Struggling to fund transformational initiatives: Hela Cheikhrouhou’s first interview since stepping down as Executive Director of the Green Climate Fund

September 3, 2016

Steve Herz.  The Green Climate Fund is mostly being fed existing, conventional projects by its accredited entities, development banks.  If the partner organization was planning to fund the project regardless of GCF involvement, the additional value of the GCF’s contribution is essentially zero.  This could explain why supposedly only 2% of funds are going to distributed renewable energy — leaving a large gap for civil society to act.

In her first interview since stepping down as Executive Director of the Green Climate Fund (GCF), Hela Cheikhrouhou offered a candid and spot-on assessment of the organization’s biggest challenge: despite the GCF’s mandate to support highly innovative, “paradigm shifting” actions, it has struggled to fund initiatives that are truly transformational. Instead, the GCF has largely supported relatively conventional projects that don’t aspire to effect broad change.

A solar project approved by the GCF Board at its last meeting in July underscores her point. The Board agreed to provide a $49 million loan to a large solar farm in Chile’s Atacama desert. To be sure, utility scale solar energy projects will be a key component of Chile’s energy transition, but Chile’s solar revolution is already well under way. Grid connected solar power has quadrupled over the last three years. Chile already has a relatively well developed ecosystem of funders and developers who are proposing new projects to take advantage of the Atacama’s world class solar resources. And solar power is already highly competitive in Chile’s energy markets. Just last week, the developer of a similar project in the same region won Chile’s latest energy auction with a world record-setting bid to provide energy at 2.91 cents/kWh. In this context, it is hard to see how any one solar project, regardless of its merits, could transform Chile’s electricity sector. Such projects would be better left to other institutions with different mandates.

The problem is not with the GCF per se; it is mainly with its accredited entities. The GCF relies on these partner agencies to bring it projects for consideration. But too often, instead of devising innovative and ambitious new initiatives, they have chosen to promote run-of-the-mill projects that are already moving through their pipelines. This has obvious advantages for the accredited entity—it allows them to spread risk and frees up their own resources to support other projects. But it’s a bad deal for the GCF. Not only does it tend to generate projects that are not crafted with the Fund’s mandate in mind, it also raises significant questions about the value of the GCF’s contribution. If the partner organization was planning to fund the project regardless of GCF involvement, the additional value of the GCF’s contribution is essentially zero. Nevertheless, every project that has been put before the Board so far has been approved.

To their credit, a number of GCF Board members have recognized the problem and expressed concern. Zaheer Fakir, a co-chair of the Board, recently implored accredited entities to bring “more ambitious, paradigm-shifting proposals,” and several Board members have indicated that they will not continue to support projects that can’t make a strong claim to effect systemic change.

The problem, however, is not likely to resolved soon, and the stakes are about to be raised considerably. It is one thing for the GCF to support a project such as the Chile solar farm, which may be unexceptional and essentially business as usual, but at least is relatively benign in terms of its potential risks. However, accredited entities are now starting to put forward projects from their pipelines with much higher levels of fiduciary and environmental and social risk.

For example, the World Bank Group is seeking GCF support for two large hydropower projects. Hydropower has a conspicuously poor record of cost and time overruns, development impact, and environmental and social harm. Worse, as an Oxford researcher once put it, proponents of such large projects tend to get those projects built by constructing “a fantasy world of underestimated costs, overestimated revenues, overvalued local development effects, and underestimated environmental impacts.”

It is not clear that the GCF has developed the capability to manage these risks. After all, it does not yet even have a comprehensive environmental and social management system in place. But even if it did, the Board should not consider approving such high-risk projects without first demanding a compelling showing of transformational impact. That will require a kind of paradigm shift on the part of the Board: a newfound willingness to rigorously question its partners on whether the benefits of their proposals are truly systemic and non-incremental and, more than anything, a simple willingness to say no.

