International Environmental and Social standards and nancing are closely linked.
Experience from GET FiT Uganda is that developers perceive limited incentives to carry-out high quality E&S
documentation and preparations. In this regard, the GET FiT program has not only upheld IFC Performance Standards
as requirements but also eectively gave a nancial incentive in the form of the GFPPM. More generally, in terms
of expecting international E&S standards in LDCs, donors must be prepared to put in considerable eort and
cost-sharing resources – as these will not be fullled without such external support. Furthermore, as international
standards are ultimately “imposed” by the international community it is arguably a reasonable cost to be carried
by funders. Even with the DFI involvement in senior debt, the GET FiT implementation team had to be far more
involved in ensuring IFC Performance Standards were met than what was expected at the outset.
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No Short-cuts.
In terms of making infrastructure projects in LDCs
bankable and leaving a lasting impact, there are
no short cuts or innovative mechanisms that allow
development partners to avoid long-term commitment
or putting in place the right human resources.
Move from “private” investment to
a broader “commercial” investment
definition.
Especially in infrastructure in LDCs, goal hierarchies
which target private nancing are likely to be premature
and potentially costly for utilities and/or end-users.
Scalability of the GET FiT top-up
design.
The GFPPM mechanism has proven well designed and
targeted, and has been exibly applied to both REFiTs
and a solar auction. In terms of developed countries
shouldering some of the cost burden of renewables
and emission avoidance, this is a strong candidate-
model for scaling up climate nancing.
Development partners cannot be
spectators.
Successful investors recognize that they cannot simply
invest and await a return. Governments seeking
development support need to work closely with
prospective donors and donors should not expect
to simply grant, monitor and evaluate. A dening
aspect of GET FiT has been the active engagement of
donors in appreciating challenges and contributing to
solutions in a coordinated fashion under the umbrella
of the Steering Committee. In this manner, GET FiT has
ensured true sector coordination and a platform for
active donor participation.
KEY LESSONS
Concluding remarks to potential funders of future programmatic PPPs
targeting leverage and long-term policy impacts:
Additional specic nancial objectives will increase complexity.
In GET FiT Uganda, most nancial structures were quite similar involving private equity and a group of DFI lenders.
Objectives that go beyond a nancial package that oers the prospect of ecient achievement of nancial close will
not be realized unless specic conditions and resources are dedicated to them. Examples of alternative objectives
that were discussed by various GET FiT stakeholders included: ownership shares by local communities/ individuals;
general local content requirements; minimum commercial lending tranches; minimum local funding tranches (e.g.
pension funds); rural electrication near the project, and other CSR obligations. To realize any such ambitions the
program design must incorporate them from the beginning.
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