Exhibit 10(f)1







                              NEW CENTURY ENERGIES

                  SALARY DEFERRAL AND SUPPLEMENTAL SAVINGS PLAN
                             FOR EXECUTIVE OFFICERS

                       (As Adopted Effective July 1, 1998)





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                              NEW CENTURY ENERGIES
                  SALARY DEFERRAL AND SUPPLEMENTAL SAVINGS PLAN
                             FOR EXECUTIVE OFFICERS

                                TABLE OF CONTENTS

ARTICLE I GENERAL

   Sec. 1. 1 Name of Plan ..............................................   1
   Sec. 1.2 Purpose.....................................................   1
   Sec. 1.3 Effective Date..............................................   1
   Sec. 1.4 Company.....................................................   1
   Sec. 1.5 Participating Employers ....................................   1
   Sec. 1.6 Construction and Applicable Law ............................   1

ARTICLE II DEFINITIONS

   Sec. 2.1 Accounts ...................................................   1
   Sec. 2.2 Base Salary.................................................   2
   Sec. 2.3 Beneficiary.................................................   2
   Sec. 2.4 Board.......................................................   2
   Sec. 2.5 Code........................................................   3
   Sec. 2.6 Committee...................................................   3
   Sec. 2.7 Common Shares...............................................   3
   Sec. 2.8 Company Credits.............................................   3
   Sec. 2.9 Compensation................................................   3
   Sec. 2.10 Disability.................................................   3
   Sec. 2.11 ERISA......................................................   3
   Sec. 2.12 Investment Credits.........................................   3
   Sec. 2.13 Participant................................................   3
   Sec. 2.14 Plan Year..................................................   3
   Sec. 2. 15 Prior PSCo Plan...........................................   3
   Sec. 2.16 Prior SPS Plan.............................................   3
   Sec. 2.17 Retirement.................................................   4
   Sec. 2.18 Savings Plan...............................................   4
   Sec. 2.19 Successor Employer.........................................   4
   Sec. 2.20 Valuation Date.............................................   4

ARTICLE III PARTICIPATION

   Sec. 3.1 Eligibility for Participation ..............................   4
   Sec. 3.2 Duration of Participation ..................................   4
   Sec. 3.3 No Guarantee of Employment .................................   5

ARTICLE IV DEFERRED COMPENSATION AND CREDITS TO ACCOUNTS

   Sec. 4.1 Election to Defer Compensation..............................   5
   Sec. 4.2 Company Credits ............................................   7



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   Sec. 4.3 Investment Credits and Valuation of Accounts ...............    7
   Sec. 4.4 Dividends on Common Shares .................................    8
   Sec. 4.5 Adjustment of Stock Accounts for Splits, Dividends, Etc ....    8

ARTICLE V DISTRIBUTION OF ACCOUNTS

   Sec. 5.1 Time for Distribution ......................................    9
   Sec. 5.2 Manner of Payment ..........................................    9
   Sec. 5.3 Amount of Payment ..........................................    9
   Sec. 5.4 Beneficiary Designation ....................................    9
   Sec. 5.5 Distributions for Severe Financial Hardship ................    9
   Sec. 5.6 Modification of Elections for Tax Considerations ...........   10
   Sec. 5.7 Withholding and Taxes ......................................   10

ARTICLE VI ADMINISTRATION

   Sec. 6.1 Administration by the Committee ............................   11
   Sec. 6.2 Claims Procedure ...........................................   11

ARTICLE VII AMENDMENT AND TERMINATION

   Sec. 7.1 Amendment ..................................................   11
   Sec. 7.2 Termination of Plan ........................................   11

ARTICLE VIII MISCELLANEOUS

   Sec. 8.1 Unsecured Obligations ......................................   12
   Sec. 8.2 Benefits May Not Be Assigned or Alienated ..................   12
   Sec. 8.3 Incompetency................................................   12
   Sec. 8.4 Notices.....................................................   12
   Sec. 8.5 Severability................................................   12
   Sec. 8.6 Headings....................................................   12
   Sec. 8.7 Capitalized Definitions ....................................   12
   Sec. 8.8 Gender .....................................................   12
   Sec. 8.9 Use of Compounds of Word "Here .............................   13
   Sec. 8. 10 Construed as a Whole .....................................   13



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                              NEW CENTURY ENERGIES
                  SALARY DEFERRAL AND SUPPLEMENTAL SAVINGS PLAN
                             FOR EXECUTIVE OFFICERS

                                    ARTICLE I

                                     GENERAL

     Sec. 1.1 Name of Plan.  The name of this plan is the "New Century  Energies
Salary Deferral and Supplemental  Savings Plan for Executive Officers" (referred
to hereinafter as the "Plan").

      Sec.  1.2  Purpose  The Plan has been  established  to provide  additional
future income to certain select executive  officers through voluntary  deferrals
of Compensation and Company Credits related to matching  contributions under the
Savings Plan.  Those portions of the Prior PSCo Plan and the Prior SPS Plan that
covered  individuals  who are  Participants in this Plan as of July 1, 1998 were
merged into this Plan as of that date,  and the  benefits  of such  Participants
under the  applicable  Prior Plan shall  thereafter be provided  pursuant to the
provisions of this Plan.

