SECURITIES AND EXCHANGE COMMISSION
                              WASHINGTON, DC 20549
                                    FORM 10-K
  (mark one)
  [ X ] Annual Report Pursuant to Section 13 or 15(d) of the Securities
        Exchange Act of 1934 for the fiscal year ended September 28, 1996

  [   ] Transition Report Pursuant to Section 13 or 15(d) of the Securities
        Exchange Act of 1934

                         Commission file number 1-13572

                            THERMO ECOTEK CORPORATION
             (Exact name of Registrant as specified in its charter)

  Delaware                                                           04-3072335
  (State or other jurisdiction of                              (I.R.S. Employer
  incorporation or organization)                            Identification No.)

  245 Winter Street
  Waltham, Massachusetts                                             02254-9046
  (Address of principal executive offices)                           (Zip Code)
       Registrant's telephone number, including area code: (617) 622-1500
           Securities registered pursuant to Section 12(b) of the Act:

         Title of each class           Name of exchange on which registered
     ----------------------------      ------------------------------------
     Common Stock, $.10 par value            American Stock Exchange

           Securities registered pursuant to Section 12(g) of the Act:
                                      None

  Indicate by check mark whether the Registrant (1) has filed all reports
  required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
  1934 during the preceding 12 months, and (2) has been subject to the filing
  requirements for at least the past 90 days. Yes [ X ] No [   ]

  Indicate by check mark if disclosure of delinquent filers pursuant to Item
  405 of Regulation S-K is not contained herein, and will not be contained, to
  the best of the Registrant's knowledge, in definitive proxy or information
  statements incorporated by reference into Part III of this Form 10-K or any
  amendment to this Form 10-K. [   ]

  The aggregate market value of the voting stock held by nonaffiliates of the
  Registrant as of November 22, 1996, was approximately $59,897,000.

  As of November 22, 1996, the Registrant had 24,424,499 shares of Common Stock
  outstanding.
                       DOCUMENTS INCORPORATED BY REFERENCE

  Portions of the Registrant's Annual Report to Shareholders for the fiscal
  year ended September 28, 1996, are incorporated by reference into Parts I and
  II.

  Portions of the Registrant's definitive Proxy Statement for the Annual
  Meeting of Shareholders to be held on March 13, 1997, are incorporated by
  reference into Part III.
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                                     PART I

    Item 1. Business

    (a)  General Development of Business

         Thermo Ecotek Corporation (the Company or the Registrant) is an
    environmental company providing a range of environmentally responsible
    technologies and products, including non-utility electric power
    generation using clean combustion processes, engineered clean fuels - as
    well as environmentally friendly pest control products through its
    biopesticides subsidiary, Thermo Trilogy Corporation (Thermo Trilogy).

         The Company operated as a division of Thermo Electron Corporation's
    (Thermo Electron's) Energy Systems Division (the Division) from 1979
    until its incorporation as Thermo Energy Systems Corporation in November
    1989. On January 2, 1990, Thermo Electron transferred certain of the
    assets and business of the Division to the Company in exchange for
    10,500,000 shares of common stock and the assumption by the Company of
    certain liabilities of the Division. In connection with this transfer,
    Thermo Electron agreed to indemnify the Company against any losses,
    costs, or damages incurred by the Company as a result of the conduct of
    the business of the Division prior to the transfer date. On January 2,
    1990, Thermo Electron and the Company signed an Agreement and Plan of
    Reorganization to recapitalize $10 million of loans made to the Company
    by Thermo Electron into 1,111,111 shares of redeemable convertible
    preferred stock. These shares were issued in May 1990 and were converted
    into 1,666,667 shares common stock during 1993 at a conversion price of
    $6.00 per share. In December 1994, the Company changed its name to Thermo
    Ecotek Corporation. The Company completed an initial public offering in
    February 1995. In March 1996, the Company issued and sold at par $37
    million principal amount of noninterest-bearing subordinated convertible
    debentures due 2001. The debentures are convertible into shares of the
    Company's common stock at a conversion price of $13.56 per share and are
    guaranteed on a subordinated basis by Thermo Electron. 

         Initially, the Division designed, developed, and acted as general
    contractor for the construction of cogeneration systems fueled by natural
    gas and diesel. These turnkey facilities were generally sold to third
    party operators upon completion and had a total generating capacity of
    approximately 60 megawatts. In the mid-1980s, the Division began
    developing biomass-fueled power plants to take advantage of a favorable
    regulatory environment and attractive power sales agreements. Biomass
    plants use environmentally responsible fuels including wood and
    agricultural wastes.

         The Company currently operates seven biomass facilities with a
    total electric generating capacity of 140 megawatts. The Company develops
    and operates its facilities through joint ventures or limited
    partnerships in which the Company has a majority interest, or through
    wholly owned subsidiaries (the Operating Companies).
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         In September 1996, the Company, through a wholly owned subsidiary,
    formed a joint venture with Marcegaglia Group of Mantova, Italy to
    develop, own, and operate biomass-fueled electric power facilities in
    that country.

         In January 1996, the Company, through a wholly owned subsidiary,
    signed a joint development agreement with a Czech/American power
    development company, EMD Praha Spol s.r.o. The initial focus will be on
    expansion and environmental retrofits of existing Czech energy centers.

         The Company is expanding beyond biomass power generation into other
    products and processes that protect the environment. In May 1996, two of
    the Company's wholly owned subsidiaries, acquired the net assets of the
    W.R. Grace & Co.'s biopesticide unit for approximately $8.1 million. In
    addition, the Company will pay a royalty fee of seven percent on annual
    sales of the acquired business in excess of $14 million through the year
    2000. Renamed Thermo Trilogy, the subsidiary develops, manufactures, and
    markets environmentally friendly products used for pest control. Derived
    from seeds of the tropical "neem" tree and pesticidal microbials isolated
    from nature, these biopesticides safely and effectively control insects,
    diseases, and mites on numerous crops. The state of California recently
    approved Trilogy(TM) 90EC, a neem oil-based miticide and fungicide, for
    use by California growers of fruits and vegetables. Thermo Trilogy's neem
    based products, Neemix(R) and Trilogy(TM) 90EC, are both approved for use
    on certified organic products.

         The Company has also entered into the field of engineered "clean"
    fuels, through a partnership agreement with KFx Inc. (KFx). In August
    1995, the Company, through two wholly owned subsidiaries, entered into a
    Limited Partnership Agreement with KFx Wyoming, Inc., a subsidiary of
    KFx. The Company is committed to provide approximately $48 million for
    the design, construction, and operation of the first full-scale coal
    production facility to use the patented K-Fuels "clean coal" technology.
    The Company will have a 95% equity interest in the plant. Once completed,
    the Gillette, Wyoming facility will transform high-moisture, low-energy
    coal into 500,000 tons per year of low-moisture, high-energy, solid fuel,
    using the Koppelman "C" process. KFx holds certain rights to this
    process, which produces coal known as K-Fuels for utility and industrial
    use. Construction began in August 1995, with commercial operation
    expected to commence in the first half of fiscal 1997.

         In August 1995, the Company purchased 1,500,000 shares of KFx
    common stock representing an approximate 7% equity interest in KFx. The
    cost of the purchase was $3,000,000. In fiscal 1996, the Company
    purchased an additional 1,500,000 shares of KFx common stock for  
    $3,000,000, bringing its total equity interest in KFx to approximately
    14%. The Company has the right, but not the obligation, to purchase an  
    additional 1,250,000 shares of common stock at $2.00 per share at certain
    times in fiscal 1997, if such shares are made available by KFx, as well
    as warrants, exercisable from January 1, 2000 through July 1, 2001, to
    purchase up to a total 51% equity interest in KFx. These warrants will
    terminate if the Company does not acquire all of the shares made
    available by KFx in 1997.
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         In July 1995, the Company entered into an agreement to invest $15
    million in a 185-megawatt combined cycle, steam-turbine electric
    generation facility located in Puerto Plata, Dominican Republic, owned by
    Smith/Enron Cogeneration Limited Partnership (SECLP). Under the terms of
    the agreement, the Company will acquire both a general and limited
    partnership interest in Smith Cogeneration Dominicana L.P. (Smith
    Cogeneration), which through its investment in SECLP, owns approximately
    50% of the project. The Company will receive a minority interest in Smith
    Cogeneration equivalent to a specified percentage of all project cash
    flow and profits and losses. The Company's exact percentage interest in
    Smith Cogeneration will not be finally determined until six months after
    the funding of the Company's investment, which is expected to occur
    during calendar 1997, assuming certain conditions are met.

         In June 1995, the Company changed its fiscal year end from the
    Saturday nearest December 31 to the Saturday nearest September 30.
    References to "fiscal 1996," "fiscal 1995," and "1994" herein are for the
    year ended September 28, 1996, the nine months ended September 30, 1995,
    and the year ended December 31, 1994, respectively.

         At September 28, 1996, Thermo Electron owned approximately 83% of
    the Company's outstanding common stock, giving Thermo Electron the power
    to elect all Directors of the Company. Thermo Electron is a world leader
    in environmental monitoring and analysis instruments, biomedical products
    such as heart-assist devices and mammography systems, papermaking and
    paper-recycling equipment, biomass electric power generation, and other
    specialized products and technologies. Thermo Electron also provides a
    range of services related to environmental quality. Thermo Electron
    intends for the foreseeable future to maintain at least 80% ownership of
    the Company, so that it may continue to file consolidated U.S. federal
    income tax returns with the Company. This will require the purchase by
    Thermo Electron of additional shares of the Company's common stock from
    time to time as the number of outstanding shares issued by the Company
    increases. These purchases may be made either on the open market or
    directly from the Company. During fiscal 1996, Thermo Electron purchased
    898,159 shares of the Company's common stock in the open market for a
    total price of $12,717,000. The Company has sold $68.5 million of
    subordinated convertible debentures to Thermo Electron that could be
    converted to maintain at least 80% ownership by Thermo Electron.

