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                                                        Exhibit 10.25.1



              NRG GENERATING (NEWARK) COGENERATION INC./
                        POWER OPERATIONS, INC.
                  OPERATING AND MAINTENANCE AGREEMENT

This  System Operating and Maintenance Agreement ("Agreement") is  made
as  of  the  8th  day of November 1996 between NRG Generating  (NEWARK)
Cogeneration  Inc.,  a  Delaware  corporation  ("Owner"),   and   Power
Operations,  Inc.,  a  Delaware corporation  ("Operator"),  having  its
principal   place   of  business  at  Minneapolis,   Minnesota,   whose
obligations  hereunder  shall  be fully guaranteed  by  NRG  Generating
(U.S.) Inc. ("NRGG"), pursuant to a Guarantee required by Credit Suisse
per Credit Agreement dated May 17, 1996 in the form of Appendix I.

Owner  and Stewart & Stevenson Operations, Inc. (SSOI) Operator entered
into  an Operation & Maintenance Contract dated as of May 1, 1996  with
respect  to the System (as defined below), a copy of which is  attached
as Appendix II (the "Existing O&M Agreement").

In  connection  with  the bankruptcy of Owner's  parent,  the  existing
Electricity Purchase Agreement between Owner and Jersey Central Power &
Light  Company  relating to the System has been amended with  an  Third
Amendment to the Power Purchase Agreement (as defined below).

Owner  desires  to replace SSOI and Owner and Operator have  negotiated
the  terms  and conditions of a new O&M Agreement and desire  to  enter
into this Agreement effective upon the Effective Date.

In consideration of the foregoing and the mutual covenants and benefits
contained herein, the parties hereby agree as follows:

I.   DEFINITIONS

In this Agreement the following terms have the associated meaning:

1.   Affiliate - With reference to a specified person, any other person
     or   entity,   directly  or  indirectly  through   one   or   more
     intermediaries,  which controls, is controlled  by,  or  is  under
     common  control  with,  such  person.   A  person  or  entity   is
     controlled  by  another person or entity if the second  person  or
     entity holds a sufficient number of securities in the first person
     or entity to elect a majority of the directors of the first person
     or entity.

2.   Agent - The agent for the lenders under the Financing Agreements.

3.   Amended  Power  Purchase  Agreement -  The  Amended  and  Restated
     Agreement  for Purchase and Sale of Electric Power,  dated   April
     30,  1996, between Owner and Jersey Central Power & Light, a  copy
     of which is attached as Appendix III hereto.

4.   Annual  Operating Plan and Budget - As set forth  in  Article  VI,
     Section 6.

5.   Bonus - As set forth in Exhibit A.

6.   Change - Shall mean any of the following that are proposed by  one
     party to the other by a written notice to the other party:  (i)  a
     change in the then current Annual Operating Plan and Budget;  (ii)
     a  change  in  connection  with the services  to  be  provided  by
     Operator hereunder; (iii) a change made necessary to avoid  injury
     to  persons or property or to mitigate losses as a result  of  the
     occurrence of an Emergency; and (iv) a change enabling Operator to
     accomplish or contract for a Major System Repair.

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7.    Change  Order  - Shall mean the written approval  of  a  proposed
  Change and the related Change Order Budget Statement by Operator  and
  Owner as further provided for in Article VI Section 7 (b).

8.   Change  Order Budget Statement - Shall mean the statement prepared
     by  Operator pursuant to Article VI, Section 7 (b) with respect to
     a  proposed  Change setting forth in reasonable detail:   (i)  the
     direct  cost or savings to Owner of the proposed Change; (ii)  the
     indirect  costs  or  savings  of the  proposed  Change,  including
     without limitation, any loss of electricity revenues or steam host
     revenues  and  any increased insurance, operating, maintenance  or
     other costs during or following the implementation of the proposed
     Change;  (iii) changes in the operating efficiency of the  System;
     and  (iv) any other material effect on the operation, maintenance,
     efficiency or profitability of the System or the provision of  the
     services hereunder.

9.   Contract  Year  - As set forth in the Amended and  Restated  Power
     Purchase Agreement.

10   Effective Date - November 8, 1996.

11.  Emergency  -  Any  event  or occurrence which in the  judgment  of
     Operator  or Owner, as the case may be, requires immediate  action
     and which constitutes a serious hazard to the safety of persons or
     property  or  may materially interfere with the safe,  economical,
     lawful or environmentally sound operation of the System.

12.  Event of Default - As set forth in Article XII.

13.  Existing O&M Agreement - as set forth in the Recitals.

14.  Expenses - As set forth in Article VI, Section 2.

15.  Financing  Agreements  -  Any loan, lease financing,  security  or
     related agreements entered into at any time by and among Owner and
     the lending institutions providing financing for the System.

16.  Force  Majeure  -   Unforeseeable  causes  beyond  the  reasonable
     control  of  and  without  the fault or negligence  of  the  party
     claiming Force Majeure, including but not limited to acts of  God,
     strike, flood, earthquake, storm, fire, lightning, epidemic,  war,
     riot,  civil  disturbance, sabotage, change in law  or  applicable
     regulation  subsequent to the date thereof and action or  inaction
     by   any   federal,   state   or  local  legislative,   executive,
     administrative or judicial agency or body which,  in  any  of  the
     foregoing cases, by exercise of due foresight such party could not
     reasonably have been expected to avoid, and which by the  exercise
     of due diligence, it is unable to overcome.

17.  Legal and Contractual Requirements - All:

          a.    Laws,  permits,  approvals, regulations  or  orders  of
          governmental  authorities  applicable  to  the  Amended   and
          Restated  Power  Purchase  Agreement,  the  System,   Owner's
          obligations under this Agreement as owner of the  System  and
          Operator's scope of work hereunder;

          b.   Provisions of the System Contracts;
     c.   Agreements, warranties and specifications of Operator's or Owner's
          suppliers or vendors; and

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     d.   Operating and maintenance manuals and procedures furnished by
          Owner applicable to the System or the components thereof
          (such operating manuals to reflect Sound Independent Power
          Industry Practice)

18.  Liquidated Damages - As set forth in Exhibit A.

19.  MAJOR SYSTEM REPAIR -

  The inspection, overhaul, repair or replacement of any piece of
  equipment needed to operate the System where such inspection, overhaul,
  repair or replacement is the result of: (i) an unscheduled breakdown,
  repair, or failure of such equipment or (ii) a scheduled inspection,
  overhaul, repair or replacement of such equipment (unless the
  inspection, overhaul, repair or replacement has been incorporated into
  the Annual Operating Plan and Budget) and further that such inspection,
  overhaul, repair or replacement shall have a cost in excess of $10,000,
  which includes labor and material costs, and shall be adjusted each
  year by the increase or decrease in the Producer Price Index.
  Equipment shall include the gas turbines, the generators, boilers, heat
  steam recovery generators, chillers, load gears, exhaust ducting,
  emissions equipment, water and waste water treatment, fuel treatment
  facilities and interconnection facilities; provided, however, that a
  Major System Repair shall not include the replacement of accessories,
  equipment and consumables required in the ordinary course of Routine
  Maintenance and preventative maintenance of the System reflecting Sound
  Independent Power Industry Practice.

20.  Operating Fee - As set forth in Article VI, Section 1.

21.  Owner's Plan of Operation - Owner's instructions to Operator as to
     the  desired electricity and/or thermal energy production schedule
     and other operating and maintenance objectives.

22.  Owner's Representative - As set forth in Article V, Section 1(a).

23.  Producer  Price  Index - The U.S. Producer  Price  Index  for  All
     Items,  as currently published in the United States Department  of
     Labor  Bureau  of  Labor  Statistic's  monthly  publication,   PPI
     Detailed  Report or any successor publication of such information,
     or  if  such  index  is  no  longer published  or  the  method  of
     computation   thereof  is  substantially  modified,   a   mutually
     agreeable alternative index.

24.  Proprietary  Information - All financial, technical and  operating
     information  which  the parties, directly or  indirectly,  acquire
     from each other, and any other information which a party expressly
     designates  in  writing to be confidential.  However,  Proprietary
     Information  shall exclude information falling  into  any  of  the
     following categories:

          a.    Information that, at the time of disclosure thereof, is
          in the public domain;

          b.    Information that, after disclosure thereof, enters  the
          public domain other than by breach of this Agreement;

          c.    Information  that  prior  to  disclosure  thereof,  was
          already   in  the  recipient's  possession,  either   without
          limitation  on disclosure to others or subsequently  becoming
          free of such limitation;

          d.   Information obtained by the recipient from a third party
          having an independent right to disclose such information;

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          e.    Information  that is available by independent  research
          without  use  of  or  access to the  Proprietary  Information
          acquired from the other party; and

          f.     Information  that  a  party  is  required  by  law  or
          governmental  action  to  disclose, provided  the  disclosing
          party notifies the party from whom the information originated
          in advance and gives it the opportunity to resist the order.

25.  Routine  Maintenance - Those activities including the  replacement
     of   accessories,  equipment,  and  consumables  required  in  the
     ordinary  course  of routine and preventative maintenance  of  the
     System and System Site in accordance with Sound Independent  Power
     Industry Practice.

26.  Sound   Independent  Power  Industry  Practice  -  Those   prudent
     practices  and  methods in effect at the time of performance  that
     are customarily followed by operators of similarly situated plants
     and equipment.

27.  System  -  Owner's  properties, plant  and  equipment  located  in
     Sayreville,  New  Jersey, including a single gas turbine  combined
     cycle  generating station with a nominal capacity of approximately
     52 megawatts, more fully defined in Exhibit B.

28.  System Contracts -  Contracts and agreements to which Owner  is  a
     party (including, without limitation, insurance policies) relating
     to  the  operation  and maintenance of the System,  set  forth  on
     Exhibit C.