**

Earlier links – skip to bottom for “Letter from the Global South on the Green Climate Fund” – from 500 organizations

Keep Dirty Energy Out of Green Climate Fund, Demand Activists and Community Groups

By: International Rivers, Institute for Policy Studies, and Friends of the Earth US
Date:  Thursday, May 15, 2014

A coalition of nearly 300 civil society organizations mainly from developing countries are raising alarms that the GCF could be used to finance projects that are just a little less dirty than ‘business as usual,’ including fossil fuels, dams, nuclear energy, and biomass, among others.  These citizens groups represent communities on the frontline of climate change – the people that the fund is meant to support.

From May 18-21, 2014, the 24 members of the Board of the Green Climate Fund will meet at its headquarters in Songdo, South Korea. They are expected to complete final steps to declare the fund operational – a moment long-anticipated by governments and civil society in both developed and developing countries.

Lidy Nacpil, Director of Jubilee South Asia/Pacific Movement on Debt and Development – which joined the citizen groups in sending a letter to GCF board members raising their concerns – said, “We are organizations, movements and communities from developing countries whose citizens bear the brunt of the most harmful consequences of climate change.”

Nacpil, who is in Songdo for the Board meeting, added, “We’ve seen first hand how international financial institutions include fossil fuel and other harmful energy projects in their climate and energy finance under the flawed logic of ‘lower carbon’ energy and switching to ‘lower emissions’ fuels. Financing any fossil fuels and harmful energy through the Green Climate Fund is unacceptable.”

Groups in the United States, led by the Institute for Policy Studies, International Rivers, and Friends of the Earth U.S., have joined their effort.  These U.S. groups are reaching out to United States representatives on the Green Climate Fund’s board, and are urging them to keep dirty energy out of the Green Climate Fund.

Janet Redman, Director of the Institute for Policy Studies’ Climate Policy Program, also in Songdo, noted that, “195 countries came together to create the Green Climate Fund in order to help finance the transition in developing countries from dirty energy development to clean energy, climate-resilient economies.”

Redman added, “Common sense says that financing any fossil fuels or harmful energy through the Green Climate Fund is totally inconsistent with what climate scientists say we need to do to avoid runaway climate change. This fund is so important precisely because it’s meant to support a paradigm shift to sustainable development.”

Zachary Hurwitz, Global Standards Coordinator at International Rivers pointed out, “There’s nothing – yet – in the Fund’s rules to stop it from financing false solutions like ‘clean’ coal, natural gas fracking, destructive dams, or even nuclear power in the name of ‘low-emissions’ energy. We need to make sure there is – and we need the U.S. to be a champion.”

Hurwitz added, “President Obama has already promised to wind down support for dirty coal projects overseas. And Congress recently limited support for the types of destructive hydropower dams that often displace communities and decimate whole ecosystems. Saying no to harmful energy in the Green Climate Fund is a logical next step for the United States.”

Karen Orenstein with Friends of the Earth U.S. said, “For the sake of our families, our communities and our planet, we have to keep the Green Climate Fund clean.”

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More information:

Statement from Global South Civil Society Calling for No Dirty Energy in the Green Climate Fund

Dear Members and Alternate Members of the Board of the Green Climate Fund,

We are organizations, movements and communities from developing countries whose citizens bear the brunt of the most harmful consequences of climate change. The Green Climate Fund is of vital concern for us as the mobilization of unprecedented levels of finance is urgently needed as part of an immediate and strategic response to the climate crisis.

All efforts must be made to ensure that climate finance is provided adequately, allocated equitably and used effectively to enable all people (irrespective of gender, class, religion or age), communities and nations to deal with present and future impacts of climate change and to make the systemic transformation necessary to prevent worst-case catastrophes, halt global warming and heal the planet.

We urge you to make it an explicit policy – as part of the Investment Framework and Results Management Framework — that GCF funds will not be used directly or indirectly for financing fossil fuel and other harmful energy projects or programs.  We note with grave concern and alarm how other international financial institutions include these types of projects in their climate and energy financing, under the logic of “lower carbon” energy and switching to “lower emissions” fuels.

