ALJ WEISSMAN: On the record.

This is the time and place for the public participation hearing in application 98-01-008. And what we're here to discuss tonight is a draft environmental impact report that's been distributed for review and comment dealing with PG&E's applications to complete an option process for the sale of some fossil plants that are located either within or not far from the San Francisco Bay Area. And the purpose tonight is very specifically to hear from those who have had an opportunity to review all or some portions of the draft environmental impact report and would like to have an opportunity to present oral comments about the quality or concerns related to the content of that draft.

And I'll talk a little bit more about the process that we're going to go through in a few minutes, but what I'd like first to do is to introduce Bruce Kaneshiro, who is the project manager for the environmental branch of the Commission and is overseeing the consultants. And he'll provide a brief overview of the process that we've undertaken up to this point in preparing the draft environmental impact report, and talk a little bit about the issues covered in that report.

Bruce?

MR. KANESHIRO: Thank you, Your Honor.

Well, for those of you who are not familiar with what this draft EIR is studying, it's essentially the sale or transfer of ownership of three fossil fuel power plants that are owned by PG&E and one geothermal power plant that's located north of here in Sonoma and Lake County.

Essentially the draft EIR is looking at potential environmental impacts that will result from this transfer of ownership. The key focus of the draft EIR is operational changes, in other words, what would happen if a new owner took over these power plants. Would they operate them differently, would they operate them more than PG&E would if PG&E retained them, would they operate them less. So, the EIR really looks at operational differences between a new owner and if PG&E were to continue to own the plants.

And taking that premise, we then took the EIR and looked at specifically what types of impacts that would have, the operational changes would have on topics such as air quality, geology, water quality, cultural resources, pretty much a whole list of environmental issues that are usually looked at in an EIR. We also looked at cumulative impacts of this project and alternatives to this project. Essentially, could the project objectives be achieved in some other fashion than how PG&E currently proposed. So, that is a little bit of background of what's in the document.

Just to give you some procedural background, PG&E came in with its application to sell these power plants in January of this year. In August, the Commission released its draft environmental impact report for public comment. We had four public information meetings over the last several weeks where we've tried to explain the document, summarize the document in a way that's understandable to the public so that comments on the document would be focused. And we tried to eliminate misunderstandings or tried to make clarifications about what's been said in the document.

Tonight, as Steve said, or as ALJ Weissman said, this is an opportunity for the public to provide oral comments on the draft environmental impact report.

September 21st, next week, Monday, is the close of the public comment period. And once that occurs, the energy division staff will be responding to all the comments that come in, whether they be oral comments or written comments. And that will then finalize the EIR. That report will have an attachment that will include all the comments that were submitted, as well as all of our responses to those comments. And sometime in the winter, the Commission is then expected to certify this document and then make a decision on PG&E's application to sell the power plants.

So, that's a little bit of background and what's happening. And I will turn it back over to Steve.

ALJ WEISSMAN: Thank you.

Off the record again for a moment.

ALJ WEISSMAN: On the record.

Again, what we're providing is an opportunity tonight to reflect on the draft environmental impact report and offer comments. As I think you know, there's also an opportunity to provide comments in writing. And after making your remarks tonight, you might still want to consider doing that. And that's fine. But anything that's said tonight will be taken down by the court reporter, and that transcript will be made available to the consultants. And any issues that you raise in your comments tonight will be addressed directly in the final environmental impact report. I just want to emphasize that there may be a temptation to use the opportunity tonight to talk more generically about the merits of the divestiture proposal. Tonight we really want to focus on the EIR. And to have the greatest impact in terms of your comments, I would encourage you to focus as much as you can on that document.

So, if there aren't any questions, then I'd like to ask those who are speaking to come up to the lectern when your name is called, identify yourself, and spell your name for the court reporter. And then try to, if you can, confine your comments to five to seven minutes. I'll let you know when you've reached five minutes and you can think about wrapping it up at that point.