II.  ENGAGEMENT OF OPERATOR

1.   Effective on the Effective Date, Owner engages Operator to operate
     and  maintain  the  System  and perform  certain  duties,  all  as
     hereinafter set forth in this Agreement, and Operator accepts such
     engagement  to  operate and maintain the System  and  perform  the
     duties  specified in this Agreement in accordance with  its  terms
     and conditions.

2.   All  operating and management personnel involved in the  operation
     and  maintenance of the System shall be employees of  Operator  or
     its  Affiliates and shall not for any purposes be deemed employees
     of Owner.

III.      TERM

The  term  of this Agreement shall become effective upon the  Effective
Date  and expire on the sixth (6th) anniversary of the Effective  Date,
unless  terminated  earlier in accordance  with  Article  XII  of  this
Agreement.


IV.  OPERATING AND MAINTENANCE DUTIES OF OPERATOR

1.   Subject to the terms of this Agreement, Operator shall operate and
     maintain  the  System and shall control the details and  means  of
     performing its obligations hereunder.

2.   For the period prior to and including the Effective Date, Operator
     shall assist Owner in preparing the System for operation under the
     Amended  and  Restated Power Purchase Agreement.   These  services
     will include but not be limited to:

          a.   Preparing a plan and schedule to staff the System;

          b.   Recruiting and training the staff which will operate and
          maintain the System;

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          c.    Responding, in a timely manner, to Owner's requests for
          information;

          d.    Procuring, as agent for Owner, replacement of stock  of
          consumables,  spare parts, tools, and supplies in  accordance
          with the Annual Operating Plan and Budget;

          e.   Appointing a plant manager (subject to Owner's approval)
          who  shall  supervise the performance of Operator's employees
          at the System site;

          f.     Reviewing  plans,  specifications  and   drawings   of
          machinery  and  equipment  layouts and  commenting  to  Owner
          thereon  with  regard  to  matters  affecting  operation  and
          maintenance;

          g.    Observing and receiving training and instructions  from
          Owner,  such  training and instructions to be  in  accordance
          with Sound Independent Power Industry Practice;

          h.    Performing for Owner such other services  as  may  from
          time  to  time  be  reasonably requested  or  are  reasonably
          necessary or appropriate in connection with the operation and
          maintenance of the System; and

          i.    Reporting  to  and  consulting  with  Owner  about  the
          operation  of the System on a scheduled basis, as  reasonably
          requested by Owner.

                Such  services shall be provided in a manner consistent
     with  all  Legal  and Contractual Requirements, Sound  Independent
     Power Industry Practice and the Annual Operating Plan and Budget.

3.   All  full  time  personnel  whom Operator  will  provide  for  the
     operation and maintenance of the System shall be at the  site  and
     available  full  time  for training and  to  perform  services  to
     support  System  operation  and maintenance  as  required  by  the
     staffing plan to be developed by Operator and approved by Owner.

4.   A  written  management program shall be developed by Operator  for
     approval  by  Owner to ensure optimal performance, responsiveness,
     and  cost-effectiveness in the operation and maintenance  of   the
     System.  The program shall include provisions regarding:

     a.   Budget tracking, analysis and adjustments;

     b.   Personnel  policies,  including policies  regarding  payroll,
          compensation, pensions and other benefits;

     c.   Training;

     d.   Purchasing and inventory control;

     e.   A  System  safety  and  health  program  which  will  include
          procedures and a manual;

     f.   An   employee  job-site  handbook  for  Operator's  employees
          operating and maintaining the System;

     g.   A maintenance planning and scheduling system; and

     h.   A  system for maintaining an inventory of consumables,  spare
          parts, tools and supplies.

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5.   Subsequent  to  the  Effective Date, Operator  shall  provide  all
     operations  and  maintenance  services  necessary  to  efficiently
     operate  and  maintain the System, including but  not  limited  to
     performing the following operating and maintenance services:

          a.    Operating and maintaining the System in compliance with
          all  Legal  and  Contractual Requirements, Sound  Independent
          Power  Industry  Practice and the Annual Operating  Plan  and
          Budget;

          b.    Obtaining  and maintaining in effect all  licenses  and
          permits  required  by law to be obtained  and  maintained  in
          Operator's name and assisting Owner in obtaining and renewing
          all  licenses and permits required by law to be obtained  and
          maintained by Owner or in Owner's name;

          c.    Paying  all  its  employees, agents and  subcontractors
          promptly  and  filing all reports and remitting all  payments
          required under labor statutes to the appropriate governmental
          authorities, as the obligations arise;

          d.    Conducting the operations and maintenance of the System
          including,  but not limited to, entering into contracts  with
          third parties as agent for Owner (subject to Owner's approval
          if not in the ordinary course of business);

          e.    Employing, and ensuring adequate training of,  Operator
          employees  and  employees of its Affiliates   (duly  licensed
          where  required by statute or regulation) for  the  operation
          and   maintenance  of  the  System  consistent   with   Sound
          Independent   Power  Industry  Practice,  and  planning   and
          administering  all matters pertaining to employee  relations,
          salaries,   wages,  working  conditions,   hours   of   work,
          termination   of  employment,  employee  benefits,   employee
          staffing,  safety  and  related matters  pertaining  to  such
          employees, and maintaining records with respect to  all  such
          matters;

          f.    Monitoring,  preparing and maintaining records  of  the
          operations  and maintenance aspects of the System  (including
          records of financial, business, and sales tax aspects of  the
          System)  in such form and covering such matters as Owner  may
          reasonably  request, consistent with Sound Independent  Power
          Industry  Practice, generally accepted accounting principles,
          and  applicable  records retention requirements;  and  making
          such  records available for inspection and/or audit by  Owner
          and Owner's designees;

          g.    Implementing an inventory control system  to  identify,
          catalog, and disburse spare parts for the maintenance of  the
          System  and procuring, as agent for Owner, replacement  spare
          parts  and refurbishing, where practical or economical, spare
          parts to allow their reuse;

          h.    Operating and maintaining the System according  to  the
          operations and maintenance programs prepared by Operator  for
          Owner  and, if necessary, creating updates for such  programs
          and  creating  new  programs as required  for  operation  and
          maintenance of the System;

     i.   Operating and maintaining the System to maximize the continuous,
          reliable, safe and efficient generation of electrical and/or thermal
          energy by the System so as to conserve fuel and financial resources
          and to minimize unscheduled outages, and providing maintenance for the
          System in a cost-effective manner to prevent deterioration beyond
          normal wear and tear; provided, however, that Owner acknowledges such
          efforts shall necessarily be limited by the operating life,

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capacity and maintenance requirements of the System and by Legal and
          Contractual Requirements;


          j.    Using all reasonable care necessary to keep the  System
          and  the  System site clean, orderly, and free  from  debris,
          rubbish  or waste to the extent consistent with the operation
          of the System;

  k.   Taking necessary precautions and corrective actions in the event
       of an Emergency;

          l.   Keeping the System and the System site free and clear of
          all   liens  and  encumbrances  arising  out  of  the   acts,
          omissions, or debts of Operator or its employees,  agents  or
          subcontractors claiming by, through or under Operator   (this
          subsection  shall not apply to mechanics liens and  liens  of
          any  nature arising by operation of law, provided such  liens
          are  promptly removed by the payment of the debts they secure
          when  due; in the event of a dispute between Operator or  its
          subcontractors  and  a lienholder, Operator's  obligation  to
          Owner  pursuant  to this provision may be  satisfied  by  the
          posting  of  an appropriate bond to the extent acceptable  to
          the Agent);

          m.    Within  30  days  of its receipt  of  Owner's  Plan  of
          Operation  submitted in accordance with  Article  V,  Section
          1(c),  preparing and submitting to Owner for Owner's approval
          a  written  proposed Annual Operating Plan and  Budget  which
          shall  include all anticipated Expenses of the System  to  be
          paid  by Owner for each succeeding calendar year, all as more
          fully  described in Article VI, Section 6 or required by  the
          Agent;

          n.    Reporting  to  and  consulting  with  Owner  about  the
          operation  of the System on a scheduled basis, as  reasonably
          requested by Owner;

          o.    Using  reasonable  commercial efforts  to  secure  from
          vendors,  suppliers and subcontractors the best  indemnities,
          warranties  and  guarantees as may be commercially  available
          regarding supplies, equipment and services purchased for  the
          System,  all  of  which shall be assigned to Owner  (Operator
          shall  render reasonable assistance to Owner for the  purpose
          of  enforcing  such indemnities, warranties or guarantees  of
          which Owner is a beneficiary regarding the System);

          p.    Performing for Owner such other services  as  may  from
          time  to  time  be reasonably requested or are  necessary  or
          appropriate  in connection with the operation and maintenance
          of the System;

          q.   Promptly notifying Owner of:

                    i.   Any condition, event or act which is likely to
               result in a material deficiency in budgeted revenues, or
               excess in budgeted costs, of Owner;

                     ii.  Any forced outages or significant malfunction
               of the System as soon as practicable;

                     iii. Any material failure to comply with any Legal
               and  Contractual  Requirements or  any  event  which  is
               reasonably expected to cause such material failure;

          r.    Promptly providing Owner with such information relative
          to the System as Owner may reasonably request;

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          s.    Establishing  an  effective  maintenance  planning  and
          scheduling  system to optimize the availability,  reliability
          and heat rate of the System;

          t.    Assisting  Owner in the compliance by  Owner  with  the
          terms  of  the  Financing Agreements, as they relate  to  the
          operation  and  maintenance  of  the  System,  including  the
          preparation  of  reports  concerning  operations  and  making
          personnel available for discussions with the Agent  or  other
          lender representatives;

          u.    Subject  to Article XI, assisting Owner in  selling  or
          otherwise  disposing  of  used  and/or  unneeded  parts   and
          supplies; and

     v.   Providing and maintaining written procedures, in a form reasonably
          acceptable to Owner, required to enable Operator's employees to safely
          and efficiently start-up, operate, and shut down the System equipment
          and to perform preventative maintenance on the System equipment.

