Exhibit 10(ff)





POLLUTION CONTROL FACILITIES LOAN AGREEMENT



Dated as of February 1, 2005



Between



LEHIGH COUNTY INDUSTRIAL DEVELOPMENT AUTHORITY



and



PPL ELECTRIC UTILITIES CORPORATION



---

TABLE OF CONTENTS

|                                                               |                                                       | Page                                                  
|-------------------------------------------------------------- | ----------------------------------------------------- | ------------------------------------------------------
|ARTICLE 1.                                                     | Background, Representations
        and Findings      | 1                                                     
|                                                               | SECTION 1.1                                           | Background                                            
|                                                               | SECTION 1.2                                           | Company Representations.                              
|                                                               | SECTION 1.3                                           | Issuer Findings and Representations                   
|ARTICLE 2.                                                     | Refunding the Prior Bonds                             | 4                                                     
|                                                               | SECTION 2.1                                           | Issuance of Bonds                                     
|                                                               | SECTION 2.2                                           | Investment of Fund Moneys                             
|ARTICLE 3.                                                     | Loan and Repayment                                    | 4                                                     
|                                                               | SECTION 3.1                                           | Amount and Source of Loan.                            
|                                                               | SECTION 3.2                                           | Repayment of Loan                                     
|                                                               | SECTION 3.3                                           | The Note                                              
|                                                               | SECTION 3.4                                           | Acceleration of Payment to Redeem
        Bonds       
|                                                               | SECTION 3.5                                           | No Defense or Set-Off.                                
|                                                               | SECTION 3.6                                           | Assignment of Issuer's Rights.                        
|ARTICLE 4.                                                     | Covenants of the Company;
        Certain Limitations | 6                                                     
|                                                               | SECTION 4.1                                           | Corporate Existence                                   
|                                                               | SECTION 4.2                                           | Payment of Trustee's Compensation
        and Expenses
|                                                               | SECTION 4.3                                           | Payment of Issuer's Expenses                          
|                                                               | SECTION 4.4                                           | Indemnity Against Claims                              
|                                                               | SECTION 4.5                                           | Limitation of Liability of the
        Issuer         
|                                                               | SECTION 4.6                                           | Nondiscrimination/Sexual Harassment
        Clause    
|                                                               | SECTION 4.7                                           | Default, etc                                          
|                                                               | SECTION 4.8                                           | Deficiencies in Revenues                              
|                                                               | SECTION 4.9                                           | Tax-Exempt Status                                     
|ARTICLE 5.                                                     | Miscellaneous                                         | 9                                                     
|                                                               | SECTION 5.1                                           | Notices                                               
|                                                               | SECTION 5.2                                           | Assignment                                            
|                                                               | SECTION 5.3                                           | Illegal, Etc. Provisions Disregarded                  
|                                                               | SECTION 5.4                                           | Applicable Law                                        
|                                                               | SECTION 5.5                                           | Amendments                                            
|                                                               | SECTION 5.6                                           | Continuing Disclosure.                                
|                                                               | SECTION 5.7                                           | Term of Agreement                                     
|                                                               | SECTION 5.8                                           | Financing Statements, etc                             
|                                                               | SECTION 5.9                                           | Counterparts                                          
|EXHIBIT A - FORM OF COMPANY
        NOTE                       | A-1                                                  
|EXHIBIT B - NONDISCRIMINATION/SEXUAL
        HARASSMENT CLAUSE | B-1                                                  

POLLUTION CONTROL FACILITIES LOAN AGREEMENT, dated as of February 1, 2005 (the
  "Agreement"), between the LEHIGH COUNTY INDUSTRIAL DEVELOPMENT AUTHORITY
  (the "Issuer") and PPL ELECTRIC UTILITIES CORPORATION (the "Company"):

ARTICLE 1.Background, Representations and Findings

SECTION 1.1    Background.

(a)    The Issuer is a public instrumentality of the Commonwealth
  of Pennsylvania (the "Commonwealth") and a body corporate and politic
  organized and existing pursuant to the Economic Development Financing Law (the
  "Act"). Under the Act, the Issuer is authorized, among other things,
  to make loans to any "project applicant" or "project user"
  (each as defined in the Act) in order to pay or provide for the financing or
  refinancing of costs of pollution control facilities. The Company (formerly
  known as Pennsylvania Power & Light Company) has heretofore requested the
  Issuer to undertake the financing of certain air or water pollution control
  facilities or certain sewage or solid waste disposal facilities at the Susquehanna
  Steam Electric Generating Station in Salem Township, Luzerne County in the Commonwealth
  of Pennsylvania (collectively, the "Project Facilities"), and, for
  such purpose, the Issuer has previously issued $115,500,000 aggregate principal
  amount of its Lehigh County Industrial Development Authority Pollution Control
  Revenue Refunding Bonds, 1994 Series B (Pennsylvania Power & Light Company
  Project) (the "Prior Bonds").

(b)    The Company has transferred its interest in the
  Project Facilities to PPL Susquehanna, LLC, a Delaware limited liability company
  and an affiliate of the Company ("PPL Susquehanna").

(c)    The Company has requested that the Issuer refund
  the Prior Bonds. In order to pay a portion of the costs of refunding the Prior
  Bonds, the Issuer has agreed to issue $115,500,000 aggregate principal amount
  of its Pollution Control Revenue Refunding Bonds, 2005 Series A (PPL Electric
  Utilities Corporation Project) (the "Bonds") on the terms and conditions
  set forth in the subsequent sections of this Agreement.

SECTION 1.2    Company Representations.

The Company represents that:

(a)    It is a corporation duly organized and existing
  under the laws of the Commonwealth of Pennsylvania, with full power and legal
  right to enter into this Agreement and the Note and perform its obligations
  hereunder and thereunder. The making and performance of this Agreement and the
  Note on the part of the Company have been duly authorized by all necessary action.
  This Agreement and the Note have been duly executed and delivered by the Company
  and constitute the valid and binding obligations of the Company enforceable
  in accordance with their respective terms except as the enforcement thereof
  may be limited by bankruptcy, insolvency, fraudulent transfer, reorganization,
  moratorium and other similar laws relating to or affecting the enforcement of
  creditors' rights generally, to general equitable principles (whether considered
  in a proceeding in equity or at law) and to an implied covenant of good faith
  and fair dealing.

