RFP3-15

Global LEAP-RBF Economic & Incentive Program Design Consulting

Introduction

CLASP is an international non-profit organization whose mission is to improve the environmental and energy performance of the appliances and related systems we use every day, lessening their impacts on people and the world around us. CLASP develops and shares transformative policy and market solutions in collaboration with global experts and local stakeholders.

CLASP serves as the Operating Agent for the several programs of the Global Lighting & Energy Access Partnership (Global LEAP), an initiative of the Clean Energy Ministerial (CEM) to catalyze and support commercial markets that deliver clean energy access products and services to un- and under-electrified communities throughout the developing world. Global LEAP does this by developing product quality assurance frameworks, promoting demand-side super-efficiency, and encouraging collaboration among donors and other institutions.

To support a forthcoming Global LEAP program that will provide incentives to off-grid energy companies making large procurements of and selling certain off-grid appliances, CLASP is seeking an individual or team with appropriate economic analysis and incentive design expertise to advise on how best to calculate (i) appropriate and effective incentive prices, (ii) the market failure that the program and incentives will address, and (iii) a cost-benefit analysis. These analyses will figure centrally in program scoping efforts, as well as an important early deliverable: the program’s “inception phase report.”

Information on the background, scope of work, reporting, and timeframe for implementation of the project is provided below, along with instructions for proposal submission and evaluation.

Project Background

Distributed (“off-grid”) clean energy technologies – like solar portable lanterns (SPLs) and light kits, solar home systems (SHSs), and renewable mini-/micro-grids – offer cost-effective, high-quality, and reliable modern energy services to the billions of under-electrified consumers at the base of the economic pyramid (BoP). These modern energy services displace dirty, pre-modern fuels such as kerosene and diesel, driving positive global health and environmental impacts, as well as socioeconomic development.

Quality assured, highly energy efficient, and appropriately designed off-grid appliances like light emitting diode (LED) lighting, televisions (TVs), fans, and refrigerators accelerate markets for off-grid clean energy systems like SHSs and mini-grids. High quality off-grid appliances create demand for clean energy systems, while energy efficient appliances reduce energy supply investment requirements and maximize the usefulness of every unit of energy generated. As such, these appliances are essential to the development of off-grid markets.

Despite the potential of appliances to spark off-grid markets and move BoP consumers up the energy ladder, the market for these appliances is underdeveloped, disorganized, and difficult for off-grid market actors to access and navigate. Both off-grid energy companies and appliance manufacturers experience challenges related to price sensitivity of BoP consumers, lack of information about products and/or the market itself, and other barriers to market entry. These market failures inhibit the development of an appliance market that meets the needs of the global clean energy access challenge.

To address these market failures and help jumpstart a badly needed competitive global market for outstanding off-grid appliances, Global LEAP is partnering with Energising Development on a multi-year program with four core components. 

  1. A series of Global LEAP Awards competitions to identify a pool of high-quality, super-efficient, best-in-class off-grid appliances (anticipated to be fans, televisions, and refrigerators);
  2. Results-based financing (RBF) incentives directed at SHS companies in one or more key off-grid economies (anticipated to be Bangladesh and one or more East African countries, e.g. Kenya) to encourage quick procurement of and clear paths to market for these appliances, as well as to foster productive long-term business relationships between SHS companies and appliance manufacturers;
  3. Industry matchmaking and market development to heighten program engagement and accelerate its outcomes, as well as to address policy, financial, and institutional barriers to market development; and
  4. Monitoring and evaluation to validate RBF incentive payments, track the outcomes of the program, and inform program refinements.

Scope of Work

Appropriate planning and programmatic design will be essential to this program’s success. As such, an “inception phase report” is being drafted to articulate programmatic work plans, an analysis of the global off-grid appliance market, and crucial programmatic details like incentive levels.

CLASP is seeking an individual or team with appropriate economic and incentive design expertise (“Advisor”) to advise on how best to calculate

  1. Appropriate and effective incentive levels (i.e. establishing the incentive “price finding mechanism”);
  2. The monetary values of the market failures (aka “viability gap”) that the program and incentives will address; and
  3. A cost-benefit analysis (aka “value for money”) of programmatic expenditure.

CLASP also seeks guidance and assistance with regard to the collection and interpretation of the data that will inform these calculations. These calculations will be included the inception phase report, and will directly inform the program’s design in the first year.

Reporting and Deliverables

The Advisor will be expected to work closely with CLASP to develop and deliver the following:

  • A thorough review of existing results-based financing programs’ price finding mechanism, viability gap, and value for money calculations;
  • Thorough recommendations on how to make these calculations and assistance with the construction of the spreadsheets or models needed to make them;
  • Research related to the data needed to inform these calculations; and
  • A brief report summarizing the methodologies used to make these calculations, and any assumptions.

Timeline

The Project is expected to commence in July 2015 and to be concluded within two months of inception.

Information for Potential Applicants

Companies and organizations that wish to bid on this project must first register as a CLASP Implementing Partner. Registering is easy, and can be done via the CLASP website before final submittal.

Confidentiality Statement

All data and information received from Global LEAP designees, CLASP, appliance manufacturers, or other off-grid clean energy access industry stakeholders for the purpose of this assignment are to be treated confidentially and are only to be used in connection with the execution of this assignment. All intellectual property rights arising from the execution of this assignment are assigned to Global LEAP donors and their designees. The contents of data sets or written materials obtained and used in this assignment may not be reused or disclosed to any third parties without the expressed advance written authorization of Global LEAP designees.

Selection Criteria

A committee will evaluate project and budget proposals received from respondents. Selection of qualified experts will be based upon the following criteria:

Qualifications, including:

  • Familiarity and experience with results-based financing projects and incentive design;
  • Familiarity with off-grid appliance markets, regions and cultures (i.e. Sub-Saharan Africa, South Asia, etc.);
  • Thorough understanding of off-grid consumers, products, and market characteristics and needs, and of the Global LEAP initiative and affiliated global clean energy access and development stakeholders;
  • A thorough grasp of this program’s scope, objectives and goals (current program documents will be made available upon request)

Cost proposal

Proposals will be evaluated using a Quality and Cost-Based Selection (QCBS) method, with weights of 75 percent towards team and organization experience and qualifications, and 25 percent towards proposed costs. Additional information about CLASP’s selection process is available here. Successful proposals will come in under US$25,000. 

Submittal

Interested parties should submit separate technical and financial proposals as electronic files. The file should be named as per the following example:  “Contractor Name: RFP3-15

The Project Proposal must include the following elements:

  • Biography or organizational profile
  • Examples of relevant, related work
  • CVs and related summaries of experience and qualifications of applicable staff
  • Detailed proposed timeline of deliverables and milestones

The Financial Proposal must include the following elements:

  • Detailed budget that includes a breakdown of costs for staff time and expense

If necessary for the selection process, CLASP may request additional information from any applicant.

Proposals should be submitted via the CLASP website using the “Submit Bid” button above and filling out all the requested information. The deadline for proposal submission is June 22 2015. Proposals submitted directly to anyone at CLASP will not be accepted.

All questions may be addressed to Matt Jordan at mjordan@clasponline.org. The last date for submission of questions related to this RFP is June 18 2015. We request all inquiries be made by e-mail and not by phone.