Description
The Asian Development Bank (ADB) launched the Air Quality Improvement Program in the Beijing-Tianjin-Hebei region in 2015 as part of a multi-year, multi-sector effort to reduce greenhouse gas emissions and local air pollution. The program consisted of several projects including (1) a green financing platform that acts as a financial intermediary to provide loans to businesses for renewable energy and energy efficiency investments; (2) financing to deploy high-technology (such as hydrogen-powered buses, smart grids, and coke gasification) to reduce pollution from transport, agriculture, and industry; (3) investment in advanced heating and cooling technologies such as waste heat utilization, geothermal district heating, and ice storage to reduce coal use (4) investment in a natural gas and biogas infrastructure to displace coal use and (5) a scale-up of the original green financial platform. ADB was looking for a consultant to assist with project documentation and to conduct economic and financial analysis of each component of the project as part of loan preparation.
Service Provided
DHInfrastructure conducted economic and financial due diligence for each project. Due diligence involved conducting a demand analysis for various clean energy services and creating a model that calculated the rate of return for each component of the project, and testing that return under different sensitivities. We identified the potential risks of each project and recommended mitigation options. We also drafted communication pieces for internal (ADB) and external audiences. For the fourth project (a Results Based Loan), we developed a monitoring and evaluation framework to link ADB disbursements to project outputs, outcomes, and impacts.