WHEREAS, on January 17, 2001, I proclaimed a State of Emergency to exist due to the energy shortage in the State of California;

WHEREAS, there is a high probability that the shortage of electricity will continue to cause rolling blackouts throughout California affecting millions;

WHEREAS, significant conservation efforts are needed to mitigate the effects of this emergency;

WHEREAS, consumers will reduce their energy consumption if provided financial incentives and additional tools to promote energy efficiency in their homes; and

WHEREAS, it is estimated that an effective rate reward program can help reduce energy consumption by up to 3,500 gigawatt hours over twenty-four hours and up to 2,200 megawatt hours during critical summer peak consumption periods.

NOW, THEREFORE, I, GRAY DAVIS, Governor of the State of California, by virtue of the power and authority vested in me by the Constitution and statutes of the State of California, including the California Emergency Services Act, do hereby issue this order to become effective immediately:

IT IS ORDERED that the Department of Water Resources shall implement a limited-term rate reward program for conservation efforts by residential, commercial and industrial customers of electric corporations. Under this program, electric corporations shall provide rate reductions to consumers with credits of up to twenty percent of the customer's Summer 2001 bills for reducing electricity consumption by at least twenty percent during June to September 2001. The program will be financed through a reduction in the electric corporations' payments to the Department of Water Resources in subsequent months.

IT IS FURTHER ORDERED that the Public Utilities Commission is requested to direct electric corporations to submit programs to carry out this Executive Order and promote consistency in its implementation.

IT IS FURTHER ORDERED that the Department of Consumer Affairs shall incorporate this program into its media awareness campaign for maximum public participation.

IT IS FURTHER ORDERED that this order shall expire on December 31, 2001, unless extended or terminated earlier by a subsequent Executive Order.

I FURTHER DIRECT that as soon as hereafter possible, this order be filed in the Office of the Secretary of State and that widespread publicity and notice be given to this order.