The Orange County Power Authority—the county’s first community choice energy program—released a report at a May 3 board meeting that showed a $3 million operating loss over a nine-month period, as the agency’s financial feasibility has been questioned since its launch.
The power authority was created in November 2020 to provide greener energy to residents and businesses throughout Orange County. In operation, the agency takes over Southern California Edison’s role as the buyer and seller of electricity, though Edison’s facilities will still be transporting the agency’s energy to homes and businesses.
So far, four Orange County cities—Irvine, Huntington Beach, Fullerton, and Buena Park—have opted to join the power authority, with Irvine fronting the millions of dollars in startup costs.
The end-of-quarter financial report showed an operating loss of $3,020,301—from July 1, 2021, through March 31, 2022. However, the agency’s power services for commercial businesses did not begin until April 1, when businesses officially switched from Edison to the power authority as their billing cycle resets.
Residential customers are set to be automatically switched over from Edison in October.
What was missing from the report was how much revenue the agency is actually generating from its current consumer base, Irvine City Councilman Larry Agran told The Epoch Times.
“The key number is how much revenue [the power authority] is going to be getting on a monthly basis from the remaining folks who have stayed in and not opted out?” Agran said.
He said the report should have shown how the agency is meeting its revenue projections.
“What matters is if they are meeting their overall revenue projections,” Agran said. “That number was not revealed, which tells me it probably wasn’t revealed because it’s not a good number that meets up well with projections and expectations.”
As of April 26, 2022, 83.88 percent of businesses eligible for service had been transferred to the power authority, which is more than 30,000 utility accounts, according to the report.
Of those accounts, 70 percent have stayed at the 100 percent renewable energy tier, with around 19 percent moving to the less-costly 69 percent renewable energy tier, and around 11 percent moving to the lowest tier at 38 percent renewable energy.
Less than 5 percent of eligible accounts have opted out of the agency’s services, according to the report.
While it is useful to have the percentages, Agran said he still demands a full report from the power authority to see which businesses changed their plans, since not all accounts are consuming the same amount of energy.
“[The report] tells you how many customers stayed in the 100 percent tier, but it doesn’t tell you which [specific businesses] opted out or opted down,” he said.
For example, Irvine Ranch Water District—the city’s biggest energy consumer that spends tens of millions a year on electricity—opted out already, leaving the agency with mostly smaller businesses, he said.
“Most businesses are small businesses which might use $500 a month in electricity. But if [Irvine Ranch Water District] is out of the picture, [that’s a big difference]. They might use, I don’t know, $10 or $20 million a year in electricity,” he said.
Agran has been asking—since September 2021—for a “full disclosure of all pre-launch costs and expenditures” on the Orange County Power Authority, in which Irvine has invested $7.7 million of its taxpayer funds, though the request has been unable to get a “second” from his council colleagues for it to move forward.
“In [Irvine’s] joint powers agreement with [the agency], we as a city are authorized anytime during this calendar year to conduct an audit of all prelaunch costs and expenditures, and we should do that.”
