REQUEST FOR PROJECT PREPARATION GRANT (PPG)
PROJECT TYPE: FULL-SIZED PROJECT
THE GEF TRUST FUND
Submission date: 02/02/2011
Re-submission date: 09/12/2011
Re-submission date: 11/29/11
GEF PROJECT ID1: 4377
GEF AGENCY PROJECT ID: 2921
COUNTRY(IES): Ukraine
PROJECT TITLE: Development and Commercialization of Bioenergy Technologies in the Municipal
Sector in Ukraine
GEF AGENCY(IES): UNDP,
OTHER EXECUTING PARTNER(S): Ministry of Agricultural Policy , Ministry of Environmental Protection
of Ukraine, Regional Administration of Ivanofrankivsk, Regional Administration of Cherkasy, National
Environment Investment Agency, Project Developers of biomass projects
GEF FOCAL AREA(s): Climate Change
GEF-5 STRATEGIC PROGRAM(s): CC-SP-Technology Transfer/CC-SP-4
NAME OF PARENT/PROGRAM/UMBRELLA PROJECT (if applicable): N/A
A. PROJECT PREPARATION TIMEFRAME
Start date of PPG
Completion date of PPG
B. PAST PROJECT PREPARATION ACTIVITIES ($)
01/01/12
30/06/13
N/A
C. PROPOSED PROJECT PREPARATION ACTIVITIES ($)
Describe the PPG activities and justifications: The work involved in the design and development
of the full size project Development and Commercialization of Bioenergy Technologies in the
Municipal Sector in Ukraine project includes collecting additional data, establishing the Biomass
Support Unit within the Ministry of Agricultural Policy, establishing in more detail the institutional
set-up of the project, and designing and implementing the Biomass Project Ideas Competition and the
Investment Grant Mechanism, and then preparing the detailed project documentation for a full
submission to GEF. The work will be carried out by the Ministry of Agricultural Policy as the
Implementing Agency of the project and in coordination with all relevant national and local
authorities in particular the Ministry of Environmental Protection of Ukraine, Bioenergy SMEs and
Regional Administrations of Ivanofrankivsk and Cherkasy.
1. Collection of additional data
Baseline and market structure data has been collected during the preparation of the PIF, but
additional data is needed to fully design the project in the most appropriate and cost-effective
manner.
1.1 Review of ongoing and planned activities in the municipal Sector related to biomass and
preparation of Municipal Biomass Guide
1
Project ID number will be assigned by GEFSEC. If PIF has already been submitted, please use the same ID number as PIF.
2921 - Ukraine Bioenergy - PPG-November-2011
1
An in-depth review of all biomass related activities (both ongoing and planned) in Ukraine related to
the municipal sector will be undertaken. The purpose of this review will be to clearly identify and
define the specific barriers which are preventing is preventing the utilization of biomass from
becoming more widespread in the municipal sector. This relates to biomass for electricity generation,
biomass for heating, and biomass for cogeneration. The output of this review will be a Municipal
Biomass Guide for Ukraine which will assist with the design of the full project. The Guide will
outline in details all the barriers to the greater use of biomass in the municipal sector in Ukraine and
will provide as a building block for the development and adoption of specific municipal biomass
programmes once the full project is under implementation.
1.2 Stakeholder Consultations and work towards the establishment of Biomass Support Unit within
Ministry of Agricultural Policy
Stakeholders have been consulted in preparation of the PIF of this project and at least 10
municipalities have indicated interest to working with UNDP on technical assistance projects over
the past two years including Lviv, Ivanofrankivsk, Uzhgorod, Kharkov, Zaparozhe, Lugansk,
Yalta/Alushta, Nikolaev, Rivne, Sumy, and Cherkasy. Based on meetings and follow-up discussions,
the UNDP Country Office decided to select Ivanofrankivsk and Cherkasy Regional Administrations
as the pilot regional administrations to develop the UNDP GEF Municipal Biomass Programmes.
UNDP reserves the right to change these municipalities during the PPG phase if the co-financing
commitments from the municipalities are not formally confirmed. Please note that other regions will
also be covered too because part of the PIF activity will be to ensure the commitment of Government
resources to develop a National Biomass programme for Municipalities which will expand the pilot
activities and investment grants beyond only two municipalities. While GEF support initially targets
only two municipalities, other municipalities will also in time be covered and included. The output
of this work will be three completed seminars (one in Kiev one in Ivanofrankivsk, one in Cherkasy)
prepared by the national consultants hired for this task, including seminar reports outlining who all
the potential stakeholders and biomass project ideas are and what their roles might be. Additional
seminars may also be conducted in additional municipalities as selected by the Government for the
additional municipal biomass programmes. The expected number of additional municipalities to be
selected by the Government is six. The seminar in Kiev will aim to define in more detail the baseline
project and the incremental activities to be undertaken by the project. A logical framework analysis
(LFA) will be carried out with the project proponents, stakeholders and potential partners to define,
and agree by consensus on, the project planning matrix (log frame) or Results Framework, which
will be finalized by the end of the PPG. The seminars in Ivanofrankivsk and Cherkasy will present
the project approach to key project stakeholders and outline the proposed Biomass project ideas
competition so that shortly after these seminars the Biomass project ideas competition can be
launched. Following the seminars, it is envisaged that the Ministry of Agricultural Policy will be able
to establish a Biomass Support Unit which will have a main aim to support the development of a
National Programme on Biomass which will encompass all of Ukraine. It is envisaged that the terms
of reference for the biomass support unit will be agreed and defined during the PPG phase but the
unit will not start fully operating until the full project is approved.
1.3 Formal appointment of Ministry of Agricultural Policy as lead agency for Biomass Energy in
Ukraine and commitment of co-financing and formal establishment of Biomass Support Unit.
Government decree to formally appoint the Ministry of Agricultural Policy as the lead agency to
promote Biomass Energy in Ukraine, agreement and resolution concerning the establishment of the
Biomass Support Unit, commit Government resources for both the Investment Grant Mechanism and
