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Green Cities: a Sustainable Urban Future in Indonesia (Financed by the Government of Australia) (Part 1 of 2)

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Green Cities: a Sustainable Urban Future in Indonesia (Financed by the Government of Australia) (Part 1 of 2) Technical Assistance Consultant’s Report Project Number: 46380-005 October 2016 Indonesia: Green Cities: A Sustainable Urban Future in Indonesia (Financed by the Government of Australia) (Part 1 of 2) Prepared by Robert van der Hoff, John Sutton, and Niels van Dijk Urban Solutions BV in association with PT Ciriajasa Rancangbangun Mandiri (CRM) Indonesia) Indonesia For Asian Development Bank This consultant’s report does not necessarily reflect the views of ADB or the Government concerned, and ADB and the Government cannot be held liable for its contents. (For project preparatory technical assistance: All the views expressed herein may not be incorporated into the proposed project’s design. CURRENCY EQUIVALENTS (as of 20 October 2016) Currency Unit – Indonesian rupiah (IDR) IDR1.00 = $ 0.0000766 $1.00 = IDR13050 ABBREVIATIONS ADB – Asian Development Bank AfD – Agence Française de Développement AFM – Alternative Financing Mechanisms APBD – Anggaran Pendapatan dan Belanja Daerah (regional/municipal budget) APBN – Anggaran Pendapatan dan Belanja Nasional (national budget) APEKSI – Asosiasi Pemerintah Kota Seluruh Indonesia (association of Indonesian municipalities) ASEAN – Association of South East Asian Nations AusAID – Australian Government Overseas Aid Program BAPPENAS – Badan Perencanaan Pembangunan Nasional (national development planning BDA – Batam Development Authority BIFZA – Batam Indonesia Free Zone Authority BLU – Badan Layanan Umum (public service agency) BLUD – Badan Layanan Umum Daerah (regional public service agency) BOT – Build Operate Transfer BRT – Bus Rapid Transit BUMN – Badan Usaha Milik Negara (state owned enterprise – SOE) CAPEX – Capital Expenditure CBO – Community Based Organization CDIA – Cities Development Initiative for Asia CDTA – Capacity Development Technical Assistance CIIPP – City Infrastructure Investment Programming and Prioritization CPS – Country Partnership Strategy CSR – Corporate Social Responsibility DAK – Dana Alokasi Khusus (special allocation fund) DAU – Dana Alokasi Umum (general allocation fund) DBH – Dana Bagi Hasil (revenue sharing fund) DED – Detailed Engineering Design DGHS – Directorate General of Human Settlements, Ministry of Public Works DMF – Development Monitoring Framework DKP – Dinas Kebersihan dan Pertanaman (city sanitation and landscaping agency) DPR – Dewan Pewakilan Rakyat (national parliament) DPRD – Dewan Perwakilan Rakyat Daerah (regional parliament) DSCR – Debt Service Coverage Ratio 3E – Environmental, Economic, Equitable EA – Executing Agency ESCO – Energy Savings/Service Company FAR – Financial Analysis Report FS – Feasibility Study GCAP – Green City Action Plan (see also RAKH) GCP – Green Cities Program (also: Green City Profile) GIS – Geographic Information System GOI – Government of the Republic of Indonesia GT – Green Team IA – Implementing Agency IIF – Indonesia Infrastructure Fund IIGF – Indonesia Infrastructure Guarantee Fund IMT-GT – Indonesia Malaysia Thailand Growth Triangle IndII – Indonesia Infrastructure Initiative IPAL – Instalasi Pengolaan Air Limbah (see also WWTP) IPP – Independent Power Producer IUWASH – Indonesia Urban Water, Sanitation, and Hygiene JICA – Japan International Cooperation Agency KfW – Kreditanstalt für Wiederaufbau (German Development Bank) FGD – Focus Group Discussion KSPPN – Kebijakan dan Strategi Pembangunan Perkotaan Nasional (National Urban LCF – Livable City Framework LGE – Local Government Enterprise LGOE – Local Government Owned Enterprise MDG – Millennium Development Goals SPV – Special Purpose Vehicle SWM – Solid Waste Management TA – Technical Assistance TOR – Terms of Reference UNDP – United Nations Development Programme WSS – Water Supply and Sanitation WTE – Waste to Energy NOTE In this report, "$" refers to US dollars. TA-8518 INO: Green Cities: A Sustainable Urban Future in Indonesia FINAL REPORT TA-8518 INO: Green Cities A Sustainable Urban Future in Indonesia 2 - Capacity Development DOCUMENT SIGN OFF Report Title: Final Report Client Name: Asian Development Bank (ADB) Project Name: TA-8518 INO: Green Cities: A Sustainable Urban Future in Indonesia Document Number: US2016/INO8518/FR Client Contract Number: 112365-S52413 This Consultant’s report has been prepared by Urban Solutions BV in association with PT Ciriajasa Rancangbangun Mandiri (CRM) Indonesia. The report does not necessarily reflect the views of ADB, Australian Aid, or the Government concerned, and ADB, Australian Aid, and the Government cannot be held liable for its contents. File No: US2016/INO8518/FR Issue No: A Date: 20/10/16 Sign Off Originator Checker Approver Client Approval (if required) Print Name: Robert van der Hoff John Sutton Niels van Dijk Signature: Date: 1 Contents Executive Summary .......................................................................................................... 