         Forward-looking Statements

         Forward-looking statements within the meaning of Section 21E of the
    Securities Exchange Act of 1934, are made throughout this Annual Report
    on Form 10-K. These statements involve a number of risks and
    uncertainties, including those detailed under the caption
    "Forward-looking Statements" in the Registrant's Fiscal 1996 Annual
    Report to Shareholders incorporated herein by reference.

    (b)  Financial Information About Industry Segments

         The Company currently operates in predominantly one business
    segment: the design, development, and operation of independent
    (non-utility) electric power generation facilities using a range of
    environmentally responsible combustion technologies. In addition, the
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    Company's newly formed Thermo Trilogy subsidiary is engaged in the
    development, manufacture, and marketing of biopesticides, and the Company
    has entered the field of engineered "clean" fuels through its partnership
    with KFx. Neither of these new business segments were significant to the
    Company's operations in fiscal 1996.

    (c)  Description of Business

         (i) Principal Products and Services

    Independent Power Production

    Operating Projects

         The following table summarizes certain information relating to the
    Company's projects currently in operation. With the exception of the
    Mendota plant, at the end of each leased facility's applicable lease
    term, the Company has the option to renew the lease for a specified
    period or purchase the facility at fair market value. The Mendota plant
    may be purchased for a fixed amount at the end of its lease term.

                                                 Ownership
                                         Plant       of       In-
                           Combustion    Size    Operating  service    Lease/
    Project     Location   Technology  (net mw)   Company     Date      Own
    -------------------------------------------------------------------------
                   New        Stoker                         December
    Hemphill    Hampshire     Fired       13.6       67%       1987     Lease

                              Stoker                         December
    Gorbell       Maine       Fired       13.6       80%       1987     Lease

                   New        Stoker                           July
    Whitefield  Hampshire     Fired       13.6      100%       1988      Own

                            Circulating
                             Fluidized                         May
    Mendota    California       Bed       25         60%       1990     Lease

                            Circulating
                             Fluidized                         May
    Woodland   California       Bed       25        100%       1990     Lease

                             Bubbling
                             Fluidized                       January
    Delano I   California       Bed       27        100%       1991      Own

                             Bubbling
                             Fluidized                       January
    Delano II  California      Bed        22        100%       1994       Own

         Hemphill. The Hemphill facility, a 13.6-megawatt, wood-waste plant,
    was completed in late 1987. It is located on a 50-acre site in
    Springfield, New Hampshire. The Operating Company is a joint venture in
    which the Company has a 67% interest. The Hemphill facility is owned by
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    BancBoston Leasing Services Inc., which leases the facility to the
    Operating Company through March 2003. Public Service of New Hampshire
    (PSNH) purchases power produced by the plant at a fixed rate under a rate
    order issued by the New Hampshire Public Utility Commission (NHPUC)
    expiring in 2006. The Operating Company purchases wood-waste pursuant to
    two contracts with affiliates of the Company's joint venture partner,
    each of which expires in 2003. The contracts provide for the supply of  
    wood-waste to the Operating Company at prescribed prices through 1997 and
    at market prices thereafter. In 1990, a plan of reorganization (the Plan)
    for PSNH was approved by the U.S. Bankruptcy Court for the District of
    New Hampshire. Pursuant to the Plan, Northeast Utilities (NU) acquired
    the assets of PSNH. An agreement between NU and the state of New
    Hampshire contains language to the effect that PSNH will seek to
    renegotiate some terms of certain rate orders directly with small power
    producers, and that the state will support PSNH in such efforts. PSNH has
    sought to renegotiate the rate orders applicable to the Company's
    facilities, and the state, acting through NHPUC, has supported such
    efforts. Based on negotiations between the two New Hampshire Operating
    Companies and PSNH during fiscal 1995, the Company believes that this
    matter may reach resolution in fiscal 1997, although final resolution is
    subject to approval of the NHPUC. Should the matter not reach resolution,
    the Company does not believe that PSNH has the right to take unilateral
    action to reduce the price of power purchased under the rate order. See
    "Management's Discussion and Analysis of Financial Condition and Results
    of Operations" incorporated by reference into Item 7 hereof.

         Gorbell. The Gorbell facility, a 13.6-megawatt wood-waste plant,
    was completed in late 1987. It is located on a 56-acre site in Athens,
    Maine. The design of the facility is substantially similar to the
    Hemphill plant. The Operating Company is a joint venture in which the
    Company has an 80% interest, which declines to 60% in 1998. The Gorbell
    facility is owned by BancBoston Leasing Services Inc., which leases the
    facility to the Operating Company through March 2003. Power produced by
    the plant is sold to Central Maine Power Company (CMP) through 2007 at a
    fixed price per kilowatt hour that is indexed annually to the rate of
    inflation. The Operating Company's fuel is purchased from an affiliate of
    the Company's joint venture partner pursuant to an agreement expiring in
    2002 under which the price escalates based upon a prescribed index.

         Whitefield. The Whitefield facility is a 13.6-megawatt wood-waste
    plant that has been in operation since 1988. It is located on a 46-acre
    site in Whitefield, New Hampshire. The power produced by the plant is
    sold to PSNH at established rates under a power sale agreement that
    expires in 2005. This plant is also subject to PSNH's attempt to
    renegotiate rate orders. See "Hemphill" above. Fuel is purchased pursuant
    to an agreement expiring in 1998 under which the price escalates based
    upon a prescribed index. The Whitefield facility was originally owned by
    Chrysler Capital Corp., and leased to the Operating Company. The Company
    purchased the Whitefield facility in August 1992. 

         Mendota. The Mendota facility is a 25-megawatt agricultural and
    urban wood-waste plant that has been in operation since 1990. It is
    located on an 80-acre site in Mendota, California. The Operating Company
    is a limited partnership, 60% of which is owned by the Company. The
    facility is owned by Chrysler Capital Corp., which leases the facility to
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    the Operating Company through 1999 at which point the Company will have
    an option to purchase the facility for $5 million. In June 1995, the
    Operating Company amended the facility lease which resulted in the
    agreement being treated as a capital lease. See "Management's Discussion
    and Analysis of Financial Condition and Results of Operations"
    incorporated by reference into Item 7 hereof. The power generated by the
    plant is sold to Pacific Gas & Electric (PG&E) under a standard offer #4
    (SO#4) contract expiring in 2014. Under the contract, PG&E is required to
    purchase the plant's electricity at predetermined prices until 2000, and
    at a price equal to PG&E's avoided-cost for the remainder of the
    contract. Payments for capacity are fixed. PG&E has asserted that the
    fixed rates under this contract will terminate mid-1999, however, the
    Company disputes this assertion. Approximately 45% of the fuel for the
    plant is purchased pursuant to long-term contracts terminating between
    1998 and 2002, under which prices increase in accordance with prescribed
    schedules or market-based indexes. The remainder of the plant's fuel is
    purchased by the Operating Company on the spot market.

         The power sale agreements between the Mendota and Woodland
    (discussed below) Operating Companies and PG&E allow PG&E to curtail the
    quantity of power purchased under these agreements by up to 1,000 hours
    of generating capacity annually at each plant. PG&E normally exercises
    its curtailment rights during periods when cheaper hydroelectric power is
    available, which generally occurs following periods of heavy rain or
    snow. Curtailment reduces the power payment received by the Operating
    Companies and, therefore, has an adverse effect on the financial results
    of those Operating Companies. The Company experienced approximately 930
    hours of utility imposed curtailments during fiscal 1996 at each plant.
    During November 1995, the Woodland and Mendota plants reached the
    contractual limit of 1,000 hours of curtailment for calendar 1995.

         Woodland. The Woodland facility is a 25-megawatt agricultural and
    urban wood-waste plant located on a 38-acre site in Woodland, California.
    The design of the plant is essentially the same as the Mendota plant. The
    Operating Company is a limited partnership in which the Company owns all
    of the equity. The facility is owned by BancBoston Leasing Services Inc.,
    which leases the facility to the Operating Company through March 2010.
    The electricity generated by the plant is sold to PG&E under an SO#4
    contract expiring in 2014, at predetermined prices until 2000. PG&E has
    asserted that the fixed rates under this contract will terminate
    mid-1999, however, the Company disputes this assertion. The price for the
    remainder of the contract is PG&E's avoided-cost. Payments for capacity
    are fixed. Approximately 20% of the fuel for the plant is purchased
    pursuant to long-term contracts terminating in 2000, under which prices
    increase in accordance with prescribed schedules or market based indexes.
    The remaining fuel is purchased by the Operating Company on the spot
    market.

         Beginning in 1996, the Operating Company has conditions in its
    nonrecourse lease agreement, that require the funding of a "power
    reserve" in years prior to 2000, based on projections of operating cash
    flow shortfalls in 2000 and thereafter. The power reserve represents
    funds available to make lease payments in the event that revenues are not
    sufficient after the plant converts to avoided-cost rates in March 2000.
    This funding requirement will significantly limit future profit
                                        7PAGE
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    distributions the Operating Company may make to the Company. Accordingly,
    beginning in the first quarter of fiscal 1997, the Company expects to
    expense the funding of reserves required under Woodland's nonrecourse
    lease agreement to cover projected shortfalls in lease payments beginning
    in 2000. As a result, the Company expects that the results of the
    Woodland plant will be reduced to approximately breakeven beginning in
    fiscal 1997, and thereafter. During fiscal 1996, the Woodland plant
    contributed $5.1 million of operating income.

         Delano I. The Delano I facility is a 27-megawatt agricultural and
    urban wood-waste plant located on a 124-acre site in Delano, California.
    Southern California Edison (SCE) purchases power under an SO#4 contract
    expiring in 2020, under which energy prices are predetermined until
    September 2000, and then at avoided-cost for the remainder of the
    contract. Approximately 60% of the fuel supply is purchased pursuant to
    long-term contracts with terms expiring from 1997 to 2004 under which
    prices increase in accordance with prescribed schedules or market based
    indexes. The remaining fuel is purchased by the Operating Company on the
    spot market. The Company has guaranteed to the Operating Company the
    price and availability of fuel that is not purchased pursuant to the
    long-term contracts. The Delano I facility was originally owned by
    Westinghouse Credit Corporation and leased to the Company. In December
    1993, the Company purchased Delano I for $21.5 million in cash and the
    assumption of $66.9 million of nonrecourse, long-term, tax-exempt bonds
    issued by the California Pollution Control Finance Authority (CPCFA).
    These bonds bear interest at a rate of 8.3%, with principal and interest
    payable semi-annually until maturity in 2000. The cash portion of the
    purchase price was funded by borrowings from Thermo Electron. 