(b)    The Project Facilities constitute pollution control
  facilities as defined in the Act and are consistent with the purposes of the
  Act.

(c)    None of the proceeds of the Bonds will be used directly
  or indirectly to acquire land or any interest therein or for the acquisition
  of any property or interest therein unless the first use of such property was
  pursuant to such acquisition.

(d)    All of the proceeds of the Prior Bonds were used
  to refund $115,500,000 aggregate principal amount of the Lehigh Industrial Development
  Authority's Pollution Control Revenue Bonds, 1984 Series B (Pennsylvania Power
  & Light Company Project) (the "Project Bonds") and at least 90%
  of the proceeds of the Project Bonds were issued to provide "pollution
  control facilities" and "solid waste disposal facilities" within
  the meaning of Sections 103(b)(4)(E) and (F) of the Internal Revenue Code of
  1954, as amended, and in effect prior to the passage of the Tax Reform Act of
  1986 (the "1954 Code").

(e)    None of the proceeds of the Bonds will be used to
  provide working capital.

(f)    None of the proceeds of the Project and Prior Bonds
  were used, and none of the proceeds of the Bonds will be used, to provide any
  airplane, skybox or other private luxury box, or health club facility; any facility
  primarily used for gambling; or any store the principal business of which is
  the sale of alcoholic beverages for consumption off premises.

(g)    The Prior Bonds were issued on September 15, 1994.

(h)    Acquisition, construction and installation of the
  Project Facilities has been accomplished.

(i)    The Company and PPL Susquehanna have used or operated
  the Project Facilities in a manner consistent with the purposes of the Project
  Facilities and the Act and the Company knows of no reason why the Project Facilities
  will not be so operated.

(j)    Neither the Prior Bonds nor the Bonds are or will
  be "federally guaranteed," as defined in Section 149(b) of the Internal
  Revenue Code of 1986, as amended (the "Code"); references to the Code
  and Sections of the Code (or, as applicable, to the 1954 Code and Sections thereof)
  include Sections 1312 and 1313 of the Tax Reform Act of 1986, relevant applicable
  regulations and proposed regulations thereunder and under the 1954 Code and
  any successor provisions to those Sections, regulations or proposed regulations
  and, in addition, all applicable official rulings and judicial determinations
  under the foregoing applicable to the Prior Bonds or the Bonds, as applicable.

(k)    At no time will any funds constituting gross proceeds
  of the Bonds be used in a manner as would constitute failure of compliance with
  Section 148 of the Code.

(l)    None of the proceeds (within the meaning of Section
  147(g) of the Code) of the Bonds will be used to pay for any costs of issuance
  of the Bonds.

(m)    The proceeds derived from the sale of the Bonds
  (other than any accrued interest thereon) will be used exclusively to refund
  the outstanding principal amount of the Prior Bonds. The principal amount of
  the Bonds does not exceed the outstanding principal amount of the Prior Bonds.
  The redemption of the outstanding principal amount of the Prior Bonds with such
  proceeds of the Bonds will occur not later than 90 days after the date of issuance
  of the Bonds. All earnings derived from the investment of such proceeds of the
  Bonds will be fully needed and used on such redemption date to pay a portion
  of the redemption premium and interest accrued and payable on the Prior Bonds
  on such date.

(n)    On the date of issuance and delivery of the Prior
  Bonds, the Company reasonably expected that all of the proceeds of such Prior
  Bonds would be used to carry out the governmental purposes of such issue within
  the three-year period beginning on the date such issue was issued and none of
  the proceeds of such issue, if any, were invested in nonpurpose investments
  having a substantially guaranteed yield for three years or more.

(o)    Neither the average maturity of the Prior Bonds
  nor the average maturity of the Bonds exceeds 120% of the average reasonably
  expected economic lives of the facilities financed or refinanced by the proceeds
  of the Bonds (determined under Section 147(b) of the Code).

(p)    It is not anticipated, as of the date hereof, that
  there will be created any "replacement proceeds," within the meaning
  of Section 1.148-1(c) of the Treasury Regulations, with respect to the Bonds;
  however, in the event that any such replacement proceeds are deemed to have
  been created, such amounts will be invested in compliance with Section 148 of
  the Code.

(q)    The information furnished by the Company and used
  by the Issuer in preparing the certification pursuant to Section 148 and in
  preparing the Form 8038 information statement pursuant to Section 149(e) of
  the Code was accurate and complete as of the date of issuance of the Prior Bonds,
  and the information furnished by the Company and used by the Issuer in preparing
  the certification pursuant to Section 148 of the Code and in preparing the Form
  8038 information statement pursuant to Section 149(e) of the Code will be accurate
  and complete as of the date of issuance of the Bonds.

(r)    The Company does not own or operate any of the Project
  Facilities. PPL Susquehanna has agreed with the Company that, for so long as
  it owns any of the Project Facilities, it will operate such Project Facilities
  in a manner consistent with the Company's tax covenants in this Agreement and
  the other transaction documents relating to the issuance of the Bonds. Notwithstanding
  the foregoing, nothing in any such agreement with PPL Susquehanna requires,
  and nothing in this Agreement shall require, the Company or PPL Susquehanna
  to operate any portion of the Project Facilities, or prevents PPL Susquehanna
  from selling all or any portion of the Project Facilities, or from merging or
  consolidating with another entity. Nothing in this Agreement shall bind PPL
  Susquehanna or any other affiliate of the Company that owns the Project Facilities
  or any portion thereof, or any purchasers of any portions of the Project Facilities
  or portions thereof sold.

SECTION 1.3    Issuer Findings and Representations.

The Issuer hereby confirms its findings and represents that:

(a)    The Project Facilities qualify as "pollution
  control facilities" for purposes of the Act and promote the public purposes
  of the Act by maintaining employment and alleviating unemployment in the Commonwealth.

(b)    The Project Facilities promote the health, safety
  and general welfare of the people of the Commonwealth by reducing air, water
  and other pollution and contamination and permitting additional generation of
  electric energy.

(c)    The Issuer has the necessary power under the Act,
  and has duly taken all action on its part required, to execute and deliver this
  Agreement and to undertake the refunding of the Prior Bonds through the issuance
  of the Bonds. The execution and performance of this Agreement by the Issuer
  will not violate or conflict with any instrument by which the Issuer or its
  properties are bound.