10 1 Introduction ................................................................................................................ 14 1.1 Background to the CDTA ............................................................................................ 14 1.2 Structure of the Report ................................................................................................ 15 2 Preliminary Work to Define the Approach to Green City Action Planning ............. 16 2.1 Regulatory Framework for Action Planning ................................................................. 16 2.2 City Readiness and Capacity Assessment .................................................................. 17 2.3 A Need for Result-Oriented Action Planning ............................................................... 18 2.4 Literature Review ........................................................................................................ 18 2.5 Summary: What is a GCAP? ....................................................................................... 19 2.5.1 Core Principles of Green City Action Plans .......................................................... 19 3 Approach and Methodology ...................................................................................... 20 3.1 GCAP facilitation ......................................................................................................... 20 3.2 Finance Methodology .................................................................................................. 29 3.2.1 Financial Assessment Report (FAR) .................................................................... 29 3.2.2 Alternative Financing Mechanisms (AFM) ........................................................... 31 4 Process and issues faced in capacity development ................................................ 34 4.1 Methodology Development and application ................................................................. 34 4.1.1 Purpose ............................................................................................................... 34 4.1.2 Development ....................................................................................................... 34 4.1.3 Practice ............................................................................................................... 34 4.1.4 Summary of Methodology Development and Application ..................................... 35 4.2 Facilitation of the TA ................................................................................................... 36 4.2.1 Language ............................................................................................................ 36 4.2.2 Schedule ............................................................................................................. 36 4.2.3 Management of the TA ........................................................................................ 37 4.3 Capacity Development ................................................................................................ 37 4.3.1 Institutional Capacity Development, Urban Management Partnerships ................ 38 4.3.2 Issues faced ........................................................................................................ 40 4.3.3 Planning Capacity Development .......................................................................... 41 4.4 Brief Summary of the process and issues by City ....................................................... 42 4.4.1 Batam .................................................................................................................. 42 4.4.2 Kendari ................................................................................................................ 43 4.4.3 Malang ................................................................................................................ 43 4.4.4 Medan ................................................................................................................. 43 2 4.5 Developing financing capacity ..................................................................................... 43 5 Outputs ....................................................................................................................... 46 5.1 Intermediate outputs ................................................................................................... 46 5.2 The Green City Action Plans (GCAP) .......................................................................... 48 5.2.1 Action Plans ........................................................................................................ 50 5.2.2 Generic actions ..................................................................................................
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