with United Nations Industrial Development Organization (UNIDO) · 2020. 11. 26. · +43 1 26026 3850 +43 1 26026 3983 . [email protected]. [email protected] United Nations Industrial

with United Nations Industrial Development Organization (UNIDO)

for Kingdom of Cambodia

25 December 2019 | Strategic Frameworks

Programme title: Technology needs assessment and action plans to support climate-friendly technology implementation for Cambodia’s special economic zones in the Sihanoukville province.

Country: Cambodia

National designated authority: Ministry of Environment

Implementing Institution: United Nations Industrial Development Organization

Date of first submission: 31 August 2019

Date of current submission / version number

3 December 2019 V.3

Readiness and Preparatory Support Page 2 of 28

How to complete this document?

- Please visit the Empowering Countries page of the GCF website to download the Readiness Guidebook and learn how to access funding under the GCF Readiness and Preparatory Support Programme.

- This document should be completed by National Designated Authorities (NDA) or focal points with support from their Delivery Partners where relevant. Once completed, this document should be submitted to the GCF by the NDA or focal point to [email protected].

- Please be concise. If you need to include any additional information, please attach it to the proposal. - If the Delivery Partner implementing the Readiness support is not a GCF Accredited Entity for project

Funding Proposals, please complete the Financial Management Capacity Assessment (FMCA) questionnaire and submit it prior to or with this Readiness proposal. The FMCA is available for download at the Library page of the GCF website.

Where to get support?

- If you are not sure how to complete this document, or require support, please send an e-mail to [email protected].

- You can also complete as much of this document as you can and then send it to [email protected], copying both the Readiness Delivery Partner and the relevant GCF Country Dialogue Specialist and Regional Advisor. Please refer to the Country Profiles page of the GCF website to identify the relevant GCF Country Dialogue Specialist and Regional Advisor.

- We will get back to you within five (5) working days to acknowledge receipt of your submission and discuss the way forward.

Please submit the completed form to: [email protected]

Please use the following naming convention for the file name:

“GCF Readiness Proposal-[Country]-[yymmdd]”

Note: Environmental and Social Safeguards and Gender Throughout this document, when answering questions and providing details, please make sure to pay special attention to environmental, social and gender issues, particularly to the situation of vulnerable populations, including women and men. Please be specific about proposed actions to address these issues. Consult Annex IV of the Readiness Guidebook for more information.

https://www.greenclimate.fund/how-we-work/empowering-countriesmailto:[email protected]://www.greenclimate.fund/library/-/docs/list/574044mailto:[email protected]:[email protected]://www.greenclimate.fund/countriesmailto:[email protected]


1. SUMMARY

Country submitting the proposal

Country name: Cambodia

Name of institution representing NDA: Ministry of Environment

Name of Focal Point: Name of contact person:

Mr. Say Samal Mr. Sum Thy

Contact person’s position:

Director, Climate Change Department, Ministry of Environment (MOE)/General Secretariat of the National Council for Sustainable Development

Telephone number: +855 23 218370, +855 16 907764

Email: [email protected]

Full office address:

Ministry of Environment (MoE), Morodok Techo Building, Lot 503, Sangkat Tonle Bassac, Khan Chamkarmon, Phnom Penh, Cambodia

Date of initial submission 31 August 2019

Last date of resubmission 3 December 2019 Version number V.3

Which institution will implement the Readiness and Preparatory Support project?

☐ National designated authority ☐ Accredited entity ☒ Delivery partner

Name of institution: United Nations Industrial Development Organization

Name of official: Mr. Philippe R. Scholtès

Position:

Managing Director Programme Development and Technical Cooperation

Telephone number: +43 1 26026 3101

Email: [email protected]

Full office address:

D1901 United Nations Industrial Development Organization Headquarters Vienna International Centre Wagramerstrasse 5 A-1400 Vienna


Additional email addresses: UNIDO GCF Coordination [email protected] Ms. Alla Metelitsa Ms. Cassandra Pillay Chief Climate Change Expert +43 1 26026 3850 +43 1 26026 3983 [email protected] [email protected] United Nations Industrial Development Organization Climate Policy and Partnerships Division, Department of Energy, Directorate of Programme Development and Technical Cooperation

Title of the Readiness support proposal

Technology needs assessment and action plans to support climate-friendly technology implementation for Cambodia’s special economic zones in the Sihanoukville province.

Type of Readiness support sought

☐ I. Country capacity for engagement with GCF ☒ II. Country programming process ☐ III. Direct access to climate finance ☐ IV. Climate finance accessed ☐ V. Formulation of national adaptation planning and/or other adaptation planning

processes

Brief summary of the request

The Cambodian government in its Nationally Determined Contributions has planned to reduce greenhouse gas emissions from energy industries, manufacturing industries and transportation by 3.1 Mt CO2eq by the year 2030. To date, the government has begun implementing its Climate Change Strategic Plan 2014-2023, and has received GCF funding for capacity building relevant to climate friendly agribusiness value chains. It has further begun capacity building for sustainable industrial policymaking in partnership with UNIDO through The Programme for Country Partnership (2018-2023). While special economic zones (SEZs) have been identified as a principal sector for further development, a rapid increase in the number of construction projects linked to SEZs, especially in the Sihanoukville province, have led to national shortages in electricity supply and limited capacity to manage and treat municipal waste streams. These shortages (400 MW nationally) are currently being supplemented through the use of fossil-fuel based sources. This objective of this proposal is to provide a technology needs assessment and a series of technology action plans to support and guide a pipeline of projects aimed at de-carbonizing development linked to Sihanoukville’s SEZs. The direct beneficiaries of this proposal will be industrial businesses in Sihanoukville’s SEZs who will gain access to secure low-carbon electricity supply and the Cambodian government who is expected to achieve substantial local emissions reductions along with the transfer of nation-wide strategies for SEZ decarbonisation. Indirect beneficiaries will include the electric utility (increased investment in and promotion of low-carbon electricity generation), Sihanoukville electricity consumers (community members and marginalized groups to gain reliable electricity supply), and government agencies (capacity building for technology transfer and enhanced private sector engagement/collaboration). There exists a significant gap in engagement between the private sector in Sihanoukville’s SEZs and the electric utility and the relevant Cambodian government ministries, particularly in regard to the need to find solutions to electricity outages. The proposed proposal will address this gap by bringing together key stakeholders as part of a technology needs assessment committee to achieve a set of technology action plans for decarbonising Sihanoukville’s SEZ.

mailto:[email protected]:[email protected]:[email protected]


Total requested amount and currency USD $238,049 Anticipated duration 18 months

Has the country received or is expecting to receive other Readiness and Preparatory Support funding allocations (including adaptation planning) from GCF or other donors?

☒ Yes ☐ No Promoting Green Mobility through Electric Motorcycles in Cambodia (2019) • Delivery Partner: GGGI (Global Green Growth Institute) • Amount: US$ 204,673 (GCF-funded Readiness Support) • Delivery Period: Recently approved (15 months) • Description: The project aims to promote the shift from gasoline to electric

motorcycles by undertaking a thorough situation and market study, analyzing policy and regulatory gaps and designing a financing mechanism to promote deployment.

• Relation to proposed readiness support: The proposed project will build upon the coordination mechanisms and frameworks developed between the NDA and counterpart government ministries (i.e. Ministry of Public Works and Transport).

NDA Strengthening and Country Programming (2017) • Delivery Partner: NDA (Ministry of Environment for the Kingdom of Cambodia) • Amount: US$ 272,338 (GCF-funded Readiness Support) • Delivery Period: August 2016 – April 2018 (20 months) • Description: Identified key procedures and systems to implement into a national

engagement framework with the GCF, taking into account existing climate change policies and strategies.

• Relation to proposed readiness support: The strengthened institutional capacity of the NDA has enabled the undertaking of further readiness activities, such as GGGI’s proposal and UNIDO’s proposal herein.

Green Growth Policy Alignment and Investment Prioritization Within Cambodia’s National Strategic Development Plan in the period 2019-2023 (2017) • Delivery Partner: GGGI (Global Green Growth Institute) • Amount: US$ 1,485,000 (GGGI Core Funding) • Delivery Period: Ongoing (24 months) • Description: Green growth priority sectors are being identified through a

comprehensive situational analysis and translated into a domestic array of policies in line with Cambodia’s international climate change commitments.

• Relation to proposed readiness support: Maintaining close attention to policies focused on decarbonisation in the electricity sector or industrial SEZs will be of particular relevance to this proposal.