ARTICLE 2.Refunding the Prior Bonds

SECTION 2.1    Issuance of Bonds.

In order to assist the Company in the refunding of the Prior Bonds, the Issuer,
  concurrently with the execution hereof, will issue, sell and deliver the Bonds.
  The proceeds of the Bonds shall be loaned to the Company in accordance with
  Section 3.1. The Bonds will be issued under and pursuant to the Trust Indenture
  (the "Indenture") dated as of February 1, 2005 between the Issuer
  and JPMorgan Chase Bank, N.A., as trustee (the "Trustee"), and will
  be issued in the aggregate principal amount, will bear interest, will mature
  and will be subject to redemption as set forth therein. The Company hereby approves
  the Indenture and the Bonds and the terms and conditions under which the Bonds
  have been issued, sold and delivered. Each capitalized term not otherwise defined
  herein shall have the meaning given to such term in the Indenture.

The proceeds from the sale of the Bonds shall be loaned to the Company to assist
  the Company in refunding the Prior Bonds. Those proceeds shall be delivered
  to the Escrow Agent to be held, together with any interest earnings thereon,
  in trust, as provided in the Escrow Agreement for the purpose of paying, together
  with moneys provided by the Company, all of the remaining principal, redemption
  premium and interest due on the Prior Bonds to their redemption date.

SECTION 2.2    Investment of Fund Moneys.

Any moneys held as part of the Bond Fund shall be invested or reinvested by
  the Trustee as provided in the Indenture. The Issuer (to the extent it retained
  or retains direction or control) and the Company each hereby represent that
  the investment and reinvestment and the use of the proceeds of the Prior Bonds
  were restricted in such manner and to such extent as was necessary so that the
  Prior Bonds would not constitute arbitrage bonds under Section 148 of the Code
  and each hereby covenants that it will restrict that investment and reinvestment
  and the use of the proceeds of the Bonds in such manner and to such extent,
  if any, as may be necessary so that the Bonds will not constitute arbitrage
  bonds under Section 148 of the Code.

The Company shall provide the Issuer with, and the Issuer may base its certificate
  and statement on, a certificate of an appropriate officer, employee or agent
  of or consultant to the Company for inclusion in the transcript of proceedings
  for the Bonds, setting forth the reasonable expectations of the Company on the
  date of delivery of and payment for the Bonds regarding the amount and use of
  the proceeds of the Bonds and the facts, estimates and circumstances on which
  those expectations are based.

ARTICLE 3.Loan and Repayment

SECTION 3.1    Amount and Source of Loan.

Concurrently with the delivery of the Bonds, the Issuer will, upon the terms
  and conditions of this Agreement, lend the proceeds of the Bonds to the Company,
  by deposit thereof in accordance with the provisions of the Indenture. The Bonds
  may be sold by the Issuer at a discount from their principal amount, and in
  such event, the amount of such discount shall be deemed to have been loaned
  to the Company. To the extent that accrued interest on the Bonds is received
  by the Issuer upon the sale of the Bonds and is deposited into the Bond Fund
  under the Indenture, such accrued interest shall be applied to the first interest
  payment due on the Bonds with a corresponding credit on the amounts otherwise
  due under the Note (as hereinafter defined).

SECTION 3.2    Repayment of Loan.

The Company agrees to repay the loan made by the Issuer under Section 3.1 in
  installments which, as to amount, shall correspond to the payments of principal
  on the Bonds and, if applicable, any redemption price and shall bear interest
  at the interest rate set forth in the Bonds, such principal, redemption price
  and interest to be payable when such principal, redemption price, if applicable,
  or interest is due in accordance with the terms of the Indenture, provided that
  such amount shall be reduced to the extent that other moneys on deposit with
  the Trustee are available for such purpose, and a credit in respect thereof
  has been granted pursuant to the Indenture. All such repayments made by the
  Company pursuant to this Agreement shall be made in funds that will be available
  to the Trustee no later than (a) the corresponding principal or interest payment
  date on the Bonds or (b) if a Bond Insurance Policy is in effect and Section
  14.01 of the Indenture requires the Trustee to notify the Bond Insurer of deficiencies
  prior to payment dates, one Business Day prior to the date the Trustee is required
  to make such payments. To evidence its obligation to pay such amounts, the Company
  will deliver the Note, as described under Section 3.3.

SECTION 3.3    The Note.

Concurrently with the issuance by the Issuer of the Bonds, the Company will
  execute and deliver to the Trustee a debt instrument of the Company, which debt
  instrument shall be in the form of a non-negotiable promissory note substantially
  in the form attached hereto as Exhibit A (the "Note"). The Note shall:

(i)    be payable to the Trustee as assignee of the Issuer's
  rights hereunder;

(ii)    be in a principal amount equal to the aggregate
  principal amount of the Bonds;

(iii)    provide for payments of interest at least equal
  to the payments of interest on the Bonds;

(iv)    require payments of principal equal to the corresponding
  payments on the Bonds;

(v)    contain provisions in respect of the prepayment
  of principal corresponding to the redemption provisions of the Bonds; and

(vi)    require all payments on the Note to be made on
  or prior to the due date for the corresponding payment to be made on the Bonds.

SECTION 3.4    Acceleration of Payment to Redeem Bonds.

The Issuer will redeem any of the Bonds or portions thereof upon the occurrence
  of an event which gives rise to any special mandatory redemption specified in
  the Indenture and in accordance with the provisions thereof. Upon any such special
  mandatory redemption, the Company shall prepay the Note in full (or in part,
  if in the opinion of Bond Counsel such partial redemption will preserve the
  exclusion from gross income for federal income tax purposes of interest on the
  Bonds remaining outstanding after such redemption). Whenever the Bonds are subject
  to optional redemption or extraordinary optional redemption, the Issuer will,
  but only upon direction or request of the Company, redeem the same in accordance
  with such direction or request and the Indenture. In either event, the Company
  will pay an amount equal to the applicable redemption price as a prepayment
  of the Note, together with interest accrued to the date of redemption, as provided
  in the Note.