         Delano II. In January 1994, the Delano Operating Company commenced
    operation of phase II of the Delano project, a 22-megawatt agricultural
    and urban wood-waste plant located on the same site as Delano I. The
    facility is wholly owned by the Delano Operating Company. Power generated
    by the Delano II facility is also purchased by SCE under the Delano I
    contract described above, under which prices are fixed until September
    2000. Fuel is also purchased pursuant to the same contracts as Delano I.
    The Delano II facility is owned by the Company and is subject to $66
    million principal amount of nonrecourse, long-term tax-exempt bonds
    issued by CPCFA. These bonds bear interest at a rate of 6%, with
    principal and interest payable semi-annually until maturity in 2000.

    Projects in Development

         Czech Republic

         In January 1996, the Company, through a wholly owned subsidiary,
    signed a joint development agreement with a Czech/American power
    development company, EMD Praha Spol s.r.o. The initial focus will be on
    expansion and environmental retrofit of existing Czech energy centers. To
    support this effort, the Company has opened an office in Prague. The
    projects are subject to a number of conditions including negotiation of
    definitive agreements for power sale, fuel supply, and other agreements
    with third parties. No assurance can be given that conditions or
    agreements will be satisfied on a timely basis. The Company does not
    believe that any of the projects will be operational before 1999.
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         Italy

         In September 1996, the Company, through a wholly owned subsidiary,
    formed a joint venture (the Joint Venture) with Marcegaglia Group of
    Mantova, Italy, to develop, own, and operate biomass-fueled electric
    power facilities in that country. The Joint Venture has begun preliminary
    evaluation of approximately 10 facilities, seven of which have already
    been approved by the Italian government's price subsidy program for
    biomass-fueled plants. In addition, several of the projects may qualify
    for European Union grants, covering a portion of the capital costs. The
    Joint Venture is currently establishing an office near Milan to
    coordinate the process of analyzing site locations as well as potential
    fuel sources and the appropriate technology choices for these facilities.
    The facilities are subject to a number of conditions including
    negotiation of definitive agreements for power sale, fuel supply, and
    other agreements with third parties. No assurance can be given that
    conditions or agreements will be satisfied on a timely basis. The Company
    does not expect that any of the projects will be operational before 1999.

         India

         Gouripore - The Company is in the initial stages of developing the
    Gouripore Thermal Power Station project, a 150-megawatt coal-fueled
    electricity generation plant using fluidized bed combustion to be located
    in Gouripore, West Bengal, India. The Gouripore project is one of the 70
    projects initially identified by the Indian government as part of a
    program to develop 70,000 additional megawatts of generating capacity by
    2002. The Company has entered into a memorandum of understanding with two
    India-based companies relating to the development of the project. The
    Company would be the majority owner of the project. To support this
    project, the Company has opened an office in Calcutta, from which it will
    evaluate other opportunities in India. The total financing requirement of
    the project is expected to be approximately $240 million, which is
    expected to involve significant equity investments and bank borrowings.

         The Company is in the process of negotiating a power sale agreement
    with the West Bengal State Electricity Board and is seeking a payment
    guarantee of the State Electricity Board's obligations from the West
    Bengal government, although there can be no assurance that such a
    guarantee will be obtained or that such a guarantee will be sufficient to
    obtain financing for the project. The project is subject to a number of
    conditions, including negotiation of definitive agreements with the
    Company's partners, as well as negotiation of power sale, fuel supply,
    and other agreements with third parties. No assurance can be given that
    these conditions will be satisfied on a timely basis, or at all.

         Bangalore - The Company is also in the initial stages of developing
    the IPS Power project, a 105-megawatt combined cycle, gas turbine
    electricity generation plant to be located near Mysore in the state of
    Karnataka, India. The Bangalore project is one of eight projects that
    received a state order allowing development of 500 additional megawatts
    of generating capacity. To support this project, the Company has opened
    an office in Bangalore. The total financing of the project is expected to
    be approximately $110 million, which is expected to involve significant
    equity investments and bank borrowings.
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         The Company is in the process of negotiating a power sale agreement
    with the Karnataka State Electricity Board and will be seeking a payment
    guarantee from the state government. The project is subject to a number
    of conditions including negotiation of definitive agreements for power
    sale, fuel supply, and other agreements with third parties. No assurance
    can be given that these conditions or agreements will be satisfied on a
    timely basis.

    Engineered Clean Fuels

         KFx, Fuel Partners, L.P. In August 1995, the Company, through two
    wholly owned subsidiaries, entered into a Limited Partnership Agreement
    with KFx Wyoming, Inc. (the Partnership) a subsidiary of KFx Inc., to
    develop, construct, and operate a subbituminous coal beneficiation plant
    to be constructed near Gillette, Wyoming. The Partnership has been
    granted, in exchange for certain future contingent royalty payments, a
    non-exclusive right and license to use certain patented clean coal
    technology (K-Fuel) to create a low-moisture, high-energy fuel with
    reduced sulfur that will help coal-burning utilities meet the SO2
    emission restrictions contained in the Clean Air Act. See "Regulatory
    Matters -- Domestic Energy Regulation." The Partnership has procured a
    24-acre site for construction of the plant and began construction in
    August 1995 under a third party, turnkey construction contract. The plant
    is expected to begin commercial operations in the first half of fiscal
    1997. In return for up to a 95% equity interest in the plant, the Company
    is committed to provide approximately $48 million for the design,
    construction, and operation of the plant. Costs to complete construction
    increased approximately $6.0 million primarily due to changes in certain
    portions of the construction project. During 1996, the U.S. government
    enacted legislation granting an 18-month extension of the Oil Barrel
    Equivalent tax credit for facilities producing alternative fuels, such as
    K-fuel. To be eligible, companies must enter into binding, written
    contracts for the construction of the facility, by December 31, 1996, and
    facilities must be in operation no later than July 31, 1998. In light of
    the new legislation, the Company has extended its construction schedule
    and is currently engaged in a feasibility study for the expansion of the
    production capacity of the facility under construction. The K-Fuel
    technology has not been tested on a large scale, and no assurance can be
    given that the plant, when constructed, will not experience technical
    problems or that the plant's production capacity will be expanded
    pursuant to the feasibility study.

         In August 1995, the Company purchased 1,500,000 shares of KFx Inc.
    common stock, representing an approximate 7% equity interest in the
    Company. The cost of the purchase was $3,000,000. In fiscal 1996, the
    Company purchased an additional 1,500,000 shares of KFx common stock for
    $3,000,000, bringing its total equity interest in KFx to approximately
    14%. The Company has the right, but not the obligation, to purchase an
    additional 1,250,000 shares of common stock at $2.00 per share in fiscal
    1997, if such shares are made available by KFx, as well as warrants,
    exercisable from January 1, 2000 through July 1, 2001, to purchase up to
    a total 51% equity interest in KFx. These warrants will terminate if the
    Company does not acquire all of the shares made available by KFx in 1997.
    See Note 3 of Notes to Consolidated Financial Statements in the
    Registrant's 1996 Annual Report to Shareholders incorporated by reference
    into Item 8 hereof.
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    Biopesticides

         In May 1996, the Company, through two of its wholly owned
    subsidiaries, acquired the net assets of a W.R. Grace & Co. business unit
    (renamed Thermo Trilogy) that develops, manufactures, and markets
    environmentally friendly products used for pest control, for
    approximately $8.1 million in cash. In addition, the Company will pay a
    royalty fee of seven percent on annual sales of the acquired business in
    excess of $14 million through the year 2000.

         Most of the biopesticide products produced by Thermo Trilogy are
    derived from the seed of tropical neem trees. Azadirachtin and neem oil,
    both extracts from neem seeds, are effective at controlling more than 200
    species of agricultural insects and diseases. The Company markets its
    neem-derived products under the trademarked names, "Trilogy," "Triact,"
    "Neemix," and "Neemazad."

         Resembling the structure of insect hormones, azadirachtin disrupts
    insects' molting process, significantly deterring feeding and egg laying.
    Azadirachtin products must be ingested to be effective. Only insects that
    feed on plant tissue succumb. Therefore, unlike most chemical pesticides,
    these botanical extracts leave beneficial insects unharmed. Neem
    oil-based products are also effective against fungi and various mites.

         The Company also markets a microbial product trademarked
    "SoilGard," a soil fungicide used to combat "damping off" disease in
    greenhouse ornamentals and vegetable seedlings, as well as PFR, an
    entomopathogentic fungus that paratizes and kills insects.

         The Company expects that it will need to educate growers regarding
    the effective use of biopesticides since using these naturally derived
    products requires pest management practices different from conventional
    chemical pesticides. Although response from growers to date has been
    positive, there is no assurance that the Company will be able to convince
    them to change their pest management practices. Additionally, until its
    acquisition of Thermo Trilogy, the Company had no experience in product
    marketing and merchandising. There is no assurance that the Company will
    be successful selling its biopesticide products to the agricultural
    market.

    Regulatory Matters

         The Company is subject to energy and environmental laws and
    regulations at the federal, state, local, and international levels in
    connection with the development, ownership, and operation of its plants.
    Federal laws and regulations govern power purchase and sale transactions
    with regulated utility companies, the types of fuel that may be used by a
    plant, the ownership of a plant, the plant's efficiency, and the type and
    use of combustion and pollution control technology at a plant. State
    utility regulatory commissions must establish the rates and, in some
    instances, other terms and conditions under which public utilities
    purchase electric power from non-utility generators. Under certain
    circumstances where specific exemptions are otherwise unavailable, state
    utility regulatory commissions may have broad jurisdiction over
                                       11PAGE
<PAGE>
    non-utility electric power plants. Energy-producing projects also are
    subject to federal, state, local, and international laws, as well as
    administrative regulations governing the emissions and other substances
    produced by a plant, and geographical location, zoning, and land use.

