---
kind: "section"
citation: "42 U.S.C. § 6371h–1"
title: "42"
title_heading: "The Public Health and Welfare"
number: "6371h–1"
heading: "Energy sustainability and efficiency grants and loans for institutions"
release: "119-102"
date: "2026-07-12"
url: "https://uscodex.org/usc/42/6371h-1"
units:
  - "Chapter 77 — Energy Conservation"
  - "Subchapter III — Improving Energy Efficiency"
  - "Part E — Energy Conservation Program for Schools and Hospitals"
---

# §6371h–1. Energy sustainability and efficiency grants and loans for institutions

- (a) **Definitions—** In this section:
  - (1) **Combined heat and power—** The term “combined heat and power” means the generation of electric [energy](/usc/42/6291.md?p=3) and heat in a single, integrated system, with an overall thermal [efficiency](/usc/42/6311.md?p=13-H) of 60 percent or greater on a higher-heating-value basis.
  - (2) **District energy systems—** The term “district [energy](/usc/42/6291.md?p=3) systems” means systems providing thermal [energy](/usc/42/6291.md?p=3) from a renewable [energy](/usc/42/6291.md?p=3) source, thermal [energy](/usc/42/6291.md?p=3) source, or highly efficient technology to more than 1 [building](/usc/42/6321.md?p=c-2) or fixed [energy](/usc/42/6291.md?p=3)-consuming use from 1 or more thermal-[energy](/usc/42/6291.md?p=3) production facilities through pipes or other means to provide space heating, space conditioning, hot water, steam, compression, process [energy](/usc/42/6291.md?p=3), or other end uses for that [energy](/usc/42/6291.md?p=3).
  - (3) **Energy sustainability—** The term “[energy](/usc/42/6291.md?p=3) sustainability” includes using a renewable [energy](/usc/42/6291.md?p=3) source, thermal [energy](/usc/42/6291.md?p=3) source, or a highly efficient technology for transportation, electricity generation, heating, cooling, lighting, or other [energy](/usc/42/6291.md?p=3) services in fixed installations.
  - (4) **Institution of higher education—** The term “[institution of higher education](/usc/42/11851.md?p=7)” has the meaning given the term in [section 15801 of this title](/usc/42/15801.md).
  - (5) **Institutional entity—** The term “institutional entity” means an [institution of higher education](/usc/42/11851.md?p=7), a public [school](/usc/42/6371.md?p=6) district, a local government, a municipal utility, or a designee of 1 of those entities.
  - (6) **Renewable energy source—** The term “renewable [energy](/usc/42/6291.md?p=3) source” has the meaning given the term in [section 918c of title 7](/usc/7/918c.md).
  - (7) **Sustainable energy infrastructure—** The term “sustainable [energy](/usc/42/6291.md?p=3) infrastructure” means—
    - (A) facilities for production of [energy](/usc/42/6291.md?p=3) from renewable [energy](/usc/42/6291.md?p=3) sources, thermal [energy](/usc/42/6291.md?p=3) sources, or highly efficient technologies, including combined heat and power or other waste heat use; and
    - (B) district [energy](/usc/42/6291.md?p=3) systems.
  - (8) **Thermal energy source—** The term “thermal [energy](/usc/42/6291.md?p=3) source” means—
    - (A) a natural source of cooling or heating from lake or ocean water; and
    - (B) recovery of useful [energy](/usc/42/6291.md?p=3) that would otherwise be wasted from ongoing [energy uses](/usc/42/6291.md?p=4).
- (b) **Technical assistance grants—**
  - (1) **In general—** Subject to the availability of appropriated funds, the [Secretary](/usc/42/6202.md?p=1) shall implement a program of information dissemination and [technical assistance](/usc/42/6371.md?p=17) to institutional entities to assist the institutional entities in identifying, evaluating, designing, and implementing sustainable [energy](/usc/42/6291.md?p=3) infrastructure [projects](/usc/42/6341.md?p=4) in [energy](/usc/42/6291.md?p=3) sustainability.
  - (2) **Assistance—** The [Secretary](/usc/42/6202.md?p=1) shall support institutional entities in—
    - (A) identification of opportunities for sustainable [energy](/usc/42/6291.md?p=3) infrastructure;
    - (B) understanding the technical and economic characteristics of sustainable [energy](/usc/42/6291.md?p=3) infrastructure;
    - (C) utility interconnection and negotiation of power and fuel contracts;
    - (D) understanding financing alternatives;
    - (E) permitting and siting issues;