In the event that the Company receives notice from the Trustee pursuant to
  the Indenture that a proceeding has been instituted against a Bondholder which
  could lead to a final determination that interest on the Bonds is taxable, the
  Company shall promptly notify the Trustee and the Issuer whether or not it intends
  to contest such proceeding. In the event that the Company chooses to so contest,
  it will use its best efforts to obtain a prompt final determination or decision
  in such proceeding or litigation and will keep the Trustee and the Issuer informed
  of the progress of any such proceeding or litigation.

SECTION 3.5    No Defense or Set-Off.

The obligations of the Company to make payments on the Note shall be absolute
  and unconditional without defense or setoff by reason of any default by the
  Issuer under this Agreement or under any other agreement between the Company
  and the Issuer or for any other reason, including without limitation, loss or
  impairment of investments in the Bond Fund, any acts or circumstances that may
  constitute failure of consideration, destruction of or damage to the Project
  Facilities, commercial frustration of purpose, or failure of the Issuer to perform
  and observe any agreement, whether express or implied, or any duty, liability
  or obligation arising out of or connected with this Agreement, it being the
  intention of the parties that the payments required hereunder will be paid in
  full when due without any delay or diminution whatsoever.

SECTION 3.6    Assignment of Issuer's Rights.

As the source of payment for the Bonds, the Issuer will assign to the Trustee
  all the Issuer's rights under this Agreement with respect to the Bonds (except
  rights to receive payments under Sections 4.3 and 4.4) including all of its
  right, title and interest in the Note and the moneys payable thereunder. The
  Company consents to such assignment and agrees to make payments on the Note
  and interest thereon directly to the Trustee without defense or setoff by reason
  of any dispute between the Company and the Issuer or the Trustee.

ARTICLE 4.Covenants of the Company; Certain Limitations

SECTION 4.1    Corporate Existence.

So long as the Bonds are outstanding, the Company agrees to maintain its corporate
  existence and, to the extent required by Pennsylvania law, its qualification
  to do business in Pennsylvania, except that it may dispose of all or substantially
  all of its assets and may consolidate with or merge into another corporation
  or entity or permit one or more corporations or entities to consolidate with
  or merge into it, if the surviving, resulting or transferee corporation or entity,
  if other than the Company, is solvent, and assumes in writing all of the obligations
  of the Company hereunder and under the Note and is a corporation or other entity
  duly organized under the laws of one of the states of the United States of America
  and, to the extent required by Pennsylvania law, is duly qualified to do business
  in the Commonwealth of Pennsylvania provided that the Company shall have delivered
  to the Trustee a certificate from an officer of the Company to the effect that
  such disposition, consolidation, merger and assumption complies with the provisions
  of this Agreement.

SECTION 4.2    Payment of Trustee's Compensation and
  Expenses.

The Company will pay the Trustee's compensation and expenses under the Indenture,
  including out-of-pocket, incidental and reasonable attorney's fees and expenses
  and costs of redeeming Bonds thereunder and the compensation and expenses of
  any authenticating agent, the Bond Registrar and the Paying Agent appointed
  in respect of the Bonds.

SECTION 4.3    Payment of Issuer's Expenses.

The Company will pay the Issuer's administrative fees and expenses, including
  legal and accounting fees, incurred by the Issuer in connection with the issuance
  of the Bonds and the performance by the Issuer of any and all of its functions
  and duties under this Agreement or the Indenture, including, but not limited
  to, all duties which may be required of the Issuer by the Trustee and the Bondholders.
  The Issuer's fee is $231,000.

SECTION 4.4    Indemnity Against Claims.

The Company releases the Issuer from, agrees that the Issuer shall not be liable
  for, and indemnifies the Issuer against, all liabilities, claims (including
  claims for any injury, bodily harm or death of any person), costs and expenses
  imposed upon or asserted against the Issuer on account of: (a) the maintenance,
  operation and use of the Project Facilities; (b) any breach or default on the
  part of the Company in the performance of any covenant or agreement of the Company
  under this Agreement, the Note or the Continuing Disclosure Undertaking (as
  defined in the Indenture) or arising from any act or failure to act by the Company
  under such documents; (c) the refunding of the Prior Bonds, and the provision
  of any information furnished by the Company in connection therewith concerning
  the Project Facilities or the Company (including, without limitation, any information
  furnished by the Company for inclusion in any certifications made by the Issuer
  under Section 2.2 or for inclusion in, or as a basis for preparation of, the
  information statements filed by the Issuer pursuant to the Code); (d) any audit
  of the tax status of the interest on the Bonds; and (e) any claim, action or
  proceeding with respect to the matters set forth in (a), (b) and (c) above brought
  thereon, except to the extent that any liability, claim, cost or loss was due
  to the Issuer's willful misconduct.

The Company agrees to indemnify the Trustee and any predecessor Trustee and
  to hold the Trustee and any predecessor Trustee harmless against, any and all
  loss, claim, damage, fine, penalty, liability or expense incurred by them, including
  out-of-pocket and incidental expenses and reasonable legal fees and expenses
  ("Losses") arising out of or in connection with the acceptance or
  administration of the Indenture or the trusts thereunder or the performance
  of their duties thereunder or under this Agreement, including the costs and
  expenses of defending themselves against or investigating any claim (whether
  asserted by the Issuer, the Company, a Bondholder or any other person) of liability
  in the premises, except to the extent that any such loss, liability or expense
  was due to the Trustee's or such predecessor Trustee's, as the case may be,
  own negligence or bad faith. In addition to and not in limitation of the preceding
  sentence, the Company agrees to indemnify the Trustee and any predecessor Trustee
  and their agents, officers, directors and employees for any Losses that may
  be imposed on, incurred by or asserted against them for following any instructions
  or directions upon which the Trustee or such predecessor Trustee is authorized
  to rely pursuant to the Indenture.

In case any action or proceeding is brought against the Issuer, the Trustee
  or any predecessor Trustee, in respect of which indemnity may be sought hereunder,
  the party seeking indemnity shall promptly give notice of that action or proceeding
  to the Company, and the Company upon receipt of that notice shall have the obligation
  and the right to assume the defense of the action or proceeding. At its own
  expense, an indemnified party may employ separate counsel and participate in
  the defense; provided however, where it is ethically inappropriate for one firm
  to represent the interests of the Issuer and any other indemnified party or
  parties, the Company shall pay the Issuer's, the Trustee's or the predecessor
  Trustee's legal expenses, respectively, in connection with the Issuer's, the
  Trustee's or the predecessor Trustee's retention of separate counsel. The Company
  shall not be liable for any settlement made without its consent.

