SAN FRANCISCO (Map, News) - Although environmentalists and some residents of The City's southeast sector expressed reservations about a proposal to build a new fossil fuel burning power plant in Potrero Hill, members of the San Francisco Public Utilities Commission board approved the plan Wednesday after learning that Mayor Gavin Newsom’s office had reached a deal that would shut down the older, more polluting plant in the same neighborhood.

In the works for years, opponents of the plan say the plant would still be bad news compared to utilizing renewable sources. Commissioners have echoed similar concerns.

The new $225 million, 150-megawatt power plant — which would eventually be city-owned — would utilize combustion turbines, or CTs. In an October 2006 decision on the CT project by the California Energy Commission, it would boost energy reliability in San Francisco, while “discharging lower levels of [nitrogen oxide] compared with the existing, older generation facility.”

On Tuesday, the Board of Supervisors voted 8-3 to support the new power plant proposal, after being told that Newsom’s office had reached a deal with the Mirant corporation, the owner of the older plant in which Mirant would shut down the plant after the new plant is up and running and the state removes the older plant's “must- run” contracting status.

“It was the missing piece that a lot of folks were rightly concerned about,” said SFPUC spokesman Tony Winnicker on Wednesday, after the SFPUC board also voted to move forward with the Combustion Turbine plant.

SFPUC board members said additional changes to the deal, including guidelines that would limit the new power plant’s uses for reliability purposes only, made it easier to accept.

Now approved, SFPUC staff will work to finalize a contract with Illinois-based J-Power USA Development Co. to build the new plant in Potrero Hill. The contract could be before the Board of Supervisors for approval, a required step, by Thanksgiving, Winnicker said.

beslinger@examiner.com