PNG: Economic Analysis including Carbon Pricing, Trans-National Highway

PNG: Economic Analysis including Carbon Pricing, Trans-National Highway

Please note that the deadline is based on Korean Standard Time Zone (KST, UTC+9)

INTRODUCTION TO GGGI

The Global Green Growth Institute (GGGI) is a treaty-based international, inter-governmental organization dedicated to supporting and promoting strong, inclusive and sustainable economic growth in developing countries and emerging economies. To learn more please visit about GGGI web page.

Project background

Papua New Guinea (PNG) is among the countries most vulnerable to the impacts of climate change. Its road network is a lifeline for economic growth, social connectivity and access to essential services, and it is increasingly compromised by intense rainfall, flooding, landslides and related hazards. The heavy rains of 2024 alone caused damages estimated at PGK 500 million (approximately USD 125 million).
With funding from the Australian Department of Foreign Affairs and Trade (DFAT), GGGI is implementing the Climate Finance Initiative for Resilience and a Sustainable Transition (Climate FIRST), developed under the PNG–Australia Climate Change Action Plan (PACCAP), in close collaboration with the Climate Change and Development Authority (CCDA).
Under Climate FIRST, GGGI is supporting the PNG Department of Works and Highways (DoWH) to prepare a climate-resilient road investment in Morobe Province (the Trans-National Highway 9 Mile to Bulolo Resilient Road Project) for potential financing by the Asian Infrastructure Investment Bank (AIIB). To make the best use of resources, the work concentrates on a selected first section of approximately 25- 45 km, agreed in consultation with DoWH and AIIB, to be prepared to the required standard by December 2026 as a model for the rest of the corridor.
All deliverables under this assignment are intended for DoWH and AIIB. The governing technical and safeguard context is therefore the AIIB Environmental and Social Framework (ESF, June 2024), the AIIB Procurement Policy (as revised through June 26, 2024) read with the Directive on Procurement Instructions for Recipients (July 26, 2024), the DoWH Climate Change Risk and Vulnerability Assessment (CCRVA) Framework (May 2025) and its Guidelines, and the DoWH Climate-Responsive Manuals 1–5 (Design; Construction; Maintenance; Operations; Rehabilitation and Decommissioning). GGGI procurement and contracting processes follow GGGI rules and templates.
A central mandate of this work is capacity building: GGGI teams work alongside DoWH, Conservation and Environment Protection Authority, CCDA and the PNG National Weather Service (PNGNWS), so that lasting technical capability remains within PNG institutions after the project ends.

Objectives of the assignment

To achieve the project objectives, GGGI is looking for a competent individual consultant (hereinafter referred to as the “Consultant/Service Provider”) to prepare a robust, transparent, and reproducible economic appraisal of the selected road section of the Trans-National 9 Mile-Bulolo Resilient Road Project. The assignment will assess the economic viability of the proposed investment, incorporate the economic valuation of project-related greenhouse gas (GHG) impacts through shadow carbon pricing, assess the economic implications of relevant climate adaptation measures, and provide the required economic analysis inputs for AIIB project decision-making and appraisal.
The economic analysis is expected to be completed within 3.5 months (November – February December 2027), with an interim analysis expected in early October 2026. It will subsequently be updated as project design, cost, climate risk and vulnerability assessment (CRVA) and GHG inputs become available, with final outputs targeted for end of January 2026.

Deliverables and Payment schedule

Scope of Work

Task 1 – Economic cost-benefit analysis

• Prepare an economic cost-benefit analysis of the proposed road investment in line with AIIB’s Guidance Note on Cost-Benefit Analysis of Projects, using appropriate with-project and without-project scenarios including assumptions regarding existing road conditions, traffic growth, road maintenance, travel speeds, vehicle operating costs, and other relevant parameters such as the appraisal period and economic discount rate agreed with GGGI and AIIB at inception.
• Estimate the principal economic costs and benefits of the project and calculate key economic indicators, such as EIRR and ENPV. Key economic indicators shall be reported both with and without the evaluation of GHG impacts (shadow carbon pricing).
• Review and apply relevant project inputs, including traffic forecasts, investment and maintenance costs, and other assumptions required for the economic analysis.
• Undertake appropriate sensitivity and switching-value analysis to assess the robustness of the project’s economic viability.
• Where data permits, present the distribution of project economic benefits across affected groups, including gender-disaggregated considerations, consistent with the expectations of AIIB’s Gender Action Plan at appraisal.
• Where relevant and based on available information consider potential safeguarding risk and their implications with project cost, benefits and access in consistent with the expectations of AIIB Environmental and Social Framework.

Task 2 – Shadow carbon pricing

• Incorporate the project’s GHG impacts into the economic analysis based on GHG emissions impact estimated by the Consultant/Service Provider under an agreed methodology, to be reconciled with the outputs of the separately commissioned ex-ante GHG accounting assessment once available*.
• Monetize relative GHG emissions using an agreed shadow carbon price consistent with AIIB practice, applying the shadow carbon price recommended High-Level Commission on Carbon Prices in line with AIIB’s methodology for Assessing the Alignment of AIIB Investment Operations with the Paris Agreement (criterion SC5) including low- and high-bound sensitivity. Present the effect of carbon pricing transparently within the economic analysis and test relevant alternative assumptions where appropriate.
• Ensure consistency of the baseline scenario, appraisal period and key assumptions between the economic analysis and the GHG assessment.

