ATTACHMENT 2










                              SECOND COMPOSITE

                                  RESTATED

                                NEW ENGLAND

                              POWER POOL AGREEMENT










               (As amended through the Fifty-First Agreement
                  Amending New England Power Pool Agreement)





















TABLE OF CONTENTS

PART ONE INTRODUCTION
SECTION 1 DEFINITIONS
1.1  Adjusted Load
1.2  Adjusted Monthly Peak
1.3  Adjusted Net Interchange
1.3A Administrative Procedures
1.4  AGC Capability
1.5  AGC Entitlement
1.6  Agreement
1.7  Annual Transmission Revenue Requirements
1.8  Automatic Generation Control or AGC
1.8A Balloting Agent
1.9  Bid Price
1.10 Commission
1.11 Control Area
1.12 Curtailment
1.13 Direct Assignment Facilities
1.14 Dispatch Price
1.15 EHV PTF
1.16 Electrical Load
1.17 Eligible Customer
1.17A End User Participant
1.18 Energy
1.19 Energy Entitlement
1.20 Entitlement
1.21 Entity
1.22 Excepted Transaction
1.23 [Deleted.]
1.24 Facilities Study
1.25 Firm Contract
1.26 First Effective Date
1.27 Good Utility Practice
1.28 HQ Contracts
1.29 HQ Energy Banking Agreement
1.30 HQ Interconnection
1.31 HQ Interconnection Agreement
1.32 HQ Interconnection Capability Credit
1.33 HQ Interconnection Transfer Capability
1.34 HQ Net Interconnection Capability Credit
1.35 HQ Phase I Energy Contract
1.36 HQ Phase I Percentage
1.37 HQ Phase I Transfer Credit
1.38 HQ Phase II Firm Energy Contract
1.39 HQ Phase II Gross Transfer Responsibility
1.40 HQ Phase II Net Transfer Responsibility
1.41 HQ Phase II Percentage
1.42 HQ Phase II Transfer Credit
1.43 HQ Use Agreement
1.44 Installed Capability
1.45 Installed Capability Entitlement
1.46 Installed Capability Responsibility
1.47 Installed System Capability
1.48 Interchange Transactions
1.49 Internal Point-to-Point Service
1.50 Interruption
1.51 ISO
1.52 Kilowatt
1.52A Liaison Committee
1.53 Load
1.54 Local Network
1.55 Local Network Service
1.56 Lower Voltage PTF
1.57 Market Products
1.57A Market Rules
1.58 [Deleted.]
1.58A Markets Committee
1.59 Monthly Peak
1.60 NEPOOL
1.61 NEPOOL Control Area
1.62 NEPOOL Installed Capability
1.63 NEPOOL Installed Capability Responsibility
1.64 NEPOOL Objective Capability
1.64A NEPOOL Market
1.64B NEPOOL System Rules
1.64C NERC
1.65 New Unit
1.66 Non-Participant
1.66A NPCC
1.66B OASIS
1.67 Operable Capability
1.68 [Deleted]
1.69 [Deleted
1.70 [Deleted
1.71 Operating Reserve
1.72 Operating Reserve Entitlement
1.73 Other HQ Energy
1.74 Participant
1.74A Participants Committee
1.75 Pool-Planned Facility
1.76 Pool-Planned Unit
1.77 Power Year
1.78 Prior NEPOOL Agreement
1.79 Proxy Unit
1.80 PTF
1.80A Publicly Owned Entity
1.81 [Deleted.]
1.82 Regional Network Service
1.83 [Deleted.]
1.84 [Deleted.]
1.85 Related Person
1.85A Reliability Committee
1.85B Reliability Standards
1.85C Review Board
1.86 Scheduled Dispatch Period
1.87 Second Effective Date
1.87A Sector
1.88 Service Agreement
1.89 Summer Capability
1.90 Summer Period
1.91 System Contract
1.92 System Impact Study
1.93 System Operator
1.94 Target Availability Rate
1.95 Tariff
1.95A Tariff Committee
1.95B Technical Committees
1.96 Third Effective Date
1.97 Through or Out Service
1.98 Transition Period
1.99 Transmission Customer
1.99A Transmission Owner
1.99B Transmission Owners Committee
1.100 Transmission Provider
1.101 Unit Contract
1.102 [Deleted.]
1.103 Winter Capability
1.104 Winter Period
1.105 10-Minute Spinning Reserve
1.106 10-Minute Non-Spinning Reserve
1.107 30-Minute Operating Reserve
1.108 [Deleted.]
1.109 Modification of Certain Definitions When a Participant Purchases a
Portion of Its Requirements from Another Participant Pursuant to Firm Contract
SECTION 2 PURPOSE; EFFECTIVE DATES
2.1  Purpose
2.2  Effective Dates; Transitional Provisions
SECTION 3 MEMBERSHIP
3.1  Membership
3.2  Operations Outside the Control Area
3.3  Lack of Place of Business in New England
3.4  Obligation for Deferred Expenses
3.5  Financial Security
SECTION 4 STATUS OF PARTICIPANTS
4.1  Treatment of Certain Entities as Single Participant
4.2  Participants to Retain Separate Identities
SECTION 5 NEPOOL OBJECTIVES AND COOPERATION BY PARTICIPANTS
5.1  NEPOOL Objectives
5.2  Cooperation by Participants
PART TWO GOVERNANCE
SECTION 6 COMMITTEE ORGANIZATION AND VOTING
6.1  Principal Committees
6.2  Sector Representation
6.3  Appointment of Members and Alternates
6.4  Term of Members
6.5  Regular and Special Meetings
6.6  Notice of Meetings
6.7  Attendance
6.8  Quorum
6.9  Voting Definitions
6.10 Voting On Proposed Actions
6.11 Voting On Amendments
6.12 Designated Representatives and Proxies
6.13 Limits on Representatives
6.14 Adoption of Bylaws
6.15 Joint Meetings of Technical Committees
SECTION 7 PARTICIPANTS COMMITTEE
7.1  Officers
7.2  Adoption of Budgets
7.3  Establishing Reliability Standards
7.4  Appointment and Compensation of NEPOOL Personnel
7.5  Duties and Authority
7.6  Attendance of Participants at Committee Meeting
7.7  Appeal of Actions to Review Board
SECTION 8 RELIABILITY COMMITTEE
8.1  Officers
8.2  Notice to Members and Alternates of Participants Committee
8.3  Voting; Appeal of Actions
8.4  Responsibilities
8.5  Establishment of Subcommittees and Task Forces
8.6  Further Powers and Duties
SECTION 9 TARIFF COMMITTEE
9.1  Officers
9.2  Notice to Members and Alternates of Participants Committee
9.3  Voting; Appeal of Actions
9.4  Responsibilities
9.5  Establishment of Subcommittees and Task Forces
9.6  Further Powers and Duties
SECTION 10 MARKETS COMMITTEE
10.1 Officers
10.2 Notice to Members and Alternates of Participants Committee
10.3 Voting; Appeal of Actions
10.4 Responsibilities
10.5 Establishment of Subcommittees and Task Forces
10.6 Further Powers and Duties
10.7 Development of Rules Relating to Non-Participant Supply and
Demand-side Resources
SECTION 11 FURTHER RESTRUCTURING
SECTION 11A REVIEW BOARD
11A.1 Organization
11A.2 Composition
11A.3 Qualifications
11A.4 Term
11A.5 Meetings
11A.6 Bylaws
11A.7 Procedure on Appeal of Participant Committee Action or  Failure to Take
Action
11A.8 Effect of a Review Board Decision
SECTION 11B TRANSMISSION OWNERS COMMITTEE
11B.1     Organization
11B.2     Membership
11B.3     Appointment of Members and Alternates
11B.4     Term of Members
11B.5     Regular and Special Meetings
11B.6     Notice of Meetings
11B.7     Attendance
11B.8     Votes
11B.9     Appointment of Task Forces or Working Groups
11B.10 Officers
11B.11 Adoption of Bylaws
11B.12 Review of Committee Actions
SECTION 11C LIAISON COMMITTEE
11C.1     Organization; Duties
11C.2     Membership
11C.3     Regular and Special Meetings
11C.4     Notice of Meetings
11C.5     Attendance
11C.6     Officers
PART THREE MARKET PROVISIONS
SECTION 12 INSTALLED CAPABILITY OBLIGATIONS AND PAYMENTS
12.1 Obligations to Provide Installed Capability.
12.2 Computation of Installed Capability Responsibilities
12.3 [Deleted].
12.4 Bids to Furnish Installed Capability
12.5 Consequences of Deficiencies in Installed Capability Responsibility
12.6 [Deleted].
12.7 Payments to Participants Furnishing Installed Capability
SECTION 13 OPERATION, GENERATION, OTHER RESOURCES,AND INTERRUPTIBLE CONTRACTS
13.1 Maintenance and Operation in Accordance with Good Utility Practice
13.2 Central Dispatch
13.3 Maintenance and Repair
13.4 Objectives of Day-to-Day System Operation
13.5 Satellite Membership
SECTION 14 INTERCHANGE TRANSACTIONS
14.1 Obligation for Energy, Operating Reserve and Automatic Generation Control
14.2 Obligation to Bid or Schedule, and Right to Receive Energy,
Operating Reserve and Automatic Generation Control
14.3 Amount of Energy, Operating Reserve and Automatic Generation
Control Received or Furnished
14.4 Payments by Participants Receiving Energy Service, Operating
Reserve and Automatic Generatin Control
14.5 Payments to Participants Furnishing Energy Service, Operating Reserve, and
Automatic Generation Control
14.6 Energy Transactions with Non-Participants
14.7 Participant Purchases Pursuant to Firm Contracts and System
Contracts
14.8 Determination of Energy Clearing Price
14.9 Determination of Operating Reserve Clearing Price
14.10 Determination of AGC Clearing Price
14.11 Funds to or from which Payments are to be Made
14.12 Development of Rules Relating to Nuclear and Hydroelectric Generating
Facilities, Limited-Fuel Generating Facilities, and Interruptible Loads
14.13 Dispatch and Billing Rules During Energy Shortages
14.14 Congestion Uplift.
14.15 Additional Uplift Charges.
PART FOUR TRANSMISSION PROVISIONS
SECTION 15 OPERATION OF TRANSMISSION FACILITIES
15.1 Definition of PTF
15.2 Maintenance and Operation in Accordance with Good Utility Practice
15.3 Central Dispatch
15.4 Maintenance and Repair
15.5 Additions to or Upgrades of PTF
SECTION 16 SERVICE UNDER TARIFF
16.1 Effect of Tariff
16.2 Obligation to Provide Regional Service
16.3 Obligation to Provide Local Network Service
16.4 Transmission Service Availability
16.5 Transmission Information
16.6 Distribution of Transmission Revenues
SECTION 17 POOL-PLANNED UNIT SERVICE
17.1 Effective Period
17.2 Obligation to Provide Service
17.3 Rules for Determination of Facilities Covered by Particular
Transactions
17.4 Payments for Uses of EHV PTF During the Transition Period
17.5 Payments for Uses of Lower Voltage PTF
17.6 Use of Other Transmission Facilities by Participants
17.7 Limits on Individual Transmission Charges
SECTION 17 A TRANSMISSION OWNERS RESERVED RIGHTS
17A.1
17A.2
17A.3
17A.4
17A.5
17A.6
17A.7
17A.8
PART FIVE GENERAL
SECTION 18 GENERATION AND TRANSMISSION FACILITIES
18.1 Designation of Pool-Planned Facilities
18.2 Construction of Facilities
18.3 Protective Devices for Transmission Facilities and Automatic
Generation Control Equipment
18.4 Review of Participant's Proposed Plans
18.5 Participant to Avoid Adverse Effect
SECTION 19 EXPENSES
19.1 Annual Fee.
19.2 NEPOOL Expenses
19.3 Restructuring Costs
SECTION 20 INDEPENDENT SYSTEM OPERATOR
SECTION 21 MISCELLANEOUS PROVISIONS
21.1 Alternative Dispute Resolution
21.2 Payment of Pool Charges; Termination of Status as Participant
21.3 Assignment
21.4 Force Majeure
21.5 Waiver of Defaults
21.6 Other Contracts
21.7 Liability and Insurance
21.8 Records and Information
21.9 Consistency with NPCC and NERC Standards
21.10 Construction
21.11 Amendment
21.12 Termination
21.13 Notices to Participants, Committees, Committee Members, or the System
Operator
21.14 Severability and Renegotiation
21.15 No Third-Party Beneficiaries
21.16 Counterparts



