Utilities can lead equitable electrification of nation’s school bus fleet, says new report

The utility industry is well-positioned to take a leading role in easing and accelerating the nation’s transition from diesel school buses to electric-powered ones, according to a new whitepaper funded by Exelon Corp. and released in partnership with several transportation electrification advocates. 

“School bus electrification has the potential to transform the energy grid by providing stability, capacity and emergency power when needed, but most importantly, this change will transform the lives of the students we serve as well,” said Sunny Elebua, Exelon’s Chief Strategy and Sustainability Officer. “We are proud of this study and the opportunity to address disparities and foster healthier communities.”

Currently, almost 95 percent of school buses, which transport 55 percent of all students, run on diesel. On average, 60 percent of low-income students ride the bus daily, compared to 45 percent of students in other income brackets, according to the 55-page report, entitled “The Electric School Bus Transition: Accelerating Equitable Deployments through Understanding Grid Impacts and Policy Solutions.” 

Exelon released the whitepaper today in partnership with the Edison Electric Institute (EEI), CALSTART, the Electric Power Research Institute (EPRI), Clean Energy Works, and the World Resources Institute (WRI).

It examines how the electrification of the U.S. school bus fleet of nearly half a million vehicles provides utility companies and other stakeholders with the opportunity to achieve a variety of health, environmental, energy, resilience, and economic development goals that could benefit customers, communities, and the electric grid. 

“EEI and our member electric companies are committed to delivering resilient clean energy across our economy, and we are excited about all of the work under way to use that energy to reduce emissions from the transportation sector,” said Kellen Schefter, senior director of electric transportation at EEI, which represents all of the nation’s investor-owned utilities, including Exelon. 

Replacing all of the nation’s diesel school buses with electric school buses would avoid roughly nine million metric tons of greenhouse gas (GHG) emissions per year, the equivalent of removing two million cars from America’s roadways, according to the whitepaper.

That’s particularly important for students from underserved communities, who face a disproportionate share of air pollution and other harms associated with emissions from diesel-powered school buses. 

“If pursued with an equity-centered approach, the electrification transition can serve to help address current and historic inequities,” the paper says.

Speed up the process

An equity-centered approach, though, isn’t without issues.

“School bus electrification must scale up quickly and comprehensively to ensure an equitable transition and equal access to zero-emission technologies if we want to both address climate change and also create opportunities for jobs in the zero-emission sector,” said Jared Schnader, senior director and Bus Initiative lead at CALSTART.

Hastening the equitable deployment of electric school buses (ESBs) itself presents other challenges, including the need to manage grid-related impacts and to establish new utility sector policy solutions, the whitepaper says.

“Electric school buses provide many benefits to the utility as well as the community,” Margarita Parra, director of transportation decarbonization at Clean Energy Works, said. “But without carefully considering how to operationalize equity, these benefits run the risk of being unevenly distributed.”

Parra added that equity can serve as a pathway for utilities to be more efficient and effective in achieving their business and energy management goals, while addressing inequities and improving the quality of life for students, teachers, bus drivers, and the local community.

Some funds being utilized

Toward ensuring an equitable transition to ESBs, the whitepaper says that some help is already being provided by the Bipartisan Infrastructure Law, which includes funding for the Environmental Protection Agency’s (EPA’s) Clean School Bus (CSB) Program.

The CSB Program provides $5 billion over fiscal years 2022 to 2026 to replace existing school buses with zero-emission and low-emission models.

The EPA aims to meet recommendations from the Justice40 Initiative to ensure that at least 40 percent of the benefits from the CSB Program fund disadvantaged communities. Additional funding is available through a growing number of state programs, as well, the whitepaper says. 

Under the CSB Program’s first funding opportunity, the 2022 CSB Rebates, EPA solicited applications for zero-emission and low-emission school buses and awarded up to $965 million to fund school bus replacements at nearly 400 schools.

This spring, EPA opened a competitive grant funding program and anticipates awarding at least $400 million under the 2023 CSB Grants Program Notice of Funding Opportunity. EPA plans to announce the selectees for this program by early 2024. 

In the fall, EPA opened the 2023 CSB Rebates program and expects to award at least $500 million in funding under the program.

Thus far, nine districts across Exelon’s service areas have been awarded over $40 million in funding to electrify more than 100 buses in the first round of funding, according to the Fortune 200 company.

“At Exelon, we are committed to sustainable progress, particularly in communities where there are marked disparities such as air quality,” said Elebua.

More money needed 

While school bus operators — a term that also encompasses school districts and school bus contractors — already are taking advantage of these opportunities, federal funding alone won’t be enough to fully electrify all school bus fleets across the United States due to the complex set of infrastructure, operational, and financial issues needed to implement projects at scale, the report says.

“Additional support and complementary programs to achieve this important vision and advance equity will be required,” according to the whitepaper. “All stakeholders, including customers, communities, school bus operators, policymakers, and the utility industry, have important roles and must come together to take advantage of this opportunity and accelerate the equitable transition to ESBs.”

At the same time, the “importance of robust engagement by electric utilities in this transition cannot be overstated,” said Sue Gander, director of the WRI’s Electric School Bus Initiative.

“We look forward to supporting utilities in bringing these recommendations to life — to unlock health, environmental, economic, and grid benefits for communities, starting with underserved communities that experience the worst impacts of vehicle pollution today,” Gander said.

“Zooming in on the critical role of electric utilities, as well as clarifying the interactions school districts and operators will need to have with their utilities, will enable this transformation to unfold swiftly and cost-efficiently,” agreed CALSTART’s Schnader.