Exhibit (a)(8)

                              ILLINOVA CORPORATION
                          LEADERSHIP INCENTIVE PROGRAM

                        (Effective as of January 1, 1996)


Effective Date

The  Illinova   Corporation   Leadership  Incentive  Program  (the  "Plan")  was
established by Illinova  Corporation (the "Company")  effective as of January 1,
1996 (the "Effective Date").

Objectives

The objectives of the Plan are:

     o    To link  incentives  with  performance in order to encourage  improved
          Company performance.

     o    To focus attention on value enhancement for shareholders.

     o    To foster and  encourage  teamwork  at the  Illinova  Leadership  Team
          level.

     o    To motivate and reward performance above a planned or expected level.

     o    To attract and retain strong management personnel.

     o    To develop a more competitive compensation package relative to market.

Eligibility

The Chief Executive Officer of the Company (the "CEO"), in his discretion, shall
designate those management  employees of the Company who will participate in the
Plan  ("Participants")  for each Plan  Year,  which is the  calendar  year.  The
Participants  for each Plan Year will normally be designated by the CEO prior to
the beginning of the year.  If an  individual is designated as a Participant  in
the middle of a Plan Year, the  Participant's  award may be pro-rated based upon
the number of completed  months of service  between the date of eligibility  and
the end of the Plan Year.

Awards

For each Plan Year,  Participants will receive incentive payments for corporate,
business group and departmental  performance  that exceeds normal  expectations.
Determination of whether performance exceeds normal expectations for a Plan Year
shall be made on the basis of measurement of internal achievement levels against
the goals established under the Plan for the year.

Participants  will have the  opportunity to earn up to 14% of salary in any Plan
Year for achievement of corporate goals established for that year. Two levels of
Company  performance will be identified for each goal -- a threshold level and a
maximum level.  Attainment of any goal at the threshold  level for any Plan Year
will  qualify  for an award for that year with  respect  to that goal equal to a
percentage of the  Participant's  salary for the year times the weighting factor
(described below) for that goal.  Attainment of any goal at or above the maximum
level qualifies for the maximum award of 14% of the Participant's salary for the
year times the  weighting  factor for that goal.  Attainment  at a level between
threshold and maximum will result in a pro-rated award.

In addition,  Participants  will have the opportunity to earn up to 6% of salary
in any Plan Year for  achievement of business group and  departmental  goals for
that year ("variable  goals").  A Participant's  "Total Award" for any Plan Year
will equal the sum of the awards with respect to each corporate goal  (including
the award with respect to the discretionary category, if any) for the year, plus
the sum of the  awards  with  respect to the  Participant's  variable  goals.  A
Participant's  Total  Award  for any  Plan  Year  shall  not  exceed  20% of the
Participant's salary for the year.

Awards  under the Plan  shall not be  considered  part of a  Participant's  base
salary.  It is intended  that,  in  determining  whether such base  salaries for
Participants are at a competitive level relative to base salaries in the utility
industry, awards under the Plan shall be disregarded.

Goals

No later than the first meeting of the Company's Board of Directors in each Plan
Year,  the Chief  Executive  Officer of the Company (the "CEO") shall  establish
specific goals for corporate performance for that Plan Year. The corporate goals
(except for the  discretionary  performance  goal, if any) shall be the same for
all  Participants  with  respect to any Plan Year.  Goals  shall  focus on major
challenges  and issues  facing the  Company.  The goals shall  include  specific
performance  criteria that are determined to be vital to the  achievement of the
Company's long term strategic objectives.  A "weighting factor" will be assigned
to each of the goals that  recognizes  the relative  importance and influence of
the goal to the overall success of the Company.

Except as  otherwise  provided in the Plan,  the  corporate  goals for each Plan
Year,  and the manner of measuring  performance  against  those  goals,  will be
developed in conjunction  with the annual  planning and budgeting  activities of
the Company for the year.

In  addition to  establishing  specific  performance  categories  and  assigning
weighting factors to those  categories,  the [CEO] may establish a discretionary
performance  category for any Plan Year and assign a weighting factor to it. The
performance factors with respect to any such discretionary category for any Plan
Year shall be established by the Participant's business group leader at any time
before,  during  or after the end of the year.  The  level of  achievement  with
respect to the  discretionary  category for any Plan Year, and the award payable
with respect to that  category,  shall be  determined by comparing the Company's
performance  for the year with factors  that the  Participant's  business  group
leader determines to be appropriate measures of such performance.

The total of the  weighting  factors with respect to the  corporate  performance
goals for each Plan Year will equal  100%.  No awards  will be earned  under the
Plan with respect to the  corporate  performance  goals for any Plan Year unless
the Company has declared a dividend for that Plan Year.