     COMPOSITE RESTATED NEW ENGLAND POWER POOL AGREEMENT

THIS AGREEMENT dated as of the first day of September, 1971, as amended, was
entered into by the signatories thereto for the establishment by them of a bulk
power pool to be known as NEPOOL and is restated by an amendment dated as of
May 7, 1999.

In consideration of the mutual agreements and undertakings herein, the
signatories hereby agree as follows:


PART ONE

INTRODUCTION

SECT65535ON 1

DEFINITIONS

Whenever used in this Agreement, in either the singular or plural number, the
following terms shall have the following respective meanings (an asterisk (*)
indicates that the definition may be modified in certain cases pursuant to
Section 1.109):

1.1  Adjusted Load * (not less than zero) of a Participant during any
particular hour is the Participant's Load during such hour less any Kilowatts
received (or Kilowatts which would have been received except for the
application of Section 14.7(b)) by such Participant pursuant to a Firm
Contract.

1.2  Adjusted Monthly Peak of a Participant for a month is its Monthly Peak,
provided that if there has been a transfer between Participants, in whole or
part, of the responsibilities under this Agreement during such month pursuant
to a Firm Contract, the Adjusted Monthly Peak of each such Participant shall
reflect the effect of such transaction, but the Adjusted Monthly Peak of a
Participant shall not be changed from the Monthly Peak to reflect the effect of
any other transaction.

1.3  Adjusted Net Interchange of a Participant for an hour is (a) the Kilowatts
produced by or delivered to the Participant from its Energy Entitlements or
pursuant to arrangements entered into under Section 14.6, as adjusted in
accordance with uniform market operation rules approved by the Markets
Committee to take account of associated electrical losses, as appropriate,
minus (b) the sum of (i) the Electrical Load of the Participant for the hour,
and (ii) the kilowatthours delivered by such Participant to other Participants
pursuant to Firm Contracts or System Contracts, in accordance with the
treatment agreed to pursuant to Section 14.7(a), together with any associated
electrical losses.

1.3A Administrative Procedures are procedures adopted by the System Operator
in order to fulfill its responsibilities to apply and implement NEPOOL  System
Rules.

1.4  AGC Capability of an electric generating unit or combination of units is
the maximum dependable ability of the unit or units to increase or  decrease
the level of output within a time frame specified by market  operation rules
approved by the Markets Committee, in response to a  remote direction from the
System Operator in order to maintain currently  proper power flows into and out
of the NEPOOL Control Area and to  control frequency.

1.5  AGC Entitlement is (a) the right to all or a portion of the AGC
Capability of a generating unit or combination of units to which an  Entity is
entitled as an owner (either sole or in common) or as a  purchaser, reduced by
(b) any portion thereof which such Entity is  selling pursuant to a Unit
Contract, and (c) further reduced or  increased, as appropriate, to recognize
rights to receive or obligations  to supply AGC pursuant to Firm Contracts or
System Contracts in  accordance with Section 14.7(a).  An AGC Entitlement in a
generating  unit or units may, but need not, be combined with any other
Entitlements  relating to such generating unit or units and may be transferred
separately from the related Installed Capability Entitlement, Energy
Entitlement, or Operating Reserve Entitlements.

1.6  Agreement is this restated contract and attachments, including the
Tariff, as amended and restated from time to time.

1.7  Annual Transmission Revenue Requirements of a Participant's PTF or of  all
Participants' PTF for purposes of this Agreement are the amounts  determined in
accordance with Attachment F to the Tariff.

1.8  Automatic Generation Control or AGC is a measure of the ability of a
generating unit or portion thereof to respond automatically within a  specified
time to a remote direction from the System Operator to  increase or decrease
the level of output in order to control frequency  and to maintain currently
proper power flows into and out of the NEPOOL  Control Area.

1.8A Balloting Agent is the Secretary of the Participants Committee.

1.9  Bid Price is the amount which a Participant offers to accept, in a  notice
furnished to the System Operator by it or on its behalf in  accordance with the
market operation rules approved by the Markets  Committee, as compensation for
(i) furnishing Installed Capability to  other Participants pursuant to this
Agreement, or (ii) preparing the  start up or starting up or increasing the
level of operation of, and  thereafter operating, a generating unit or units to
provide Energy to  other Participants pursuant to this Agreement, or (iii)
having a unit or  units available to provide Operating Reserve to other
Participants  pursuant to this Agreement, or (iv) having a unit or units
available to  provide AGC to other Participants pursuant to this Agreement, or
(v)  providing to other Participants Installed Capability, Energy, Operating
Reserve and/or AGC pursuant to a Firm Contract or System Contract in
accordance with Section 14.7.

1.10 Commission is the Federal Energy Regulatory Commission.

1.11 Control Area is an electric power system or combination of electric  power
systems to which a common automatic generation control scheme is  applied in
order to:

(l)  match, at all times, the power output of the generators within the
electric power system(s) and capacity and energy purchased from  entities
outside the electric power system(s), with the load within  the electric power
system(s);

(2)  maintain scheduled interchange with other Control Areas, within the
limits of Good Utility Practice;

(3)  maintain the frequency of the electric power system(s) within  reasonable
limits in accordance with Good Utility Practice and the  criteria of the
applicable regional reliability council or the  NERC; and

(4)  provide sufficient generating capacity to maintain operating  reserves in
accordance with Good Utility Practice.

1.12 Curtailment is a reduction in firm or non-firm transmission service in
response to a transmission capacity shortage as a result of system  reliability
conditions.

1.13 Direct Assignment Facilities are facilities or portions of facilities
that are Non-PTF and are constructed for the sole use/benefit of a  particular
Transmission Customer requesting service under the Tariff or  Generator Owner
requesting an interconnection.  Direct Assignment  Facilities shall be
specified in a separate agreement with the  Transmission Provider whose
transmission system is to be modified to  include and/or interconnect with said
Facilities, shall be subject to  applicable Commission requirements and shall
be paid for by the  Transmission Customer or a Generator Owner in accordance
with the  separate agreement and not under the Tariff.

1.14 Dispatch Price of a generating unit or combination of units, or a Firm
Contract or System Contract permitted to be bid to supply Energy in  accordance
with Section 14.7(b), is the price to provide Energy from the  unit or units or
Contract, as determined pursuant to market operation  rules approved by the
Markets Committee to incorporate the Bid Price for  such Energy and any loss
adjustments, if and as appropriate under such  market operation rules.

1.15 EHV PTF are PTF transmission lines which are operated at 230 kV or above
and related PTF facilities, including transformers which link other EHV  PTF
facilities, but do not include transformers which step down from 230  kV or a
higher voltage to a voltage below 230 kV.

1.16 Electrical Load (in Kilowatts) of a Participant during any particular
hour is the total during such hour (eliminating any distortion arising  out of
(i) Interchange Transactions, or (ii) transactions across the  system of such
Participant, or (iii) deliveries between Entities  constituting a single
Participant, or (iv) other electrical losses, if  and as appropriate), of

(a)  kilowatthours provided by such Participant to its retail customers  for
consumption, plus

(b)  kilowatthours of use by such Participant, plus

(c)  kilowatthours of electrical losses and unaccounted for use by the
Participant on its system, plus

(d)  kilowatthours used by such Participant for pumping Energy for its
Entitlements in pumped storage hydroelectric generating facilities,  plus

(e)  kilowatthours delivered by such Participant to Non-Participants.  The
Electrical Load of a Participant may be calculated in any reasonable  manner
which substantially complies with this definition.

1.17 Eligible Customer is the following:  (i) Any Participant that is  engaged,
or proposes to engage, in the wholesale or retail electric  power business is
an Eligible Customer under the Tariff.  (ii) Any  electric utility (including
any power marketer), Federal power marketing  agency, or any other entity
generating electric energy for sale or for  resale is an Eligible Customer
under the Tariff.  Electric energy sold  or produced by such entity may be
electric energy produced in the United  States, Canada or Mexico.  However,
with respect to transmission service  that the Commission is prohibited from
ordering by Section 212(h) of the  Federal Power Act, such entity is eligible
only if the service is  provided pursuant to a state requirement that the
Transmission Provider  with which that entity is directly interconnected offer
the unbundled  transmission service, or pursuant to a voluntary offer of such
service  by the Transmission Provider with which that entity is directly
interconnected.  (iii) Any end user taking or eligible to take unbundled
transmission service pursuant to a state requirement that the  Transmission
Provider with which that end user is directly  interconnected offer the
transmission service, or pursuant to a  voluntary offer of such service by the
Transmission Provider with which  that end user is directly interconnected, is
an Eligible Customer under  the Tariff.

