Type of Review: Annual Review
Project Title: Nepal Climate Change Support Programme
Date started: January 2011
Date review undertaken: 30/11/13
Introduction and Context
What support is the UK providing?
The UK is providing support to the Government of Nepal to enable Nepal’s poorest and most
vulnerable to adapt to climate change. This will also build the capacity of the Government, civil
society and the private sector to provide climate and renewable energy services to reduce the
climate vulnerability in the project area and at the National level.
This is the first phase of a two phase programme that will help reduce the vulnerability of 3
million women and men in the Mid and Far West of Nepal, the most climate vulnerable region
in the country. The Nepal Climate Change Support Programme (NCCSP), with UK funding of
(£10.6m) combined with EU support of (£7.6m), and technical support from UNDP, is the first
programme to put the Government’s National Adaptation Programme of Action into practice.
This includes the commitment to ensure that at least 80% of resources directly flow to
beneficiaries, to provide support for irrigation, landslide and flood protection, access to clean
energy and promotion of climate resilient crops.
This first phase of the programme is focusing on 14 Districts1 in the Mid and Far West of Nepal
which the National Adaptation Plan of Action (NAPA) identified as the most climate vulnerable
and for which the Government requested support from donors, as its first priority. The NCCSP
programme has a specific focus on helping women cope with the challenges climate change is
bringing. The second Phase of the NCCSP project proposed in DFID’s operational plan will
provide a further £15m to scale up the approach and ensure the results set in DFID’s
Operational Plan are achieved.
The programme was due to start in early 2011, however due to negotiations over the project
management arrangements and the subsequent preparation of UNDP technical assistance
document, it was delayed until mid-2012. However, support for the renewable energy
component was delivered on time, and provided support for the installation of solar home
systems and the climate and carbon unit (CCU) within the Ministry of Environment’s
Alternative Energy Promotion (AEPC) Centre.
What are the expected results?
The main results to be delivered by the programme are:




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1,650,000 women and girls and 1,350,000 men and boys in 14 districts with increased
resilience to climate change (including natural disasters)
14 districts and 2 line ministries with the capacity to implement effective climate change
responses
360,000 people with access to modern, low carbon energy
1 national low carbon climate resilience strategy
Humla, Mugu, Dolpa, Bajura, Jumla, Jajarkot, Rukum, Achham, Dailekh, Rolpa, Kailali, Bardiya, Kalikot and Dang
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What is the context in which UK support is provided?
The Climate Change Risk Atlas 2010 ranks Nepal as the 4th most vulnerable country
worldwide, indicating the extreme vulnerability that the country faces2. Nepal’s climate
vulnerability is due to a combination of under-development and its geography which makes
the risks of climate hazards particularly high.
More than 4,000 people died in Nepal over the last ten years in climate induced disasters,
which caused economic losses of USD 5.34 billion. In the last two years over 1.9 million
people have been severely affected by similar events and their frequency is likely to increase
in the future3. Every year more than 1 million people are directly impacted by climate induced
disasters such as drought, landslides and floods4.
Nepal faces significant development challenges to achieve sustainable poverty reduction in a
a post-conflict situation, and with an economy based on natural resources, and where the
scale of climate change challenges are becoming more apparent (despite Nepal being one
of the lowest per capita greenhouse gas-emitting countries).
Unavoidable climate change now threatens to reduce the effectiveness of development
initiatives. For example, reduced rainfall in the mid hills and western regions – added to a
trend of warming – will reduce food security and affect the availability of water resources,
increasing the vulnerability of the poor. Further, increases in the intensity of rains in other
parts of Nepal – particularly those where the topography is broken and soils eroded – will
lead to increased flooding and landslide risks threatening human security, water supplies,
and infrastructure.5
Communities consulted during the National Adaptation Plan of Action (NAPA) process stated
that they are already experiencing seasonal changes that are resulting in early sprouting,
flowering and fruiting. In some cases, these changes are bringing benefits to communities,
such as increasing the ecological range of cultivation for certain crops. In other cases,
climatic changes are having a negative impact, for example some herbs important for
livelihoods are declining and shifting to higher altitude ranges, green grass has declined
sharply in the Himalayan region and rainfall patterns are becoming increasingly erratic.
These impacts will be particularly felt by the 10 million people already vulnerable in rural
Nepal6, many of them women headed households and socially marginalised groups. Without
effective climate adaptation support these groups will remain trapped, or be tipped back, into
poverty.
2
3
WB, ADB and DARA reports (2010), Maplecroft Climate Change Risk Report (2009/10).
Vulnerability through the eyes of the vulnerable, ISET-Nepal 2009
4
Ministry of Home Affairs, Disaster Preparedness Network, Documentation Center, 2010
5
The Nepal National Adaptation Programme of Action, Ministry of Environment, September 2010
6 MoE. 2010. NAPA document
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Section A: Detailed Output Scoring
Output 1: Climate resilient development initiatives are implemented by poor and vulnerable
households in the most climate vulnerable districts
Output 1 score and performance description: A
The start-up phase of the programme has made considerable progress and established
project structures, mechanisms and baselines to effectively deliver adaptation at local level. In
70 VDCs in the programme districts, communities were consulted on climate vulnerability and
their priority adaptation activities. Consultation helped to raise local awareness on climate
impacts. Support to renewable energy also speeded up during the start-up phase with AEPC
enabled to continue providing solar subsidies to poor households.
Progress against expected results:

Provided low cost solar home systems to 50,000 rural poor households. This has
directly benefited women in their daily chores and school children.

Raised the awareness of 250,000 people on climate change and what they can do to
build their resilience.
Direct beneficiaries = 50,000
Indirect beneficiaries = 200,000

70 LAPAs in 14 Districts developed. These have prioritised the first round of immediate
actions for irrigation, flood and landslide protection, early warning systems, agricultural
and aquaculture training, renewable and efficient energy technology, forestry and water
management projects.
Recommendations:
Accelerate identification of service delivery agents at the local level to ensure delivery of
LAPAs at the start of the dry season. Ensure good synergies between the adaptation and
clean energy components in the project districts.
Impact Weighting (%):60%
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Revised since last Annual Review? N
Risk: Medium
Revised since last Annual Review? N
Output 2: GoN institutional and funding mechanisms developed to channel resources for
adaptation and climate resilient development initiatives effectively and accountably
Output 2 score and performance description: B
The programme has developed the institutional framework and coordination mechanism for
adaptation delivery in consultation with the Ministry of Finance and Ministry of Federal Affairs
and Local Development. The capacity need and fiduciary risks of all relevant government
agencies for adaptation delivery have been identified, budgeted and an action plan agreed
with each agency.
Although not directly attributable to the programme but as a result of the support provided by
UK fast start financing in 2011, there has been a growing awareness about climate budgeting
in key Government ministries including Ministry of Finance and Ministry of Federal Affairs and
Local Development. This year Nepal Government has allocated 1.34% of the total £5b
national budget for climate change. This is a significant step of Government towards
developing mechanisms for climate budgeting.
Progress against expected results:

The content and mechanism for UNDP technical assistance has been finalized and
agreed with the Government.

Staff recruitment at Project Central Office and districts completed.

Fund flow mechanism agreed with the government and local (14 districts) and national
level fiduciary risk mitigation measures identified and action plan drafted.

