3rd Special ERG Call on Climate Change

The Private Enterprise in Low-Income Countries (PEDL) program invites proposals on projects aimed at understanding the role of firms in addressing climatic and environmental challenges.

Proposals responding to this call should make clear how the research addresses firms. Projects may examine the role of firms as individual entities or the interaction of firms within markets. PEDL does not focus on agriculture, although they are open to projects exploring firm-farm interactions through input and output markets.

PEDL particularly encourage proposals related to adaptation and resilience in the face of climate change, and projects on mitigating pollution and improving local environmental conditions. They also welcome proposals on climate change mitigation, particularly proposals that provide evidence on the costs and benefits of mitigation to firms in PEDL-focus countries.

The Exploratory Research Grant (ERG) program is aimed at seeding new research agendas that might lead to more extensive projects as they develop. PEDL supports this scaling through Major Research Grants (MRGs), and through a Scale-up Grant program that aims to bridge the gap between the initial work of an ERG and a full-scale project. Depending on the final allocation of research budgets for the UK’s 2023 fiscal year, they presently expect to have at least one MRG call in 2022, and another in 2023. They therefore encourage ambition in the proposals, even if this call only allows for pilots or other initial steps in developing the agenda.

Topic Areas

Topic areas and sample research topics:

• Energy: The private sector plays a role in developing a reliable electric grid necessary to meet growing demand of firms and households. There is an interaction between investment and regulatory policy, especially as the latter relates to long-term power purchase contracts.

• How can renewables and storage support the development of reliable electricity grids?

• What are the sources of regulatory and investment risk for private sector investment in renewables, and how can these be mitigated?

• Transport: Adoption of electric vehicles is increasing in high-income countries, and investment in electric motorcycles and three-wheelers in increasing the Africa and South Asia. But electric mobility is only one aspect of transport. Mass transits systems and streamlining transport logistics are also very active areas in PEDL-focus countries.

• What are the challenges to and benefits from adoption of electric transport?

• What is the role of the private sector in mass transit?

• What are the constraints to increasing efficiency of transport of goods?

• Industrial Production: Energy use in industrial processes contributes around one-quarter of CO2 emission globally. From a development perspective, the effect of industrial production on air quality is at least as important. Brick kilns alone are estimated to be responsible for as much as 58% of PM2.5 in Dkaka in the dry season.

• What is the role of the innovation and technology adoption is reducing emissions of both PM 2.5 and GHGs?

• How can policy interact with the private sector to achieve results?

• What determines the uptake of energy-saving innovations by private sector firms?

• Trade: GHG emissions of producers of exported goods may be thought of as induced by the final consumers of those goods. Tariffs in both producing and consuming markets may skew prices of carbon-intensive and non-intensive goods.

• How do import policies impact production decisions and technology adoption?

• How are climate mitigation demands of consumers in higher-income countries transmitted through buyers to producers in lower-income countries?

• Markets for risk: Insurance is an important factor in resilience at the level of the farmer or firm. Insurance may also be necessary to encourage investment in capital-intensive sectors like grid-scale renewables.

• How are the effects of climate change distributed across firms of different sizes, sectors and locations?

• What innovations are required in local insurance markets to mitigate the increased risks arising from climate change?

• In the absence of full insurance markets, what are the adaption strategies of firms in PEDL-focus countries?

• Innovation: Innovation will play a major role in the resolution of either of these crises.

• What are the constraints to adoption of climate friendly technologies, be they internal (e.g., management) or external (e.g., finance, market prices) to the firm?

• Is green tech imported or produced domestically?

Funding Information

• The budget limit for ERGs is £40,000. These grants will fund research assistance, data collection and new surveys in LICs, and (if necessary) teaching buyouts for the principal investigator.

• ERG projects typically run for 12 months.

Eligibility Criteria

• Please note that an important criterion for funding of proposals is the relevance to policy in LICs and other eligible countries as defined by the PEDL Program.

• Proposals for projects outside the focus countries should make a clear case for the relevance of the research to policy in lower-income countries, and also justify why the research is feasible only in non-target countries.

• Note that they are currently unable to fund projects located in Myanmar and Palestine.

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