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V.        RESPONSIBILITIES OF OWNER

1.   Subject  to the terms of this Agreement, Owner shall, at its  cost
     and  expense,  perform  and provide the  following  at  the  times
     required to support the start-up, operation and maintenance of the
     System:

          a.    Providing an Owner's Representative who shall represent
          and  bind  Owner in all matters regarding this Agreement  and
          the performance of Owner hereunder;

          b.    Providing the System and System Site free and clear  of
          all   liens  and  encumbrances  (except  for  any  liens   or
          encumbrances  in  favor  of Agent or the  lenders  under  the
          Financing Agreements);

          c.    Preparing the Owner's Plan of Operation and  delivering
          the same to Operator on or before September 1 of each year;

          d.    With  Operator's assistance, administering  all  System
          Contracts;

          e.    Providing  all  required  utility  services,  including
          water,  sewer, telephone, water/waste water treatment,  waste
          disposal, special waste disposal and electricity;

     f.      With  Operator's assistance, obtaining and  reviewing  all
       necessary licenses and   permits except those required by law to be
       obtained and maintained in Operator's     name;

     g.    Providing  manufacturer's operating and maintenance  manuals
     for the System;

          h.   With Operator's assistance, preparing and submitting any
          special  accounting  and  reporting  documents  that  may  be
          required by governmental authorities;

          i.    Providing at its own expense, an office at the site for
          use by Operator;

          j.    Within  five  days  of its receipt  thereof,  providing
          Operator  complete copies of all technical,  operational  and
          other  System and System site related information,  including
          the  System Contracts, as are in the possession, or under the
          control, of Owner;

     k.   Being   responsible  for  the  billing  and   collection   of
          electricity  revenues under the Amended  and  Power  Purchase
          Agreement  and  thermal  revenues under  the  Steam  Purchase
          Contract with Newark Boxboard;

     l.   Being  solely  responsible  for  obtaining,  maintaining  and
          renewing all licenses and permits necessary for: (i) Owner to
          do  business  in  the jurisdictions in which  the  System  is
          located and (ii) the ownership, operation and maintenance  of
          the System and System site;

     m.   Being  responsible  for arranging the disposal  of  hazardous
          wastes generated by or at the System or System site; Operator
          will  coordinate removal of such waste from the  System  site
          using subcontractors chosen by Owner.

          n.   Complying with, and diligently enforcing, all agreements
          (including  the System Contracts) to which Owner is  a  party
          and  which  relate to or impact upon the System or Operator's
          ability to perform its obligations hereunder; and

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     o.     Timely  paying  all  of  Owner's  vendors,  suppliers   and
     contractors.

          Such activities shall be provided in a manner consistent with
     all  Legal  and Contractual Requirements, Sound Independent  Power
     Industry Practice and the Annual Operating Plan and Budget.

VI.  EXPENSES, REIMBURSEMENTS, BUDGET, CONSIDERATION, COMPENSATION

1.   As  compensation to Operator for its performance of the  services,
     Owner  shall  pay Operator  (a) the Expenses incurred by  Operator
     and  (b) an annual fee ("Operator's Fee").  The Operator's Fee for
     the  first Contract Year shall be $150,000.00.  The Operator's Fee
     shall  be  payable in equal monthly installments in arrears.   The
     Operator's Fee shall be adjusted annually in accordance  with  the
     following  sentence.  For  each  Contract  Year  after  the  first
     Contract  Year, the Operator's Fee shall be equal to  the  product
     of:  (i) the ratio of the Producer Price Index for the last  month
     of  the then expiring Contract Year over the Producer Price  Index
     for  the  last  month of the previous Contract Year and  (ii)  the
     Operator's  Fee  for  the then expiring Contract  Year;  provided,
     however,  that  for any partial Contract Year, the Operator's  Fee
     shall be multiplied by a fraction, the numerator of which shall be
     the total number of days in such Contract Year and the denominator
     of  which  shall  be 365 or 366, as the case may be.  If  Operator
     fails  to  pay  accrued,  undisputed  Liquidated  Damages  in  any
     Contract Year in accordance with the provisions herein, Owner  may
     elect to reduce the Operator's Fee in the subsequent Contract Year
     by the amount of undisputed Liquidated Damages owed to Owner.

2.   Owner shall directly pay, or promptly reimburse to Operator as the
     case  may be, the following expenses ("Expenses") relating to  the
     System:

          a.    Insurance  and  bond premiums for  policies  which  are
          required by Article VIII hereof;

          b.   Property and other taxes (including, without limitation,
          sales  taxes, gross receipts taxes, value added taxes, energy
          taxes and capital taxes) related to Owner or the System,  but
          not including those based on Operator's income or capital;

          c.    The  base  salaries,  straight time  hourly  wages  and
          overtime  hourly wages of all of Operator's on-site personnel
          plus  (i) thirty eight percent (38%) of (x) the base salaries
          and  straight  time  hourly wages and (y) the  straight  time
          hourly  portion of the actual overtime wages for  all  hourly
          employees,  and (ii) five percent (5%) of the base  salaries,
          straight time hourly wages, and overtime hourly wages.

          d.    Transportation,  travel, lodging,  and  (for  employees
          newly  hired or newly assigned to the System site) relocation
          expenses  of  persons employed by Operator or its  Affiliates
          performing  the  duties  of  Operator  under  this  Agreement
          subject to advance approval by Owner in writing;

          e.    Reasonably incurred legal and accounting fees  relating
          to  the  System,  subject to advance  approval  by  Owner  in
          writing;

          f.    Fuel  expenses including fuel purchase, transportation,
          handling and demurrage charges;

          g.    The expenses of purchased electric power, telephone and
          other  communication services, purchased potable water, waste
          disposal,  special waste disposal, lubricants  and  chemicals
          necessary for the operation of the System;

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          h.    Costs reasonably incurred or paid by Operator due to an
          Emergency;

          i.   Training, including outside training services;

          j.    The  costs of permits or licenses required  for  either
          Owner, Operator or the System;

     k.   Costs associated with Routine Maintenance, Major System Repairs
          (including scheduled and unscheduled) inspections, and overhauls,
          outside contractor services and purchases of replacement equipment,
          parts and components;

     l.   Spare parts, tools, supplies and consumables;

          m.    Capital  costs  approved  by  Owner  for  improvements,
          alterations  or  additions  to  the  System  including  those
          required   by  governmental  laws,  regulations   or   orders
          including    without   limitation,   those    arising    from
          environmental concerns; and

          n.    The  cost  of  transportation of  spare  parts,  tools,
          supplies,  consumables and any item which is  a  reimbursable
          expense hereunder.

     For  all  Expenses  (other than relating to labor  and  legal  and
     accounting fees) incurred and paid by Operator for which  Operator
     is  entitled to reimbursement hereunder, Owner additionally  shall
     pay  Operator  a general and administrative expense  fee  of  five
     percent (5%) of such Expenses.

3.        a.    For convenience and in order to save on expenses, Owner
          will  directly  pay certain of the Expenses  reimbursable  to
          Operator as set forth in the Annual Operating Plan and Budget
          described  in Article VI, Section 2 as practicable.   To  the
          extent  reasonably  practical,  the  items  covered  by  such
          Article  VI,  Section 2 shall be procured through  Operator's
          issuance of an Owner purchase order and the cost of any  such
          items  shall be paid directly by Owner to the vendor thereof.
          Operator shall perform such duty as Owner's agent.

          b.    Without  Owner's  prior  approval,  Operator  shall  be
          empowered  to prepare and issue an Owner purchase  order  for
          any material or service the cost of which would constitute an
          Expense, so long as the total cost for such item is less than
          or  equal  to $10,000.  For any item or items whose  cost  is
          greater   than  $10,000,  Operator  shall  submit  a  written
          requisition  to Owner, and after receipt of written  approval
          from  Owner, Operator shall be authorized as agent for  Owner
          to  prepare and issue a purchase order on behalf of Owner  on
          Owner's  purchase order form for such item.   Operator  shall
          (i)  verify  the receipt at the System site of all  materials
          and  services to be delivered to the System site  covered  by
          Owner's purchase orders issued by Operator, (iii) verify  the
          accuracy  of  vendors' invoices in connection therewith,  and
          (iv)  forward such invoices to Owner for approval, processing
          and  payment  by  Owner.   Nothing in  this  Agreement  shall
          prevent  Operator from procuring any material or service  the
          cost  of  which would constitute an Expense under Article  VI
          Section 2.

     c.   Operator shall periodically, but not more often than once a week,
          deliver to Owner invoices received by Operator from third parties for
          all direct Expenses, accompanied by a summary of all such invoices
          which itemizes all such invoices by operating cost account number.
          Such invoices shall also be accompanied by a statement from Operator
          confirming that all such invoices are accurate, due and payable,
          together with all relevant documentation reasonably necessary for

                                   11

<PAGE>

          Owner to verify the accuracy thereof.  Each invoice submitted to
          Owner shall be paid by Owner directly to the payee of such invoice
          on or before the date such invoice is due.


4.   From time-to-time, Operator will prepare and send to Owner an
     invoice, including expense statements, vouchers or such other
     supporting information as Owner may reasonably require, for the amounts
     then due for reimbursable Expenses and the monthly installment of the
     Operator's Fee.  Owner shall pay the amount due to Operator no later
     than  30 days after receipt of the invoice.  All payments shall be
     made by wire transfer of immediately available funds to Norwest Bank,
     Minneapolis, Minnesota  Account No. (to be furnished later).  Any
     payment not made within 30 days after receipt of the invoice will bear
     interest from the date on which payment was due at the rate of one and
     one-half (1.5%) percent per month or the maximum rate permitted by law,
     whichever is the lesser.

