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1.3.3 

Project Preparation and Development Facility (PDF)

Considering the extensive development work that is required to produce either a full or a medium-sized project proposal, project proponents can request a preparatory grant from the PDF. PDF grants can be used to assess possible project sites, identify threats, root causes or key barriers, identify specific activities ("GEF interventions") to address these factors, evaluate institutional frameworks, meet and consult stakeholders, and identify co-funding opportunities. The operational focal point must endorse PDF proposals. There are three categories of PDF grants; the two most common for a biodiversity conservation project are "Block A" and "Block B."



 

Block A

Block A grants provide up to US$25,000 at the earliest stages of project development. Development and approval of a Block A typically takes 4-6 months from the time a project concept is submitted to an IA along with a letter certifying operational focal point endorsement of the project. PDF A funds are used to support development of the project concept either into a Block B application, or into a full or medium-sized project brief.



 

Block B

Block B grants provide up to US$350,000 for the development of full-size project briefs and project documents. Recently the GEF increased this amount up to US$700,000 for PDF B grants that involve the design of multi-country projects. Development and approval time for a Block B typically takes up to 24 months, and since preparation of a Block B proposal requires a substantial effort, they are sometimes preceded by assistance from a smaller PDF Block A grant. MSPs are not eligible for PDF Block B grants, though they are eligible for Block A grants.



 

Block C

Block C grants (up to US$1 million) provide additional financing, where required, for larger projects to complete technical design and feasibility work. Block C grants are normally made available after a project proposal is approved by the GEF Council.



1.3.4 

Enabling Activity Grants

Grants for enabling activities - up to US$450,000 - help countries to prepare national inventories, strategies, policy analysis and action plans in cooperation with the Convention on Biological Diversity (CBD). GEF's biodiversity enabling activities have focused on assisting countries to prepare their National Biodiversity Strategies and Action Plans (NBSAPs) and/or their first national reports to the CBD Recently the upper limit for these grants was raised from US$350,000 to US$450,000, so that governments can assess their biodiversity-related capacity-building needs and define country-specific priorities. If requests for additional enabling activities assistance keep the total costs (new request and previous enabling activity assistance) to less than US$450,000, the additional resources may be approved by the CEO. If the requested increase results in a total cost of enabling activities above US$450,000, it must be submitted to the Council for approval.



1.3.5 

Small Grants Program (SGP)

A SGP is administered by UNDP and provides grants up to US$50,000 to community-based organizations and NGOs for activities that address local biodiversity-related problems. Each country participating in the SGP has its own National Coordinator, National Selection Committee, and National Strategy. Project selection occurs at the national level by the Selection Committee and does not require GEF Council approval. The SGP is managed solely by UNDP. To date it has provided grants to more than 1200 NGO-executed projects. For more information on the SGP see: http://www.undp.org/sgp/



1.3.6 

Environmental investment funds

It is also worth noting that some of the full- and medium-sized grants have supported environmental investment funds designed explicitly to finance biodiversity-based enterprises. Typically, the GEF provides grants for the "biodiversity overlay" to these funds (e.g. technical assistance, monitoring biodiversity impacts, etc.). Investment funds that have been supported include, for example: Eco-Enterprises Fund (EEF), Terra Capital Fund, and Small- and Medium-scale Enterprises Fund (SME).



1.4 

Advantages and Disadvantages of GEF financing

Advantages

Disadvantages

  • The GEF is an important source of large-scale grant funding.
  • The GEF structure, grant selection process, and portfolio is publicly accessible. Information on all past and present projects can be found on the GEF web site.
  • The GEF seeks to "mainstream" global biodiversity concerns into the regular project portfolios of the three IAs.
  • The GEF funds a wide variety of institutions, including governments, NGOs, and the private sector. In particular, the GEF has become an important source to support NGO-led conservation projects.
  • GEF has been the major funder of Conservation Trust Funds (see chapter on CTFs).
  • GEF provides funding to support other innovative finance mechanisms, such as environmental investment funds, and is currently examining other innovative opportunities for deploying its capital.
  • Can take a long time (three years or more) and significant commitment of resources to secure funding, particularly for full-size projects.
  • The diverse range of actors involved in the project cycle can make project approval a complex process.
  • Project proponents must learn to successfully negotiate complex project development procedures of IAs.
  • Only incremental costs related to realizing global biodiversity benefits are funded directly.
  • Short funding cycle limits potential to achieve financial sustainability.



