Department Of Environmental Affairs Funding

Green Fund

Introduction, background and objectives

The Government of South Africa through the Department of Environmental Affairs (DEA) has set up a Green Fund to support the transition to a low carbon, resource efficient and climate resilient development path delivering high impact economic, environmental and social benefits. The allocation of R800m represents the initial resources available for disbursement by the Green Fund. The DEA has appointed the Development Bank of Southern Africa (DBSA) as the implementing agent of the Green Fund.

The Green Fund website provides access to more information on initiatives across these three focus areas in a phased approach.

Objective of the green fund

The Green Fund aims to provide catalytic finance to facilitate investment in green initiatives that will support poverty reduction and job creation. Importantly, the Fund will only support initiatives which would not have been implemented without its support. The Green Fund is additional and complementary to existing fiscal allocations supporting the transitioning of the South African economy to a low-carbon, resource efficient and climate resilient growth path.

Due to its focus on innovative projects, unless a strong case is made for the coverage of a funding or financing gap, the Green Fund will not support such projects.

The Green Fund will respond to market weaknesses currently hampering South Africa’s transition to a green economy by:

promoting innovative and high impact green programmes and projects
reinforcing climate policy objectives through green interventions
building an evidence base for the expansion of the green economy, and
attracting additional resources to support South Africa’s green economy development.

Funding windows of the green fund

The Green Fund has identified three (3) thematic funding windows which will contribute to the transition to green economy.

Green Cities and Towns (GCT)

Local government, through public sector procurement and alignment of spending on infrastructure and services, with environment performance indicators, can play a significant role in generating the demand for green products and services. This in turn can creat greater localisation of green technologies. By assisting in implementation at local government, the Green Fund can play a role in catalysing significant levels of both public and private sector investment in the green economy.

The vision of the GCT window is to strive for well run, compact and efficient cities and towns that deliver essential services to their residents, utilising available natural resources efficiently and sustainably.
Focus areas:

Sustainable transport
Sustainable Waste management & recycling
Renewable energy, including off grid and mini grid
Sustainable water management
Energy Efficiency & Demand Side Management
Sustainable human settlements, the built environment and green buildings
Ecosystem services

Eligible applicants: this window is open to proposals from municipalities, municipal entities, suppliers to municipalities and small and medium enterprises. For private sector applicants, confirmation of support from municipality must be provided in the application.

Low Carbon Economy(LCE)

The decoupling of economic growth from its impact on natural resources will be driven by private sector efforts to lower environmental impact and resource consumption. This can be achieved through clean production methods and other climate change mitigation and adaptation measures. These include interventions targeting industrial efficiency and the carbon intensity of the economy including energy efficiency, reducing pollution from industrial processes, waste management and reuse of by-products.

The vision of the LCE window is to strive towards a low carbon growth trajectory in line with national climate change policy principles.
Focus Areas:

Energy efficiency
Renewable energy
Rural energy including off grid and mini grid
Biogas and biofuels
Sustainable transport
Industrial cleaner production and consumption projects

Eligible applicants: this window is open to proposals from the private sector (including small and medium enterprises), research and non-governmental organisations.

Exclusions: The fund will not consider proposals from large Renewable Energy Independent Power Producers, nor from bio-fuels projects that utilise invasive plants and food sources as feedstock.

Environmental and Natural Resource Management (NRM)

The protection of biodiversity and securing the sustainable delivery of ecosystem services is the primary focus of this Window. These include interventions targeting ecosystem based adaptation to climate change that could drive rural development models. Managing and reducing the impact of agriculture and land use changes through demand management and resource conservation will be supported.

The vision of the NRM window is to strive for protected and conserved resources for sustained ecosystem services to support South Africa’s development path.
Focus areas:

Payment for Ecosystem Services (PES) projects
Biodiversity Benefiting businesses, including sustainable farming
Land use management and models
Rural adaptation projects and plans

Eligible applicants: this window is open to proposals from the private sector (including small medium enterprises), non-governmental organisations, universities and research institutions, and community based organisations.

Exclusions: For private sector applicants, cost of conversion from conventional agriculture to sustainable agriculture will not be supported.

Eligibility criteria

Each application will undergo an initial screening to assess suitability in terms of the Green Fund’s objectives. All applications will be subjected to the following eligibility criteria which they must meet:

Relevance: match to the funding window and focus areas therein
Innovation: the project is new and unique in the green economy space. This innovation can relate to any of the following aspects: technology, business model, institutional arrangements, or financing approach.
Additionality: the project cannot proceed without the Green Fund’s financial support and a funding gap should be demonstrated.
Ability to scale up and/or replicate: the project has the potential to be rolled out to other sites and/ or to be implemented at a large scale.

Institutional requirements

At the point of application, applicants need to ensure the following (where applicable):

Registered legal entity or identifiable natural persons (evidence to be attached)
Established bank account at a registered South African financial institution (evidence to be attached)
Tax clearance certificate (evidence to be attached)
No adverse audit findings or disclaimer of audit opinion in last 2 years
Not barred from participating in government procurement
Not credit blacklisted through a default judgement or an un-rehabilitated insolvent

Project phases

The proposed projects will be engaged in one or a combination of the following project development stages:

Project Development Phase (including feasibility studies)
Pilot and Demonstration Projects
Project implementation

Green Fund Training Programme

From 9 to 13 March 2015, more than 50 officials from provincial and local governments in South Africa gathered at the Vulindlela Academy, Development Bank of Southern Africa’s (DBSA), Midrand, South Africa to participate in the second Green Fund training course on “Green jobs for sustainable development: concepts and practices”.
Follow the link below for more on the provinces benefiting from Green Jobs training programme for South Africa.
>> Provinces benefit from Green Jobs training programme for South Africa

Related media

South Africa’s Green Fund: Financing the transition towards an inclusive green economy

The Green Fund aims to attract foreign investment and additional national investments into the greening of the South African economy to complement existing financial support. The fund thus actively seeks international and local partners from the private and public sectors.

download green fund impact study report…