Readiness Gap Assessment (2016) • Delivery Partner: PwC • Amount: US$ 35,343 (GCF Readiness and Preparatory Support Programme) • Delivery Period: March - April 2016 (2 months) • Description: Institutional gaps were identified for the NDA and action plans

generated based on the gap assessments. • Relation to proposed readiness support: This supported the NDA Strengthening

and Country Programming proposal and further readiness activities/proposals.


2. BACKGROUND Overview The activities in this Readiness Proposal will support institutional capacity building and the development of a pipeline of projects geared towards the de-carbonization of Sihanoukville’s special economic zones (SEZs) in line with national emission reductions targets (3.1 Mt CO2eq reduction from the energy, manufacturing and transportation sectors by the year 2030). This proposal seeks:

- strengthening of institutional capacity through the establishment of a committee, project governing documents, an expanded coordination mechanism and a work plan for the execution of a SEZ-specific technology needs assessment;

- identification of critical gaps in existing national, regional and sectorial plans and policies relevant to sustainable technology implementation;

- prioritization of sectors, technologies, and appropriate actions for increased access to finance; - development of a series of technology action plans with associated investment plans and institutional

capacity to ensure timely execution of plan objectives; - engagement of the private sector through consultative processes; - sharing of knowledge between and development of synergies with existing capacity development and

project implementation efforts in Cambodia. Baseline

These activities build upon ministry/sector-specific action plans as outlined in Cambodia’s Climate Change Strategic Plan (CCCSP) 2014-2023, National Environment Strategy and Action Plan (NESAP) 2016-2023, National Energy Efficiency Policy (NEEP) 2018-2035, and National Strategic Development Plan (NSDP) 2019-2023. The NEEP and NSDP define the Government of Cambodia’s commitment to promoting energy efficiency improvement and conservation and mitigating adverse impacts of energy consumption and energy projects by developing a legal and regulatory framework for efficient management and use of resources in the energy sector. Moreover, Cambodia’s priority actions on low-carbon development are set by the National Council for Sustainable Development, established in 2015, which is mandated to coordinate and monitor the implementation of policies, strategies, regulations, plans and programmes in response to climate change issues. Furthermore, the organization and regulation of the energy sector in Cambodia follows the 2001 Electricity Law, and subsequent amendments of 2007 and 2015. The Electricity Law stipulates the separation of responsibilities between the two organizations governing the power sector, the Ministry of Mines and Energy and the Electricity Authority of Cambodia (greater details provided in Annex I). A multi-sector renewable energy policy is currently in development by the Ministry of Mines and Energy, targets and programmes for which have been recommended in the Cambodia Basic Energy Plan1. The activities in this proposal further complement ongoing and past capacity-building exercises as part of the NDA Strengthening and Country Programming, the GCF-funded Climate-Friendly Agribusiness Value Chains Sector Project, and the Cambodia Programme for Country Partnership the last two of which address national sustainable development priority sectors including SEZs, tourism and agro/creative industries. For more information on Cambodia’s SEZs within the context of climate change, please see Annex I. Collectively, this proposal aims to facilitate effective leveraging and mobilization of financial resources in ensuring Nationally Determined Contributions are met and strengthened over time, while leapfrogging potential future use of fossil fuels associated with a rapid rate of infrastructural development, and a growing local and expatriate population. Cambodia has had two previous Technology Needs Assessments (TNAs) completed in 2003 and 2013. The 2003 TNA developed recommendations for implementing integrated solid waste management policies and plans; this was to be achieved through educational campaigns, facilitating small enterprise private-public partnerships and conducting research activities on waste streams, near-urban farms and landfill sites. In the energy and industrial sectors, the 2003 TNA recommended efforts to focus on developing energy-efficient technologies for the most energy-intensive industries in Cambodia (agriculture, aluminum, chemicals, forest products, glass, metal casting, mining, petroleum and steel). The 2013 TNA focused on action plans in transport (urban mass transport and vehicle emissions standards) and energy efficiency (lighting and household appliances). Since 2013, there has been no detailed follow-up study on the implementation of the TNAs or Technology Action Plans (TAPs). However, the 2013 TNA was utilised to support GGGI’s Country Planning Framework (2016 - 2020) for Cambodia, wherein significant scope for improvements in industrial energy efficiency was suggested via mandatory standards and regulations for appliances. Moreover, the UNFCCC’s 2016 INDC Technology Synthesis Report recognized the contributions of the previous TNAs towards Cambodia’s sectorial climate change action plans and further expressed the need for a third TNA at the start of the INDC implementation phase.

1 Economic Research Institute for ASEAN and East Asia, Cambodia Basic Energy Plan 2019: http://www.eria.org/publications/cambodia-basic-energy-plan/

http://www.eria.org/publications/cambodia-basic-energy-plan/


Proposal Herein, the proposed TNA facilitates a means to build up a proposed pipeline of low-carbon technology solutions for maintaining reliable electricity supply for Sihanoukville’s SEZs. Such emission reduction technologies have yet to be explored in detail in the previous TNAs. The proposed TNA will focus on a high-energy consumption industrial sub-sector (SEZs in Sihanoukville), similarly to the 2013 TNA which, although nation-wide, focused on specific technologies in the transport and energy efficiency sectors. Furthermore, the proposed TNA will incorporate lessons from the prior 2003 and 2013 TNAs, which only provided generic recommendations without any detailed feasibility discussion on proposed mechanisms for generating investment proposals. Likewise, the implementation aspects relating to technology transfer were absent in the previous TNAs. The proposed TNA will close this gap by bringing together investment interests from the private sector including end-users, suppliers, and financial institutes. Of the nine operational SEZs in Cambodia, three are at the Sihanoukville Port. Cambodia’s SEZs differ substantially in size, with the larger SEZs in Phnom Penh, Bavet, and Sihanoukville accounting for a total of 439 factories. In particular, there have been documented complaints from Sihanoukville’s SEZ-based firms that electricity supplies are unreliable or insufficient (i.e. 400 MW nationwide supply shortages experienced in 2019 largely due to decreases in hydroelectric sources). During power outages, Sihanoukville SEZ’s power supply needs are currently being met by the use of backup diesel generators and other fossil-fuel based sources. During periods of regular electricity usage, Sihanoukville’s SEZs derive their electricity from the power grid operated by Electricité du Cambodge (EDC). Emissions from Sihanoukville province’s electricity generation is estimated to be 0.18 Mt CO2eq annually 2 . If completely decarbonised, this would represent nearly 6% of Cambodia’s NDC emissions reduction target. Given that the SEZs account for a large percentage of electricity consumption in Sihanoukville, prioritising technologies and strategies for their decarbonisation can lead to substantial upstream emissions reductions. Given its size (both in emissions intensity and number of emissions sources), a TNA for Sihanoukville’s SEZs offers an opportunity to address a significant source of emissions, and if further successful, enable concrete actions to replicate across other SEZs in Cambodia with high-emissions energy sources that may be experiencing similar shortages in electricity supply. Through key project deliverables, the proposal will aid in advancing Cambodia’s climate finance readiness. The output TNA and TAPs from this project will be reported to the UNFCCC, thereafter publishing projects seeking financial support to the international donor and development community. In addition, the TAPs will draw consideration of regulatory, institutional, and financial frameworks to accelerate market development for sustainable technologies. To bolster finance readiness, the TAPs will present business cases and outline investment strategies for the identified pipeline of technology interventions from the TNA. This will enable the NDA to present more detailed project documents to potential financiers (investors and/or funding institutions). The Cambodian government may also consider playing an active role of encouraging public private partnerships, acting as a guarantor for potential projects and working with institutions to deliver credit enhancement products that help to secure private sector finance for projects that are otherwise commercially unviable. The Cambodia National Designated Entity (NDE) for the Climate Technology Centre and Network of the UNFCCC Technology Mechanism will be consulted and fully engaged in the implementation of proposed activities. Cambodia’s NDE is the Ministry of Environment / the National Council for Sustainable Development (Dr. Hak Mao, Director of the Department of Science and Technology of the General Secretariat of the National Council for Sustainable Development-GSSD).