    Domestic Energy Regulation

         Public Utility Regulatory Policies Act of 1978, as amended (PURPA).
    The U.S. market for non-utility generators developed after the passage of
    PURPA. Prior to the passage of PURPA, regulated utilities were the
    primary producers of electric power. PURPA was passed in the wake of the
    energy crises of the 1970s as a means to increase energy efficiency and
    foster the development of alternative power generation technologies. The
    1978 enactment of PURPA and the adoption of regulations thereunder by the
    Federal Energy Regulatory Commission (FERC) provided incentives for the
    development of cogeneration and small power production facilities.

         A domestic electricity generating project must be a Qualifying
    Facility, or "QF", in order to take advantage of certain rate and
    regulatory incentives provided by PURPA. To qualify as a QF, a plant must
    be a cogeneration facility or small power producer (less than 80
    megawatts) that burns waste or alternative fuels, and an electric utility
    or its subsidiary must not own more than 50% of the economic interest in
    the plant. PURPA exempts QFs from the Public Utility Holding Company Act
    of 1935 (PUHCA), most provisions of the Federal Power Act (the FPA) and,
    except under certain limited circumstances, state laws concerning rate or
    financial regulation. Each of the plants that the Company currently owns
    and operates meets the requirements under PURPA necessary for QF status.

         PURPA provides two primary benefits to QFs. First, QFs are relieved
    of compliance with extensive federal, state, and local regulations that
    control the development, financial structure, and operation of any
    energy-producing plant and the prices and terms on which energy may be
    sold by the plant. Second, FERC's regulations promulgated under PURPA
    require that electric utilities purchase electricity generated by QFs, at
    a price based on the purchasing utility's full "avoided cost." This is
    defined as the incremental cost to an electric utility of electric energy
    or capacity that the utility would have to generate itself or purchase
    from another source if it did not have power available from the QF. FERC
    regulations also permit QFs and utilities to negotiate agreements for
    utility purchases of power at rates lower than the utility's avoided
    costs. While public utilities are not explicitly required by PURPA to
    enter into long-term contracts, PURPA helped to create a regulatory
    environment in which it has become common for long-term contracts to be
    negotiated. While all of the Company's existing projects have long-term
    power sale agreements at rates equal to or greater than the utilities'
    current avoided-costs, the current practice is for most power sale
    agreements to be awarded at a rate below avoided-cost, due to increasing
    competition for utility contracts. Moreover, whereas in the 1980s power
    sale agreements were often entered into as a result of negotiations
    between a non-utility generator and a utility, increasingly, these
    agreements are the subject of competitive bidding, which tends to lower
    the price that a non-utility generator may receive for power. Currently,
                                       12PAGE
<PAGE>
    the demand for the construction of cogeneration plants has significantly
    diminished in the U.S. therefore, the Company does not anticipate
    entering into any new construction projects of this type in the near
    future.

         The Company endeavors to design its projects, monitor its
    compliance with applicable regulations, and choose its customers in a
    manner that minimizes the risks of losing QF status for its projects.
    However, if one of the Company's plants should lose its status as a QF,
    the Operating Company would no longer be entitled to the exemptions from
    PUHCA unless the Operating Company qualified as an Exempt Wholesale
    Generator (EWG) under the National Energy Policy Act of 1992. See
    "National Energy Policy Act" below. If the Operating Company was unable
    to qualify as a QF, the facility could be subject to regulation as a
    public utility under the FPA and could result in the Company
    inadvertently becoming a public utility holding company by owning or
    controlling more than 10% of a facility that would no longer be exempt
    from PUHCA. A loss of QF status could result in defaults under the
    Operating Company leases, power sale agreements, and other contracts,
    which could have a material adverse effect on the Company.

         PUHCA. Under the PUHCA, any corporation, partnership, or other
    legal entity that owns or controls 10% or more of the outstanding voting
    securities of a "public utility company," or a company that is a "holding
    company" of a public utility company, is subject to registration with the
    Securities and Exchange Commission and regulation under PUHCA, unless
    eligible for an exemption. PURPA provides that companies that only own
    QFs are not public utility holding companies under PUHCA. A holding
    company of a public utility company that is subject to registration is
    required by PUHCA to limit its utility operations to a single integrated
    utility system and to divest any other operations not functionally
    related to the operation of that utility system. Approval by the
    Securities and Exchange Commission is required for nearly all important
    financial and business dealings of the holding company.

         FPA. The FPA grants FERC exclusive rate-making jurisdiction over
    wholesale sales of electricity in interstate commerce, including ongoing
    as well as initial rate jurisdiction, which enables FERC to revoke or
    modify previously approved rates. These rates may be based on a
    cost-of-service approach or may be determined through competitive bidding
    or negotiation, or, lastly, may be based on other criteria as long as the
    rates are "just and reasonable" and in the public interest. While QFs
    under PURPA are exempt from the rate-making and certain other provisions
    of the FPA, projects not qualifying for QF status would be subject to the
    FPA and to FERC rate-making jurisdiction which may limit their
    flexibility in negotiations with power purchasers.

         National Energy Policy Act. In 1992, Congress enacted comprehensive
    new energy policy legislation in its passage of the National Energy
    Policy Act. This law is primarily designed to foster competition in
    energy production and provide non-utility generators with competitive
    access to the transmission grid. To achieve these goals, the National
    Energy Policy Act amended PUHCA to create Exempt Wholesale Generators
    (EWGs), a new class of generating facility that is exempt from public
    utility regulation under PUHCA. An EWG is an entity determined by FERC to
                                       13PAGE
<PAGE>
    be exclusively engaged, directly or indirectly, in the business of owning
    and/or operating certain eligible facilities and selling energy
    wholesale. EWGs may own facilities of any size, use any fuel source, and
    may be owned by utilities or non-utilities. EWGs may not own transmission
    facilities or otherwise exert market control. The National Energy Policy
    Act also provides new authority to FERC to mandate that owners of
    electric transmission lines provide wheeling access to non-utility
    generators at just and reasonable rates. Previously limited, wheeling
    rights enhance the ability of non-utility generators to negotiate
    transmission access and encourage development of facilities whose most
    feasible siting lies outside the purchasing utility's service area. The
    Company believes that the National Energy Policy Act could benefit the
    Company by expanding its ability to own and operate facilities that do
    not qualify for QF status. However, this legislation may also result in
    increased competition by allowing utilities and others to develop such
    facilities without being subject to the constraints of PUHCA.

         State Regulation. State public utility commissions (PUCs) have
    broad authority to regulate the rates, expenses, financings, and power
    sale transactions of regulated electric utilities. Since a power sale
    agreement will become a part of a utility's expenses (and therefore will
    be reflected in its rates), sale agreements with non-utility generators
    typically fall under the regulatory purview of PUCs. Recognizing the
    competitive nature of the acquisition process, most PUCs will permit
    utilities to "pass through" expenses associated with an independent power
    contract to the utility's retail customers.

         Non-utility generators (including EWGs) that are not QFs under
    PURPA are considered to be public utilities in many states, and are
    subject to broad regulation by PUCs - ranging from the requirement of
    certificates of public convenience and necessity - to regulation of
    organizational, accounting, financial, and other corporate matters.
    Although FERC generally has exclusive jurisdiction over the rates charged
    by such a producer to its wholesale customers, PUCs have the ability, in
    practice, to influence the establishment of such rates by asserting
    jurisdiction over the purchasing utility's ability to pass through the
    resulting cost of the purchased power to its retail customers. In
    addition, states may assert jurisdiction over the siting and construction
    of facilities, and over the issuance of securities and the sale or other
    transfer of assets by these facilities.

         Certain states, including California, Michigan, New York,
    Massachusetts, New Hampshire, and Texas, are considering legislation that
    will remove many of the restrictions that currently limit the ability of
    non-utility generators to sell electrical power directly to industrial
    and commercial customers. The Company believes that the removal of these
    restrictions will result in a greater competition and greater
    opportunities to negotiate power sale agreements with industrial and
    commercial customers and may result in state PUC's attempting to reduce,
    or forcing the renegotiation of, fixed rates or contracts. Although the
    Company believes that the trend in the power market is toward
    deregulation, to date, only a few states have passed any such
    legislation, and there can be no assurance that any further similar
    legislation will ultimately be passed.
                                       14PAGE
<PAGE>
         EPA and Related State Regulation. No pesticide may be manufactured,
    used or sold without federal and state approvals. Such approvals, called
    registrations, must be obtained for each individual product formulation
    for use on specific pests for specific crops. Adding new uses, new pests,
    new crops or new formulations requires submission of additional
    applications or data for approval.

         The U.S. Environmental Protection Agency (EPA) regulates pesticides
    under the Federal Insecticide, Fungicide and Rodenticide Act and
    implementing EPA regulations. To obtain a pesticide registration from the
    EPA, the applicant must submit detailed and costly toxicological and
    environmental test results evaluating a pesticide's toxic and other
    impacts on plants, pests, mammals, humans and the environment. Initial
    product registrations can take many years to obtain, and an applicant may
    incur considerable additional delay and expense if the EPA requests
    further testing and data. To promote the development and use of
    biopesticides, the EPA has established special guidelines for their
    registration which are set out in subdivision M of the EPA's Pesticide
    Assessment Guidelines which generally require less time and expense than
    that required for synthetic pesticides.

         As a part of the pesticide registration process, the applicant must
    submit labeling data describing the chemical composition of the
    pesticide, concentrations, methods of application, pest and crop use and
    cautionary and warning statements to be put on all packaging of the
    pesticides. All pesticide packages must contain the approved label and no
    changes can be made to the label without EPA approval.

         Pesticide registrations must also be obtained from each state where
    the pesticide will be sold. Some states such as California, which
    represents an important market for the Company's products, have their own
    extensive testing and pesticide registration procedures and may impose
    additional restrictions on the use of the pesticide in such state beyond
    those imposed by the EPA regulations. Other states simply follow the EPA
    registration and labeling guidelines. The Company's products have
    received pesticide registrations in 48 states.

         Foreign countries may also require extensive testing and data
    submission before pesticides can be manufactured or sold in such foreign
    country. In many cases, foreign government regulations for submission of
    registration applications may be more extensive than EPA's regulations
    and foreign pesticide registration may be even more difficult to obtain
    than EPA approvals. Some of the Company's products are registered for
    sale in Sweden, Israel, Saudi Arabia, and Morocco.

         The Company's activities may also be subject to regulation under
    other state, federal and foreign government laws and regulations
    governing employee and public health and safety, environmental pollution,
    clean water, disposal of hazardous wastes, manufacture of chemicals,
    product liability, food and agriculture applications, and public
    disclosure of the use of chemicals.
                                       15PAGE
<PAGE>
         (ii) New Products

         Not applicable.

         (iii) Raw Materials

         Fuel and operating supplies purchased by the Company's independent
    power projects are either available from a number of different suppliers
    or from alternative sources that could be developed without a material
    adverse effect on the Company. To date, the Company has experienced no
    difficulties in obtaining these materials.

         (iv) Patents, Licenses, and Trademarks

         Not applicable.

         (v) Seasonal Influences

         The Company earns a disproportionately high share of its income in
    the months of May through October due to rate structures under the power
    sale agreements relating to its California plants, which provide strong
    incentives to operate during this period of high demand. Conversely, the
    Company historically has operated at a loss or at a marginal profit
    during its second fiscal quarter due to the rate structure under these
    agreements.

         (vi) Working Capital Requirements

         There are no special inventory requirements or credit terms
    extended to customers that would have a material adverse effect on the
    Company's working capital.

         (vii) Dependency on a Single Customer

         The Company derived 10% or more of its revenues during the past
    three years from its three most significant electric utility customers:
    PSNH, SCE, and PG&E. Revenues from these three customers as a percentage
    of total revenues were approximately 21%, 36%, and 36%, respectively, in
    fiscal 1996.

         (viii) Backlog

         Not applicable.

         (ix) Government Contracts

         Not applicable.

         (x) Competition

         The worldwide independent power market now consists of numerous
    companies, ranging from small startups to multinational industrial
    companies. In addition, a number of regulated utilities have created
    subsidiaries that compete as non-utility generators. Non-utility
    generators often specialize in market "niches," such as a specific
                                       16PAGE
<PAGE>
    technology or fuel (for example, gas-fired cogeneration,
    refuse-to-energy, hydropower, geothermal, wind, solar, wood, or coal) or
    a specific region of the country where they believe they have a market
    advantage. However, many non-utility generators, seek to develop projects
    powered by the best fuel available. Many companies in this market have
    substantially greater financial, technical, and operational resources
    than the Company. The Company competes primarily on the basis of project
    experience, technical expertise, capital resources, and power pricing.
    The market in which the Company's biopesticide business competes is
    highly competitive and subject to rapid technological change. Many of the
    Company's competitors are large chemical companies with greater
    financial, marketing, and technological resources than the Company. The
    Company's biopesticide business competes primarily based on performance
    and effectiveness, and also on price, ease of application, and
    environmental impact of use.

         (xi) Research and Development

         Not applicable.

         (xii) Environmental Protection Regulation

         The construction and operation of power projects are subject to
    extensive federal, state, and local laws and regulations adopted for the
    protection of health, safety, and the environment, and to regulate land
    use. The laws and regulations applicable to the Company primarily involve
    the discharge of emissions into the water and air, and the use of water,
    but can also include wetlands preservation, endangered species, waste
    disposal, and noise regulation. These laws and regulations in many cases
    require a lengthy and complex process of obtaining licenses, permits, and
    approvals from federal, state, and local agencies. If such laws and
    regulations are changed and the Company's facilities are not
    grandfathered, extensive modifications to project technologies and
    facilities could be required.

         In November 1990, comprehensive amendments to the Clean Air Act
    were enacted. The first major revisions to the Clean Air Act since 1977,
    the 1990 Amendments expand the scope of federal regulations and
    enforcement in several significant respects. In particular, provisions
    relating to nonattainment, air toxins, permitting, enforcement, and acid
    deposition may affect many power projects. Although the majority of these
    new provisions were implemented by 1993, the full scope of the new
    requirements remains uncertain pending implementation of new regulations
    by the United States Environmental Protection Agency. The Clean Air Act
    and the 1990 Amendments contain provisions that regulate the amount of
    sulfur dioxide and nitrous oxide that may be emitted by both new and
    existing projects. None of the Company's projects are expected to be
    affected by the acid rain provisions of the 1990 Amendments. However,
    many power generating facilities may have to take various repowering
    steps to comply with the 1990 Amendments.

         The Company does not believe that it will be required to make
    material capital expenditures to comply with existing environmental
    regulations.
                                       17PAGE
<PAGE>
         (xiii) Number of Employees

         As of September 28, 1996, the Company employed, directly and
    through its Operating Companies, a total of 252 employees. None of the
    employees of the Company or the Operating Companies is represented by a
    labor union, and the Company considers its relations with its employees
    to be good.

         (xiv) Marketing

         Not applicable.

    (d)  Financial Information about Exports by Domestic Operations and
         about Foreign Operations

         Not applicable.

    (e)  Executive Officers of the Registrant

                                    Present Title (Year First Became
         Name                  Age  Executive Officer)
         --------------------------------------------------------------

         Brian D. Holt         47   President and Chief Executive
                                      Officer (1994)
         John N. Hatsopoulos*  62   Vice President and Chief Financial
                                      Officer (1989)
         Parimal S. Patel      53   Executive Vice President, Project
                                      Finance (1989)
         Brian P. Chatlosh     37   Vice President, Business Development     
                                      (1996)
         Robert R. Fini        54   Vice President, Technical
                                      Services (1994)
         Floyd M. Gent         47   Vice President, Asset
                                      Management (1994)
         Randall W. Miselis    43   Vice President, Accounting and
                                      Administration (1996)
         Robert P. Nordstrom   54   Vice President, Business Development,
                                      Asia (1996)
         Paul F. Kelleher      54   Chief Accounting Officer (1989)

    * John N. Hatsopoulos and George N. Hatsopoulos, a director of the
      Company, are brothers.

         All of the Company's executive officers are elected annually by the
    Board of Directors and serve until their successors are elected and
    qualified. All executive officers, except Messrs. Holt, Chatlosh, Gent,
    Miselis, and Nordstrom have held comparable positions for at least five
    years either with the Company or Thermo Electron. Mr. Holt has been
    President and Chief Executive Officer of the Company since February 1994,
    and a Director since January 1995. For more than five years prior to that
    time, he was President and Chief Executive Officer of Pacific Generation
    Company, a financier, builder, owner, and operator of independent power
    facilities. Mr. Chatlosh has been Vice President, Business Development
    since January 1996 and has worked for the Company in various managerial
    capacities in business development since 1993. Prior to joining the
                                       18PAGE
<PAGE>
    Company, Mr. Chatlosh worked for Oxbow Power Corporation in various
    managerial capacities in project development from 1986 to 1992. Mr. Gent
    has been Vice President, Asset Management of the Company since September
    1994. For more than five years prior to that time, Mr. Gent held various
    positions, most recently as Executive Vice President, at KTI
    Environmental Group, a developer, owner, and operator of waste-to-energy
    plants. Mr. Miselis has been Vice President of Accounting and
    Administration since January 1996 and has worked for the Company in
    various accounting capacities since November 1988. Mr. Nordstrom has been
    Vice President of Business Development, Asia, since January 1996 and has
    worked for the Company in various managerial capacities within marketing,
    project development, and operations since 1984. Messrs. Hatsopoulos and
    Kelleher are full-time employees of Thermo Electron, but devote such time
    to the affairs of the Company as the Company's needs reasonably require.


    Item 2. Properties

         The Company's corporate headquarters are located in Waltham,
    Massachusetts and consist of approximately 15,000 square feet that are
    occupied pursuant to a lease expiring in 2003. The Company also leases
    office space in Columbia, Maryland; Calcutta, India; Bangalore, India;
    Prague, Czech Republic; and Roseville, California. The Company's other
    properties consist of the power plants described under "Operating
    Projects." The Company owns all of the land on which the plants are
    built. In addition, the Company's Thermo Trilogy subsidiary leases
    warehouse space in Fresno, California.

         The Company's California plants are located in areas where there is
    a risk of potentially significant earthquake activity. Projects that the
    Company develops in the future may also be located in areas, including
    India, where there is earthquake risk. The Company's earthquake insurance
    is not sufficient to cover all potential losses and there can be no
    assurance that such insurance will continue to be available on reasonable
    terms.


    Item 3. Legal Proceedings

         Not applicable.


    Item 4. Submission of Matters to a Vote of Security Holders

         Not applicable.



                                       19PAGE
<PAGE>
                                     PART II

    Item 5. Market for Registrant's Common Equity and Related Shareholder
            Matters

         Information concerning the market and market price for the
    Registrant's Common Stock, $.10 par value, and dividend policy is
    included under the sections labeled "Common Stock Market Information" and
    "Dividend Policy" in the Registrant's Fiscal 1996 Annual Report to
    Shareholders and is incorporated herein by reference.


    Item 6. Selected Financial Data

         The information required under this item is included under the
    sections labeled "Selected Financial Information" and "Dividend Policy"
    in the Registrant's Fiscal 1996 Annual Report to Shareholders and is
    incorporated herein by reference.


    Item 7. Management's Discussion and Analysis of Financial Condition and
            Results of Operations

         The information required under this item is included under the
    heading "Management's Discussion and Analysis of Financial Condition and
    Results of Operations" in the Registrant's Fiscal 1996 Annual Report to
    Shareholders and is incorporated herein by reference.


    Item 8. Financial Statements and Supplementary Data

         The Registrant's Consolidated Financial Statements and
    Supplementary Data are included in Registrant's Fiscal 1996 Annual Report
    to Shareholders and are incorporated herein by reference.


    Item 9. Changes in and Disagreements with Accountants on Accounting and
            Financial Disclosures

         Not applicable.