     Sec. 1.3 Effective  Date. The "Effective  Date" of the Plan, the date as of
which the Plan was established, is July 1, 1998.

     Sec. 1.4 Company.  For purposes of this Plan,  "Company"  means New Century
Energies, Inc., a Delaware corporation, and any Successor Employer thereof.

      Sec.  1.5  Participating   Employers.  The  Company  is  a  "Participating
Employer"  in  the  Plan.   Any   subsidiary  of  the  Company  shall  become  a
Participating Employer in this Plan upon being so designated in a written action
by the  Committee,  effective  as of the date  specified by the  Committee.  Any
Successor  Employer to a  Participating  Employer shall also be a  Participating
Employer.  A  Participating  Employer shall cease to be such effective as of the
date  specified in a written action by the Committee;  provided,  however,  that
such action shall not cause  Participants  employed by such  employer to forfeit
benefits accrued prior to such date.

      Sec. 1.6  Construction  and Applicable  Law. The Plan is intended to be an
unfunded  plan  maintained  primarily  for the  purpose  of  providing  deferred
compensation for a select group of management or highly  compensated  employees,
within the meaning of Sections  201(2),  301(a)(3) and  401(a)(1) of ERISA.  The
Plan is not intended to qualify  under Code Section  401(a) or 403(a).  The Plan
shall be administered and construed  consistent with said intent. This Plan also
shall be governed  and  construed  in  accordance  with the laws of the State of
Colorado as applied to contracts executed and to be wholly performed within said
state to the extent that such laws are not  preempted  by the laws of the United
States of America.

                                   ARTICLE II

                                   DEFINITIONS

     Sec.  2.1  Accounts.  "Accounts"  shall be  established  for each  eligible
Participant  reflecting the amounts owed to the Participant or the Participant's
Beneficiary  under  the  terms  of this  Plan.  The  following  Accounts  may be
established for each Participant:



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     (a)  Cash Account.  A Cash Account shall be  established  to which shall be
          credited the amounts of Compensation deferred by the Participant under
          Sec.  4.1 (other  than  amounts  the  Participant  has elected to have
          deposited in his or her  Directable  Stock Account) and the Investment
          Credits under Sec. 4.3 related to those deferrals.  The  Committee may
          maintain  sub-accounts  for a  Participant  within the Cash Account to
          reflect the investment options for that Account under Sec. 4.3.

      (b)  Stock  Accounts.  The  following  types  of Stock  Accounts  shall be
           established for a Participant:

           (1) Directable  Stock Account.  The  Participant's  Directable  Stock
               Account  shall be  credited  with  all  amounts  of  Compensation
               deferred  by the  Participant  under  Sec.  4.1  and  accumulated
               Investment  Credits on those  deferrals which the Participant has
               elected to be deemed to have been invested in Common Shares.

           (2) Nondirectable  Stock  Account.  The  Participant's  Nondirectable
               Stock  Account  shall  be  credited  with  any  Company   Credits
               determined  under Sec.  4.2, and  adjustments  under Sec. 4.4 and
               Sec. 4.5 related to those credits.

      (c)  Prior  Plan  Accounts.  The  Accounts  of  an  individual  who  is  a
           Participant in this Plan on July 1, 1998 and who was a participant in
           the Prior PSCo Plan or the Prior SPS Plan on June 30, 1998,  shall be
           initially credited as of July 1, 1998 as follows:

           (1) The Participant's Cash Account shall be credited with the balance
               credited to his or her cash  account in the Prior PSCo Plan as of
               June 30, 1998 and the Participant's  Nondirectable  Stock Account
               shall be credited with the number of Common  Shares.  credited to
               his or her stock account under the Prior PSCo Plan as of June 30,
               1998.

           (2) The  Participant's  Nondirectable  Stock Account will be credited
               with  a  number  of  Common  Shares  equal  to the  value  of the
               Participant's  matching  account under the Prior SPS Plan on June
               30, 1998, and the Participant's  Directable Stock Account will be
               credited with a number of Common Shares equal to the value of the
               Participant's  other  accounts  under  the Prior SPS Plan on that
               date,  in each case  divided  by the  average of the high and low
               sale prices of a Common  Share on the New York Stock  Exchange on
               June 30, 1998.  This  paragraph  will be applied by assuming that
               June 30, 1998 is a "valuation date" under the Prior SPS Plan.

Each  Participant  is always  100%  vested  in  amounts  credited  to his or her
Accounts.

     Sec. 2.2 Base Salary.  "Base  Salary" means a  Participant's  annual salary
rate in effect from time to time during each Plan Year, unreduced for any salary
deferrals under any Company savings, incentive or other employee benefit plan.

     Sec. 2.3 Beneficiary.  "Beneficiary" means the person or persons designated
as such pursuant to the provisions of Sec. 5.4.

