How San Francisco Continues its Advance Toward Public Power

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.

The Our City, Our Power campaign will showcase the benefits of the City’s multi-billion-dollar offer to purchase PG&E assets and absorb the costs of one of the state’s oldest electric systems—allowing PG&E to make needed statewide investments in safety and reliability.

City leaders are united behind this endeavor led by Mayor London Breed, City Attorney Dennis Herrera, the Board of Supervisors and the SFPUC.

San Francisco City Hall.

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. 

Side view of San Francisco skyline at sunset, California, USA.

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 catalogs 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 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 under-investment 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.

Bay Bridge and San Francisco cityscape taken from Treasure Island.