The authors, an ad-hoc group of professionals with experience in regulatory and energy economics, share a common concern with the continuing turmoil facing the electricity industry ("the industry") in California. Most of the authors endorsed the first California Electricity Manifesto issued on January 25, 2001. Almost two years have passed since that first Manifesto. While wholesale electric prices have moderated and California no longer faces the risk of blackouts, in many ways the industry is in worse shape now than it was at the start of 2001. As a result, the group of signatories continues to have a deep concern with the conflicting policy directions being pursued for the industry at both the State and Federal levels of government and the impact the uncertainties associated with these conflicting policies will have, long term, on the economy of California.

The authors have once again convened under the auspices of the Institute of Management, Innovation and Organization at the University of California, Berkeley, to put forward our their ideas on a basic set of necessary policies to move the industry forward for the benefit of all Californians and the nation. The authors point out that they do not pretend to be "representative." They do bring, however, a very diverse range of backgrounds and expertise.