5.   Operator  shall  maintain complete, true, and correct  records  in
     connection with all Expenses incurred by Operator.  Operator shall
     retain all such records for five (5) years after Expense reimbursement
     by Owner has been fulfilled or for any longer period of time required
     by law.  All documents and records relating to this Agreement shall be
     available for inspection by Owner anytime during normal business hours.
     Owner  may audit all records of Operator relating to Expenses  and
     services performed hereunder.  In the event the audit shows that the
     payment by Owner to Operator exceeds the amount due Operator, Owner
     shall disclose such information to Operator and Operator shall refund
     the  excess amount to Owner within five (5) business days  of  the
     disclosure to Operator.  In the event the audit shows that the payment
     by Owner to Operator is greater than the amount due Operator under this
     Agreement  and such error was caused by Operator, Owner  shall  be
     reimbursed its reasonable costs of performing the audit.  In the event
     the audit shows that the payment by Owner is less than the amount due
     Operator, Owner shall disclose such information to Operator and pay the
     underpayment amount to Operator within five (5) business days of the
     disclosure to Operator.

6.     On  or before October 1 of each year, the Operator shall prepare
     and  submit  to Owner a written Annual Operating Plan  and  Budget
     which  shall include all expenses of the System anticipated to  be
     paid  by  Owner as either a direct or reimbursable Expense  during
     the  upcoming  calendar  year pursuant to  subsection  1  of  this
     Article  VI,  together with a written operations  and  maintenance
     plan for the same period of time.  Such Annual Operating Plan  and
     Budget  shall set forth the anticipated operations and maintenance
     plan including projected electrical production from the System  on
     a   monthly  basis,  and  a  complete  schedule  (to  the   extent
     technically  feasible) of Operator responsible Routine Maintenance
     and  all  Owner-directed major maintenance tasks (including  Major
     System  Repairs)  to be accomplished during said year.  Owner  and
     Operator  shall agree upon the budget, operations and  maintenance
     plan,  and persons to perform maintenance under the plan prior  to
     the  start  of  the  calendar year, and shall  meet  and  exchange
     information as is necessary and convenient to such end.

     If the parties cannot reach agreement on the Annual Operating Plan
     and  Budget  by the start of any calendar year, then,  until  such
     time  as  agreement  is reached or the dispute  is  resolved,  the
     Annual  Operating Plan and Budget for such calendar year shall  be
     based  on  the Annual Operating Plan and Budget for the  preceding
     calendar  year,  as adjusted to reflect the net  change,  if  any,
     between the most recently published Producer Price Index available
     on  the  first  day  of  the calendar year  in  question  and  the
     corresponding Producer Price Index in effect at the start  of  the
     immediately preceding calendar year.

     Operator  has  submitted,  and  Owner  has  accepted,  the  Annual
     Operating  Plan  and Budget for the calendar year ending  December
     31, 1997, a copy of which is attached as

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<PAGE>

     Exhibit  F.   All Annual Operating Plan and Budgets  shall  be  in
     substantially  the form attached as Exhibit F.   The  amounts  set
     forth  on Exhibit F shall be reduced pro rata based on the  number
     of  days  remaining  in  the calendar  year  from  and  after  the
     Effective  Date.  Likewise, the amounts set forth  in  the  Annual
     Operating  Plan and Budget in effect during the calendar  year  in
     which this Agreement expires or is terminated shall be reduced  on
     a  pro rata basis based actual number of days elapsed during  such
     calendar  year prior to the date of the expiration or  termination
     of this Agreement.

7.        a.    The  parties  recognize that Changes  may  be  required
          during the term of  this Agreement.  Either Owner or Operator
          may  by a written notice to the other party propose a Change.
          The  written  notice  shall describe the proposed  Change  in
          reasonable detail and the reasons therefor.

               b.   The written notice of a Change proposed by Operator
          shall  be  accompanied  by a Change Order  Budget  Statement.
          Upon  receipt by Operator of any proposed Change from  Owner,
          Operator shall use its best efforts to prepare and submit  to
          Owner  a  Change Order Budget Statement with respect to  such
          proposed  Change within fifteen (15) days of the  receipt  of
          Owner's  proposed  Change.  No proposed Change  the  cost  of
          which  is in excess of $10,000 shall be implemented  until  a
          Change Order has been executed by both parties approving  the
          Change   and  the  related  Change  Order  Budget  Statement;
          provided,  however,  that  Operator  shall  be  entitled   to
          implement  a  proposed Change without the prior  approval  of
          Owner  if  such  Change is required due to an Emergency.   If
          Operator  implements a Change without the prior  approval  of
          Owner  due  to  an Emergency, Operator shall promptly  notify
          Owner  of such Change and pursue Owner's approval thereof  in
          accordance  with  subsection c below.  Operator  acknowledges
          that  Owner's  approval  of any proposed  Change  and/or  the
          related  Change  Order  Budget  Statement  may  require   the
          approval of the Agent.

          c.    Owner  and Operator shall diligently and in good  faith
          endeavor to reach agreement upon any proposed Change and  the
          related Change Order Budget Statement within thirty (30) days
          after  the  date  of  the receipt of a  proposed  Change  and
          related  Change  Order  Budget Statement.   If  a  Change  is
          required  as  a  result of an Emergency, then Operator  shall
          provide  to  Owner, as soon as practicable,  notice  of  such
          Change,  together with a statement describing  the  Emergency
          and  a Change Order Budget Statement.  If a Change due to  an
          Emergency causes the Annual Operating Plan and Budget  to  be
          exceeded and Owner believes that an Emergency did not  exist,
          then  Owner  shall have the right to dispute the Change.   If
          Owner and Operator do not agree as to the resolution of  such
          dispute,  then  either  party  may  submit  the  dispute   to
          arbitration  in  accordance with the  provisions  of  Article
          XVIII Sections 2 and 3.

8.   Operator  shall report to Owner in writing monthly  on  electrical
     and  thermal  output and expenditures incurred to date;  projected
     electrical and thermal output and expenditures for the balance  of
     the  calendar  year; performance to date under the operations  and
     maintenance  plan and such other matters as Owner  may  reasonably
     request  as  to the operation and maintenance of the  System.   In
     such  report, Operator shall recommend such changes  to  the  then
     current  budget  and operations and maintenance plan  as  Operator
     considers necessary or appropriate.

     9.    Operator shall use its best efforts to operate and  maintain
the System each year within the budget approved by Owner (as amended by
Change  Orders).  For purposes of determining the approved  budget  for
the  initial  calendar year, the budget provided as Exhibit  F  in  the
aggregate  amount  of $1,606,997, for operating and maintenance  duties
set  forth  in  Article  IV, shall be adjusted  by  the  ratio  of  the
remaining number of days from the Effective Date to year-end divided by
366.  If for any calendar year the Expenses

                                   13

<PAGE>

  (other  than  those Expenses set forth in Article VI, Section  2  (b)
  and Expenses incurred in response to Emergencies), whether direct  or
  reimbursable,  paid  by  Owner exceed the approved  Annual  Operating
  Plan  and  Budget,  as amended by Change Orders  mutually  agreed  by
  Owner  and  Operator, then Operator shall be solely  responsible  for
  any such excess.

10.   Operator's consideration for services performed and expenses paid
   pursuant  to  this Agreement shall be the reimbursement of  expenses
   described in Section VI(2), the Operator's Fee, and, if applicable, the
   Bonus.

                                        14

<PAGE>

VII. INDEMNIFICATION

1.   Operator will protect, indemnify and hold harmless Owner,  Owner's
     Affiliates  and  Agent, and their respective directors,  officers,
     employees, agents and representatives against and from any and all
     demands,  losses,  claims,  actions  or  suits,  including  costs,
     judgments, penalties, fines and attorney's fees, for or on account
     of  injury  to  or  death of third persons, or for  damage  to  or
     destruction  of  property  belonging  to  third  persons  or   for
     violation  of law, in each case resulting from or arising  out  of
     Operator's  negligent maintenance or operation of  the  System  or
     Operator's willful act or omission, except to the extent caused by
     System  design or construction defect, by Owner's act or omission,
     or the act or omission of third parties.

2.   Owner   will  protect,  indemnify  and  hold  harmless   Operator,
     Operator's  Affiliates, and their respective directors,  officers,
     employees, agents and representatives against and from any and all
     demands,  losses,  claims,  actions  or  suits,  including  costs,
     judgments, penalties, fines and attorneys' fees, for or on account
     of  injury  to  or  death of third persons, or for  damage  to  or
     destruction  of  property  belonging  to  third  persons,  or  for
     violation of law, in each case resulting from or arising out of  a
     System design or construction defect, or the negligence or willful
     act or omission of Owner.

3.   The  duty  to indemnify under this Article will continue  in  full
     force and effect, notwithstanding the expiration or termination of
     this Agreement, with respect to any claim or action based on facts
     or conditions which occurred prior to such termination.

4.   If  any  indemnified  party intends to seek indemnification  under
     this  Article  from  any indemnifying party with  respect  to  any
     action or claim, the indemnified party shall give the indemnifying
     party  notice of such claim or action within thirty (30)  days  of
     the  commencement of, or actual knowledge by the indemnified party
     of,  such claim or action.  The indemnifying party shall  have  no
     liability  under this Article for any claim or actions  for  which
     such  notice  is not provided; provided, however, so long  as  the
     indemnifying  party  is not materially harmed by  the  indemnified
     party's  failure to give timely notice of a claim or action,  then
     the indemnifying party's indemnity obligation shall be unaffected.
     The indemnifying party shall, at its sole cost and expense, defend
     any  such claim or action; provided, however, that the indemnified
     party  shall,  at  its own cost and expense,  have  the  right  to
     participate  in  the defense or settlement of any  such  claim  or
     action.  The indemnified party shall not compromise or settle  any
     such  claim  or  action without the prior written consent  of  the
     indemnifying  party,  which  consent  shall  not  be  unreasonably
     withheld.

