San Francisco Peakers Face CEC Scrutiny

San Francisco?s plan to install 146 MW of peaking power adjacent to Mirant Energy?s Potrero Power Plant near the San Francisco shipyards will face scrutiny by the California Energy Commission for potential seismic, air-quality, public health, and other environmental risks. ?Today is just the first teeny step in a long process,? commissioner James Boyd pledged at a May 7 site visit and public hearing in San Francisco. Boyd said he was particularly concerned about liquefaction and geologic hazards in the event of a major earthquake since the project site is located on mud-fill next to San Francisco Bay. Officials from the San Francisco Public Utilities Commission (SFPUC) expect the three gas-fired turbines to come on line in June 2007, provided permits are approved by the Energy Commission, San Francisco, and other regulatory agencies. Their goal is to provide enough replacement power so that the city?s two aging, polluting power plants?Potrero and Pacific Gas & Electric?s Hunters Point plant?can be shut down, capping a decade-long campaign by local residents. The three peakers, and a fourth to be located at San Francisco International Airport, along with 14 transmission upgrades that PG&E is constructing, are aimed at ensuring that San Francisco has a reliable power supply and relieving transmission congestion. That will enable the California Independent System Operator to release the Potrero and Hunters Point plants from their reliability-must-run contracts, officials said. ?The ISO is extremely concerned about reliability of generation in San Francisco,? said Karen Kubick, SFPUC project manager. In November, CAISO approved a revised action plan for San Francisco that spelled out the conditions and timetable for releasing the two aging plants from their RMR agreements. PG&E signed an agreement with San Francisco in 1998 committing the utility to shutting down Hunters Point when the city no longer needs the power. Mirant officials have said they will shut down the Potrero plant as well when the RMR contracts are terminated. Without the guaranteed reservation fees and power payments from the RMR contracts, the two inefficient plants will no longer be economic or lucrative to run, officials said. Community leaders noted that the city could force Mirant to close Potrero by rezoning the area for redevelopment or offer economic incentives as an enticement to close the plant. San Francisco officials characterized the electric reliability project as a big win for the city, which is getting the turbines free of charge as part of the state?s $417 million settlement with Williams Energy Marketing. San Francisco officials are negotiating a 10-year power-purchase agreement with the California Department of Water Resources so that the revenue will pay for the capital costs of constructing the plant. PG&E will distribute the DWR power to customers over its grid. After 10 years, DWR will turn the plant over to the city as San Francisco?s first municipally owned power plant. When commissioned, the project will expand the city?s portfolio beyond the hydroelectric power generated by the Hetch Hetchy Department of Water and Power. The SFPUC is trying to develop solar power and other renewables projects with the San Francisco airport, the Department of Public Health, and other city agencies, she said. The SFPUC expects the peakers to land on a four-acre industrial site on property owned by the city after their initial plans to install the turbines on Mirant?s land fell through. SFPUC officials said the site is the optimum location since much of the infrastructure is already in place and it is near a PG&E substation and major gas line. A 115 kV switchyard will be built next to the turbines and a 900-foot-long pipeline laid to connect with PG&E?s gas line. The power lines will be laid underground, and wastewater from the plant will be discharged into the city?s combined sewer and storm-water system. ?We?re following the letter of CAISO?s action plan. The city worked really hard with CAISO to pin them down,? Kubick said. The project team plans to conduct an extensive geotechnical investigation and is considering installing piles below each major piece of equipment to reinforce it and prevent sinkage. Community representatives demanded that the Potrero and Hunters Point plants be shut down before the peaking combustion turbines are installed. Residents noted that no one?not the city, CAISO, nor the CEC?has any authority to compel Mirant to shut down the Potrero Power Plant. Indeed, Mirant may well want to keep the plant operating if there?s another power crunch and power prices spike again in California, making it profitable to keep Potrero running, they argued. The San Francisco Board of Supervisors has made it clear to the SFPUC that its final approval of the combustion turbines will hinge on Potrero being closed and no longer needed for reliability, Kubick said. While the turbines would emit substantially less nitrous oxide than Potrero or Hunters Point, they would double the PM10 emissions, which have caused greater public health impacts in the area, said intervenor Bob Sarvey. The turbines would emit 0.07 pound of PM10s per megawatt-hour, compared to 0.03 pound of PM10s from Potrero and Hunters point, he said. Kubick stressed that the turbines are intended to operate only as needed to provide peaking power. Hence, their emissions will be substantially lower than those of Potrero and Hunters Point, which are baseline power plants.

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San Francisco Peakers Face CEC Scrutiny

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