Louis Maltezos, co-president of energy infrastructure company Ameresco, said that energy performance contracts and on-site power generation technologies can provide K-12 school districts with effective strategies to cope with rising energy costs.

According to the U.S. Department of Energy's "Better Buildings and Better Plants" initiative, K-12 school districts spend nearly $8 billion annually on energy, making it the second-largest expense after teacher salaries. Data from the U.S. Energy Information Administration shows that the average residential electricity price in March rose 10.2% year-over-year to 18.8 cents per kilowatt-hour, with costs expected to climb further in the future.

Meanwhile, ENERGY STAR notes that more than 30% of school energy use is wasted, and by installing energy-saving measures, schools can save an average of 10% on costs. The U.S. Department of Energy's Building Technologies Program said in February that an energy-efficient school district with 4,000 students could save approximately $160,000 annually.

Maltezos said in an interview that even in regions less affected by rising energy costs, such as the Pacific Northwest with its high share of renewable energy, higher costs may be on the horizon. "In the coming years, they will all see price increases," he said. Maltezos oversees Ameresco's smart energy and building infrastructure strategy, while also managing the company's unified non-federal U.S. project organization, smart building solutions, and Ameresco's Canadian operations.

"With the growth of data centers, capacity shortages, and underinvestment in national infrastructure... we are paying the price," Maltezos said. "In some places where we operate, there have been significant rate increases in double digits for consecutive years. If you haven't seen it yet, you will."

The National Electrical Manufacturers Association predicts that electricity use will "grow in unprecedented ways," with data center energy consumption expected to increase by 300% over the next decade and electric transportation to grow by 2000% by 2050.

According to Ameresco, Georgia Power has implemented six rate increases in three years, driven primarily by data center load. Similar pressures are building in Oregon, Wisconsin, Virginia, and Texas. The company said school districts will be hit hard because they are among the largest non-residential electricity customers in most communities.

Since rate increases directly impact K-12 school district operating budgets, rising energy prices could force districts to make trade-offs between teacher compensation, transportation, and classroom resources, Maltezos said. But he noted that districts investing in on-site solar, energy storage, and energy performance contracts can mitigate this impact.

In New York, Ameresco helped the Mount Sinai School District reduce energy costs by replacing aging building systems, according to a press release. The $10 million project includes LED lighting retrofits, energy management system upgrades, new high-efficiency transformers, and rooftop solar arrays at each of the district's schools. The project, based on an energy performance contract between the district and Ameresco, began in May and is scheduled for completion by the end of 2027.

Maltezos said school officials' familiarity with these contracts varies widely. "In some markets, you knock on doors to talk about performance contracts, and school officials need to learn about the concept," he said. "You have to first show them... what's in it for you. So it varies by region."

By guaranteeing savings, energy service companies like Ameresco can help bridge funding gaps that might otherwise prevent school district officials from making upgrades, Maltezos said.

"If you go talk to most school superintendents or CFOs of large districts, they'll accept that energy-efficient lights save money," Maltezos said. "But what they're less sure about is, what's the exact amount, and can it be relied upon? That's where they need certainty, because they might be putting funds that could go to programs, hiring teachers, or other critical missions into building systems."

By packaging upgrades into turnkey solutions, energy service programs can also reduce the red tape that delays implementation, he said.

"They need to hire architects, develop plans, estimate costs, and get approval (often requiring voter consent) to borrow money," he said. "Then they go to bid, hoping bids come in under estimates. With performance contracts, they can really streamline the process. They can typically hire us or other performance contractors with more flexible procurement methods."

Because performance contractors can guarantee prices and assemble teams familiar with the process, projects can be completed faster, he said. "It's an accelerated process, and the risk is covered," he said.