      See. 2.4 Board. "Board" means the board of directors of the Company.

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     Sec. 2.5 Code.  "Code" means the Internal  Revenue Code of 1986, as amended
from time to time, and any successor statute.

     Sec. 2.6 Committee.  "Committee"  means the  Compensation  Committee of the
Board or any other  committee  appointed  by the Board to  administer  the Plan.
However,  no member of the Committee who is also a Participant  in this Plan may
participate in or vote or any matter involving the Plan.

     Sec. 2.7 Common  Shares.  "Common  Shares"  means  shares of the  Company's
common stock.

     Sec. 2.8 Company Credits.  "Company  Credits" are the credits  allocable to
the Participant's Nondirectable Stock Account pursuant to Sec. 4.2.

      Sec.  2.9   Compensation   "Compensation"   for  a  Plan  Year  means  the
compensation  to which  the  Participant  is  entitled  from  the  Participating
Employers  with  respect to the Plan Year,  including  any Base  Salary  payable
during the Plan Year,  any annual  incentive  bonus earned  under the  Company's
annual  incentive plan for the Plan Year and payable in the following Plan Year,
and any cash or Company stock incentive bonus earned for the Plan Year under any
other plan that may be established by the Company,  if so permitted by the terms
of such plan (regardless of when paid).

      See.  2.10  Disability.  "Disability"  means,  for  a  period  of up to 24
consecutive  months,  a  Participant's  inability  as a result of an accident or
illness to perform the essential functions of the Participant's current position
or any position the Participant held within the 90 day period  immediately prior
to such  accident  or  illness,  and at the end of said  24  month  period,  the
Participant  is  permanently  unable to engage  in any and every  occupation  or
business for  compensation  or profit for which the  Participant  is  reasonably
fitted by education, training or experience.

     See. 2.11 ERISA.  "ERISA" means the Employee Retirement Income Security Act
of 1974, as amended from time to time, and any successor statute.

     Sec. 2.12 Investment Credits.  "Investment Credits" are the gains or losses
allocable  to the Cash  Accounts of a  Participant  under Sec.  4.3 based on the
investment indexes elected by the Participant, and adjustments for dividends and
other  transactions to the Participant's  Stock Accounts under Sec. 4.4 and Sec.
4.5.

     Sec. 2.13  Participant.  A "Participant"  means any executive  officer of a
Participating  Employer who has been  designated  in writing by the Committee as
eligible for this Plan.

     See.  2.14 Plan  Year.  A "Plan  Year" is the  12-consecutive-month  period
commencing on each January 1 and ending on the following  December 3 1. However,
the first Plan Year of the Plan begins on July 1, 1998 and ends on December  31,
1998.

     See.  2.15 Prior  PSCo Plan.  "Prior  PSCo Plan"  means the Public  Service
Company of Colorado Executive Savings Plan, as in effect on June 30, 1998.

     Sec. 2.16 Prior SPS Plan.  "Prior SPS Plan" means the  Southwestern  Public
Service  Company  Non-Qualified  Salary  Deferral Plan, as in effect on June 30,
1998.

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      Sec. 2.17 Retirement. "Retirement" means termination of employment with a
Participating Employer after attaining age 62.

     See.  2.18  Savings  Plan.  "Savings  Plan" means the New Century  Energies
Savings Plan, as it may be amended from time to time.

     Sec. 2.19  Successor  Employer.  A "Successor  Employer" is any entity that
succeeds  to the  business  of the  Company  or another  Participating  Employer
through merger,  consolidation,  acquisition of all or substantially  all of its
assets,  or any other means and which elects before or within a reasonable  time
after such succession,  by appropriate action evidenced in writing,  to continue
the Plan.

     See. 2.20  Valuation  Date.  "Valuation  Date" means each date on which the
Accounts of Participants  are valued for purposes of this Plan.  Valuation Dates
shall  include the last day of each month and such other dates as the  Committee
determines are necessary or advisable for the administration of the Plan.

                                   ARTICLE III

                                  PARTICIPATION

     Sec. 3.1 Eligibility for Participation.  A Participant's  eligibility under
this Plan shall be subject to the following:

      (a)  The Participant will become eligible to elect to make deferrals under
           Sec. 4.1 and to receive  Company  Credits under Sec. 4.2 effective as
           of the date  specified  by the  Committee  in the  written  notice of
           participation.  However,  deferrals will not commence under Sec. 4. 1
           until  the  effective  date of an  election  filed  pursuant  to that
           section.

      (b)  An  employee  who is  designated  as a  Participant  before  the last
           calendar  quarter of a Plan Year may wait until the following year to
           make deferrals of Compensation or may elect to make deferrals for the
           partial Plan Year (for Compensation earned after the calendar quarter
           of the election to defer),  and in either case such Participant shall
           be eligible  for Company  Credits  under  Section 4.2 for the partial
           Plan Year, unless the Committee  determines otherwise at the time the
           employee is designated as a Participant.