VIII.     INSURANCE COVERAGE

1.   Operator, on its behalf and on the behalf of all subcontractors of
     Operator  performing any on-site services in connection  with  the
     operation  and maintenance of the System or any of its appurtenant
     equipment,  shall procure and maintain in effect during  the  term
     for  which  they perform services pursuant to this  Agreement  the
     following minimum insurance coverages, in the given amounts:

          a.    Vehicle  liability insurance covering all  owned,  non-
          owned  and  hired  automobiles, trucks,  trailers  and  other
          vehicles.   Such  insurance shall provide coverage  not  less
          than that of the standard comprehensive automobile policy  in
          limits  not  less than $1,000,000 combined single limit  each
          occurrence for bodily injury and property damage.  The  Owner
          and  NRG  Generating (U.S.) Inc. shall be named as additional
          insureds.

                                                          15

<PAGE>

          b.   Workers' Compensation Insurance that satisfies statutory
          requirements and Employers' Liability Insurance  with  limits
          of  $1,000,000.   This  insurance shall  include  All  States
          Coverage  and Longshoreman & Harbor Workers Compensation  Act
          coverage  (if  exposure  exists)   The  Employer's  Liability
          Coverage shall not contain occupational disease exclusion.

          c.    Liability Insurance, on an "Occurrence" basis and in  a
          form  providing coverage not less than that of  the  standard
          Commercial  General  Liability, covering  operations  of  the
          System   including  independent  contractors,  products   and
          completed  operations  with broad  form  blanket  contractual
          liability coverage (for any written or oral contracts related
          to  the  System) and personal injury liability  coverage  for
          claims arising out of the operations of the System for bodily
          injury  and property damage (broad form, including  completed
          operations)  in  policy  limits  not  less  than   $1,000,000
          combined   single  limit  each  occurrence   and   $2,000,000
          aggregate  limit.   The aggregate policy limits  shall  apply
          solely  to  this project or site.  Coverage shall  include  a
          standard severability of interests clause and cross liability
          coverage.  The Owner and NRG Generating (U.S.) Inc. shall  be
          named as additional insureds.

          d.     Excess   or  umbrella  liability  Insurance,   on   an
          "Occurrence" basis and with coverage at least as broad as the
          vehicle liability, employers' liability and general liability
          policies, to provide limits of insurance in excess of Owner's
          vehicle liability, employers' liability and general liability
          policies for not less than $10,000,000 combined single  limit
          each  occurrence  and  in the aggregate  for  bodily  injury,
          property  damage  and personal injury.  The aggregate  policy
          limits  shall apply solely to this project or site.  Coverage
          shall include a standard severability of interests clause and
          cross  liability  coverage.  The  Owner  and  NRG  Generating
          (U.S.) Inc. shall be named as additional insureds.

2.   Owner shall procure and maintain in effect during the term of this
     Agreement at its expense the following minimum insurance coverage:

          a.    Vehicle  liability insurance covering all  owned,  non-
          owned  and  hired  automobiles, trucks,  trailers  and  other
          vehicles.   Such  insurance shall provide coverage  not  less
          than that of the standard comprehensive automobile policy  in
          limits  not  less than $1,000,000 combined single limit  each
          occurrence  for  bodily  injury  and  property  damage.   The
          Operator  and NRG Generating (U.S.) Inc. shall  be  named  as
          additional insureds.

          b.   Workers' Compensation Insurance that satisfies statutory
          requirements and Employers' Liability Insurance  with  limits
          of  $1,000,000.   This  insurance shall  include  All  States
          Coverage  and Longshoreman & Harbor Workers Compensation  Act
          coverage  (if  exposure  exists)   The  Employer's  Liability
          Coverage shall not contain occupational disease exclusion.

     c.   Liability Insurance, on an "Occurrence" basis and in  a  form
          providing coverage not less than that of the standard Commercial
          General Liability, covering operations of the System including
          independent contractors, products and completed operations with broad
          form blanket contractual liability coverage (for any written or oral
          contracts related to the System) and personal injury liability cover-
          age for claims arising out of the operations of the System for bodily
          injury and property damage (broad form, including completed opera-
          tions) in policy limits not less than $1,000,000 combined single
          limit each occurrence and $2,000,000

                                   16

<PAGE>

          aggregate limit.  The aggregate policy limits shall apply solely to
          this project or site.  Coverage shall include a standard
          severability of interests clause and cross liability
          coverage.  The Operator and NRG Generating (U.S.) Inc. shall
          be named as additional insureds.


          d.     Excess   or  umbrella  liability  Insurance,   on   an
          "Occurrence" basis and with coverage at least as broad as the
          vehicle liability, employers' liability and general liability
          policies, to provide limits of insurance in excess of Owner's
          vehicle liability, employers' liability and general liability
          policies for not less than $10,000,000 combined single  limit
          each  occurrence  and  in the aggregate  for  bodily  injury,
          property  damage  and personal injury.  The aggregate  policy
          limits  shall apply solely to this project or site.  Coverage
          shall include a standard severability of interests clause and
          cross  liability coverage.  The Operator and  NRG  Generating
          (U.S.) Inc. shall be named as additional insureds.

          d.    "All  Risk"  Property Insurance, including  Boiler  and
          Machinery  Insurance  and difference in  conditions  coverage
          (including  flood  perils), with an  extension  for  Business
          Interruption  Coverage,  and  naming  Operator  and  NRG   as
          additional insureds for all such insurance coverage as  their
          interests appear.

3.   Within  thirty  (30)  days after the date  of  execution  of  this
     Agreement,  each party shall provide to the other party,  pursuant
     to  the  notice  provisions  of  Article  XIV,  properly  executed
     certificates  of insurance, signed by an authorized representative
     of  the  insurance carrier.  These certificates shall provide  the
     following information:

          a.    Name of insurance company, policy number and expiration
          date;

          b.    The coverage required and the limits on each, including
          the amount of deductibles and self-insured retentions;

          c.    A  statement indicating that sixty (60) days notice  of
          cancellation, non-renewal,  or material change in coverage of
          any  of the policies shall be given to each named insured and
          any additional insured; and

          d.   Named and additional insured.

4.   Each  party  shall  have the right to inspect  and  photocopy  the
     policies  of  insurance  at the other party's  place  of  business
     during regular business hours, on reasonable prior written notice.

5.      All   insurance   policies,  including  Workers'   Compensation
     Insurance,  provided by Owner and Operator shall waive all  rights
     of subrogation against one another and NRG .

6.   The  provision of insurance shall not be construed  to  limit  the
     liability of any party to the other party.

7.   All  commercial  insurance carriers providing insurance  hereunder
     must be rated A- or   better, with a minimum size rating of VIII by
     Bests  Insurance Guide and Key Ratings or an equivalent rating  by
     another nationally recognized insurance rating agency of a standing
     similar to Best.

     8.    All  deductibles or self insured retentions associated  with
policies  required hereunder shall be the responsibility of  the  named
insured.

IX.  ENGAGEMENT OF THIRD PARTIES

                                   17

<PAGE>

Operator  may engage or subcontract in the ordinary course of  business
and at Owner's expense such persons, corporations or other entities  as
Operator deems advisable for the purpose of  performing or carrying out
any of the obligations of Operator under this Agreement.  Except in the
case of an Emergency, before incurring an Expense in excess of $10,000,
Operator shall obtain the prior written approval from Owner.

X.   OPERATOR REPORTING OBLIGATIONS

Operator  shall provide Owner with copies of all reports  generated  by
Operator's  employees, agents, or subcontractors with  respect  to  the
operation  of  the  System that are filed with any federal,  state,  or
local  agency  or  governmental entity.  In  addition,  Operator  shall
provide  Owner with monthly compliance reports, summarizing  Operator's
compliance   with  all  System  permits  and  licenses.   All   monthly
compliance  reports shall be delivered to Owner within  ten  (10)  days
after the last day of the relevant month.

XI.  SPECIFIC LIMITATIONS

In  the  conduct of its duties hereunder, Operator shall  not,  without
first obtaining the written consent of Owner:

1.   Limit   on   Expenditures.   Under-take  an  expenditure   outside
     Operator's  scope of responsibilities except that, in case  of  an
     Emergency, Operator may make such immediate expenditures as may be
     necessary, but notice of any such Emergency and expenditures shall
     be  given  to Owner as promptly as possible, but in no  case  more
     than 12 hours after the event.

2.   Settlement of Claims.  For any claim for which Owner is or may  be
     responsible,  pay  in excess of $10,000 in the settlement  of  any
     claim  for injury to or death of persons, or loss of or damage  to
     property, or in settlement of any contract or other dispute.

3.   Disposition  of Equipment.  On Owner's behalf, sell  or  otherwise
     dispose of any item of equipment which is part of or used  in  the
     operating  or maintaining the System if the current price  of  new
     equipment similar thereto is in excess of $5,000.

4.   Contracts  with  Affiliates.  On Owner's behalf,  enter  into  any
     contract  with an Affiliate of Operator with a value in excess  of
     $5,000.

