| Project Detail |
Project ID
200158
Thematic Priority
Safeguarding the Environment
LocationSao Tome and Principe
The GCF Readiness proposal is a spin-off of the currently implemented Global Environment Facility (GEF) funded project “Strategic program to promote RE&EE investments in the electricity sector of São Tomé and Príncipe" (SAP 150124).The proposal was jointly developed with the local counterparts in the beginning of 2020. It still requires internal approval according to the new DGB/2020/07 and DGB/2016/6. The GCF Readiness support will build the capacities of the Government of Sao Tome and Principe (STP) to formulate and implement a paradigm-shifting renewable energy (RE) and energy efficiency (EE) investment program, which will enable the country to achieve its climate mitigation targets in the Nationally Determined Contribution (NDC) and the 3rd National Communication on Climate Change (NCCC). Through RE&EE improvements, the country aims to reduce its GHG emissions significantly in comparison to the reference scenario 2012 to 2030. The 3rd NCCC has recommended the implementation of thirteen RE&EE mitigation actions. In this context, the General Directorate for Natural Resources and Energy (DGRNE) of the Ministry of Infrastructure, Natural Resources and Environment (MOPIRNA) and the National Designated Authority (NDA) at the Ministry of Planning, Finance and Blue Economy (MPFEA), are partnering with the United Nations Industrial Development Organization (UNIDO) to implement a GCF Readiness support program. The proposed GCF Readiness grant will help to overcome existing constraints in the RE&EE sector. The market introduction of new technology products, services and business models in STP, requires specific pull and push actions directed to overcome demand (consumers of products and services) and supply-side (suppliers of products and services) barriers. These barriers are related to institutional capacity and coordination, policy and regulation, knowledge and awareness, qualification and certification, entrepreneurship and innovation, access to finance and technology. Past readiness support in the RE&EE sector in STP was rather fragmented and uncoordinated. These efforts have been focused solely on the electricity sector and existing barriers for RE&EE were not addressed comprehensively and across sectors. The impact of these scattered interventions has been very limited. Over the past ten years, STP has had not no measurable advances regarding renewable energy (RE) and energy efficiency (EE). The EE sector and the distributed and rural RE sector have not got any notable attention. The suggested Readiness proposal applies a holistic approach and focuses on a paradigm-shift of the entire energy sector. It builds on past and ongoing readiness activities and will complement and/or upscale existing support and close existing gaps in the support framework. These gaps exist particularly in the EE sector and with regard to distributed and rural RE dimension (e.g. net-metering, mini-grids, solar thermal, bioenergy).The main direct beneficiaries (target groups) of the Readiness support are DGRNE/MOPIRNA, the NDA and other institutional players in the energy sector, such as the National Water and Electricity Company (EMAE), the General Regulatory Authority (AGER), the Autonomous Region of Principe (RAP), as well as domestic businesses and banks active in the RE&EE sector. The final beneficiaries are energy consumers, which will benefit from the increased availability of reliable, affordable and sustainable energy products and services. The Readiness support will enhance the capacities of DGRNE/MOPIRNA and the NDA to assume leadership in the development and enforcement of a policy and regulatory framework, conducive for RE&EE market development and de-risking of private participation, foreign direct investment and project finance. The Readiness grant will help DGRNE/MOPIRNA as an executing partner of international climate finance by enforcing fiduciary standards, policies and processes in line with GCF and other international requirements. The Readiness proposal includes support for RE&EE policy and regulation, knowledge management, capacity building, as well as investment and business facilitation. Regarding RE, the focus lies on specific regulations and practical documents/procedures, which aim to reduce risks for private participation (e.g. IPPs, PPPs, auto-producers) and project finance (equity, concessional and non-concessional finance), particularly in the area of run-off-river micro/small hydro power and solar Photovoltaics (PV). Moreover, the support will look into innovative areas such as the application of solar thermal systems in the health, tourism and industrial sector, energy storage and smart grids, as well as ocean energy technologies in the context of the blue economy. In the area of EE the focus lies on baseline studies and the development of standards and regulations in the area of appliances (lighting, air conditioning, and refrigeration), commercial electricity losses, low-carbon transport (e.g. fuel and vehicle standards) and efficient cooking. The Readiness grant will facilitate relevant trainings for key stakeholders in the above mentioned areas and will strengthen the capacities of local energy businesses through an entrepreneurship facility and by fostering dialogue with the domestic banking sector. Finally, the Readiness grant will enable DGRNE/MOPIRNA to develop a concept note for a RE&EE investment program, which will be submitted by a qualified direct access entity to the GCF Project Preparation Facility (PPF). |