     Sec. 3.2 Duration of  Participation.  An employee who becomes a Participant
shall  continue to be  eligible to make  elections  under Sec.  4.1  thereafter,
subject to the following:

      (a) The Participant's deferrals shall cease on the earliest of.

           (1) The  date  the  Participant   terminates   employment  with  the
               Participating Employers.

           (2) The date  specified in a written  notice  issued by the Committee
               revoking the individual's status as a Participant.

           (3) The date the  Participant  fails to meet the  requirements of any
               regulations  which may be issued by the  Department of Labor that
               define  the  phrase   "select   group  of  management  or  highly
               compensated employees" under ERISA.

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      (b)  An individual  shall continue to be a Participant for purposes of the
           provisions of the Plan other than Sec. 4.1 or Sec. 4.2 until the date
           all of his or her Accounts have been distributed.

      (c)  If an employee who has elected to make deferrals  under Sec. 4. 1 for
           a particular Plan Year is subsequently  determined not to be eligible
           to be a  Participant  for that Plan  Year,  the  employee's  deferral
           election  for that year will be canceled  and any  amounts  which may
           have already been deferred for that year will be promptly refunded to
           the employee.

     Sec.  3.3 No Guarantee of  Employment.  Participation  in the Plan does not
constitute  a  guarantee  or  contract  of  employment  with  the  Participating
Employers.  Such  participation  shall in no way  interfere  with any rights the
Participating  Employers  would  have in the  absence of such  participation  to
determine the duration of the employee's employment.

                                   ARTICLE IV

                  DEFERRED COMPENSATION AND CREDITS TO ACCOUNTS

      See. 4.1 Election to Defer Compensation. An eligible Participant may elect
to have  Compensation with respect to each Plan Year credited to his or her Cash
Account and/or Directable Stock Account rather than being paid in cash,  subject
to any limitations that may be imposed by the Committee. Elections shall be made
on forms  specified by the  Committee  for  purposes of this Plan,  and shall be
filed in the manner specified by the Committee. The Compensation for a Plan Year
of a Participant who elects deferrals under this section shall be reduced by the
percentage or amount so elected, subject to the following:

      (a)  Elections for each Plan Year must be filed during the election period
           specified by the Committee for that Plan Year,  which period must end
           on or prior to  December  31 of the  previous  year,  subject  to the
           following:

           (1) If an individual (other than a former  Participant) is designated
               as a Participant  during a Plan Year,  any election for that Plan
               Year must be filed within 30 days after the date the  Participant
               received  the  notice  of  participation,   and  deferrals  shall
               commence as of the first day of the  calendar  quarter  after the
               election  is received by the  Committee.  Such an election  shall
               apply to Base  Salary  payable  during that Plan Year for payroll
               periods  beginning  on or after the first day of said quarter and
               to any incentive compensation for that Plan Year which is subject
               to a requirement  that the individual  remain  employed to a date
               that is on or after the first day of said quarter.

           (2) A former Participant who is again designated as a Participant may
               not commence deferrals until January 1 of the Plan Year following
               the  designation of  participation,  and an election to defer for
               such Plan Year must be made prior to said January 1.

           (3) Except as provided in paragraph (4),  elections for the Plan Year
               commencing July 1, 1998 must be filed by June 30, 1998.

           (4) Notwithstanding  anything  in  this  Plan to the  contrary,  if a
               Participant was a participant in the Prior PSCo Plan or the Prior
               SPS Plan on June 30, 1998, any

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               election in effect under such Prior Plan shall continue in effect
               for  purposes  of this  Plan for the 1998 Plan  Year,  and no new
               election shall be allowed under this Plan for that Plan Year. Any
               such election under a Prior Plan shall not apply to  Compensation
               with respect to Plan Years commencing after 1998.

     (b)  The  Participant  may elect to defer either (i) any whole  percent (in
          10% increments) of Compensation payable with respect to the Plan Year,
          or (ii) any percent or dollar amount of  Compensation up to the amount
          required for the  Participant  to receive the maximum  Company  Credit
          under Sec. 4.2. However,  the total deferrals during any Plan Year may
          not reduce the  Participant's  Compensation  payable  during that Plan
          Year (after  deduction of the deferrals  under this Plan) to less than
          $100,000 (or the dollar amount in effect for that Plan Year under Code
          Section 414(q)(1)(B), if greater).

     (c)  The deferred  compensation  credited under this section on behalf of a
          Participant  shall be  allocated  to the  Participant's  Cash  Account
          and/or  Directable Stock Account (as elected by the Participant) as of
          the date that the  Compensation  would otherwise have been paid to the
          Participant  in cash. The amount of Common Shares to be allocated to a
          Directable Stock Account shall be determined by dividing the credit by
          the average of the high and low sales  prices of a Common Share on the
          New York Stock  Exchange on the business day  proceeding  the date the
          credit is made.