Financing any fossil fuels and harmful energy through the Green Climate Fund is unacceptable. It is fundamentally in conflict with the mandate provided by the Governing Instrument for the Green Climate Fund and the principles of the UN Framework Convention on Climate Change.  For the Green Climate Fund to have transformational impact, it should not promote “business-as-usual” energy solutions in the name of providing energy access for all – an important goal that can and must be met through clean energy solutions.

Further, we urge you to adopt an “exclusion list” as part of the Green Climate Fund policies on environmental, social, gender and financial safeguards and protection – a practice of several international financial institutions and national development finance institutions. We stand ready to engage and contribute to the development of such a policy.

Our calls are also strongly endorsed by colleagues and organizations based in developed countries listed after the signatories.

Signatories and Endorsers:

Organizations from Developing Countries and Global South Networks

REGIONAL and GLOBAL SOUTH ORGANIZATIONS

Jubilee South – Asia/Pacific Movement on Debt and Development

LDC Watch

Migrant Forum in Asia

South Asia Peasants Coalition

Third World Network

South Asia Alliance for Poverty Eradication

NGO Forum on the ADB

Asian Indigenous Women’s Network (AIWN )

Tebtebba (Indigenous Peoples’ International Centre for Policy Research and Education)

No REDD in Africa Network (NRAN)

Pan African Climate Justice Alliance (PACJA)

African Biodiversity Network (ABN)

350.org (Africa and Middle East)

Greenpeace Southeast Asia

CAN South Asia

Interamerican Association for Environmental Defense AIDA

Global Indigenous Peoples Partnership on Climate Change, Forests and Sustainable Development

IBON International

GAIA – Global Alliance for Incinerator Alternatives

Global Forest Coalition

Focus on the Global South

Non-Timber Forest Products Exchange Program for South and Southeast Asia

Indigenous Peoples Movement for Self-determination and Liberation (IPMSDL)

Asia Pacific Forum on Women, Law and Development (APWLD)

Friends of the Earth International

NATIONAL ORGANIZATIONS in ASIA and the PACIFIC

BANGLADESH

Bangladesher Jatiyo Sromik Jote-BJSJ

EquityBD Bangladesh

Nabodhara Bangladesh

Unnayan Onneshan Bangladesh

Bangladesh Krishok Federation

Bangladesh Kishani Sabha

Bangladesh Adivasi Samity

Bangladesh Floating Labor Union

Bangladesh Floating Women Labor Union

Bangladesh Rural Intellectuals’ Front

Biplobi Jubo Sabha, Bangladesh

Ganochchaya Sanskritic Kendro, Bangladesh

Swadhin Bangla Garments Sramik o Karmochari Federation, Bangladesh

Nabodhara, Bangladesh

VOICE, Bangladesh

Online Knowledge Society, Bangladesh

Maleya Foundation, Bangladesh

Coastal Livelihood and Environmental Action Network (CLEAN), Bangladesh

CHINA

Greenovation HUB

EAST TIMOR

Haburas Foundation/Friends of the Earth East Timor

INDIA

Indian Social Action Forum

Kerala Independent Fishworkers Federation, India

Environics Trust

Mines Minerals & People, India

Himalaya Niti Abhiyan (NHA)

Keystone Foundation, India

PAIRVI (Public Advocacy Initiatives for Rights and Values in India)

Beyond Copenhagen Collective

Himal Prakriti

River Basin Friends, Northeast India

Bharat Jan Vigyan Jatha (India People’s Science Campaign)

Centre for Community Economics and Development Consultants Society

Gujarat Forum  on CDM

Water Initiatives Odisha

INDONESIA

AKSI Indonesia

Koalisi Anti-Utang Indonesia

KRUHA Peoples Coalition for the Right to Water Indonesia

Solidaritas Perempuan Indonesia

Indonesia Civil Society Forum for Climate Justice

debtWATCH Indonesia

Gema Alam West Nusa Tenggara – Indonesia

Institute for Essential Services Reform (IESR)