1.17A     End User Participant is a Participant which is a consumer of
electricity in the NEPOOL Control Area that generates or purchases  electricity
primarily for its own consumption or a non-profit group  representing such
consumers.

1.18 Energy is power produced in the form of electricity, measured in
kilowatthours or megawatthours.

1.19 Energy Entitlement is (i) a right to receive Energy under a System
Contract or a Firm Contract in accordance with Section 14.7(a), or (ii)  a
right to receive all or a portion of the electric output of a  generating unit
or units to which an Entity is entitled as an owner  (either sole or in common)
or as a purchaser pursuant to a Unit  Contract, reduced by (iii) any portion
thereof which such Entity is  selling pursuant to a Unit Contract.  An Energy
Entitlement in a  generating unit or units may, but need not, be combined with
any other  Entitlements relating to such generating unit or units and may be
transferred separately from the related Installed Capability  Entitlement,
Operating Reserve Entitlements, or AGC Entitlement.

1.20 Entitlement is an Installed Capability Entitlement, Energy Entitlement,
Operating Reserve Entitlement, or AGC Entitlement.  When used in the  plural
form, it may be any or all such Entitlements or combinations  thereof, as the
context requires.

1.21 Entity is any person or organization whether the United States of  America
or Canada or a state or province or a political subdivision  thereof or a duly
established agency of any of them, a private  corporation, a partnership, an
individual, an electric cooperative or  any other person or organization
recognized in law as capable of owning  property and contracting with respect
thereto that is either:

(a)  engaged in the electric power business (the generation and/or
transmission and/or distribution of electricity for consumption by  the public
or the purchase, as a principal or broker, of Installed  Capability, Energy,
Operating Reserve, and/or AGC for resale); or

(b)  a consumer of electricity in the NEPOOL Control Area that  generates or
purchases electricity primarily for its own  consumption or a non-profit group
representing such consumers.

1.22 Excepted Transaction is a transaction specified in Section 25 of the
Tariff for the applicable period specified in that Section, or in  Sections 25A
and 25B of the Tariff.

1.23 [Deleted.]

1.24 Facilities Study is an engineering study conducted pursuant to this
Agreement or the Tariff by the System Operator and/or one or more affected
Participants to determine the required modifications to the NEPOOL Transmission
System, including the cost and scheduled completion  date for such
modifications, that will be required to provide a  requested transmission
service or interconnection.

1.25 Firm Contract is any contract, other than a Unit Contract, for the
purchase of Installed Capability, Energy, Operating Reserves, and/or  AGC,
pursuant to which the purchaser's right to receive such Installed  Capability,
Energy, Operating Reserves, and/or AGC is subject only to  the supplier's
inability to make deliveries thereunder as the result of  events beyond the
supplier's reasonable control.

1.26 First Effective Date is March 1, 1997.

1.27 Good Utility Practice shall mean any of the practices, methods, and acts
engaged in or approved by a significant portion of the electric utility
industry during the relevant time period, or any of the practices, methods, and
acts which, in the exercise of reasonable judgement in  light of the facts
known at the time the decision was made, could have  been expected to
accomplish the desired result at a reasonable cost  consistent with good
business practices, reliability, safety and  expedition.  Good Utility Practice
is not limited to a single, optimum  practice, method or act to the exclusion
of others, but rather is  intended to include acceptable practices, methods, or
acts generally  accepted in the region.

1.28 HQ Contracts are the HQ Interconnection Agreement, the HQ Phase I Energy
Contract, and the HQ Phase II Firm Energy Contract.

1.29 HQ Energy Banking Agreement is the Energy Banking Agreement entered into
on March 21, 1983 by Hydro-Quebec, the Participants, New England  Electric
Transmission Corporation and Vermont Electric Transmission  Company, Inc., as
it may be amended from time to time.

1.30 HQ Interconnection is the United States segment of the transmission
interconnection which connects the systems of Hydro-Quebec and the
Participants.  "Phase I" is the United States portion of the 450 kV HVDC
transmission line from a terminal at the Des Cantons Substation on the
Hydro-Quebec system near Sherbrooke, Quebec to a terminal having an
approximate rating of 690 MW at a substation at the Comerford Generating
Station on the Connecticut River.  "Phase II" is the United States  portion of
the facilities required to increase to approximately 2000 MW  the transfer
capacity of the HQ Interconnection, including an extension  of the HVDC
transmission line from the terminus of Phase I at the  Comerford Station
through New Hampshire to a terminal at the Sandy Pond  Substation in
Massachusetts.  The HQ Interconnection does not include  any PTF facilities
installed or modified to effect reinforcements of the  New England AC
transmission system required in connection with the HVDC  transmission line and
terminals.

1.31 HQ Interconnection Agreement is the Interconnection Agreement entered
into on March 21, 1983 by Hydro-Quebec and the Participants, as it may  be
amended from time to time.

1.32 HQ Interconnection Capability Credit of a Participant for a month during
the Base Term (as defined in Section 1.38) of the HQ Phase II Firm  Energy
Contract is the sum in Kilowatts of (1)(a) the Participant's  percentage share,
if any, of the HQ Phase I Transfer Capability times  (b) the HQ Phase I
Transfer Credit, plus (2)(a) the Participant's  percentage share, if any, of
the HQ Phase II Transfer Capability, times  (b) the HQ Phase II Transfer
Credit. The Participants Committee shall  establish appropriate HQ
Interconnection Capability Credits to apply for  a Participant which has such a
percentage share (i) during an extension  of the HQ Phase II Firm Energy
Contract, and (ii) following the  expiration of the HQ Phase II Firm Energy
Contract.

1.33 HQ Interconnection Transfer Capability is the transfer capacity of the  HQ
Interconnection under normal operating conditions, as determined in  accordance
with Good Utility Practice.  The "HQ Phase I Transfer  Capability" is the
transfer capacity under normal operating conditions,  as determined in
accordance with Good Utility Practice, of the Phase I  terminal facilities as
determined initially as of the time immediately  prior to Phase II of the
Interconnection first being placed in service,  and as adjusted thereafter only
to take into account changes in the  transfer capacity which are independent of
any effect of Phase II on the  operation of Phase I.  The "HQ Phase II Transfer
Capability" is the  difference between the HQ Interconnection Transfer
Capability and the HQ  Phase I Transfer Capability.  Determinations of, and any
adjustment in,  transfer capacity shall be made by the Markets Committee in
accordance  with a schedule consistent with that followed by it in its
determination  of the Winter Capability and Summer Capability of generating
units.

1.34 HQ Net Interconnection Capability Credit of a Participant at a  particular
time is its HQ Interconnection Capability Credit at the time  in Kilowatts,
minus a number of Kilowatts equal to (1) the percentage of  its share of the HQ
Interconnection Transfer Capability committed or  used by it for an
"Entitlement Transaction" at the time under the HQ Use  Agreement, times (2)
its HQ Interconnection Capability Credit for the  current month.

1.35 HQ Phase I Energy Contract is the Energy Contract entered into on March
21, 1983 by Hydro-Quebec and the Participants, as it may be amended from  time
to time.

1.36 HQ Phase I Percentage is the percentage of the total HQ Interconnection
Transfer Capability represented by the HQ Phase I Transfer Capability.

1.37 HQ Phase I Transfer Credit is 60/69 of the HQ Phase I Transfer
Capability, or such other fraction of the HQ Phase I Transfer Capability  as
the Participants Committee may establish.

1.38 HQ Phase II Firm Energy Contract is the Firm Energy Contract dated as of
October 14, 1985 between Hydro-Quebec and certain of the Participants,  as it
may be amended from time to time.  The "Base Term" of the HQ Phase  II Firm
Energy Contract is the period commencing on the date deliveries  were first
made under the Contract and ending on August 31, 2000.

1.39 HQ Phase II Gross Transfer Responsibility of a Participant for any month
during the Base Term of the HQ Phase II Firm Energy Contract (as defined  in
Section 1.38) is the number in Kilowatts of (a) the Participant's  percentage
share, if any, of the HQ Phase II Transfer Capability for the  month times (b)
the HQ Phase II Transfer Credit.  Following the Base  Term of the HQ Phase II
Firm Energy Contract, and again following the  expiration of the HQ Phase II
Firm Energy Contract, the Participants  Committee shall establish an
appropriate HQ Phase II Gross Transfer  Responsibility that shall remain in
effect concurrently with the HQ  Interconnection Capability Credit.

1.40 HQ Phase II Net Transfer Responsibility of a Participant for any month  is
its HQ Phase II Gross Transfer Responsibility for the month minus a  number of
Kilowatts equal to (1) the highest percentage of its share of  the HQ
Interconnection Transfer Capability committed or used by it on  any day of the
month for an "Entitlement Transaction" under the HQ Use  Agreement, times (2)
its HQ Phase II Gross Transfer Responsibility for  the month.

1.41 HQ Phase II Percentage is the percentage of the total HQ Interconnection
Transfer Capability represented by the HQ Phase II Transfer Capability.

1.42 HQ Phase II Transfer Credit is 90/131 of the HQ Phase II Transfer
Capability, or such other fraction of the HQ Phase II Transfer  Capability as
the Participants Committee may establish.

1.43 HQ Use Agreement is the Agreement with Respect to Use of Quebec
Interconnection dated as of December 1, 1981 among certain of the
Participants, as amended and restated as of September 1, 1985 and as it  may be
further amended from time to time.

1.44 Installed Capability of an electric generating unit or combination of
units during the Winter Period is the Winter Capability of such unit or  units
and during the Summer Period is the Summer Capability of such unit  or units.

1.45 Installed Capability Entitlement is (a) the right to all or a portion of
the Installed Capability of a generating unit or units to which an  Entity is
entitled as an owner (either sole or in common) or as a  purchaser pursuant to
a Unit Contract, (b) reduced by any portion  thereof which such Entity is
selling pursuant to a Unit Contract, and  (c) further reduced or increased, as
appropriate, to recognize rights to  receive or obligations to supply Installed
Capability pursuant to Firm  Contracts or System Contracts in accordance with
Section 14.7(a).  An  Installed Capability Entitlement relating to a unit or
units may, but  need not, be combined with any other Entitlements relating to
such  generating unit or units and may be transferred separately from the
related Energy Entitlement, Operating Reserve Entitlements, or AGC
Entitlement.