      (d)  The Participant must file a separate  deferral election for each Plan
           Year with respect to which  deferrals are to be made under this Plan.
           An election for a Plan Year shall become irrevocable on the first day
           of that year,  subject to subsection  (e).  Elections  will not carry
           over  into  subsequent  Plan  Years.   However,  an  election  for  a
           particular Plan Year shall apply to all Compensation  with respect to
           that Plan Year,  including  incentive bonuses or other amounts earned
           during that year but paid in subsequent Plan Years.

      (e) Notwithstanding the foregoing provisions of this section:

           (1) All deferrals by a Participant shall cease as of (i) the date the
               Participant  receives a hardship  withdrawal  under any qualified
               defined   contribution   plan  subject  to  Code  Section  401(k)
               maintained by the Company or any of its affiliates which requires
               that  deferrals  be  suspended  for  a  certain  period  of  time
               following  such  withdrawal,  or (ii) the  date  the  Participant
               receives  a  withdrawal  from  this  Plan  for  severe  financial
               hardship  due  to an  unforeseeable  emergency  under  Sec.  5.5.
               Deferrals  under this section may not recommence  until the first
               day of the second Plan Year  beginning  after the date  deferrals
               ceased  under the  previous  sentence,  and no further  deferrals
               shall be made from  Compensation with respect to Plan Years prior
               to said second Plan Year.

           (2) The Committee may in its sole  discretion  cancel a Participant's
               deferral election for the current Plan Year (and for Compensation
               not yet paid with  respect to any  previous  Plan Years) upon the
               request of a  Participant  if the  Committee  determines  that an
               event has occurred which would make the Participant  eligible for
               a   withdrawal   for  severe   financial   hardship   due  to  an
               unforeseeable  emergency  under Sec.  5.5.  Deferrals  under this
               section may not recommence until the first day of the second Plan
               Year beginning after the date deferrals ceased under the previous
               sentence,   and  no   further   deferrals   shall  be  made  from
               Compensation with respect to

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               Plan Years prior to said second Plan Year.  The  Participant  may
               request that deferrals cease under this paragraph  whether or not
               the Participant requests a withdrawal under Sec. 5.5.

     Sec.  4.2  Company  Credits.  Subject to the  Committee's  discretion,  the
Nondirectable  Stock Account of each eligible  Participant  will be credited for
each Plan Year with a Company  Credit  representing  a number of Common  Shares,
determined as follows:

      (a)  The  Company  Credit  for a Plan  Year  will be equal  to the  amount
           determined  under  paragraph  (1) minus the amount  determined  under
           paragraph (2), with the result divided by the amount determined under
           paragraph  (3),  and with the result  then  rounded  to four  decimal
           places, as follows:

           (1) A dollar amount equal to 50% of the smaller of (i) the sum of the
               amount of Base Salary the  Participant  deferred  under this Plan
               for the Plan Year and the Participant's  pre-tax contributions to
               the  Savings  Plan  for  the  Plan  Year,  or  (ii)  8 %  of  the
               Participant's  "compensation" for the Plan Year recognized by the
               Savings Plan for purposes of determining  matching  contributions
               under that Plan (but  disregarding the limit on such compensation
               under Code Section 401(a)(17)); minus

           (2) The dollar amount of matching  contributions actually made to the
               Savings Plan for the Participant for the Plan Year; divided by

           (3) The average of the high and low sale prices of a Common  Share on
               the New York Stock  Exchange on the  business day  preceding  the
               date the matching contribution is made to the Savings Plan.

      (b)  Notwithstanding  subsection  (a),  a  Participant  will  receive  the
           Company Credit for a Plan Year only if the  Participant  participates
           in the Savings  Plan and makes the maximum  dollar  amount of pre-tax
           contribution permitted by the Savings Plan for that year.

      (c)  The Company Credit for an eligible  Participant  for a Plan Year will
           be allocated to the Participant's  Nondirectable Stock Account on the
           date the  matching  contribution  for such Plan Year is (or would be)
           made under the Savings Plan.

      (d)  Each Participant's Nondirectable Stock Account shall also be credited
           with any Common Shares  deferred under any annual  incentive plan, or
           other plan that may be established  by the Company,  for that portion
           of the award which is otherwise payable in Common Shares. Such credit
           shall  occur as of the date such  shares  would  otherwise  have been
           distributed to the Participant.

      (e)  Notwithstanding  the  foregoing,  the Company  Credits for the period
           from July I to  December  31, 1998 under this  Section  will be based
           only on compensation and contributions during that period.

     Sec. 4.3 Investment Credits and Valuation of Accounts. The Accounts of each
Participant  will be adjusted as of each  Valuation  Date to reflect  Investment
Credits,  deferrals  allocated to the Account  under Sec. 4. 1, Company  Credits
allocated under Sec. 4.2, credits to Stock Accounts

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under Sec. 4.4,  adjustments of Stock Accounts under Sec. 4.5, and distributions
from Accounts under Article V, since the previous Valuation Date, subject to the
following:

      (a)  Investment  Credits  on  each  Cash  Account  will  be  based  on the
           investment  index or indexes  selected by the  Participant to measure
           the  deemed  rate of  investment  return on his or her  Account.  The
           investment  indexes will be the same as the investment  options under
           the  Savings  Plan  (except  the NCE  Stock  Fund),  and  such  other
           investment  options as the Committee  makes available under this Plan
           from time to time.