So, let's start with -- is it Joe Como? Mr. Como, come forward.

MR. COMO: Thank you, Your Honor, Commissioner.

My name is Joe Como, C-o-m-o. I am with the Golden Gate University Environmental Law Justice Clinic, representing the Southeast Alliance For Environmental Justice. My comments will focus on the Potrero power plant sale portion of the project and I will provide detailed comments to back up the points I will be making tonight.

[Begin 1-1]

The EIR seriously underestimates the amount of additional pollution and health problems that will be caused by the project. Particulate matter pollution is a serious concern that is hardly addressed, and illness from the particulate matter pollution is probably the greatest current pollution problem in the area surrounding the Potrero power plant. PM-10 concentrations are already nearly twice the state standards. All of the new particulate matter coming from the power plant will be the most dangerous type of particulate matter, the type that is less than 2.5 microns in size. The City Department of Public Health says that these small particulates have the greatest impact on health, especially among African-American children. African-Americans make up sixty-one percent of the neighboring Bayview/Hunters Point area.

The report indicates that PM-10 will increase with increased power and generation. The new owner will have an economic incentive to increase power as much as possible to make sure that the ISO does not approve any new transmission lines.

[End 1-1]

[Begin 1-2]

There is no mention of secondary PM-10 that is produced from nitrogen oxide. This will also substantially increase the amount of particulates in the area.

[End 1-2]

[Begin 1-3]

Health studies indicate that over one thousand people per year in the Bay Area died from PM-10 exposure, and that this whole project will increase mortality by approximately 15.6 people per year. Even with this information, the EIR says that the impact is less than significant. This is a position we certainly cannot support.

[End 1-3]

[Begin 1-4]

Ozone impacts are not addressed, even though the Bay Area does not meet the ozone standard. And the Potrero plant will substantially increase the amount of chemicals in the atmosphere that makes ozone.

[End 1-4]

[Begin 1-5]

The EIR concludes that carbon monoxide and sulphur oxide concentrations will not increase, even though the amount of carbon monoxide produced will increase substantially. This is hocus pocus science with no explanation.

[End 1-5]

[Begin 1-6]

The EIR discounts the pollution problems through inadequate investigational techniques, selective data presentation, and insufficient compliance with CEQA regulations, guidelines and legal principles.

[End 1-6]

[Begin 1-7]

There's no air quality baseline for the vicinity of the Potrero plants. CEQA says that an EIR must describe the environment in the vicinity of the project as it exists before the project from both a local and regional perspective. No air quality data has been collected from the area downwind of the power plant. The background inner quality monitoring station is on the corner of 16th and Arkansas, over one mile upwind of the Potrero plant. Generally air quality data from this location does not represent local air quality in the Potrero or Bayview/Hunters Point neighborhoods for most of the year. In fact, the Arkansas Street station really measures air quality from Highway 101 in the Mission District. CEQA requires the CPUC to gather air quality data in the neighborhoods to be affected.

[End 1-7]

[Begin 1-8]

Information on air monitoring in the draft EIR is grossly insufficient. There does not appear to have been any attempt to verify that the model works to predict the current air quality situation. So much of the EIR relies on the results of the air monitoring, yet the document is insultingly simple in its description of the model results. Is the CPUC saying, trust us because the information is coming from a computer?

[End 1-8]

[Begin 1-9]

Bayview/Hunters Point residents live downwind from the Potrero plant at times of the year, yet no mention is made of how the project may affect them. No information is presented on the expected concentrations of pollutants in the neighborhood. The information should be in the form of maps showing concentration gradients for individual air pollutants from different times and different meteorological conditions.

[End 1-9]

[Begin 1-10]

Cumulative effects are not evaluated correctly. The EIR uses the logic that cumulative effects are insignificant because the Potrero plant would contribute only a small percentage of the regional pollution for all sources. This logic has specifically been rejected by the California Court of Appeals. The ratio theory of impact analysis allows a large pollution problem to make a project contribution appear small and, taken in isolation, appear insignificant. The report ignores the severity of the project's contribution. In fact, the more severe the existing environmental problems are, the lower the threshold should be for the project's cumulative impacts to be considered significant, so says the Court of Appeals.

