SAN FRANCISCO (KCBS) – The discovery that the San Francisco Public Utilities Commission has quietly taken steps to eliminate all funding for CleanPowerSF, the stalled program to sell public power to city residents, has caused an uproar at City Hall.

The bomb dropped Thursday when Harlan Kelly, general manager of the SFPUC, revealed that money in a reserve fund created for the public power program would instead be spent on other green energy initiatives.

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Several on the Board of Supervisors Budget and Finance Committee cried foul at Kelly’s disclosure, putting him on the defensive.

“I do apologize for this sudden shock, but I felt that I had to come today and let you know what the final plan was,” Kelly said.

Last August, the commission voted to end a program in development since the turn of the century to increase the amount of renewable energy delivered to the grid in San Francisco from other local companies besides Pacific Gas and Electric.

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The SFPUC left open the possibility of resuming CleanPowerSF by holding $19.5 million reserve that Kelly now believes would be better spent on street lights and other capital improvements. The money will also fund GoSolarSF, an incentive program backed by the mayor.

“When you have the money on reserve, it is collecting interest at half a percent and we’re borrowing money for six percent,” Kelly said.

Supervisor John Avalos would not accept the agency’s deficit as an excuse.

“This is offensive to me,” Avalos said, later adding that CleanPowerSF had been a legislative priority on the board for more than 12 years.

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The committee voted Thursday to study the feasibility of joining Marin Clean Energy, a clean power program created in 2010 to meet a state law requirement that one-third of energy from utilities in California be derived from renewable sources.