      (b)  A Participant may file separate investment elections for the existing
           Cash  Account  balance  and for future  amounts to be credited to the
           Participant's  Cash Account  and/or  Directable  Stock  Account.  The
           Participant may also elect to have amounts transferred between his or
           her Cash Account and Directable  Stock Account.  The amount of Common
           Shares to be credited upon a transfer into a Directable Stock Account
           shall be determined as provided in Sec. 4. 1 (c).

      (c)  All investment  elections  shall be in accordance with such rules and
           regulations  as the Committee may  establish  from time to time.  The
           Committee may also  establish  such  procedures  for the valuation of
           Accounts as the  Committee  determines  in its sole  discretion  will
           reasonably  reflect the period of time amounts were  credited to each
           Account.

      (d)  Notwithstanding the foregoing,  the Committee may modify or disregard
           an  investment  election  filed by a  Participant  to the  extent the
           Committee determines that such action is necessary to comply with the
           terms  of this  Plan or to  avoid  adverse  tax  consequences  to the
           Participant or the Participating Employers.

      (e)  Notwithstanding   anything   in  the  Plan  to  the   contrary,   the
           Participating  Employers shall be under no obligation to purchase any
           investments  used for determining  Investment  Credits or to purchase
           Common  Shares.  The  investment  indexes and Common  Shares are used
           solely for the recordkeeping purpose of measuring gains and losses on
           each Participant's  Accounts,  and the Participant's Accounts are not
           actually being invested in the indexes or in Common Shares.

     Sec. 4.4 Dividends on Common  Shares.  Each  Participant's  Stock  Accounts
shall be credited as of each  dividend  payment date for Common Shares with that
number of shares obtained by dividing:

      (a)  the  amount of any  dividends  that would be payable on the number of
           shares  (including  fractional  shares,  carried out to four  decimal
           places)  credited to each Stock Account of such Participant as of the
           record date for payment of such dividend, by

      (b)  the  average of the high and low sale price of a Common  Share on the
           New  York  Stock  Exchange  on the  day  preceding  the  date of such
           dividend payment.

      See. 4.5 Adjustment of Stock Accounts for Splits,  Dividends,  Etc. In the
event of any change in the outstanding Common Shares of the Company by reason of
any share dividend or split, recapitalization,  merger, consolidation, spin-off,
reorganization,  combination  or  exchange  of Common  Shares  or other  similar
corporate change, the Committee shall make appropriate  adjustment in the number
of the Common Shares in the Participants' Stock Accounts.

                                       -8-


<PAGE>


                                    ARTICLE V

                            DISTRIBUTION OF ACCOUNTS

     Sec. 5.1 Time for Distribution. Except as provided in Sec. 5.5 and the last
paragraph of this Section,  all Account  balances  shall be  distributed  to the
Participant or Beneficiary within 30 days after the earliest to occur of:

      (a) The Participant's Retirement,

      (b) The  date the  Participant  is  determined  by the  Committee  to have
          incurred a Disability.

      (c) The date of the Participant's death.

      (d) Any  other  termination  of the  Participant's  employment  with  the
          Participating Employers.

However,  any Company  Credit for the final  partial Plan Year of  participation
shall  be  distributed  at  the  time  it  is  credited  to  the   Participant's
Nondirectable Stock Account.

     Sec. 5.2 Manner of Payment. The balance in a Participant's Cash Account and
the value of whole and  fractional  shares in the  Participant's  Stock Accounts
shall be paid in cash in a single lump sum payment.

      Sec.  5.3 Amount of  Payment.  The amount of cash to be  distributed  to a
Participant with respect to the Participant's  Cash Account shall be the balance
of such account as of the end of the month prior to the distribution. The amount
of cash to be  distributed  to a Participant  with respect to the  Participant's
Stock Accounts shall be the number of shares credited to such Accounts as of the
end of the month prior to the distribution multiplied by the average of the high
and low sales price of a Common Share on the New York Stock Exchange on the last
trading day of the month prior to the distribution.

      Sec. 5.4 Beneficiary Designation Each Participant shall have the right, at
any time, to designate any person or persons as Beneficiary or  Beneficiaries to
whom  payments  under this Plan shall be made in the event of the  Participant's
death prior to complete distribution of the amount credited to the Participant's
Accounts. Each Participant shall have the right to change his or her Beneficiary
designation at any time. Each  Beneficiary  designation  shall become  effective
only when filed in writing with the Committee during the Participant's life on a
form  prescribed  by the  Committee.  The  rights of each  Beneficiary  shall be
subject to the terms and  conditions  specified on the  designation  form to the
extent  consistent  with  the  terms  of the  Plan.  If a  Participant  fails to
designate a Beneficiary as provided  above,  or if all designated  Beneficiaries
predecease the  Participant,  then the  Beneficiary  shall be the  Participant's
estate.

