The Challenge of Low-Carbon Development - World Bank Internet ...

Table 2.2Evaluated World Bank Renewable Energy and Energy Efficiency Projects by Rating, ProjectsInitiated 1990–2007Rating Energy efficiency New renewable energy Large hydro (>10 MW)Highly satisfactory 2 1 2Satisfactory 21 14 3Moderately satisfactory 10 4 2Marginally satisfactory 0 1 1Marginally unsatisfactory 1 0 0Moderately unsatisfactory 7 2 3Unsatisfactory 5 8 2Highly unsatisfactory 1 1 0Total number 47 31 13Percent moderately satisfactory or better 70 65 62Source: IEG based on ICR reviews.Note: MW = megawatts.Two-thirds of these projects were rated moderately satisfactoryor better, versus 72 percent of all energy projects.Energy efficiency projects fared slightly better thanrenewable energy projects. Just over half of such projectsin low-income countries 3 were marginally satisfactory orbetter, compared to 70 percent in higher-income countries.China had 13 projects, the largest number of any country,and all were rated marginally satisfactory or better. Aboutone-third of this portfolio was in energy efficiency projectsin transition countries, with a 64 percent success rate.Performance of evaluated IFC investment projectsDuring the period of fiscal 1990–2008, IFC made commitmentsto 102 investment projects in support of renewableenergy or energy efficiency, of which 81 were committedduring fiscal 2005–08. Because IFC projects are evaluatedon a sample basis after five years of operation, onlyeight projects have been evaluated, all committed betweenfiscal 1992 and 1999. Five received satisfactory ratings.Twenty-six ongoing projects, committed during fiscal1992–2008, have internal monitoring data available. 4 Ofthese ongoing projects, 22 were reported as progressingsuccessfully.The 2003–08 portfolio of WBG investment projectsTo assess the portfolio of recently initiated (2003–08) projects,IEG reviewed and validated a database of low- carbonproject components assembled by the Bank’s energyanchor (appendix G). In some cases, IEG revised the classificationor funding amount of a component designatedas “low carbon.”The WBG has three arms with different products. Two ofthose arms (the World Bank and IFC) can use both traditionalfinance and new, environmentally oriented finance:GEF grants and carbon payments.Table 2.3 breaks down commitments by technology and bywhether financed traditionally or together with environmentalfinance. Off-grid investments are about 11 percentof this $8 billion low-carbon portfolio and roughly one-fifthof all rural energy access commitments. Grid-connectedrenewable energy accounts for $3.3 billion, compared with$2.9 billion for energy efficiency. Projects that use financialor other intermediaries account for about 20 percent of thisportfolio.Projects with exclusively traditional financing (InternationalBank for Reconstruction and Development [IBRD],International Development Association [IDA], and IFC)—that is, without even small amounts of GEF or carboncofinancing—comprise 70 percent of the 2003–08 portfolioand more than three-quarters of the grid-connectedrenewable energy portion. Nontraditional finance is mostimportant in financial intermediation for energy efficiency,reflecting a perception that risk aversion is deterring profitableefficiency loans.Renewable Energy | 13