The Feasibility of National Climate Fund
A Case of Indonesia Climate Change Trust Fund
Amin Budiarjo
National Project Manager PREP-ICCTF
Regional Clinic on the Design and Management of National Climate Funds
Bangkok, 6 September 2012
ICCTF Secretariat
Wisma Bakrie 2 Building, 6th floor
Jl. H.R. Rasuna Said Kav. B-2, Jakarta 12920, Indonesia
Phone: +62 21 57945760, Fax: +62 21 57945759
Email: secretariat@icctf.or.id, Web: www.icctf.or.id
Structure of Presentation
1. Fund at a Glance
2. Rationale behind the Establishment
3. Process of Establishment
4. Lessons Learned
www.icctf.or.id
Fund at a Glance
Indonesia Climate Change Trust Fund (ICCTF),
Indonesia
• Objective:
1. To achieve Indonesia’s goals of a low carbon economy
and greater resilience to climate change;
2. To enable the Government of Indonesia (GoI) to increase
the effectiveness and impact of its leadership and
management in addressing climate change issues.
• Governing body: Steering Committee, Technical Committee,
Secretariat, Fund Manager
• Legal status: government trust fund (ministerial decree)
• Capital: USD 11.2 million (2010-current)
• Beneficiaries: central government (Executing Agency);
central and local government, universities, CSO, NGO, private
sector (Implementing Agency)
www.icctf.or.id
Fund at a Glance
Current Structure and Work Flow
Steering Committee
Plenary Members
Observer/
Resources Person
GOI Members
(Chairman and
Vice Chairman
from Bappenas)
Legend :
Monitoring and
Supervision
Project
Proposal
Approval and
Assignment
Fund
Channeling
Technical Committee
GOI Members
(Chair& Co-Chairs from Bappenas &
Ministry of Finance)
Representatives of Plenary Members
ICCTF Secretariat
Executing Agency (Central Govt. Agency)
/Implementing Agency (Govt. Agency,
University, CSO/NGO, Private Sector)
Fund Management
National Fund
Manager
UNDP as Interim
Fund Manager
www.icctf.or.id
Rationale behind the Establishment
National Background
• Vulnerability to the negative impacts of climate change
• Though Indonesia is not mandatory for GHG emission reduction, climate
change is a reality and urgent actions on adaptation and mitigation is
required as an integral part of the development challenge facing the nation
• Mitigation and adaptation actions have to be taken jointly by all countries.
Indonesia is ready to cooperate both bilaterally and multilaterally with
international efforts.
International Background
• UNFCC 1992, Article 3.4 incorporate climate change into national
development planning; Article 4.1 underlines the needs of all countries to
develop specific national development priorities and objectives accordance
to principles of common but differentiated responsibilities
• Kyoto Protocol to UNFCCC 1998 states emission reduction is binding for
developed countries.
• Bali Action Plan 2007 includes the request for developed countries to
contribute to mitigation of global warming in the sustainable development
context and envisages enhanced actions on adaptation, technology
development and on the provision financial resources and measures against
deforestation
www.icctf.or.id
Rationale behind the Establishment
National Action Plan on GHG Emission Reduction (RAN-GRK)
President’s Commitment at G-20 Pittsburgh and COP15
Reducing green house gas emission by 2020
26%
GoI efforts
(Unilateral NAMAs)
26+15=41%
GoI efforts and
International supports
(Supported NAMAs)
Presidential Regulation No.61/2011 Regarding National Action
Plan on GHG Emissions Reduction (RAN-GRK)
Sectors: Agriculture, Forestry & Peatland, Industry, Energy &
Transportation, Waste
www.icctf.or.id
Rationale behind the Establishment
Mainstreaming Climate Change into National Development Agenda
Mitigation
BALI ACTION
PLAN
PRESIDENT’S
STATEMENT at
G-20, 2009
ROADMAP
(ICCSR)
Bridges National Action Plan on CC
into 5 yr mid-term development plan
(RPJM) 2010-2014 & inputs till 2030.
GoI’s own budget
Mainstrea
ming into
RPJM
Bi-/Multilateral
cooperation
RAN - GRK
Adapta
-tion
Yellow
Book
ICCTF
ICCTF- International
financing mechanism
channeling investment
funds into national CC
initiatives.
www.icctf.or.id
Policy Documents on Climate Change (1)
Policy
Content
Long-Term Development Plan
(RPJPN) 2005-2025
In order to achieve the vision of sustainable development, the GoI concluded
that "the long term sustainability of development will face the challenges of
climate change and global warming which affect activities and livelihood".
National Action Plan on Climate
Change (RAN-MAPI), 2007
Initial guidance for a multi-sectoral coordination effort designed to address
jointly the challenges of mitigation and adaptation to climate change
National Development Planning:
Indonesian Responses to
Climate Change (Yellow Book),
2007-2010
It was intended to strengthen and reinforce the RPJMN (National Medium-Term
Development Plan) 2004-2009 as well as to include inputs that can guide the
integration of considerations of climate change into the preparation of RPJMN
2010-2014
Medium-Term Development
Plan (RPJMN) 2010-2014
It emphasizes 11 national priorities, which 3 of them (food security, energy, and
environment and disaster management) are strongly related to climate change.