The indemnification set forth above is intended to and shall include the indemnification
  of all affected officials, directors, officers, agents and employees, past,
  present and future, of the Issuer, the Trustee and any predecessor Trustee;
  and, to the extent relating to the Trustee or any predecessor Trustee, shall
  be for the benefit of the Trustee or such predecessor Trustee in each of its
  respective capacities under the Indenture. That indemnification is intended
  to and shall be enforceable by the Issuer, the Trustee and any predecessor Trustee,
  respectively, to the full extent permitted by law.

SECTION 4.5    Limitation of Liability of the Issuer.

All covenants, stipulations, obligations and agreements of the Issuer contained
  in this Agreement or the Indenture shall be effective to the extent authorized
  and permitted by applicable law. No such covenant, stipulation, obligation or
  agreement shall be deemed to be a covenant, stipulation, obligation or agreement
  of any past, present or future member, officer, agent or employee of the Issuer
  in other than his official capacity, and neither the members, officers, agents
  or employees, past, present or future, of the Issuer nor any official executing
  the Bonds shall be liable personally on the Bonds or be subject to any personal
  liability or accountability by reason of the issuance thereof or by reason of
  the covenants, stipulations, obligations or agreements of the Issuer contained
  in this Agreement or in the Indenture. Furthermore, no obligation of the Issuer
  hereunder or under the Bonds shall be deemed to constitute a pledge of the faith
  and credit of the Issuer, or the faith and credit or taxing power of the Commonwealth
  of Pennsylvania, the County of Lehigh, or of any other political subdivision
  thereof, but shall be payable solely out of revenues pledged therefor.

SECTION 4.6    Nondiscrimination/Sexual Harassment Clause.

The Company shall use all reasonable efforts consistent with its existing procedures
  to comply with the provisions of the Nondiscrimination/Sexual Harassment Clause
  set forth in Exhibit B hereto. For purposes of such Nondiscrimination/Sexual
  Harassment Clause, the parties hereto understand that (i) this Agreement is
  the "contract" and (ii) there is no subcontractor for the performance
  of the Company's obligations under this Agreement.

SECTION 4.7    Default, etc.

(a)    In addition to all other rights of the Issuer granted
  herein, in the Note, or otherwise by law, the Issuer shall have the right to
  specifically enforce the performance and observation by the Company of any of
  its obligations, agreements or covenants under this Agreement or under the Note
  and may take any actions at law or in equity to collect any payments due or
  to obtain other remedies. If the Company shall default under any provisions
  of this Agreement or in any payment under this Agreement or the Note, and the
  Issuer shall employ attorneys or incur other expenses for the collection of
  payments due or for the enforcement of the performance or observation of any
  obligation or agreement on the part of the Company contained herein or therein,
  the Company will on demand therefor reimburse the reasonable fees of such attorneys
  and such reasonable expenses so incurred.

(b)    The Company and the Issuer acknowledge that the
  rights of the Issuer under this Agreement (except the Issuer's rights under
  Sections 4.3, 4.4, and 4.5 hereof), including the rights of the Issuer to the
  enforcement of this Agreement and the exercise of remedies upon the occurrence
  of any Event of Default, have been assigned by the Issuer to the Trustee in
  accordance with the Indenture. The rights of the Trustee are further subject
  to any rights of the Bond Insurer as provided in the Indenture.

SECTION 4.8    Deficiencies in Revenues.

If for any reason, including the Company's being required to withhold or pay
  any tax imposed by reason of its obligations evidenced by the Note, amounts
  paid to the Trustee on the Note, together with other moneys held by the Trustee
  then available, would not be sufficient to make the corresponding payments of
  the principal of, premium, if any, and interest on, the Bonds when such payments
  become due, the Company will pay or cause to be paid the amounts required from
  time to time, when due, to make up any such deficiency.

SECTION 4.9    Tax-Exempt Status.

(a)    The Company covenants and represents that it has
  taken and caused to be taken and shall take and cause to be taken all actions
  that may be required of it for the interest on the Bonds to be and to remain
  excluded from gross income for federal income tax purposes, and that it has
  not taken or permitted to be taken on its behalf, and covenants that it will
  not take, or permit to be taken on its behalf, any action which, if taken, would
  adversely affect that exclusion under the provisions of the Code.

(b)    To the extent an exemption is not available from
  the requirements of Section 148(f) of the Code, the Company will retain a qualified
  consultant to calculate, and shall pay to or for the account of the Issuer,
  all amounts needed to comply with the requirements of Section 148 of the Code,
  with respect to the Bonds, including Section 148(f) which requires generally
  a rebate payment to the United States of arbitrage profit from investment of
  the proceeds of the Bonds in obligations other than tax-exempt obligations.
  The obligation of the Company to make such payments is unconditional and is
  not limited to funds representing the proceeds of the Bonds or income from the
  investment thereof or any other particular source.

ARTICLE 5.Miscellaneous

SECTION 5.1    Notices.

Notice hereunder shall be given in writing, either by registered mail, to be
  deemed effective two days after mailing, by telegram, by telecopy or other similar
  facsimile transmission, or by telephone, confirmed in writing, addressed as
  follows:

|The Issuer: | Lehigh County Industrial Development Authority
        2158 Avenue C, Suite 200
        Bethlehem, PA 18107
        Attention: Janet R. Smith
        Phone: (610) 266-0887
        Fax: (610) 266-7623   
|----------- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|The Company | PPL Electric Utilities Corporation
        Two North Ninth Street
        Allentown, Pennsylvania 18101
        Attention: Treasury Department
        Phone: 610-774-2636 
        Fax: 610-774-5235     
|The Trustee | JPMorgan Chase Bank, N.A.
        4 New York Plaza - 15th Floor
        New York, New York 10004
        Attention: Institutional Trust Services
        Phone: (212) 623-6768
        Fax: (212) 623-6167

or to such other address as may be filed in writing with the parties to this
  Agreement and with the Trustee.

SECTION 5.2    Assignment.