     Sec. 5.5 Distributions for Severe Financial  Hardship.  Notwithstanding the
foregoing  sections of this Article V, the Committee in its sole  discretion may
approve a request  by a  Participant  for a  withdrawal  from the  Participant's
deferred amounts due to an unforeseeable emergency. An "unforeseeable emergency"
is severe  financial  hardship to the  Participant  resulting  from a sudden and
unexpected  illness or accident of the Participant or of a dependent (as defined
in Code Sec. 152(a) of the Participant,  loss of the Participant's  property due
to casualty, or other similar extraordinary and

                                       -9-


<PAGE>


unforeseeable  circumstances  caused  by an  event  beyond  the  control  of the
Participant.  Unforeseeable  emergencies specifically do not include the need to
pay for the education of a Participant's child or the desire to purchase a home.
Any such early  withdrawal  approved by the  Committee may not exceed the amount
reasonably  necessary  to meet  the  emergency.  Payment  may not be made to the
extent that such hardship is or may be relieved by any of the following means:

      (a)  Through reimbursement or compensation by insurance or otherwise.

      (b)  By  liquidation  of  the  Participant's  assets,  to the  extent  the
           liquidation  of such assets would not itself  cause severe  financial
           hardship.

      (c) By cessation of deferrals under the Plan.

     Sec. 5.6 Modification of Elections for Tax Considerations.  Notwithstanding
anything to the contrary in the  foregoing  sections of this Article V or in any
election filed by a Participant:

      (a)  If the  Committee  determines,  based on advice of legal counsel or a
           final  determination  by the Internal  Revenue  Service or a court of
           competent jurisdiction, that a Participant or Beneficiary may be held
           to be in  constructive  receipt  of  benefits  under  this  Plan  and
           required to recognize such benefit  immediately or retroactively  for
           income tax purposes,  the Committee may in its sole  discretion  take
           either of the following actions:

           (1) Distribute  the entire  affected  benefit in a single lump sum as
               soon as administratively feasible.

           (2) Take written action modifying the  Participant's  election and/or
               the terms of the Plan  (retroactively,  if necessary) in a manner
               that win eliminate the allegation of  constructive  receipt while
               at the same time carrying out the  Participant's  original intent
               to the extent possible.

      (b)  The Committee may postpone any payment to be made to a Participant or
           Beneficiary  until a  subsequent  fiscal  year  of the  Participating
           Employers to the extent the  Committee  determines to be necessary in
           order to avoid the loss of an income tax deduction under Code Section
           162(m).

      Sec. 5.7 Withholding and Taxes. The benefits payable under this Plan shall
be subject to the  deduction  of any  federal,  state,  or local income taxes or
other taxes which are required to be withheld  from such  payments by applicable
laws and  regulations.  Any Social  Security (FICA) taxes which must be withheld
prior to the distribution of benefits to the Participant  shall be withheld from
the  amounts  deferred,  or  from  the  Participant's  other  compensation,   as
determined by the Committee.  The Participating  Employers provide no assurances
or guarantees  regarding the tax treatment of amounts  deferred or payments made
under this Plan.  Each  Participant  is solely  responsible  for any  applicable
income, excise and other taxes,  penalties or interest (including any excise tax
under Code Section 4999).

                                      -10-


<PAGE>


                                   ARTICLE VI

                                 ADMINISTRATION

      Sec. 6.1  Administration by the Committee.  The Committee shall administer
the Plan, shall establish, adopt, or revise such rules and regulations as it may
deem necessary or advisable for the  administration  of the Plan, and shall have
discretionary   authority  to  interpret  the   provisions  of  the  Plan.   The
interpretations of the Committee shall be conclusive on all parties.

     Sec. 6.2 Claims  Procedure.  A Participant or Beneficiary  may make a claim
for Plan  benefits by filing a written  request  with the  Committee.  The claim
shall be  determined  by the  Committee  within 90 days after the receipt of the
written claim  (unless the Committee  extends the period for up to an additional
90 days).

      (a)  Notice  of the  Committee's  decision  shall be  communicated  to the
           claimant in writing. If the claim is denied, the notice shall include
           the specific reasons for the denial (including reference to pertinent
           Plan  provisions),  a  description  of  any  additional  material  or
           information  necessary for the Committee to reconsider the claim, the
           reasons for any of such additional  material or  information,  and an
           explanation of the review procedure.

     (b)  The claimant or a duly authorized  representative  may, within 60 days
          after  receiving  such  written  notice,  request in writing  that the
          Committee review its decision. The Committee may afford the claimant a
          hearing and shall afford the claimant  the  opportunity  to review all
          pertinent  documents  and  submit  issues  and  comments  orally or in
          writing.  The  Committee  shall  render a review  decision  in writing
          within 60 days  after  receipt  of  request  for  review  (unless  the
          Committee  extends the review period for up to an additional 60 days).
          The review  proceeding shall be conducted in accordance with the rules
          and regulations adopted from time to time by the Committee.

