The Green Colorado Credit Reserve (GCCR) is a loan loss reserve that was created by the Colorado Energy Office (CEO) to incentivize private lenders in Colorado to make small commercial loans up to $250,000 for capital improvements that promote energy efficiency and renewable energy. The GCCR is administered by the Colorado Housing Finance Authority (CHFA) on behalf of the CEO.

How the Loan Loss Reserve Works

For each loan made by a participating lender, the GCCR will provide a loan loss reserve equal to 15% of the amount of the loan. For example, if a participating lender makes a loan for $100,000, the lender will have $15,000 available to cover any losses in case of loan default.

According to the CEO, A 15% loan loss reserve increases lenders’ risk thresholds, enabling them to offer lower interest rates for loans that promote energy efficiency and renewable energy. Furthermore, the loan loss reserve encourages banks to close multiple loans because the reserve aggregates as the lender makes more loans. For example, if a lender makes ten loans for $100,000, the lender will have aggregated $150,000 for any possible loan losses.

Lender Participation

A list of participating lenders is available through the CHFA. Lenders interested in participating in the GCCR Program should review the program guidelines, and must submit an application to CHFA for approval. By providing a risk sharing mechanism, the GCCR invites lenders to make more of these loans by giving them the experience necessary for them to feel more comfortable with these products in the future.

Contact the CEO Director of Finance & Operations for more information.