EPA to revise $5 billion Clean School Bus Program, opens public consultation on alternative fuels

The U.S. Environmental Protection Agency has announced a restructuring of the $5 billion Clean School Bus Program and opened a public consultation on alternative fuel technologies ahead of the 2026 funding round.

The U.S. Environmental Protection Agency on February 19, 2026 outlined a path forward for revising the Clean School Bus (CSB) Program, including the launch of a Request for Information (RFI) and the cancellation of the 2024 CSB Rebate Program. The agency stated that the changes are intended to strengthen oversight and compliance and to align future funding rounds with current federal policy priorities. The announcement was released by the EPA Press Office.

The Clean School Bus Program was established under the Infrastructure Investment and Jobs Act of 2021, which directed EPA to allocate $5 billion over five fiscal years, from 2022 through 2026, for the replacement of existing school buses with clean or zero-emission models and for associated fueling infrastructure. According to the EPA press release, approximately $2.7 billion has been awarded since 2021.

EPA seeks Information on alternative fuels and technologies

Lee Zeldin was confirmed as the 17th Administrator of the Environmental Protection Agency (EPA) on January 2025, following his nomination by Donald Trump. His mandate focuses on advancing a deregulation agenda aimed at boosting domestic energy production and industrial competitiveness. While pledging to maintain clean air and water standards, Zeldin’s leadership marks a significant shift toward rolling back various federal climate regulations. This administrative pivot reflects the broader economic priorities of the current U.S. executive branch regarding environmental oversight.

Back to EPA press note, the agency is issuing a Request for Information to gather feedback from fleet operators, manufacturers, school officials and energy producers on the availability, cost and performance of a range of school bus fuel options. Technologies identified in the RFI include biofuels, compressed natural gas, liquefied natural gas and hydrogen.

The agency stated that these fuel options are permitted under the statute establishing the program. The information collected during the 45-day public comment period will be used to inform the structure of the 2026 grant funding round.

EPA confirmed that no funds will be awarded under the 2024 CSB Rebate Program. Applicants from that round are invited to apply under the forthcoming 2026 grant framework. Further details regarding eligibility and funding criteria will be published in a Notice of Funding Opportunity.

Funding allocation and manufacturer exposure

According to figures reported in the EPA press release, around 90 percent of the $2.7 billion distributed under the program to date has supported electric school buses, with the remaining funding directed to propane-fueled vehicles.

The agency referenced the case of Lion Electric: that “went bankrupt in 2024. This was despite having received approximately $160 million directly in CSB funding, and with school districts using their own CSB awards to also purchase Lion Electric buses – reads the press note -. To date, some buses remain undelivered and not adequately maintained due to Lion Electric’s action. EPA is not able to comment further on matters pertaining to ongoing litigation but is evaluating potential options once the bankruptcy proceedings conclude”.

“As was the case with so many of the Biden-era programs, the Clean School Bus program has been a disaster of poor management and wasteful spending of taxpayer dollars. At the Trump EPA, we have zero tolerance for reckless spending. Today, EPA takes the next step to set the program straight,” said EPA Administrator Lee Zeldin. “Americans can rest assured that moving forward, the program will be safe, effective, and use reliable forms of American energy.”