He was blamed for a statewide energy crisis that was actually criminally engineered by Enron.
Enron amd Duke Energy certainly cashed in on and manipulated the deregulation debacle, but the way I remember it, it was engineered by former governor Pete Wilson and his pals at San Diego Gas and Electric along with PG&E and some of the other "for profit" electric utilities. (I was working for a public electric utility at the time)
They used the big hook of "pass this deregulation law and you'll be able to buy your electricity from what ever source you want and only payyour local provider a small "wheeling" charge to deliver it to you.
However, when they saw customers abandoning them enmasse for cheaper power, they got the brakes put on that provision of the law.
The big "for profit" power companies/generators bent California ove and ass-raped them.
Gray Davis took the hit for something that Pete Wilson foisted off on the public.