Request for Proposals: End User Subsidy Research
The Clean Cooking Alliance (CCA), hosted by the United Nations Foundation (UNF), works with a global network of partners to build an inclusive industry that makes clean cooking accessible to the three billion people who live each day without it. Established in 2010, CCA is driving consumer demand, mobilizing investment to build a pipeline of scalable businesses, and fostering an enabling environment to allow the sector to thrive. Clean cooking transforms lives by improving health, protecting the climate and the environment, empowering women, and helping families save time and money.
In recent years, the clean cooking sector has experienced considerable market growth bringing clean cooking solutions to millions of households, yet a significant share of households has been left behind. The digitalization of clean cooking business models in the past five years, notably around pay-as-you-go, remote monitoring, and digital payments, offers the promise of making clean cooking affordable and accessible to millions more. Yet, most of these business models are expected to leave out the 503 million people who are too poor to gain clean cooking access or who live in rural areas where unit economics do not create sufficient incentives for clean cooking enterprises to invest. Ensuring that no one is left behind in the transition to clean cooking, therefore, requires addressing affordability and access gaps.
Public sector actors have primarily used supply-side subsidies, which are provided directly to the enterprise, to address affordability. These subsidies include grants, concessional financing, and results-based financing schemes. Their main economic effect is to decrease the cost and risk for an enterprise to provide clean cooking access in markets that would not be within commercial reach otherwise. Supply-side subsidies indirectly bring prices down for end-users by lowering costs and enabling economies of scale.
However, supply-side subsidies cannot fully bridge the affordability gap. In clean cooking markets where demand is highly elastic, they do not ensure that all customers are able to access clean cooking solutions. Demand-side subsidies (also known as end-user subsidies) can help address the affordability gap for the most vulnerable, the vast majority of whom are in rural areas where demand is often highly elastic due to the availability of biomass at zero cost, clean cooking being an experience good, and competition between clean cooking enterprises being low. End-user subsidies can come in the form of cash transfers, vouchers, free products, and results-based financing. They can involve a donor or government providing a benefit directly to a user, who then purchases a product or service on the market, or they can involve providing a benefit to an enterprise that commits to a reduction in price.
While end-user subsidies have long been used by governments in other sectors, such as agriculture and humanitarian aid, they are still very nascent in the clean cooking sector and face a number of challenges. In spite of their benefits, end-user subsidies can pose a risk to the commercial viability of a sector through market distortions and poor financial controls. The affordability gap needs to be well understood in order to correctly set the subsidy level, but willingness to pay studies can be costly. Moreover, end-user subsidies alone can fail to provide sufficient incentives and lower the market risk for enterprises to expand within and to clean cooking markets that are not sufficiently developed. This is particularly the case for business models that rely on long streams of customer income beyond the life of the subsidy. In some cases, end-user subsidies will attract commercial enterprises, but the market will not be sustained once the subsidy has been removed. And finally, end-user subsidies can be inefficient when they fund commercial offerings that do not solve actual user needs.
This project aims to understand and address these challenges and will produce a set of lessons learned and practical guiding principles for the selection, design, and delivery of clean cooking end-user subsidies. The goal of the guiding principles will be to maximize efficiency and effectiveness of subsidies in shifting the demand curve while minimizing any distortive effects on the market. The lessons learned and guiding principles will be oriented to public sector and donor programs that seek to design and implement end-user subsidies. The project will consider different attributes of end-user subsidies, including their structure (e.g., vouchers, or discounts), delivery modality (e.g., directly to households, or through a third-party), the specific economic costs they target (e.g., electricity tariffs, or appliances), the targeted technology (e.g., LPG, or pellets), and the end-user targeting mechanisms (e.g., self-selection, or data-driven).
The project is anticipated for a duration of approximately six months, and all work will be done in close collaboration and oversight from CCA’s Evidence & Impact team and User Insights Lab, and in collaboration with partners. The consultant will be required to design and implement a research study that achieves the following objectives:
- Assess existing end-user subsidy programs for clean cooking and identify factors or end-user characteristics that could lead to improved targeting.
