By Matthew Hirsch

San Francisco representatives on the Local Agency Formation Commission will meet May 13 to continue a review of community-choice aggregation (CCA), a plan that would allow the city to compete with Pacific Gas and Electric Co. to provide local electric service.

The meeting will be LAFCo's third look at a pair of reports – one authored by the San Francisco Public Utilities Commission (SFPUC) and the other by citizen activist Paul Fenn – that say San Francisco can deliver cheaper, more reliable, and more environmentally sound electricity than PG&E.

At each of the previous hearings on CCA, LAFCo has gotten bogged down in its comparison of the two reports. They're different enough that LAFCo will have to choose which aspects of each to recommend to the San Francisco Board of Supervisors – or leave the choice entirely up to the board.

But over the past month, LAFCo has lost sight of several key facts:

. The city is already on record in favor of CCA;

. There are now two reports and an expert consultant's study that say San Francisco can benefit from CCA;

. For every day LAFCo continues to examine CCA, ratepayers in the city are left with just one choice for electric service – and that's PG&E.

CCA has never been done in California. There are only two programs like it in the entire country, one in Massachusetts and the other in Ohio, and San Francisco's goals include more green energy than either of them. So there's really no way to see exactly how it will all work.

It's for this reason – and because Fenn and Barbara Hale, the top energy official at the SFPUC, can't agree on key aspects of CCA – that the plan has been held up so long.

"Let me say I'm real skeptical," Sup. Jake McGoldrick, one of three LAFCo commissioners, said April 22 at the most recent LAFCo hearing. "When experts disagree, ergo be skeptical, and I hear experts disagreeing deeply."

Fenn and Hale clashed over just about every point the other made at the meeting.

Fenn said the city needs to move quickly to avoid a state-imposed surcharge that would kick in when PG&E signs its long-term energy contracts; Hale disagreed. Fenn's report has the city developing 360 megawatts of solar energy as part of his CCA proposal; Hale questioned whether that's a legal option. They also disagreed on how to set electric rates under CCA and even what form the CCA plan should take when it's sent to the California PUC.

"I think we need to take our active evaluation period here to make sure we have a clear understanding of the impacts, a clear understanding of the choices," Hale told LAFCo.

"I don't feel it's prudent for us to rush into modifying the provision of such an essential service," she added.

The decision LAFCo is struggling to make is not as dramatic as some seem to think, Fenn replied. "What we're doing here is not deciding to leave PG&E.... We're queuing up a request for proposals here."

In other words, the city would be signaling to suppliers in the energy market and the CPUC that it wants to establish CCA in order to compete with PG&E, Fenn explained. That would forestall state-imposed surcharges for PG&E energy contracts, which would increase the cost of electricity under CCA.

LAFCo would still have three months before contract proposals come in from energy providers and three months after that to review the proposals.

Essentially, LAFCo is now at the same point it was two years ago when Michael Bell, who works for the Sacramento-based energy consulting firm R.W. Beck, presented the commission with a study on CCA. Bell said that under the program, the city should expect an estimated $10 million to $35 million in annual savings over what residents and businesses are paying to PG&E.

The R.W. Beck study did not include city-owned hydroelectric power from the Hetch Hetchy reservoir or four combustion turbine generators acquired in a settlement with Williams Co., which could increase the value of CCA.

According to the R.W. Beck report, had San Francisco moved quickly to set up CCA, it could have been up and running by 2005.

Sup. Tom Ammiano said he and Sup. Ross Mirkarimi, the LAFCo chair, expect to meet with Hale and Fenn to hammer out the areas of disagreement.

"We need to go forward with alacrity," Ammiano told us.

LAFCo holds a special meeting to discuss CCA May 13, 2 p.m., City Hall, Room 263, S.F. Other items on the agenda include the PG&E valuation study and the PG&E franchise fee.

For more information and copies of all the CCA documents, go to www.sfgov.org/lafco. The CCA task force holds its first meeting Tues/9, 6-8 p.m., City Hall, Room 421. E-mail Matthew Hirsch at matthew@sfbg.com.