                                   ARTICLE VII

                            AMENDMENT AND TERMINATION

      Sec.  7.1  Amendment.  The Plan may be  amended in whole or in part at any
time for any reason by action of the  Board,  or by action of any person to whom
that authority has been delegated by the Board.  No amendment shall decrease the
benefits  under the Plan which have accrued prior to the date such  amendment is
adopted,  but may modify  future  Investment  Credits to  Accounts or the deemed
investments of Accounts in periods following the amendment.

      See. 7.2  Termination  of Plan. The Company,  by action of the Board,  may
terminate the Plan at any time. After such termination, no employee shall become
a Participant,  and no further amounts shall be credited pursuant to Sec. 4.1 or
Sec. 4.2 to Accounts of  Participants.  At the  discretion  of the Company,  the
amounts  credited to the Accounts of Participants  may be either (i) distributed
to  Participants  as of a date determined by the Company which is after the date
of  termination  based on  values  determined  as of the  last day of the  month
preceding the distribution, or (ii) distributed in accordance with Article V.

                                      -11-

<PAGE>


                                  ARTICLE VIII

                                  MISCELLANEOUS

      Sec. 8.1  Unsecured  Obligations.  A  Participant's  credits in his or her
Accounts shall be an unsecured obligation of the Participating  Employers to pay
the  Participant  (or  the  Participant's  Beneficiary,  in  the  event  of  the
Participant's  death) the actual amount of the credits at the time designated in
Article V. Each  Participant or  Beneficiary  is only a general  creditor of the
Participating  Employers  with  respect  to his or her  Accounts.  Accounts  are
maintained  for  recordkeeping  purposes  only.  Notwithstanding  the foregoing,
obligations  to pay benefits  under this Plan may be satisfied by  distributions
from a grantor  trust  created by the  Company in its sole  discretion  for such
purpose.  Each Participant  shall cooperate with the Committee and shall execute
any documents or submit to any physical  examination  reasonably required by the
Committee in connection with the administration of the Plan.

      Sec. 8.2 Benefits May Not Be Assigned or Alienated.  Neither a Participant
nor any Beneficiary shall have the right to sell, assign, transfer,  encumber or
otherwise  convey any right to receive  any  payment  hereunder.  No part of the
amounts payable  hereunder shall be subject to seizure or sequestration  for the
payment of any debts or judgments  owed by a  Participant  or any other  person.
However,  the Committee may offset the  obligations  to the  Participant  or the
Participant's  Beneficiary  hereunder by any amounts the Participant owes to the
Participating Employers,  provided that such amounts owed by the Participant are
not  related  in any way to the  benefits  payable  under this Plan and were not
incurred in  anticipation  of the benefits to which the  Participant  may become
entitled hereunder.

      Sec. 8.3  Incompetency.  Every person receiving or claiming benefits under
this Plan shall be conclusively presumed to be mentally competent until the date
on which the Committee receives a written notice in a form and manner acceptable
to  the  Committee  that  such  person  is  incompetent  and  that  a  guardian,
conservator  or other person  legally  vested with the care of his or her estate
has been appointed. In such event, the Committee may direct payments of benefits
to such  guardian,  conservator  or other person legally vested with the care of
the person's estate and any such payments so made shall be a complete  discharge
of the Participating Employers to the extent so made.

     Sec.  8.4  Notices.  Notices  required  by  this  Plan to be  given  to the
Committee or a  Participant  shall be in writing and shall be considered to have
been duly  given or  served if  personally  delivered,  or sent by first  class,
certified or registered mail.

     Sec. 8.5 Severability.  The invalidity or partial invalidity of any portion
of this Plan shall not  invalidate  the remainder  thereof,  and said  remainder
shall remain in full force and effect.

     Sec.  8.6  Headings.  Headings at the  beginning  of articles  and sections
hereof are for  convenience of reference,  shall not be considered a part of the
text of the Plan, and shall not influence its construction.

     Sec. 8.7 Capitalized Definitions . Capitalized terms used in the Plan shall
have their meaning as defined in the Plan unless the context  clearly  indicates
to the contrary.

     Sec.  8.8  Gender.  Any  references  to the  masculine  gender  include the
feminine and vice versa.

                                      -12-


<PAGE>


     Sec.  8.9 Use of  Compounds  of Word  "Here".  Use of the  words  "hereof",
"herein",  "hereunder".  or similar  compounds of the word "here" shall mean and
refer to the entire Plan unless the context clearly indicates to the contrary.

     Sec.  8.10 Construed  as a Whole.  The  provisions  of the Plan shall be
construed  as a whole in such manner as to carry out the  provisions  hereof and
shall not be construed separately without relation to the context.

      IN WITNESS WHEREOF, the Company has caused this Plan to be executed by its
duly authorized officer this 3rd day of August 1998.

                                                NEW CENTURY ENERGIES, INC.

                                                By:  /s/Bill D. Helton        
                                                     Its Chief Executive Officer


                                      -13-