San Francisco, CA
—After Governor Newsom recently demanded sweeping reforms to PG&E and said the utility, in its current form, “no longer exists,” and Senator Wiener’s bill announced this week to turn PG&E into a publicly-owned utility, the City and County of San Francisco has launched the Our City, Our Power, a new campaign highlighting San Francisco’s ongoing plans to take control of its energy future, acquire the local PG&E power grid, and shift to a cleaner, more reliable, locally controlled power system.
City leaders are united behind this endeavor led by Mayor London Breed, City Attorney Dennis Herrera, the Board of Supervisors and the San Francisco Public Utilities Commission (SFPUC).
“Local control of the entire San Francisco electric system will provide increased affordability, safety, reliability and accountability,” said Mayor London Breed. “Public power is aligned with the City’s aggressive clean energy and resiliency goals. Our offer benefits all parties involved and consistent with San Franciscan’s desire to move our city in a new direction through public power.”
As the debate expands in the state Capitol about a state takeover of PG&E—and other potential new models for providing energy in the 21st century—the new Our City, Our Power campaign will highlight the benefits of willing, committed communities like San Francisco taking on a greater share of California’s power burden. This reliable, time-tested model is already serving California consumers well in communities throughout the state, as has been recognized by state leaders in addressing PG&E’s bankruptcy. Governor Gavin Newsom has called for a state takeover if PG&E doesn’t substantially change, and Senator Scott Wiener introduced legislation February 3 to turn PG&E into a publicly-owned utility, with support from some San Francisco leaders, including Mayor Breed. This bill will protect the ability of local entities to provide their own utility service.
The City made a fair, thoroughly vetted $2.5 billion offer
in September 2019 to buy PG&E’s local electric infrastructure, and the Board of Supervisors and the San Francisco Public Utilities Commission on January 14 gave conditional approval to take the next step—authorizing up to $3.1 billion in revenue bonds
to fund the both the acquisition of local electric assets and cover related costs, including expanding personnel capacity and establishing operating reserves.
While PG&E executives have not yet accepted San Francisco’s offer, it remains an attractive financing option for PG&E as it struggles to exit bankruptcy—especially as Governor Newsom raises new questions about the amount of debt the utility has taken on to satisfy its creditors. San Francisco’s offer would provide a major cash infusion that PG&E could use to help pay wildfire victims and other creditors. It will also relieve PG&E of the cost of maintaining San Francisco’s aging local electric system—one of the oldest in PG&E’s system—allowing the utility to make much-needed statewide investments in safety and reliability.
The Our City, Our Power public information campaign will expand on this message: raising awareness among local residents and businesses, as well as policymakers outside San Francisco, about the improved service that will result from local public power—including lower costs, cleaner energy, and a safer and more reliable electric system, along with significantly improved local accountability from a locally-elected Board of Supervisors and Mayor.
Through its local public power system, the City already meets more than 70 percent of the electricity demand in San Francisco—powering San Francisco International Airport, the San Francisco Zoo, the San Francisco Public Library, Muni, City College, public schools, and San Francisco General Hospital. A recent poll found 70 percent of San Franciscans support switching to public power, along with the Mayor and every member of the Board of Supervisors.
The Our City, Our Power
website highlights the significant benefits to ratepayers in and out of San Francisco once the City operates its own power grid. In addition to a major infusion of funds PG&E can use to invest in needed regional transmission updates and other safety measures, a recent San Francisco Chronicle article documented substantial local cost savings as well. The article noted more than $148 million
the City’s local power programs have saved customers since 2016, compared to what they would have paid if they stayed connected to PG&E—while also tapping more renewable energy.
The Our City, Our Power website catalogues 64 recent cases of local projects experiencing interconnection delays and increased project costs as a result of ongoing PG&E disputes —on projects from homeless Navigation Centers and affordable housing developments to a children’s museum in Corona Heights.
“The City’s offer is a good deal for San Francisco, a good deal for PG&E and good deal for all Northern California residents,” said City Attorney Dennis Herrera. “These resources can be used by PG&E to compensate fire victims, reduce rates for remaining customers, and help PG&E refocus on the balance of its system outside San Francisco—where most of its customers live. Our city is only a tiny part—just 5 percent of PG&E’s service territory, and we are no longer willing to be held hostage by an unsafe, untrustworthy, and unreliable electricity provider. San Francisco’s public power system already provides more than 70% of the city’s electricity demand. We’re ready to take the next step to manage all of it under public power.”
The City’s offer and subsequent letters to PG&E and the California Public Utilities Commission demonstrate how thoroughly San Francisco has studied this issue. Its $2.5 billion offer was the result of nine months of extensive technical and financial analysis, conducted by City experts and outside advisers, including specialists in asset appraisal, financial feasibility, and engineering. Though PG&E’s underinvestment in San Francisco’s power grid and electrical infrastructure has left the City with some of the oldest power infrastructure in the state, City analysis shows these assets can be upgraded and perform much more efficiently and reliably through local public power.
The City also remains committed to ensuring competitive compensation and retirement benefits for local utility workers. The City has also released a letter highlighting how its local power plans could complement ongoing efforts by the Newsom Administration and state legislature to reform PG&E.
“The Our City, Our Power campaign will make it very clear that San Francisco is incurring millions of dollars each year in unnecessary costs as a result of PG&E’s control of our local power grid,” said Harlan Kelly, General Manager of the San Francisco Public Utilities Commission. “This campaign will be active in every community across the city. We are going to show San Francisco where and how we can modernize our system, and we’re going to demonstrate that public power is a better option than maintaining the status quo with PG&E.
For more information on the Our City, Our Power campaign and the next steps the City of San Francisco’s is taking toward public power, go to: https://www.ourcityourpower.org.
About the San Francisco Public Utilities Commission
The San Francisco Public Utilities Commission (SFPUC) is a department of the City and County of San Francisco. It delivers drinking water to 2.7 million people in the San Francisco Bay Area, collects and treats wastewater for the City and County of San Francisco, and generates clean power for municipal buildings, residents, and businesses. Our mission is to provide our customers with high quality, efficient and reliable water, power, and sewer services in a manner that values environmental and community interests and sustains the resources entrusted to our care. Learn more at www.sfwater.org.