Editing Gray Davis (section)

====California electricity crisis====
{{Main|California electricity crisis}}
{{Main|Enron scandal}}

Soon after taking office, Davis was able to fast-track the first power plant construction in twelve years in April 1999, although the plant did not come on line before the electricity crisis.

According to the subsequent [[Federal Energy Regulatory Commission]]'s investigation and report, numerous energy trading companies, many based in Texas, such as [[Enron|Enron Corporation]], illegally restricted their supply to the point where the spikes in power usage would cause blackouts. [[Rolling blackout]]s affecting 97,000 customers hit the San Francisco Bay area on June 14, 2000, and [[San Diego Gas & Electric Company]] filed a complaint alleging [[market manipulation]] by some energy producers in August 2000.<ref name="Highest">{{cite news |url=http://www.sfgate.com/cgi-bin/article.cgi?f=/c/a/2000/12/08/MN148567.DTL |title=Highest Energy Alert: Stage 3 Emergency Rolling blackouts narrowly averted by shutting down huge pumps |work=San Francisco Chronicle |date=December 8, 2000 |access-date=2010-08-14 |first=David |last=Lazarus |archive-url=https://web.archive.org/web/20111227215157/http://www.sfgate.com/cgi-bin/article.cgi?f=%2Fc%2Fa%2F2000%2F12%2F08%2FMN148567.DTL |archive-date=December 27, 2011 |url-status=live }}</ref> On December 7, 2000, suffering from low supply and idled power plants, the [[California Independent System Operator]] (CAISO), which manages the California power grid, declared the first statewide Stage 3 power alert, meaning power reserves were below 3 percent. Rolling blackouts were avoided when the state halted two large state and federal water pumps to conserve electricity.<ref name="Highest"/>

[[File:Windmill Field outside Palm Springs, California.jpg|thumb|Windmill field outside Palm Springs. Hot temperatures were thought to be pushing California to rolling blackouts, though it was later discovered that market manipulation was the cause.]]
On January 17, 2001, Davis declared a state of emergency in response to the electricity crisis. Speculators, led by [[Enron|Enron Corporation]], were collectively making large profits while the state teetered on the edge for weeks and finally suffered rolling blackouts on January 17 and 18.<ref name="Highest"/> Davis stepped in to buy power at highly unfavorable terms on the open market, since the California power companies were technically bankrupt and had no buying power. California agreed to pay $43 billion for power over the next 20 years.<ref name="Highest"/> Newspaper publishers sued Davis to force him to make public the details of the energy deal.<ref name="Chain">[http://www.sfgate.com/cgi-bin/article.cgi?f=/c/a/2002/02/17/MN149246.DTL Governor's Race Gray Davis Energy crisis grew into ball and chain] {{Webarchive|url=https://web.archive.org/web/20090122231425/http://www.sfgate.com/cgi-bin/article.cgi?f=%2Fc%2Fa%2F2002%2F02%2F17%2FMN149246.DTL |date=2009-01-22 }} by Glendhill, Lynda. The San Francisco Chronicle. Sunday, February 17, 2002. Retrieved August 14, 2007.</ref>

During the electricity crisis, the Davis administration implemented a power conservation program that included television ads and financial incentives to reduce energy consumption. These efforts, the fear of rolling blackouts and the increased cost of electricity resulted in a 14.1% reduction in electricity usage from June 2000 to June 2001.<ref name="Highest"/>