Study to identify coordination mechanism for various planning processes including
adaptation, disaster, forestry and energy completed. Recommendations from this study
will form a key part of implementation at district level.
Recommendations:
Ensure LAPAs are implemented through a well-coordinated process in districts for which
UNDP’s capacity itself needs to be up-scaled both at central and district levels. UNDP will
have to focus on increasing staff capacity and emphasise good and timely project
communication to donors and government.
Ensure effective controls to minimise fiduciary risks established and an action plan in place for
GOs and NGOs’ capacity building to minimize fiduciary risks for smooth delivery of project
results.
Impact Weighting (%): 15%
Revised since last Annual Review? N
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Risk: Medium
Revised since last Annual Review? N
Output 3: Government and non-government agencies equipped with skills and incentives to
deliver adaptation and climate resilient development initiatives.
Output 3 score and performance description: B
The capacity building elements of the programme are being defined by UNDP. A delayed start
up phase of the project has meant that elements of capacity building for government and nongovernment agencies, although have been identified, the implementation has suffered.
Progress against expected results:
The capacity building elements have not begun implementation. However agreement has
been reached on the scope and nature of these efforts with staff recruitment in central and
district project offices completed in July 2013.

Capacity development plan for project partners including government and nongovernment agencies and communities prepared. UNDP is currently in final stages of
outsourcing the capacity building component.

A detailed M&E framework for the project has been prepared. DFID’s Statistics Adviser
from Climate and Environment Department in his review of the M&E framework
suggested that information and data are of ‘average’ quality.
Recommendations:
Ensure capacity building plans are well defined, agreed jointly with stakeholders including
donor partners and implemented at the soonest. Any delays in the implementation will only
hamper project progress on the ground.
Impact Weighting (%): 15%
Revised since last Annual Review? N
Risk: Low
Revised since last Annual Review? N
Output 4: Climate compatible development policy framework in place at all levels
Output 4 score and performance description: A
Progress on the development of Nepal’s climate policy and LAPA framework has been good.
With both endorsed by cabinet over the past year. A national consensus has been established
on the suitability of framework in local context. Many partners including USAID, Practical
Action, WWF, CARE, Swiss Development Cooperation are already using LAPA framework for
the planning and implementation of climate adaptation activities at local level.
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Progress against expected results:

A summary report on approaches for National LAPA roll-out has been prepared. This
report highlights how various planning processes including disaster and forestry
planning can be integrated at local level and that such integration is possible.

A discussion group has been set up at the Ministry of Federal Affairs and Local
Development to carve out strategy to align LAPA with Environment Friendly Local
Governance.

Low carbon economic development strategy has been drafted and currently in
consultation process by the Government for its approval.

Ministry of Science, Technology and Environment reconvened the Multi Stakeholder
Climate Change Initiative Coordination Committee (MCCICC) in August 2013.

