COMMUNITY-CHOICE aggregation is not the final cure for San Francisco's energy problems. But it's a step in the right direction – and if the city takes it carefully, and does it right, aggregation could be a big boost for public power.

As Matthew Hirsch reports on page 14, a proposal now before the Local Agency Formation Commission (LAFCo) and headed for the Board of Supervisors would take preliminary steps toward creating roughly the equivalent of an electricity buyer's co-op. The city would buy power in bulk – from any of a number of suppliers, based on price and environmental quality – and resell it to residents and businesses, paying Pacific Gas and Electric Co. a fee for the use of company lines.

There are a number of obvious advantages: For one, PG&E would no longer be at the center of the city's energy system. The city would set rates, monitor service problems, and handle accounts. It could mean, for example, that low-income people might have an easier time getting service connected (and would be less likely to have their power arbitrarily turned off because of billing disputes). Rates could be adjusted to allow cheap power for the neediest (and most conservation-oriented users) and higher charges for, say, downtown companies that leave the lights on all night in empty high-rises. The city could decide, as a matter of public policy, not to buy power from nuclear plants – and to buy more from solar and wind producers, giving a boost to renewable-energy suppliers.

In the end, it would almost certainly be cheaper for consumers. In fact, two years ago, R.W. Beck, the respected Sacramento energy consulting firm, concluded in a report to LAFCo that San Franciscans could save as much as $30 million a year from an aggregation system.

But there are very real risks, too – and the supervisors need to clear them up before approving the plan.

For starters, the current proposal would put the city's Public Utilities Commission in charge of the program – and that's almost certainly a mistake. The SFPUC has never supported public power and has done everything possible to sabotage efforts to kick PG&E out of town. If this badly managed and antagonistic agency is allowed to run the power system, and then bungles the job, it will set public power efforts back decades.

San Francisco badly needs a department of public power, and this is a great opportunity to create it. The supervisors should move to establish a new agency (using money taken from the SFPUC's budget) to oversee community aggregation and lay the groundwork for a move to a full municipal power system.

In fact, it's essential that throughout the debate on aggregation, the supervisors and the public keep in mind that this should be only a temporary step along the road to a secure, environmentally sound, PG&E-free energy future. LAFCo and the board should continue to actively pursue the studies and political steps necessary to buy out PG&E's infrastructure (or build a new city system from scratch) and operate a fully municipally owned system.

Once this project gets underway, it's crucial that it be done properly, in the open. The agency that runs the aggregation program needs to hold regular public meetings and hearings and make all records and documents, particularly financial documents, available to the public without hassle or delay. There will inevitably be tricky pricing questions: Green power may cost more than fossil-fuel or nuclear options, and the city will need to explain, in a public meeting, precisely what those costs are, how the bids were handled, and what the long-term financial impacts are, and decide which approach to take. In the end, the supervisors – accountable elected officials – should have final say over electricity rates.

The city also needs to start lobbying, now, to make sure PG&E doesn't get away with steep "transition costs" by quickly signing long-term power-supply contracts that San Franciscans, even under a municipal system, would have to pay off. The supervisors should pass a resolution urging the California Public Utilities Commission not to allow PG&E to sign any new long-term contracts until cities like San Francisco, which are in the middle of pursuing community aggregation, finalize their plans.

LAFCo and the board need to move quickly on the next steps in the plan. The SFPUC, as usual, is trying to slow things down, but the only thing on the table right now is a proposal to seek bids from energy supplies. That's hardly a radical step, and it doesn't commit the city to anything. LAFCo and the supervisors should move forward, with all due dispatch.