1.46 Installed Capability Responsibility * of a Participant for any month is
the number of Kilowatts determined in accordance with Section 12.2.

1.47 Installed System Capability of a Participant at a particular time is (1)
the sum of such Participant's Installed Capability Entitlements plus (2)  its
HQ Net Interconnection Capability Credit at the time.

1.48 Interchange Transactions are transactions deemed to be effected under
Section 12 of the Prior NEPOOL Agreement prior to the Second Effective  Date,
and transactions deemed to be effected under Section 14 of this  Agreement on
and after the Second Effective Date.

1.49 Internal Point-to-Point Service is the transmission service by that name
provided pursuant to Section 19 of the Tariff.

1.50 Interruption is a reduction in non-firm transmission service due to
economic reasons pursuant to Section 28.7 of the Tariff, other than a
reduction which results from a failure to dispatch a generating  resource,
including a contract, used in a transaction requiring In  Service or Through or
Out Service which is out of merit order.

1.51 ISO is the Independent System Operator which is responsible for the
continued operation of the NEPOOL Control Area from the NEPOOL control  center
and the administration of the Tariff, subject to regulation by  the Commission.
1.52 Kilowatt is a kilowatthour per hour.

1.52A     Liaison Committee is the committee whose responsibilities are
specified in Section 11C.

1.53 Load * (in Kilowatts) of a Participant during any particular hour is the
total during such hour (eliminating any distortion arising out of (i)
Interchange Transactions, or (ii) transactions across the system of such
Participant, or (iii) deliveries between Entities constituting a single
Participant, or (iv) other electrical losses, if and as appropriate) of

(a)  kilowatthours provided by such Participant to its retail customers  for
consumption (excluding any kilowatthours which may be  classified as
interruptible under market operation rules approved  by the Markets Committee),
plus

(b)  kilowatthours delivered by such Participant pursuant to Firm  Contracts to
its wholesale customers for resale, plus

(c)  kilowatthours of use by such Participant, exclusive of use by such
Participant for the operation and maintenance of its generating  unit or units,
plus

(d)  kilowatthours of electrical losses and unaccounted for use by the
Participant on its system.   The Load of a Participant may be calculated in any
reasonable manner  which substantially complies with this definition.

For the purposes of calculating a Participant's Annual Peak, Adjusted  Monthly
Peak, Adjusted Annual Peak and Monthly Peak, the Load of a  Participant shall
be adjusted to eliminate any distortions resulting  from voltage reductions.
In addition, upon the request of any  Participant, the Markets Committee shall
make, or supervise the making  of, appropriate adjustments in the computation
of Load for the purposes  of calculating any Participant's Annual Peak,
Adjusted Monthly Peak,  Adjusted Annual Peak and Monthly Peak to eliminate any
distortions  resulting from emergency load curtailments which would
significantly  affect the Load of any Participant.

1.54 Local Network is the transmission facilities constituting a local  network
identified on Attachment E to the Tariff, and any other local  network or
change in the designation of a Local Network as a Local  Network which the
Participants Committee may designate or approve from  time to time.  The
Participants Committee may not unreasonably withhold  approval of a request by
a Participant that it effect such a change or  designation.

1.55 Local Network Service is the service provided, under a separate tariff  or
contract, by a Participant that is a Transmission Provider to another
Participant, or other entity connected to the Transmission Provider's  Local
Network to permit the other Participant or entity to efficiently  and
economically utilize its resources to serve its load.

1.56 Lower Voltage PTF are all PTF facilities other than EHV PTF.

1.57 Market Products are Installed Capability, Operable Capability, Energy,
each category of Operating Reserve and AGC.

1.57A     Market Rules are the system rules and operating procedures adopted
pursuant to the System Operator Agreement in connection with the
administration of the NEPOOL Market.

1.58 [Deleted.]

1.58A     Markets Committee is the committee whose responsibilities are
specified in Section 10 and which may have additional responsibilities  under a
proper delegation of authority by the Participants Committee.   To the extent
practicable, references in the Agreement to the Markets  Committee shall
include the prior Regional Market Operations Committee  as the predecessor of
the Markets Committee.

1.59 Monthly Peak of a Participant for a month is the maximum Adjusted Load  of
the Participant during any hour in the month.

1.60 NEPOOL is the New England Power Pool, the power pool created under and
governed by this Agreement, and the Entities collectively participating  in the
New England Power Pool as Participants.

1.61 NEPOOL Control Area is the integrated electric power system to which a
common Automatic Generation Control scheme and various operating  procedures
are applied by or under the supervision of the System  Operator in order to:

(i)  match, at all times, the power output of the generators within  the
electric power system and capacity and Energy purchased  from entities outside
the electric power system, with the load  within the electric power system;

(ii) maintain scheduled interchange with other interconnected  systems, within
the limits of Good Utility Practice;

(iii)     maintain the frequency of the electric power system  within
reasonable limits in accordance with Good Utility  Practice and the criteria of
the NPCC and NERC; and

(iv) provide sufficient generating capacity to maintain operating  reserves in
accordance with Good Utility Practice.

1.62 NEPOOL Installed Capability at any particular time is the sum of the
Installed System Capabilities of all Participants at such time.

1.63 NEPOOL Installed Capability Responsibility for any month is the sum of
the Installed Capability Responsibilities of all Participants during  that
month.

1.64 NEPOOL Objective Capability for any year or period during a year is the
minimum NEPOOL Installed Capability, treating the reliability benefits  of the
HQ Interconnection as Installed Capability, as established by the  Participants
Committee, required to be provided by the Participants in  aggregate for the
period to meet the reliability standards established  by the Participants
Committee pursuant to Section 7.5(e).

1.64A     NEPOOL Market is the market for electric energy, capacity and
certain ancillary services within the NEPOOL Control Area.

1.64B     NEPOOL System Rules are the Market Rules, the NEPOOL Information
Policy and any other system rules for the operation of the System and
administration of the NEPOOL Market, the NEPOOL Agreement and the NEPOOL
Tariff.

1.64C     NERC is the North American Electric Reliability Council.

1.65 New Unit is an electric generating unit (including a unit or units owned
by a Non-Participant in which a Participant has an Entitlement under a  Unit
Contract) first placed into commercial operation after May 1, 1987  (or, in the
case of a unit or units owned by a Non-Participant, in which  a Participant's
Unit Contract Entitlement became effective after May 1,  1987) and not listed
on Exhibit B to the Prior NEPOOL Agreement.

1.66 Non-Participant is any entity which is not a Participant.

1.66A     NPCC is the Northeast Power Coordinating Council.

1.66B     OASIS is the Open Access Same-Time Information System of the System
Operator.

1.67 Operable Capability of an electric generating unit or units in any hour
is the portion of the Installed Capability of the unit or units which is
operating or available to respond within an appropriate period (as  identified
in market operation rules approved by the Markets Committee)  to the System
Operator's call to meet the Energy and/or Operating  Reserve and/or AGC
requirements of the NEPOOL Control Area during a  Scheduled Dispatch Period or
is available to respond within an  appropriate period to a schedule submitted
by a Participant for the hour  in accordance with market operation rules
approved by the Markets  Committee.

1.68 [Deleted].

1.69 [Deleted].

1.70 [Deleted].

1.71 Operating Reserve is any or a combination of 10-Minute Spinning Reserve,
10-Minute Non-Spinning Reserve, and 30-Minute Operating Reserve, as the
context requires.

1.72 Operating Reserve Entitlement is (a) the right to all or a portion of  the
Operating Reserve of any category which can be provided by a  generating unit
or units to which an Entity is entitled as an owner  (either sole or in common)
or as a purchaser pursuant to a Unit  Contract, (b) reduced by any portion
thereof which such Entity is  selling pursuant to a Unit Contract, and (c)
further reduced or  increased, as appropriate, to recognize rights to receive
or obligations  to supply Operating Reserve of that category pursuant to Firm
Contracts  or System Contracts in accordance with Section 14.7(a).  An
Operating  Reserve Entitlement in any category relating to a generating unit or
units may, but need not, be combined with any other Entitlements  relating to
such generating unit or units and may be transferred  separately from the other
categories of Operating Reserve Entitlements  related to such unit or units and
from the related Installed Capability  Entitlement, Energy Entitlement, or AGC
Entitlement.

1.73 Other HQ Energy is Energy purchased under the HQ Phase I Energy Contract
which is classified as "Other Energy" under that contract.

1.74 Participant is an eligible Entity (or group of Entities which has  elected
to be treated as a single Participant pursuant to Section 4.1)  which is a
signatory to this Agreement and has become a Participant in  accordance with
Section 3.1 until such time as such Entity's status as a  Participant
terminates pursuant to Section 21.2.

1.74A     Participants Committee is the committee whose responsibilities are
specified in Section 7.  To the extent applicable, references in the  Agreement
to the Participants Committee shall include the prior  Management Committee or
Executive Committee as the predecessor of the  Participants Committee.

1.75 Pool-Planned Facility is a generation or transmission facility  designated
as "pool-planned" pursuant to Section 18.1.

1.76 Pool-Planned Unit is one of the following units: New Haven Harbor Unit 1
(Coke Works), Mystic Unit 7, Canal Unit 2, Potter Unit 2, Wyman Unit 4,  Stony
Brook Units 1, 1A, 1B, 1C, 2A and 2B, Millstone Unit 3, Seabrook  Unit 1 and
Waters River Unit 2 (to the extent of 7 megawatts of its  Summer Capability and
12 megawatts of its Winter Capability).

1.77 Power Year is (i) the period of twelve (12) months commencing on  November
1, in each year to and including 1997; (ii) the period of seven  (7) months
commencing on November 1, 1998; and (iii) the period of  twelve (12) months
commencing on June 1, 1999 and each June 1  thereafter.

1.78 Prior NEPOOL Agreement is the NEPOOL Agreement as in effect on December
1, 1996.

1.79 Proxy Unit is a hypothetical electric generating unit which possesses a
Winter Capability, equivalent forced outage rate, annual maintenance  outage
requirement, and seasonal derating determined in accordance with  Section
12.2(a)(2).

