PHASE I (2014 – 2019)
CP3 aims to increase the amount of funding in private equity for climate investments through directly funding two commercially run private equity funds with a leveraging effect of bringing on board other donors and other institutional investors. LTS provides rigorous M&E of CP3, for both accountability and learning, to inform on-going delivery and to help mitigate some of the risks associated with this highly innovative programme.
To drive low-carbon climate resilient growth in developing countries, private finance for climate friendly investments needs to be mobilized at scale, but the market remains sceptical. To test, stimulate and mobilize finance, CP3 is participating as an equity investor in two private equity funds. These investments – while expected to deliver climate and development benefits – are also expected to provide commercial returns to the UK Government. The ability to generate commercial returns is central to the CP3 theory of change – demonstrating to the market that climate investments are feasible and profitable. This will help unlock additional private finance.
This is conceptually innovative, so capturing the results and testing the original theory of change model and its underlying assumptions is critical.
LTS has supported the design and implementation of a robust theory-based monitoring and evaluation strategy for the entire CP3 programme that:
Makes recommendations to enhance the effectiveness and efficiency of the CP3 programmes and disseminates evaluation approaches and lessons learned to HMG offices and more widely.
Value and benefits
The focus is on ensuring that evidence from M&E feeds back into programming decisions and tests the design assumptions of the CP3 model – particularly important given the innovative concept of using private investment for development benefits. Lessons and evidence will be of interest to when designing new programmes in this space.
PHASE II (2020-2026)
The objective of this assignment is to assess the success of the CP3 programme in driving low-carbon, climate resilient growth in developing countries. We will capture, through on-going monitoring, the results of the programme as set out in the log frame and test the original theory of change model and its underlying assumptions. Several impact dimensions will be assessed, including among others, success in leveraging private investments for climate mitigation and adaptation, human development impacts, as well as transformational impacts such as the creation of financial infrastructure and the development of local capital markets that can help lever additional private investment. Where appropriate, opportunities for improvement will be identified and communicated on an ongoing basis to refocus efforts where necessary and to inform similar projects.
The £140 million CP3 is a highly innovative programme that uses an unusual model to deliver UK ODA which is jointly managed and funded by BEIS and DFID. The CP3 programme is built on the assumption that private finance is essential to delivering substantial developmental and climate benefits, including stronger and more responsive financial markets which are the backbone of productive and low-carbon economic systems where people can take the lead to escape poverty and improve their lives. LTS provides rigorous monitoring and evaluation (M&E) of CP3, for both accountability and learning, to inform on-going delivery and help mitigate some of the associated programme risks. Several impact dimensions will be assessed, including, among others, success in leveraging private investments for climate mitigation and adaptation, human development impacts and transformational impacts such as the creation of financial infrastructure and the development of local capital markets that can help lever additional private investment. LTS’ M&E support covers a range of activities throughout the programme cycle, including the development of baselines, indicators and milestones; the design and management of a system for monitoring financial and development impacts; and conducting reviews and evaluations to test the theory of change and, eventually, overall impacts.