the National Programme on Biomass to Support Municipal Biomass projects. Additional
municipalities (beyond the two selected for GEF support) will be selected by the Government at the
2921 - Ukraine Bioenergy - PPG-November-2011
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time that the Biomass Support Units is established. The project will work with more than two pilot
municipalities (number to be determined during PPG phase but most likely to be 6 additional
municipalities) not including the two will be supported by GEF and the rest by the Government
which would make 8 municipalities in total. As part of this activity, a fully developed analytical
scheme of coordination between all the different stakeholders being involved in the development and
financing of municipal biomass energy projects (i.e. Ministry of Agricultural Policy, Ministry of
Environmental Protection, National Electricity Regulatory Commission, etc.);
1.4 Biomass Project Ideas Competition and the Investment Grant Mechanism
It is recognized that one way to stimulate 'entrepreneurship' and to encourage municipal biomass
projects in Ukraine to be developed in such a way as to select those projects which offer promising
approaches and new technologies but lack equity in order to successfully secure the full project
financing. Therefore, we propose to undertake a Biomass project ideas competition which will be
run and administered by the Ministry of Agricultural Policy with support from UNDP who will be
responsible for the establishment and execution of the Investment Grant Mechanism. The Biomass
Project Ideas competition will be designed in such a way as to select projects in all of the
municipalities selected as part of the PPG activities. This includes the municipalities where UNDP
will develop the municipal biomass programmes and the municipalities where Government will take
the lead role.
1.4.1. International Consultant to Design Procedures for Investment Grant Mechanism
Working closely with the Ministry of Agricultural Policy, an international consultant will prepare
detailed terms of reference will be prepared for selecting project partners for municipal biomass
projects in Ukraine to be administered by the Ministry of Agricultural Policy. These procedures will
be similar for municipalities where UNDP GEF will take the lead role and those where the
Government will take the lead role. All selected projects must have a linkage to providing biomass /
biogas for the two selected municipalities and the Investment Grant should not in any case exceed
25% of the total capital cost of any given project. Both biomass power and heating projects will be
considered. Each project should involve a public-private partnership meaning that both a regional
administration and a private company shall have an economic stake in the success of the project.
Projects which only involve municipalities without a private sector partner shall not be considered. In
addition, the selected projects should not be financed under the EBRD GEF renewable energy project
in Ukraine. The selected projects will be detailed in the annex of the project document which
includes those in all the municipalities in which the project will work.
1.4.2. Organization of Biomass Project Ideas Competition (BPIC) as Part of the PPG
A standard format for submitting biomass project ideas will be prepared by the International
Technical Consultant on Biomass. A 'Biomass Project Ideas Competition' tender will then be
organized by the Ministry of Agricultural Policy with assistance from UNDP and the winning project
ideas will be eligible to receive an Investment Grant once the full project is underway in accordance
with the design procedures for the Investment Grant Mechanism. Each project must be linked to the
selected municipalities (Ivanofrankisvk and Cherkasy) and additional municipalities selected by the
Ministry of Agricultural Policy and should involve public-private partnerships.
1.3.3. Selection of pilot/demonstration projects
The project aims at developing biomass projects in the municipal sector in Ukraine focused on pilot
projects in the Ivanofrankivsk region and the Cherkasy region. In addition, it is envisaged that similar
activities will be carried out in 6 additional municipalities with the support of the Government. It is
envisaged there will at least six selected projects with investment grants of us$500,000 each and each
selected project must therefore have some linkage to the municipal biomass programmes and involve
a public-private partnership meaning that there are both municipal and private clients with a stake in
2921 - Ukraine Bioenergy - PPG-November-2011
3
the success of the selected projects. All details about the 10 selected projects will be provided in
annexes to the full project document including results of pre-feasibility analyses.
1.4 Design and Preparation of Project Document and Request for CEO Endorsement
Based on the activities described above, the project strategy will be able to be further designed.
Detailed planning of the full project will be completed as part of this activity. Collaboration with
other GEF bioenergy projects and ongoing initiatives in Ukraine (in particular the UNIDO biomass
project with SMEs) will be ensured in particular when designing project strategies and defining
project scope and activities. The PPG activities will include:
-
-
Preparation of the project planning matrix (log frame) or Results Framework
Formal appointment of the Ministry of Agricultural Policy as the lead agency on biomass energy
in Ukraine
An in-depth insight into the existing bioenergy policy framework and a fully developed
analytical scheme of coordination between all the different stakeholders being involved in the
development and financing of municipal biomass energy projects
Analysis of barriers and risks to development and commercialization of bioenergy technologies
focused on the two selected municipalities;
Set of concrete activities that constitute the most cost effective response to the identified barriers
within the two municipalities;
Preparation of municipal biomass guide
Determination of social, economic and financial sustainability of proposed project activities;
Cost analysis of expected project outcomes and outputs, preparation of co-financing sources and
co-financing commitments in compliance with the GEF incrementality principle;
Preparation of monitoring and evaluation plan, including a set of impact indicators to track the
project’s baseline and target values, progress and effectiveness;
Preparation of a cost-effectiveness analysis.
List of Proposed
Project Preparation
Activities
Output of the PPG Activities
Component 1