This Agreement may not be assigned by either party without the prior written
  consent of the other party hereto, which consent shall not be unreasonably withheld,
  except that the Issuer may assign rights with respect to the Bonds to the Trustee
  pursuant to Section 3.6 hereof, and the Company may assign its rights and obligations
  under this Agreement at any time in connection with a disposition of all or
  substantially all of its assets permitted under Section 4.1. Notwithstanding
  the foregoing, no merger or consolidation permitted under Section 4.1 shall
  be deemed to be an assignment for purposes of this Section 5.2.

SECTION 5.3    Illegal, etc. Provisions Disregarded.

In case any provision of this Agreement shall for any reason be held invalid,
  illegal or unenforceable in any respect, this Agreement shall be construed as
  if such provision had never been contained herein.

SECTION 5.4    Applicable Law.

This Agreement has been delivered in the Commonwealth of Pennsylvania and shall
  be deemed to be governed by, and interpreted under, the laws of that Commonwealth.

SECTION 5.5    Amendments.

This Agreement may not be amended except by an instrument in writing signed
  by the parties hereto and, if such amendment occurs after the issuance of the
  Bonds, in accordance with the terms of the Indenture.

SECTION 5.6    Continuing Disclosure.

The Issuer hereby acknowledges the entry by the Company into the Continuing
  Disclosure Undertaking under which the Company has assumed certain obligations
  for the benefit of the holders and beneficial owners of the Bonds. The Company
  agrees to perform its obligations under the Continuing Disclosure Undertaking.
  Notwithstanding any other provision of this Agreement, any failure by the Company
  to comply with any provision of the Continuing Disclosure Undertaking shall
  not be a failure or a default, or an Event of Default, under this Agreement
  or the Indenture.

SECTION 5.7    Term of Agreement.

This Agreement shall become effective upon its delivery and shall continue
  in effect until all Bonds have been paid or provision for such payment has been
  made in accordance with the Indenture, except that the provisions hereof contained
  in Sections 4.2, 4.3, 4.4, 4.5, 4.9 and this Section 5.7 shall continue in effect
  thereafter.

SECTION 5.8    Financing Statements, etc.

The Company agrees to file or record or to re-file or re-record all financing
  statements and continuation statements and all other documents, notices and
  instruments required under applicable law to perfect or maintain the perfection
  of or to otherwise preserve the validity of the liens and security interests
  granted to the Trustee under the Indenture.

SECTION 5.9    Counterparts.

This Agreement may be executed in several counterparts, all or any of which
  shall be regarded for all purposes as one original and shall constitute and
  be but one and the same instrument.

---

IN WITNESS WHEREOF, the parties hereto, in consideration of the mutual covenants
  set forth herein and intending to be legally bound, have caused this Agreement
  to be executed and delivered as of the date first written above.

|(SEAL)
      Attest:
      By:  _____________________________________
                  Joanne D.
        Kuchera, Assistant Secretary | LEHIGH COUNTY INDUSTRIAL 
        DEVELOPMENT AUTHORITY
      By:  _____________________________________
                W. Cordes Snyder, III,
        Chairman
|-------------------------------------------------------------------------------------------------------------------------------------- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------
|                                                                                                                                       | PPL ELECTRIC UTILITIES CORPORATION
      By:  _____________________________________

            James E. Abel, Treasurer                                       

---

EXHIBIT A - FORM OF COMPANY NOTE

POLLUTION CONTROL FACILITIES NOTE
  (LEHIGH COUNTY INDUSTRIAL DEVELOPMENT AUTHORITY)
  2005 SERIES A

PPL ELECTRIC UTILITIES CORPORATION (the "Company"), a Pennsylvania
  corporation, for value received, promises to pay to JPMorgan Chase Bank, N.A.
  (the "Trustee"), as Trustee under the Trust Indenture dated as of
  February 1, 2005 (the "Indenture") of the Lehigh County Industrial
  Development Authority (the "Issuer"), the principal sum of $115,500,000
  on September 1, 2029 and to pay (i) interest thereon from the date hereof until
  the payment of said principal sum has been made or provided for at the rate
  equal to the interest rate borne by the Issuer's Pollution Control Revenue Refunding
  Bonds, 2005 Series A (PPL Electric Utilities Corporation Project) (the "Bonds")
  and payable on each date that interest is payable on the Bonds, and (ii) interest
  on overdue principal, and to the extent permitted by law, on overdue interest,
  at the rate borne by the Bonds.

This Note is issued pursuant to a certain Pollution Control Facilities Loan
  Agreement (the "Agreement") dated as of February 1, 2005 between the
  Issuer and the Company relating to the refunding of certain obligations of the
  Issuer previously issued to provide funds for the refunding of bonds issued
  to assist the Company (formerly known as Pennsylvania Power & Light Company)
  in the financing of a portion of the cost of acquiring, constructing and installing
  certain pollution control facilities and sewage or solid waste disposal facilities
  at the Susquehanna Steam Electric Generating Station in Salem Township, Luzerne
  County in the Commonwealth of Pennsylvania (the "Project Facilities").
  The obligation of the Company to make the payments required hereunder shall
  be absolute and unconditional without defense or set-off by reason of any default
  by the Issuer under the Agreement or under any other agreement between the Company
  and the Issuer or for any other reason, including without limitation, loss or
  impairment of investments in the Bond Fund, any acts or circumstances that may
  constitute failure of consideration, destruction of or damage to the Project
  Facilities, commercial frustration of purpose, or failure of the Issuer to perform
  and observe any agreement, whether express or implied, or any duty, liability
  or obligation arising out of or connected with the Agreement, it being the intention
  of the Company and the Issuer that the payments hereunder will be paid in full
  when due without any delay or diminution whatsoever.

This Note is subject to prepayment, at the option of the Company, upon written
  notice to the Trustee given not less than 15 days prior to the day on which
  the Bond Registrar is required to give notice of optional redemption or extraordinary
  optional redemption to the Bondholders pursuant to Section 7.04 of Indenture,
  to the extent that the Bonds are subject to optional redemption or extraordinary
  optional redemption pursuant to Section 7.01(a) or (b) of the Indenture at a
  prepayment price equal to the corresponding redemption price of the Bonds. Notice
  of any optional prepayment of this Note shall be conditional if the corresponding
  notice of optional redemption or extraordinary optional redemption of the Bonds
  under Section 7.04 of the Indenture is conditional and if the optional redemption
  or extraordinary optional redemption of the Bonds does not occur as a result
  of a failure of such condition, the notice of optional prepayment of this Note
  shall be of no effect.