2 Calculated from EDC’s 2017 annual report and a 2016 grid emissions factor study: http://www.edc.com.kh/images/Annual%20Report%202017%20(English)__.pdf http://portal.gms-eoc.org/uploads/resources/1904/attachment/GEF-Cambodia_2010-2012.pdf

http://www.edc.com.kh/images/Annual%20Report%202017%20(English)__.pdfhttp://portal.gms-eoc.org/uploads/resources/1904/attachment/GEF-Cambodia_2010-2012.pdf


3. LOGICAL FRAMEWORK AND IMPLEMENTATION SCHEDULE

Outcomes Baseline Targets Activities (brief description and deliverables)

Anticipated duration: 18 months

Monthly implementation plan of activities 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18

Outcome 1: Institutional capacity and coordination mechanisms in place to govern and coordinate climate action and finance

Sub-Outcome 1.1: NDA inter-institutional coordination mechanism

1 (1 ongoing GCF project in the country and 1 completed Readiness proposal package; coordination mechanism currently being developed to engage the GCF)

2

Establishment of a committee, a set of project governing documents and an expanded coordination mechanism for the implementation of a low-emission and climate resilient Technology Needs Assessment (TNA). Activity 1.1.1: Conduct stakeholder analysis This activity will define the stakeholders to be directly involved in the TNA committee. The TNA committee will include representatives from the NDE, the public, NGO, private, and academic sectors as is needed to ensure project effectiveness, efficiency, sustainability, transparency, accountability and equity. In addition to and/or within these sectorial groups, the stakeholder analysis and TNA committee will include women and other vulnerable communities (e.g. indigenous people). Special care will be taken to involve stakeholders that can facilitate the transfer of knowledge and best practices from ongoing and past capacity building, mitigation and adaptation projects in Cambodia. Care will also be taken to account for SEZ ownership structures (and any variations in ownership structure between SEZs) during stakeholder identification. For an example of a UNIDO stakeholder analysis template form, see Annex II. Estimated completion date: Month 2 Deliverable 1.1.1: 1. TNA committee stakeholder matrix

X

Activity 1.1.2: Support establishment of a TNA Committee A TNA committee and a set of project governing documents will be created. These instruments, which will include a detailed monitoring and evaluation plan, will establish the authority to act and report on progress. They will be responsible for the subsequent appointment of key stakeholder groups and for ensuring their participation and engagement during the project lifespan. They will further guide the scheduling of activities and timelines, and will define the roles and responsibilities of all participating stakeholders (including review of outcomes and technical consultation as needed). A gender analysis will be conducted within the first two months that will be used to guide TNA committee member shortlisting. Results from the gender analysis will also be incorporated into the project governing documents and monitored to ensure compliance with UNIDO rules and regulations on gender equality, empowerment and mainstreaming throughout the project lifespan. Building on existing efforts to establish a coordination mechanism to engage the GCF under the NDA Strengthening and Country Programming Readiness Proposal and the Climate-Friendly Agribusiness Value Chains Sector Project, supplemented capacity will be provided to ensure the planned coordination mechanism is equipped to facilitate both the activities of the TNA and the subsequent pipeline of projects to be identified. These activities will also be coordinated with the Cambodia PCP to ensure

X X


efficient use of personnel and resources especially in work involving SEZs and agribusiness development. Training on the TNA process (including quality assurance) for all stakeholders will be required. The training will be organized over 2 days (Month 2 or 3) and will cover the overall process, the different steps in conducting the TNA, and the participatory planning and prioritization tools (e.g. multi criteria assessment tool, stakeholder engagement tools, and approaches for gender inclusiveness). Additionally, the training will include the modules on the importance of understanding and applying environmental and social safeguards, development of the TNA report and key parameters that should be taken into consideration when prioritizing technologies. Coordination with ongoing GCF-funded efforts will be pursued to extend the scope of a planned no-objection procedure. This will guarantee local ownership of project elements related to the TNA and associated action plans proposed. Collectively, these activities will be conducted in compliance with the TNA handbook and methodology. Estimated completion date: Month 3 Deliverable 1.1.2: 1. TNA committee and project governing documents including gender analysis and monitoring and evaluation plan 2. Augmented coordination mechanism and associated documents 3. TNA training delivered to stakeholders and associated documents including quality assurance, a full list of participants, photo documentation, and an official report of the training prepared 4. Extended no-objection procedure and associated documents

Activity 1.1.3: Development and endorsement of the TNA work plan The work plan will define and schedule TNA meetings to be conducted. Venues will be assigned by the responsible Ministry. Stakeholders engaged in the TNA committee will be required to contribute to the work plan in order to promote comprehensive participation from key sectors. This activity will be assessed on its compliance with the TNA handbook and methodology. Estimated completion date: Month 4 Deliverable 1.1.3: 1. TNA work plan developed and endorsed

X

Activity 1.1.4: Review and endorsement of the TNA governing documents The TNA project governing documents will be reviewed and endorsed citing the roles and responsibilities of main stakeholder groups in the TNA process and the method of engagement. Estimated completion date: Month 4 Deliverable 1.1.4: 1. TNA project governing documents reviewed and endorsed

X


Outcome 2: Country Programming process

Sub-Outcome 2.5: Appropriate climate technology solutions identified and prioritised in accordance with national strategies and plans for climate adaptation and mitigation

1 (country-wide TNAs for mitigation and adaptation were conducted in 2013 that identified priority sectors; no province or sector-specific TNA has been carried out)

2

The following activities support strategies for climate finance implementation across Cambodia’s SEZs. To guide GCF pipeline development and programming, investment in prioritized technologies will be based on emissions reduction potential analyses and climate vulnerability / risk assessments. For increased access to finance, Cambodia’s country programme will identify areas and potential interventions of highest impact and paradigm shift potential in complementarity with other climate financiers. Activity 2.5.1: Pre-selection of sub-sectors for the fulfilment of the TNA for Sihanoukville’s SEZs This activity will aim to identify and confirm priority sub-sectors based on articulated national climate objectives as outlined in Cambodia’s Nationally Determined Contribution and Climate Change Strategic Plan 2014-2023. Furthermore, prioritisation of sub-sectors will be aligned with GCF’s eight impact areas that deliver major mitigation and adaptation benefits. A methodology document (that includes a rationale and executive summary) will be developed for sub-sector selection. In preparing this document, national, provincial and sectorial plans and technology workshop proceedings will be assessed, including instances where stakeholders aimed to establish sectorial priorities in the past. High priority industries within Sihanoukville’s SEZs will be identified, and SEZ ownership structures (and regional differences therein) will be taken into consideration. In identification of priority sub-sectors, special emphasis will be placed on (i) opportunities for synergies with and (ii) integration of learning outcomes from ongoing and past projects. In total, three high-priority sub-sectors will be identified and carried forward. Examples of such projects are referenced in Section 1 above. In particular, the Cambodia PCP outlines the following outputs for the Siem Reap and Sihanoukville/coastal zone during the period January 2018 - December 2023: - Sustainable tourism value chain developed with increased local content, and strengthened upstream linkages to related value chains. - Agro-, creative- industries, industrial and service related value chains developed and linked to the tourism value chain. - Industrial diversification supported through the development of special economic zones, including those in support to the tourism and agro-industrial sectors. In the selection of priority sub-sectors, opportunities for synergy with the Cambodia PCP in its efforts to develop SEZs will be sought in all instances. Outcomes will be validated and supplemented by contributions from key stakeholders in a follow-up workshop (Month 5). Activities will focus mainly on the identification and elaboration of sector development needs for SEZs as they relate to and complement ongoing projects, as well as broader national development strategies and priorities (e.g. assessing national policies, existing national, provincial and sectorial plans, and strengths in the context of economic, social and environmental development priorities). Identification of such needs, priorities, and opportunities for synergy at the sectorial level will allow for targeted mitigation and adaptation technology identification and drafting of the TNA and action plan. Estimated completion date: Month 5 Deliverable 2.5.1: 1. Report describing methodology for sub-sector selection, including rationale and executive summary delivered.

X


2. Sub-sector selection workshop including a full list of participants and photo documentation.

Activity 2.5.2: Pre-selection of mitigation and adaptation technologies for the fulfilment of the TNA The aim of this activity is to validate and prioritize key mitigation and adaptation technologies for Sihanoukville’s SEZs that are aligned with and elaborate on Cambodia's NDC and Climate Change Strategic Plan 2014-2023. This will be done through a multi-criteria analysis and market assessment for technology selection that considers endogenous capabilities, national and provincial resources, skills base, NDC focus areas, Climate Change Strategic Plan 2014-2023 priorities, and sectorial plans through a participatory process for the fulfilment of the TNA. This activity will focus on identifying and obtaining consensus about priority technologies on a sub-sector by sub-sector basis. Furthermore, prioritisation of technologies will be aligned with GCF’s eight impact areas to deliver major mitigation and adaptation benefits. Key gaps in national and provincial policies and other barriers to technology implementation will also be identified. Opportunities for technology synergies between sectors (e.g. with the energy, manufacturing, tourism or agri/creative industry) and with neighbouring provinces will be explored. Particular emphasis will be placed on avoided CO2eq emissions as a quantitative evaluation metric. Along with technical data for each technology, these elements will collectively allow for the drafting of the technology action plans. Specific attention will be paid to long-term national climate and development priorities during the validation process of priority technologies. Identified technologies will be validated by key stakeholders in a workshop (Month 7). Estimated completion date: Month 8 Deliverable 2.5.2: 1. Final reports including a (i) mitigation TNA report and action plan and (ii) an adaptation TNA report and action plan with key stakeholders elaborated 2. Report of the validation workshops that elaborate on the multi-criteria analysis, market assessment and participatory process conducted. Development of a number of TNA briefs summarizing the main findings, recommendations and next steps 3. Technology pre-selection workshop including a full list of participants and photo documentation.