Gray Davis critics often charge that he did not respond properly to the crisis, while his defenders attribute the crisis solely to the [[accounting scandals|corporate accounting scandal]]s and say that Davis did all he could. Some critics on the left, such as [[Arianna Huffington]], alleged that Davis was lulled to inaction by [[campaign contribution]]s from energy producers.<ref>{{cite news |last=O'Hehir |first=Andrew |url=http://www.salon.com/2001/01/27/power_4/ |title=Gov. Davis and the failure of power |work=Salon |date=2001-01-27 |access-date=2010-08-14 |archive-url=https://web.archive.org/web/20121009094744/http://www.salon.com/2001/01/27/power_4/ |archive-date=2012-10-09 |url-status=live }}</ref> Some of Davis's energy advisers were formerly employed by the same energy speculators who made millions from the crisis. In addition, the Democratic-controlled legislature would sometimes push Davis to act decisively by taking over power plants which were known to have been gamed and place them back under control of the utilities. Some conservatives argued that Davis signed overpriced energy contracts, employed incompetent negotiators and refused to allow electricity prices to rise for residences statewide much as they had in San Diego, which they argue could have given Davis more leverage against the energy traders and encouraged more conservation.<ref>{{cite news|url=http://www.findarticles.com/p/articles/mi_qa3827/is_200308/ai_n9286114 |archive-url=https://web.archive.org/web/20070324221436/http://www.findarticles.com/p/articles/mi_qa3827/is_200308/ai_n9286114 |url-status=dead |archive-date=2007-03-24 |title=Ten good reasons to recall Gray Davis |via=Find Articles |access-date=2010-08-14 | year=2003 }}</ref> The electricity crisis is considered one of the major factors that led to Davis's recall.

[[File:Gray Davis energy.jpg|thumb|left|Davis giving a speech on energy]]

In a speech at [[UCLA]] on August 19, 2003, Davis apologized for being slow to act during the energy crisis, but then forcefully attacked the [[Houston]]-based energy suppliers: "I inherited the energy deregulation scheme which put us all at the mercy of the big energy producers. We got no help from the Federal government. In fact, when I was fighting [[Enron]] and the other energy companies, these same companies were sitting down with Vice President Cheney to draft a national energy strategy."<ref>{{cite news |first1=Carla |last1=Marinucci |url=http://www.sfgate.com/cgi-bin/article.cgi?f=/c/a/2003/08/20/MN207450.DTL |title=Contentious Davis blasts GOP 'power grab' |work=San Francisco Chronicle |date=2003-08-20 |access-date=2010-08-14 |archive-url=https://web.archive.org/web/20090123033052/http://www.sfgate.com/cgi-bin/article.cgi?f=%2Fc%2Fa%2F2003%2F08%2F20%2FMN207450.DTL |archive-date=2009-01-23 |url-status=live }}</ref>

When the Enron verdicts were rendered years later, convicting Enron and other companies of market manipulation, Davis responded with the following quote:

{{cquote|[[Ken Lay]] and [[Jeffrey Skilling]], more than anyone, are the reason I'm talking to you now from this law firm.<ref name="bright"/>}} (Skilling's conviction was later overturned by the [[United States Supreme Court]] in its narrowing of the "honest services" statute.)

On November 13, 2003, shortly before leaving office, Davis officially brought the energy crisis to an end by issuing a proclamation ending the state of emergency he declared on January 17, 2001. The state of emergency allowed the state to buy electricity for the financially strapped utility companies. The emergency authority allowed Davis to order the [[California Energy Commission]] to streamline the application process for new power plants. During that time, California issued licenses to 38 new power plants, amounting to 14,365 megawatts of electricity production when completed.<ref name="Accomp."/>

In 2006, the ''[[Los Angeles Times]]'' published an article that credited Davis's signing of the long-term projects for preventing future blackouts and providing California a cheap supply of energy with the increasing costs of energy.<ref>[http://www.gray-davis.com/Page.aspx?PageID=62 Little risk to Schwarzenegger of blackouts, thanks to Gray Davis] {{Webarchive|url=https://web.archive.org/web/20070913112505/http://www.gray-davis.com/Page.aspx?PageID=62 |date=2007-09-13 }} by Kurtzman, Laura. [[Associated Press]]. Posted on Fri, July 21, 2006. Retrieved August 14, 2007.</ref>

In March 2003, the Federal Energy Regulatory Commission's long-awaited report on the so-called "energy crisis" was released. That report substantially vindicated Davis, laying the blame for the energy disruption and raiding of California's treasury on deliberate tactics employed by some 25 energy trading companies, most of which were based in Texas. Of the latter, the most notable was [[Enron]], a number of whose principals were subsequently criminally prosecuted for their roles.