1.80 PTF are the pool transmission facilities defined in Section 15.1, and  any
other new transmission facilities which the Reliability Committee  determines,
in accordance with criteria approved by the Participants  Committee and subject
to review by the System Operator, should be  included in PTF.

1.80A     Publicly Owned Entity is an Entity which is either a municipality  or
an agency thereof, or a body politic and public corporation created  under the
authority of one of the New England states, authorized to own,  lease and
operate electric generation, transmission or distribution  facilities, or an
electric cooperative, or an organization of any such  entities.

1.81 [Deleted.]

1.82 Regional Network Service is the transmission service by that name
provided pursuant to Section 14 of the Tariff.

1.83 [Deleted.]

1.84 [Deleted.]

1.85 Related Person of a Participant is either (i) a corporation,  partnership,
business trust or other business organization 10% or more  of the stock or
equity interest in which is owned directly or indirectly  by, or is under
common control with, the Participant, or (ii) a  corporation, partnership,
business trust or other business organization  which owns directly or
indirectly 10% or more of the stock or other  equity interest in the
Participant, or (iii) a corporation, partnership,  business trust or other
business organization 10% or more of the stock  or other equity interest in
which is owned directly or indirectly by a  corporation, partnership, business
trust or other business organization  which also owns 10% or more of the stock
or other equity interest in the  Participant.

1.85A     Reliability Committee is the committee whose responsibilities are
specified in Section 8 and which may have additional responsibilities  under a
proper delegation of authority by the Participants Committee.   To the extent
practicable, references in the Agreement to the  Reliability Committee shall
include the prior Market Reliability  Planning Committee or the prior Regional
Transmission Planning Committee  as the predecessor of the Reliability
Committee.

1.85B     Reliability Standards are those rules, standards, procedures and
protocols approved by the Participants Committee pursuant to Section  7.3, or
its predecessors, that set forth specifics concerning how the  System Operator
shall exercise its authority over matters pertaining to  the reliability of the
bulk power system.

1.85C     Review Board is the board whose responsibilities are specified in
Section 11A.

1.86 Scheduled Dispatch Period is the shortest period for which the System
Operator performs and publishes a projected dispatch schedule based on
projected Electrical Loads and actual Bid Prices and Participant- directed
schedules for resources submitted in accordance with Section  14.2(d).

1.87 Second Effective Date is May 1, 1999.

1.87A     Sector has the meaning specified in Section 6.2.

1.88 Service Agreement is the initial agreement and any amendments or
supplements thereto entered into by the Transmission Customer and the  System
Operator for service under the Tariff.

1.89 Summer Capability of an electric generating unit or combination of units
is the maximum dependable load carrying ability in Kilowatts of such  unit or
units (exclusive of capacity required for station use) during  the Summer
Period, as determined by the Markets Committee in accordance  with Section
10.4(d).

1.90 Summer Period in each Power Year is the four-month period from June
through September.

1.91 System Contract is any contract for the purchase of Installed  Capability,
Energy, Operating Reserves and/or AGC, other than a Unit  Contract or Firm
Contract, pursuant to which the purchaser is entitled  to a specifically
determined or determinable amount of such Installed  Capability, Energy,
Operating Reserves and/or AGC.

1.92 System Impact Study is an assessment pursuant to Part V, VI or VII of  the
Tariff of (i) the adequacy of the NEPOOL Transmission System to  accommodate a
request for the interconnection of a new or materially  changed generating unit
or a new or materially changed interconnection  to another Control Area or new
Regional Network Service, Internal Point- to-Point Service or Through or Out
Service, and (ii) whether any  additional costs may be required to be incurred
in order to provide the  interconnection or transmission service.

1.93 System Operator is the central dispatching agency provided for in this
Agreement which has responsibility for the operation of the NEPOOL  Control
Area from the NEPOOL control center and the administration of  the Tariff.  The
System Operator is ISO New England Inc., unless  replaced by a substitute
independent system operator, a regional  transmission organization or an entity
that forms a part of a regional  transmission organization that has, in each
case, been approved by the  Commission.

1.94 Target Availability Rate is the assumed availability of a type of
generating unit utilized by the Participants Committee in its  determination
pursuant to Section 7.5(e) of NEPOOL Objective Capability.

1.95 Tariff is the NEPOOL Open Access Transmission Tariff set out in
Attachment B to the Agreement, as modified and amended from time to  time.

1.95A     Tariff Committee is the committee whose responsibilities are
specified in Section 9 and which may have additional responsibilities  under a
proper delegation of authority by the Participants Committee.   To the extent
practicable, references in the Agreement to the Tariff  Committee shall include
the prior Regional Transmission Operations  Committee as the predecessor of the
Tariff Committee.

1.95B     Technical Committees are the Reliability Committee, the Tariff
Committee and the Markets Committee.

1.96 Third Effective Date is the date on which all Interchange Transactions
shall begin to be effected on the basis of separate Bid Prices for each  type
of Entitlement.  The Third Effective Date shall be fixed at the  discretion of
the Participants Committee to occur within six months to  one year after the
Second Effective Date, or at such later date as the  Commission may fix on its
own or pursuant to a request by the  Participants Committee.

1.97 Through or Out Service is the transmission service by that name provided
pursuant to Section 18 of the Tariff.

1.98 Transition Period is the six-year period commencing on March 1, 1997.

1.99 Transmission Customer is any Eligible Customer that (i) is a Participant
which is not required to sign a Service Agreement with respect to a  service to
be furnished to it in accordance with Section 48 of the  Tariff or (ii)
executes, on its own behalf or through its Designated  Agent, a Service
Agreement, or (iii) requests in writing, on its own  behalf or through its
Designated Agent, that NEPOOL file with the  Commission a proposed unexecuted
Service Agreement in order that the  Eligible Customer may receive transmission
service under the Tariff.

1.99A     Transmission Owner is a Transmission Provider which makes its PTF
available under the Tariff and owns a Local Network listed in Attachment  E to
the Tariff which is not a Publicly Owned Entity, including any  affiliate of a
Transmission Provider that owns transmission facilities  that are made
available as part of the Transmission Provider's Local  Network; provided that
if a Transmission Provider is not listed in  Attachment E to the Tariff on May
10, 1999, the Transmission Provider  must also (1) own, or lease with rights
equivalent to ownership, PTF  with an original capital investment in its PTF as
of the end of the most  recent year for which figures are available from annual
reports  submitted to the Commission in Form 1 or any similar form containing
comparable annualized data of at least $30,000,000, and (2) provide
transmission service to non-affiliated customers pursuant to an open  access
transmission tariff on file with the Commission.

1.99B     Transmission Owners Committee is the committee whose
responsibilities are specified in Section 11B.

1.100     Transmission Provider is the Participants, collectively, which own
PTF and are in the business of providing transmission service or provide
service under a local open access transmission tariff, or in the case of  a
state or municipal or cooperatively-owned Participant, would be  required to do
so if requested pursuant to the reciprocity requirements  specified in the
Tariff, or an individual such Participant, whichever is  appropriate.

1.101     Unit Contract is a purchase contract pursuant to which the  purchaser
is in effect currently entitled either (i) to a specifically  determined or
determinable portion of the Installed Capability of a  specific electric
generating unit or units, or (ii) to a specifically  determined or determinable
amount of Energy, Operating Reserves and/or  AGC if, or to the extent that, a
specific electric generating unit or  units is or can be operated.

1.102     [Deleted.]

1.103     Winter Capability of an electric generating unit or combination of
units is the maximum dependable load carrying ability in Kilowatts of  such
unit or units (exclusive of capacity required for station use)  during the
Winter Period, as determined by the Markets Committee in  accordance with
Section 10.4(d).

1.104     Winter Period in each Power Year is (i) the seven-month period from
November through May and the month of October for the Power Year  commencing on
November 1 in 1997 or a prior Power Year; (ii) the seven- month period from
November through May for the Power Year commencing on  November 1, 1998; and
(iii) the eight-month period from October through  May for the Power Year
commencing on June 1, 1999 and each June 1  thereafter.

1.105     10-Minute Spinning Reserve in an hour are the following resources
that are designated by the System Operator in accordance with market  operation
rules, as approved by the Markets Committee, to be available  to provide
contingency protection for the system:  (1) the Kilowatts of  Operable
Capability of an electric generating unit or units that are  synchronized to
the system, unloaded during all or part of the hour, and  capable of providing
contingency protection by loading to supply Energy  immediately on demand,
increasing the Energy output over no more than  ten minutes to the full amount
of generating capacity so designated, and  sustaining such Energy output for so
long as the System Operator  determines in accordance with market operation
rules approved by the  Markets Committee is necessary; and (2) any portion of
the Electrical  Load of a Participant that the System Operator is able to
verify as  capable of providing contingency protection by immediately on demand
reducing Energy requirements within ten minutes and maintaining such  reduced
Energy requirements for so long as the System Operator  determines in
accordance with market operation rules approved by the  Markets Committee is
necessary.

1.106     10-Minute Non-Spinning Reserve in an hour are the following
resources that are designated by the System Operator in accordance with  market
operation rules, as approved by the Markets Committee, to be  available to
provide contingency protection for the system: (1) the  Kilowatts of Operable
Capability of an electric generating unit or units  that are not synchronized
to the system, during all or part of the hour,  and any portion of a
Participant's Electrical Load that the System  Operator is able to verify as
capable of providing contingency  protection by loading to supply Energy within
ten minutes to the full  amount of generating capacity so designated, and
sustaining such Energy  output reducing Energy requirements within ten minutes
and maintaining  such reduced Energy requirements for so long as the System
Operator  determines in accordance with market operation rules approved by the
Markets Committee is necessary; (2) any portion of a Participant's  Electrical
Load that the System Operator is able to verify as capable of  providing
contingency protection by reducing Energy requirements within  ten minutes and
maintaining such reduced Energy requirements for so long  as the System
Operator determines in accordance with market operations  rules approved by the
Markets Committee is necessary; and (3) any other  resources and requirements
that were able to be designated for the hour  as 10-Minute Spinning Reserve but
were not designated by the System  Operator for such purpose in the hour.

