Overview of the Aboriginal Loan Guarantee Program (ALGP)
- The $1 billion Aboriginal Loan Guarantee Program supports Indigenous participation in electricity infrastructure projects, including renewable energy infrastructure in Ontario (e.g., wind, solar and hydroelectric generation projects) and transmission projects.
- The program provides a Provincial guarantee for a loan to an Indigenous entity to finance a portion of its equity investment (typically about 75 per cent) in an eligible project.
- The program is available to entities that are wholly-owned by Indigenous communities.
- By participating in eligible renewable energy projects, First Nation and Métis communities could benefit from jobs and training as projects are developed and from potential dividends once projects come into service.
- The Ontario Financing Authority (OFA) administers the program on behalf of the Province.
- The ALGP requires a sufficient level of due diligence in order to satisfy eligibility criteria and to draft the required underlying legal agreements. The applicant is required to obtain financial and legal advice, and may incur costs passed on from the lender. The OFA and the Province will not be responsible for any costs and/or expenses incurred by the applicant related to the ALGP application and review process. As the scale of these costs is similar, regardless of the size of the application, a small application may not be cost-efficient. The ALGP is better suited for applications greater than $5 million.
- The Aboriginal Loan Guarantee Program is a discretionary, non-entitlement program. Any decision to provide a loan guarantee will be at the sole and absolute option of the Province. This means that even if an application meets the program objectives and criteria, the Province is under no obligation to provide a guarantee.
