State lawmakers and Gov. Gavin Newsom let a deadline pass this week without renewing a program that helped California schools pay for air conditioning upgrades, clearing the way for utility companies to reclaim leftover funds and return them to ratepayers instead of classrooms.
The program, known as CalSHAPE — short for California Schools Healthy Air, Plumbing, and Efficiency — was created using nearly $1 billion collected from utility customers to help school districts inspect and repair outdated heating and cooling systems. But the California Energy Commission cut off new applications in 2024, leaving roughly $191 million unspent. Under current law, that unused money must now go back to the utilities that originally supplied it.
Legislators did manage to give schools that already had CalSHAPE grants three additional years to finish their projects before losing access to the money. However, a broader proposal that would have reopened the application window for schools still waiting for upgrades stalled after failing to gain the governor’s backing, according to people familiar with the budget negotiations.
“I don’t understand why the governor doesn’t have the backs of everyday Californians, or why he doesn’t believe kids deserve a safe place to learn with air conditioning,” said Leah Stokes, a UC Santa Barbara political science professor who has pushed for the program’s continuation. “This is all on him.”
A spokesperson for Newsom, Diana Crofts-Pelayo, declined to comment.
A disappointing outcome for advocates
School officials across California have credited CalSHAPE with giving campuses a rare opportunity to address long-neglected ventilation systems. The program funded inspections at more than 4,500 schools, and 172 of them went on to complete major HVAC upgrades using the grants.
But the initiative’s future has been uncertain since mid-2024, when the Energy Commission suddenly halted new applications, citing budget pressures. The pause ignited debate over whether utility ratepayers — rather than the state’s general fund — should be footing the bill for school infrastructure improvements.
Consumer advocacy groups argued the program didn’t provide direct benefits to the ratepayers funding it, while education advocates questioned the fairness of clawing back money that had already been earmarked for local schools.
Later in 2024, Newsom signed an executive order instructing the Energy Commission to review ratepayer-funded programs that might be better financed through other means. San Diego Gas & Electric weighed in during this year’s budget debate, with senior vice president Mitch Mitchell writing in opposition to extending CalSHAPE that the utility’s customers had contributed nearly $189.6 million to the program.
SDG&E stands to recover about $100 million — more than any other utility involved — which would translate to roughly $24 per customer, paid out as $2 monthly credits over a year, according to a legislative analysis. Utility representatives say they intend to pass all reclaimed funds back to customers through bill credits.
“Policymakers cannot credibly elevate affordability while simultaneously redirecting unused customer dollars away from bill relief,” Mitchell wrote.
But school advocates argue the payout amounts are too small to make a real difference for ratepayers. Southern California Edison customers, for instance, would see about $1.25 knocked off their bill each month for a year, while Pacific Gas & Electric customers would receive just 20 cents monthly, the analysis found.
Meanwhile, the inspections funded through CalSHAPE exposed just how outdated many California school HVAC systems have become.
“Extending CalSHAPE deadlines so existing funds could go toward repairing broken school HVAC systems should have been an easy win,” said JuNelle Harris, founder of the nonprofit Clean Air Allies, which advocates for healthier air quality in schools. “Instead, this campaign has become a multiyear saga that’s ended in a deeply disillusioning way.”
Classrooms swelter as summer heat lingers
The timing of the decision comes as a recent heat wave forced many Southern California schools to shorten class days or cancel instruction entirely just as students were returning for the new academic year.
In Los Angeles, where temperatures topped 90 degrees for 12 straight days, the Los Angeles Unified School District restricted outdoor activities for students. LAUSD received $27 million through CalSHAPE to evaluate its aging HVAC systems but got no funding to actually replace or repair them.
In San Diego County, where temperatures hovered in the mid-to-high 80s — well above seasonal norms for the coastal region — the Coronado Unified School District canceled classes altogether due to the heat.
Cody Peterson, a board member for the San Diego Unified School District, said he was frustrated that the state chose to prioritize returning money to ratepayers over addressing urgent cooling needs in classrooms. He also criticized how CalSHAPE was administered, saying its structure made it difficult for districts to complete projects on schedule and discouraged some from applying altogether.
“No child should be in a classroom that is overheating, because they cannot learn, they cannot achieve, they cannot grow,” Peterson said, adding that he’d rather see the state fund HVAC improvements directly rather than through a competitive grant system.
San Diego Unified received $12 million to assess its air conditioning infrastructure but, like LAUSD, received no funding for actual upgrades.
Advocates say they remain baffled by the governor’s stance but plan to keep pushing for state investment in school cooling systems.
“It’s deeply disappointing that lawmakers, starting and ending with the governor, have chosen to treat our children’s and teachers’ interests as secondary to those of big utility companies,” Harris said. “As our outdoor environment is transformed by more extreme weather events and wildfires, safe classrooms where children can learn and grow have never been more important.”
Stokes said she believes Newsom had ample time to act. “He sat on it as an executive for years while disadvantaged communities went without air conditioning,” she said. “Why would he do that? Seems very Trumpian to me.”
While California schools will no longer be able to apply for new CalSHAPE funding, hundreds of districts with existing grants will now have more time to finish their projects. According to the Energy Commission, 216 of the 719 school districts that received grants still have pending upgrades underway.
Original source: CalMatters
