Funding available for Climate Change Mitigation Projects

Deadline Date: February 29, 2024

Donor Name: Mitigation Action Facility

Grant Size: More than $1 million

The Mitigation Action Facility has announced a call for proposals to provide funding for most ambitious and feasible climate change mitigation projects.

In 2012, the German and United Kingdom (UK) governments jointly established the NAMA Facility, now known as the Mitigation Action Facility. Denmark and the European Union joined the programme as new Donors in 2015, along with the Children’s Investment Fund Foundation (CIFF) in 2021. At the 27th Conference of Parties (COP27) in Egypt, while celebrating the 10th anniversary of the NAMA Facility, the Board announced a name change to the Mitigation Action Facility effective from 2023 and a new spotlight on decarbonising priority sectors – energy, transport and industry.

The Vision of the Mitigation Action Facility is to accelerate decarbonisation to keep temperature rises to below 1.5 degrees Celsius by financing measures that shift priority sectors in a country towards a sustainable, carbon-neutral pathway.

The Mission is to:

• Finance innovative projects that remove specific barriers preventing sectoral decarbonisation and have strong potential for up-scaling and replication
• Deliver finance to support technical assistance (e.g. policy advice, trainings, awareness-raising, technology transfer) that enables capacity and policy development
• Unlock investment opportunities by providing tailor-made climate finance to fund projects with the potential to:
  • Strengthen country capacities to deliver carbon-neutral activities and closely align these activities with the country’s NDC, LTS and other relevant climate and development plans
  • Pilot financing models to overcome market barriers to carbon-neutral development
  • Deploy innovative technologies and approaches, which require donor financing to support national development plans
  • Boost participation of the private sector to deliver ambitious climate action

Funding Information

• Overall funding volume of the Call of up to EUR 100 million as well as an upper funding volume of EUR 25 million per project.
• Projects shall have a duration between 36 and 66 months.

Project Characteristics

• The Mitigation Action Facility aims to fund the implementation of the most promising and ambitious – while at the same time feasible – projects. The projects should have the following characteristics:
  • Projects are implemented in one of the three priority sectors of the Mitigation Action Facility – energy, transport and industry, or propose a cross-sectoral approach with a clear link to one of the priority sector. The sector(s) that a project engages with should be explicitly included in the partner country’s NDC to affirm the alignment of the project with national priorities and ensure that the project supports the implementation of NDC, is aligned with LTS and contributes overall to the UNFCCC process
  • Projects demonstrate a high level of alignment with the plans developed within the framework of the NDC Partnership (NDCP) as far as these exist. In countries, where economic advisors have been deployed with support from the NDCP, it would be desirable to link the project to the work of the advisors
  • Projects are country-driven and embedded in national development strategies and plans
  • Projects consist of a combination of policy and/or regulatory reforms and financial mechanisms. Policies should serve to create an enabling environment, whereas regulation and financial mechanisms channel financial flows into investments driving carbon-neutral development pathways. Regulation and financial mechanisms should serve to address potential barriers for investment and leverage public and private support for mitigation activities. Financial support should not be used to mitigate macro-economic risks such as exchange rate risks or the risk of inflation
  • Project funds are used to leverage additional public and/or private capital investment. A phase-out strategy for the Mitigation Action Facility support and phase-in of other sources of financing, including national financing for self-sustained long-term implementation, must be part of the project

Eligible Countries

• To apply to the Mitigation Action Facility, projects must be implemented in Official Development Assistance (ODA)-eligible countries.

Eligibility Criteria

• Applicants, ASPs and Implementation Organisation(s) will be assessed on an individual basis in the project-specific context to determine their capability and suitability as a contracting partner of the Mitigation Action Facility.
• Applicants, ASPs and Implementation Organisation(s) must:
  • Be or represent a legal entity
  • Demonstrate appropriate organisational structure and procedures
  • Have an appropriate accounting system with qualified personnel in place. It is expected that the annual budget and proper annual financial statements, annual sales and implemented budgets for the past three years will be made available
  • Have appropriate contract award procedures, which meet national legislation and international standards
  • Have appropriate internal and external control
  • Demonstrate an appropriate track record in the handling of (ODA) financing, including from (other) donors
• As government agencies, non-governmental organisations and commercial organisations (national or international) are legal entities, they can serve as Applicant, Applicant Support Partner and, later, an Implementation Organisation. It holds true even if the non-governmental/commercial organisation is located a non-ODA country as long as a proposed project is to be implemented in an ODA-eligible country. It is also possible that the APS is made up of a consortium of legal entities.
• During DPP, Implementation Organisation(s) are subject to enhanced due diligence initiated by the FGA that includes but is not limited to verification of the risk management, financial analysis, adherence to environmental, social and governance standards. The FGA might task a qualified external consultant to support the enhanced due diligence.
• Applicants, ASPs and Implementation Organisation(s) must not be subject to any of the following aspects:
  • They have entered insolvency proceedings, are having their affairs administered by the court, have entered into an arrangement with creditors, have suspended business activities, are the subject of proceedings concerning those matters, or are in an analogous situation arising from a similar procedure provided for in national legislation or regulations
  • They, or persons having the power of representation, decision making or control over them, have been convicted of an offence concerning their professional conduct by a judgment of a competent authority which has the force of res judicata (i.e. against which no appeal is possible)
  • They have been guilty of grave professional misconduct proven by any means which the contracting authority can justify
  • They are not in compliance with their obligations relating to the payment of social security contributions or the payment of taxes in accordance with both the legal provisions of the country in which they are established or those of the country where the contract is being performed
  • They, or persons having the power of representation, decision making or control over them, have been the subject of a judgment which has the force of res judicata for fraud, corruption, involvement in a criminal organisation, money laundering or any other illegal activity, where such an illegal activities are detrimental to the donor´s financial interest.

For more information, visit Mitigation Action Facility.