X X X

Sub-Outcome 2.6: Feasibility of selected climate technologies for mitigation and adaption assessed and incorporated into planning processes

0

1

Activity 2.6.1: Technology Action Plans (TAPs) This activity aims to develop TAPs that quantify the potential impact of priority technologies and aid in the development of a pipeline of future projects to be pursued under GCF funding. The process for the development of these TAPs will involve a number of interviews and consultations with key stakeholders across the public, private and academic setting and will target various experts based on the sub-sectors and technologies prioritized. The key output will be an identification of programmatic activities, financial costs, and a framework identifying the critical path of actions to be undertaken to meet the Cambodian climate objectives when implementing the recommendations of the TNA. The TAP(s) will: - elaborate detailed project ideas, including comprehensive time frames and a breakdown of the estimated budget for the project idea

X


- articulate project idea objectives, outputs, relation to national development priorities, deliverables, activities, timeline, budget and evaluation methods - consider elements such as research on the prioritized technology, capacity-building, financial schemes, pilot projects and technology demonstration - include an analysis of value chains, risks and overall barriers to implementation to aid policy development - consider the realms of regulatory, institutional, financial and information frameworks that may prevent the accelerated development of markets for environmentally sound technologies. Such barrier identification includes regulatory barriers, a lack of information, policy uncertainty and deficiencies in the understanding of economic and institutional frameworks - determine technology impact potential in terms of Cambodia’s GHG emissions reduction targets (conditional and unconditional), employment impact, and qualitative analysis of the co-benefits (mitigation and adaptation) in terms of both environmental and social perspectives resulting from the implementation of technologies prioritized - present a business case for each intervention including a clear description of how cost reductions and efficiency gains are to be evaluated and monitored over time. - outline an investment plan and timeline of associated activities with deliverables to ensure identified technologies are incorporated into a pipeline of projects to be funded under the GCF. Estimated completion date: Month 14 Deliverable 2.6.1: 1. Report and executive summary of each TAP for each of the priority technologies in compliance with the TNA, including project supports and project ideas as concrete actions for implementation The deliverable will: - recommend enabling frameworks to address identified barriers, including conducting an analysis of the economic and social barriers that hinder the transfer and uptake of prioritized technologies - assess the policy, institutional and financial options and technology risks to overcome these barriers and present project ideas and multiple actions that are categorized based on quantity of their identifications - prioritize a number of sub-sectors (e.g. renewable energy production, waste management, energy efficiency, and water treatment) - present a clear financial plan with timelines, benchmarks and indicators that will elaborate measures to overcome these barriers and thus aid policy makers, market actors and technology innovators. Financial assessments could include costs benefit analysis, return on investment, internal rate of return, net present value of a particular technology action/idea versus an alternate - present an investment plan with a timeline of deliverables for project pipeline development and funding proposal submission - present a business case for each technology proposed - target the high initial costs for technology deployment, transaction costs and the lack of an appropriate policy environment to enable such deployment - provide cost indications and assessments (financial incentives for implementation of an action), including potential domestic and international funding sources to deliver such actions, institutional/policy strengthening costs, market assessments and RD&D studies - develop legal and regulatory instruments to create a sound enabling environment for identified technologies


Sub-Outcome 2.3: Stakeholder engagement consultative processes

0

1

The following activities involve engagement with relevant stakeholders (executing entities, civil society organizations and private sector) to establish decision-making processes for implementation of GCF-funded activities. Activity 2.3.1: Validation of TAPs with stakeholders This activity aims to discuss and validate the TAP by the TNA key stakeholders (1 daily workshop session for each sub-sector over a 3-day period; Month 16). It will facilitate collaboration and sharing of experience, including lessons learnt and best practices. This is aimed at assisting stakeholders with the familiarization of identified technologies, such as awareness campaigns and training to enhance technical capacity, operation and maintenance, and data collection. Common methods to be utilized for this process include: interviews with experts and private sector stakeholders; market mapping and problem trees; dedicated validation workshops (will include women and vulnerable groups such as indigenous people); desk studies; and logical problem analyses. Estimated completion date: Month 16. Deliverable 2.3.1 1. Meeting report of the workshops for the validation of TAPs and analysis of co-benefits elaborated. List of attendance (with photo documentation) for the validation workshops to be provided.

X

Activity 2.3.2: Support the implementation of the TAP with communications, guidance and training This activity aims to deliver a capacity building package for TNA key stakeholders including training and support materials for the development and application of prioritized technologies. Where possible, this package will build upon, supplement, and elaborate existing efforts under the Climate-Friendly Agribusiness Value Chains Sector Project, and the Cambodia PCP. Relevant participants will include representatives from the NDA, NDE, GCF and the delivery partner. Stakeholders will be provided with 2 training seminars (Months 17 & 18) on modules including: (a) market mapping and problem trees to enable them to become more familiar with identified technologies (b) gender awareness tools to enhance implementation capacities (c) access to financing of prioritized technologies across domestic and international sources (d) technical capacity, operation, maintenance and data collection and (e) energy data assessment and modelling (f) environmental and social capacity building tools in line with UNIDO best practices. This activity aims to develop tools that will enhance existing energy data assessment and modelling of the energy system of Sihanoukville’s SEZs across consumption and production. This will assist in data inventories, measure identification and energy projections, financial assessments of technology project ideas and marginal abatement cost curves. Throughout this activity, GCF’s Investment Framework will be applied to prioritise technology investment recommendations against six criteria (impact potential, paradigm shift potential, sustainable development potential, needs of the recipient, country ownership, efficiency and effectiveness). Furthermore,

X X


Cambodia’s GCF project pipeline and country programme will be closely monitored to consider linkages that will support the TAP implementation. Estimated completion date: Month 18. Deliverable 2.3.2: 1. Capacity building package 2. Dissemination strategy 3. Market use cases for technologies resulting from stakeholder engagement 4. Policy briefs informing the regional workshops 5. Costs of effective measures by subsector. To be quantified using advanced energy models, capability and data inventory analysis. 6. Training seminars (2) including a full list of participants, photo documentation, and an official report of the training prepared.

Outcome 4: Climate finance strategies and project pipeline strengthened

Sub-Outcome 4.4: Market preparation and business planning for deployment and scale-up of prioritised climate technology solutions

1 (some knowledge sharing mechanisms currently exist under the GCF-funded Climate-Friendly Agribusiness Value Chains Sector Project and the Cambodia PCP)

2

Activity 4.4.1: Support of monitoring and communication mechanisms to facilitate knowledge transfer for market preparation and business planning This activity aims to support existing monitoring and communication mechanisms to ensure appropriate and timely execution of TAPs, as well as to facilitate knowledge sharing and transfer to existing programmes in the region (e.g. the Climate-Friendly Agribusiness Value Chains Sector Project and the Cambodia PCP). Opportunities for knowledge transfer to facilitate South-South collaboration with other provinces and countries seeking to de-carbonize SEZs will also be sought. These opportunities will leverage UNIDO’s expertise with network development and project implementation related to the development of eco-industrial parks in various countries within the regions. The TNA committee will: - Produce a one-page description of intended outcomes and impacts from the TAPs. This document will be used for communication purpose by the country in promoting the technical needs, fostering South-South cooperation and catalysing investments; - Prepare a monitoring and evaluation plan, identifying all relevant indicators as well as other specific, measurable, achievable, relevant, and time-bound indicators suitable to monitor Outputs and Activities in executing the TAPs; - Deliver the TAPs to the UNFCCC, to bolster visibility of concrete implementation projects for specific technologies seeking support from international donors and development agencies.3 Estimated completion date: Month 18. Deliverable 4.4.1: 1. Technical impact description document 2. Monitoring and evaluation plan

X

Sub-Outcome 4.5: Private sector engagement

1 (some private sector engagement exists in ongoing

2

Activity 4.5.1: Engaging the private sector in Cambodia's consultative processes This activity aims to expand private sector engagement in Cambodia via two consultative workshops across the TAP development process. The workshop will enable experience sharing, technical input, idea generation, lessons learned and best practices. Common methods to be utilized will include: interviews with experts and

X X

3 UNFCCC’s project database from developing countries’ TNAs: https://unfccc.int/ttclear/projects

https://unfccc.int/ttclear/projects


projects involving biogas mini-grids in Cambodia)

stakeholders; market mapping and problem trees; desk studies; and logical problem analyses. This will achieve input and perspective sharing on the market readiness of technologies and the potential deployment. Where possible synergies with the Climate-Friendly Agribusiness Value Chains Sector Project, and the Cambodia PCP will be sought. Estimated completion date: Month 9. Deliverable 4.5.1: 1. Workshops (2) enabling private sector input into the sub-sector and technology prioritisation including a full list of participants and photo documentation


4. ADDITIONAL INFORMATION (ONLY FOR ADAPTATION PLANNING SUPPORT)

This section is only to be completed when seeking support for formulation of national adaptation plans and/or other adaptation planning processes. Please see Part 3 Section 4 in the Readiness Guidebook.


5. BUDGET, PROCUREMENT, IMPLEMENTATION, AND DISBURSEMENT

5.1 Budget plan Please complete the Budget Plan in Excel using the template available in the Library page of the GCF website. 5.2 Procurement plan Please complete the Procurement Plan in Excel using the template available in the Library page of the GCF website. For goods, services, and consultancies to be procured, please list the items, descriptions in relation to the activities in section 2, estimated cost, procurement method, relevant threshold, and the estimated dates. Please include the procurement plan for at least the first tranche of disbursement requested below and provide a full procurement plan for the entire duration of the implementation period if available at this stage. 5.3 Disbursement schedule Please specify the proposed schedule for requesting disbursements from the GCF. For periodicity, specify whether it’s quarterly, bi-annually or annually only. UNIDO will manage the disbursement request and schedule guided by the appropriate agreement and in line with its rules and regulations. For more details, see tab 5.1 of the Budget Plan in Excel.

☒ Readiness Proposal that falls within a Framework Agreement with the GCF Disbursements will be made in accordance to Clause 4 “Disbursement of Grants” and Clause 5 “Use of Grant Proceeds by the Delivery Partner” of the Framework Readiness and Preparatory Support Grant Agreement entered into between GCF and UNIDO on 15 January 2019. The Delivery Partner is entitled to submit 2 request(s) for disbursement each year and an Interim Request for Disbursement within 30 days of approval by the GCF of a proposal, which must be in accordance with the Framework Agreement.

UNIDO will manage the disbursement request and schedule guided by the appropriate agreement and in line with its rules and regulations.

https://www.greenclimate.fund/library/-/docs/list/574044https://www.greenclimate.fund/library/-/docs/list/574044


6. IMPLEMENTATION ARRANGEMENTS AND OTHER INFORMATION

6.1 Implementation map Please describe how funds will be managed by the NDA and/or the Readiness Delivery Partner.

The Ministry of Environment (MOE)/National Council for Sustainable Development (NCSD) is the NDA to the GCF . The Department of Science and Technology (DST) is under the General Secretariat of the National Council for Sustainable Development (GSSD) of the NCSD (see full NCSD organizational chart in Annex IV). The DST is responsible for promoting scientific, data-led approaches to environmental issues and promoting new technologies needed to better respond to climate change issues. The DST of the GSSD will be the NDE for this Readiness project, for which the national contact will be Dr. Hak Mao, Director of the DST (email: [email protected]).

The Royal Government of Cambodia has appointed UNIDO as its delivery partner (DP) for this GCF Readiness and Support Programme. UNIDO will lead the implementation of the proposed programme, including the fiduciary management. UNIDO will be responsible for the implementation of the readiness activities and for procurement and contractual services, as well as reporting on the progress of this implementation in close coordination and strategic guidance from the NDA as the main beneficiary.

Financial management, procurement actions and operational services will be carried forward in accordance with UN regulations, rules, policies and procedures. All final Intellectual Property Right (IPR) of project deliverables will have UNIDO ownership, as specified in UNIDO’s contract for services (Annex A - General Terms and Conditions, Clause 1 and 19). All third party IPR will comply with the GCF-UNIDO Readiness Framework Agreement. More specifically, in accordance with Clause 16.03, UNIDO will ensure that “the Services provided do not violate or infringe any industrial property or intellectual property right or claim of any third party”4. Furthermore, project due diligence on Anti-Money Laundering / Countering the Financing of Terrorism (AML-CFT) will be carried out according to UNIDO policies on Financial Disclosure and Declaration of Interests (DGB/(M).118), Business Sector Partnerships (DGB/2017/07), and Fraud Awareness and Prevention (DGB/(M).94). These policies, combined with UNIDO’s Investigation Guidelines (DGAI.19) and Internal Control Framework (DGB/(M).119), ensure compliance with relevant UN Charter and Security Council Resolutions.

The UNFCCC country focal points for technology (NDE) and finance (NDA) will provide active support to the implementer in the execution of this technical assistance. Their roles as country focal points will include, but not be limited to: ensuring the activities associated with the implementation of this technical assistance are aligned with national climate priorities; promote and engage with key stakeholders as identified by the implementer; promote and present this technical assistance in climate change-related events; and participate in events and in national workshops affiliated with this technical assistance, if required. They will also be expected to provide guidance and review any relevant documents produced, and will be kept apprised of the progress of the technical assistance. Capacity building mechanisms for Cambodia’s government agencies involved in this proposal will

4 https://www.greenclimate.fund/documents/20182/574754/Readiness_framework_agreement_-_UNIDO.pdf/622f6e09-2626-7d05-4ebc-c76e1042f05b


focus on centralized knowledge dissemination through training programs and workshops. Focal points from ministries will be selected as the trainer or leader for a specific subject or activity, which is then utilized throughout project implementation. For more specific information regarding the role of the NDA and its interaction with the delivery DP (i.e. UNIDO) refer to Annex III.

The TNA committee will be established to provide strategic guidance and oversight of the project as well as to ensure country ownership and alignment of project activities with the national priorities. During the first meeting of the TNA committee, the members will approve the terms of reference of the TNA committee and decide if additional members need to be invited. The TNA committee will report to the NDA on its activities.

A UNIDO headquarters-based project manager (PM) will be responsible for the steering and managerial supervision of the project, including the overall financial management, recruitment and procurement of goods and services. The PM in consultation with the TNA committee will ensure that project monitoring and evaluation run according to an agreed schedule, and in line with UNIDO and GCF requirements. The PM will also be responsible for developing and executing a detailed work plan for the project (Deliverable 1.1.3). The PM will also ensure the alignment of technical inputs with international best practices and UNIDO quality standards. For the day-to-day operation, coordination and implementation of project activities, a national project coordinator will be recruited. This will ensure close liaison between the DST and UNIDO throughout the project. Staff recruitment to include: • International Consultant: 2+ years of climate change expertise and experience with technology needs

assessments. • Local Consultant: 5-7 years of climate change expertise and experience with technology needs

assessments (with Masters degree).


6.2 Risks, monitoring and evaluation (M&E), and other relevant information

Risks Below can be found potential risks that might prevent the project objectives from being achieved and the proposed measures that address these risks at the time of project implementation:

Risk

Rating

Mitigation

Engagement risk: Lack of engagement from key stakeholders (Electricité du Cambodge, Electricity Authority of Cambodia, SEZ industrial businesses, Sihanoukville SEZs and Port SEZ, Cambodia SEZ Association, Cambodia Special Economic Zone Board, Ministry of Industry and Handicraft, Ministry of Mines and Energy, The Council for the Development of Cambodia, Sihanoukville community members, private technology companies, etc.) 5

Low Dissemination strategy and an organizational targeting to enhance primary stakeholders attend TNA related events.

Delay risk: Delay in implementation of readiness programme

Low Project management procedures in place. UNIDO actively engaged.

Recruitment risk: Delays due to inability to procure local and international climate consultants with experience in Cambodian electricity and SEZ markets

Medium Highlight need to expedite the process with project partners in first project meetings. Dissemination of procurement process through TNA committee network and channels.