Indonesia Climate Change
Sectoral Roadmap (ICCSR), 2010
A roadmap to serve as a detailed policy guidance and in order to mainstream
climate change issues into national development planning.
Presidential Regulation
No.61/2011 regarding National
Action Plan on GHG Emission
Reduction (RAN-GRK), 2011
National action plan for mitigation to achieve the national targets of emission
reduction (-26% and -41% of the BAU scenario until 2020). It contains policy
directions and actions for mitigation in 5 sectors and constitutes important
guidance for channeling financial flows into national and local mitigation
programs.
 Local Action Plan on GHG Emission Reduction at provincial level
www.icctf.or.id
Policy Documents on Climate Change (2)
Policy
Content
Presidential Regulation
No.71/2011 regarding National
GHG Inventory System, 2011
Regular information on the level, status and trend of GHG emission change and
absorption, including national, and subnational carbon stock as well as GHG
emission reduction.
Presidential Instruction No.
10/2011 on Forest Moratorium,
2011
Development of REDD+ schemes including Indicative Moratorium maps
Presidential Decree No. 25/2011
on National Task Force for
REDD+, 2011
REDD+ agency and related institutional development (finance and MRV)
In addition to that, also Government regulation on trust fund
Presidential Regulation
No.80/2011 regarding Trust
Fund, 2011
Establishment, structure and operation of a trust fund
www.icctf.or.id
Funding Scheme for Climate Change
Sources:
Global Financing Mechanism
Bilateral:
1. ODA*) Rules and Regulations:
Japan (JBIC & JICA)
England (DFID)
Australia (AusAID)
Denmark (DANIDA)
Netherlands
German (Kfw & Gtz)
Norway
Canada (CIDA)
Sweden (SIDA)
Bilateral
Multilateral
Grant
2. UNFCCC Financing Mechanism:
GEF (Convention):
Special Climate Change Fund (SCCF)
CDM:
Bilateral, Multilateral &
Unilateral
Loan:
1. Sector/ Project Loan
2. Program Loan
Multilateral:
World Bank
ADB
UNDP
EC
GOI Mechanisms**)
Adaptation Fund (Protocol)
OTHERS: GEF (Non-Convention):
Strategic Priority on Adaptation (SPA)
Resource Allocation Framework (RAF)
CC (Local) Trust Fund
Debt for Nature Swap
Notes:
*): expected come from additional existing ODA comittment from Monterey Concensus (ODA+)
**): comply with Government Regulation No.2/2006
www.icctf.or.id
: Climate Change Program Loan
Process of Establishment
Milestone
• Vision of GoI to play bigger role in coordinating & implementing all
climate change activities in Indonesia (2008)
• Bottom up initiatives agreed among GoI institutions to setup a
national trust fund for climate change (2008)
• Develop Blue print of ICCTF (2009)
• Establish decree of ministerial decree on ICCTF establishment (2009)
• Grant Agreement with donor, LoA & Prodoc on PREP-ICCTF (2009)
• Establish ICCTF Secretariat, develop and operationalize SOP (2010)
Resources and Support
• Political support: President’s commitment on GHG emission
reduction and consensus from all line ministries
• Champion: Ministry of National Development Planning and Ministry
of Finance, involving around 10 officials from both ministries
• Resources allocated: USD 250,000 for Blue print development (by
EU Grant - GIZ); and counterpart budget and in-kind contribution
from GoI
www.icctf.or.id
Required Institutional Capacity
Institutional Arrangement
• Management: organizational development, resource mobilization,
system development & operation, project management
Operation
• Finance: financial management & accounting
• Administration: administration & HR
• Monitoring & Evaluation: M&E in project planning, implementation,
and impact assessment
• Communication: external & internal communication, IT, database
• Audit: External & Internal Audit
Technical Substance
• Thematic expertise in priority areas: policy dialogue, project
appraisal, project implementation, impact assessment
www.icctf.or.id
Lessons Learned (2010-2012)
Achievements
Challenges
Success
Factor
•
•
•
•
Establishment of Secretariat and fully functioning financing institution.
Climate change policy dialogue and coordination forum.
Selection, funding, monitoring and evaluation of 3 pilot projects.
Development of Business Plan and investment strategy including priority
programs, proposed activities and budget plan.
• Assessment and application to be the NIE of Adaptation Fund
• Model in development of Presidential Regulation on Trust Fund.
• Administered under the Ministry of National Development Planning
• Capacity of project implementer (Executing Agency, Implementing
Agency & Project Management Unit) to adapt to a new project
management system and to comply with robust M&E system in project
implementation.
• Comprehensive assessment during project selection process
• Limited involvement of CSOs in policy dialogue.
• Accelerated growth of responsibilities and staffing
• Support to GoI activities (RAN/RAD-GRK, UNFCCC COP/CMP)
• GoI commitments and policies related to climate change and trust fund
• Support (fund contribution & TA) from development partners
• Established by the Ministry of National Development Planning and Ministry
of Finance
• Support from line ministries at central government during operation
www.icctf.or.id
Way Forward
2011 - 2013
Transition to fully
National Trust Fund
arrangement
2013 - 2015
Involvement of wider
stakeholders in project
implementation
2011 - 2020
Assessment to be NIE of
International Climate Fund
(AF, GCF)
2011 - 2013
Improvement of institutional capacity
www.icctf.or.id