1.107     30-Minute Operating Reserve in an hour are the following resources
that are designated by the System Operator in accordance with market  operation
rules, as approved by the Markets Committee, to be available  to provide
contingency protection for the system:  (1) the Kilowatts of  Operable
Capability of an electric generating unit or units that are any  portion of the
Electrical Load of a Participant that the System Operator  is able to verify as
capable of providing contingency protection by  reducing Energy requirements
within thirty minutes and maintaining such  reduced Energy requirements for so
long as the System Operator  determines in accordance with market operation
rules approved by the  Markets Committee is necessary; (2) any portion of the
Electrical Load  of a Participant that the System Operator is able to verify as
capable  of providing contingency protection by reducing Energy requirements
within thirty minutes and maintaining such reduced Energy requirements  for so
long as the System Operator determines in accordance with market  operation
rules approved by the Markets Committee is necessary; and (3)  any other
resources and requirements that were able to be designated for  the hour as
10-Minute Spinning Reserve or 10-Minute Non-Spinning Reserve  but were not
designated by the System Operator for such purposes in the  hour.

1.108     [Deleted.]

1.109     Modification of Certain Definitions When a Participant Purchases a
Portion of Its Requirements from Another Participant Pursuant to Firm  Contract
 Definitions marked by an asterisk (*) are modified as follows when a
Participant purchases a portion of its requirements of electricity from
another Participant pursuant to a Firm Contract:

(a)  If the Firm Contract limits deliveries to a specifically stated  number of
Kilowatts and requires payment of a demand charge thereon  (thus placing the
responsibility for meeting additional demands on  the purchasing Participant):


(1)  in computing the Adjusted Load of the purchasing Participant,  the
Kilowatts received pursuant to such Firm Contract shall be  deemed to be the
number of Kilowatts specified in the Firm  Contract; and

(2)  in computing the Load of the supplying Participant, the  Kilowatts
delivered pursuant to such Firm Contract shall be  deemed to be the number of
Kilowatts specified in the Firm  Contract.

(b)  If the Firm Contract does not limit deliveries to a specifically  stated
number of Kilowatts, but entitles the Participant to receive  such amounts of
electricity as it may require to supply its  electric needs (thus placing the
responsibility for meeting  additional demands on the supplying Participant):


(1)  the Installed Capability Responsibility of the purchasing  Participant
shall be equal to the amount of its Installed  Capability Entitlements;

(2)  in computing the Adjusted Load of the purchasing Participant,  the
Kilowatts received pursuant to such Firm Contract shall be  deemed to be a
quantity Rl; and

(3)  in computing the Load of the supplying Participant, the  Kilowatts
delivered pursuant to such Firm Contract shall be  deemed to be a quantity Rl.


The quantity Rl equals (i) the Load of the purchasing Participant  less (ii)
the amount of the purchasing Participant's Installed  Capability

Entitlements multiplied by a fraction       wherein:

X    is the maximum Load of the purchasing Participant in the  month, and

Y    is the NEPOOL Installed Capability Responsibility  multiplied by the
purchasing Participant's fraction P  determined pursuant to Section 12.2(a)(1),
computed as if  the Firm Contract did not exist.

Terms used in this Agreement that are not defined above, or in the  sections in
which such terms are used, shall have the meanings  customarily attributed to
such terms in the electric power industry in  New England.

SECT65535ON 2

PURPOSE; EFFECTIVE DATES

2.1  Purpose.  This Restated NEPOOL Agreement is intended to provide for a
restructuring of the New England Power Pool by modifying the pool's  governance
and market provisions to take account of a changed  competitive environment, by
modifying the transmission responsibilities  of the Participants so that the
pool will perform the functions of a  regional transmission group and provide
service to Participants and Non- Participants under a regional open access
transmission tariff, and by  providing for the activation of the ISO and the
execution of a contract  between the ISO and NEPOOL to define the ISO's
responsibilities.

2.2  Effective Dates; Transitional Provisions.  The provisions of Parts One,
Two, Four and Five of this Agreement and the Tariff became effective on  the
First Effective Date and replaced on the First Effective Date the  provisions
of Sections 1-8, inclusive, 10, 11, 13, 14.2, 14.3, 14.4 and  16 of the Prior
NEPOOL Agreement.  The provisions of Sections 12.1(a),  12.2, 12.4 (as to
Installed Capability only), 12.5 and 12.7(a) of this  Agreement became
effective on April 1, 1998 and replaced on such date  the provisions of Section
9 of the Prior NEPOOL Agreement.

The effectiveness of the remaining Sections of this Restated NEPOOL  Agreement
shall be delayed pending the preparation of implementing  criteria, rules and
standards and computer programs.  These Sections  became effective on the
Second Effective Date and replaced on the Second  Effective Date the remaining
provisions of the Prior NEPOOL Agreement,  which continued in effect until the
Second Effective Date.

As provided in Section 14, certain portions of Section 14 which became
effective on the Second Effective Date will be superseded on the Third
Effective Date by other portions of Section 14.

SECT65535ON 3  MEMBERSHIP

3.1  Membership.  Those Entities which are Participants in NEPOOL on the  First
Effective Date shall continue to be Participants.

Any other Entity may, upon compliance with such reasonable conditions as  the
Participants Committee may prescribe, become a Participant by  depositing a
counterpart of this Agreement as theretofore amended, duly  executed by it,
with the Secretary of the Participants Committee,  accompanied by a certified
copy of a vote of its board of directors, or  such other body or bodies as may
be appropriate, duly authorizing its  execution and performance of this
Agreement, and a check in payment of  the application fee described below.

Any such Entity which satisfies the requirements of this Section 3.1  shall
become a Participant, and this Agreement shall become fully  binding and
effective in accordance with its terms as to such Entity, as  of the first day
of the second calendar month following its satisfaction  of such requirements;
provided that an earlier or later effective time  may be fixed by the
Participants Committee with the concurrence of such  Entity or by the
Commission.

The application fee to be paid by each Entity seeking to become a  Participant
shall be in addition to the annual fee provided by Section  19.1 and shall be
$500 for an applicant which qualifies for membership  only as an End User
Participant, and $5,000 for all other applicants, or  such other amount as may
be fixed by the Participants Committee.

3.2  Operations Outside the Control Area.  Subject to the reciprocity
requirements of the Tariff, if a Participant serves a Load, or has  rights in
supply or demand-side resources or owns transmission and/or  distribution
facilities, located outside of the NEPOOL Control Area,  such Load and
resources shall not be included for purposes of  determining the Participant's
rights, responsibilities and obligations  under this Agreement, except that the
Participant's Entitlements in  facilities or its rights in demand
side-resources outside the NEPOOL  Control Area shall be included in such
determinations if, to the extent,  and while such Entitlements are used for
retail or wholesale sales  within the NEPOOL Control Area or such Entitlements
or rights are  designated by a Participant for purposes of meeting its
obligations  under Section 12 of this Agreement.

3.3  Lack of Place of Business in New England.  If and for so long as a
Participant does not have a place of business located in one of the New
England states, the Participant shall be deemed to irrevocably (1)  submit to
the jurisdiction of any Connecticut state court or United  States Federal court
sitting in Connecticut (the state whose laws govern  this Agreement) over any
action or proceeding arising out of or relating  to this Agreement that is not
subject to the exclusive jurisdiction of  the Commission, (2) agree that all
claims with respect to such action or  proceeding may be heard and determined
in such Connecticut state court  or Federal court, (3) waive any objection to
venue or any action or  proceeding in Connecticut on the basis of forum non
conveniens, and (4)  agree that service of process may be made on the
Participant outside  Connecticut by certified mail, postage prepaid, mailed to
the  Participant at the address of its member on the Participants Committee  as
set out in the NEPOOL roster or at the address of its principal place  of
business.

3.4  Obligation for Deferred Expenses.  NEPOOL may provide for the deferral  on
the books of the Participants from time to time of capital or other
expenditures, and the recovery of the deferred expenses in subsequent  periods.
Any Entity which becomes a Participant during the recovery  period for any such
deferred expenses shall be obligated, together with  the continuing
Participants, for its share of the current and deferred  expenses pursuant to
Section 19.2.  3.5  Financial Security. For an Entity applying to become a
Participant or  any continuing Participant that the Participants Committee
reasonably  determines may fail to meet its financial obligations under the
Agreement, the Participants Committee may require reasonable credit  review
procedures which shall be made in accordance with standard  commercial
practices.  In addition, the Participants Committee may  prescribe for such
Entity or Participant a requirement that the Entity  or Participant provide and
maintain in effect an irrevocable letter of  credit as security to meet its
responsibilities and obligations under  the Agreement, or an alternative form
of security proposed by the Entity  or Participant and acceptable to the
Participants Committee and  consistent with commercial practices established by
the Uniform  Commercial Code that protects the Participants against the risk of
non- payment.

SECT65535ON 4

STATUS OF PARTICIPANTS

4.1  Treatment of Certain Entities as Single Participant.  All Entities which
are controlled by a single person (such as a corporation or a business  trust)
which owns at least seventy-five percent of the voting shares of,  or equity
interest in, each of them shall be collectively treated as a  single
Participant for purposes of this Agreement, if they each elect  such treatment.
They are encouraged to do so.  Such an election shall  be made in writing and
shall continue in effect until revoked in  writing.

In view of the long-standing arrangements in Vermont, Vermont Electric  Power
Company, Inc. and any other Vermont electric utilities which elect  in writing
to be grouped with it shall be collectively treated as a  single Participant
for purposes of this Agreement; provided, however,  that any Vermont electric
utility which is a Publicly Owned Entity may  elect to join the Publicly Owned
Entity Sector and be treated as a  member of that Sector for purposes of
governance, annual fees and NEPOOL  expense allocation, without losing the
benefits of single Participant  status for any other purpose under this
Agreement.

4.2  Participants to Retain Separate Identities.  The signatories to this
Agreement shall not become partners by reason of this Agreement or their
activities hereunder, but as to each other and to third persons, they  shall be
and remain independent contractors in all matters relating to  this Agreement.
This Agreement shall not be construed to create any  liability on the part of
any signatory to anyone not a party to this  Agreement.  Each signatory shall
retain its separate identity and, to  the extent not limited hereby, its
individual freedom in rendering  service to its customers.

