Clean public power

IN 1997, long before the energy crisis hit, San Francisco experienced the first fallout of the energy-deregulation plan passed by the state legislature. Pacific Gas and Electric Co. proposed selling the Hunters Point power plant to AES Corp., an out-of-state energy company planning to retrofit the 35-year-old plant and keep it in operation.

The proposal generated fierce opposition in the Bayview and Hunters Point communities, which were dealing with a high incidence of asthma, breast cancer, and other serious health problems that can be attributed in part to stationary sources of air pollution like dirty power plants. Residents won a temporary victory: AES pulled out of the deal, and the city promised eventual closure of the plant in an agreement with PG&E, effective when the city's energy needs could be met in another way.

Then rates began soaring, rolling blackouts hit – and in the middle of the mess PG&E filed for bankruptcy protection.

Meanwhile, the Hunters Point power plant remains in operation. Residents are rightly fearful PG&E will invest large sums of money to bring the plant up to new state environmental standards – and then keep it running for years to pay off that investment. And Mirant Corp., which bought PG&E's other plant, at Potrero Hill, wants to expand that plant's capacity from 350 to 600 megawatts. While this new plant would allow for closure of the Hunters Point plant, it could result in a net increase of criteria pollutants in the Potrero community because of its size and the number of hours it would operate. Mirant – one of the companies implicated in gaming the California market – would also wind up with virtual monopoly control over the local market.

The rolling blackouts have ended, primarily because of consumer conservation efforts and the state's decision to enter into long-term power contracts. Unfortunately this decision also cut off opportunities for the development of cleaner, renewable energy resources by locking down the market. Assemblymember Carole Migden has introduced "Community Choice" legislation (A.B. 117) to address this problem. If passed, A.B. 117 would allow local communities to become "default providers" of power to their residents and businesses, essentially using the poles and wires of local utilities, while being responsible for other aspects of power service.

This is the complicated landscape in which the Board of Supervisors must decide to proceed with regard to public power.

Last year I helped lead a campaign to develop public ownership of the entire local energy system, provided that cost-benefit analysis showed a benefit to ratepayers. I worked strenuously to gain the support of the San Francisco Labor Council, consumer groups, and environmental groups for Proposition F on the November ballot, which would have created a San Francisco Municipal Water and Power Agency. We lost by only 533 votes.

I still display the Bay Guardian's Best Grassroots Campaign award on the shelf of my office – this was one of the most principled efforts progressives have undertaken together in recent history.

There were some casualties of the fight. The San Francisco Labor Council led the charge for public power with serious infusions of cash and volunteer recruitment, which I greatly appreciated. Other labor unions – specifically the International Brotherhood of Electrical Workers, Local 1245, and the San Francisco Building Trades Council – did not agree with Prop. F.

This year, after several months of drafting meetings that have included public power advocates, environmental justice advocates, and representatives of labor, environmental, and consumer groups, Sup. Sophie Maxwell and I have proposed a simpler version of Prop. F. The measure would:

• Replace the current San Francisco Public Utilities Commission (five members appointed by the mayor) with a seven-member commission, with appointments split between the Board of Supervisors' president and the mayor, and one from the controller, all subject to board confirmation.

• Require the city to develop resources and submit a plan to the state's Independent System Operator sufficient to close the Hunters Point power plant by 2005.

• Set a goal of building enough renewable-energy facilities for 25 percent of the city's needs by 2010.

• Allow the city to become a default provider of energy if Migden's bill is approved and, in keeping with the Raker Act, to deliver power to residents.

• Establish a professional rate-setting process for energy, which has requirements for low-income rate discounts and conservation incentives, including the ability to establish peak pricing (a longtime goal of environmental advocates and critical to shutting down the Hunters Point plant).

• Establish the right to issue revenue bonds for the construction of new energy facilities (including generation plants), the repair and replacement of energy facilities, and the acquisition of privately owned power plants (like the Mirant facility in Potrero Hill).

• Only allow use of revenue bonds to acquire PG&E's distribution grid if the city controller certifies that PG&E has interfered with the city's efforts to build clean power plants and act as a default provider.

First and most important, this proposal acknowledges that the highest priorities in energy policy for the city are closure of polluting power plants, development of renewable energy and less-polluting power-generation facilities to replace dirty power plants, and ensuring energy reliability to avoid blackouts.

In view of the environmental justice burdens placed on our low-income communities and communities of color, acquiring PG&E's grid – while it is a goal I obviously support – ranks second.

Second, this proposal relies on appointees to govern the agency, rather than on elected directors. Experience with elected directors in other communities has been decidedly mixed. For instance, for much of the history of the East Bay Municipal Utility District, developers have controlled the elected board of directors. In Sacramento the experience has been much more positive.

This, frankly, is an issue that can and should be revisited in the future. For now, I am confident that our plan will keep PG&E and downtown interests from controlling the commission.

If the Board of Supervisors decides to incorporate revenue-bonding authority to take over the grid, I suspect we will face opposition on four fronts: PG&E, Mirant, downtown, and organized labor (because of labor's need to maintain unity).

In the near term, I believe our most pressing need is to close PG&E's Hunters Point facility and then shut down the most polluting part of Mirant's Potrero plant. There is no price tag one can place on the public health impacts of air pollution. Risking this number-one energy policy goal in order to achieve longer-term consumer goals – particularly when we can achieve direct consumer benefits through ownership of power plants and by acting as a default provider – seems unwise to me.

If the board decides to pursue grid acquisition, I will stand with that decision. If not, it is my hope that public power advocates will stand enthusiastically with the southeast sector to right wrongs that have been plaguing those communities for a very long time.