* The Consultant will estimate the GHG emissions impacts required for the economic analysis, based on available project information and an agreed methodology, and apply the relevant shadow carbon price to quantify the associated economic costs or benefits. The analysis will subsequently be updated, as necessary, to ensure consistency with the results of a separate ex-ante GHG accounting assessment.

Task 3 – Economic assessment of climate adaptation measures

• Assess the economic implications of the climate adaptation and resilience measures identified through the CRVA and climate-proofing/design work.
• Consider the incremental costs and economic benefits of relevant adaptation options and provide economic inputs to their prioritization.
• Ensure consistency with the adaptation costs and climate-proofing measures identified under related project preparation workstreams.

Task 4 – Integration and coordination

• Coordinate with the GGGI project team, DoWH, AIIB and relevant consultants undertaking related project preparation assignments, when needed.
• Ensure consistency across relevant project assumptions and incorporate updated project inputs as they become available.
• Participate, as required, in discussions with project economist and relevant specialists and respond to review comments in a timely manner.

Task 5 – Reporting and economic model

• Prepare a transparent and reproducible Excel-based economic analysis model and accompanying report suitable for AIIB project appraisal.
• Provide an interim analysis based on information available at the time and update the model and report as subsequent project inputs become available.
• Submit final outputs incorporating comments from GGGI, DoWH, and AIIB.

OUTPUT / DELIVERABLE

SCOPE OF DELIVERABLES

PERCENTAGE

OF MAXIMUM AMOUNT

DUE DATE

1. Inception Report and Economic Analysis Framework

Methodology, review of available data and assumptions, proposed analytical framework, data gaps, coordination arrangements, and detailed workplan.

15%

15 calendar days from contract signing

2. Interim Economic Analysis and Model

Initial economic model and interim cost-benefit analysis based on available project inputs, including preliminary economic viability results and sensitivity analysis.

40%

40 calendar days from contract signing

3. Final Economic Analysis Package and Report

Final updated economic analysis report and Excel model incorporating available final cost, design, and CRVA inputs; shadow carbon pricing using the separate GHG assessment outputs; and sensitivity and switching-value analysis, distributional and gender considerations where feasible; key assumptions and limitations; and clear conclusions and recommendations regarding the economic viability of the proposed investment.

45%

60 calendar days from contract signing

All reports and outputs must be in English, in accordance with GGGI’s formatting requirements, and submitted in hard copy, electronic, and editable MS Word and Excel formats (as applicable) along with complete sets of raw data, research materials, and interview notes.

Reporting Arrangements

• The Consultant/Service Provider’s work progress will be monitored primarily through periodic review meetings, the precise schedule of which is to be determined based on consultation with the Consultant/Service Provider, and no less than fortnightly (every 2 weeks).
• The Consultant/Service Provider will report to the GGGI PNG Country Representative / Finance Strategy Cooperation Unit Senior Assistant, and AIIB, and work day-to-day with the GGGI project team and designated DoWH counterparts, when necessary.
• Deliverables will be subject to review by GGGI, DoWH, and AIIB. The Consultant/Service Provider shall respond to and incorporate review comments within the contract period.
• GGGI and the project team will facilitate access to available project documents and relevant outputs from linked project preparation assignments. The Consultant/Service Provider shall identify and inform of material data gaps at the earliest possible stage.
• The Consultant/Service Provider is also expected to periodically produce, upon GGGI’s request, a formal progress report that includes: an overview of the project, a narrative description of project activities, detailed information on project objectives and milestones, actual achievements made against the timeline set, etc.

Suggested Methodology

The Consultant/Service Provider shall describe in its proposal its proposed approach to undertaking the economic analysis, including the economic cost-benefit analysis, assessment of climate adaptation measures, incorporation of shadow carbon pricing, sensitivity and switching-value analysis, and coordination with other project preparation workstreams. The Consultant/Service Provider shall also describe the proposed economic model, key data requirements, quality-assurance arrangements, and approach to delivering the assignment within the required project preparation timeline.

Expertise required

Competence Requirements and Allocation

• Advanced degree (Master’s or equivalent) in Economics, Transport Economics, Infrastructure Economics, Engineering, or a related field.
• Minimum 10 years of professional experience in economic appraisal of infrastructure investments, including road or transport projects.

Functional

• Demonstrated experience undertaking economic cost-benefit analysis for infrastructure projects, including use of traffic, investment cost, maintenance and other technical inputs relevant to transport economic analysis.
• Demonstrated experience incorporating GHG emissions, shadow carbon pricing and/or environmental externalities into economic appraisal; experience assessing the economics of climate adaptation and resilience measures is strongly preferred.
• Significant experience working on projects financed or supported by IFIs/MDBs, including familiarity with relevant appraisal, climate and reporting requirements.
• Demonstrated ability to coordinate with engineering, climate and other project-preparation workstreams and to develop transparent and reproducible economic models.
• PNG and/or Pacific project experience would be considered an advantage.
• Strong technical reporting and Excel modelling skills in English.

Corporate

• Understands and actively supports GGGI’s mission, vision, and values.
• Commits to team goals and works effectively across the organization with individuals of different views, cultures, nationality, gender, and age.
• Excellent problem solver.
• Exemplifies the highest standard of honesty, integrity, and professionalism.

Administrative information

Date to close is Korean Standard Time (KST). Applications submitted after the deadline will not be considered Application. Cover Letter, and CV must be sent in English. A consortium, or a firm may not be engaged for the individual consultant assignment.

Child protection – GGGI is committed to child protection, irrespective of whether any specific area of work involves direct contact with children. GGGI’s Child Protection Policy is written in accordance with the Convention on the Rights of the Child.