Electrifying School Bus Fleets: Funding and Financial Avenues


School districts, bus fleet contractors, and Engineering, Construction, and Procurement (EPC) firms nationwide have been presented with a golden opportunity to embrace the shift to electric school buses (ESBs) and contribute to a cleaner environment.


One significant barrier restricting ESB adoption has been the costs of this transition and the complexity of installing charging infrastructure. Fortunately, various funding options and innovative technologies have emerged to support these endeavors, with Heila Technologies leading the way as a comprehensive solution provider.


Funding Opportunities Abound: Paving the Way to Charge Ahead


Although ESBs have higher upfront costs than traditional diesel or gasoline-powered buses, industry analysts expect the total cost of ownership (TCO) to reach parity by 2027. Battery technology advancements, increased supply chain outputs, and lower fuel and maintenance expenses will drive down ESB TCO further.


The higher upfront sticker price can still be prohibitively restrictive to districts and private fleet operators interested in fleet electrification despite the long-term value. However, while the cost of electrifying ESBs and installing the necessary charging infrastructure might seem out of reach, a wide offering of funding sources have emerged to make this transition more feasible.


These options range from federal grants to state incentives and utility programs to private partnerships, each underscoring the importance of transitioning to ESBs. The programs aim to promote cleaner transportation options, reduce emissions, and improve air quality around schools. The Electric School Bus Initiative has identified more than 300 funding and financing opportunities to help schools and districts electrify bus fleets.


Federal programs such as the EPA’s Clean School Bus USA initiative and the Volkswagen Settlement Zero Emissions Technology Investments have dedicated substantial funds to support clean transportation projects. Utility companies are also increasingly offering programs that provide financial incentives for installing EV charging infrastructure.


Many states have passed aggressive incentive programs to significantly reduce upfront costs. Below are some of the more prominent programs by state.


California Electric School Bus Funding


As part of its FY23 budget, the state approved a nation-leading $1.5 billion in ESB funding. The California Air Resources Board (CARB) administers the Clean School Bus Program, which provides a variety of grants, vouchers, and rebates to replace older diesel school buses with electric buses, install charging infrastructure, and retrofit devices and power systems.


New York Electric School Bus Funding


New York State Energy Research and Development Authority (NYSERDA) currently has four well-funded programs to provide resources to school districts to purchase ESBs and charging infrastructure. Additionally, New York State’s 2022-2023 budget requires all new school buses purchased to be zero emission by 2027 and all school buses in operation to be electric by 2035.


Colorado Electric School Bus Funding


With $65 million available in funding, Colorado is second nationally in both overall awarded funds and per capita funding for ESBs (behind California). The Colorado Department of Public Health & Environment (CDPHE) is overseeing the Colorado Electric School Bus Grant Program. Grants formerly provided by the state’s Regional Air Quality Council (RAQC) ALT Fuels Colorado program have been fully allocated to the CDPHE’s ESB grant program.


Illinois Electric School Bus Funding


The Illinois EPA’s School Bus Replacement Program recently announced a $27 million Notice of Funding Opportunity (NOFO) for the replacement of old diesel school buses with electric buses and to install charging infrastructure.


Massachusetts Electric School Bus Funding


The Massachusetts Clean Energy Center (MassCEC) is currently advancing school bus electrification with the Accelerating Clean Transportation (ACT) program providing $18.3 million in funding for fleet deployment and advisory services.


Implementing Electric School Buses: The Process


Identifying funding opportunities is the all-important first step in going electric. But what comes next?


You’ll need to gather and manage a team of stakeholders, subcontractors, component suppliers, and technology providers. However, assembling this team and keeping everyone on track can be a complex process with its own set of challenges, some of which include:


  1. Managing diverse stakeholder goals and interests
  2. Ensuring regular communication
  3. Maintaining vendor relationships and streamlining procurement
  4. Coordinating schedules across an extended project timeline
  5. Mitigating risks to avoid delays and extra costs


That’s where Heila Technologies can help. With vast experience on the cutting edge of the energy sector, Heila has been redefining the role of microgrids and distributed energy resources (DERs) like electric vehicles and EV charging infrastructure.


Heila’s energy solutions platform serves as a central hub to connect all stakeholders and help with permit acquisition, design, contractor selection, and implementation. This comprehensive approach not only simplifies and streamlines the process but also minimizes project complexities to help school districts, fleet contractors, and EPCs accelerate electrification.


If this has sparked any questions about electric school bus implementation or our services, reach out to us today. We’d love to hear from you!