Exhibit 10.3

[Strategic Energy, L.L.C. Logo]

EXECUTIVE COMMITTEE
ANNUAL INCENTIVE PLAN
January 1, 2007

Objective

The Strategic Energy, L.L.C. (SE) Annual Incentive Plan (“Plan”) is designed to
motivate and reward team members to achieve specific key financial and business
goals and to also reward individual performance. By providing market-competitive
target awards, the Plan supports the attraction and retention of talent critical
to achieving SE’s strategic business objectives.

Eligible participants include all non-commissioned employees as approved by the
CEO & President (CEO) of SE.
 
Target Awards

Target award levels are approved by the Compensation and Development Committee
(“Committee”) of the Board of Directors and set as a percentage of the
participant’s base salary. Percentages will vary based on level of
responsibility, market data and internal comparisons.

Plan Year and Incentive Objectives

The “Plan Year” will be the fiscal year beginning on January 1 and ending on
December 31. Within the first 90 days of the Plan Year, the Committee will
approve specific annual objectives and performance targets that are applicable
to each participant. Annual objectives will include core earnings as a financial
objective weighted at 40% and relating to the earnings for the participant’s
primary business or as determined by the Committee; 40% reflecting key SE
business objectives; and 20% as an individual performance component. Each
objective is subject to an established threshold, target and maximum level. Each
participant will be provided a copy of the applicable objectives and targets
within the first 90 days of the year (see Appendix I). Objectives, thresholds,
targets and maximums for each Plan Year will be fixed for the Plan Year and will
be changed only upon the approval of the Committee.

Payment of Awards

Approved awards will be payable to each participant as soon as practicable after
the end of the Plan Year and after the Committee has certified the extent to
which the relevant objectives were achieved. The awards will be paid in a lump
sum cash payment, less applicable taxes.

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The size of an individual participant’s award will be determined based on
performance against the specific objectives and performance targets approved by
the Committee. Assuming the threshold level for core earnings is met, each goal
will pay out at 100% for target levels of goal performance; 50% for threshold
levels of goal performance; and 200% for a maximum level of goal performance for
the Core Financial and Key Business Objectives. For the Individual Performance
Objectives, assuming the threshold level for core earnings is met, pay out will
range from 0% up to 200% at the SE CEO & President’s discretion and approved by
the Committee, based upon discretionary measures with judgment made on personal
work progress. Awards will be extrapolated for performance between threshold and
target, and between target and superior levels. Individual awards will not be
paid if the threshold level of core earnings is not met.

The annual target award percentage of base salary is stated in the participant’s
original offer or information change letter. An award for a person who becomes a
participant during a Plan Year will be prorated unless otherwise determined by
the Committee. A participant who receives a salary or grade change in the Plan
Year will receive a bonus that is based upon months of service and salary as of
the effective change date. A participant who retires during a Plan Year will
receive a prorated award as of his or her retirement date unless otherwise
determined by the Committee. Prorated awards will be payable in the event of
death or disability of the employee. For prorating purposes, a participant hired
on or before the 15th of the month will receive credit for that month, and a
participant hired on or after the 16th of the month will receive credit in the
next month.

A participant must be on active payroll at the time of disbursement to be
eligible for payment. The Company may deduct from any award all applicable
withholding and other taxes.

Administration

The Committee has the full power and authority to interpret the provisions of
the Plan and has the exclusive right to modify, change, or alter the plan at any
time.

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ANNUAL INCENTIVE OBJECTIVES - 2007
APPENDIX I

40% of Payout
Core Financial Objectives
 
Weighting
50%
Threshold*
100%
Target
200%
Superior
1. Core Earnings (IBT)
40%
(1)
(1)
(1)
40% of Payout
 
Key Business Objectives
 
 
Weighting
 
50%
Threshold
 
100%
Target
 
200%
Superior
2. Originated Margin
20%
(1)
(1)
(1)
3. Project 2-3-0 Process
Improvement
10%
(1)
(1)
(1)
4. MWhs Under Management
10%
(1)
(1)
(1)
 
 
Individual Performance Objectives
 
 
 
Weighting
 
 
 
100%
 
 
 
150%
 
 
 
200%
20% of Payout
5. Employee annual appraisal
 
 
20%
 
Discretionary measure. Judgment made on personal work progress.

*If performance falls below the threshold, we will attribute 0% to that element
of the Annual Incentive Plan.
(1) Confidential information.
 
 
As amended April 30, 2007