California pauses $200 million school air‑conditioning grant program

The California Energy Commission ended the CalSHAPE grant program two years early, leaving about $200 million unspent. Of more than 4,500 schools that applied for heating and cooling upgrades, only 172 received funding before the program was halted.

A 2025 audit by the California Public Utilities Commission blamed the commission’s complex funding process for the premature shut‑down and warned that districts risk missing deadlines to use the money before it must be returned to utilities. Lawmakers are now debating whether to spend the program’s accrued interest—about $70 million—on an unrelated virtual‑power‑plant initiative. The governor’s 2024 executive order also directed the commission to review rate‑payer‑funded programs for alternative financing sources.

School districts face growing pressure to replace aging air‑conditioning systems as heatwaves intensify, while the unused funds could have helped mitigate rising energy costs for students and families.