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The Paris Agreement on climate change is anchored in plans – known as Intended National Determined Contributions, or INDCs -- to cut greenhouse gas emissions submitted by individual countries. As countries put policies in place to fulfill their INDCs, the Agreement also lays out requirements to regularly monitor implementation and progress. Performance indicators for greenhouse gas (GHG) mitigation policies can support this by assessing the implementation of key policies that underlie the INDCs. For example, if a country aims to reduce its GHG emissions by 20 percent below 2000 levels and has put in place a set of policies to achieve it, the use of performance indicators can allow regular tracking of policy implementation and assess progress towards realizing the target.

Performance indicators are specific, measurable metrics that support systematic tracking of how policies are being implemented and whether they are on course to achieve their intended goals and objectives. Many factors, such as lack of financial resources and lack of coordination across implementing agencies, can hinder adequate implementation of policies and the realization of goals. If policy implementation is tracked regularly through performance indicators, these factors can be identified in a timely manner. Governments can address them and make necessary modifications in policy design and implementation to increase the likelihood of achieving the policy’s goals.

A country interested in monitoring its renewable energy policy can track indicators such as:

  • Funds allocated and funds spent on various technologies (solar, wind, hydro and biomass)

  • Funds available to augment domestic solar panel manufacturing capacity

  • Number of renewable energy certificates issued

  • Total electricity generation by source (wind, solar, etc.)

  • Total capacity of renewable energy installed and generated

  • Number of financing institutions and volume of lending dedicated to cleaner energy sources

  • Number of technology and service providers for cleaner energy

  • Policy-driven changes in GHG emissions

  • Share of households without electricity

  • Jobs in renewable energy sector as a percentage of total employment

The new working paper Monitoring Implementation and Effects of GHG Mitigation Policies provides guidance to develop indicators. It outlines three main steps necessary to develop meaningful, relevant indicators to track mitigation policy implementation:

  1. Formulate a list of possible indicators to track policy implementation and assess progress made toward desired impacts. It is important to clearly articulate objectives that fulfill the overall broad goal of the policy because these can help identify performance indicators to be monitored. Policies are often tracked by monitoring only discrete activities and direct outputs, rather than with indicators that also track effects. The use of different types of performance indicators provides useful information to assess both policy implementation and policy effectiveness.

  2. Prioritize and select performance indicators from the list, based on a set of guiding principles. These include policy relevance, variety, data quality and availability, comparability, clarity and timeliness.

  3. Identify data sources and monitoring methods for each performance indicator to ensure a high degree of quality. Availability of data, along with the cost of gathering data over time, are two key issues to be considered here. Data collection involves money and policymakers should collect only what is necessary to adequately monitor a policy. The process of data collection begins with establishing data needs for each indicator and addressing issues such as what specific data are needed, can existing data be used, and what methods can be used to collect new data.

Performance indicators help observe progress, trends, and short-term and long-term effects related to policies. Careful development of indicators considering linkages between implementation activities and their desired effects can provide valuable insight into the factors hindering or facilitating progress. They can thus support decision-making and help policymakers steer the implementation process and make necessary adjustments for desirable results.