XII. TERMINATION/DEFAULT

1.   This Agreement may be terminated:

          a.    By  the non-defaulting party at any time following  the
          occurrence  of  any  Event of Default, as described  in  this
          Article XII, if such Event of Default is not cured within the
          period, if any, provided therefor;

          b.   By Operator, if, after Operator has taken all reasonable
          efforts  to  avoid regulation as a public utility, Operator's
          performance under this Agreement renders Operator subject  to
          regulation as a public utility by any federal, state or local
          agency of any governmental entity, by delivery of thirty (30)
          days' prior written notice to Owner;

     c.   By Operator, if Owner's action or inactions under this Agreement
          renders Operator subject to regulation as a public utility by any
          federal, state or local agency of any governmental entity, by delivery
          of thirty (30) days' prior written

                                   18

<PAGE>

          notice to Owner;

     d.   By Owner for its convenience, upon 90 days' written notice to
          Operator, provided that Owner pays Operator the applicable termination
          charge in accordance with the provisions of Exhibit D (no termination
          of this Agreement under this provision may be effective until the
          third anniversary of the Effective Date);

     e.   By Owner, if, at, on, or in connection with the operation and
          maintenance of any part or all of either or both of (x) the System or
          (y) the properties, plant or equipment operated by Operator for NRG
          Generating (Newark) Cogeneration, Inc., Operator fails to comply in
          all material respects with all applicable laws, permits, licenses,
          regulations, or orders of any Governmental Authority; provided,
          however, that no failure of Operator to perform its obligations under
          this Article XII, Section 1(e) shall be grounds for termination if
          such failure is the result of the negligence of a third party other
          than subcontractors of or procured by Operator or Operator's affili-
          ates or an act of Force Majeure, so long as Operator is diligently
          pursuing a cure as required by this Agreement.  Owner may exercise its
          right of termination under this Article XII action 1(e), if and
          when Owner believes that Operator has failed to achieve and main-
          tain compliance with an applicable law, permit, license, regulation or
          order, whether or not (s) a court or administrative agency with
          competent jurisdiction has determined that there has been such a fail-
          ure or (t) a dispute resolution process has determined that the fail-
          ure was not the result of either negligence of a third party other
          than subcontractors or an act of Force Majeure which Operator is
          diligently attempting to cure; provided, however, that following any
          termination by Owner under this Article XII Section 1(e), if (u) a
          court or administrative agency, with competent jurisdiction to
          assess a fine, penalty or other action for failures in
          circumstances of the sort which were the basis of Owner's
          termination, issues a final nonappealable order (or issues an order
          for which all appeals periods have expired) determining as a matter
          of both fact and law that the circumstances which were the basis of
          Owner's termination did not constitute a violation of any law,
          permit, license, regulation or order, or v) a dispute resolution
          process under Article XVIII determines that the failure was the result
          of negligence of a third party other than subcontractors or an act of
          Force Majeure which Operator is diligently attempting to cure, then
          Owner shall pay Operator the amount determined in accordance with
          Exhibit E.;

          f.   By the mutual agreement of the parties; and

     g.   By   Owner,  if  the  Amended  Power  Purchase  Agreement  is
          terminated for any reason other than a default by Owner or an
          Owner Affiliate.

2.   Owner  shall be in default under this Agreement upon the happening
     or  occurrence of any of the following events or conditions,  each
     of which shall be deemed to be an Event of Default for purposes of
     this Agreement:

          a.    Owner  materially breaches any of Owner's  obligations,
          covenants,  conditions,  services or  other  responsibilities
          under  this  Agreement unless within thirty (30)  days  after
          notice  from  Operator specifying the nature of such  breach,
          Owner either cures such breach or, if such breach (other than
          the  failure  to  make payment obligations) cannot  be  cured
          within  thirty  (30)  days,  Owner commences  and  diligently
          pursues  such  cure  and thereafter continues  to  diligently
          pursue such cure.  If the breach is not cured within 120 days
          of  the  date  of  Operator's written notice to  Owner,  then
          Operator may terminate this Agreement;

                                        19

<PAGE>

          b.    There  is  an  assignment for the  benefit  of  Owner's
          creditors,  or  Owner or its parent company,  NRG  Generating
          (U.S.) Inc., is adjudged bankrupt, or a petition is filed  by
          or  against  Owner or its parent company under the provisions
          of  any  insolvency or bankruptcy laws (and such petition  is
          not  dismissed  within  six  months),  or  the  business   or
          principal assets of Owner or its parent company are placed in
          the  hands  of a receiver, assignee or trustee, or  Owner  is
          dissolved, or Owner's existence is terminated or its business
          is discontinued; or

          c.    Any  material representation or warranty  furnished  by
          Owner  in connection with this Agreement was knowingly  false
          or  misleading  in any material respect at the  time  it  was
          made.

3.   Operator  shall  be  in  default under  this  Agreement  upon  the
     happening  or  occurrence  of  any  of  the  following  events  or
     conditions,  each  of which shall be deemed  to  be  an  Event  of
     Default for purposes of this Agreement:

          a.    Operator  materially breaches or fails  to  observe  or
          timely  perform  any  of  Operator's obligations,  covenants,
          conditions,   services   or   responsibilities   under   this
          Agreement,  unless within thirty (30) days after notice  from
          Owner  specifying  the  nature of  such  breach  or  failure,
          Operator  either  cures such breach or failure  or,  if  such
          breach  cannot  be  cured within thirty (30)  days,  Operator
          commences  and  diligently pursues such cure  and  thereafter
          continues  to diligently pursue such cure.  If the breach  is
          not  cured  within  120 days of the date of  Owner's  written
          notice to Operator, then Owner may terminate this Agreement;

          b.    There  is  an assignment for the benefit of  Operator's
          creditors, or Operator is adjudged bankrupt, or a petition is
          filed  by  or against Operator under the provisions  of   any
          insolvency  or  bankruptcy laws (and  such  petition  is  not
          dismissed  within six months), or the business  or  principal
          assets  of  Operator are placed in the hands of  a  receiver,
          assignee  or trustee, or Operator is dissolved, or Operator's
          existence is terminated or its business is discontinued; or

     c.         Any  material representation or warranty  furnished  by
          Operator  in  connection  with this Agreement  was  knowingly
          false or misleading in any material respect at the time  when
          made.

     Notwithstanding subsection (a) above, Operator (i)  shall  not  be
     afforded any cure period, (ii) will not be permitted to invoke  or
     utilize the Article XVIII Dispute Resolution provisions, and (iii)
     will  be  subject to immediate termination if the  termination  of
     this  Agreement  is effected under the language  of  Article  XII,
     Section 1(e).

4.   Upon  the  occurrence of an Event of Default,  the  non-defaulting
     party may:

          a.    Without  recourse  to  legal  process,  terminate  this
          Agreement  by delivery of a written notice of termination  to
          the defaulting party or its assigns; and/or

          b.    Pursue,  concurrently  or  separately,  other  remedies
          existing  in  law,  any  provision  of  this  Agreement,   or
          otherwise.

5.        Upon  termination  or expiration of this Agreement,  Operator
          shall:

     a.   Deliver to Owner all books, records, operator logs, accounts and
          manuals developed or maintained by Operator pursuant to this
          Agreement, provided however, that Operator may retain copies of
          such documents.  Furthermore,

                                   20

<PAGE>

Owner shall have the right to take possession of all of the equipment,
          spare parts and supplies purchased for the System and paid
          for by Owner;


          b.    At Owner's request and expense, cooperate with Owner to
          effect   an   orderly  transition  of  the   operations   and
          maintenance  of  the  System, including, without  limitation,
          perform the following:

               i.    Continue to operate the System in accordance  with
               this Agreement for a period not to exceed 180 days while
               Owner appoints and mobilizes a successor operator;

               ii.   Assist  Owner  in preparing an  inventory  of  all
               material,  equipment, spare parts and supplies purchased
               for the System; and

               iii.   Assign   to  Owner  all  Operator's   contractual
               agreements with third parties relating to the operations
               or  maintenance  of  the  System,  to  the  extent  such
               agreements are so assignable.

XIII.     ACCESS TO SYSTEM

Operator  and  Owner and their agents, representatives,  and  employees
shall have full and free access at all times to the System.

XIV. NOTICES

1.   Any notice required or permitted under this Agreement shall be  in
     writing and shall be valid and sufficient if delivered personally,
     mailed  by  registered or certified mail, or sent by a  recognized
     private  overnight express delivery service.  In each case postage
     prepaid, return receipt requested, addressed to the other party as
     follows:

     If to Operator:

          NRG Services, Inc.
          1221 Nicollet Mall,  Suite 700
          Minneapolis, Minnesota 55403
          Attn:  NRG Asset Manager
          Telephone:  612-373-5498

     If to Owner:

          NRG Generating (U.S.) Inc.
          1221 Nicollet Mall, Suite 600
          Minneapolis, Minnesota  55403
          Attn:  Chief Executive Officer
          Telephone:  612-373-5300

2.   Any party may change its address, or add additional addresses,  by
     notice given to the other parties in the manner set forth above.


XV.  FURTHER ASSURANCES

1.   Owner  and Operator agree to execute, acknowledge and deliver  any
     and all such further documents and instruments and to take such action
     as may reasonably be required in

                                   21

<PAGE>

     order  to  allow  the  financing of  the  System  to  proceed,  to
     effectuate  the  purpose  of this Agreement,  and  to  obtain  any
     government permits, licenses, or approvals necessary or convenient
     to accomplish the foregoing.

2.   Title  to  all materials, equipment, supplies, consumables,  spare
     parts  and other items purchased or obtained by Operator  for  the
     System  shall pass to and vest in Owner upon the passage of  title
     from   the   vendor  or  supplier  thereof  and  the  payment   or
     reimbursement of Operator's costs by Owner.

XVI. REPRESENTATIONS AND WARRANTIES

1.   Owner represents and warrants to Operator as follows:

          a.    Owner  is a corporation duly formed, validly  existing,
          and  in good standing under the laws of Delaware, and  it  is
          properly qualified to do business in New Jersey;

          b.   The execution of this Agreement has been duly authorized
          and   approved   by   Owner,  and  no  other  authorizations,
          approvals,  or  consents  are  required  in  order  for  this
          agreement  to  constitute  a binding  and  enforceable  legal
          obligation of Owner;

          c.    The  execution  of this Agreement  by  Owner,  and  the
          performance of Owner's obligations under this Agreement  will
          not  conflict  with, or result in a breach or default  under,
          any  agreement,  contract, or covenant to which  Owner  is  a
          party; provided, however, that this provision is modified  to
          be  consistent with Section 7 of the Agreement which is being
          executed contemporaneously herewith as an inducement  to  the
          execution of this agreement; and

          d.   This Agreement, as executed, constitutes a binding legal
          obligation  of  Owner that is enforceable in accordance  with
          its terms and conditions.