Involvement risk: Lack of interest by the public and private sector key stakeholders (Electricity Authority of Cambodia, Sihanoukville SEZ and Port SEZ owners, etc.), resulting in limited interest of local players to scale up the results of this intervention

Low During project implementation, a thorough consultative and participatory approach will be applied; key private sector and industry stakeholders have been identified and targeted in consultation with the NDA of Cambodia.

Technical/Capacity risks: Lack of capacity by the national counterparts (Ministry of Environment, Ministry of Industry and Handicraft, Ministry of Mines and Energy) to use or implement the results and conclusions of this technical assistance

Low The project is in line with national policies and the project will be executed in close coordination with the respective Ministry and authorities; A number of regional workshops and policy briefs will be delivered to enhance capabilities.

Management Risk: Lack of effective coordination between various project partners (UNIDO, NDE and NDA)

Low Proper coordination will be sought through the coordination mechanism developed by the TNA committee.

Ownership of the results: True ownership by the government and system operator (Electricity Authority of Cambodia) to ensure results are used and scaled up accordingly

Medium The ownership of the project has been secured by the Government given that it falls under their work plan.

Climate Change Risk: Negative impacts of climate change and extreme weather events (e.g. Cambodia has a history of life-threatening and damaging flooding events which are being exacerbated by climate change6)

Low The potential impact of extreme weather events in Cambodia will be considered throughout the engagement process. Particular attention will be paid to flooding risks given the close proximity of Sihanoukville SEZs to Cambodia’s shoreline.

Access to data: Data accessibility, mainly from the national utility (Electricity Authority of Cambodia) and other involved stakeholders (SEZ owners/managers, SEZ industrial businesses, private technology companies, etc.)

Medium Communication channels and information sharing has been secured, their ownership clarified, and data accessibility requirements to be continually amplified throughout project engagement activities

5 Further description on some of the stakeholders expressed here are provided in Annex V. 6 https://www.greengrowthknowledge.org/resource/environmental-sustainability-asia-cambodia

https://www.greengrowthknowledge.org/resource/environmental-sustainability-asia-cambodia


(workshops, meetings, trainings). Same for the other stakeholders.

Gender Risk: Resistance against or lack of interest in, the project activities from stakeholders, especially with regard to the active promotion of gender equality. Low participation rates of suitable female candidates due to lack of interest, inadequate project activity or missing qualified female population within the i.e. engineering sector.

Low This project will pursue gender responsive integration, and will ensure stakeholder involvement at all levels, with special regard to involving women and men.

Monitoring & Evaluation (M&E) A periodical project monitoring, evaluating, and reporting process will be set up by UNIDO in line with its organizational rules and regulations and in consultation with the NDA (Ministry of Environment) to systematically assess the results achieved as project activities and deliverables are completed. The M&E plan will include specific, measurable, achievable, relevant, and time-bound indicators that will be used to assess the timeliness and effectiveness of the project’s implementation. These indicators will be decided by the project team and should incorporate and build off of relevant institutional readiness and impact indicators included in Cambodia’s national M&E framework for climate change response.7 Moreover, an internal communication plan will be setup between project team members, i.e. UNIDO personnel, the TNA committee, and the NDE (Department of Science and Technology). External reporting processes to the NDA and GCF will also be agreed upon. The detailed M&E plan (included in Deliverable 1.1.2), with a clear structure and set of project milestones, will be developed in the inception phase of the project. Moreover, the M&E plan will include utilization of the ‘Readiness Interim Progress Report’ based upon an agreed schedule, comparing against the work plan, budget, and agreed targets. Throughout the project, UNIDO will assess and propose potential revisions or adaptations to activities and milestones to manage project scope in relation to future implementation success. Upon completion of all activities and outputs, evaluation forms will be completed by the (i) NDA about overall satisfaction level with the technical assistance service provided; (ii) the lead implementer about the knowledge and learning gained through delivery of technical assistance; and (iii) the TNA committee about timeliness and appropriateness of the delivery of the activities and outputs. At project end, UNIDO will prepare and submit the ‘Readiness Completion Report’ to the NDA and GCF. UNIDO’s Prior Working Relationship with NDA Cambodia’s NDA (Ministry of Environment) is one of the main participating ministries in UNIDO’s Programme for Country Partnership (PCP). One of the priority areas identified by PCP Cambodia is sustainable industrial development of Cambodia’s SEZs. A number of projects with various government ministries are ongoing and several others are in the pipeline. For example, one of UNIDO’s proposed projects is “Supporting Cambodia in the development of a masterplan for the multi-purpose special economic zone of Sihanoukville province” (ID: 180100). The following table highlights ongoing UNIDO projects for which the MOE/NCSD is actively involved.

Project ID

Title Roles and responsibilities of MOE/NCSD

Geographic coverage

120118 Reduction of GHG Emissions Through Promotion of Investments in Biogas Mini-Grids

Co-chair of Project Steering Committee

Cambodia

150275 Low carbon development for productivity and climate change mitigation through the Transfer of Environmentally Sound Technology (TEST) methodology

Member of Project Steering Committee

Cambodia

150033

Demonstration of Best Available Techniques (BAT) and Best Available Practices (BEP) in Open Burning Activities in Response to the Stockholm Convention on Persistent Organic Pollutants (POPs)

MOE has designated an official as project director

Asia & Pacific countries

7 National M&E Framework for Climate Change Tracking Adaptation and Measuring Development (TAMD) in Cambodia (2015). https://pubs.iied.org/pdfs/10118IIED.pdf

https://pubs.iied.org/pdfs/10118IIED.pdf


Start Date After the approval of the Grant, a notification letter will be sent by the GCF to NDA with copy to the Delivery Partner. The date of such notification by the GCF will be treated as the start date for project implementation. From that date, the end date of implementation will be calculated considering the total duration of the project as presented in the approved proposal.


Annex I: Additional Background Information

Separation of responsibilities in Cambodia’s electricity sector:

Ministry of Mines and Energy Electricity Authority of Cambodia • Energy policies • Electric power strategies • Power development plan • Technical, safety, and environmental

standards • Other duties

• Issue regulations • Issue licenses to electric power

service providers • Review costs and approve tariffs • Resolve disputes • Regulate, impose penalty

Overview of Cambodia’s SEZs and enabling frameworks. Cambodia established the legal framework for SEZs with a 2005 decree. By the year 2014, 9 SEZs were operating and 20 more had been authorized. Of the nine operational SEZs, three were at the Sihanoukville Port. The SEZs differ substantially in size, with the larger SEZs in Phnom Penh, Bavet, and Sihanoukville accounting for a total of 439 factories. By contrast the Poipet O’Neang and Koh Kong SEZs account for only six. The SEZs are primarily export-processing zones, where firms import almost all of their intermediate inputs and sell almost none of their outputs on the domestic market. The SEZs are privately owned and managed: the operator is required to have at least 50 hectares (ha) of land and is responsible for roads, electricity, and water supply. The state provides a one-stop service with representatives of all relevant government agencies on site, for which the zone operator pays a fee. Firms locating in an SEZ must first obtain approval; this requires a minimum $500,000 investment in fixed assets. Almost all firms in SEZs are foreign owned. Their privileges include guarantees of no price or foreign exchange controls, free remittance of foreign currency, exemption from import duty and value-added tax (VAT), a 20% corporate tax rate, and tax holidays of 9 years for the zone developer and of variable length for other firms. These privileges are, however, not necessarily exclusive, as firms outside the zones are entitled to apply for such privileges. In Cambodia, SEZs serve as enclaves that provide a stable business environment, reasonable infrastructure and public utilities, and less red tape, relative to other regional locations where producers respond to tax or other financial incentives. Cambodia’s SEZs within the context of climate change. In November 2013, The Royal Government of Cambodia officially launched the first-ever, Cambodia Climate Change Strategic Plan 2014-2023. The CCCSP captures the main strategic objectives and directions for a climate-smart development of Cambodia over a 10-year period. The CCCSP covers 8 strategic objectives, as follows:

1. Promote climate resilience through improving food, water and energy security, 2. Reduce vulnerability of sectors, regions, gender and health to climate change impacts, 3. Ensure climate resilience of critical ecosystems (Tonle Sap Lake, Mekong River, coastal ecosystems,

highlands etc.), biodiversity, protected areas and cultural heritage sites, 4. Promote low-carbon planning and technologies to support sustainable development of the country, 5. Improve capacities, knowledge and awareness for climate change responses, 6. Promote adaptive social protection and participatory approaches in reducing loss and damage, 7. Strengthen institutions and coordination frameworks for national climate change responses and 8. Strengthen collaboration and active participation in regional and global climate change processes

The Royal Government of Cambodia has additionally outlined the following goals for climate mitigation in its Nationally Determined Contribution (NDC):

1. Energy industries, manufacturing industries, transport, and other sectors: Cambodia intends to undertake actions, the impact of which is expected to be a maximum reduction of 3.1 Mt CO2eq compared to baseline emissions of 11.6 Mt CO2eq by 2030.

