In straight PSQL, variables cannot be used as table or column names.  You can get around that limit by building a statement and using EXECUTE STATEMENT to run it.  That has some slightly odd behavior in terms of security - my recollection is that the statement is run with the user's privileges not the privileges of the procedure.   The statement in an EXECUTE STATEMENT is not cached - it must be parsed, compiled, and optimized each time it runs.

Does that mean that if I'm going to update a sequence within a trigger or procedure, I should use the legacy gen_id() function instead of the 'alter sequence'?

-- 
Daniel