In a further example of how geothermal is now successfully attracting more innovative financing, Good Carbon Co. (GCC) has closed a US$20mn loan with NY Green Bank (NYGB), to support the installation of geothermal heating and cooling systems across its housing portfolio in the Buffalo region.
The facility — the first publicly announced Investment Tax Credit (ITC) transferability bridge loan for geothermal heating and cooling technology — allows GCC to further accelerate its mission of developing deeply decarbonised affordable housing.
It is expected to finance around 25 geothermal systems at affordable multifamily housing properties in the area, in New York State.
“This initiative demonstrates how innovative financing can accelerate the transition to clean, equitable energy,” said Adam Serbert, GCC’s President and CEO.
“By pairing federal Investment Tax Credits with sustainable technologies like geothermal systems, we’re enabling affordable housing communities to benefit from stable, carbon-free energy for decades to come.”
The intention is to grow multifamily affordable housing developments in the Buffalo area, boosting energy efficiency, cutting fossil fuel reliance and helping keep energy costs steady for residents in the process.
Geothermal systems leverage underground heat to provide highly efficient, carbon-free HVAC services to residents and are eligible for full federal Investment Tax Credits if construction starts by the end of 2033.
By unlocking federal Investment Tax Credits, the facility will accelerate deployment of clean energy solutions while supporting equitable housing and community benefits, a GCC statement noted.
The new facility builds on an existing loan between GCC and NYGB, which provided bridge funding for state-level clean energy incentives that GCC’s renovations qualify for.
“NY Green Bank is proud to support Good Carbon Co. on this pioneering transaction,” said Kelsey Clair, NYGB’s Managing Director, Investment and Portfolio Management.
“As the first publicly announced ITC transferability bridge loan in geothermal, this deal demonstrates the viable investment opportunity of geothermal heating systems in a residential setting while also ensuring that more New Yorkers can enjoy comfortable heating and cooling in their homes.”