Published By: Communications and Public Outreach
Long-Term Retirement of All In-City Fossil Fuel Plants, Review Underway of Alternatives to Combustion Turbine Project That Will Also Guarantee Electric Reliability for San Francisco
San Francisco, CA: The San Francisco Public Utilities Commission (SFPUC) unanimously endorsed an alternative proposal on Tuesday to meet San Francisco’s long-term energy reliability needs. If adopted, the proposal would allow for the near-term retrofit of the existing diesel-burning Potrero Power Plant peakers – with the goal of reducing emissions and improving Bay water quality – and the eventual retirement of all fossil-fuel burning electric generation in San Francisco.
The Commission endorsed retrofitting the existing energy infrastructure at the Potrero Power Plant as its preferred alternative to the City Combustion Turbine (CT) Projects, provided that the retrofit is structured to satisfy the following criteria:
- Improvement in air and water quality over the current operations at the Potrero Power Plant site and comparable to the expected operations of the in-City portion of the CT Projects in the form in which it was proposed to the Board. Achievement of a particulates mitigation and community benefits program equal to or better than the corresponding benefits program proposed in connection with the in-City portion of the CT Projects.
- No operation of the units, or “dispatch,” other than for reliability, except on agreement of the City.
- Improvement in financial terms and risks to the City as compared to those proposed in connection with the CT Projects.
- Binding covenant to decommission each generating unit once it is no longer needed for reliability.
Mirant California (Mirant), the owner of the Potrero Power Plant, issued a report that analyzed the feasibility, engineering requirements, permitting steps and requirements, timeline and costs to convert their existing Potrero Power Plants 4, 5, and 6 to dual fuel capability and add updated pollution control technology, thereby significantly reducing emissions.
SFPUC Commission staff will perform further investigation and assessments regarding the retrofit alternative and the Mirant report, and will report back to the Commission as to their findings.
Background
In 2005, the City reached an agreement with the California Independent System Operator (CAISO) – the state agency that monitors and oversees California’s energy grid and electric reliability – that outlined the key steps necessary to close both the Hunter’s Point and Potrero Power Plants.
In 2006, the old Hunters Point Power Plant closed upon completing the new Jefferson-Martin Transmission line up the Peninsula.
To fulfill the requirements, as outlined in the CAISO Action Plan, to remove the “must run” requirement that allows the Potrero Power Plant to stay in business, in July and October 2007, respectively, the SFPUC adopted Resolution Nos. 07-0137 and 07-0188, authorizing the General Manager of the Commission to complete negotiations and execute agreements to develop and construct four CT Projects.
Earlier this year, in a letter to Mayor Gavin Newsom, CAISO indicated that upon completion of the Transbay Cable project, Potrero Unit #3 could be shut down.
On June 24, 2008, the San Francisco Board of Supervisors approved a resolution urging Commission staff to submit to the CAISO a plan for a transmission-only solution to the closure of the Potrero Power Plant.
And on July 1, 2008, Mirant issued a report that analyzed the feasibility, engineering requirements, permitting steps and requirements, timeline and costs to convert their existing Potrero Power Plants 4, 5, and 6 to dual fuel capability, including the installation of the necessary emission control equipment and emission monitoring system.
In light of these recent developments, the Commission has endorsed a plan that could provide a bridge to elimination of any additional fossil fuel generating facilities in San Francisco, while, in the near term, reducing emissions and improving Bay water quality. The Board of Supervisors is scheduled to consider the CT project again on July 15, 2008.
