Savings and benefits of a project would be taken into account as outlined in document on Incremental Cost Policies and Operational Interpretation (UNEP/OzL.Pro/ExCom/10/39 and its Annexes). Where the savings and benefits of the project were uncertain, the estimate of the present value should, while remaining realistic, be made conservatively. The savings and benefits must be discounted to the net present value. In cases where savings and benefits were not considered as defined in the document and its Annexes, a justification for that approach must be given to the Executive Committee by the Implementing Agency. Incremental costs would not be financed by the Fund where there was evidence of double-counting.
(UNEP/OzL.Pro/ExCom/10/40, para. 171C, 171D).
(UNEP/OzL.Pro/4/15 Decision IV/18 (section I.6).
(Supporting document: UNEP/OzL.Pro/ExCom/10/39).
The Thirteenth Meeting of the Executive Committee approved the following recommendations with regard to the issue of projects that might realize net incremental savings:
(a) the Parties and the Executive Committee have addressed the issue of savings and determined that only incremental costs should be financed with grants and projects with net savings may be funded through concessional loans. Although Fund activities currently demonstrate that projects with incremental savings are feasible (through the financing of project preparation), such projects may be good candidates for concessional loans from resources provided by the Fund or from other funding sources;
(b) it is, therefore, recommended that consideration of projects with net incremental savings might be provided through the consideration of sector strategies for each country. In such strategies, the impact of funding one company's project over another could be assessed and remedial action recommended as part of an overall sector plan that might include both grant and loan components;
(c) Implementing Agencies, regional development banks and other lending institutions should be encouraged to provide loans for those projects in Article 5 countries that lead to the phase-out of ozone-depleting substances but may not be eligible for grants from the Multilateral Fund. In this regard, feasibility studies and project proposals prepared by Implementing Agencies or bilateral donors should be made available to regional development banks and other lending institutions.
(UNEP/OzL.Pro/ExCom/13/47, para. 176).
(Supporting document: UNEP/OzL.Pro/ExCom/13/42).