<em>"Reducing paper usage benefits the school due to money previously budgeted for paper being spent on creative instructional materials."</em>
Doesn't really make a transition, but turns it all into a single sentence.
<em>"Reducing paper usage benefits the school; however, money previously budgeted for paper could be spent on creative instructional materials." </em>
<u>However</u> is a word of transition, but it is supposed to transition to a counter argument. In this sentence, it doesn't make much sense.
<em>"Reducing paper usage benefits the school; also, money previously budgeted for paper could be spent on creative instructional materials."</em>
<u>Also</u> is supposed to add something to the sentence. In this case, it is explaining the reason behind the first sentence, which is not its proper use.
The correct answer is:
<em>"Reducing paper usage benefits the school; for example, money previously budgeted for paper could be spent on creative instructional materials." </em>
In this option, the transition is made by "for example", followed directly by the example that explains the first sentence, showing a good and coherent transition.