If the Bonds are being called for special mandatory redemption as provided
  in Section 7.01(c) of the Indenture, the Company shall, on or before the proposed
  redemption date for the Bonds, pay to the Trustee the whole or portion of the
  unpaid principal amount of this Note equal to the principal amount of the Bonds
  being called for special mandatory redemption.

In the event that the Company receives notice from the Trustee pursuant to
  Section 7.01(c) of the Indenture that a proceeding has been instituted as described
  therein which could lead to a final determination that interest on the Bonds
  is taxable, the Company shall promptly notify the Trustee and the Issuer whether
  or not it intends to contest such proceeding. In the event that the Company
  chooses to so contest, it will use its best efforts to obtain a prompt final
  determination or decision in such proceeding or litigation and will keep the
  Trustee and the Issuer informed of the progress of any such proceeding or litigation.

Upon receipt by the Trustee of notice of prepayment hereof in connection with
  the optional or extraordinary optional redemption of the Bonds, the Trustee
  shall take all action necessary under and in accordance with the Indenture to
  redeem Bonds in an amount corresponding to that specified in the particular
  notice.

The Company is entitled to a credit against its obligations under this Note
  and this Note shall not be subject to required payment or prepayment to the
  extent that amounts which would otherwise be payable by the Company hereunder
  are paid from funds held by the Trustee under the Indenture and available for
  such payment.

Whenever payment or provision therefor has been made in respect of the principal
  or redemption price of all or any portion of the Bonds and interest on all or
  any portion of the Bonds, together with all other sums payable by the Issuer
  under the Indenture, in accordance with Article 13 of the Indenture, this Note
  shall be deemed paid to the extent such payment or provision therefor has been
  made, and if thereby deemed paid in full, this Note shall be canceled and returned
  to the Company. Notwithstanding the foregoing, if, for any reason, the amounts
  specified above are not sufficient to make corresponding payments of principal
  or redemption price of the Bonds and interest on the Bonds, when such payments
  are due, the Company shall pay as additional amounts due hereunder, the amounts
  required from time to time to make up any such deficiency.

All payments of principal and interest shall be made to the Trustee at its
  corporate trust office in New York, New York or as otherwise directed by the
  Trustee in such coin or currency of the United States of America as at the time
  of payment shall be legal tender for the payment of public and private debts.
  All payments shall be in the full amount required hereunder unless the Trustee
  notifies the Company that it is entitled to a credit under the Agreement, this
  Note or the Indenture.

The occurrence and continuance of each of the following events is hereby defined
  as and shall constitute an "Event of Default":

(a)    Failure by the Company to pay the principal or prepayment
  price of this Note at maturity or upon unconditional proceedings for prepayment
  within one Business Day of when such principal or prepayment price becomes due
  and payable; or

(b)    Failure by the Company to pay interest on this Note
  in amounts and at the times necessary to enable the Trustee to pay interest
  on the Bonds within ten Business Days of when such interest becomes due and
  payable; or

(c)    The entry by a court having jurisdiction in the
  premises of (1) a decree of order for relief in respect of the Company in an
  involuntary case or proceeding under any applicable Federal or State bankruptcy,
  insolvency or other similar law or (2) a decree or order adjudging the Company
  bankrupt or insolvent, or approving as properly filed a petition of one or more
  Persons other than the Company seeking reorganization, arrangement, adjustment
  or composition of or in respect of the Company under any applicable Federal
  or State bankruptcy, insolvency or other similar law, or appointing a custodian,
  receiver, liquidator, assignee, trustee, sequestrator or other similar official
  for the Company or for any substantial part of its property, or ordering the
  winding up or liquidation of its affairs, and any such decree or order for relief
  or any other decree or order shall have remained unstayed and in effect for
  a period of 90 consecutive days; or

(d)    The commencement by the Company of a voluntary case
  or proceeding under any applicable Federal or State bankruptcy, insolvency or
  other similar law or of any other case or proceeding to be adjudicated a bankrupt
  or insolvent, or the consent by the Company to the entry of a decree or order
  for relief in respect of the Company in a case or proceeding under any applicable
  Federal or State bankruptcy, insolvency or other similar law or to the commencement
  of any bankruptcy or insolvency case or proceeding against the Company, or the
  filing by the Company of a petition or answer or consent seeking reorganization
  or relief under any applicable Federal or State bankruptcy, insolvency or similar
  law, or the consent by the Company to the filing of such petition or to the
  appointment of or taking possession by a custodian, receiver, liquidator, assignee,
  trustee, sequestrator or other similar official of the Company or any substantial
  part of its property, or the making by the Company of an assignment for the
  benefit of creditors, or the admission by the Company in writing of its inability
  to pay its debts generally as they become due, or the authorization of such
  action by the Board of Directors of the Company.

In each and every such case and during the continuance thereof, the Trustee,
  by notice in writing to the Company may declare the unpaid balance of this Note
  to be due and payable immediately if, concurrently with or prior to such notice,
  the unpaid principal amount of the Bonds has been declared due and payable,
  and upon any such declaration the same shall become and shall be immediately
  due and payable, anything in this Note to the contrary notwithstanding. Notwithstanding
  the foregoing, if after any declaration of acceleration hereunder there is an
  annulment of any declaration of acceleration with respect to the Bonds, such
  annulment shall also automatically constitute an annulment of any corresponding
  declaration under this Note and a waiver and rescission of the consequences
  of such declaration.

In case the Trustee shall have proceeded to enforce any right under this Note
  and such proceedings shall have been discontinued or abandoned for any reason
  or shall have been determined adversely to the Trustee, then and in every such
  case the Company and the Trustee shall be restored to their respective positions
  and rights hereunder, and all rights, remedies and powers of the Company and
  the Trustee shall continue as though no such proceeding had been taken, but
  subject to the limitations of any such adverse determination.