1.5 

Success Factors



1.6 

Step-By-Step Methodology

The step-by-step approach and standard procedures to gain GEF approval of a project are known as the GEF project cycle. The steps and documentation required are determined by the type of project:

Graphic

Source: "GEF Project Cycle" - GEF/C.16/Inf.7



1.6.1 

Project Cycle: Full-sized Projects

The steps described below should be followed to receive approval of a full-sized project or of an enabling activities project of more than US$450,000. These steps are sequential and assume that a project proposal has cleared each step before proceeding to the next one. The preparation of a project proposal may be abandoned at any of the steps, and a proposal should not be considered approved until it completes the final step. Though mentioned below, medium-sized project cycles are looked at in more detail later in this chapter.

Phase I: Project Concept Development

Box 1. Items Eligible for PDF-A

Funding can cover: (i) local consultations, national hearings, and/or workshops to discuss specific project and/or program ideas, including translation into local languages where appropriate and the preparation of background papers that could facilitate discussion; (ii) travel costs for local experts to visit neighboring countries for consultations and discussions on potential transboundary projects; (iii) consultancies to developed program and/or project options, including the preparation of terms of reference for feasibility studies, strategy papers and, where possible, the preparation of such papers; (iv) scientific, technical and environmental reviews of proposed projects to ensure that they warrant further consideration; and (v) costs of external expertise, as appropriate.

Step 1 Project Concept Document (See Annex 2 for a sample format)

Click here for an example of a project concept document.

Box 2 Eligibility Requirements

Any eligible individual or group may propose a project, which must meet two key criteria: It must reflect national or regional priorities and have the support of the country or countries involved, and it must improve the global environment or advance the prospect of reducing risks to it. Country eligibility to receive funding is determined in two ways. Developing countries that have ratified the relevant treaty are eligible to propose biodiversity and climate change projects. Other countries, primarily those with economies in transition, are eligible if the country is a party to the appropriate treaty and is eligible to borrow from the World Bank or receive technical assistance grants from UNDP.

  • In sum, GEF projects must:
  • Be country-driven and endorsed by host government
  • Produce identifiable, quantifiable global benefits
  • Include participation of all affected groups and transparency
  • Be consistent with the Conventions
  • Possess strong scientific and technical merit
  • Be financially sustainable and cost-effective
  • Include rigorous processes for monitoring, evaluation, and incorporation of lessons learned
  • Play a catalytic role that leverages other financing
  • Contain a budgeted communication component

Step 2 First GEF Decision: Secretariat Review for Concept Agreement and Entry to GEF Pipeline

Step 3 Phase II: Project Preparation

PDF-B: In some cases, an IA may also seek a grant of up to US$350,000 for project preparation costs. This option is only available for full-sized projects, including enabling activity projects requesting more than US$450,000. To streamline the review process, requests for PDF-B may be submitted at the time entry is sought to the pipeline, as the PDF document is also sent to the other IAs, to the relevant Expanded Executing Agencies, the relevant convention secretariat, and the STAP Chairman. In fact, an application for PDF-B can double as a Concept Document provided it contains the information required for Concept Agreement Review as described in the Project Review Criteria referred to above. Each PDF-B request must be endorsed by the national operational focal point of the recipient country, and approval is given by the CEO. PDF-Bs for those projects that have entered the GEF pipeline will be circulated for review and for CEO approval within five working days on a rolling basis. For an example of a PDF-B request click here. Also see Annex 4 for a sample format.

Box 3. Items Eligible for PDF-B

PDF-B funds can normally be used; (i) to provide information necessary for the preparation of GEF

project proposals including pre-feasibility, feasibility, basic costing, technical and scientific design

parameters, and the development of a financing plan, including an assessment of incremental costs;

(ii) for in-country preparation of the project proposal, including project workshops, consultation with

interested parties and stakeholders, and local participation, where warranted in project design; (iii) for

national and/or sectoral preparatory work required for the design of the proposed GEF activity. This

could include assistance in preparing sectoral plans and programs (such as energy, industry, or

agriculture) which have a direct bearing on project design; national policy analysis; and inventories and

data analysis in support of the proposed project; and (iv) for small community-based activities to prepare

for project implementation.