[End 1-10]

[Begin 1-11]

The report's health risk assessment does not analyze the increased mortality from particular emissions, the occurrence of which is well-documented.

[End 1-11]

[Begin 1-12]

The EIR does not analyze all reasonably foreseeable project impacts. The EIR must evaluate all applicants with the assumption that the new owner will repower, as suggested in the EIR, and that a new power plant will or may be located next to the existing Potrero plant.

[End 1-12]

[Begin 1-13]

In conclusion, the California courts have required an EIR to contain enough information for the public to follow the reasoning of the decision-makers and to allow the public the opportunity to make an independent, reasoned evaluation of the data upon which the public agency will rely. This draft EIR does not comply with CEQA requirements. It ignores the fact that more pollution will be produced in an area already affected by chemicals in the environment and attempts to present only information that supports its conclusion of no significant impact.

[End 1-13]

ALJ WEISSMAN: Thank you, Mr. Como. I do have one question for you. You talked about what appeared to be your disagreement with the assessment as to where the cutoff point should be for a significant impact and a not significant impact. How would you suggest that the EIR should define that threshold?

[Begin 1-14]

MR. COMO: Well, one way, which is actually already in CEQA guidelines and was recently approved by the Office of Administrative Law, is to consider the current regulatory threshold, where if it's not exceeded would make an impact considered not significant. The alternative to that is that if it does exceed a threshold, then it should be considered significant. The EIR points out that at the Arkansas Street station, the twenty-four hour PM-10 threshold is already exceeded. And, as a matter of fact, it's nearly twice the state standard. And the project, although it will contribute a small amount, still exacerbates that antecedent. So, that is one area.

There generally is not enough information in the EIR to even evaluate some of the other major pollution concerns such as ozone, sulphur dioxide, carbon monoxide. So, it's very difficult to evaluate the EIR when there isn't even enough information to even evaluate what is reasonably considered significant and what isn't.

[End 1-14]

ALJ WEISSMAN: Thank you. Appreciate your comments tonight.

Mr. Yazgan?

MR. YAZGAN: Thank you. My name is Ahmet Yazgan and I am with CAPIT, Community Abatement of Pollution And Industrial Toxins. I live in Bay Point. This is where the other PG&E plant is scheduled to be sold. I would like to concur with the previous speaker. Most of the things that I wanted to cover, he has, so I'm going to try to go to other places.

[Begin 2-1]

But I'd like to emphasize first of all on the impact of the people living around the plant. It is no surprise that these plants that are being opened, especially around Pittsburg/Bay Point, that most of the people that are living there are maybe speaking another language as their native language. They may not be able to express their desires about the way that they want to live without pollution and clean air. So, this is why many companies now have chosen around the Bay Point/Pittsburg area to put their most dirtiest, most polluting plants. And we can see that PG&E is not the only one that is being dismantled or will be sold. But other companies are moving in and they are claiming that they are better because they pollute less than PG&E, which does not help the people of Contra Costa County because, no matter what, they are adding more to the pollution, more to the pollution that's already coming from Martinez from the oil refinery, more pollution from other dirty industries that already exist there.

[End 2-1]

[Begin 2-2]

One thing that I would have liked to see in the environmental impact report is the alternatives. I have been look at the CPUC's brochures where they keep on saying that their goal is to maybe reduce the demand for electricity. This Saturday there was a fair in Pittsburg. The new companies that are coming in are already trying to give out the first month free electricity to those who would be signing. I fail to see how a market system can actually reduce the demand for electricity when that is the goal of CPUC. And I fail to see how clearer technologies would be moving in when the new plants that are going to be opened up are with so-called natural gas. That is a fossil fuel. No mention of solar. No mention of other alternatives that are actually clean is ever being mentioned. There is an official name for this, it's called environmental racism.