                                       20PAGE
<PAGE>
                                    PART III


    Item 10. Directors and Executive Officers of the Registrant

         The information concerning Directors required under this item is
    incorporated herein by reference from the material contained under
    "Election of Directors" in the Registrant's definitive proxy statement to
    be filed with the Securities and Exchange Commission pursuant to
    Regulation 14A, not later than 120 days after the close of the fiscal
    year. The information concerning delinquent filers pursuant to Item 405
    of Regulation S-K is incorporated herein by reference from the material
    contained under the heading "Section 16(a) Beneficial Ownership Reporting
    Compliance" in the Registrant's definitive proxy statement to be filed
    with the Securities and Exchange Commission pursuant to Regulation 14A,
    not later than 120 days after the close of the fiscal year.


    Item 11. Executive Compensation

         The information required under this item is incorporated herein by
    reference from the material contained under the caption "Executive
    Compensation" in the Registrant's definitive proxy statement to be filed
    with the Securities and Exchange Commission pursuant to Regulation 14A,
    not later than 120 days after the close of the fiscal year.


    Item 12. Security Ownership of Certain Beneficial Owners and Management

         The information required under this item is incorporated herein by
    reference from the material contained under the caption "Stock Ownership"
    in the Registrant's definitive proxy statement to be filed with the
    Securities and Exchange Commission pursuant to Regulation 14A, not later
    than 120 days after the close of the fiscal year.


    Item 13. Certain Relationships and Related Transactions

         The information required under this item is incorporated herein by
    reference from the material contained under the caption "Relationship
    with Affiliates" in the Registrant's definitive proxy statement to be
    filed with the Securities and Exchange Commission pursuant to Regulation
    14A, not later than 120 days after the close of the fiscal year.

                                       21PAGE
<PAGE>
                                     PART IV


    Item 14. Exhibits, Financial Statement Schedules, and Reports on Form 8-K

    (a), (d) Financial Statements and Schedule

             (1) The consolidated financial statements set forth in the list
                 below are filed as part of this Report.

             (2) The consolidated financial statement schedule set forth in
                 the list below is filed as part of this Report.

             (3) Exhibits filed herewith or incorporated herein by reference
                 are set forth in Item 14(c) below.

             List of Financial Statements and Schedule Referenced in this
             Item 14

             Information incorporated by reference from Exhibit 13 filed
             herewith:

                 Consolidated Statement of Income
                 Consolidated Balance Sheet
                 Consolidated Statement of Cash Flows
                 Consolidated Statement of Shareholders' Investment
                 Notes to Consolidated Financial Statements
                 Report of Independent Public Accountants

             Financial Statement Schedules filed herewith:

                 Schedule I:  Condensed Financial Information of the
                 Registrant

                 All other schedules are omitted because they are not
                 applicable or not required, or because the required
                 information is shown either in the financial statements or
                 in the notes thereto.

         (b) Reports on Form 8-K

             None.

         (c) Exhibits

             See Exhibit Index on the page immediately preceding exhibits.


                                       22PAGE
<PAGE>
                                   SIGNATURES

         Pursuant to the requirements of Section 13 or 15(d) of the
    Securities Exchange Act of 1934, the Registrant has duly caused this
    report to be signed by the undersigned, thereunto duly authorized.

    Date: December 5, 1996            THERMO ECOTEK CORPORATION

                                  By: Brian D. Holt
                                      ---------------------------------
                                      Brian D. Holt
                                      President and Chief Executive Officer

         Pursuant to the requirements of the Securities Exchange Act of
    1934, this report has been signed below by the following persons on
    behalf of the Registrant and in the capacities indicated, as of
    December 5, 1996.

          Signature                                  Title

    By: Brian D. Holt               President, Chief Executive Officer,
        -------------------------         and Director
        Brian D. Holt              


    By: John N. Hatsopoulos         Vice President, Chief Financial
        -------------------------         Officer, and Director
        John N. Hatsopoulos      


    By: Paul F. Kelleher            Chief Accounting Officer
        -------------------------
        Paul F. Kelleher


    By: Jerry P. Davis              Chairman of the Board and Director
        -------------------------
        Jerry P. Davis


    By: Dr. George N. Hatsopoulos   Director
        -------------------------
        Dr. George N. Hatsopoulos


    By: Frank Jungers               Director
        -------------------------
        Frank Jungers


    By: William A. Rainville        Director
        -------------------------
        William A. Rainville


    By:  Susan F. Tierney           Director
         ------------------------
         Susan F. Tierney
                                       23PAGE
<PAGE>
                    Report of Independent Public Accountants


    To the Shareholders and Board of Directors of Thermo Ecotek Corporation:

         We have audited, in accordance with generally accepted auditing
    standards, the consolidated financial statements included in Thermo
    Ecotek Corporation's Annual Report to Shareholders incorporated by
    reference in this Form 10-K, and have issued our report thereon dated
    November 1, 1996. Our audits were made for the purpose of forming an
    opinion on those statements taken as a whole. The schedule listed in Item
    14 on page 22 is the responsibility of the Company's management and is
    presented for the purposes of complying with the Securities and Exchange
    Commission's rules and is not part of the basic consolidated financial
    statements. This schedule has been subjected to the auditing procedures
    applied in the audits of the basic consolidated financial statements and,
    in our opinion, fairly states in all material respects the consolidated
    financial data required to be set forth therein in relation to the basic
    consolidated financial statements taken as a whole.



                                              Arthur Andersen LLP



    Boston, Massachusetts
    November 1, 1996













                                       24PAGE
<PAGE>
    SCHEDULE I

                            THERMO ECOTEK CORPORATION

                  Condensed Financial Information of Registrant
                          Unconsolidated Balance Sheet

                                                September 28,  September 30,
    (In thousands)                                       1996           1995
    ------------------------------------------------------------------------
    ASSETS
    Current Assets:
      Cash and cash equivalents                      $ 52,728       $ 39,591
      Accounts and notes receivable from
        subsidiaries                                    2,883          3,165
      Prepaid income taxes and prepaid expenses         2,082          2,611
      Current portion of note receivable and other
        current assets                                    965          1,887
                                                     --------       --------
                                                       58,658         47,254
                                                     --------       --------
    Investment in Subsidiaries (on the equity
      method)                                         196,135        144,071
                                                     --------       --------

    Office Equipment, at Cost                             340            369
    Less: Accumulated Depreciation                       (251)          (217)
                                                     --------       --------
                                                           89            152
                                                     --------       --------
    Long-term Available-for-sale Investments, at
      Quoted Market Value (amortized cost of
      $6,004 in fiscal 1996)                           20,254              -
                                                     --------       --------

    Deferred Debt Expense                                 807              -
                                                     --------       --------

    Note Receivable                                         -            900
                                                     --------       --------

    Due from Parent Company                            12,116         18,794
                                                     --------       --------

    Other Assets                                            -          3,000
                                                     --------       --------
                                                     $288,059       $214,171
                                                     ========       ========




                                       25PAGE
<PAGE>
    SCHEDULE I

                            THERMO ECOTEK CORPORATION

                  Condensed Financial Information of Registrant
                    Unconsolidated Balance Sheet (continued)

                                                September 28,  September 30,
    (In thousands)                                       1996           1995
    ------------------------------------------------------------------------
    LIABILITIES AND SHAREHOLDERS' INVESTMENT
    Current Liabilities:
      Accounts payable                               $    114       $     96
      Accrued expenses                                  5,750          9,047
      Due to parent company                             1,448            451
                                                     --------       --------
                                                        7,312          9,594
                                                     --------       --------
    Long-term Obligations:
      Noninterest-bearing subordinated
        convertible debentures                         31,727              -
      4% Subordinated convertible debentures, due
        to parent company                              68,500         68,500
                                                     --------       --------
                                                      100,227         68,500
                                                     --------       --------

    Deferred Income Taxes                              42,633         34,892
                                                     --------       --------

    Other Deferred Items                                8,200          8,200
                                                     --------       --------

    Shareholders' Investment:
      Common stock                                      1,617          1,551
      Capital in excess of par value                   74,740         64,188
      Retained earnings                                45,048         27,268
      Treasury stock                                     (481)           (22)
      Net unrealized gain on available-for-sale
        investments                                     8,763              -
                                                     --------       --------
                                                      129,687         92,985
                                                     --------       --------
                                                     $288,059       $214,171
                                                     ========       ========




                                       26PAGE
<PAGE>
SCHEDULE I

                            THERMO ECOTEK CORPORATION

                  Condensed Financial Information of Registrant
                       Statement of Unconsolidated Income


                                                      Nine
                                   Year Ended     Months Ended     Year Ended
                                  September 28,   September 30,   December 31,
(In thousands)                        1996            1995            1994
------------------------------------------------------------------------------
Revenues                            $     -          $     -         $     -
Equity in Earnings of Subsidiaries   34,148           23,329          23,954
                                    -------          -------         -------
                                     34,148           23,329          23,954
                                    -------          -------         -------
Operating Costs and Expenses:
  Cost of revenues                        -                -               -
  General and administrative
    expenses                          9,404            6,686           7,371
                                    -------          -------         -------
                                      9,404            6,686           7,371
                                    -------          -------         -------

Operating Income                     24,744           16,643          16,583
Interest Income (Expense), Net          307             (352)         (1,960)
                                    -------          -------         -------

Income Before Provision for
  Income Taxes                       25,051           16,291          14,623
Provision for Income Taxes            7,271            6,027           4,972
                                    -------          -------         -------
Net Income                          $17,780          $10,264         $ 9,651
                                    =======          =======         =======











                                       27PAGE
<PAGE>
SCHEDULE I
                            THERMO ECOTEK CORPORATION

                  Condensed Financial Information of Registrant
                     Statement of Unconsolidated Cash Flows
                                 (In thousands)

                                                      Nine
                                   Year Ended     Months Ended     Year Ended
                                  September 28,   September 30,   December 31,
(In thousands)                        1996            1995            1994
------------------------------------------------------------------------------
Operating Activities:
  Net income                        $ 17,780        $ 10,264        $  9,651
  Adjustments to reconcile net
    income to net cash used in
    operating activities:
      Depreciation and amortization      182              54              70
      Deferred income tax expense      3,086           3,987           7,396
      Equity in earnings of
        subsidiaries                 (34,148)        (23,329)        (23,954)
      Changes in current accounts:
        Accounts and notes
          receivable from
          subsidiaries                   282          (1,823)            596
        Other assets                   1,520           5,526           3,228
        Accounts payable                  18            (470)            303
        Accrued expenses                (804)          3,633          (2,351)
        Due (to) from parent
          company                      5,181             (91)        (13,283)
                                    --------        --------        --------
            Net cash used in
              operating activities    (6,903)         (2,249)        (18,344)
                                    --------        --------        --------