2.   Operator represents and warrants to Owner as follows:

          a.    Operator  is  a corporation duly incorporated,  validly
          existing,  and in good standing under the laws  of  Delaware,
          and it is properly qualified to do business in New Jersey;

          b.    The  execution of this Agreement by Operator  has  been
          duly   authorized  an  approved  by  Operator  and  no  other
          authorizations, approvals, or consents are required in  order
          for  this  Agreement to constitute a binding and  enforceable
          legal obligation of Operator;

          c.    The  execution of this Agreement by Operator,  and  the
          performance of its obligations under this Agreement will  not
          conflict  with, or result in a breach or default  under,  any
          agreement,  contract,  or covenant to  which  Operator  is  a
          party; and

          d.    This Agreement as executed, constitutes a binding legal
          obligation of Operator that is enforceable in accordance with
          its terms and conditions.

XVII.     FORCE MAJEURE

1.   Except  for  the obligation of either party to make  any  required
     payments hereunder, the parties shall be excused from performing their
     respective obligations under this Agreement and shall not be liable in
     damages or otherwise if and to the extent that they

                                   22

<PAGE>

     are  unable  to so perform or are prevented from performing  by  a
     Force Majeure, provided that:

          a.    The  non-performing party, as promptly  as  practicable
          after  the occurrence of the Force Majeure, but in  no  event
          later  than 14 days thereafter, gives the other party written
          notice describing the particulars of the occurrence;

          b.   The suspension of performance is of no greater scope and
          of  no  longer  duration than is reasonably required  by  the
          Force Majeure;

          c.   The non-performing party uses its best efforts to remedy
          its inability to perform; and

          d.    As  soon as the non-performing party is able to  resume
          performance  of its obligations excused as a  result  of  the
          occurrence, it shall give prompt written notification thereof
          to the other party.

2.    Neither  party  shall be required to settle any strike,  walkout,
  lockout or other labor dispute on terms which, in the sole judgment of
  the  party involved in the dispute, are contrary to its interest,  it
  being understood and agreed that the settlement of strikes, walkouts,
  lockouts  or  other  labor  disputes shall  be  entirely  within  the
  discretion of the party having such dispute.

XVIII  DISPUTE RESOLUTION

1.   Resolution by Parties.

          a     First  Attempt.   In the event that  a  dispute  arises
          hereunder  between the parties, the parties shall attempt  in
          good  faith  to  settle  such dispute by  mutual  discussions
          within  30  days  after the date that a party  gives  written
          notice  of the dispute to the other party; provided, however,
          that  if  the  dispute involves any amount claimed  under  an
          invoice  and after 10 days of mutual discussion either  party
          believes  in  good  faith that further  discussion  will  not
          resolve  the  dispute  to its satisfaction,  such  party  may
          immediately  refer  the matter to arbitration  in  accordance
          with subsection 2 of this Article XVIII.

         b     Chief Executive Officers.  In the event that the dispute
          is  not  resolved in accordance with subsection 1 (a)  above,
          either  party  may refer the dispute to the  chief  executive
          officers  or  chief  operating  officers  of  the  respective
          parties  for further consideration.  In the event  that  such
          individuals are unable to reach agreement within 15 days,  or
          such  longer period as they may agree, then either party  may
          refer the matter to arbitration in accordance with subsection
          2 of this Article XVIII.

2.   Arbitration.   In  the event a dispute arises  between  Owner  and
     Operator which is not resolved pursuant to Section 1 of this Article
     XVIII, shall be resolved by arbitration pursuant to the terms hereof.
     As a condition to initiating arbitration proceedings, a party must
     first have attempted to resolve the dispute under Section 1 of this
     Article XVIII.  All claims, disputes, and other matters in question
     arising out of or relating to this Agreement or the breach thereof,
     shall be decided by arbitrators selected as hereinafter provided and
     shall be conducted in accordance with the Commercial arbitration Rules
     of the American Arbitration Association then obtaining, unless the
     parties mutually agree otherwise.  The resolution of such disputes
     shall not delay Operator's or Owner's performance of their undisputed
     obligations under the terms of this Agreement.  The arbitration shall
     be held in Newark, New Jersey and any arbitration demand must be filed
     with the American Arbitration Association office located closest to
     Newark, New Jersey.  If the claim or

                                   23

<PAGE>

     defense  of  either  party  is determined  to  be  frivolous,  the
     arbitrators  may require that the party at fault pay or  reimburse
     the  other  party for (i) fees and expenses, including,  attorneys
     and  expert fees and expenses, and (ii) reasonable out  of  pocket
     expenses  incurred  by  the other party  in  connection  with  the
     arbitration   proceedings.   Notwithstanding  the   foregoing,   a
     termination  of the Agreement under the language of  Article  XII,
     Section  1(e)  shall  not,  under any  circumstances  (except  for
     disputes  relating to the settlement of payment  obligations),  be
     subject to arbitration under this Article XVIII.

3.   Selection  of  Arbitrators.  Each dispute shall  be  submitted  to
     three  arbitrators, one arbitrator being selected  by  Owner,  one
     arbitrator  being  selected by Operator, and the third  arbitrator
     being  selected by the two so selected.  The party initiating  the
     arbitration  shall include in its notification under subsection  4
     below  the  designation of its selected arbitrator and  the  party
     receiving such notification shall designate its arbitrator  within
     fifteen  (15) days thereafter by notify the initiating  party  and
     its  arbitrator of the selection.  If the arbitrators selected  by
     Owner  and  Operator  cannot agree on a  third  arbitrator  within
     fifteen  (15)  days after the second arbitrator is  selected,  the
     third  arbitrator  shall be selected by the  American  Arbitration
     Association.  In the event the party receiving notification  of  a
     demand for arbitration shall not have selected its arbitrator  and
     given  notice thereof to the other party and its arbitrator within
     fifteen   (15)  days  after  receiving  such  notification,   such
     arbitrator   shall   be  selected  by  the  American   Arbitration
     Association.

4.   Notice.   Notice  of  demand for arbitration  shall  be  filed  in
     writing  with  the  other  party to this Agreement  and  with  the
     American Arbitration Association.  The demand shall be made within
     a  reasonable  time after the claim, dispute or  other  matter  in
     question has arisen.  In no event shall the demand for arbitration
     be  made after the date when the applicable statute of limitations
     would bar institution of a legal or equitable proceeding based  on
     such claim, dispute, or other matter in question.

5.   Award.    This   agreement  to  arbitrate  shall  be  specifically
     enforceable  under  the  prevailing arbitration  law.   The  award
     rendered  by  the arbitrators shall be final and judgment  may  be
     entered  upon  it in accordance with applicable law in  any  court
     having jurisdiction thereof.

6.     Survival.   This  Article  shall  survive  termination  of  this
Agreement.


XIX. GENERAL PROVISIONS

1.   Governing  Law.  This Agreement shall be governed by and construed
     under the laws of New Jersey.

2.   Counterparts.   This  Agreement  may  be  executed   in   multiple
     counterparts, each of which shall be deemed an original,  but  all
     of which together shall constitute one and the same instrument.

3.   Headings.  Title and headings of the Articles and Sections of this
     Agreement are for convenience of reference only and do not form  a
     part of and shall not in any way affect the interpretation of this
     Agreement.

4.   Amendment.   No modification or amendment of this Agreement  shall
     be  valid unless in writing and executed by both parties  to  this
     Agreement.

5.   Assignment.   This  Agreement  may not  be  assigned  by  Operator
     without  the  written  consent of Owner and written  agreement  of
     assignee  whereby it expressly assumes and agrees to perform  each
     and every obligation of Operator hereunder.  Any assignment by

                                   24

<PAGE>

     Operator  in violation hereof shall be null and void.  Owner  may,
     without  the consent of Operator, assign its rights (but  not  its
     obligations)  under  this Agreement to or by a  lender  (including
     finance lessor) providing funds to refinance the System.

6.   Successors and Assigns.  This Agreement shall be binding and inure
     to  the  benefit  of  the  parties  hereto  and  their  respective
     successors and assigns, to the extent that assignment is permitted
     under this Agreement.

7.   Entire Agreement.  This Agreement constitutes the entire agreement
     between   the   parties,  supersedes  all  prior  representations,
     documents or statements transmitted between the parties.

8.   Consequential  Damages.  In no event will Owner or  Operator  have
     the  right, with or without legal process, to recover punitive  or
     special  damages,  or indirect or consequential damages,  such  as
     loss  of use, lost profits, costs incurred because of delays, cost
     of  replacement energy, "idle plant" costs, interest  on  borrowed
     money, letters of credit, security deposits or bonds.  In no event
     will  Owner  or  Operator be liable for representations,  oral  or
     otherwise,  as to the results intended to be achieved through  its
     undertakings  pursuant to this Agreement, except  as  specifically
     provided in this Agreement.

9.   Other Provisions.  Nothing in this Agreement shall be construed to
     prevent or prohibit Operator from providing operating services  to
     any other person, organization, or entity.

10.  Waiver.  The waiver of any breach of any term or condition  hereof
     shall  not  be deemed a waiver of any other or subsequent  breach,
     whether of like or different nature.

11.  Not  for  Benefit of Third Parties. This Agreement  and  each  and
     every  provision  thereof  is for the  exclusive  benefit  of  the
     parties  to  this Agreement and not for the benefit of  any  third
     party.

12.  Survival  of  Representations, Warranties  and  Indemnities.   All
     representations,  warranties and indemnities of  the  parties  set
     forth   in  this  Agreement  shall  survive  the  termination   or
     expiration of this Agreement.

13.  Approval  by Proposed Lender.  If any provision of this  Agreement
     must  be  approved  by  a  lender, lessor or  equity  investor  in
     connection  with the financing of the System or any  other  action
     contemplated hereby, and such lender requires any modification  of
     the provisions of this Agreement, neither Owner nor Operator shall
     unreasonably  withhold  its approval and  execution  of  any  such
     modifications.