- Design and implement lean approach that is reusable across different contexts to surface insights on the influence of end-user subsidy targeting characteristics and delivery modalities on household willingness to pay. This approach should use tools including learning prototypes, small scale experiments, pilots, or other agile and adaptive activities.
- Develop a set of design principles for clean cooking end-user subsidies that minimize market distortion risk, and which promote development of market systems.
It is expected that the research approach will be adaptive and iterative making use of prototypes, discrete choice experiments, and other approaches to reveal end-user preferences rather than relying solely on stated preferences captured through surveys. It is not expected that this research will include the development and implementation of rigorous experimental approaches such as randomized controlled trials, however, the outputs of this work may inform such research efforts in the future.
Submitted proposals should outline the approach, any specific analytical or disciplinary lenses that will be applied to the research, and where possible, initial hypotheses on what influencing factors or characteristics might be and how these would be tested. Proposals should include references to supporting literature where relevant.
Budgets should clearly state assumptions that are incorporated into cost and effort estimates for this work, and should outline any modularity of activities and associated costs. A detailed budget in US Dollars must be submitted with the proposal. Budget should include both pre-tax and net of tax values. The budget should include direct costs (Personnel, Fringe Benefits, Travel, Sub-Agreements, Equipment, Supplies, etc.), as well as indirect costs (overhead).
The consultant will be responsible for the following deliverables:
- Research design and workplan
- Literature review and assessment of existing end-user subsidy programs
- Development of hypotheses and research questions
- Implementation of learning activities, data collection, and analysis
- A ‘productized’ approach to surfacing insights on end-user subsidies that can be deployed in different contexts
- A set of design principles for end-user subsidies in clean cooking
- Final summary report outlining the research methodology, findings, and conclusions
- Proposed approaches that outline participatory, agile, and adaptive research approaches.
- Experience in consumer insights, behavioral economics, market systems and marketing research in low- and middle-income markets.
- Experience uncovering user insights through research, data analytics and innovation.
- On-the-ground presence in Sub-Saharan Africa with the ability to conduct action-based research.
- Industry experience in clean cooking, energy access, health, climate, gender, or other impact sectors is preferred.
- Demonstrated experience developing and maintaining effective working relationships with people, internally and externally, from a wide variety of types of organizations, cultural backgrounds, and functional expertise.
The Clean Cooking Alliance will review all written proposals and may request an interview and/or updated submission to address questions or provide clarifications. CCA will use the following criteria in our evaluation.
Weight and Evaluation Criteria:
- Approach, 40%: e.g. the framework and methodology answering the project’s key questions and outlining expected timeline and deliverables
- Capabilities and experience, 30%: e.g. expertise conducting user insights and economic research in low- and middle-income countries
- Project management, 20%: e.g. achievable action plan that will deliver the project on time and on budget
- Value for money, 10%: e.g. the proposed pricing demonstrates a competitive price and good value for the money
Intent and Disclaimer
This RFP is made with the intent to identify a consultant to deliver results as described in this RFP. UNF/CCA will rely on the Consultant’s representations to be truthful and as described. The Clean Cooking Alliance assumes it can be confident in the Consultant’s ability to deliver the product(s) and/or service(s) proposed in response to this RFP.
If the Clean Cooking Alliance amends the RFP, copies of any such amendments will be sent to all respondents to the proposal.
Proposal Guidelines and Requirements
- This RFP is open to multiple partners and is a competitive process.
- Proposals received after August 21, 2022 at 11:59pm EST will not be considered.
- The price provided should be in US dollars and should contain both pre-tax and net of tax values. If the process excludes certain fees or charges, the applicant must provide a detailed list of excluded fees with a complete explanation of the nature of those fees.
- CCA prefers a single point of contact who manages deliverables. If the execution of work to be performed by the Consultant requires the hiring of sub-contractors, the Consultant must clearly state this in the proposal. Sub-contractors must be identified and the work they will perform must be defined. Subcontractors are subject to vetting and approval of UNF/CCA.
- CCA will not refuse a proposal based upon the use of subcontractors; however, we retain the right to refuse the sub-contractors you have selected.
- Provisions of this RFP and the contents of the successful responses are considered available for inclusion in final contractual obligations.