WALHI/FoE Indonesia

Mining Advocay Network, JATAM, Member of CSF-CJI

Manikaya Kauci Foundation, Indonesia

Non-Timber Forest Products Exchange Program Indonesia

REPUBLIC OF SOUTH KOREA

Transparency International Korea Chapter

Energy and Climate Policy Institute for Just Transition, South Korea

MALAYSIA

Friends of the Earth Malaysia

SAVE Rivers Network Sarawak, Malaysia

NEPAL

All Nepal Peasant Federation

All Nepal Women Association

Campaign for Climate Justice Network, Nepal

Jagaran Nepal

Rural Reconstruction Nepal

Campaign for Climate Justice (CCJN), Nepal

Jeunes Volontaires pour l’Environment Nepal (JVE-NEPAL)

Garjan.Org, Nepal

National Forum for Advocacy, Nepal (NAFAN)

South Asian Dialogues on Ecological Democracy (SADED)

PAKISTAN

Pakistan Fisherfolk Federation

Pakistan Kissan Rabita Committee, Pakistan

PHILIPPINES

Freedom from Debt Coalition

Philippine Movement for Climate Justice

Aksyon Klima Pilipinas,

Institute for Climate and Sustainable Cities

Philippines Rural Reconstruction Movement (PRRM)

Sanlakas

Kalayaan

WomanHealth Philippines

Partnership for Clean Air (PCA) Inc.,

Ateneo School of Government

Ecological Society of the Philippines

Alyansa Tigil Mina, Philippines

Partido ng Manggagawa (Labour Party of the Philippines)

Bukluran ng Manggagawang Pilipino (Solidarity of Filipino Workers)

PhilNet-RDI at PRDCI

Green Convergence for Safe Food, Healthy Environment and Sustainable Economy

Coastal Core, Inc., Sorsogon City, Philippines.

Miriam P.E.A.C.E.

EcoWaste Coalition, Philippines

NGOs for Fisheries Reform (NFR), Philippines

kitanglad integrated ngos (KIN)

Peoples Movement on Climate Change

Koalisyon Pabahay ng Pilipinas

SARILAYA

WWF Philippines

Center for Power Issues and Initiatives

Sagip Sierra Madre Environmental Society, Inc. (SSMESI)

Cordillera Peoples Alliance – Philippines

Network for Sustainable Livelihood Catalysts, Inc. NSLC

Responsible Ilonggos for Sustainable Energy (RISE)

SRI LANKA

National Fisheries Solidarity Movement  (NAFSO) Sri Lanka

Center for Environmental Justice/Friends of the Earth Sri Lanka

Janathakshan, Sri Lanka

National Fisheries Solidarity Movement, Sri Lanka

TAIWAN

Taiwan Environmental Protection Union, Taipei, TAIWAN

TAJIKISTAN

Little Earth, Tajikistan

THAILAND

Forest and Farmer Foundation (FFF), Thailand

 Thai NGO Committee on Agrarian Reform and Rural Development (ThaiNGOWCARRD)

CAN Thailand

Centre for Community Empowerment for Environmental Rehabilitation, Thailand

Climate Watch Thailand

VIETNAM

 350.org Vietnam

NATIONAL ORGANIZATIONS in LATIN AMERICA & THE CARIBBEAN

BOLIVIA

Bolivian platform on Climate Change

Fundacion Solon

BRAZIL

Vitae Civilis, de Brasil

Observatorio do Clima

COLOMBIA

Asociación Ambiente y Sociedad

Dejusticia Colombia

GUYANA

Global Youth Movement – Guyana

HONDURAS

Fundacion De Iniciativas De Cambio Climatico De Honduras

Fundacion MDL De Honduras

MEXICO

Centro de Transporte Sustentable EMBARQ México

Equidad de Género: Ciudadania, Trabajo y Familia, México

Instituto de Políticas para el Transporte y el Desarrollo (ITDP), Mexico

PANAMA

Asociación Ambientalista de Chiriquí

PERU

Citizen Mouvement on Climate Change ( MOCICC) – PERU

NATIONAL ORGANIZATIONS in AFRICA

REPUBLIC of CHAD

Association pour le Marketing Social au Tchad

ETHIOPIA

Ethiopian Society for Consumer Protection;