Box 4. Streamlined Country Endorsement

Endorsement by the country operational focal point is a requirement for (i) any approval of funds from the Project Development Facility (PDF); and (ii) a project to enter the work program. Endorsement from the national operational focal point is not a requirement to submit a Project Concept Document for review prior to entry into the GEF pipeline. Nevertheless, a number of country operational focal points have objected to the inclusion in the GEF pipeline of concepts for projects to be carried out in their respective countries that have not been endorsed by the focal point, and they have insisted on endorsement prior to concept submission. To reduce multiple country endorsements and streamline project processing, countries may choose, on a case-by-case basis, to have an endorsement by the national operational focal point provided at the time of a PDF-B request suffice as an endorsement for the project proposal subsequently submitted for inclusion in the work program. If a country were to choose this option, the letter of endorsement from the country for the PDF-B request should clearly state that the operational focal point does not want to endorse the project again prior to inclusion in the work program (with the exception of medium-sized projects, country endorsement submitted with a PDF-A request will not suffice as an endorsement for subsequent project processing; an additional country endorsement is required for a PDF-C, usually requested for further project preparation after a project has been approved by the Council or recommended for work program inclusion by the CEO. For medium-sized projects, countries may choose to have an endorsement of the PDF-A suffice as an endorsement for the project brief subsequently submitted for CEO approval by stating this clearly in the letter of endorsement for the PDF.).

However, if the Secretariat were to determine that the project design had fundamentally changed between approval of the PDF-B and the project proposed for work program inclusion or that there were specific country commitments in the project proposal that required clarification, then the Implementing Agency would be requested to solicit a new endorsement from the national focal point prior to inclusion of the proposal in the work program. National focal points who wish to endorse concepts prior to their entry into the GEF Pipeline may continue to do so. The IA developing the concept for pipeline entry will be responsible for (i) informing the focal point about concepts submitted for review prior to entry into the GEF pipeline; and (ii) advising them on GEF requirements regarding formal country endorsements in the GEF project cycle. In all cases, the GEF Secretariat will inform the relevant focal point of concepts that have entered in the GEF pipeline.

STAP Roster Review. For each project in the GEF pipeline, the IA must seek a scientific and technical review from an expert selected from the STAP Roster. In exceptional circumstances, due to the nature of the project, the IA may use another reviewer if the Chairman of STAP agrees. The IA must append the review to the project proposal and explain how it has responded to the comments. STAP roster reviews are not required for projects that do not require Council approval (and are therefore not in the GEF pipeline). Click here for an example of a STAP review.

Step 4: Project Brief (See Annex 5 for a sample format)

China Sustainable Forest Development Project

Pakistan Mountain Areas Conservancy Project (MACP)

Box 5. Items Eligible for PDF-C

Access to PDF-C funds would normally be limited for those projects which: (i) have been approved by the Council, but require more technical work; (ii) are large scale, normally infrastructure, projects which require considerable technical design and engineering feasibility work; and (iii) where all preconditions of project preparation have been met, including national consultations, technical and engineering pre-feasibility work, and country commitment.

Step 5: Second GEF Decision: Secretariat Review for Work Program Inclusion

Phase III: Project Appraisal

Third GEF Decision: Secretariat Review for CEO Endorsement

Step 6: Project (appraisal) document

Phase IV: Project Approval and Implementation Supervision

Box 6. Annexes to a Final Project Document.

Annex 1: Project Design Summary

Annex 2: Project Description

Annex 3: Estimated Project Costs

Annex 4: Incremental Cost Analysis

Annex 5: Financial Summary

Annex 6: Procurement and Disbursement Arrangements

Annex 7: Project Processing Schedule

Annex 8: Documents in the Project File

Annex 9: Statement of Loans and Credits

Annex 10: Country at a Glance

Annex 11: Stakeholder Analysis and Participatory Approach


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