[End 2-2]

[Begin 2-3]

I'd like to emphasize that.

The preparation of the environmental impact report has been done by a private company. I am kind of embarrassed to even say this, but we have to see that as the deregulation goes on, more private companies are moving into this and they have an interest, being private companies, on assisting each other. So, that's why that also brings a shadow to the environmental impact report.

[End 2-3]

That's what I'd like to say. Thank you.

ALJ WEISSMAN: Thank you very much for coming tonight.

Are there others in the audience who would like to make a comment?

MR. DONOVAN: Yes.

ALJ WEISSMAN: Off the record.

ALJ WEISSMAN: On the record.

Mr. Donovan?

MR. DONOVAN: Thank you, gentlemen. My name is Robert Donovan.

[Begin 3-1]

My comments on the EIR, starting from the back, Section 4-14-1, Cultural Resources, construction to separate the properties is misspelled.

[End 3-1]

[Begin 3-2]

Section 4-12-5, it says that there is no projected significant increase in the communication system. If you refer back to 4-14-1, it says in the third line, construction to separate the properties is probably going to happen. Any construction generally means that you're going to need telecommunications like phone lines. Construction trailers, they always need phone lines.

[End 3-2]

[Begin 3-3]

Page S-36, Section 4-9-3, PG&E shall provide the new owners with other documentation. It doesn't specify that the new owners have to know about CAL OSHA requirements and that they have a working relationship with agencies like the San Francisco Fire Department or any other county hazardous waste material agents.

[End 3-3]

[Begin 3-4]

And then the second to last one is also under hazards, 4-9-1. It specifically says that they'll prepare a risk assessment. It sounds like a risk assessment is an EIR and it won't be subject to review. And it makes one wonder if the risk assessment will be done by PG&E or by a consultant who will have no responsibility to report back to you if you don't like their risk assessment.

[End 3-4]

[Begin 3-5]

And then in the last section, 4-7-2, it says something about Section 10 and describes a letter. That sounds like an excuse to avoid responsibility. They're going to sell the properties and then allow the permits to expire perhaps, as it's written here, and then the new owners will state in a letter to the permitting agency that they would prefer to operate without any provisions of permission, they're just going to do it provisionally. Doesn't sound very responsible. But perhaps PG&E needs to make more profit than they already are.

[End 3-5]

And so the best way to do that is to divest themselves of these four properties that are not very profitable. Perhaps the Public Utilities Commission could address that issue as to why they shouldn't be allowed to make a profit.

Thank you.

ALJ WEISSMAN: Thank you very much, Mr. Donovan.

Mr. Ventresca?

MR. VENTRESCA: Good evening, my name is Joel Ventresca; I'm chair of San Franciscans for Public Power. We're a public interest organization. It goes back to 1979 in the city. My remarks are focused on the Potrero power plant issues.

[Begin 4-1]

The draft EIR, and it was emphasized in one informational workshop that was held here in San Francisco County several weeks ago, laid out the possibility of the Potrero power plant being repowered and then a second, new power plant being built in the general area north of the Martin substation. And this is obscured in the draft EIR. It's very confusing. And if that is the case, then what we need is clear data in the draft EIR that shows what kinds of omissions would occur with a repowered power plant by a new owner, then a second new power plant in the general vicinity, and what kind of environmental impact that would have on air quality. So, that's one issue.

[End 4-1]

[Begin 4-2]

Another issue is on page 4.5-27. There's an annual wind chart for the Potrero power plant. And I'd like to request that you superimpose over that chart the nearby residential neighborhood. I mean, you are showing wind direction. And any emissions of any existing power plant or any future power plant would show wind direction, but you are not clearly showing where the nearby residential neighborhoods are. And I think that in order to inform the public, it would be useful to put that in there.

