Vulnerable groups, such as poor people in developing countries, are often hit hard by the effects of climate change since they lack the resources needed to cope or adapt to the changing environment. To conduct poverty reduction without compromising on the environment, the Dutch government defined a variety of policy measures. One is the so‐called Daey Ouwens Fund, established to implement small scale renewable energy projects in the poorest countries of the world. This Fund aims to contribute to Millennium Developing Goal 1, eradication of extreme poverty, and MDG 7, ensuring environmental sustainability. This paper describes the methodology developed to get a better understanding of the socioeconomic and environmental impact of projects to be implemented under the Daey Ouwens Fund. This methodology uses the multi level “Strategic Niche Management (SNM)” framework to systematically assess drivers and barriers crucial in process of innovation. For three selected projects, indicators are defined within this SNM framework, based on the MGD 1 and MGD 7 and the local socio‐economic situation as well as the existing energy system and the innovative renewable energy technology of the project. These indicators are translated into sets of questions to be quantified through a limited number of semi‐structured interviews with key persons and questionnaire inquiries of a large number of potential end‐users. The data of the conducted baseline study will be presented in this paper to provide an overall picture of the current socio‐economic situation and the energy consumption in the areas were the three selected project are going to be implemented. Based on these data and the SNM framework, an overview will be provided of drivers and barriers for the projects and the expected contribution to MDG 1 and 7. The methodology will be assessed and adapted for the impact monitoring assessment that will be held in 2013.