Orange County Power Authority Board To Hold Inaugural Meeting
OCPA board members will be sworn in during the meeting, including Irvine representatives Mayor Farrah Khan and Councilmember Mike Carroll. Huntington Beach Councilmember Mike Posey, Buena Park Councilwoman Susan Sonne, and a Fullerton representative will also be in attendance. Fullerton joined Irvine to create the OCPA on November 3, Huntington Beach voted to join OCPA just last week, and Lake Forest is scheduled to discuss and possibly vote on Community Choice Energy (CCE) tonight.
Cities who have already signed up have until February 13, 2021 to notify Irvine should they wish to exit the OCPA.
CCE will provide electricity customers an alternative to Southern California Edison (SCE), which is planning a 14.4% rate increase for residential customers in 2021. An Irvine study found that CCE will reduce Irvine’s greenhouse gas emissions by 360,000 metric tons each year, roughly the same emissions impact as taking 78,000 cars off the road annually.
Electricity users in participating cities will be automatically enrolled in the program, but can switch back to SCE at any time. SCE will still manage electricity delivery and billing.
The financial projections to launch CCE are outlined in the staff report to agenda item 7, “Approval of Capital Loan Agreement to Fund Authority Operations”:
The City of Irvine is providing the necessary funding for the Authority to launch the CCE program on behalf of the Authority’s members. The funding takes the form of a Capital Loan Agreement, as defined in Section 5.5 of the Agreement. The Capital Loan Agreement provides for and defines three tranches of funding, including:
(1) Formation Costs – The City estimates that its costs to study, form and implement the Authority are $250,000, which include, but are not limited to, costs for its feasibility study, peer review, City staffing, legal costs, member and stakeholder outreach, and formation of the Authority.
(2) Pre-launch Costs – The City estimates that the Authority will need approximately $2,500,000 for working capital to pay for implementation costs through a projected launch of the Community Choice Aggregator (CCA) program in 2022.
(3) Launch Costs – The City further estimates that the Authority will need up to an additional $8,000,000 to $20,000,000 in the form of a credit facility for operational support and power procurement as well as other cash flow needs, and that any such credit facility may require cash collateral from an Authority member between $2,000,000 to $5,000,000.
Capital Loan Agreement Repayment Obligation:
- Up to $250,000 Formation Costs
- $2,500,000 Pre-launch Costs
- $2,000,000-$5,000,000 Launch Costs subject to future credit facility requirements
The City of Irvine executed the Capital Loan Agreement on November 20, 2020. It is now recommended that the Authority, in addition to the City of Irvine, execute the agreement to ensure timely funding for CCE implementation, and that the Chair or Vice Chair be delegated authority to sign the contract.
The Chair and Vice Chair will be selected at this meeting (Agenda Item 4) prior to approving the Capital Loan Agreement (Agenda Item 7).
The Joint Powers Authority document that governs OCPA stipulates that Irvine will be repaid for all start-up costs on a timeline to be determined by the members of the board and potential future board members at a later date. OCPA will also borrow $8-20 million for operation support and power procurement as well as other cash flow needs.
To Attend the Meeting
Zoom: https://zoom.us/j/98816103889?pwd=eTJST0lmL05iSVRuQlVIUjByWVcvZz09#success(link is external)
Webinar ID: 988 1610 3889
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Dial 669-900-6833 or 346-248-7799 or 25- 21- 8782 or 929-436-2866 or 301-715-8592 or 312-626-6799
Webinar ID: 988 1610 3889
Requests to Speak – Members of the public who have requested to speak will be recognized at the appropriate time during the Zoom meeting and may speak through Zoom or telephonically. To allow the Chair to call on you, please provide the following minimum information with your request to speak: your name (if attending by videoconference) or telephone number (if attending by phone).
Comments shall be limited to three minutes when speaking. If you have anything that you wish to be distributed to the Board, please provide it via environmentalprograms@