing) on GHG emissions with
the goal of moving to a low-carbon trajectory;
best practice at the European Bank for
Reconstruction and Development (EBRD), the US
Overseas Private Investment Corporation (OPIC),
the Export-Import Bank, and the International
Finance Corporation (IFC).
2. Guidance is available, notably EBRD’s Assessment
Methodology, and the GHG Protocol for Project
Accounting. This guidance is largely for industrial
energy projects
3. Besides creating a baseline to channel finance
and improve design, it is not clear these actions
have resulted in actual mitigation; this policy
option is still at a learning stage
ii. Funding the incremental costs of low carbon
development
1. The best example is the World Bank Group’s
(WBG) Climate Investment Fund, a successor to
the Global Environmental Fund that provides
finance for technology transfer and reform for
donor countries; Partners include ADB, the African
Development Bank (AfDB), EBRD, Inter-American
Development Bank (ADB), and private sector
actors.
iii. Reducing GHG Intensive Projects and Sectors
1. A shadow price on carbon would catalyze a strong
shift towards renewable and efficient energy;
however, due to conflicts with development
priorities, this is not implemented at any large
institution
2. An explicit ban on heavily fossil-fuel based
projects, such as coal, has been implemented by
the following donors: the WBG via the Clean
Technology Fund, OPIC, and ADB
II. Best Practice for Agricultural and Forestry Sectors
i. Extensive project guidance exists, notably the World
Resources Institute and World Council for Sustainable
Business Development’s Land Use, Land Use-Change,
and Forestry (LULUCF) accounting guide and the WBG’s
BioCarbon Fund LULUCF Sourcebook.
ii. Pursuing carbon finance opportunities in
biosequestration, including afforestation/reforestation,
agroforestry, and soil carbon

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1. Credits for these are available through the Clean

Development Mechanisms (CDM) as well as
voluntary markets; carbon finance opportunities
are obtained as best practice by many Multilateral
Development Banks such as WBG, IADB, EBRD,
and the AfDB.
iii. Pursuing carbon finance in Reduced Emissions from
Deforestation and Degradation (REDD)
1. Because REDD is not formally included in CDM, it
is only accessible through a few markets (CCX,
Plan Vivo, CCBS, WBG Carbon Finance Unit) and
thus used by few donors
2. Post-2012 negotiations will likely extend official
CDM coverage to credits for soil carbon, green
biofuels, and agroforestry; The World Bank’s
Forest Carbon Partnership Facility is currently
providing $300 million in ‘readiness funds’ for this
purpose.
III. Best Practice for Infrastructure and Energy Sectors
i. Initiatives to increase emphasis on low-carbon energy
projects
1. The World Bank Group has pledged to increase its
investment in Renewable Projects by 20% each
year over the next five years
2. Several MDBs, such as ADB, EBRD, IDB, fund
significant amounts of RE as “executing agencies”
in cooperation with the Global Environmental
Fund (GEF)
ii. Energy Efficiency and Renewable Energy projects
generate carbon finance flows in official and voluntary
markets at several MDBs
1. Through the WBG’s Prototype Carbon Fund and
the ADB’s Carbon Market fund, MDB’s are helping
to scale up market formation and reduce risk

Appendix II: Adaptation Best Practice in Detail

II. Adaptation Frameworks
i. The “United Nations Development Program (UNDP)-GEF
Adaptation Policy Framework” focuses on developing
National Adaptation Plans that integrate climate risk
and assess vulnerabilities, reduce risk, and climate-
proof projects
ii. UNEP-published “Handbook on Methods for Climate
Change Impact Assessment and Adaptation Strategies”
discusses methods of risk assessment such as decision
matrix, benefit-cost analysis, cost-effectiveness