Variable  goals  with  respect  to any  Plan  Year  will be  established  by the
Participant's business group leader prior to the beginning of the Plan Year.

Payment of Award

A  Participant's  Total  Award  for any  Plan  Year  shall  be made in two  cash
payments, known as the Short-Term Payment and the Long-Term Payment.

Subject to the following  provisions of the Plan, the Short-Term  Payment earned
for any Plan Year shall be made to the  Participant  in the first quarter of the
following year. A Participant's  Short-Term  Payment shall equal one-half of the
Participant's Total Award for the year.

Subject to the following  provisions of the Plan, the Long-Term  Payment for any
Plan Year shall be made to the  Participant  in the first  quarter of the fourth
year  following  the Plan  Year for which the  award is  earned.  The  Long-Term
Payment  earned for a Plan Year shall equal one-half of the Total Award for that
Plan Year,  increased  or decreased to the same extent that the value of a share
of Company common stock has increased or decreased for the Holding Period (based
on the  closing  prices of the  stock on the  first and last day of the  Holding
Period, and adjusted by the CEO to reflect stock splits and other  extraordinary
events) and further  increased to reflect  Dividend  Equivalents for the Holding
Period.  The "Holding Period" for a Long-Term Payment is the period beginning on
last  trading day of the Plan Year for which the payment was earned,  and ending
on the first trading day of the fourth year thereafter.

The "Dividend  Equivalents"  for a Long-Term  Payment for the Holding Period are
the  dividends  that would be paid  during the  Holding  Period on the number of
shares of common stock of the Company  that could be  purchased  with 50% of the
Total Award,  determined by dividing 50% of the Total Award by the closing price
of the stock on the first day of the Holding Period,  and adjusted by the CEO to
reflect subsequent stock splits and other extraordinary  events. For purposes of
determining  the  Dividend  Equivalents,  it is assumed that the  dividends  are
reinvested in a manner that is comparable to the manner of reinvesting dividends
set forth in Illinova  Corporation  Automatic  Reinvestment  and Stock  Purchase
Plan;  provided that dividends paid in the last six months of the Holding Period
shall  not  be  deemed  to  be  reinvested;  and  further  provided  that  if  a
Participant's employment with the Company and its affiliates terminates prior to
the end of the Holding  Period,  the amount payable to the  Participant  will be
adjusted so that dividends for the six-month  period prior to the termination of
employment are not deemed to be reinvested.

If a Participant  for any Plan Year ceases to be employed by the Company and its
affiliates  during the year for reasons of  retirement  after  attaining age 55,
disability  (as  determined  by the  CEO)  or  death,  the  Participant  (or the
Participant's  beneficiary)  shall be  entitled to the amount of the Total Award
for the year,  pro-rated  based on the number of months between the beginning of
the Plan Year and the date of  retirement,  disability or death.  The payment of
such amount shall be made in the first quarter of the year following the year in
which occurs the termination of employment because of retirement,  disability or
death.

If a Participant  for any Plan Year ceases to be employed by the Company and its
affiliates  during that year for reasons other than  retirement  after attaining
age 55,  disability (as determined by the CEO) or death,  the Participant  shall
forfeit the Total Award for the year.

If a Participant  for any Plan Year ceases to be employed by the Company and its
affiliates  after the end of such Plan Year for any  reason,  the  Participant's
Short-Term Payment shall be unaffected by the termination of employment.

If a Participant  for any Plan Year ceases to be employed by the Company and its
affiliates  after the end of that Plan Year, and prior to the end of the Holding
Period,  for  reasons of  retirement  after  attaining  age 55,  disability  (as
determined  by  the  CEO)  or  death,  the  Participant  (or  the  Participant's
beneficiary)  shall be entitled to the Long-Term  Payment,  determined as though
the  Holding  Period  ended  on the  last  business  day  of  the  Participant's
employment.  The  payment of such  amount  shall be made as soon as  practicable
after termination of employment.

If a Participant  for any Plan Year ceases to be employed by the Company and its
affiliates  after the end of such Plan Year, and prior to the end of the Holding
Period, for reasons other than retirement after attaining age 55, disability (as
determined  by the CEO) or death,  the  Participant  shall forfeit the Long-Term
Payment for the year.

Administration

The Plan shall be administered by the CEO;  provided that, the Employee Services
department shall have  responsibility  for the day-to-day  administration of the
Plan.

Amendment and Termination

The Plan may be amended or  terminated  by the Board of Directors of the Company
at any time,  except that no such amendment or  termination  adopted in any Plan
Year shall adversely  affect the awards of any Participant for that Plan Year or
any prior Plan Year.