Municipal Biomass
Guide

Component 2


Stakeholder
Consultations ,
appointment of
Ministry of
Agricultural Policy,
and Establishment of
Biomass Support
Unit




Completed review of all ongoing
and planned activities related to
biomass in the municipal Sector
Preliminary Project Results
Framework
Municipal Biomass Guide
Documented results of
consultations with public and
private sector stakeholders
Completed Stakeholders Seminar in
Ivanofrankivsk
Completed Stakeholders Seminar in
Cherkasy
Documented Reports from both
Seminars
Agreed project planning matrix (log
2921 - Ukraine Bioenergy - PPG-November-2011
Project
Prepara
tion
Amount
(a)
Co-financing
(b)
21,000
21,000
42,000
16,000
51,000
67,000
Total
c=a+b
4



Component 3

Biomass Project
Ideas Competition
and Investment Grant
Mechanism

frame) or Results Framework
Government Decree to Formally
appoint Ministry of Agricultural
Policy as lead agency for Biomass
Energy in Ukraine
Agreed Terms of Reference for the
establishment of the Biomass
Support Unit within the Ministry of
Agricultural Policy and Operational
Budget to fund the unit once the
project starts
Fully developed analytical scheme
of coordination between all the
different stakeholders being
involved in the development and
financing of municipal biomass
energy projects
Investment Grant Mechanism
18,000
design
Biomass Project Ideas Competition
is carried out and at least 6
demonstration projects selected for
Investment Grants (GEF funded
projects
Documented information about the
6+ Selected Projects incorporated as
annexes into Project Document and
Request for CEO Endorsement
53,000
71,000
Detailed final project design
35,000
including estimated GHG reduction
Project Document
potential and implementation
and Request for CEO
arrangements prepared.
Endorsement
 Finalized Project Document, and
GEF Request for CEO Endorsement
and GEF Tracking Tool submitted
to GEF Secretariat
Total Project Preparation Financing
90,000
35,000
70,000
160,000
250,000