Investing Activities:
  Acquisition                         (8,088)              -               -
  Investment in KFx, Inc.             (3,004)         (2,030)              -
  Purchases of office equipment           (8)            (26)            (32)
  Distribution from (investment
    in) subsidiaries                  (9,828)          7,843          16,716
                                    --------        --------        --------
            Net cash provided by
              (used in) investing
              activities             (20,928)          5,787          16,684
                                    --------        --------        --------

Financing Activities:
  Net proceeds from issuance of
    subordinated convertible
    debentures                        35,942               -               -
  Net proceeds from issuance of
    Company common stock               5,026          27,575               -
                                    --------        --------        --------
            Net cash provided by
              financing activities    40,968          27,484               -
                                    --------        --------        --------

Increase (Decrease) in Cash and
  Cash Equivalents                    13,137          31,113          (1,660)
Cash and Cash Equivalents at
  Beginning of Period                 39,591           8,478          10,138
                                    --------        --------        --------
Cash and Cash Equivalents at
  End of Period                     $ 52,728        $ 39,591        $  8,478
                                    ========        ========        ========
                                       28PAGE
<PAGE>
                                  EXHIBIT INDEX


    Exhibit
    Number    Description of Exhibit                                        

      2       Asset Purchase Agreement among Thermo Trilogy Corporation,
              Thermo Ecotek International Holdings, Inc. and W.R. Grace
              & Co. - Conn. dated March 5, 1996 (filed as Exhibit 2 to
              the Registrant's Quarterly Report on Form 10-Q for the
              quarter ended March 30, 1996 [File No. 1-13572] and
              incorporated herein by reference).

      3.1     Certificate of Incorporation, as amended, of the
              Registrant (filed as Exhibit 3.1 to the Registrant's
              Registration Statement on Form S-1 [Reg. No. 33-86682] and
              incorporated herein by reference).

      3.2     By-Laws of the Registrant.

      4       Fiscal Agency Agreement dated as of March 14, 1996 among
              the Registrant, Thermo Electron Corporation, and Chemical
              Bank as fiscal agent, relating to $37 million principal
              amount of noninterest-bearing subordinated convertible
              debentures due 2001 (filed as Exhibit 4 to the
              Registrant's Quarterly Report on Form 10-Q for the quarter
              ended March 30, 1996 [File No. 1-13572] and incorporated
              herein by reference).

     10.1     Asset Transfer Agreement between Thermo Electron
              Corporation and the Registrant dated January 2, 1990
              (filed as Exhibit 10.1 to the Registrant's Registration
              Statement on Form S-1 [Reg. No. 33-86682] and incorporated
              herein by reference).

     10.2     Corporate Services Agreement dated January 3, 1993,
              between Thermo Electron Corporation and the Registrant
              (filed as Exhibit 10.2 to the Registrant's Registration
              Statement on Form S-1 [Reg. No. 33-86682] and incorporated
              herein by reference).

     10.3     Thermo Electron Corporate Charter as amended and restated
              effective January 3, 1993 (filed as Exhibit 10.3 to the
              Registrant's Registration Statement on Form S-1
              [Reg. No. 33-86682] and incorporated herein by reference).

     10.4     Amended and Restated Tax Allocation Agreement dated as of
              December 4, 1996 between Thermo Electron and the
              Registrant. 

     10.5     Master Repurchase Agreement dated January 1, 1994 between
              the Registrant and Thermo Electron Corporation (filed as
              Exhibit 10.5 to the Registrant's Registration Statement on
              Form S-1 [Reg. No. 33-86682] and incorporated herein by
              reference).

                                       29PAGE
<PAGE>
                                  EXHIBIT INDEX


    Exhibit
    Number    Description of Exhibit                                        

     10.6     Master Reimbursement Agreement dated as of January 1, 1994
              between Thermo Electron and the Registrant (filed as
              Exhibit 10.6 to the Registrant's Registration Statement on
              Form S-1 [Reg. No. 33-86682] and incorporated herein by
              reference).

     10.7     Lease Agreement dated as of December 2, 1991 between
              Thermo Electron and the Registrant (filed as Exhibit 10.7
              to the Registrant's Registration Statement on Form S-1
              [Reg. No. 33-86682] and incorporated herein by reference).

     10.8     Purchase and sale of $38,500,000 principal amount 4%
              subordinated convertible note due 2001 (filed as
              Exhibit 10.8 to the Registrant's Registration Statement on
              Form S-1 [Reg. No. 33-86682] and incorporated herein by
              reference).

     10.9     Purchase and sale of $30,000,000 principal amount 4%
              subordinated convertible note due 2001 (filed as
              Exhibit 10.9 to the Registrant's Registration Statement on
              Form S-1 [Reg. No. 33-86682] and incorporated herein by
              reference).

     10.10    Power Purchase Agreement between Mendota Biomass Power,
              Ltd. and Pacific Gas and Electric Company dated May 7,
              1984 (filed as Exhibit 10.10 to the Registrant's
              Registration Statement on Form S-1 [Reg. No. 33-86682] and
              incorporated herein by reference).

     10.11    Project Lease between Chrysler Capital Corporation and
              Mendota Biomass Power, Ltd. dated October 30, 1989 (filed
              as Exhibit 10.11 to the Registrant's Registration
              Statement on Form S-1 [Reg. No. 33-86682] and incorporated
              herein by reference).

     10.12    First Amendment to Project Lease between Chrysler Capital
              Corporation and Mendota Biomass Power, Ltd., dated June
              30, 1995 (filed as Exhibit 1 to the Registrant's Current
              Report on Form 8-K dated June 30, 1995 and incorporated
              herein by reference).

     10.13    Mendota Biomass Power, Ltd. Limited Partnership Agreement
              dated December 10, 1986 (filed as Exhibit 10.12 to the
              Registrant's Registration Statement on Form S-1
              [Reg. No. 33-86682] and incorporated herein by reference).

                                       30PAGE
<PAGE>
                                  EXHIBIT INDEX


    Exhibit
    Number    Description of Exhibit                                        

     10.14    Rate Order and Interconnection Agreement between
              Whitefield Power and Light Company and Public Service
              Company of New Hampshire dated September 4, 1986 (filed as
              Exhibit 10.13 to the Registrant's Registration Statement
              on Form S-1 [Reg. No. 33-86682] and incorporated herein by
              reference).

     10.15    Wood Supply Contract between North County Procurement,
              Inc. and Whitefield Power and Light Company dated June 4,
              1993 (filed as Exhibit 10.14 to the Registrant's
              Registration Statement on Form S-1 [Reg. No. 33-86682] and
              incorporated herein by reference).

     10.16    Leasing Agreement between BancBoston Leasing Services Inc.
              and Gorbell Thermo Electron Power Company dated December
              24, 1987 (filed as Exhibit 10.15 to the Registrant's
              Registration Statement on Form S-1 [Reg. No. 33-86682] and
              incorporated herein by reference). 10.17
              Amended and Restated Wood Supply Contract between
              Linkletter and Sons and Gorbell Thermo Electron Power
              Company dated January 15, 1993 (filed as Exhibit 10.16 to
              the Registrant's Registration Statement on Form S-1
              [Reg. No. 33-86682] and incorporated herein by reference).

     10.18    Power Purchase Agreement between Gorbell Thermo Electron
              Power Company and Central Maine Power Company dated
              February 3, 1984, as amended (filed as Exhibit 10.17 to
              the Registrant's Registration Statement on Form S-1
              [Reg. No. 33-86682] and incorporated herein by reference).

     10.19    Reduced Power Operation Agreement between Gorbell Thermo
              Electron Power Company and Central Maine Power Company
              dated January 14, 1994 (filed as Exhibit 10.18 to the
              Registrant's Registration Statement on Form S-1
              [Reg. No. 33-86682] and incorporated herein by reference).

     10.20    Joint Venture Agreement establishing Gorbell Thermo
              Electron Power Company dated September 13, 1985 (filed as
              Exhibit 10.19 to the Registrant's Registration Statement
              on Form S-1 [Reg. No. 33-86682] and incorporated herein by
              reference).

     10.21    Leasing Agreement between BancBoston Leasing Services,
              Inc. and Hemphill Power and Light Company dated December
              23, 1987 (filed as Exhibit 10.20 to the Registrant's
              Registration Statement on Form S-1 [Reg. No. 33-86682] and
              incorporated herein by reference).

                                       31PAGE
<PAGE>
                                  EXHIBIT INDEX


    Exhibit
    Number    Description of Exhibit                                        

     10.22    Rate Order Support Agreement between Hemphill Power and
              Light Company and Thermo Electron dated December 23, 1987
              (filed as Exhibit 10.21 to the Registrant's Registration
              Statement on Form S-1 [Reg. No. 33-86682] and incorporated
              herein by reference).

     10.23    Wood Supply Contract between Durgin & Crowell Lumber
              Company, Inc. and Hemphill Power and Light Company dated
              June 4, 1985 (filed as Exhibit 10.22 to the Registrant's
              Registration Statement on Form S-1 [Reg. No. 33-86682] and
              incorporated herein by reference).

     10.24    Fuel Supply Contract between Springfield Management
              Company and Hemphill Power and Light Company dated June 4,
              1985, as amended (filed as Exhibit 10.23 to the
              Registrant's Registration Statement on Form S-1
              [Reg. No. 33-86682] and incorporated herein by reference).

     10.25    Rate Order and Interconnection Agreement between Hemphill
              Power and Light Company and Public Service Company of New
              Hampshire dated June 26, 1986 (filed as Exhibit 10.24 to
              the Registrant's Registration Statement on Form S-1
              [Reg. No. 33-86682] and incorporated herein by reference).

