EDITORIAL Working with environmentalist cover, Mayor Gavin Newsom and Pacific Gas and Electric Co. have moved aggressively to derail a move that would have given the city control over some local power generation. Instead, the mayor is now pushing to keep Mirant Corp. running the one electricity plant that still operates within city limits.
The politics of the deal are complicated, but the driving force is clear: PG&E didn’t want the city moving even a small step toward public power, and as usual, the big utility is getting its way.
The power plant deal proves exactly why Supervisors Ross Mirkarimi and Aaron Peskin should move forward with a November charter amendment for public power.
As Amanda Witherell reports, the San Francisco Public Utilities Commission has been trying for years now to win approval for three city-owned combustion turbines that would generate electric power at a plant at the foot of Potrero Hill. The idea: the turbines, also known as "peakers," would generate enough power during peak-use periods to convince the state to shut down the dirtier Mirant Plant.
Many environmentalists opposed the proposal, saying that the city shouldn’t be building any new fossil-fuel plants. That’s a legitimate argument. But California’s Independent System Operator (Cal-ISO), the agency that controls the electric grid, insisted that renewable energy alone wouldn’t provide enough reliable power for San Francisco, and said the only way to shut down Mirant was to put in the peakers.
PG&E has been trying for months to derail the peakers — not, of course, out of any concern for the environment, but because the city would own the power plants. At first Newsom stuck by his PUC — but after seven PG&E lobbyists came into his office and gave him the facts of life (see "PG&E offers Newsom a blank check" at sfbg.com), he backed down. And now, after meeting with the CEOs of PG&E and Mirant, Newsom is pushing the worst possible alternative: he wants to retrofit the Mirant plant and let the private company operate its own peakers.
Same fossil fuel plants in the Bayview. Same type of air pollution. And the facility would be owned by a private company.
The supervisors need to reject this proposal with extreme prejudice — and the environmentalists who fought the city peakers ought to be just as loud in their opposition to Mirant’s retrofit.
The good news is that this ridiculous Newsom–PG&E deal ought to put the focus at City Hall back on public power, because that’s the only way to create a really green power profile in San Francisco.
Matthew Wald, who has coved energy policy for decades, wrote an interesting piece in the New York Times June 8 discussing why no private company wants to invest money in technology that would reduce carbon emissions from power plants. "Cutting carbon dioxide emissions is a fine idea, and a lot of companies would be proud to do it," Wald wrote. "But they would prefer to be second, if not third or fourth."
That’s because no private utility wants to take the risks and try something new that another company could then copy. In economic terms, carbon reduction is a public good — it’s something that benefits everyone, and nobody has the exclusive right to make money off of it. Private companies have been notoriously bad at investing in public goods.
But that’s not how public power agencies work. A San Francisco power agency would have every motivation to develop and use technology that saves consumers money or protects the environment. There’s no issue of profits to protect; in fact, one of the mandates of a city agency should be reducing carbon emissions and promoting renewable energy.
We have always been sympathetic to the concerns that the city-owned peakers would emit greenhouse gases. But if the city owned the plants, the city could shut them down anytime, whenever enough renewables were available. Mirant won’t shut down anything that is bringing in cash.
Mirkarimi and Peskin are working on the details of a public power measure, but the outlines ought to be clear: it should mandate that the SFPUC create and implement a plan to put the city in the retail power business, in compliance with the letter and spirit of the Raker Act — and get rid of PG&E and Mirant. The supervisors should put that on the November ballot.