14.  Survival  of Obligations.  Termination of this Agreement  for  any
     reason  shall  not  relieve Owner or Operator  of  any  obligation
     accruing or arising prior to such termination.

15.  Confidentiality.  The parties shall hold in confidence, and  shall
     use  only  for  the  purposes  of  this  Agreement,  any  and  all
     Proprietary Information disclosed to each other.

16.  Severability.  Should any section or subsection hereof be declared
     invalid  or  unenforceable for any reason, the remaining  sections
     and  subsections of this Agreement shall remain in full  force  an
     effect, and the parties hereto agree to immediately renegotiate in
     good  faith such section or subsection as was declared invalid  or
     unenforceable.

17.  Duty  to  Mitigate.   Each  party must use  its  best  efforts  to
     mitigate the injury or damage caused by the other party's failure to
     perform.  When a party seeking damages fails to

                                   25

<PAGE>

     make these efforts, the other party shall be entitled to have  the
     damages accordingly reduced.

18.  Consent.  Except in the case of an Emergency, when either  party's
     consent or approval is required, such consent or approval must  be
     in  writing  and given prior to the act for which such consent  or
     approval is sought.

19.  Reasonableness.  Except as expressly stated to be within the  sole
     discretion  of  any party, all consents or approvals  required  of
     either  party  shall not be unreasonably withheld or delayed,  nor
     shall any acts or requests of a party be unreasonable in light  of
     the surrounding facts and circumstances.

20.  Disclaimer.    THE  WARRANTIES  EXPRESSLY  PROVIDED  BY   OPERATOR
     HEREUNDER  ARE  THE SOLE, INTENDED WARRANTIES AND OPERATOR  HEREBY
     DISCLAIMS  ALL  OTHER WARRANTIES OF ANY KIND,  WHETHER  STATUTORY,
     ORAL,   WRITTEN,  EXPRESS  OR  IMPLIED,  INCLUDING   ALL   IMPLIED
     WARRANTIES   OF  MERCHANTABILITY  AND  FITNESS  FOR  A  PARTICULAR
     PURPOSE,  AND  ALL WARRANTIES ARISING FROM COURSE  OF  DEALING  OR
     USAGE OF TRADE.

21.  Limits  on  Liability. Notwithstanding any provision contained  in
     this  Agreement  to the contrary, for any Contract Year,  Operator
     shall not be liable to Owner (whether by contract, warranty, tort,
     statute  or  otherwise, including Liquidated Damages or  penalties
     owed by Operator under this Agreement) for any amounts that in the
     aggregate exceed the amount of the Operating Fee and Bonuses  paid
     for  the  Contract Year in which the claim is made.  If a claim(s)
     is  made  after  the end of the term, then the claim(s)  shall  be
     deemed  to  have been made in the last Contract Year of the  term.
     The  limits of liability set forth herein shall not apply  to  any
     damages incurred by a party as a result of its gross negligence or
     willful misconduct.

IN  WITNESS  WHEREOF, the parties hereto have executed  this  Agreement
effective as of the day and year first set forth above.

OWNER:                             OPERATOR:

NRG Generating (Newark)            Power Operations, Cogeneration Inc.



By:/s/ Leonard Bluhm               By:/s/ Timothy P. Hunstad

Its: President                     Its:Secretary


                                   26

<PAGE>

                               EXHIBIT A

BONUS/LIQUIDATED DAMAGES



For  the  purpose  of  determining the liquidated damages  ("Liquidated
Damages") payable by Operator, or the bonus ("Bonus") payable by  Owner
to  Operator, the effectiveness of Operator under this Agreement  shall
be  measured  in  terms  of both availability  and  heat  rate.   These
measurements  shall be applied at the completion of each Contract  Year
to determine the Liquidated Damages or Bonus for that Contract Year.

Availability.   Operator  shall undertake  to  operate  the  System  to
maximize availability.  Availability will be measured for Base Capacity
level,  as defined as 52 Mwe (net).  In each case the following formula
will be used:

Contract Availability = [Total Hours - (Equivalent Contract Unavailable
                                        Hours)]
                                             Total Hours

     where:

     Total Hours = total hours in the Contract Year; and

     Equivalent Contract Unavailable Hours = total of all hours  during
     the  Contract Year during which there occurred a full  or  partial
     Planned, Forced, or Maintenance Outage, as those terms are defined
     by Edison Electric Institute as Equivalent Availability (including
     outages resulting from Force Majeure events, but excluding outages
     resulting  from (x) JCP&L's failure to supply natural gas  to  the
     Facility   during   periods  when  PSE&G   has   not   interrupted
     transportation  that  it  supplies  under  the  PSE&G  Gas  Supply
     Agreement and (y) JCP&L's failure to accept available Output  from
     the  Facility).   Partial outages are measured on  an  equivalency
     basis,  e.g., a 50% outage for one hour would be equivalent  to  a
     full outage for one-half hour, and so forth.

Availability.  For  purposes of Bonus/Liquidated  Damages  availability
calculation, the target Base availability will be 95%, for the term  of
this  Contract.   Each one tenth of one percent (0.1%) of  availability
will  have  a  value  of $20,000 as a Bonus or Liquidated  Damages  for
availability measurement.

Heat   Rate.   For  purposes  of  Bonus/Liquidated  Damages  heat  rate
calculations, the heat rate incentive will be based on 9750 Btu per kwh
HHV,  as calculated in accordance with Article A.9 of the Amended Power
Purchase Agreement, for the term of this Contract.

                                   27

<PAGE>

LIQUIDATED DAMAGES AND BONUS

The  Liquidated  Damages payable by Operator to  Owner  and  the  Bonus
payable  by  Owner  to Operator shall be based on the Availability  and
Heat Rate guarantees set forth in this Exhibit.  For any Contract Year,
the  maximum Liquidated Damages (in the aggregate for each category  as
adjusted  by the amounts of any Bonus payable to Operator)  payable  by
Operator  shall  be  no  more than one hundred percent  (100%)  of  the
Operator's  Fee for such Contract Year.   For any Contract  Year,  once
the  aggregate Bonuses payable to Operator (adjusted for the Liquidated
Damages, if any, owed by Operator) equal $250,000, then any amounts  in
excess  of  $250,000 shall be payable to Operator at a rate of  40%  of
such   excess.     The   availability  and  heat   rate   bonus/penalty
calculations will be calculated monthly and payable to the end  of  the
Contract  Year  as set forth in the Third Amendment to  Power  Purchase
Agreement.

                                   28

<PAGE>

                               EXHIBIT B
                       DESCRIPTION OF THE SYSTEM

NEWARK SYSTEM


The  facility is a combustion gas turbine-steam turbine combined-cycle,
topping cycle cogeneration facility.


The  nominal rating is 52 MW electrical with average thermal output  of
45,000  lbs/hr  steam.  The prime movers of the plant  is  one  General
Electric  Frame 6 dual fuel combustion turbine, driving  a  54,000  kVA
synchronous generator with electrical output PH, 60 Hz and 13.8 kV.


The exhaust from the Frame 6 turbine is directed into a three drum (tri-
pressure) heat recovery steam generator ("HRSG").  The HRSG at full
turbine load and 59F ambient temperature produces when fired with 94.0
million BtuHHV an hour of auxiliary filing, 227,000 lbs/hr of 600 psig,
700 F steam; 23,000 lbs/hr of 285 psig/500 F steam; and 12,300 lbs/hr
of 30 psig D&S steam.

The 600 psig steam is directed to the condensing extraction steam
turbine which drives a 22,000 kVa synchronous generator with an
electrical output of 3PH, 60 Hz and 13.8 kV.

The 165 psig steam extracted from the steam turbine is directed into a
header from which 45,000 lbs/hr is directed to process to dry
paperboard.

Thermal loads of the system vary seasonally +/- 5,000 lbs from an
average of 45,000 lbs/hr over the course of an 8760 hour year.

The plant will operate on natural gas under normal circumstances other
then interruptions due to curtailment of supply on extremely cold days.
Kerosene fuel is used as the alternate, approximately 480 hr/yr.
Output of the combustion turbine is controlled by sensing and
maintaining a constant optimum turbine exhaust temperature.

     NOX  emission  from the plant are controlled by a  combination  of
steam  injection  into the combustion turbine and  Selective  Catalytic
Reduction using anhydrous ammonia injection with a semi-precious  metal
catalyst  in the HRSG.  The plant is equipped with Continuous  Emission
Monitoring equipment.

                                   29

<PAGE>

                               EXHIBIT C

SYSTEM CONTRACTS

SYSTEM CONTRACTS

NEWARK



Power Purchase Agreement                          dated 04/30/96
Transmission Service and
  Interconnection Agreement                       dated 11/17/87
Gas Service Agreement                             dated 04/30/96
Steam Purchase Agreement                          dated 10/03/86
                                              Amended 03/08 & 07/20/88


Permits

Air Permit/Certification (Rental Boiler Stack)    issued 03/11/93
Sewer Connection Permit                           issued 09/17/95
NJPDES General Permit                             issued N/A
Air Permit/Certification (Keeler Boiler Stack)    issued 03/28/94
Air Permit/Certification (Fuel Oil Storage Tank)issued 08/13/90
Air Permit/Certification (Stack #1)               issued 12/10/87
Stormwater Discharge Permit                       issued 10/15/93

                                   30

                               EXHIBIT D

TERMINATION FOR CONVENIENCE

Commencing on the third anniversary of the Effective Date, the Owner
may terminate this agreement as set forth in Article XII.  The
termination fee shall be $200,000 pro-rated based on the number of
calendar days remaining in the Agreement term as the numerator and 1096
calendar days as the denominator.  The termination fee will be adjusted
accordingly for any pro-rated undisputed bonus/liquidated damage
payments due the Operator on the Termination Date.

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                               EXHIBIT E

Outstanding obligations under existing O&M Agreement

                                  32

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                               EXHIBIT F
1997 Budget

                             SEE ATTACHED

                                  33