    - (F) obtaining case studies of similar and successful sustainable [energy](/usc/42/6291.md?p=3) infrastructure systems; and
    - (G) reviewing and obtaining computer software for assessment, design, and operation and maintenance of sustainable [energy](/usc/42/6291.md?p=3) infrastructure systems.
  - (3) **Eligible costs for technical assistance grants—** On receipt of an application of an institutional entity, the [Secretary](/usc/42/6202.md?p=1) may make grants to the institutional entity to fund a portion of the cost of—
    - (A) feasibility studies to assess the potential for implementation or improvement of sustainable [energy](/usc/42/6291.md?p=3) infrastructure;
    - (B) analysis and implementation of strategies to overcome barriers to [project](/usc/42/6341.md?p=4) implementation, including financial, contracting, siting, and permitting barriers; and
    - (C) detailed engineering of sustainable [energy](/usc/42/6291.md?p=3) infrastructure.
- (c) **Grants for energy efficiency improvement and energy sustainability—**
  - (1) **Grants—**
    - (A) **In general—** The [Secretary](/usc/42/6202.md?p=1) shall award grants to institutional entities to carry out [projects](/usc/42/6341.md?p=4) to improve [energy efficiency](/usc/42/6291.md?p=5) on the grounds and facilities of the institutional entity.
    - (B) **Requirement—** To the extent that applications have been submitted, grants under [subparagraph (A)](#c-1-A) shall include not less than 1 grant each year to an [institution of higher education](/usc/42/11851.md?p=7) in each [State](/usc/42/6202.md?p=4).
    - (C) **Minimum funding—** Not less than 50 percent of the total funding for all grants under this subsection shall be awarded in grants to institutions of higher education.
  - (2) **Criteria—** Evaluation of [projects](/usc/42/6341.md?p=4) for grant funding shall be based on criteria established by the [Secretary](/usc/42/6202.md?p=1), including criteria relating to—
    - (A) improvement in [energy efficiency](/usc/42/6291.md?p=5);
    - (B) reduction in greenhouse gas emissions and other air emissions, including criteria air pollutants and ozone-depleting refrigerants;
    - (C) increased use of renewable [energy](/usc/42/6291.md?p=3) sources or thermal [energy](/usc/42/6291.md?p=3) sources;
    - (D) reduction in consumption of fossil fuels;
    - (E) active student participation; and
    - (F) need for funding assistance.
  - (3) **Condition—** As a condition of receiving a grant under this subsection, an institutional entity shall agree—
    - (A) to implement a public awareness campaign concerning the [project](/usc/42/6341.md?p=4) in the community in which the institutional entity is located; and
    - (B) to submit to the [Secretary](/usc/42/6202.md?p=1), and make available to the public, reports on any [efficiency](/usc/42/6311.md?p=13-H) improvements, [energy](/usc/42/6291.md?p=3) cost savings, and environmental benefits achieved as part of a [project](/usc/42/6341.md?p=4) carried out under [paragraph (1)](#c-1), including quantification of the results relative to the criteria described under [paragraph (2)](#c-2).
- (d) **Grants for innovation in energy sustainability—**
  - (1) **Grants—**
    - (A) **In general—** The [Secretary](/usc/42/6202.md?p=1) shall award grants to institutional entities to engage in innovative [energy](/usc/42/6291.md?p=3) sustainability [projects](/usc/42/6341.md?p=4).
    - (B) **Requirement—** To the extent that applications have been submitted, grants under [subparagraph (A)](#d-1-A) shall include not less than 2 grants each year to institutions of higher education in each [State](/usc/42/6202.md?p=4).
    - (C) **Minimum funding—** Not less than 50 percent of the total funding for all grants under this subsection shall be awarded in grants to institutions of higher education.
  - (2) **Innovation projects—** An innovation [project](/usc/42/6341.md?p=4) carried out with a grant under this subsection shall—
    - (A) involve—
      - (i) an innovative technology that is not yet commercially available; or
      - (ii) available technology in an innovative application that maximizes [energy efficiency](/usc/42/6291.md?p=5) and sustainability;
    - (B) have the greatest potential for testing or demonstrating new technologies or processes; and
