The East Bay Municipal Utility District (EBMUD) provides water to over 1.2 million customers in the San Francisco/Oakland area of California. Water consumption averages 220 MGD and peaks at 325 MGD. As part of the water operation, EBMUD generates and sells an average of 135 GWh of hydroelectric energy each year that is produced at its two hydroelectric power plants. Driven by the accelerating need for an Energy Management System (EM) and the impending full deregulation of energy prices, EBMUD has embarked on the procurement and installation of a pilot EM system. EBMUD plans to have the EM system operational as a pilot for a portion of its water system in mid 2000. This paper discusses the main components of the EM system and its expected results. Includes 3 references, figures.