By Rachel Brahinsky

Closely following the release of a study showing that East Bay energy customers could have lower rates and better service with public power, San Francisco is preparing for what may be the first full-fledged city government-sponsored public power hearing.

The local Feb. 22 hearing will be hosted by the San Francisco Local Agency Formation Commission and is a step toward a likely November 2002 public power ballot initiative. Last fall two such measures narrowly lost at the polls. Many attribute the loss to the lack of an economic study.

The East Bay study, by Sacramento consultant R.W. Beck, examines the costs of taking over part of Pacific Gas and Electric Co.'s system. The East Bay Municipal Utility District now provides water and sewer services to approximately 1.3 million customers in Alameda and Contra Costa Counties. The study concludes, "Under the most likely scenario, the cost benefits clearly exceed risks." Lower costs would result from eliminating stockholders and benefiting from "tax exempt financing on future systems additions."

Local public power proponents say the East Bay study is encouraging. "It's a motivational catalyst that validates San Francisco's second chance to vote for public power," said Ross Mirkarimi, who ran the 2001 public power campaign.

Public power experts expected to speak at next week's LAFCO hearing include California Power Authority chief S. David Freeman, San Francisco power chief Ed Smeloff, and representatives from the Sacramento Municipal Utility District.

The costs of municipalization depend on several unknown factors, including how much EBMUD customers will pay for the state's expensive long-term power contracts.

Still, proponents are encouraged. "R.W. Beck was extremely cautious, but even given that, we can see that moving forward as a public power entity is in everyone's best interest," Cynthia Wooten, founder of the Berkeley-based Citizens United for Reliable Energy, said.