    - (C) to the extent undertaken by an [institution of higher education](/usc/42/11851.md?p=7), ensure active student participation in the [project](/usc/42/6341.md?p=4), including the planning, implementation, evaluation, and other phases of [projects](/usc/42/6341.md?p=4).
  - (3) **Condition—** As a condition of receiving a grant under this subsection, an institutional entity shall agree to submit to the [Secretary](/usc/42/6202.md?p=1), and make available to the public, reports that describe the results of the [projects](/usc/42/6341.md?p=4) carried out using grant funds.
- (e) **Allocation to institutions of higher education with small endowments—**
  - (1) **In general—** Of the total amount of grants provided to institutions of higher education for a fiscal year under this section, the [Secretary](/usc/42/6202.md?p=1) shall provide not less than 50 percent of the amount to institutions of higher education that have an endowment of not more than $100,000,000.
  - (2) **Requirement—** To the extent that applications have been submitted, at least 50 percent of the amount described in [paragraph (1)](#e-1) shall be provided to institutions of higher education that have an endowment of not more than $50,000,000.
- (f) **Grant amounts—**
  - (1) **In general—** If the [Secretary](/usc/42/6202.md?p=1) determines that cost sharing is appropriate, the amounts of grants provided under this section shall be limited as provided in this subsection.
  - (2) **Technical assistance grants—** In the case of grants for [technical assistance](/usc/42/6371.md?p=17) under [subsection (b)](#b), grant funds shall be available for not more than—
    - (A) an amount equal to the lesser of—
      - (i) $50,000; or
      - (ii) 75 percent of the cost of feasibility studies to assess the potential for implementation or improvement of sustainable [energy](/usc/42/6291.md?p=3) infrastructure;
    - (B) an amount equal to the lesser of—
      - (i) $90,000; or
      - (ii) 60 percent of the cost of guidance on overcoming barriers to [project](/usc/42/6341.md?p=4) implementation, including financial, contracting, siting, and permitting barriers; and
    - (C) an amount equal to the lesser of—
      - (i) $250,000; or
      - (ii) 40 percent of the cost of detailed engineering and design of sustainable [energy](/usc/42/6291.md?p=3) infrastructure.
  - (3) **Grants for efficiency improvement and energy sustainability—** In the case of grants for [efficiency](/usc/42/6311.md?p=13-H) improvement and [energy](/usc/42/6291.md?p=3) sustainability under [subsection (c)](#c), grant funds shall be available for not more than an amount equal to the lesser of—
    - (A) $1,000,000; or
    - (B) 60 percent of the total cost.
  - (4) **Grants for innovation in energy sustainability—** In the case of grants for innovation in [energy](/usc/42/6291.md?p=3) sustainability under [subsection (d)](#d), grant funds shall be available for not more than an amount equal to the lesser of—
    - (A) $500,000; or
    - (B) 75 percent of the total cost.
- (g) **Loans for energy efficiency improvement and energy sustainability—**
  - (1) **In general—** Subject to the availability of appropriated funds, the [Secretary](/usc/42/6202.md?p=1) shall provide loans to institutional entities for the purpose of implementing [energy efficiency](/usc/42/6291.md?p=5) improvements and sustainable [energy](/usc/42/6291.md?p=3) infrastructure.
  - (2) **Terms and conditions—**
    - (A) **In general—** Except as otherwise provided in this paragraph, loans made under this subsection shall be on such terms and conditions as the [Secretary](/usc/42/6202.md?p=1) may prescribe.
    - (B) **Maturity—** The final maturity of loans made within a period shall be the lesser of, as determined by the [Secretary](/usc/42/6202.md?p=1)—
      - (i) 20 years; or
      - (ii) 90 percent of the useful [life](/usc/42/6291.md?p=30-P) of the principal physical asset to be financed by the loan.
    - (C) **Default—** No loan made under this subsection may be subordinated to another debt contracted by the institutional entity or to any other claims against the institutional entity in the case of default.
    - (D) **Benchmark interest rate—**
