Climate Incentive Bridge Loans

IBank’s Climate Incentives Bridge Loans provide bridge financing for public, private, and nonprofit borrowers that anticipate receiving incentives to finance project costs, such as utility and state agency rebates, federal clean energy tax credits, and reimbursable grant funds.

Incentive Bridge Loans range from $1 million to $30 million, with maximums up to $100 million for particularly high-impact, creditworthy opportunities. They take two forms, depending on the status of the incentive.

If the incentive is earned, borrower will be eligible for a short-term bridge loan. The incentive is earned once all applicable activities are deemed complete by the incentive provider, and the borrower is awaiting incentive payment. An incentive assignment does not qualify an incentive as earned.
If the incentive is not yet earned, borrower will be eligible for an entity-backed loan secured by a revenue source or other assets. The incentive is not yet earned if any applicable activities are ongoing and have not been deemed complete by the incentive provider.

Incentive Bridge Structure

Loan Tenor: Term range is up to 24 months, extendable at IBank discretion.

Payment Schedule: IBank and the borrower will determine the loan term based on the projected incentive payment date; the repayment date will be no more than three months following the anticipated receipt of the incentive payment by the borrower. Interest will accrue from the date of closing, with principal and interest repaid at maturity. There is no penalty for prepayment.

Fees and Charges: An origination fee of 1% loan amount, paid one time at loan closing.

Collateral and Security: All borrowers must demonstrate the ability to meet standard debt service coverage requirements from net operating cash flows over a reasonable amortization term, in the event an incentive does not materialize.

Interest Rate: Rates are determined by a rate-setting methodology that is designed to achieve the program’s goals.

Projects aligned with the Underserved Community Criteria may receive an additional subsidy of 25 basis points.

Eligibility and How to Apply

Loan Eligibility: Eligible uses of funds are incentive-accruing activities aligned with eligible projects. These may include, but are not limited to, predevelopment, land acquisition, construction, working capital, equipment, materials, facilities, startup costs, and inventory.

The project, activity, or technology financed must comply with Federal Cross-Cutting Requirements and meet the Six-Factor Eligibility Criteria.

Borrower Eligibility: Public and private entities, including nonprofits.

In addition, eligible borrowers:

Must be accessing financing for a project within California or financing the general needs of any sponsor or participating party for operations or activities within California that are consistent with, and intended to further, California’s climate goals.
Demonstrate positive cash flow and minimum Debt Service Coverage Ratio.

How do I apply?

If you have a project and have assessed your eligibility based on the information above, complete the Climate Catalyst Intake Form to get started.

Complete the Climate Catalyst Intake Form

Frequently Asked Questions

IBank Climate Financing

Q: What can a potential borrower anticipate from the underwriting and evaluation process?

A: Potential borrowers are encouraged to submit information about their project via the Climate Catalyst Intake Form. The Intake Form will be used by IBank staff to assess the project’s initial alignment with available capital and, if aligned, will reach out to the potential borrower to solicit an application.

Potential borrowers can anticipate that the following information will be collected as part of the application process:

Borrower information, including operational history, key members of the team, and demonstration of authority to receive IBank financing.
Business/operating plan, including an assessment of product or service markets and anchor customers/contracts, and associated financial statements.
A capital development budget showing the anticipated costs of the development and the source of funds that will pay for these costs.
Historical financial statements and tax returns.
Representation of all current capital commitments and anticipated future participation needed for the venture to be viable.
An operating pro forma showing income and expense for a term consistent with the life of the financing.
A description of projected labor expenses, positions hired, salary, and benefit costs associated with each position.

Learn more about IBank’s application process and underwriting standards in the Climate Catalyst Program’s Criteria, Priorities, Guidelines, and Financial Products