Press Release

Cal Water Activates Stage I of Its Drought Management Plan; Asks Customers to Reduce Water Usage by 10%

SAN JOSE, Calif.--(BUSINESS WIRE)--June 5, 2008--California Water Service Company (Cal Water) (NYSE:CWT) announced today that it has activated Stage I of its Drought Management Plan for its 24 operating districts and encouraged the two million people it serves throughout the state of California to reduce their water usage by 10%.

"We have been actively encouraging customers to conserve water for some time, and in fact will be implementing tiered rates in most of our service areas on July 1 that will reward conservation efforts. But this marks the first time since the last official drought that we've asked them to achieve a specific conservation target," said Paul G. Ekstrom, Cal Water's Vice President of Customer Service.

According to Ekstrom, Cal Water's public awareness programs include participation in Disney's "Environmentality" program, which includes classroom curriculum and radio messages throughout the state, as well as local efforts in each of its 24 districts. In May, the company hosted hundreds of customers at Water Awareness Festivals.

Cal Water also offers low-water-using fixtures and rebates to customers consistent with the California Urban Water Conservation Council's Best Management Practices.

"We support the Governor's effort to raise awareness about the importance of using water efficiently and investing in infrastructure to ensure adequate water supplies for future generations," Ekstrom said.

California Water Service Company (Cal Water) serves approximately two million people through 462,000 service connections ranging from Chico in the north to Palos Verdes in the south. The company has provided water utility services since 1926. Additional information for customers is available at www.calwater.com.

This news release contains forward-looking statements within the meaning established by the Private Securities Litigation Reform Act of 1995 ("Act"). The forward-looking statements are intended to qualify under provisions of the federal securities laws for "safe harbor" treatment established by the Act. Forward-looking statements are based on currently available information, expectations, estimates, assumptions and projections, and management's judgment about the Company, the water utility industry and general economic conditions. Such words as expects, intends, plans, believes, estimates, assumes, anticipates, projects, predicts, forecasts or variations of such words or similar expressions are intended to identify forward-looking statements. The forward-looking statements are not guarantees of future performance. They are subject to uncertainty and changes in circumstances. Actual results may vary materially from what is contained in a forward-looking statement. Factors that may cause a result different than expected or anticipated include but are not limited to: governmental and regulatory commissions' decisions, including decisions on proper disposition of property; changes in regulatory commissions' policies and procedures; the timeliness of regulatory commissions' actions concerning rate relief; new legislation; changes in accounting valuations and estimates; the ability to satisfy requirements related to the Sarbanes-Oxley Act and other regulations on internal controls; electric power interruptions; increases in suppliers' prices and the availability of supplies including water and power; fluctuations in interest rates; changes in environmental compliance and water quality requirements; acquisitions and our ability to successfully integrate acquired companies; the ability to successfully implement business plans; changes in customer water use patterns; the impact of weather on water sales and operating results; access to sufficient capital on satisfactory terms; civil disturbances or terrorist threats or acts, or apprehension about the possible future occurrences of acts of this type; the involvement of the United States in war or other hostilities; restrictive covenants in or changes to the credit ratings on our current or future debt that could increase our financing costs or affect our ability to borrow, make payments on debt or pay dividends; and, other risks and unforeseen events. When considering forward-looking statements, you should keep in mind the cautionary statements included in this paragraph. The Company assumes no obligation to provide public updates of forward-looking statements.

CONTACT: California Water Service Company
Shannon Dean
310-257-1435

SOURCE: California Water Service Company