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District Two Metcalf Energy Center Advisory Committee (MECAC) Report to the City of San Jose Planning Commission and City Council on the proposed General Plan Amendment, Planned Development Pre/Rezoning, and Annexation by Calpine/Bechtel Enterprises for the Metcalf Energy Center

November 9, 2000

DISTRICT TWO METCALF ENERGY CENTER ADVISORY COMMITTEE
(MECAC)

COMMUNITY REPRESENTATIVES:

George Aboud - President, Los Paseos Neighborhood Association

Darcy Becker - Community Resident

Cecilia Dirstine - President, California Maison Homeowners Association

Jeff Dixon - Santa Teresa Action Group

Mike Tatarakis - Community Resident

Anne Catherine Vinickas - Community Resident

Jeff Wade - Santa Teresa Action Group

BUSINESS REPRESENTATIVES (COYOTE VALLEY & CITY-WIDE):

Terry Bradford - Coyote Discount Bait & Tackle, Inc.

Rebecca Elliot - Board of Realtors

Joe Cassisi - American Society of Mechanical Engineers

Margaret Leathers Sidener

Dan Stockton - Chief Operating Officer, Great Oaks Water Company

EDUCATION REPRESENTATIVE:

Jackie Adams - Trustee, Oak Grove School District

ENVIRONMENTAL/OPEN SPACE REPRESENTATIVE:

Lorrie Landis - Community Resident

Introduction

The District Two Metcalf Energy Center Community Advisory Committee was created by Councilmember Charlotte Powers to conduct a comprehensive study, review and analysis of the proposed Calpine Metcalf Energy Center. This committee identified key issues, topics and concerns. It coordinated its efforts with state and local agencies such as the California Energy Commission (CEC) and San Jose Planning Department. By participating in joint workshops with the CEC, the committee was able to gather information directly from industry experts and professionals, plus receive feedback from neighborhood residents and associations. Throughout this process, the committee has developed an understanding of the issues facing the City of San Jose. This report contains an overview of the process, project, and recommendations.

Overview

The Metcalf Energy Center proposal is one of the most complex issues to ever come before the City of San Jose. The implications range far beyond the city limits. California is entering the unfamiliar territory of a deregulated electrical industry. At the state level, the new relationship between the state agencies, the Independent System Operator (Cal-ISO), PG&E and energy providers, such as Calpine, is relatively new and still developing. Due to deregulation, the CEC's role is being reexamined and the process, which is primarily for a regulated industry, is currently being reviewed. For the City of San Jose, the explosion of high tech industries has given rise to tremendous growth throughout the city. The expansion into Coyote Valley, set aside in 1985, is now a reality and such growth must be implemented responsibly and as planned. Finally, new technology is developing in the electrical generation industries. All these factors play in a role in the Metcalf proposal. Any decision made will have far and long ranging effects on the future of San Jose.

Committee Process

The committee members were chosen to provide council district representation, allow for participation from interested parties and facilitate technical understanding. The group contained District Two residents, representatives from Realtors Association, American Lung Association, Neighborhood Associations, Environment, and Engineers. The committee process was designed to allow members the opportunity to hear from the applicant, technical experts and the local residents. Members were given access to all of the documentation submitted by the applicant and interveners. All CEC Staff documentation was made available as well.

The CEC Siting Process is designed to be approximately 12-14 months long from the date of the Application For Certification (AFC). The CEC Siting Process is CEQA compliant. All meetings, such as information workshops and Commission Hearings, are held publicly. State and local agencies such as the Bay Area Air Quality District and City of San Jose Planning Department participate actively in the process. The public was encouraged to be involved throughout the entire process and can become an official party to the process by applying to the CEC to be an "Intervener". Interveners are private parties who legally participate together with the CEC and the applicant. While the committee never applied collectively to be an intervener, they were kept informed by the CEC and city staff on a regular basis. One member of the committee filed as an intervener. Many other members of the community also filed to intervene, resulting in 30 official parties, more than in any other case before the CEC.

The AFC was submitted in April 1999. Beginning in June 1999, the committee met on a regular basis for the next twelve months as the project has progressed. Most of the meetings were held in conjunction with the CEC workshops and Commission Hearings. All meetings were conducted in a public forum except for internal planning meetings. The first meeting was held on June 17, 1999 with an introduction of the committee members, an overview of the project from the applicant and an overview of the process from the CEC staff. Subsequent meetings covered such topics as air quality, visual impact, land use, transmission, public health and biological resources. The minutes and results of these meetings can be found in the CEC website, http://www.energy.ca.gov/sitingcases/metcalf, or upon request through Councilmember Powers office. Throughout the entire process, city Planning staff stayed involved facilitating committee requests to the CEC, coordinating committee support and providing information as requested on the General Plan and other Planning processes. The CEC Staff FSA was published October 10, 2000. Just received recently, its comments were considered in this report.