Establishment of Mountain Unit at the Ministry of Science, Technology and
Environment
with
support
from
DFID
India
and
the
project.
Recommendations:
LAPA framework has received a good national and international attention for the
implementation of climate adaptation activities. This momentum created by the project has to
be sustained. This will need a very strategic and quick support services to be channelled by
the UNDP TA so that both Government and non-government agencies take ownership and
understand the process on ground.
The focus of this year’s implementation will be in supporting District level planning processes
to integrate climate change and engage with a range of stakeholders in local disaster
committees and citizen awareness centres.
The continued political instability means that the low carbon economic development strategy
approval process may be delayed and will need to ensure that it is done through an open and
inclusive consultative process. The NAPA and LAPA processes already provide good
examples of how this can be done to ensure good cross party and cross interest group
ownership.
Impact Weighting (%): 10%
Revised since last Annual Review? N
Risk: Medium
Revised since last Annual Review? N
Section B: Results and Value for Money.
1. Progress and results
1.1 Has the logframe been updated since last review?
Yes but it will need a final endorsement by the Project Steering Committee. The new logframe
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includes revised indicators with new timelines and detailed baseline information and the
changes to the programme agreed that will be agreed by the NCCSP project steering
committee at the end the start –up phase (in September).
In October, DFID’s Statistics Adviser reviewed the indicators in line with ICF’s Key
Performance Indicators (KPI) and suggested that currently available data of the project are of
average quality. Against the recommendations from the review, the project will come up with a
few additional KPIs such as number of jobs created.
1.2 Overall Output Score and Description: A
Project spend so far has achieved good value for money primarily through results from LAPA
formulation, energy and policy component of the project. The solar home systems subsidy
programme provides limited subsidies and credit to the private sector to encourage them to
provide systems in rural Nepal, the more remote the bigger the subsidy and credit available.
On average the scheme costs £66 per household to help them purchase a system worth
£200-£400. The implementation of this component has been smooth and satisfactory even
under the prevailing unfavourable political situation.
Two bigger components of the project are Output 1 (LAPA implementation) with impact weight
of 60%) and Output 4 (policy work) with impact score of 15%. Both these outputs have
performed well, although with inputs of additional DFID resources. On-the-ground
implementation of this component, which is dependent on the delivery of Outputs 2&3, has
suffered considerable delays. DFID have continued to incur additional funds and staff time to
help GoN for delivery of results. Significant DFID staff time has gone into coordination,
communication and technical support for the project which otherwise was expected to be
provided by the UNDP and project staff at central level. There is a good ownership by the GoN
officials at central level. However, this needs to be scaled up and matched up by the UNDP
TA technical and management support.
1.3 Direct feedback from beneficiaries
As exemplified by local level LAPA orientation meetings, there has been much enthusiasm
and acceptance expressed by communities and local development offices about the
practicality of LAPA framework. There is already a high expectation raised at community level
about the importance of this project and that it will address the needs of most climate
vulnerable people in project districts. This, however, has not matched with their expectation of
the actual implementation of the framework on ground. Good ownership exists by central level
GoN staff, both in Ministry of Environment and Ministry of Federal Affairs and Local
Development. During the review of the project, it was felt that there is a clear need for the
project staff including the UNDP project focal point, Deputy Project Manager and Senior
Climate Change Expert gear up their efforts to scale up project activities and fast delivery of
the project.
1.4 Summary of overall progress
Implementation of local adaptation plans has progressed well but the overall project progress
on capacity building is off-track. Given the high output weightage on LAPA implementation, the
project has been able to deliver results to date. After nearly 1.5 years of delays, LAPA
implementation on-the-ground has begun. Due to this delay, the project is under huge
pressure to deliver results in a limited time. This might impact the quality of results if resources
are not reallocated in monitoring project progress and capacity building. The pace of policy
work has been relatively successful with LAPA approach being adopted by other development
partners and internationally. The energy results, the formulation of low carbon economic
development strategy and access to clean energy by poor people are timely and of relatively
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good quality.
The project progress (LAPA implementation), however, has to be assessed in light of the
capacity building component of the project which is progressing at a much slower pace.
Without significant improvement of this component, all other project components will be at high
risk of delivery. Considering that the project has produced its intended results to date despite
delays and difficulties and still offers a good value for money, an output score “A” is justified.
For the project to sustain its progress further, this year the “Project Improvement Plan” will
have to be implemented under close supervision and day to day monitoring of DFID lead
adviser.
1.5 Key challenges
The project has been able to gain wider international and national interest on LAPA framework
as an effective approach for implementing adaptation actions at local level. GoN’s ownership
and leadership were instrumental in achieving such a success. However, there are a number
of challenges for the project including:

A majority of staff have development background and hence the project team’s capacity
is currently being felt inadequate for planning and implementing climate specific
activities. This means a greater investment of DFID staff and time required to articulate
project design objectives all throughout the implementation.

UNDP TA was designed to provide support to GoN in technical and financial
management of the project. However, the TA has been delayed massively and need for
improvements in its technical, management and communication capacity.

Political instability and frequent changes at senior GoN staff still poses challenges to
the smooth implementation of the project. Constituent Assembly elections of November
2013 and the subsequent changes this may bring in GoN bureaucracy poses high risk
for timely project delivery.

All project sites are located in very remote mountains; in some sites snowfall and
extreme weather conditions did not allow implementation of any project activities for 3-6
months. Furthermore, GoN and project staff retention in those districts have been very
difficult due to remoteness and expensive living costs.