2. Land Use, Land-Use Change and Forestry: Cambodia intends to undertake voluntary and conditional actions to achieve the target of increasing forest cover to 60% of national land area by 2030. In absence of any actions the net sequestration from LULUCF is expected to reduce to 8.0 Mt CO2eq in 2030 compared to projected sequestration of 18.5 Mt CO2eq in 2010.

In line with these objectives, and the government’s broader vision to transform and modernize Cambodia’s industrial structure from a labour intensive to a skill-driven sector by 2025, SEZs have been identified as a priority sector for industrial development along with tourism and agri/creative industries. However, sharp increases in the number of construction projects and a growing expatriate population related to SEZ development and diversification over the past five years, especially in the Sihanoukville province, has led to shortages in electricity supply (up to 400MW in available electricity nationally). To date, there have been documented complaints from SEZ-based firms that electricity supplies are unreliable or insufficient. These needs are currently being met by the use of backup


diesel generators and other fossil-fuel based sources. Activates related to SEZ development have additionally placed strains on the ability of local authorities to effectively manage and treat waste streams generated. In June 2019 the Sihanoukville Provincial Hall Report indicated that municipal waste in Sihanoukville had risen from 120 tons/day in 2017 to 450 tons/day in 2018 and further increased to over 700 tons/day in early 2019 with further increases projected. In response to these collective concerns, the Electricity Authority of Cambodia established regulations on general conditions, both technical and legal, for connecting solar PV systems and other consumer-generated electricity to the national grid. Within the new regulations, the first directive sets the solar PV supply tariff based on the aggregate cost of all electricity sources in the national grid. The second directive allows for lower-voltage consumers to develop standalone solar PV systems without the need for permits. In addition to the new regulations, the Government of Cambodia (including the NCSD, Ministry of Mines and Energy, Ministry of Environment) are actively seeking regulatory approaches to de-risk investment in renewable energy projects. A collaborative 2019 study led by the United Nations Development Programme outlined a number of priority regulatory actions for the Government of Cambodia to take in the solar PV market:

Sub-sector Priority De-risking Measures Utility-scale PV

- Implement a transparent and competitive auction mechanism, with a standardized Power Purchase Agreement - Perform grid stability studies, transparently share findings; technical support & software for grid management

Rooftop PV - Expansion of regulations to low-voltage customers, including balanced solar capacity charges - Policies allowing export of power to the grid, for instance via net-metering or feed-in tariff

Solar-Battery Mini-Grids

- Strengthen capacities of existing government bodies/establish a government body or unit to advance/oversee/improve off-grid electrification - Implement a dual regulatory regime (comprehensive & light-touch), including license

Solar Home Systems

- Develop and enforce technology guidelines/standards for solar home system equipment - Extend current policies on digitalization, including stronger rural cellular coverage & competitive mobile money

This year, Cambodia’s council of ministers additionally approved four new large-scale solar power projects with 140 MW of total capacity: a 20 MW solar park in the Svay Rieng province, a 60 MW project in the Battambang province, and two additional 30 MW facilities in the Pursat and Banteay Meanchey provinces. Along with these initiatives, the following projects have reached the implementation phase over the past three years: Ongoing

- Climate-Friendly Agribusiness Value Chains Sector Project (GCF-funded) - Cambodia Programme for Country Partnership (implemented by UNIDO with financial support from the

governments of China and the Republic of Korea) - Reduction of GHG Emissions Through Promotion of Investments in Biogas Mini-Grids (implemented by

UNIDO and the GEF) - Low carbon development for productivity and climate change mitigation through the Transfer of

Environmentally Sound Technology methodology (implemented by UNIDO and the GEF)

Past - NDA Strengthening and Country Programming (GCF-funded Readiness Proposal) - Climate Change Related Technology Transfer for Cambodia: Using Agricultural Residue Biomass for

Sustainable Energy Solutions (implemented by UNIDO and the GEF) - Reducing Greenhouse Gas Emissions through Improved Energy Efficiency in the Industrial Sector

(implemented by UNIDO and the GEF) - Trade Capacity-Building in the Mekong Delta Countries of Cambodia, Lao People's Democratic

Republic and Viet Nam, through Strengthening Institutional and National Capacities Related to Standards, Metrology, Testing and Quality (SMTQ) Phase III (implemented by UNIDO with financial support from the Government of Norway)

References and further reading [1] The role of special economic zones in improving effectiveness of greater Mekong subregion economic corridors. Manila: Asian Development Bank (2018). [2] Warr, P., and Menon, J. Cambodia’s Special Economic Zones. ADB Economics Working Paper. No. 459. Manila: Asian Development Bank (2015). [3] Cambodia’s Intended Nationally Determined Contribution [4] Cambodia Climate Change Strategic Plan 2014–2023 [5] Cambodia Energy Sector Assessment, Strategy and Road Map. Manila: Asian Development Bank (2018). [6] Cambodia: Derisking Renewable Energy Investment: UNDP (June 2019).


Annex II: Stakeholder Analysis Form


Annex III: Roles and Responsibilities of NDA

The General Secretariat of the National Council for Sustainable Development (GSSD)/MOE (the NDA) will provide strategic oversight for the implementation of the readiness project and will be responsible for the institutional coordination of activities, project stakeholders and Readiness Delivery Partners. The NDA will facilitate engagements with other relevant government ministries and Sihanoukville municipalities, as needed. The NDA will host workshops and missions. Recently, the Department of Science and Technology (DST) of the GSSD/MOE will be the project coordinator for this Readiness project. In general, the DST is responsible for promoting scientific, data led approaches to environmental issues and promoting new technologies. On an as-needed basis, other government ministries will provide technical inputs into the project, in particular on situational analyses of energy demand sectors (e.g. transport), policy and regulatory gap analyses, or market and technical assessments. Municipalities’ technical inputs will be sought, in particular on the situation analysis, the economic, environmental and social assessment and the education and communication needs. The NDA will lead the engagement with businesses and business associations for activity 2.4. to support the Readiness team in accessing relevant associations (e.g. request for meetings, invitations to workshops, requests to share data). The NDA and respective line ministries will also lead the engagement with business associations following the findings of the study with the goal to confirm support for the study’s conclusions and recommendations. As the Department of Science and Technology (DST) of GSSD/MOE was newly appointed as the lead department for initiatives, coordination and management of clean energy technologies in Cambodia, one of the objectives of the private sector engagement is to help establish a network between relevant business and associations and the DST, and to facilitate their knowledge sharing. The NDA and line ministries will also help the Readiness team to engage the private sector for the concept note. Beyond business association, the Readiness team will engage specific financial institutions and businesses involved in the supply chain for relevant clean energy technologies. The DP will implement and supervise the Readiness support project from inception to closure. The DP will pay directly to goods suppliers and non-consulting and consulting services as per the respective contracts. The DP will submit portfolio reports and audited financial statements to the GCF as per the Framework Agreement. The DP will prepare requests to the GCF, as necessary, for budget changes and reallocation. In close collaboration with the NDA, the DP will prepare project closing documents including externally audited financial statements and submit to the GCF. The DP will ensure that all funds are provided on a timely basis to ensure expediting and acquittal of funds are not delayed, and all funds are accounted and transparent. The DP and the DST will be responsible for the recruitment and day-to-day management of consultants as well as quality assurance of the deliverables (there will be a separate agreement between the DP and the DST). The DP will work with the NDA to implement work plan and ensure timely delivery of outputs. Consultants will share all outputs with the NDA, including data collected and models used to conduct the assessment. The NDA will have final ownership of the data produced by consultants.


