SFPUC rescinds prior authorizations for in‑city combustion turbines, urges sale of turbine units

The San Francisco Public Utilities Commission voted unanimously on July 22 to rescind earlier commission resolutions that had been interpreted as authorizing new in‑city combustion turbine power plants and to endorse retrofit and transmission alternatives as the city—s preferred path forward.

Commissioner Stephen Sklar, who introduced the resolution and a friendly amendment, said the package "clears away any vestige" that prior votes authorized a combustion turbine (CT) plant and urges the mayor and Board of Supervisors to initiate sale of CT units received under the Williams settlement so the city can "optimize the portion of the sales proceeds accruing to the city." Sklar said the units may fetch roughly $72 million on the open market and noted that the original settlement had provided $10 million to the city with the remainder going to state parties.

The commission and staff described outstanding transactional steps with the California Independent System Operator, Mirant and PG&E that must be completed to lock in a retrofit and to ensure that retrofitted units would be operated only for reliability and emergency purposes. The general manager cautioned commissioners that several agreements remain to be finalized but said staff had issued a July 18 letter outlining the path forward and saw no insurmountable obstacles.

Public commenters representing environmental and neighborhood groups welcomed the action. Espinaldo Jackson, speaking for Bayview Hunters Point, said the decision relieved community members who had feared increased local pollution. John Rizzo of the Sierra Club said the committee's decision would set a statewide example. Several speakers urged staff to accelerate sale of CT units before a November ballot measure takes effect.

Commissioners framed the action as a closing of one chapter and a move toward cleaner alternatives. Commissioner Hakim said retrofitting existing units is "about 75% less polluting on an annual basis and $200 million less expensive than the original proposal," and urged the commission to learn from the process and improve earlier outreach. Commissioner Clark and others called for careful negotiations with DWR and state counsel to seek a larger city share of proceeds, while acknowledging the city may be constrained by the original settlement and state role in any sale.

The motion passed with no recorded nays. The commission recorded that the action rescinds prior July and October resolutions related to the CT project and includes the amendment recommending that the mayor and Board of Supervisors initiate sale of the combustion turbine generators and seek to maximize the city's portion of proceeds.