Investment in the California Wildfire Innovation Fund will reduce wildfire risk through restoring California forests, improving forest health, and putting new biomass technologies to work.
SACRAMENTO (September 3, 2024) — The state of California’s Infrastructure and Economic Development Bank (IBank) has announced its first investment from the Climate Catalyst Revolving Loan Fund. The program was designed to jumpstart critical climate solutions by offering flexible, low-cost credit and credit support to public and private sector applicants. IBank’s first Climate Catalyst Fund investment will support the California Wildfire Innovation Fund through $25 million in financing.
The California Wildfire Innovation Fund is an investment vehicle focused on climate solutions and managed by Blue Forest, a conservation finance non-profit. The Fund invests in emerging opportunities across California’s forest restoration and wood utilization sectors, seeking to address the wildfire crisis while catalyzing further private sector investment in these solutions. By providing value-added engagements alongside flexible financing, Blue Forest supports the entrepreneurs and companies leading forest restoration and economic revitalization efforts for local communities across the state.
The growth of such businesses and projects is crucial to achieving the state’s goals for both wildfire risk reduction and carbon neutrality by 2045. IBank invests in the California Wildfire Innovation Fund alongside CSAA Insurance Group, which provides AAA-branded insurance and is one of the largest property insurance groups in California. IBank and CSAA’s co-investment in the Fund demonstrates a shared commitment to addressing the wildfire crisis at its source.
“Catastrophic wildfires are one of the most devastating manifestations of climate change in California,” said IBank Executive Director Scott Wu. “We are excited to announce this Climate Catalyst Fund commitment, providing the public investment needed to accelerate projects and promote innovation in wildfire threat reduction, while building key partnerships with private capital to promote the state’s goals.”
“The message from California’s policy leadership in addressing the wildfire crisis is clear: governments at every level must do more, faster, and at a sustained pace, and we need partnerships with the private sector,” said Dan Adler, IBank’s Deputy Director for Climate Finance. “The same is true for climate solutions across the board – governments can help create markets that the private sector can invest in, and provide strategic capital to help those markets grow. Our new partnership with Blue Forest and CSAA is a perfect example of these principles, and a great example of what our Climate Catalyst Fund is intended to achieve.”
“The increasing frequency and severity of catastrophic wildfires requires systems-level solutions. Blue Forest is thrilled to partner with IBank alongside CSAA Insurance Group in a first-of-its-kind coalition of non-profit, public sector, and insurance industry organizations.”, says Blue Forest CEO Zach Knight. “This investment in the California Wildfire Innovation Fund strategically targets the reduction of catastrophic wildfires by enabling entrepreneurs and companies to mobilize innovative forest restoration and wood utilization solutions. Landscape resilience is imperative to community resilience, and we look forward to collaborating with IBank and CSAA to support the growth of a sustainable, community-based restoration economy across California.”
“When we launched the California Wildfire Innovation Fund, our primary goal was to protect California communities and AAA members from wildfire by improving forest resiliency,” said CSAA’s Chief Risk Officer, Jeff Huebner. “We hoped that our efforts would attract like-minded investors and are thrilled that IBank’s matching $25M contribution will greatly magnify the fund’s ability to deliver key environmental, social and financial benefits for all.”
About the Climate Catalyst Revolving Loan Fund: IBank’s Climate Catalyst Revolving Loan Fund is designed to mobilize finance for shovel-ready projects that address the climate crisis, accelerating the speed and scale at which critical climate solutions are deployed, and encouraging private investors to commit capital alongside the public sector.
The Climate Catalyst Fund was initially capitalized by the state of California to address the wildfire crisis in ways that will promote private entrepreneurship and reduce pressure on public budgets. With the expertise and input of state policy partners and subject matter experts, IBank developed the Forest Biomass Management and Utilization Financing Plan. The plan’s eligible investment categories include, but are not limited to: clean energy production, advanced construction materials, forestry equipment needed to achieve the state’s goals for forest and vegetation management treatments, and projects that would revitalize California’s timber industries in ways that support our goals for forest stewardship, including the beneficial use of forest fire salvage, forest thinning for wildfire threat reduction, and the development of industries and related supply chains that utilize forest biomass derived from these processes.
The Climate Catalyst Fund is intended to grow over time to address the full range of future climate finance needs, enabling IBank to expand its services as a “green bank” for the state. Learn more about the Climate Catalyst Revolving Loan Fund and IBank’s other Climate Financing programs on the IBank website.
About the California Infrastructure and Economic Development Bank: IBank was created in 1994 to finance public infrastructure and private development that promote a healthy climate for jobs, contribute to a strong economy, and improve the quality of life for Californians and communities throughout the state. IBank is located within the Governor’s Office of Business and Economic Development and is governed by a five-member board of directors.
