This past November, California voters overwhelmingly passed Proposition 39, which will raise an estimated $550 million a year over the next five years to underwrite energy efficiency and advanced energy projects in schools. Savings generated by these improvements will be plowed directly back into classroom instruction, providing significant relief to cash-strapped school districts.
Now comes the hard part of implementing it. The Legislature has responsibility for defining how the money is to be spent, who is responsible for administering it, what the scope of projects can be, and if and how public-private partnerships can be used to extend the available funds.
AEE has developed a set of principles we believe should guide program details. These ideas stem from a series of meetings with advanced energy businesses that have considerable experience in working with California schools on exactly these kinds of projects.
1. Funds should be spent to meet the intent of the Initiative approved by the voters.
Prop 39 was designed to provide funds for energy efficiency and other advanced energy investments and should be used for that purpose alone. Furthermore, while Prop 39 allows for a number of possible uses, schools appear first, and funds should be directed there initially. Finally, Prop 39 promised voters that energy savings would provide additional funds for classroom instruction, not substitute for current classroom expenditures. Specifically, dollars generated under Prop 39 should not be used to meet the minimum school funding requirements under Prop 98.
2. The program should ensure transparency, proper oversight and rapid deployment.
Proper oversight is critical to effective implementation of Prop 39. The Legislature should designate a single agency with the resources, capability and experience to manage a project of this magnitude, with a cross-agency group formed to advise the lead agency. Participants should include representatives of the California Energy Commission, California Public Utilities Commission, Division of the State Architect, the Office of Public School Construction, Department of Education and the Governor’s office. To accelerate implementation, projects that have been proposed under existing state or utility programs but for which there has been insufficient funding should be eligible to participate. Many if not all of these have already gone through an extensive vetting process. Finally, funds should be set aside for independent measurement and verification to ensure that projects achieve the results promised.
3. Provide training to ensure that all districts are able to participate on an equal footing.
Many of the locations that most desperately need improvements that could be funded by Prop 39 are least equipped to apply for and manage the projects. A portion of Prop 39 dollars should be directed to train district personnel on the process of applying for funding and the ongoing management of buildings and equipment once the project is completed.
4. Funds should be distributed based on the potential for energy savings and the return on the public dollars invested in these projects.
In order to return as much money as possible for use in classrooms, funds should be allocated to those projects that prove to have immediate energy savings potential while stimulating local jobs and economies. Rather than funding a large number of lighting retrofits, which have the most immediate payback, the state should take a whole-project approach that captures the biggest savings from energy efficiency, energy management systems (including demand management) and technologies such as renewable energy and energy storage for back-up. Each proposed project should be technology-neutral and judged based on its ability to significantly and permanently improve a school’s energy usage.
5. The program should leverage private funding to stretch Prop 39 dollars.
Policymakers should look at smart and creative ways to expand the program’s reach and funding potential by leveraging private funds. Structuring the program to attract and encourage private investment in and lending to eligible projects should be a programmatic priority. Even if confined to schools, the $2.75 billion in Prop 39 funds will only begin to address the need. Involving an increasing number of private dollars over the five years of Prop 39’s life can make the program sustainable and allow it to make more public buildings models of energy management.
AEE is actively working with the Legislature and the Governor’s office on legislative language based on these principles to realize the promise of Prop 39 to transform our schools into models of efficient energy usage.
For more on the topic, AEE recently released a report featuring the voices of advanced energy business leaders in California. Read the report by clicking the button below:
