John Upton/The Bay Citizen

The Potrero Generating Plant, pictured on Dec. 21, 2010, sits idle

Pacific Gas and Electric Company and residents of southeastern San Francisco scored a long-sought victory Tuesday when state power officials condemned a bayfront power plant to be demolished.

The much-maligned Potrero Generating Plant, an outdated natural gas-fired facility that scalds bay water and releases air pollution through a prominent smoke stack, has been switched off since late November because a comparable amount of electricity has been flowing into the city from the East Bay through the Trans Bay Cable.

The cable is a new $500 million underwater electrical line that can provide 40 percent of San Francisco’s power needs.

The California Independent System Operator, which oversees the electrical grid, on Tuesday told the Potrero neighborhood power plant’s corporate owner that the Trans Bay Cable and electrical improvements undertaken recently by PG&E mean that the facility’s controversial "must-run" designation is planned to be removed by the end of February. Must-run designations are applied to power plants that are considered essential for preventing blackouts.

Last year, San Francisco City Attorney Dennis Herrera secured a settlement agreement from Mirant Corp. — which purchased the power plant a decade ago from PG&E and recently merged with another company to form GenOn Energy — that compels the company to permanently shut down the plant once the must-run designation is removed.

“The Potrero units have played a critical role in meeting San Francisco’s local energy requirements,” ISO Chief Operating Officer Steve Berberich said in a letter Tuesday to John Chillemi, the president of GenOn California North. “With the Trans Bay cable and local transmission upgrade projects in commercial operation, the time has now come when the GenOn Potrero units are not (sic) longer needed.”

The prime waterfront land beneath the power plant will be redeveloped after the stucture has been demolished, but specific plans have not been formed, according to Chillemi. it's unclear when the Potrero facility will be demolished, and a substantial amount of environmental cleanup work will be required at the site.

The Potrero facility is the last fossil fuel-burning power plant remaining in San Francisco.

Operation of the 400-megawatt Trans Bay Cable will allow San Francisco residents and businesses to use electricity generated from fossil fuels without breathing the soot or fumes that are belched into the air when that power is produced.

East Bay communities, particularly those around Pittsburg where the cable ends, will now enjoy economic benefits but will suffer increased air pollution from nearby power plants because of San Francisco’s electricity use.

City, state, GenOn and ISO officials gathered Tuesday for a press conference in front of the power plant’s towering smokestack, which released steam and pollution into the atmosphere for decades but now sits idle.

The site has been used for various power-generation purposes over the past century.

“They were taking coal and they were basically converting it through a process that kept our street lights on in the 19th century,” San Francisco Mayor Gavin Newsom said during the press conference. “It was a big part of San Francisco’s industrial foundation, but it gets to a point where we turn our back to the old way of doing things and we proudly lift our heads to a new way of doing things.”

Under Newsom, two aging fossil fuel power plants have been shuttered in San Francisco's economically and environmentally disadvantaged southeastern neighborhoods, and a solar power plant was built in the city's Sunset District.

In May 2008, the city’s Board of Supervisors was on the verge of approving construction of a publicly owned $273 million gas-fired power plant in the Bayview neighborhood as part of an effort to close the nearby Potrero plant.

But on the week of the planned vote, Newsom withdrew his support for the project, pointing to its expected health impacts on low-income southeastern San Francisco residents. He eventually convinced the board to dump the power plant construction plan, which was strongly supported by many of the city's public-power advocates and had taken years to finalize.

Newsom’s change of heart followed a flurry of meetings with community activists and representatives of PG&E, which opposed the new plant. 

PG&E had worked in the lead-up to the scheduled 2008 vote to convince skeptical city leaders that the Trans Bay Cable and proposed rewiring projects could lead to the closure of the Potrero plant without requiring construction of a new in-city power plant.

Those recabling projects were completed in recent months, company spokesman Joe Molica said Tuesday.

The recabling projects replaced 10 miles of 115-kilovolt high voltage underground electric cables with higher-capacity cables, according to Molica.

“Numbers-wise, these new cables equate to approximately 100 megawatts of additional capacity,” Molica said in an e-mail.