SECT65535ON 5

NEPOOL OBJECTIVES AND COOPERATION BY PARTICIPANTS

5.1  NEPOOL Objectives.  The objectives of NEPOOL are, through joint  planning,
central dispatching, cooperation in environmental matters and  coordinated
construction, central dispatch by the System Operator of the  operation and
coordinated maintenance of electric supply and demand-side  resources and
transmission facilities, the provision of an open access  regional transmission
tariff and the provision of a means for effective  coordination with other
power pools and utilities situated in the United  States and Canada,

(a)  to assure that the bulk power supply of the NEPOOL Control Area  conforms
to proper standards of reliability;

(b)  to create and maintain open, non-discriminatory, competitive,  unbundled
markets for Energy, capacity, and ancillary services that  function efficiently
in a changing electric power industry and have  access to regional transmission
at rates that do not vary with  distance;

(c)  to attain maximum practicable economy, consistent with proper  standards
of reliability and the maintenance of competitive  markets, in such bulk power
supply; and

(d)  to provide access to competitive markets within the NEPOOL Control  Area
and to neighboring regions;  and to provide for equitable sharing of the
resulting responsibilities,  benefits and costs.

5.2  Cooperation by Participants.  In order to attain the objectives of  NEPOOL
set forth in Section 5.1, each Participant shall observe the  provisions of
this Agreement in good faith, shall cooperate with all  other Participants and
shall not either alone or in conjunction with one  or more other Entities take
advantage of the provisions of this  Agreement so as to harm another
Participant or to prejudice the position  of any Participant in the electric
power business.

PART TWO

GOVERNANCE

SECT65535ON 6

COMMITTEE ORGANIZATION AND VOTING

6.1  Principal Committees.  There shall be four principal NEPOOL Committees
(the "Principal Committees"), as follows:

(a)  the Participants Committee which shall have the responsibilities
specified in Section 7;

(b)  the Reliability Committee which shall have the responsibilities  specified
in Section 8;

(c)  the Tariff Committee which shall have the responsibilities  specified in
Section 9; and

(d)  the Markets Committee which shall have the responsibilities  specified in
Section 10.

In addition, there shall be a Transmission Owners Committee and a  Liaison
Committee, which shall have the responsibilities specified in  Sections 11B and
11C, respectively, and such other committees as may be  established from time
to time by the Participants Committee.

6.2  Sector Representation.  The members of each Principal Committee shall
each belong to a single sector for voting purposes ("Sector").  Each
Participant shall be obligated to designate in a notice to the Secretary  of
the Participants Committee a Sector that it or its Related Persons is  eligible
to join and that it elects to join for purposes of all of the  Principal
Committees.  A Participant and its Related Persons shall  together be entitled
to join only one Sector and shall have no more than  one vote on each Principal
Committee.

The Sectors for each Principal Committee, the criteria for eligibility  for
membership in each Sector and the minimum requirement which a  Participant must
meet as a member of a Sector in order to appoint a  voting member of the Sector
and Committee are as follows:

(a)  a Generation Sector, which a Participant shall be eligible to join  if (i)
it (A) owns or leases with rights equivalent to ownership  facilities for the
generation of electric energy that are located  within the NEPOOL Control Area
which are currently in operation, or  (B) has proposed generation for operation
within the NEPOOL Control  Area either which has received approvals under
Sections 18.4 and/or  18.5 within the past two years or for which completed
environmental  air or environmental siting applications have been filed or
permits  exist, and (ii) it is not a Publicly Owned Entity.  Purchasing all  or
a portion of the output of a generation facility shall not be  sufficient to
qualify a Participant to join the Generation Sector.

A Participant which joins the Generation Sector shall be entitled  but not
required to designate an individual voting member of each  Principal Committee,
and an alternate to the member, if its  operating or proposed generation
facilities in the NEPOOL Control  Area have or will have, when placed in
operation, an aggregate  Winter Capability of at least 15 MW.  A Participant
which joins the Generation Sector but elects not to  or is not eligible to
designate an individual voting member, shall  be represented by a group voting
member and an alternate to that  member for each Principal Committee
(collectively, the "Generation  Group Member").  The Generation Group Member
shall be appointed by  a majority of the Participants in the Generation Sector
electing or  required to be represented by that member.  The Generation Group
Member shall have the same percentage of the Sector vote as the  individual
voting members designated by other Participants in the  Generation Sector which
meet the 15 MW threshold and designate an  individual voting member.  The
Generation Group Member shall be  entitled to split his or her vote.

(b)  a Transmission Sector, which a Participant shall be eligible to join if it
is a Transmission Provider and is not a Publicly Owned  Entity.  Taking
transmission service shall not be sufficient to  qualify a Participant to join
the Transmission Sector.

A Participant which joins the Transmission Sector shall be entitled  to
designate an individual voting member of each Principal  Committee, and an
alternate to the member, if it owns or leases  with rights equivalent to
ownership PTF with an original capital  investment in its PTF as of the end of
the most recent year for  which figures are available from annual reports
submitted to the  Commission in Form 1 or any similar form containing
comparable  annualized data of at least $30,000,000.  A Transmission Provider
with facilities which were included as PTF prior to December 31,  1998 only
pursuant to clause (3) of the definition of PTF pursuant  to Section 15.1 shall
be entitled to designate an individual voting  member of each Principal
Committee, and an alternate to the member,  whether or not PTF which it owns or
leases with rights equivalent  to ownership which has an original capital
investment of at least  $30,000,000, so long as such Transmission Provider
continues to own  PTF.

A Participant which joins the Transmission Sector but which is not entitled to
designate an individual voting member of each Principal Committee because (i)
it, together with all of its Related Persons,  does not meet the $30,000,000
threshold or (ii) it no longer owns  PTF and it does not have a Related Person
that is entitled to  designate an individual voting member for each Principal
Committee  in another Sector, together with the other Participants in the
Transmission Sector which for the same reasons are unable to  designate an
individual voting member, shall be represented by a  group voting member of
each Principal Committee (the "Transmission  Group Member"), and an alternate
to that member.  The Transmission  Group Member and alternate shall be
appointed by a majority vote of  all Participants in the Transmission Sector
required to be  represented by that Member.  The Transmission Group Member
shall  have the same percentage of the Sector vote as the individual  voting
members designated by other Participants in the Transmission  Sector which meet
the $30,000,000 threshold unless and until the  original capital investment in
PTF of the Participants represented  by the Transmission Group Member equals or
exceeds twice the  $30,000,000 threshold amount.  If the aggregate original
capital  investment in PTF equals or exceeds twice the $30,000,000 threshold
amount, the percentage of the Sector votes assigned to the  Transmission Group
Member shall equal the number of full multiples  of the $30,000,000 threshold,
provided that the Transmission Group  Member shall in no event be entitled to
more than twenty-five  percent (25%) of the Sector vote.  For example, if
Participants  represented by the Transmission Group Member have an aggregate
original capital investment in PTF in the NEPOOL Control Area  totaling
$70,000,000, the Transmission Group Member will have the  same percentage of
such votes as two ($70,000,000/$30,000,000   Threshold = 2.33) individual
voting members designated by  individual Participants, provided that there are
at least six other  members in the Sector so the Transmission Group Member does
not  have more than twenty-five percent (25%) of the Transmission Sector  vote.
The Transmission Group Member shall be entitled to split his  or her vote.

(c)  a Supplier Sector, which a Participant shall be eligible to join if  (i)
it engages in, or is licensed or otherwise authorized by a  state or federal
agency with jurisdiction to engage in, power  marketing, power brokering or
load aggregation within the NEPOOL  Control Area or it had been engaged on and
before December 31, 1998  solely in the distribution of electricity in the
NEPOOL Control  Area, and (ii) it is not a Publicly Owned Entity.  A
Participant  which joins the Supplier Sector shall be entitled to designate a
voting member of each Principal Committee, and an alternate to the  member.

(d)  a Publicly Owned Entity Sector, which all Participants which are  Publicly
Owned Entities are eligible to join and shall join, and  which End User
Participants are eligible to join if there is not an  activated End User
Sector.  A Participant which joins the Publicly  Owned Entity Sector shall be
entitled to designate a voting member  of each Principal Committee, and an
alternate to the member, except  for End User Participants whose voting
interests while they are in  the Publicly Owned Entity Sector are defined in
Section 6.2(e)  below.

(e)  an End User Sector, which an End User Participant is eligible to  join.
Participants which join the End User Sector shall be  entitled to designate a
voting member of each Principal Committee  and an alternate to the member.
Until there are at least ten End  User Participants, all End User Participants
shall be members of  the Publicly Owned Entity Sector.  So long as there are
less than  three End User Participants, the End User Participants in the
Publicly Owned Entity Sector shall be represented on each Principal  Committee
by a single voting member.  At such time as there are at  least three, but less
than ten, End User Participants, End User  Participants shall become a
sub-sector of the Publicly Owned Entity  Sector.  Such sub-sector shall have
twenty percent (20%) of the  Publicly Owned Entity Sector's vote, and each End
User Participant  shall be entitled to designate a voting member of each
Principal  Committee, and an alternate to that member, and each voting member
shall be allocated a per capita share of the sub-sector's vote.   The End User
Sector shall become fully operational automatically as  soon, and shall remain
operational so long as, there are at least  ten End User Participants.

The System Operator shall have the right to designate, by written notice
delivered to the Secretary of the appropriate Principal Committee, a
non-voting member and an alternate to each Principal Committee.  All
Participants have the right to join and be a member of a Sector.  If a
Participant ceases to be eligible to be a member of the Sector which it
previously joined and is not eligible to join another existing Sector  other
than the End User Sector, it shall have the right to remain and  vote in the
Sector in which the Participant is currently a member for up  to one year.  By
the end of such year, the NEPOOL Participants Committee  shall make a filing
with the Commission pursuant to which the  Participant can join another Sector
that either exists or is created  pursuant to the NEPOOL Participants Committee
filing.  Separate Sectors  may be created, and the membership of existing
Sectors may be modified,  by amendment of the Agreement.

6.3  Appointment of Members and Alternates.  A Participant or group of
Participants shall designate, by a written notice delivered to the  Secretary
of the appropriate Committee, the voting member appointed by  it for the
Committee and an alternate of the member.  In the absence of  the member, the
alternate shall have all the powers of the member,  including the power to
vote.  A Participant may change the Sector of  which it is a member.  Other
than for Sector changes required by Section 6.4(c), a change in the Sector in
which a Participant is a member shall  become effective beginning on the first
annual meeting of the  Participants Committee following notice of such change.


6.4  Term of Members.  Each voting member of a Principal Committee shall hold
office until either (a) such member is replaced by the Participant or  group of
Participants which appointed the member, or (b) the appointing  Participant
ceases to be a Participant, or (c) the appointing  Participant (or its Related
Person) is no longer eligible to be in the  Sector to which it belongs, but is
eligible to join a different Sector.   Replacement of a member shall be
effected by delivery by a Participant  or group of Participants of written
notice of such replacement to the  Secretary of the appropriate Committee.