Project Description

As defined in the CEC Staff FSA Project Description:

The Metcalf Energy Center (MEC), is a nominal 600-megawatt (MW), natural gas-fired, combined cycle electric generation facility. The proposed site is located partially in the City of San Jose and partially in the County of Santa Clara near Highway 101 in the south part of San Jose. The site lies at the southern base of Tulare Hill in northern Coyote Valley to the west of Monterey Highway and south of the Metcalf Road intersection. The 20-acre site is currently zoned for agricultural uses by both the city and county. Calpine/Bechtel's proposed power plant design consists of two 285-MW combustion turbine generators (CTG), each equipped with steam injection power augmentation capabilities; two heat recovery steam generators (HRSG) with duct burners; a single 235 MW condensing steam turbine generator; a mechanical draft (wet/dry) plume-abated cooling tower; and a 230-kilovolt (kV) switching station. The combustion turbine trains will include 145-foot exhaust stacks at the southern end of the site and step-up transformers, HRSG units, steam turbine generator units and their transformers, and water treatment and cooling towers. Additional facilities proposed as part of this project include an administration building with control room, storage tanks, parking area, water treatment building, a switchgear building and a warehouse/maintenance shop. The proposed power plant is adjacent to existing PG&E transmission lines that are connected to the Metcalf Substation. Electricity generated by MEC will be delivered to the transmission grid via a new 230-kV transmission line approximately 240 feet in length. The overhead transmission line will connect into PG&E's existing 230-kV Metcalf-Monte Vista No. 4 line which runs east-west along the northern edge of the project boundary. Calpine/Bechtel proposes to use approximately 2.9 to 5.8 million gallons a day of recycled water for cooling purposes from the San Jose/Santa Clara Water Pollution Control Plant as part of the South Bay Water Recycling Program. This will necessitate the construction of a new 10.2-mile recycled water supply line (the "SBWR Route"). A combined industrial wastewater and sanitary sewer line (less than a mile in length) will be constructed along Fisher Creek to the City's existing sanitary sewer line that runs along Santa Teresa Boulevard. Fresh water will be supplied either by the San Jose Municipal Water System or Great Oaks Water District from wells located in Coyote Valley. The applicant also proposes to build a new 16-inch diameter fuel gas pipeline from the MEC to PG&E's existing Line 300, a major natural gas transmission line along the eastern side of US 101.

The FSA Project Description also includes transmission, emission and cost information. It can be found in its entirety at the CEC website, http://www.energy.ca.gov/sitingcases/metcalf, or at any local public library.

Advisory Committee/San Jose Issues

The Advisory committee was specifically concerned with significant adverse impacts associated with the application and the proposed project. The CEC has regional and statewide focus while the City of San Jose has a more specific responsibility to focus on the best course of action for its residents along with the needs of the state. For that reason, the land use and visual resource impacts are the focus of this summary along with some specific City of San Jose perspectives that are not addressed by the CEC's FSA.

Land Use

As stated in the CEC Staff FSA:

The San Jose 2020 General Plan contains each of the elements mandated by Government Code Section 65302 (land use, circulation, housing, conservation, open space, noise, and safety). The elements have been combined into "a consistent meaningful whole" and organized to meet the needs of public officials, developers, neighborhood organizations, and community members. The General Plan contains a statement of development policies and includes a Land Use Diagram and text, which set forth the objectives, principles, standards, and plans to guide development proposals. The General Plan states that it "must always be considered in its entirety, with no single policy, principle, standard, or plan read and considered in isolation. It is also necessary that the General Plan provides some flexibility and not be applied or interpreted in such a rigid manner as to impede attainment of its objectives" (SJ 1994a, pp. 2-3).

The current General Plan Designation for the proposed site is Campus Industrial. Calpine has applied for a General Plan Amendment asking for a change to Public/Quasi-Public. The request is not consistent with the 2020 General Plan. A key item of concern is the possible effects on future development. The North Coyote Valley Master Plan specifically outlines the development for the area. Although growth has been slow in the past, the move by businesses into the 16.6 million square foot area has begun (i.e., Cisco's 685-foot campus).

As stated in the NORTH COYOTE VALLEY CAMPUS INDUSTRIAL AREA MASTER DEVELOPMENT PLAN:

The City of San Jose's general goals for development of North Coyote Valley are: "1) to provide much-needed, large, single-user sites and; 2) by doing so, ensure the region's long-term economic health" (SJ 2000). While the Master Development Plan is not an ordinance, many of its provisions are included in Planned Development zonings and have the force of law (SJ 1985). The Master Development Plan includes Private Improvement Guidelines, which are "the concepts all development must incorporate. "The plan also sets forth development standards "which must appear, as a minimum, as part of all Planned Development Zoning approvals and Environmental Performance Standards which all development must meet.