The Company covenants that, in case default shall be made in the payment of
  any installment of principal, prepayment price or interest in respect of this
  Note, whether at maturity or by declaration or otherwise, then, upon demand
  of the Issuer or the Trustee, the Company will pay to the Trustee the whole
  amount that then shall have become due and payable on this Note for principal,
  prepayment price and interest with interest on the overdue principal and prepayment
  price and (to the extent enforceable under applicable law) on the overdue installments
  of interest at the rate borne by this Note; and, in addition thereto, such further
  amount as shall be sufficient to cover the reasonable costs and expenses of
  collection, including a reasonable compensation to the Trustee, its agents,
  attorneys and counsel, and any expenses or liabilities incurred by the Trustee
  other than through its negligence or bad faith.

In case the Company shall fail forthwith to pay such amounts upon such demand,
  the Trustee shall be entitled and empowered to take any actions permitted under
  applicable law and to institute any actions or proceedings at law or in equity
  for the collection of the sums so due and unpaid, and may prosecute any such
  action or proceedings to judgment or final decree, and may enforce any such
  judgment or final decree against the Company and collect in the manner provided
  by law out of the property of the Company any moneys adjudged or decreed to
  be payable.

In case there shall be pending proceedings for the bankruptcy or for the reorganization
  of the Company under the Bankruptcy Code or any other applicable law, or in
  case a receiver or trustee shall have been appointed for the property of the
  Company or in the case of any other similar judicial proceeding relative to
  the Company, or to the creditors or property of the Company, the Trustee shall
  be entitled and empowered, by intervention in such proceedings or otherwise,
  to file and prove a claim or claims for the whole amount of this Note and interest
  owing and unpaid in respect thereof and, in case of any judicial proceedings,
  to file such proofs of claims and other papers or documents as may be necessary
  or advisable in order to have the claims of the Trustee allowed in such judicial
  proceedings relative to the Company, its creditors, or its property, and to
  collect and receive any moneys or other property payable or deliverable on any
  such claims, and to distribute the same after the deduction of its fees, charges
  and expenses; and any receiver, assignee or trustee in bankruptcy or reorganization
  is hereby authorized to make such payments to the Trustee, and to pay to the
  Trustee any amount due it for compensation and expenses, including reasonable
  counsel fees incurred by it up to the date of such distribution.

No provision of this Note or of the Agreement or the Indenture shall be deemed
  to authorize the Trustee to authorize or consent to or accept or adopt on behalf
  of any Bondholder any plan of reorganization, arrangement, adjustment or composition
  affecting this Note or the rights of any Bondholder in respect thereof or to
  authorize the Trustee to vote in respect of the claim of any Bondholder in any
  such proceeding; provided, however, that the Trustee may, on behalf of the Bondholders,
  vote for the election of a trustee in bankruptcy or similar official and be
  a member of a creditors' or other similar committee.

No remedy herein conferred is intended to be exclusive of any other remedy
  or remedies.

No recourse shall be had for the payment of the principal or prepayment price
  of or interest on this Note, or for any claim based hereon or on the Agreement,
  against any officer, director or stockholder, past, present or future, of the
  Company as such, either directly or through the Company, under any constitutional
  provision, statute or rule of law, or by the enforcement of any assessment or
  by any legal or equitable proceeding or otherwise.

This Note shall at all times be and remain part of the trust estate under the
  Indenture, and no assignment or transfer by the Trustee of its rights hereunder
  shall be effective, other than (i) a transfer made after an Event of Default
  under the Indenture in the course of the Trustee's exercise of its rights and
  remedies consequent upon such Event of Default, (ii) a transfer required in
  the performance of the Trustee's duties under the Indenture, or (iii) a transfer
  to a successor trustee under the Indenture.

This Note has been delivered in the Commonwealth of Pennsylvania and shall
  be deemed to be governed by, and interpreted under, the laws of that Commonwealth.

Capitalized terms used in this Note not defined herein shall have the meanings
  ascribed to them in the Indenture.

---

IN WITNESS WHEREOF, the Company has caused this Note to be duly executed and
  delivered.



|Date: | PPL ELECTRIC UTILITIES CORPORATION
      By:  _____________________________________
                 James E. Abel, Treasurer
|----- | -----------------------------------------------------------------------------------------------------------------------------

---

EXHIBIT B - NONDISCRIMINATION/SEXUAL HARASSMENT CLAUSE

During the term of this contract, the Company agrees as to itself and each
  tenant of the Project controlling, controlled by or under common control with
  the Company (each of the Company and each such tenant, a "Contractor")
  as follows:

1.    In the hiring of any employee(s) for the manufacture
  of supplies, performance of work, or any other activity required under the contract
  or any subcontract, the Contractor, subcontractor, or any person acting on behalf
  of the Contractor or subcontractor shall not, by reason of gender, race, creed,
  or color, discriminate against any citizen of this Commonwealth who is qualified
  and available to perform the work to which the employment relates.

2.    Neither the Contractor nor any subcontractor nor
  any person on their behalf shall in any manner discriminate against or intimidate
  any employee involved in the manufacture of supplies, the performance of work,
  or any other activity required under the contract on account of gender, race,
  creed or color.

3.    Contractors and subcontractors shall establish and
  maintain a written sexual harassment policy and shall inform their employees
  of the policy. The policy must contain a notice that sexual harassment will
  not be tolerated and employees who practice it will be disciplined.

4.    Contractors shall not discriminate by reason of gender,
  race, creed, or color against any subcontractor or supplier who is qualified
  to perform the work to which the contracts relates.

5.    The Contractor and each subcontractor shall furnish
  all necessary employment documents and records to and permit access to their
  books, records, and accounts by the contracting agency and the Bureau of Contract
  Administration and Business Development, for purposes of investigation, to ascertain
  compliance with provisions of this Nondiscrimination/Sexual Harassment Clause.
  If the Contractor or any subcontractor does not possess documents or records
  reflecting the necessary information requested, the Contractor or subcontractor
  shall furnish such information on reporting forms supplied by the contracting
  agency or the Bureau of Contract Administration and Business Development.

6.    The Contractor shall include the provisions of this
  Nondiscrimination/Sexual Harassment Clause in every subcontract so that such
  provisions will be binding upon each subcontractor.

7.    The Commonwealth may cancel or terminate the contract,
  and all money due or to become due under the contract may be forfeited for a
  violation of the terms and conditions of this Nondiscrimination/Sexual Harassment
  Clause. In addition, the agency may proceed with debarment or suspension and
  may place the Contractor in the Contractor Responsibility File.