Greenhouse Gas Reduction Loan Program

Loan Program Information

CalRecycle administers the Greenhouse Gas Reduction (GHG) loan program to assist recycling manufacturers in financing machinery, equipment, and ancillary costs to site and expand in California (pursuant to Public Resources Code, section 42995).

Recycling manufacturers use waste materials generated in California to make recycled-content intermediate and/or final products, assisting local jurisdictions in complying with landfill diversion laws and supporting the Circular Economy.

These investments:

  • further the purposes of the California Global Warming Solutions Act (Assembly Bill 32)
  • reduce methane emissions from landfills
  • furthers GHG reductions in upstream resource management and manufacturing processes
  • benefit disadvantaged communities by upgrading existing facilities
  • establishing new facilities that reduce GHG emissions
  • results in air and water quality improvements
  • and creates jobs

This program is part of California Climate Investments, a statewide program that puts billions of cap-and-trade dollars to work reducing greenhouse gas emissions, strengthening the economy, and improving public health and the environment. The Cap-and-Trade program also creates a financial incentive for industries to invest in clean technologies and develop innovative ways to reduce pollution.

California Climate Investments projects include:

  • affordable housing
  • renewable energy
  • public transportation
  • zero-emission vehicles
  • environmental restoration
  • more sustainable agriculture
  • recycling
  • and much more

At least 35 percent of these investments are made in disadvantaged and low-income communities.
For more information, visit California Climate Investments.

Program News...

  • Available Funds: FY 2023-24 (July 1, 2023 – June 30, 2024) is $5,280,000 (estimated)
  • For updates, send an email to:

Application Forms


Eligible applicants include:

    • Government
      • Cities and Counties
      • Regional or local sanitation agencies, waste agencies, or joint powers authorities.
    • Private, for-profit entities.
    • Nonprofit organizations (except private schools).

Loan Recipients

Learn more about loans that have been awarded.

  • Loan Award Information: Charts displaying data on number of loans awarded, amounts, and how funds were used.
  • Loan Recipient Search: Search for loan recipients by business name, zone, county, product category, feedstock category, loan type, and/or year.

Eligibility Requirements

Facility/Manufacturer Type

  • Preprocessor
    • A preprocessor produces an intermediate product which requires further processing by another manufacturer.
    • The preprocessor must result in new diversion from landfills, e., beyond that which was already being diverted.
    • The preprocessor must provide proof of binding agreement with a California finished product producer that receives the preprocessed feedstock to make compost, soil amendments, biofuels, bioenergy, or recycled content finished products.
  • Finished Product Producer
    • A finished product producer makes a good or package in a form which requires no further processing or forming before it is offered for sale to an end-user. It does not include intermediate products, such as plastic pellets sold as feedstock to a converter for fabrication into a consumer product.
  • Food Waste Prevention
    • The loan program cannot finance equipment and machinery that will be located and operated by a third-party.

Project Location

  • A preprocessor who makes intermediate recycled-content intermediate products, must be located in California, and sell the products to Finished Product Producers that are also located in California.
  • Finished product producers must be located in California.

Feedstock Waste Material Types

  • Organics Projects: Organics (green waste and food waste) waste materials.
  • Recycled Fiber, Plastic, and Glass Projects: Recycled fiber (paper, textiles including mattresses, carpet, and wood), plastic, and glass waste materials.

Environmental Requirements

  • Greenhouse Gas Emission Reduction:
    Projects must be located in California and result in permanent, annual, and measurable reductions in greenhouse gas (GHG) emissions.
  • Feedstock/Waste Material Diversion from Landfills
    Projects must increase the quantity (tons) of:
  1. Organics projects: California-generated green or food materials, or alternative daily cover (ADC) newly diverted from landfills and composted or digested; or
  2. Recycled fiber, plastic, and glass projects: California-generated fiber, plastic, or glass materials newly diverted from landfills.

For purposes of this program, “newly diverted” means the tons of materials that are currently being landfilled or used as alternative daily cover that will instead be diverted as a result of this project.

Eligible Projects

Construction, renovation, or expansion of facilities to increase in-state infrastructure for:

  1. The digestion or composting of organics into compost, soil amendments, biofuels, or bioenergy; or
  2. The manufacturing of value-added finished products using California derived recycled content fiber, plastic, or glass.
  • Construction, renovation, or expansion of facilities to increase in-state infrastructure for:
  1. The preprocessing of organics when providing preprocessed materials to an in-state digestion or composting facility that is using the waste to make compost, soil amendments, biofuels, or bioenergy; or
  2. The preprocessing of fiber, plastic or glass waste when providing preprocessed materials to an in-state manufacturing facility that is using the waste to make finished products.
  • Expansion of projects that have previously received Greenhouse Gas Reduction grants or loans from CalRecycle are eligible provided the project meets the loan criteria and the previously funded project is progressing in a manner satisfactory to CalRecycle.
  • Food waste prevention projects result in measurable reduction in food waste normally destined for a These projects can prevent food waste through source reduction and/or edible food rescue. Food rescue must result in rescued food being distributed to people in a disadvantaged community with any food waste residuals from the project being sent to a compost, digestion, or fermentation facility when one is available within the food waste prevention project’s service area.
  • New and expanded facilities will be required to use the best available control technology (BACT) to limit emissions and ensure compliance with air quality standards.

Use of Loan Fund Disbursements

Eligible costs include:

  • Purchase of equipment and machinery.
  • Real estate improvements associated with the installation of the equipment and The land owner may need to provide a deed of trust to ensure that the loan has adequate collateral.
  • Purchase of real estate that is directly associated with the project’s material processing, where the real estate includes a building or other real estate improvements used solely for that processing or manufacturing.

Loans made to finance the purchase of commercial real estate and/or to make necessary real-estate improvements will require the application of sustainable building practices. At least 25% of the loan funds approved for improvements to property must be applied toward costs involving sustainable building products and services. Examples include the use of recycled paints, carpets, cubicles, and rubberized asphalt. The installation of energy efficient lighting, heating and cooling systems, water conservation and shade producing landscape would also apply.

Borrowers are required to provide invoices showing that 25% of the amount borrowed for improvements was used for sustainable building practices.

Ineligible costs include:

  • Working capital
  • Refinance of onerous debt
  • Payment of the loan closing fee

Permit and CEQA Requirements

Permit requirements are as follows:

  • Eligible projects do not qualify for a loan unless they are past the design phase of the project and are prepared for construction. Applicants must obtain all significant applicable federal, state, and local permits prior to CalRecycle Loan Committee consideration of the Significant permits may include: Air Permit, Water Quality Permit, Fire Permit, Solid Waste Facility Permit, Business License, and/or a Conditional Use Permit.
  • Applicants shall complete all California Environmental Quality Act (CEQA) requirements for their project before the loan request is presented to the loan committee.


Join the Greenhouse Gas Reduction Programs Listserv to be notified by email for program updates and when funding becomes available.

For more information, contact