The Master Development Plan reads:

Even the low intensity of development in the Campus Industrial areas of Coyote Valley will not preserve its rural character if the large setbacks, height restrictions and landscape concepts outlined in this section are not followed. The unusually restrictive nature of these guidelines is deliberate. North Coyote Valley will attract and hold the major 'high technology' users it is intended to accommodate only if there is a clearly established standard of excellence and a commitment to meet that standard. (SJ 1985)

These development guidelines are key. With few choices for future development left within the city boundaries, any decision to alter the General Plan is critical. That combined with the pressures to meet the needs of the explosive growth being experienced within Santa Clara County makes it a clear choice to follow the 2020 General Plan.

Riparian Corridor

San Jose's adopted Riparian Corridor Policy Study establishes a requirement for a 100-foot setback from the edge of riparian vegetation, or top of bank, whichever is greater. The policy also limits activities within the setback and corridor areas to ensure the preservation of the biotic habitat. While Calpine is proposing to enhance the setback area and corridor with new plantings, concerns remain about lighting, noise, and construction impacts.

Air Quality

The MECAC experienced contrasting views on the air quality impacts from Calpine's proposal. Some members of the group felt that the effect of MEC would be to reduce total air pollution in the entire bay area region by offsetting less efficient generation facilities and diesel "peaking" generators used during times of peak load. The contrasting view was that any older plants must be improved under Bay Area Air Quality Management District- BAAQMD "Rule 11-Reg 9" which requires a 90% reduction in air pollution by 2002, therefore not requiring "market forces" to reduce pollution.

The BAAQMD issued an assessment of MEC, which gave approval under its permitting guidelines. However it was quite evident at meetings that there was a high degree of neighborhood concern about the proposal to add significant air emissions to an area that is already out of compliance with respect to EPA limits for ozone, and particulate material. The FSA described various air quality impacts by pollutants such as nitrogen dioxide (NO2), carbon monoxide (CO), and suspended particulate matter (PM10), and addressed the various mitigations as proposed by Calpine/Bechtel in order to meet BAAQMD's regulations.

Visual Impact

The visual impact would come from two main areas, the height of the plant and the plumes. Other areas of concern would be the impact to visual aesthetics. The primary concern regarding the height of the plant is the two proposed heat recovery steam turbine generators (HRSG) with 145 - foot exhaust stacks (the General Plan height restriction is 95 feet). However, the General Plan allows for taller buildings if the height is intrinsic to the building's function. Therefore, HRSG heights can be found to be consistent with the General Plan.

Another major concern is the cooling tower steam plume. The CEC found large plumes would be visible 1095 hours per year, an average of three hours per day. The largest plumes would reach to over 564 feet, dwarfing the 315' Tulare Hill and visible for miles around.

According to the FSA, the proposed project would substantially reduce the visual character and quality of views of the site and its surroundings largely because of the power plant's mass, scale, height, and industrial character. In addition, the HRSG stacks protruding well above the tops of the HRSG screening, the catwalks on the stacks, the exposed topworks, tanks, and other elements of the power plant further add it its appearance as a power plant and contrast with its likely future setting.

Water

A major component of the proposed project is dependent upon the availability of reclaimed water. South Bay Water Recycling (SBWR) is currently capable of delivering up to 50 million gallons per day (mgd) of recycled water for irrigation and industrial uses. Current customers number approximately 225 with delivery of up to 10 million gallons a day.

Metcalf Energy Center (MEC) requires approximately 2.9 to 5.8 million gallons a day of recycled water that will be used for cooling purposes and will come from the San Jose/Santa Clara Pollution Control Plant as part of the South Bay Water Recycling Program. An extension of the recycled water system south from its current terminus at Senter Road and Capital Expressway is necessary in order to serve MEC. Appropriate infrastructure would need to be constructed to connect MEC to the system. It is San Jose City policy that new development is expected to pay for the infrastructure required to support the proposed project, and it is not anticipated that any public funds will be used to construct this project. South Bay Water Recycling has indicated its opposition to the approval of MEC if there are to be any major plant operations that will not use recycled water. The city-operated Municipal Water system currently provides services along Santa Teresa Boulevard and Bailey Avenue. However, Municipal Water would need to develop new potable water facilities to serve MEC for a 5 (mgd) peak demand.

Recommendation

That the City Council deny the General Plan change proposed by Calpine due to incompatibility with the current General Plan Designation for the entire area.

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