Wolaitta Development Association, Ethiopia

National Food Secuirty and Environment Forum of Ethiopia

THE GAMBIA

Worldview-The Gambia

REPUBLIC of GHANA

Abibimman Foundation, Ghana

GUINEA

Guinée Ecologie

REPUBLIC of DJIBOUTI

Organisation de Bienfaisance et de Développement (Hodagad)

REPUBLIC of KENYA

Jamaa Resource Initiatives, Kenya

MADAGASCAR

Youth Network for MDGs Madagascar

MALAWI

Malawi Economic Justice Network (MEJN), Malawi

MAURITIUS

Mauritius Council for Development Environmental Studies and Conservation (MAUDESCO), Mauritius

REPUBLIC of MOZAMBIQUE

JA! Justiça Ambiental/ FoE Moçambique

NIGERIA

Center for 21st Century Issues, Nigeria

NGO Coalition for Environment (NGOCE), Calabar, Nigeria

Labour,Health and Human Rights Development Centre

Climate Change Network Nigeria

REPUBLIC of SENEGAL

Senegalese Social Forum

ONG Panafricaine Pour l’Education au Développement Durable (PAEDD), Senegal

ONG PanAfria Yung  Man’s Organization

ARCADE (Association for Research and Training for Endogenous Development)

African Forum for Alternatives

SIERRA LEONE

Youth Partnership for Peace and Development, Sierra Leone

SOMALIA

Somali Organisation for Community Development Activities

SOUTH AFRICA

groundWork (friends of the earth South Africa)

Southern and East African Trade Institute (SEATINI), South Africa

SOUTH SUDAN

Community Empowerment for Progress Organization-CEPO, South Sudan

TOGO

Jeunes Volontaire pour l’Environnement (JVE-Togo)

REPUBLIC of UGANDA

National Association of Professional Environmentalists (NAPE) – Friends of the Earth Uganda

Southern and Eastern Africa Trade Information and Negotiations Institute (SEATINI)

THE ZAMBIA

Zambia Youth Climate Change Forum (ZYCCF)

Zambia Climate Change Network (ZCCN)

Endorsers from Organizations based in Developed Countries

INTERNATIONAL and REGIONAL ORGANIZATIONS

Action Aid

Carbon Market Watch

CARE International – Poverty, Environment and Climate Change Network (PECCN)

Corporate Europe Observatory

CAN-Europe

Greenpeace

350.org

Earth in Brackets

Food & Water Watch

Helio  International

Indigenous Environmental Network (IEN)

International Forum on Globalization

International Rivers

International Institute of Environment and Development (iied)

Oxfam

WWF International

Women’s Environment and Development Organization (WEDO).

NATIONAL ORGANIZATIONS

NORTH AMERICA

Institute for Policy Studies

Heinrich Boell Foundation North America

Ulu Foundation

Sierra Club

Friends of the Earth US

Center for Biological Diversity

Climate Wise Women

EcoEquity

Rainforest Action network

Center for International Environmental Law

U.S. Climate Plan

SustainUS

The Ecologist

World Team Now (WTN)

Jubilee USA Network

Friends of the Earth US

EUROPE

Friends of the Earth England Wales and Northern Ireland

World Development Movement, UK

Christian Aid UK

Catholic Agency for Overseas Development (CAFOD) UK

Bread for the World Germany

Germanwatch

Healthy Planet UK

Ecologistas en Accion  Spain

Global Social Justice  Belgium

11.11.11 Belgium

Alliance Sud,  Switzerland

Iceland Nature Conservation Association

Climate Action Network Europe

Ecology Collective / Ekoloji Kolektifi, Turkey

Both ENDS, Holland

GAIA Foundation UK

Green Alliance, Belarus

Quercus – Associação Nacional de Conservação da Natureza, Portugal

Trócaire, Ireland

Tearfund, UK

Friends of the Earth Norway

Debt and Development Coalition Ireland

ReCommon Italy

PACIFIC

Jubilee Australia

Climate Justice Programme, Australia

ATTAC, Japan

Friends of the Earth Japan