Promoting energy-efficient products: GEF experience and lessons for market transformation in developing countries

The Global Environment Facility (GEF) has allocated more than $90 million over the past 10 years to eight projects promoting energy-efficient products in developing and transition countries. We review the early experience from these projects and suggest lessons relevant to market transformation programs. Based on GEF project designs, we also propose a menu of generic supply-side and demand-side interventions useful for designing and analyzing market transformation programs. Experience suggests that institutional and policy changes, leading to sustained price reductions and higher market volumes, are important outcomes for market transformation; that market impacts can appear early in programs due to increased expectations and awareness; and that projects can have a catalytic effect. We recommend eight principles for designers of future projects but caution that no single approach guarantees success.