Ministry of Science, Technology and Environment is already overloaded with huge
climate projects. Their capacity both for policy and implementation coordination is
extremely limited.
1.6 Annual Outcome Assessment
Delivery of results has suffered due to delays in establishing UNDP TA as it was envisaged as
the primary support mechanism for the GoN staff for whom NCCSP is the biggest (in terms of
funds) project and its approach still new to project staff. Outputs 1 and 4 have relatively been
on track where significant time and additional funds have been put in by DFID in planning,
coordination and communication to fast track activities. Additionally, energy results have also
helped to keep these outputs on track.
The project is currently gearing up to perform but will still need significant time input by DFID
advisers and a close monitoring of UNDP TA coming up to the performance mark. The output
rating could be justified an A but the project will still need to continue implementation of
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“Project Improvement Plan” of last year.
2. Costs and timescale
2.1 Is the project on-track against financial forecasts: N
Project implementation has been delayed but towards the end of this year disbursement was
been made against the forecast following GoN’s submission of project delivery plan and
commitment to fast track implementation.
2.2 Key cost drivers
The main cost components are the delivery of adaptation support to climate vulnerable
communities in the form of awareness raising and climate proofing of small-scale
infrastructure works, training and establishing early warning systems. 80% of the budget is
allocated to these activities. Costs for these activities are likely to be relatively high due to the
remoteness of the project districts. The remainder of the project funds will be used for capacity
building activities, though a contract with UNDP.
DFID has put additional funds to hire a Senior Finance Management Expert who will help GoN
staff in capacity building and establishing financial management system and procedure for the
project. DFID has also provided additional funds to plan additional LAPAs in the existing
districts.
Since additional resources have been provided to the project, a review of UNDP TA
effectiveness and the value for money assessment of DFID support is recommended towards
the end of next year.
2.3 Is the project on-track against original timescale: N
The project has been delayed by a year compared to its original timescale. Only 25% of the
forecast DRF and ICF results could be reported this year. LAPA results, implementation and
energy results are on track.
3. Evidence and Evaluation
3.1 Assess any changes in evidence and implications for the project
Local level adaptation support is a new and evolving area. As such the evidence base is
shifting from one of using past evidence of similar community interventions to gathering initial
pilot evidence to inform programming. NCCSP is no different having been designed using the
evidence from the preceding Community Adaptation Design and Pilot programme to develop
workable systems for local climate change adaptation planning (the LAPA). These approaches
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are now being implemented through the project and will inform and be informed by further
evidence from other similar local level adaptation support programmes in Nepal and around
the world.
A review of M&E framework and results in November 2013 by DFID Statistics adviser
appreciated the attempts made by DFID staff in collecting and quality assuring project results
despite unavailability of good data received from the project. His report suggested that
NCCSP data and indicators are of average quality.
3.2 Where an evaluation is planned what progress has been made?
A baseline survey (including control VDCs in neighbouring Districts) has been completed and
this has fed into project’s monitoring and evaluation strategy. NCCSP is one of the eight GoN
projects included into Ministry of Environment’s wider Project Monitoring Committee.
A joint mid-term project monitoring and evaluation is planned for next year. This will be a
process evaluation whereby approaches, system and structures for climate planning and
implementation as taken by the project will be evaluated against the intended objectives of the
project.
A review of GoN capacity and effectiveness of UNDP TA is recommended towards the end of
next year.
4. Risk
4.1 Output Risk Rating: Medium
4.2 Assessment of the risk level
The risk rating remains medium. The project was designed to manage the main
implementation risks effectively e.g. the provision of UNDP TA at the District and central level
to build capacity and support implementation by weak government agencies. The importance
of UNDP to ensure continued project operations and safeguard funds is critical if risks are to
be managed well.
4.3 Risk of funds not being used as intended
Funds will be closely managed by the UNDP TA supporting implementation. The detailed FRA
work was undertaken just after the project approval. DFID has provided additional resources
to hire a Senior Finance Management Expert who will be stationed at the Ministry with project