Component 4

D. FINANCING PLAN SUMMARY FOR PROJECT PREPARATION GRANT: ($)
Project Preparation
GEF financing
Co-financing
Total
$90,000
$160,000
$250,000
Agency Fee
$9,000
$9,000
E. PPG REQUESTED BY AGENCY(IES), FOCAL AREA(S) AND COUNTRY(IES) 1: N/A
2921 - Ukraine Bioenergy - PPG-November-2011
5
F. PPG BUDGET REQUEST
Total Estimated
Person Weeks for
GEF Grant (PW)
Cost Items
Local consultants *
International consultants*
Travel
Miscellaneous
62
15
Total PPG Budget
GEF ($)
Co-financing ($)
Total ($)
31,000
52,500
4,000
2,500
130,000
15,000
15,000
161,000
52,500
19,000
17,500
$90,000
$160,000
$250,000
*Annex A for Consultant cost details should be prepared first before completing this table. See notes on Annex A for the
required detailed information. This table is the sum of all local and international consultants presented in Annex A.
G. GEF AGENCY(IES) CERTIFICATION
This request has been prepared in accordance with GEF policies and procedures and meets the GEF
criteria for project identification and preparation.
Agency
Coordinator,
Agency name
Signature
Yannick
Glemarec,
Executive
Coordinator,
UNDP/GEF
2921 - Ukraine Bioenergy - PPG-November-2011
Date
(Month, day,
year)
Project
Contact
Person
29
November
2011
John
O’Brien,
Regional
Technical
Advisor
Telephone
+421 2
59337
413
Email Address
John.obrien@undp.org
6
Annex A
Consultants Financed by the Project Preparation Grant (PPG)
Bulk of the PPG (about 92%) will fund 3 national experts and 2 international experts. One of the national
experts will be full time (over 12 months) and the other two national expert and the two international
experts will be part-time.
Position /
Titles
$/
Person
Week1
Estimated
PWs2
500
46
Tasks to be performed
Local
National
Consultant 1 Senior
Bioenergy
Expert (fulltime position
for 12 months
with 6 weeks
annual leave)









National
Consultant 2 Project Design
and
Stakeholder
Expert
(Ivanofrankiv
sk and
Cherkasy)
500
16



2921 - Ukraine Bioenergy - PPG-November-2011
Coordination of the work of the local team and provide direct
liaison with the two international consultants working with the
UNDP CO and the UNDP RTA.
Government Decree to Appoint Ministry of Agricultural Policy
as Lead Agency for Biomass Energy in Ukraine
Assistance with Establishment of Biomass Support Unit within
the Ministry of Agricultural Policy
Provision of information for assistance with preparation of the
Municipal Biomass Guide (Report 1) including commenting on
all drafts of the report
Overall coordination of all stakeholder meetings and
organization of the Stakeholder Consultation Seminar in Kiev
Work with the international consultants and the UNDP CO and
RTA to design the 'Biomass Project Ideas Competition'
Support the process for developing and implementing the
Investment Grant Mechanism including due diligence but not
participating on the panel to select project partners and
stakeholders
Provision of information to assist in the preparation of the
stakeholder reports (Report 2), project document (Report 3)
and request for CEO endorsement (Report 4)
Preparation of Quarterly Progress Reports to the Project Team
and the Regional Technical Advisor and UNDP CO
Organization and conduct of both the stakeholder consultation
meetings in Ivanofrankivsk and Cherkasy
Identification of potential project partners / stakeholders in
Ivanofrankivsk region and meet with them to discuss their
potential involvement in the project and to encourage them to
enter into the Biomass Project Ideas Competition
Preparation of Report from both Stakeholders Seminars
outlining what has been agreed at the seminars (Report 2)
7
International
International
Consultant 1
- International
Project
Development
Expert on
Bioenergy
3500
10








International
Consultant 2
- International
Technical
Expert on
Biomass
Energy
3500
5




Preparation of the Municipal Biomass Guide (Report 1).
Participation in the 3 Stakeholder Consultation Meetings in
Kiev, Ivanofrankivsk and Cherkasy
Preparation of the project’s Project Results Framework with a
set of measurable impact and progress indicators based on the
results of the logical framework analysis.
Development of the criteria for 'Biomass Project Ideas
Competition' under Component 3
Ensure that the sustainability and replication component is a
strong part of the project outcomes and has a heavy emphasis in
the project document
Preparation of the Project Results Framework (RF) for
incorporation into the project document
Preparation and finalization of the Project Document and
Request for CEO endorsement and GEF Tracking Tool
using inputs from local experts and revise following comments
from GEF Sec.
It is envisaged that 3 missions to Ukraine will be required by
this consultant.
Participation in the three stakeholder Consultation meetings and
based on this prepare a detailed terms of reference for the
Investment Grant Mechanism and the Biomass Project Ideas
Competition as well as the format for all projects entering into
the Biomass Project Ideas Competition
Performance of due diligence on all selected projects and assist
in reviewing all project applicants to the grant mechanism and
participate as panel member for selection of projects.
Provision of comments and review to improve the quality of the
project document and request for CEO endorsement working
with International Project Development Expert on Bioenergy.
It is envisaged that 2 missions to Ukraine will be required by
this consultant.
1Provide
dollar amount per person week International Experts calculated at us$700/day and national expert at $100/day for the senior
bioenergy expert and $100/day for the Project Design and Stakeholder Expert.
2 Provide person weeks needed to carry out the task and corresponds to the dollar amount per person week in the previous column.
2921 - Ukraine Bioenergy - PPG-November-2011
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