Improving evaluability to improve impact, is the EBRD on track? Phase 1

Evaluability Assessment of the EBRD’s Green Economy Transition

Background

This report looks at the evaluability of the GET 2.1 and the MRV system in an attempt to provide an independent view of how the EBRD is improving its ability to tell its “Green story”.

This assessment used the evaluability framework of three different levels: evaluability in principle, practice, and use.

Main findings

The GET 2.1 and the new MRV are a positive and welcome step forward towards for EBRD to become a “green Bank”. At the same time, evaluability in principle is weakened by the absence of a theory of change; the theory of change underpinning the GET is at best implicit, at worst absent.

GET 2.1 sets only two programme-level targets: the GET ratio reaching 50 per cent by 2025, and the outcome-level range for overall GHG emissions reductions. The GET ratio is a clear target, which provides a high-level benchmark to assess performance. However, there is poor link between achieving the GET ratio and delivering upon the GET objectives. In addition, the GET 2.1 includes a “performance dashboard”, which may have utility in providing a more comprehensive approach. However, at this stage, the performance dashboard contains no targets with which to benchmark performance. Nor does it appear to be in use.

In terms of evaluability in practice, the green MRV system marks a significant step forward towards establishing evaluability in practice for the Bank’s green finance. This will have a major positive impact on the Bank’s evaluability in practice of green finance operations. 

At the same time, and notwithstanding the early stage of MRV implementation, IEvD had several observations. 

1. Measuring mitigation is comparatively straightforward, but measuring adaptation is much more challenging.

2. The green MRV system is not being applied for climate adaptation investments supported through intermediated finance.

3. The Bank’s covenant system, and by extension its enforcement of the collection of green MRV data, is predicated on client reporting rather than on the quality of data coming in.

4. The organisational processes for storing data and integrating green MRV data with other processes are still in development and require careful monitoring.

5. It is not clear to what extent and how the Bank will use/report on ex-post green data, either internally or externally.

6. There is no evidence of feedback loops having been put in place to reflect on data generated by the green MRV system. There is a clear demand for reliable ex-post from donors. However, it is not yet clear whether the MRV can respond to all donor demands.

7. Questions remain on how the Bank will deal with the lack of green compliance, though requirements to report Green Project Monitoring Plan data will be covenanted in loan documentation.