The Irvine City Council has voted 3-2 to remain part of the troubled Orange County Power Authority (OCPA). City leaders will revisit the issue in the coming months, at which point things could change.
A series of scathing audits have raised questions about transparency, costs, and mismanagement at the agency. Orange County voted to end its contract last month. Lake Forest pulled the plug in 2021. Huntington Beach is also considering leaving.
An Irvine city staff report acknowledged major transparency issues at OCPA, but concluded that the best course of action was to stay and try to reform the agency from within. Withdrawal from OCPA would “severely impact the city financially,” staff said. Although OCPA has not provided the city with a number, staff believe the exit fee would be around $145 million.
An exit by Irvine would also deal a major blow to the agency, as Irvine residents make up 40% of OCPA’s customer base. Environmental activists pleaded with the city to stay, saying an exit would harm the community choice model and set back the city’s climate change goals.
Mayor Farrah Khan, Vice Mayor Tammy Kim and Councilwoman Kathleen Treseder voted in favor of remaining in OCPA, while also expressing the need for changes at the agency. Councilmembers Larry Agran and Mike Carroll were the dissenting votes.
Agran called the council’s decision “weak, ineffective and business as usual.” Staying in OCPA with no strings attached is “unconscionable,” he added.
Two days before the special meeting vote, State Sen. Dave Min sent letters to both Irvine and Huntington Beach about their potential financial exposure to OCPA. He explained the content of the letters in a news release.
While Community Choice Energy has had a long and successful track record in California, OCPA has faced major questions about its internal business practices since its inception, which culminated in a highly critical Orange County Grand Jury report released in July. In response to this grand jury report, Senator Min and several of his legislative colleagues requested an audit of the OCPA by the Joint Legislative Audit Committee. While the results of that audit are still pending, last week, the Orange County Board of Supervisors voted to withdraw from the OCPA, in a move that could cost taxpayers an estimated $65 million and which leaves the OCPA on potentially shaky ground.
In his letters to Huntington Beach and Irvine, Senator Min requested that the Cities provide information that they may have prepared or received which might provide a better understanding of the potential liabilities these cities may face as a result of their involvement with OCPA.
“Community Choice Energy programs have had a long and proud history of empowering consumers and helping to move California forward in our efforts to create a green energy economy,” Min said. “Unfortunately, throughout its short history, the Orange County Power Authority has been plagued with serious concerns about its executive leadership, transparency, and its finances. As a representative of Huntington Beach and Irvine, I sent letters to these cities earlier today because I believe it is imperative that we understand the financial risks that these cities bear from their membership in OCPA, especially with the OC Board of Supervisors decision last week to withdraw from the program.”
Watch video from the special meeting of the Irvine City Council here.