Annex IV: Organizational Structure of NCSD8

8 https://ncsd.moe.gov.kh/ncsd/ncsd-organizational-chart

https://ncsd.moe.gov.kh/ncsd/ncsd-organizational-chart


Annex V: Preliminary Stakeholders Identified Electricité du Cambodge (EDC) EDC is a government-owned utility, serving Phnom Penh, Sihanoukville, Siem Reap, Kampong Cham, Takeo and Battambang, accounting for nearly 90 percent of total electricity consumption. EDC has the rights and responsibilities for generating, transmitting and distributing electricity throughout the Kingdom of Cambodia in conformity with its commercial obligations stipulated by laws, statute, license and other regulations of the government of Cambodia. Electricity Authority of Cambodia (EAC) EAC is an autonomous body set up to regulate and supervise the provision of electricity services across all of Cambodia. The EAC is responsible for issuing licenses, providing electricity services and approving and enforcing operating standards for license holders. This is all done to ensure a secure quality of electricity supply and service to consumers and the fair pricing and charging of electricity services. Sihanoukville SEZ Network There are 5 related SEZs that have been developed in the Sihanoukville province. They are (year established in brackets): Sihanoukville SEZ 1 (2009); Sihanoukville SEZ 2, also known as Sihanoukville Special Economic Zone (2008); Sihanoukville Port SEZ (2012); S.N.C SEZ (2002); and Stung Hav SEZ (2005). High-level managers and operators of the SEZs will be key stakeholders to engage with in this project. The Council for the Development of Cambodia (CDC) CDC is the highest decision-making level of the government for private and public sector investment. It is the sole and one-stop service organization responsible for the rehabilitation, development and oversight of investment activities. The CDC is also responsible for the evaluation and the decision-making on all rehabilitation, development and investment project activities. Ministry of Industry and Handicraft (MIH) As a government ministry responsible for industry and handicrafts, the MIH now takes the lead in reforms and policies which are directly related to the development of SEZs:

• Industrial Development Policy 2015-2025: The policy aims to diversify the economy, decrease its dependence on traditional sectors such as garments, tourism and agriculture, and direct Foreign Direct Investment (FDI) towards agro-businesses, handicrafts and light manufacturing.

• Promoting SMEs: MIH is in the process of drafting an SME Promotion Policy aimed at providing a national-level framework to promote and regulate SMEs as well as clarify a tax regime for the sector.

• Green Industry Initiative: MIH has called for companies to investigate alternative, renewable energy sources, which will in turn reduce energy costs, strengthen production capacity and promote value added industries that go beyond producing only raw materials without incurring additional costs.

Ministry of Mines and Energy The Ministry of Mines and Energy acts as a Marshal for the Royal Government on the mission of directing and controlling the mining and energy sectors. The Ministry has the mission to develop and implement policies, legal frameworks and regulations related to mining and energy management (including oil, gas and electricity sectors). Cambodia Special Economic Zone Board (CSEZB) CSEZB is the CDC's operational arm for private sector investment. CSEZB takes charge of investment projects in SEZs. It reviews investment applications and grants incentives to investment projects to meet the requirements laid out in the 1994 Investment Law. This law streamlined the foreign investment regime and provided generous and competitive incentives for direct private sector investment. Cambodia SEZ Association The SEZ Association, which includes representatives from all of Cambodia’s SEZs, has the mission to give SEZs more power to deal directly with the government and potential investors. The association also works with the government on drafting new legislation to govern SEZ operations, as well as meet, discuss and share information to find solutions to common challenges. Although not fully functioning currently, the SEZ Association has potential to strengthen public-private dialogue and partnership as well as create linkages among SEZs. Once fully developed, the Association can be utilized as a platform where SEZs can interact and share information regularly, discuss common issues, and facilitate equal opportunities for small-scale SMEs.

The following considerations are important when completing the budget:

1. Before preparing the Readiness and PPF budget, please read the full guidance on our website

2. You can select the appropriate budget categories from the dropdown list in the budget plan:

3. To insert additional rows, right click on the row number below where you wish to insert the new row and choose INSERT.

4. Additional budget categories may be added by manually typing them on the Budget Category sheet. :

Project Management Cost: Project management costs (PMC) are the direct administrative costs incurred to execute a project. They should cover only incremental costs incurred due to the GCF contribution. In most cases, these costs are directly related to the support of a dedicated project management unit (PMU) which managesthe day to day execution related activities of the project.

General Principles for PMC costs: 1. The percentage of PMC financed by GCF should not be more than the percentage share of the overall budget financed by GCF 2. PMC budget thresholds: Up to 7.5 per cent of total activity budget. > PMC exceeding 7.5 per cent for the readiness (including NAPs) proposals, and PPF proposals, up to $ 3 million will require detailed documentation and justification supporting the entire PMC budget. > The PMC should be shown as a separate component in the project budget. A detailed breakdown of PMC should be provided by budget category. > Indicative list of eligible project management costs:

> Project staffing and consultants: Project manager, Project Assistant, Procurement personnel, Finance personnel & Support/admin. Personnel> Other direct costs: Office equipment, Mission related travel cost of the PMU, Project management systems and information technology, Office supplies, Audit cost

Contingency :1. Select the appropriate % of Contingency Budget from the dropdown list :

2. Contingency budget for unforeseen costs arising during the project implementation should not be included in the outcome budget separately.3. Contingency budget must be used for any unforeseen programme (output level) cost that is unrelated to implementation/service fee.4. Any use of contingency must be reported to and agreed by the GCF Secretariat in writing in advance provided with justifications that are acceptable to the GCF5. If you get to the end of the project and you haven’t spent Contingency, you can’t increase the scope of the project or buy some more equipment to use it up.

6. The Budget Notes sheet should be used to record explanations, further details or cost breakdowns for individual lines

(https://www.greenclimate.fund/how-we-work/empowering-countries).

If you are unsure about how to complete the budget template, please send your query to: [email protected]

Readiness Grant Budget Preparation Guidelines

https://www.greenclimate.fund/how-we-work/empowering-countrieshttps://www.greenclimate.fund/how-we-work/empowering-countrieshttps://www.greenclimate.fund/how-we-work/empowering-countrieshttps://www.greenclimate.fund/how-we-work/empowering-countrieshttps://www.greenclimate.fund/how-we-work/empowering-countrieshttps://www.greenclimate.fund/how-we-work/empowering-countries

5.1 Budget PlanPlease add rows for Outcomes, Outputs and Cost Categories as required. Additional budget categories may be added by manually typing them on the Budget Category sheet.

Consultant - Individual - International W/Day 44 500.00 22,000.00

Consultant - Individual - Local W/Day 68 300.00 20,400.00

Workshop/Training Lumpsum 1 3,000.00 3,000.00

Travel - International Trip 2 3,000.00 6,000.00 Travel – Local Trip 8 300.00 2,400.00 Audio Visual & Printing Lumpsum 2 400.00 800.00 IT Equipment Lumpsum 1 2,000.00 2,000.00 Consultant - Individual - International W/Day 30 500.00 15,000.00 Consultant - Individual - Local W/Day 56 300.00 16,800.00 Workshop/Training Lumpsum 2 3,000.00 6,000.00 Travel – Local Trip 8 300.00 2,400.00 Audio Visual & Printing Lumpsum 6 400.00 2,400.00



Travel – Local Trip 2 300.00 600.00

Audio Visual & Printing Lumpsum 3 400.00 1,200.00





Travel - International Trip 1 3,000.00 3,000.00

Travel – Local Trip 8 300.00 2,400.00



Consultant - Individual - Local W/Day 5 300.00 1,500.00 Travel - International Trip 2 3,000.00 6,000.00 Audio Visual & Printing Lumpsum 2 400.00 800.00




Total Outcome Budget 204,100.00 102,700.00 42,700.00 58,700.00 - - -

Consultant - Individual - Local W/Day 20 300.00 6,000.00 UNIDO will th

Travel – Local Trip 2 300.00 600.00

Office Supplies Lumpsum 3 500.00 1,500.00

Audit Fee Lumpsum 2 2,500.00 5,000.00 do not change the formula do not change the formula

Audio Visual & Printing Lumpsum 2 400.00 800.00 15,300.00 15,307.50

IT Equipment Lumpsum 1 1,400.00 1,400.00 7.50% 7.50%

OutcomesDisbursement Plan

Budget Categorieschoose from the drop-down list

Unit 6m 36mTotal Budget(per budget category)

Total Budget(per outcome)

Detailed Budget (in US$)

Unit Cost# of Unit 30mTotal Budget(per sub-outcome)

56,600.00

24m18m12m

48,100.00

13,200.00

28,000.00

8,500.00

4,800.00

48,100.00

5,000.00 5,800.00

42,600.00

32,800.00

123,500.00

34,100.00

7,000.00 6,200.00

Sub-Outc

Documents

with United Nations Industrial Development Organization (UNIDO) · 2020. 11. 26. · +43 1 26026 3850 +43 1 26026 3983 . [email protected]. [email protected] United Nations Industrial