The plant is located near Albany Avenue and Main Street, close to Otay Elementary School.
The people of Chula Vista have spent years trying to stop MMC Energy from expanding. On Monday night, they voiced their concern at a public forum in front of the California Energy Commission.
Commissioner James Boyd agreed with the residents and announced his preliminary decision to deny the permit for the project.
But those who support the expansion said the new plant would meet higher environmental standards than the current facility and would more than double the current output during peak energy use in the area.