     10.26    Joint Venture Agreement establishing Hemphill Power and
              Light Company dated June 4, 1985 (filed as Exhibit 10.25
              to the Registrant's Registration Statement on Form S-1
              [Reg. No. 33-86682] and incorporated herein by reference).

     10.27    Letter Agreement dated July 15, 1988 among the partners of
              Hemphill Power and Light Company amending various
              agreements (filed as Exhibit 10.26 to the Registrant's
              Registration Statement on Form S-1 [Reg. No. 33-86682] and
              incorporated herein by reference).

     10.28    Letter Agreement dated January 1, 1990 between the
              partners of Hemphill Power and Light Company (filed as
              Exhibit 10.27 to the Registrant's Registration Statement
              on Form S-1 [Reg. No. 33-86682] and incorporated herein by
              reference).

     10.29    Assignment and Assumption Agreement of Delano II plant by
              Delano Energy Company, Inc. dated December 1, 1993 (filed
              as Exhibit 10.28 to the Registrant's Registration
              Statement on Form S-1 [Reg. No. 33-86682] and incorporated
              herein by reference).
                                       32PAGE
<PAGE>
                                  EXHIBIT INDEX


    Exhibit
    Number    Description of Exhibit                                        

     10.30    Loan Agreement between California Pollution Control
              Financing Authority ("CPCFA") and Delano Energy Company,
              Inc. dated August 1, 1989, as supplemented on May 1, 1990
              (Delano I) (filed as Exhibit 10.29 to the Registrant's
              Registration Statement on Form S-1 [Reg. No. 33-86682] and
              incorporated herein by reference).

     10.31    Indenture of Trust between CPCFA and Bankers Trust Company
              dated August 1, 1990, as supplemented on May 1, 1990
              (Delano I) (filed as Exhibit 10.30 to the Registrant's
              Registration Statement on Form S-1 [Reg. No. 33-86682] and
              incorporated herein by reference).

     10.32    Indenture of Trust between CPCFA and Bankers Trust Company
              dated October, 1991 (Delano II) (filed as Exhibit 10.31 to
              the Registrant's Registration Statement on Form S-1
              [Reg. No. 33-86682] and incorporated herein by reference).

     10.33    Loan Agreement between CPCFA and Delano Energy Company,
              Inc. dated October 1, 1991 (filed as Exhibit 10.32 to the
              Registrant's Registration Statement on Form S-1
              [Reg. No. 33-86682] and incorporated herein by reference).

     10.34    Power Purchase Contract between Southern California Edison
              Co. and Signal Delano Energy Company, Inc. dated July 31,
              1987 (filed as Exhibit 10.33 to the Registrant's
              Registration Statement on Form S-1 [Reg. No. 33-86682] and
              incorporated herein by reference).

     10.35    Amended Restated Reimbursement Agreement among Chemical
              Trust Company of California ("CTCC"), Delano Energy
              Company, Inc. and ABN AMRO Bank N.V. and other banks dated
              December 31, 1993 (filed as Exhibit 10.34 to the
              Registrant's Registration Statement on Form S-1
              [Reg. No. 33-86682] and incorporated herein by reference).

     10.36    Amended and Restated Lease Agreement between CTCC and
              Delano Energy Company, Inc. dated December 31, 1993 (filed
              as Exhibit 10.35 to the Registrant's Registration
              Statement on Form S-1 [Reg. No. 33-86682] and incorporated
              herein by reference).

     10.37    Biomass Fuel Supply Contract between the Registrant and
              Delano Energy Company, Inc. dated December 31, 1993 (filed
              as Exhibit 10.36 to the Registrant's Registration
              Statement on Form S-1 [Reg. No. 33-86682] and incorporated
              herein by reference).

                                       33PAGE
<PAGE>
                                  EXHIBIT INDEX


    Exhibit
    Number    Description of Exhibit                                        

     10.38    Agreement between Consolidated Edison Company of New York,
              Inc. and Staten Island Cogeneration Corporation (filed as
              Exhibit 10.37 to the Registrant's Registration Statement
              on Form S-1 [Reg. No. 33-86682] and incorporated herein by
              reference).

     10.39    Power Purchase Agreement between Woodland Biomass Power,
              Ltd. and Pacific Gas & Electric Company dated May 7, 1987
              (filed as Exhibit 10.38 to the Registrant's Registration
              Statement on Form S-1 [Reg. No. 33-86682] and incorporated
              herein by reference).

     10.40    Stock Purchase Agreement dated as of August 18, 1995
              between the Registrant and KFx, Inc. (filed as Exhibit
              10.40 to the Registrant's Transition Report on Form 10-K
              for the nine months ended September 30, 1995 [File No.
              1-13572] and incorporated herein by reference). Pursuant
              to Item 601(b)(2) of Regulation S-K, schedules to this
              Agreement have been omitted. The Company hereby undertakes
              to furnish supplementally a copy of such schedules to the
              commission upon request.

     10.41    Stock Purchase Warrant issued by KFx, Inc. to the Company
              dated August 18, 1995 (filed as Exhibit 10.41 to the
              Registrant's Transition Report on Form 10-K for the nine
              months ended September 30, 1995 [File No. 1-13572] and
              incorporated herein by reference).

     10.42    Stock Purchase Warrant issued by KFx, Inc. to the Company
              dated August 18, 1995 (filed as Exhibit 10.42 to the
              Registrant's Transition Report on Form 10-K for the nine
              months ended September 30, 1995 [File No. 1-13572] and
              incorporated herein by reference).

     10.43    Limited Partnership Agreement of KFx Fuel Partners, L.P.
              dated as of August 18, 1995 (filed as Exhibit 10.43 to the
              Registrant's Transition Report on Form 10-K for the nine
              months ended September 30, 1995 [File No. 1-13572] and
              incorporated herein by reference). (Certain portions of
              this Exhibit have been omitted subject to an application
              for confidential treatment filed with the Commission
              pursuant to Rule 24b-2 under the Securities Exchange Act
              of 1934).
                                       34PAGE
<PAGE>
                                  EXHIBIT INDEX


    Exhibit
    Number    Description of Exhibit                                        

     10.44    Turnkey Design and Construction Agreement dated as of
              August 18, 1995 between KFx Fuel Partners, L.P. and Walsh
              Construction Company, a Division of Guy F. Atkinson
              Company (filed as Exhibit 10.44 to the Registrant's
              Transition Report on Form 10-K for the nine months ended
              September 30, 1995 [File No. 1-13572] and incorporated
              herein by reference). (Certain portions of this Exhibit
              have been omitted subject to an application for
              confidential treatment filed with the Commission pursuant
              to Rule 24b-2 under the Securities Exchange Act of 1934).

     10.45    Lease Agreement between Manufacturers Hanover Trust
              Company of California and Woodland Biomass Power, Ltd.
              dated December 29, 1989 (filed as Exhibit 10.39 to the
              Registrant's Registration Statement on Form S-1
              [Reg. No. 33-86682] and incorporated herein by reference).

     10.46    Incentive Stock Option Plan of the Registrant (filed as
              Exhibit 10.44 to the Registrant's Registration Statement
              on Form S-1 [Reg. No 33-86682] and incorporated herein by
              reference). (Maximum number of shares issuable in the
              aggregate under this plan and the Registrant's
              Nonqualified Stock Option Plan is 1,350,000 shares, after
              adjustment to reflect share increase approved in December
              1993 and 3-for-2 stock split effected in October 1996).

     10.47    Nonqualified Stock Option Plan of the Registrant (filed as
              Exhibit 10.45 to the Registrant's Registration Statement
              on Form S-1 [Reg. No. 33-86682] and incorporated herein by
              reference). (Maximum number of shares issuable in the
              aggregate under this plan and the Registrant's Incentive
              Stock Option Plan is 1,350,000 shares, after giving affect
              to share increase approved in December 1993 and 3-for-2
              stock split effected in October 1996).

     10.48    Equity Incentive Plan of the Registrant (filed as Exhibit
              10.40 to the Registrant's Registration Statement on Form
              S-1 (Reg. No. 33-86682) and incorporated herein by
              reference).

     10.49    Deferred Compensation Plan for Directors of the Registrant
              (filed as Exhibit 10.41 to the Registrant's Registration
              Statement on Form S-1 [Reg. No. 33-86682] and incorporated
              herein by reference).

     10.50    Amended and Restated Directors Stock Option Plan of the
              Registrant (filed as Exhibit 10.42 to the Registrant's
              Registration Statement on Form S-1 [Reg. No. 33-86682] and
              incorporated herein by reference).

                                       35PAGE
<PAGE>
                                  EXHIBIT INDEX


    Exhibit
    Number    Description of Exhibit                                        

     10.51    Thermo Ecotek Corporation - Thermo Trilogy Corporation
              Nonqualified Stock Option Plan.

     10.52    Thermo Trilogy Corporation Equity Incentive Plan.

     10.53    Form of Indemnification Agreement between the Registrant
              and its officers and directors (filed as Exhibit 10.43 to
              the Registrant's Registration Statement on Form S-1
              [Reg. No. 33-86682] and incorporated herein by reference).

              In addition to the stock-based compensation plans of the
              Registrant, the executive officers of the Registrant may
              be granted awards under stock-based compensation plans of
              Thermo Electron Corporation, for services rendered to the
              Registrant or such affiliated corporations. Such plans
              were filed as Exhibits 10.21 through 10.44 to the Annual
              Report on Form 10-K of Thermo Electron Corporation for the
              fiscal year ended December 30, 1995 [File No. 1-8002] and
              as Exhibit 10.19 to Trex Medical Corporation's Annual
              Report on Form 10-K for the fiscal year ended September
              28, 1996 [File No. 1-11827] and are incorporated herein by
              reference).

     10.54    Stock Holding Assistance Plan and Form of Promissory Note.

     11       Statement re: Computation of Earnings per Share.

     13       Annual Report to Shareholders for the fiscal year ended
              September 28, 1996 (only those portions incorporated
              herein by reference).

     21       Subsidiaries of the Registrant.

     23       Consent of Arthur Andersen LLP.

     27       Financial Data Schedule.