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Bennett ES260, Draft 1

analysis, implementation analysis

iii. The United State’s Association for International
Development’s (USAID) manual “Adapting to Climate
Variability and Change” focuses on identifying
sensitivities and building resilience in project design and
implementation
iv. The UN Food and Agriculture Program (FAO) focuses on
legal and institutional capacities such as legislation,
legal tools, regulatory tools, and governance; policy and
planning elements such as risk assessment, and
strategy formulation; and livelihood issues like food
security and poverty
v. IUCN, SEI, IISD, and Inter-cooperation produced
“Livelihoods and Climate Change”, a framework which
emphasizes ‘bottom-up’ adaptation working on
livelihood vulnerabilities. The process involves climate
vulnerability and livelihood interactions and then
developing respective adaptation measures and
strategies
II. Adaptation by MCC-relevant Sectors
i. Agriculture and Irrigation
1. WBG has engaged in public sector actions such as
crop and livestock insurance, safety nets,
research on drought, heat resistant crops, and
reforms for better market access. It is working on
climate data and agro-meteorological programs
that will help adaptation through changing
irrigation schemes and agricultural planning
2. The FAO has worked on increasing and preserving
agro-biodiversity through the GIPB initiative;
improving soil and land management, specifically
low till farming practices through Global Land
Cover Network in cooperation with UNEP; and
worked on crop yield forecasting models
3. UNEP has developed adaptation tools such as
agro-climatic indices, statistical crop models,
analogues, and assessment of village, regional,
and national effects. It provides guidance on local
adaptation choices such as crop choice change,
altered tillage and husbandry; and altered inputs
(irrigation, fertilizers, and chemicals)
4. ADB emphasizes irrigation adaptation via water
management programs, drought resistant crops,
improving irrigation efficiency, and watershed
protection
ii. Water Resources

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1. The World Wildlife Fund emphasizes water

infrastructure management, flood management,
and climate-aware development planning;
development project design must account for
changing water availability
2. UNEP guidance describes biophysical impacts-
hydrologic, water quality, aquatic ecosystems; as
well as socio-economic, such as water demand
and management linked to CC; provides modeling
and project assessment methods
iii. Forests and Land Use
1. UNEP guidance explores bioclimatic models
estimating forest shifts, details planned
adaptation such as changing species harvested or
planted, shifting land use, shifting industry and
forest use, and emphasizes shifts between forests
and agriculture with land use change
iv. Roads
1. USAID provides guidance on designing for severe
floods and storms that can wipe away roads or
other infrastructure, details flood protection
projects
III. Adaptation Funding and Initiatives
i. ADB crafts National Action Plans for Adaptation, using
GEF administered funds; through the Climate Change
Fund, projects are screened for climate resilience
against gradual change, and climate-proofed for severe
climate events
ii. World Bank Group
1. In their 2008 Strategic Framework for Climate
Change and Development, the WBG prioritizes
“climate proofing” all future development
investments. This is based off lessons learned
from the Clean Energy for Development
Investment Framework (The World Bank).
2. Administers the Global Adaptation Fund, financed
by a 2% fee on all CDM transactions, the Global
Facility for Disaster Reduction and Recovery for
climate disasters, and the Climate Investment
Funds, many which are used for adaptation
IV. Adaptation Decision Tools, Databases and Platforms
i. See Appendix III

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APPENDIX III: Matrix of Best Practices at Multilateral

and US Development Banks (First Intern Research
Product)
GHG Project Shadow Mitigation Adaptation Assessment Coal Guidance
Foot- Price on Approaches Approaches Process Notes
printing Carbon
(SPC)

Yes. OPIC No, but Energy and Not published Assess every No Must reduce
will report projects are operational project; all GHG
OPIC GHG evaluated efficiency, those in emission in
emissions and co- forestation, industrial portfolio by
for all financed so and recovery sectors or 20% over 10
current and as to and storage of sensitive years
new >100 emphasize GHG must
kt CO2 clean undergo EIA
emitting energy under US or
projects1 WBG
standard2

USAID No No Clean energy, Famine Early All projects No Adapting to

tech transfer; Warning are assessed Climate
Reducing Systems according Variability
Deforestation, Network; the Guidance and Change
Congo Basin extensive Manual
Forest guidance
projects

Ex-Im Yes. No. Ex-Im Environmental Not published All projects > Yes, Not
Projects still finances Exports 10 million if published
>50 carbon Program undergo 98%
kilotons will intensive provides environment S02
be tracked, projects finance for al screening; remo
and carbon thermal EIA and WBG val
accounted power4 categorizatio
for in n
Annual
Report3

World No. In 2007, No; conflict GEF several Funds under Safeguard Yes Under
Bank almost 50% of interest billion $ GEF; GFDRR, Policies6 Operational
Group of lending with market Climate Directive 4.01
was made developmen development; Change must minimize
without any t, but manage 11 Initiative global
consideratio exploring it carbon funds. Grant, LCDF, environmental
n of climate for future Increase SFCCD5 impact7
change sue efficiency and
renewable
lending
20%/yr.

