port this conclusion; the reviewed projects are less than satisfactory on both counts. Half of the required subsections are missing from the majority of project documents, and most annexes contain notable weaknesses in technical quality in four out of the six specified incremental cost elements (see table 4.2). Although there are few differences in the overall technical quality of incremental cost annexes among the various Implementing Agencies and focal areas, it is clear that each has different areas of emphasis, strength, and weakness with regard to incremental cost assessment (see table 4.3). All projects are required to include a separate annex or section on incremental cost assessment Conclusion: Most project documents register low quality and compliance when measured against GEF requirements for incremental cost assessment and reporting.
in the project document, dealing individually with each of the six specified steps.1 Although almost all FSPs provide a separate section (and/or annex)
on incremental costs, this is present in only half of MSPs. A relatively higher proportion of UNDP MSPs (two-thirds) include a separate annex on incremental costs as compared to the project documents submitted by the other IAs. In specifying six required steps in incremental cost assessment, and outlining the formats that are required for reporting on them, the 1996 incremental cost policy provides a series of convenient “check boxes” which can be followed in project preparation, reflected in project documents, and assessed by reviewers. Half of these six boxes can be checked for most of the reviewed project documents (development goals/baseline, global environmental objective, alternative); the remaining three steps in incremental cost assessment (scope of analysis, costs, and process of agreement) commonly remain unreported in the majority of projects. The technical quality of assessment of the alternative, scope of analysis, costs, and process of agreement is weak—or missing altogether—in most incremental cost annexes reviewed. Key incremental cost elements and concepts are frequently misrepresented or misunderstood, or suffer from weak assessment and description; and
Table 4.2
Compliance and technical quality of incremental cost reporting (percentage of projects) Compliance/inclusion Criterion
FSPs
MSPs
Technical quality All projects
Strong/adequate
General aspects Incremental cost annex/section
96
51
76
55
Incremental cost matrix
92
44
71
56
96
48
75
63
Specific aspects Broad development goals/baseline Global environmental objective
59
6
36
80
Alternative
95
55
78
48
Scope of the analysis
36
3
22
49
Costs
96
68
84
46
0
0
0
17
Process of agreement
36
Evaluation of Incremental Cost Assessment