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Local Power urges faster Clean Power SF build‑out; commissioners press staff on rates and Hetch Hetchy availability
Summary
Local Power Inc. recommended accelerating the Clean Power SF local build‑out, using Hetch Hetchy excess power and changing REC strategy to lower customer rates. Commissioners and staff stressed modelling of firm power availability, risk to ratepayers in dry years and legal/financing constraints for using Prop H bonds.
Local Power Inc. (LPI) presented an alternative strategy for the city’s Clean Power SF community choice aggregation program and urged the San Francisco Public Utilities Commission to accelerate a local distributed‑generation build‑out while adjusting the resource mix to reduce rate pressure.
Paul Fenn, LPI’s principal, said the firm’s proposal is "an acceleration of the local build out," integrating up to about 18 megawatts of Hetch Hetchy power and lowering reliance on higher‑cost renewable‑energy credits. Fenn recommended a shift in the REC strategy and use of Hetch Hetchy surplus power to reduce the program’s price premium and support a Phase I enrollment target of roughly 78,000 customers.
Commissioners and staff probed financial and operational risk. Todd Richstrom, CFO/Assistant General Manager, warned that Hetch Hetchy output is seasonal and not always "firm," explaining that when the utility has excess Hetch Hetchy power it has typically sold it "at about $0.04 a kilowatt hour," but in dry years staff has had to buy replacement power at substantially higher prices. "The pickle is when we have dry years," Richstrom said, noting that the system’s net surplus over a 10‑year period is limited and that firm, year‑to‑year availability cannot be guaranteed without additional storage, collateral or contractual hedges.
Staff and outside speakers also raised legal and financing constraints. Members of LAFCO and environmental groups urged speed on local build‑out but cautioned that Proposition H bond authority may be restricted from funding private projects and that siting and CEQA issues for cogen and larger distributed projects require careful vetting. "Prop H is public bonds, public funds," said Hope Schmelzer, a LAFCO commissioner and attorney, cautioning about private‑use limits and permitting hurdles.
Program timing and next steps: Staff clarified the presentation was informational; no votes were taken on the recommendations. Barbara Hale, Assistant GM for Power, said some day‑one offerings (GoSolar SF allocations and energy efficiency programs) will begin immediately and that larger utility‑scale local build‑out would scale with customer enrollment and demonstrated revenue. Staff said a fuller risk‑bounded financial model will be available in roughly three months.
Public reaction: Environmental groups and community advocates (Sierra Club, San Francisco Green Party, Restore Hetch Hetchy representatives) generally supported more aggressive local build‑out but insisted on clearer finance, legal and permitting analyses and faster hiring of a permanent CCA program director so staff can implement and coordinate build‑out plans.
The commission took the presentation and public input for further consideration ahead of future rate, contract and program decisions.