1
OPIC Greenhouse Gas/Clean Energy Initiative, June 14 2007
2
OPIC Handbook, p. 7
3
Ex-Im, Environmental Procedures and Guidelines
4
Ex-Im, Environmental Procedures and Guidelines, Annex F
5
Toward a Strategic Framework on Climate Change and Development for the World Bank Group, p. 19
6
World Bank Operational Policy (OP) Bank Procedure (BP) 4.01: Environmental Assessment
7
Chapter 2, Global and Cross Sectoral Issues in Environmental Assessment, p. 3

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 Bennett ES260, Draft 1

IFC Yes, > 100 No, but Sustainable Access to GEF Performance Yes Must
kt CO2 actively Infrastructure Adaptation Standards on evaluate
requires looking into Plan and Fund, Social and GHG
assessment adopting it partnership specializing in Environment emissions
, and with GEF/WBG energy and al under Kyoto;
documente carbon tech transfer9 Sustainabilit must reduce
d yearly8 finance y10 or offset11

EBRD Yes. Screen No; yet Sustainable Not published High risk Yes; Client must
all projects, many new Energy requires w. promote
any above projects Initiative. Env’t assess biom reduction of
20 kt Co2/yr include Total costs of (Referral, ass GHG
requires white/green €5 billion Category A)13 emissions;
mitigation12 certificates, Carbon Credit to reduce C
new finance Fund to intensity14
mechanisms administer
new EU
carbon
finance

ADB Informally; No. Yet the Clean Energy Climate ADB No, In the mid-
through EEI, Carbon Partnership, Change Fund Environment after term,
projects are market $90m, Carbon (CCF): $40 al EEI managing
assessed, initiative Market million, Assessment the
monitored provides Initiative/Futur Disaster Guidelines; environment
and then upfront e Carbon Emergency assigned one is one of the
offset15 financing, Fund, Energy Funds, of 4 project bank’s 5
emphasizing Efficiency climate categories strategic
RE projects Initiative proofing for priorities
1bn/y monitoring

IADB Yes. In 2005 No. But via Fund clean Adaptation Environment Yes Sustainable
surveyed SECCI, clean energy/technolo branch of and Energy and
GHG from energy gy up to $1.5 SECCI focuses Safeguards Climate
private alternatives Billion/yr16, on national Compliance Change
sector prioritized especially programs Policy Initiative
portfolio, biofuels, (SECCI) is a
now support Carbon core bank-
formalizing Finance wide initiative
process process17

EIB No: but N, but Ambitious Emphasis on EIB Yes, Integration of

Foot- assessed for renewable adaptive land Environment clean energy in
printing for clean energy target, use change Assessment coal Corporate
current energy up to 12 CCS Policy; Operational
projects is financing in power plants projects Policy; 20%
underway RE project planned18 categorized reduction by

8
http://www.ifc.org/ifcext/sustainability.nsf/AttachmentsByTitle/p_2005SustReport_GHG/
$FILE/GHG_Inventory_Final.pdf
9
Toward a Strategic Framework on Climate Change and Development for the World Bank Group, p. 25
10
http://www.ifc.org/ifcext/sustainability.nsf/Content/EnvSocStandards
11
IFC Guidance Notes 2007, p. 70
12
ERBD Greenhouse Gas Assessment Methodology, February 2005, p. 2
13
ERDB, Environmental Risk Categorization List 2008, p. 1
14
EBRD, Environment and Social Policy, p. 29
15
Energy Efficiency Initiative Brief, ADB
16
The Multilateral Banks and the Climate Change Agenda, p. 11
17
http://www.iadb.org/secci/projects.cfm?lang=en

