Council approves settlement over Mojave power stake with reporting requirement; members debate environmental and supply risks

The Los Angeles City Council on Nov. 27 approved, as amended, a settlement agreement that settles the city's contested bargaining over its interest in the Mojave power project and requires the Department of Water and Power (DWP) to provide periodic compliance reports and an assessment of the facility after roughly 18 months.

Background and vote

The ordinance before the council implements a negotiated settlement tied to existing contract language and the exercise of a first right of refusal by other project participants. Council members debated environmental cleanup obligations, the city's future power supply risk, and whether retaining a stake would help assure cleanup and preserve dispatchable power in the region.

An amendment requiring the DWP general manager to report periodically on consent-decree compliance and to return in approximately a year and a half to reassess the facility passed (roll call recorded as 13 ayes for the amendment). The final ordinance as amended passed on the council floor by a vote of 10 ayes and 3 noes.

Key figures and testimony

Brian Darcy (introduced in the meeting as a representative of utility employees) argued the council should not make decisions based on short-term fear of capacity shortages and urged the city to pursue renewables on DWP property and local distributed generation. "The repowering that's going forward ... increases the capacity under the Supreme Court decision," he told the council, and he urged the general manager to bring back a feasibility report on renewables and distributed generation.

Council member Bernstein explained that retaining a position in the project provided an insurance value and an opportunity to acquire additional interest if the primary owner could not complete cleanup and compliance obligations. City staff said Utah Power (an out-of-state participant in related projects) had already recalled 200 megawatts and could recall an additional 100 megawatts in the future, creating an operational risk if DWP did not secure dispatchable capacity. Henry Martinez, assistant general manager for power services, confirmed the 200-megawatt recall and the potential for an additional 100-megawatt recall.

Environmental oversight and cleanup

Community and environmental organizations (Grand Canyon Trust, Sierra Club and others) were noted in the meeting as participants in a consent-decree process intended to force cleanup and ongoing monitoring of environmental impacts at the Mojave site. Some council members argued that DWP's continued presence would help ensure cleanup, while others said moral authority alone does not guarantee better environmental outcomes.

What the council approved

- An amendment (moved by Council member Reyes, seconded by Council member Sikowsky) asking DWP to return with periodic compliance reports and to reassess the facility in approximately 18 months (amendment approved, roll call recorded in the meeting). - Final approval of the ordinance to implement the settlement as amended (final vote: 10 ayes, 3 noes). The council recorded the amendment approval (13 ayes) and the final ordinance approval (10-3).

Clarifying details recorded during debate

- Council members cited an "adjusted cost" figure discussed in staff presentations of about 2.7 cents per kilowatt-hour for power from the facility; by contrast, other project figures mentioned in the meeting (Delta) were cited at 3.8 cents per kWh. - Henry Martinez (assistant general manager, Power Services) confirmed Utah Power had recalled 200 MW and could recall 100 additional MW under contract terms; those recalls alter the city's supply calculations.

Next steps and oversight

The amendment requires the DWP general manager to report periodically to the council on compliance and to return for a reassessment after about a year and a half; staff told the council they would continue to evaluate ownership options and potential opportunities to increase the city's stake if other participants failed to meet cleanup or financial obligations.

Ending

Council members divided along environmental and energy-security lines during the debate: supporters cited insurance value and the opportunity to influence cleanup and ensure reliable supply; opponents urged a full divestiture and emphasized the environmental cost of older, higher-emission generation. The council adopted the amended settlement.