EPA Releases Initial Report on New $5B Clean Bus Program

February 7, 2022

Greg Jackson, director of transportation and fleet services at Jefferson County Schools watches bus driver Maria Diaz fill up a Blue Bird propane school bus. (Photo by Taylor Hannon.)

The U.S. Environmental Protection Agency released its initial Clean School Bus Program report to Congress, with the first cycle of funding expected to come as early as April in the form of a rebate.

The Clean School Bus Program was signed into law as part of the bipartisan infrastructure bill on Nov. 15. It provides $5 billion over five years split evenly for the replacement of zero- and low-emission school buses.

EPA stated it may also prioritize applicants that propose to replace buses that serve high-need local education agencies, tribal schools, rural or low-income areas, or applications that provide cost-share through public-private partnerships, grants from other entities or school bonds. Though established in Executive Order 14008, 40 percent of the overall benefits from federal investments, including climate and clean energy investments, must reach disadvantaged communities. Thus, the “EPA stated it will focus education on education and outreach efforts to undersevered communities, including partnering with stakeholders to reach communities that may have never applied for a Federal grant or rebate,” the initial report states.

In finalizing awards, the EPA stated it will also consider the following criteria: the lowest overall cost of bus replacement, local conditions (including length of bus routes and weather conditions), impact on manufacturing jobs, technologies that most reduce emissions and whether the funds will bring new technologies to scale or promote cost parity between old technology and new technology.

Eligible recipients include state and local governments, nonprofit school transportation associations, tribal organizations or tribally controlled schools, and bus contractors that also “sell clean school buses, zero-emission buses, charging or fueling infrastructure, or other equipment needed to charge, fuel, or maintain clean or zero-emissions school buses; or arrange financing for such a sale,” the initial report states.

As School Transportation News previously reported, most contractors that provide transportation services to school districts would require third-party interventions to receive the funds. For instance, they would have to either apply through a school district customer or potentially for a point-of-sale rebate directly from a school bus manufacturer or dealer.

Because the EPA has experience awarding grants and rebates through its Diesel Emissions Reduction Act, and due to rebates being the fastest way for EPA to provide funds to fleets for bus replacement, the first cycle of funding is intended to be a rebate program.

However, the EPA intends to also open a competitive Request for Applications for Clean School Bus grant funding in late 2022 or early 2023. It is also reportedly assessing the feasibility of awarding contract funds to eligible contractors to provide school bus rebates.