[End 4-2]

[Begin 4-3]

Another point is, the Potrero power plant, you have historical data for the criteria air pollutant emissions and historical data for the toxic air contaminant emissions. For the first, for the years '95, '96, '97. And for the latter, the air contaminant emissions, you have data for '87, '90, '92 and '95. That same kind of data needs to be put in the draft EIR for the Hunters Point power plant, which is about a mile away on the shoreline, on the waterfront, it's around the same neighborhoods of Potrero and Bayview/Hunters Point. That same kind of data needs to be included for the Hunters Point power plant because on page 5-3, in a footnote, it's clear that the Hunters Point power plant may continue to operate through the year 2007. So, it would be very useful to have the historical data -- the historical data that you have for the Potrero power plant, present the same kind of data for the Hunters Point power plant in light of the fact that it could be operating another nine years, or nearly a decade into the future.

[End 4-3]

[Begin 4-4]

Now, in terms of the alternatives that were examined, I'd like to suggest that there be two other alternatives that be examined. One is the alternative where both power plants, the Hunters Point power plant and the Potrero power plant, a mile apart, same shoreline, same neighborhoods being affected, one of the plants goes back fifty years, and there's considerable evidence that shows that there's increased disease and health problems in the nearby neighborhoods, residential neighborhoods. So, one alternative that should be examined is, what if both plants were to be closed without any replacement, what would -- what would be the infrastructure changes that would be necessary to make that happen. There would have to be an expansion of the transmission lines into San Francisco, approximately how much would that cost. Could there be a private/public partnership in developing that new infrastructure. And maybe the City and County of San Francisco, which runs a public power system, maybe they would be interested in adding that infrastructure to their power system. But I think that whole alternative of both plants being phased out, being closed, with no replacement, what could be done to make that happen.

San Francisco is a very compact, small city, surrounded by water on three sides. There could be a legal and a moral argument made that, since you have so many people compact in such a small area, that building repowered or new fossil fuel burning power plants, wherever you put it, you're going to be affecting the health of the nearby residents. A case could be made that we shouldn't have power plants like this in the city limits of San Francisco. So, that should be an alternative that should be examined.

[End 4-4]

[Begin 4-5]

Another alternative is the strong possibility -- the City and County of San Francisco, which has a water and power system in place that goes back many years, may pursue eminent domain after the sale of the Potrero power plant twenty-six acre site, to condemn it, take it for public benefit with the city's intention of to either phase it out very quickly or to close it as quickly as possible. So, there would not be a market incentive by presumably a global energy company that would want to come in, buy the site, repower it, build a bigger power plant and create more emissions and the deteriorating health would continue in the area. So, the city -- I mean, irregardless of the secret deal that was cut between the mayor of San Francisco and PG&E behind closed doors, the deal says that the city could still use eminent domain after the sale. And the city may be doing that in the future. There either could be an initiative by the populace to get the plant closed, or there could be political pressure placed on the board of Supervisors and the mayor to exercise our rights of the City and County of San Francisco to use our power of eminent domain to take the site and close it down.

Now, before a repowering or a new power plant being built on the site, a case could be made in court that it would have very little value. And that might get the price down where the city would go into court, use eminent domain, get a market value price that's realistic, and then have the city buy and phase it out quickly or close it down very quickly. That alternative needs to be examined. And that would be a process that the city could pursue, even with this agreement that was reached between the mayor and PG&E. So, I would hope that that alternative would be examined as well.

[End 4-5]

Thank you.

ALJ WEISSMAN: Thank you, Mr. Ventresca.

Is there anybody else who would like to make a comment?

Okay hearing none, I want to thank you very much for those of you who came out tonight, coming out during these sacred hours of the evening, and especially those of who had to travel to get here.

This information is going to be incorporated in the review process that the staff and consultants will undertake in terms of looking at the comments to the draft environmental impact report. And I know that the Commissioner and I look forward to seeing the comments and changes in response to these suggestions that's reflected in the final document. And with that, this session is adjourned.

Thank you for being here.