Format for Proposals
Proposals must include applicant signature as well as a signed declaration form. Proposals must include the full legal name of applicant, as well as legal formation and ownership structure (e.g. incorporation certification, tax status and ID, etc.).
Contracting and Compliance
CCA will negotiate contract terms upon selection. A copy of the contract terms and conditions will be provided upon selection. All contracts are subject to review by the UNF’s Business Services and Budget Reporting team. The project will start upon the complete execution of the contract. The contract will outline terms and conditions, scope, budget, and applicable flow down terms. Selected recipient must comply with CCA, UNF, and funder compliance requirements. The selected recipient must also undergo detailed legal, financial, and commercial due diligence.
The Consultant understands that the Clean Cooking Alliance has chosen to solicit an RFP for consulting services, and that the Consultant’s response does not guarantee that the Clean Cooking Alliance will enter into a new contract with the Consultant or continue any current contract with the Consultant.
The Consultant agrees that Clean Cooking Alliance may, at its sole discretion:
- Amend or cancel the RFP, in whole or in part, at any time
- Extend the deadline for submitting responses
- Determine whether a response does or does not substantially comply with the requirements of the RFP
- Waive any minor irregularity, informality or nonconformance with the provisions or procedures of the RFP
- Negotiate with all Consultants UNF deems acceptable
- Issue multiple awards
- Photocopy the responses for evaluation/review
This RFP is not an offer to contract. The Clean Cooking Alliance assumes no responsibility for Consultant’s cost to respond to this RFP. All responses become the property of the Clean Cooking Alliance.
The Consultant, by submitting a response to this RFP, waives all right to protest or seek any legal remedies whatsoever regarding any aspect of this RFP.
The Consultant represents that it has responded to the RFP with complete honesty and accuracy. If facts provided in the Consultant’s response change, the Consultant agrees to supplement its response in writing with any deletions, additions, or changes within ten (10) days of the changes. The Consultant will do this, as necessary, throughout the selection process.
The Consultant understands it may receive proprietary and confidential information from the Clean Cooking Alliance during the RFP process (“Confidential Information”). The Consultant and CCA agree to not use Confidential Information for any purpose other than the Consultant’s participation in the RFP process, and to not reveal Confidential Information directly or indirectly to any other person, entity, or organization without the prior written consent of the other party. The Consultant and CCA further agree to exercise all reasonable precautions to maintain the proprietary and confidential nature of Confidential Information where it can best demonstrate its value and capacity to delivery ecosystem-wide, meaningful value.
Grounds for Exclusion
- Material misrepresentations, including omissions, may disqualify the Consultant from a contract award.
- Submissions will be rejected in the Clean Cooking Alliance’s sole discretion if it finds that the Consultant has engaged in any illegal or corrupt practices in connection with the award.
- The Consultant will be excluded from participation for the reasons below. By submitting a proposal in response to the RFP, the Consultant confirms that none of the below circumstances apply:
- The Consultant is bankrupt or being wound up, is having their affairs administered by the courts, has entered into an arrangement with creditors, has suspended business activities, is subject of proceedings concerning those matters, or is in any analogous situation arising from a similar procedure provided for in national legislation or regulations.
- The Consultant or persons having powers of representation, decision-making or control over them have been convicted of an offence concerning their professional conduct by a final judgment.
- The Consultant has been found guilty of grave professional misconduct; proven by any means which CCA can justify.
- The Consultant has not fulfilled obligations relating to the payment of social security contributions or taxes in accordance with the legal provisions of the country in which they are established, or within the United States of America, or those of the country where the contract is to be performed.
- The Consultant or persons having powers of representation, decision-making or control over them have been convicted for fraud, corruption, involvement in a criminal organization or money laundering by a final judgment.
- The Consultant makes use of child labor or forced labor and/or practice discrimination, and/or do not respect the right to freedom of association and the right to organize and engage in collective bargaining pursuant to the core conventions of the International Labor Organization (ILO).
Principal Point of Contact
Any questions about this RFP should be directed to Colm Fay firstname.lastname@example.org
Please email proposals to Colm Fay email@example.com no later than 11:59PM EST on August 21st, 2022. Proposals should be submitted as a single PDF file.
Selected consultant must comply with United Nations Foundation and funder compliance requirements.