15
 Bennett ES260, Draft 1

documents Manage 3 and 2020

carbon funds managed

AfDB No; a No; trust Climate Support 5-10 Environment Yes Clean Energy
working funds in Investment adaptations/yr al Safeguard Investment
group is developmen Facility; Clean by 2010 via Policy using Framework for
attempting t for Energy CIF for climate ESIA tools Africa, directs
to formalize financing Financing proofing; focus
process low-carbon Partnership CECAFA fund
alternatives Facility for RE in
development19

Appendix IV: Screening and Decision Tools for

Adaptation and Mitigation (Second Intern
Research Project)

Tool Type Author(s) Availability Description Scale Link

CVAT Carbon WRI Yes Shadow price in Project Click

Finance energy related
Decision finance

MCC Carbon MCC Developme Identify carbon Project N/A

Carbon Finance nt finance
Offset Decision opportunities

CRiSTAL Adaptation IUCN, IISD, Yes Community and Local, Click

Decision SEI-US livelihood Regional
adaptation

ADAPT Adaptation World Bank Developme Identify and Local, N/A

Decision nt rank project Regional
sensitivities

PRECIS Adaptation UK Met No, must Regional Regional Click

Platform Office purchase assessments
via GCM

Mapping Adaptation ILRI, TERI, Yes Vulnerability Regional Click

Climate Database ACTS, CIAT hotspots in
Sub-Saharan
Africa

SDSM Adaptation Environment Yes Climate risk Regional Click

Platform Agency, UK information
through 2100

18
The Multilateral Banks and the Climate Change Agenda, p. 12
19
The Multilateral Banks and the Climate Change Agenda, p. 36

16
Bennett ES260, Draft 1

CAIT Adaptation WRI Yes Country Level National Click

Database Climate
Vulnerabilities

CIEAR Adaptation SEI Developme Resource Multiple N/A

Platform nt management,
climate risk

NAPA Adaptation UNITAR Yes Global Multiple Click

Database adaptation
project profiles

ORCHID Adaptation IDS Yes Country-level National Click

Database disaster
reduction

SERVIR Adaptation USAID, Yes Climate and Local, Click

Platform NASA disaster map Regional
for Latin-Am

Works Cited
Asian Development Bank. Strengthening Mitigation and Adaptation in
Asia and the Pacific. Brief. Washington, DC: Asian Development Bank,
2008.

Baer, Paul and Tom Athanasiou. The Greenhouse Development Rights

Framework. Berlin: Heinrich Boll Foundation, 2008.

Girod, Desha, Stephen Krasner and Kathryn Stoner-Weiss. "Governance

and Foreign Assistance: The Imperfect Translation of Ideas Into
Outcomes." 2009.

Hepburn, Cameron. "Carbon Trading: A Review of the Kyoto

Mechanisms." Annual Review of Environment and Resources 32 (2007):
375-93.
Intergovernmental Panel on Climate Change. Annex 1 Glossary. 2009.
29 January 2009 <http://www.ipcc.ch/pdf/glossary/ar4-wg3.pdf>.

McKee, Katharine. Microfinance: Climate Change Connections. Special

Report. The World Bank. Washington, DC: The World Bank, 2008.

Millennium Challenge Corporation. Global Climate Change: Press

Release. 22 April 2008. 10 February 2009
<http://www.mcc.gov/mcc/press/releases/global-climate-
change.shtml>.

Planning Commission. The Working of State Electricity Boards &

Electricity Departments. Government of India. New Delhi: Government
of India, 2002.

17
Bennett ES260, Draft 1

Rischard, J.F. High Noon: Twenty Global Problems, Twenty Years to

Solve Them. New York: Perseus Books, 2002.

Smita, Nakhooda. Correcting the World's Greatest Market Failure:

Climate Change and the Multilateral Development Banks. Issues Brief.
Washington, DC: World Resources Institute, 2008.

Stern, Nicholas. Stern Review Report on the Economics of Climate

Change. Commissioned Report. London: Cambridge University Press,
2006.

The World Bank. Towards a Strategic Framework on Climate Change

and Development for the World Bank Group. Consultation Draft. The
World Bank. Washington, DC: The World Bank, 2008.

—. World Development Report 2010: Development and Climate

Change. Press Edition. Washington, DC: The World Bank, 2009.

United Nations Environment Program. "Handbook on Methods for

Climate Change Impact Assessment and Adaptation Strategies." 2007.

18