A college education is expensive, often causing students to rack up piles of debt. Many are worried that student loans could become the next housing bubble.
The general trend is for tuition to rise each year. This past year tuition and fees rose about 2.9% for in-state students at four-year public schools. Meanwhile, the cost to go to a private school is up about 3.8%. Both growth rates marked a slowdown from previous years, but the expense trend is undeniable.
To keep costs down, some colleges are turning toward solar energy. For example, SunPower (NASDAQ:SPWR) announced last week that it has installed 20 megawatts of solar panels at a dozen community colleges in California. These panels will produce enough renewable energy to power 4,100 homes and are expected to save the schools $5.4 million per year.
SunPower's largest community college project so far encompasses installation of 3.8 MW of solar capacity on carports at College of the Desert. The system will generate about two-thirds of the school's total electricity needs. It will save the college money that can be used to enhance its academic programs.
College of the Desert collaborated with First Solar (NASDAQ:FSLR) and Palo Verde Community College on the Desert Sunlight Solar Project. First Solar donated solar equipment, hands-on training, and curriculum to both schools as part of the project. The venture created the region's first utility-scale solar training program that supports the 550 MW Desert Sunlight project and its 430 construction jobs.
While most of solar's savings will be used to enhance program offerings, solar is also an important tool for colleges to use in bridging budget gaps. Many institutions have seen budgets drastically cut since the Great Recession; some are going green to cut costs in an effort to recoup lost money.
For example, Mercer County Community College in New Jersey had an 8 MW solar system installed on its campus. The project will support 70% of the school's energy requirements and save it $775,000 annually. Those savings will be used to fund services that would have had to be diminished or eliminated due to budget cuts.
According to the Association for the Advancement of Sustainability in Higher Education, there are now more than 541 solar installations on 322 college campuses spread across 45 states. They represent total installed capacity of 183,747 kilowatts. These projects are saving schools millions of dollars each year.
That said, these solar installations won't cut the cost of a college tuition. However, they can help many schools keep costs at bay. That alone will enhance the value proposition as colleges can either sustain programs or enhance opportunities for students without having to dramatically increase tuition. So while students shouldn't expect to see lower tuition bills thanks to solar, at least those bills won't be rising as fast in the future.
How you can invest in your future outside of education
Fool contributor Matt DiLallo has no position in any stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.