      - (i) **In general—** Loans under this subsection shall be at an interest rate that is set by reference to a benchmark interest rate (yield) on marketable Treasury securities with a similar maturity to the direct loans being made.
      - (ii) **Minimum—** The minimum interest rate of loans under this subsection shall be at the interest rate of the benchmark financial instrument.
      - (iii) **New loans—** The minimum interest rate of new loans shall be adjusted each quarter to take account of changes in the interest rate of the benchmark financial instrument.
    - (E) **Credit risk—** The [Secretary](/usc/42/6202.md?p=1) shall—
      - (i) prescribe explicit standards for use in periodically assessing the credit risk of making direct loans under this subsection; and
      - (ii) find that there is a reasonable assurance of repayment before making a loan.
    - (F) **Advance budget authority required—** New direct loans may not be obligated under this subsection except to the extent that appropriations of budget authority to cover the costs of the new direct loans are made in advance, as required by [section 661c of title 2](/usc/2/661c.md).
  - (3) **Criteria—** Evaluation of [projects](/usc/42/6341.md?p=4) for potential loan funding shall be based on criteria established by the [Secretary](/usc/42/6202.md?p=1), including criteria relating to—
    - (A) improvement in [energy efficiency](/usc/42/6291.md?p=5);
    - (B) reduction in greenhouse gas emissions and other air emissions, including criteria air pollutants and ozone-depleting refrigerants;
    - (C) increased use of renewable electric [energy](/usc/42/6291.md?p=3) sources or renewable thermal [energy](/usc/42/6291.md?p=3) sources;
    - (D) reduction in consumption of fossil fuels; and
    - (E) need for funding assistance, including consideration of the size of endowment or other financial resources available to the institutional entity.
  - (4) **Labor standards—**
    - (A) **In general—** All laborers and mechanics employed by contractors or subcontractors in the performance of [construction](/usc/42/300s–3.md?p=7), repair, or alteration work funded in whole or in part under this section shall be paid wages at rates not less than those prevailing on [projects](/usc/42/6341.md?p=4) of a character similar in the locality as determined by the [Secretary](/usc/42/6202.md?p=1) of Labor in accordance with sections 3141 through 3144, 3146, and 3147 of title 40. The [Secretary](/usc/42/6202.md?p=1) shall not approve any such funding without first obtaining adequate assurance that required labor standards will be maintained upon the [construction](/usc/42/300s–3.md?p=7) work.
    - (B) **Authority and functions—** The [Secretary](/usc/42/6202.md?p=1) of Labor shall have, with respect to the labor standards specified in [paragraph (1)](#g-1), the authority and functions set forth in Reorganization Plan Number 14 of 1950 (15 Fed. Reg. 3176; 64 Stat. 1267) and [section 3145 of title 40](/usc/40/3145.md).
- (h) **Program procedures—** Not later than 180 days after December 19, 2007, the [Secretary](/usc/42/6202.md?p=1) shall establish procedures for the solicitation and evaluation of potential [projects](/usc/42/6341.md?p=4) for grant and loan funding and administration of the grant and loan programs.
- (i) **Authorization—**
  - (1) **Grants—** There is authorized to be appropriated for the cost of grants authorized in subsections [(b)](#b), [(c)](#c), and [(d)](#d) $250,000,000 for each of fiscal years 2009 through 2013, of which not more than 5 percent may be used for administrative expenses.
  - (2) **Loans—** There is authorized to be appropriated for the initial cost of direct loans authorized in [subsection (g)](#g) $500,000,000 for each of fiscal years 2009 through 2013, of which not more than 5 percent may be used for administrative expenses.

## Source credit

(Pub. L. 94–163, title III, § 399A, as added Pub. L. 110–140, title IV, § 471, Dec. 19, 2007, 121 Stat. 1642.)

## Notes

### Editorial Notes

### References in Text

Reorganization Plan Number 14 of 1950, referred to in subsec. (g)(4)(B), is set out in the Appendix to Title 5, Government Organization and Employees.

### Statutory Notes and Related Subsidiaries

### Effective Date

Section effective on the date that is 1 day after Dec. 19, 2007, see section 1601 of Pub. L. 110–140, set out as a note under section 1824 of Title 2, The Congress.