Project Manager: James. W. Reede, Jr.

Staff Counsel: Jeff Ogata

Hearing Officer: Susan Gefter

Presiding Member: Commissioner Robert Pernell

AFC Filing, Data Adequacy, Project Description, and Economic Justice.

On March 8, 2000, Applicant EM-One Power Station filed the Nueva Azalea Power Plant Project AFC. The Commission declared the AFC data inadequate on April 26, 2000. It was not found to be data adequate until August 9, 2000. EM-One was owned by Sunlaw Energy Corporation, a company that had previously filed and withdrawn two Small Power Plant Exemption cases with the Energy Commission in the 1980s.

The proposed Nueva Azalea Project was a nominal 550-megawatt (MW), natural gas-fired combined cycle merchant power plant. The chosen location was a 13.5-acre site in the City of South Gate, Los Angeles County, five miles south of downtown Los Angeles. There were large numbers of residents nearby, including a trailer park, and public facilities such as a school. A freeway also bordered the small industrial site.

The applicant had chosen to place its powerplant in the middle of a low-income African-American and Latino area, which guaranteed that this would be a controversial case presenting the issue of economic justice. The City of South Gate itself, with a population of 100,000 has a Latino majority.

Nationally, the traditional use of low-income communities of color as a dumping ground for unwanted facilities had spawned a major resistance movement. Under the banner of "economic justice", first raised to the CEC in the San Francisco Energy case, Docket No. 94-AFC-1, public interest law firms and environmental organizations now vigorously fought against projects such as Nueva Azalea. Communities for a Better Environment (CBE), a grass roots leader in this movement, thus intervened to oppose the project. The applicant would now face more than just unhappy neighbors, because CBE provided lawyers, technical experts, and organizers to work with local opponents. The City of Downey also intervened, expressing serious concerns about air pollution from the project.

Nueva Azalea gave every indication that it could be a Southern California version of the massively contested Metcalf proceeding in San Jose, Docket No. 99-AFC-3.

Issues.

Project opponents intended to challenge Nueva Azalea on issues such as air quality, pollution in general, public health, noise, alternatives, socioeconomics, waste management, and economic justice, among other subjects. The applicant believed its facility would have no adverse impacts, and claimed that, thanks to new pollution control devices, the air coming out of the powerplant's stacks would be cleaner than the existing heavily polluted air in the project area. Sunlaw was the owner of the SCONOx system for reducing nitrogen oxide emissions (NOx) emissions. The applicant intended Nueva Azalea to showcase the feasibility of SCONOx, which was still considered unproven for large powerplants.

The Advisory Referendum.

Given the harsh reaction against Nueva Azalea from nearby residents, both the applicant and the South Gate City Council were now in difficult positions. It was unclear whether Nueva Azalea actually had support from the city government, even though the city would clearly gain financially from the powerplant being built. Some South Gate Councilmembers were already on record as opposed to Nueva Azalea. Yet the applicant believed its project was favored by the majority of people living in the City of South Gate, and wanted to demonstrate this to the South Gate City Council.

The result was a unique political device, a non-binding advisory referendum, in which the City of South Gate voters would be asked whether they favored Nueva Azalea. A vote in favor of Measure A expressed support for the powerplant, while a "no" vote meant opposition. (Not since SANDER, Docket No. 85-AFC-4, had an AFC been placed on a local ballot. That measure was an initiative by project opponents to kill the powerplant, which San Diego voters passed after the applicant had already withdrawn. The anti-SANDER initiative was essentially uncontested.)

The Nueva Azalea campaign over Measure A would be quite different from SANDER. Sunlaw actively campaigned in favor of its powerplant, spending a significant amount of money promoting a "yes" vote. The opponents lacked applicant's bank account, but fought back with door-to-door community organizing.

With the South Gate Mayor and Vice Mayor conducting a hunger strike to protest Nueva Azalea as part of the "No on A" Campaign, South Gate voters went to the polls on March 6, 2001. Measure A and the Nueva Azalea powerplant lost by a margin of 2 to 1.

Sunlaw then publicly announced that it would heed the will of the voters and not build Nueva Azalea in South Gate. Sunlaw claimed there were numerous communities interested in becoming the project's new home. However, applicant's statement to the Energy Commission was slightly different.

On March 12, 2001, the applicant sent Commissioner Pernell a letter asking that the Nueva Azalea AFC be suspended because Measure A had been defeated. A suspension of up to six months was requested so the applicant could reconsider its options for Nueva Azalea. No subsequent CEC staff work has been done on the project, and it is unclear whether Nueva Azalea is dead or just dormant. The Nueva Azalea AFC remained suspended for most of 2001. Rumor had the applicant considering other, less hostile, alternative locations for this powerplant, or attempting a comeback at the old site. However, the Nueva Azalea project was finally withdrawn on November 5, 2001. It is currently the only 12-month merchant plant AFC that failed to be licensed.