staff. The expert will help in establishing finance management procedures and implementation
guideline for the project. This will also ensure additional safeguard measures to ensure that
funds are used for the intended purposes and mechanisms are in place at the District and
VDC level.
4.4 Climate and Environment Risk
The project is specifically designed to reduce climate and environmental risks in a particularly
climate vulnerable area. Consequently the overall risk and opportunity rating remain high for
the programme.
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5. Value for Money
5.1 Performance on VfM measures
The programme follows Climate Change Policy of 20-80% split of budget for institutional
capacity building and implementation of local adaptation actions. This approach is an example
of increasing VFM by ensuring maximum flow of budget at local level to deliver results,
particularly implementing climate adaption actions for vulnerable people. In addition the
programme has agreed to develop and use national capacity through use of UNDP technical
assistance. Due to project delays concern, DFID has provided additional resources to fast
track the programme. Additional fund were kept at minimum but the resultant benefits were
tremendous in terms of results delivery and fast tracking of implementation.
A VfM specific assessment of the project – for both project results and TA support is
recommended towards the end of next year.
5.2 Commercial Improvement and Value for Money
The project has provisions for implementing LAPAs by national NGOs and local level GoN line
agencies. A first round competitive tender for service providers called by GoN in November
2012 was cancelled by the GoN citing that UNDP TA which as nearing approval would be best
placed to manage such large scale procurement process.
Currently, UNDP TA is making preparation for procurement of services for capacity building
and LAPA implementation. The UNDP procurement processes are slow but are expected to
deliver good value for money through a well-managed competitive process.
5.3 Role of project partners
The start-up phase has clarified the roles of the project partners. The Ministry of Environment
is the lead government agency responsible for implementation in close co-ordination with the
Ministry of Local Development and with UNDP providing implementation support. This
arrangement will be mirrored at the District level with District Energy, Environment and Climate
Change Units being supported by UNDP TA to deliver LAPA projects. The EU remains a
supportive partner which has been providing additional technical assistance to the project at
times of need.
5.4 Does the project still represent Value for Money : Y
5.5 If not, what action will you take?
Not applicable
6. Conditionality
6.1 Update on specific conditions
The project scored B in its last review and hence DFID has kept a close watch on the project
progress and delivery of results. An internal project improvement plan is in place and DFID
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monitors the project on day to day basis.
7. Conclusions and actions
The project is now expected to progress well on the ground with all staff recruitment
completed and refined operational modalities in place. This is also expected to meet the
expectation of both national and international audiences who have been watching LAPA
project with much interest that this can be replicated elsewhere.
As UNDP TA is critical to the project progress, it must make significant improvements in its
own communication and management capacity of the project. Without such improvement,
GoN and NGO capacity will be remote.
GoN will need to critically review staff time input into this project and the achievement of
results as a majority of future climate projects within the Ministry of Environment depends
largely on the performance and success of approaches of this project.
DFID and EU will need to keep a close watch on the project progress and to ensure the
project is being implemented to meet the design objectives and Quality Assure results.
A few critical areas of action for the project are:
 Project Steering Committee meeting to be held at the soonest. It has been more than a
year that the Committee has not met
 DFID lead adviser to monitor the implementation of Project Improvement Plan on day to
day basis. This will need an initial agreement with GoN and UNDP TA that this will
become a benchmark for assessing project progress and the modality of future
investment in climate change.
 UNDP TA capacity enhancement at centre and in districts so to ensure adequate
support is being provided to GoN on policy coordination and ground implementation
 Encourage better UNDP internal coordination on DRR and Climate activities
 Agreement on and fast tracking of LAPA implementation on ground by national NGOs
 DFID to review project results for possibility of buying additional energy and jobs results
8. Review Process
The annual review was based on a field visit to project districts at various occasions. NCCSP
inception report, Nepal Rural Renewable Energy Project progress report and LAPA
formulation reports were reviewed.
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