6.5  Regular and Special Meetings.  Each Principal Committee shall hold its
annual meeting in December or January at such time and place as the  Chair
shall designate and shall hold other meetings in accordance with a  schedule
adopted by the Committee or at the call of the Chair.  Five or  more voting
members of a Principal Committee may call subject to the  notice provisions of
Section 6.6 a special meeting of the Committee in  the event that the Chair
fails to schedule  such a meeting within three  business days following the
Chair's receipt from such members of a  request specifying the subject matters
to be acted upon at the meeting.

6.6  Notice of Meetings.  Written or electronic notice of each meeting of a
Principal Committee shall be given to each Participant, whether or not  such
Participant is entitled to appoint an individual voting member of  the
Committee, not less than three business days prior to the date of  the meeting
in the case of the Technical Committees and five business  days prior to the
date of the meeting for the Participants Committee.

A notice of meeting shall specify the principal subject matters expected  to be
acted upon at the meeting.  In addition, such notice shall  include, or specify
internet location of, all draft resolutions to be  voted at the meeting (which
draft resolutions may be subject to  amendment of intent but not subject matter
during the meeting), and all  background materials deemed by the Chair or
Secretary to be necessary to  the Committee to have an informed opinion on such
matters.  Motions  raised for which no draft resolutions or background
materials have been  provided may not be acted upon at a meeting and shall be
deferred to a  subsequent meeting which is properly noticed.

6.7  Attendance.  Regular and special meetings may be conducted in person, by
telephone, or other electronic means by means of which all persons
participating in the meeting can communicate in real time with each  other.  In
order to vote during the course of a meeting, attendance is  required in person
or by telephone or other real time electronic means  by a voting member or its
alternate or a duly designated agent who has  been given, in writing, the
authority to vote for the member on all  matters or on specific matters in
accordance with Section 6.12.

6.8  Quorum.  All actions by a Principal Committee, other than a vote by the
Participants Committee by written ballot to amend the NEPOOL Agreement  or
Tariff, shall be taken at a meeting at which the members in  attendance
pursuant to Section 6.7 constitute a Quorum.  A Quorum  requires the attendance
by members which satisfy the Sector Quorum  requirements (as defined in Section
6.9) for a majority of the activated  Sectors.  No action may be taken by a
Principal Committee unless a  Quorum is present; provided, however, that if a
Quorum is not present,  the voting members then present shall have the power to
adjourn the  meeting from time to time until a quorum shall be present.

6.9  Voting Definitions.  For purposes of this Section 6.9 and Sections 6.10,
6.11 and 6.13, the following terms shall have the following respective
meanings:

(a)  Sector Voting Share: for each active Sector, is the quotient  obtained by
dividing one hundred percent (100%) by the number of  active Sectors.  For
example, if there are five active Sectors, the  Sector Voting Share of each of
the Sectors is twenty percent (20%).   The aggregate Sector Voting Shares shall
equal one hundred percent  100%.

(b)  Sector Quorum: for a Sector shall be the lesser of (i) fifty  percent
(50%) or more (rounded to the next higher whole number) of  the voting members
of the Sector, or (ii) five (5) or more voting  members of the Sector for the
Participants Committee or three (3)  or more voting members of the Sector for
the Technical Committees.

(c)  Member Fixed Voting Share: for a Committee voting member, whether  or not
the member is in attendance, is the quotient obtained by  dividing (i) the
Sector Voting Share of the Sector to which the  Participant or group of
Participants which appointed the Committee  voting member belongs by (ii) the
total number of Committee voting  members appointed by members of that Sector,
adjusted, if  necessary, to take into account (A) the manner in which the
voting  shares of End User Participants are to be determined while they are
members of the Publicly Owned Entity Sector, and (B) any required  change in
the voting share of a Group Member, in each case as  determined in accordance
with Section 6.2.

(d)  Member Adjusted Voting Share: for a Committee voting member which  casts
an affirmative or negative vote on a proposed action or  amendment and which
has been appointed by a Participant or group of  Participants which are members
of a Sector satisfying its Sector  Quorum requirement for the proposed action
or amendment, is the  quotient obtained by dividing (i) the Sector Voting Share
of that  Sector by (ii) the number of voting members appointed by members of
that Sector which cast affirmative or negative votes on the matter,  adjusted,
if necessary, for End User Participants and group voting  members as provided
in the definition of "Member Fixed Voting  Share".

(e)  NEPOOL Vote: with respect to a proposed action or amendment is the  sum of
(i) the Member Adjusted Voting Shares of the voting members  of the Committee
which cast an affirmative vote on the proposed  action or amendment and which
have been appointed by a Participant  or group of Participants which are
members of a Sector satisfying  its Sector Quorum requirements and (ii) the
Member Fixed Voting  Shares of the voting members of the Committee which cast
an  affirmative vote on the proposed action or amendment and which have  been
appointed by a Participant or group of Participants which are  members of a
Sector which fails to satisfy its Sector Quorum  requirements.

(f)  Minimum Response Requirement: with respect to a proposed amendment  to
this Agreement or Tariff means that the ballots received by the  Balloting
Agent from Participants relating to the proposed  amendment before the end of
the appropriate time specified in  Section 6.11(c) must satisfy the following
thresholds:

(i)  the sum of the Member Fixed Voting Shares of the Participant  voting
members whose ballots are received must equal at least  fifty percent (50%);
and

(ii) the Participants whose voting members timely return ballots  for or
against the amendment must include Participants that  are represented by voting
members having at least fifty  percent (50%) of the Member Fixed Voting Shares
in each of a  majority of the activated Sectors.

6.10 Voting On Proposed Actions.  All matters to be acted upon by a Principal
Committee shall be stated in the form of a motion by a voting member,  which
must be seconded.  Only one motion and any one amendment to that  motion may be
pending at one time.  Passage of a motion requires a  NEPOOL Vote as determined
pursuant to Section 6.9 equal to or greater  than two thirds of the aggregate
Sector Voting Shares.  Voting members  not in attendance or represented at a
meeting as specified in Section  6.7 or abstaining shall not be counted as
affirmative or negative votes.

6.11 Voting On Amendments.  Subject to Section 21.11 and Section 17A,
amendments to the NEPOOL Agreement or Tariff shall be accomplished as  follows:


(a)  Amendments shall be drafted by a standing or ad hoc NEPOOL  committee or a
Participant and sent to the Participants Committee  for its consideration.

(b)  The Participants Committee shall take action pursuant to Section  6.10 to
direct the Balloting Agent to circulate ballots for  approval of the draft
Amendment to each Participant for execution  by its voting member or alternate
on the Participants Committee or  such Participant's duly authorized officer.

(c)  In order to be counted, ballots must be executed and returned to  the
Balloting Agent for NEPOOL in accordance with the following  schedule:

(i)  If the ballots are delivered to each Participant by regular  mail,
properly executed ballots must be returned to and  received by the Balloting
Agent within ten (10) business days  after deposit of such ballots in the mail
by the Balloting  Agent, and

(ii) If the ballots are delivered to each Participant by overnight  delivery,
facsimile, electronic mail or hand delivery, then  properly executed ballots
must be returned to and received by  the Balloting Agent within five (5)
business days after (A)  deposit of such ballots with an overnight delivery
courier if  delivered by overnight delivery, or (B) transmission of such
ballots by the Balloting Agent if delivered by facsimile or  electronic mail,
or (C) receipt by the Participant if  delivered by hand delivery.

(iii)     If the Minimum Response Requirement for an amendment has  not been
received by the Balloting Agent within the schedule  identified in subsection
(i) or (ii) above, the Balloting  Agent shall send notice by overnight
delivery, facsimile,  electronic mail or hand delivery to all non-responding
Participants and shall count any additional properly executed  ballots which it
receives within five (5) business days after  such notice.  The date by which
properly executed ballots must  be returned and received by the Balloting Agent
shall be  specified by the Balloting Agent in the notice accompanying  such
ballots.

(d)  A Participant may appeal to the Review Board or submit for  resolution
pursuant to the alternative dispute resolution  provisions of Section 21.1 a
proposed amendment for which ballots  have been circulated, provided that such
appeal is taken or  submission is presented before the end of the tenth (10th)
business  day after the Participants Committee has taken action to direct the
Balloting Agent to circulate ballots for approval of the draft  amendment, by
giving to the Secretary of the Participants Committee  a signed and written
notice of appeal or submission.  The appeal  shall be moot, or submission shall
be deemed withdrawn, if the  amendment is not approved in balloting by the
Participants  Committee.  If the amendment is approved, a valid appeal or
submission shall stay the filing with the Commission of any  amendment to the
NEPOOL Agreement or Tariff until either (i) a  decision on the appeal by the
Review Board, or (ii) the earlier of  resolution pursuant to Section 21.1 or
termination pursuant to  Section 21.1.B(2) of the suspension effects of the
submission.

(e)  In order for a proposed amendment to the NEPOOL Agreement or Tariff  to be
approved by the Participants Committee, the following  criteria must be
satisfied:

(i)  The Minimum Response Requirement must be satisfied with  respect to the
proposed amendment.

(ii) The affirmative ballot votes with respect to the proposed  amendment must
equal or exceed two thirds of the aggregate  Sector Voting Shares.

6.12 Designated Representatives and Proxies.  The vote of any member of a
Principal Committee or the member's alternate, other than a ballot on an
amendment, may be cast by another person pursuant to a written, standing
designation or proxy.  A designation or proxy shall be dated not more  than one
year previous to the meeting and shall be delivered by the  member or alternate
to the Secretary of the Committee at or prior to any  votes being taken at the
meeting at which the vote is cast pursuant to  such designation or proxy.  A
single individual may be the designated  representative of or be given the
proxy of the voting members  representing any number of Participants of any one
Sector or  Participants from multiple Sectors.

6.13 Limits on Representatives.  In the Generation Sector, no one person may
exercise more than twenty-five percent (25%) of that Sector's total  Member
Fixed Voting Shares without the unanimous written agreement of  all members of
the Generation Sector.  Other Sectors may by unanimous  written agreement elect
to impose limits on the voting power any one  individual may have in that
Sector through being the designated  representative of multiple voting members
or carrying multiple proxies  from voting members of that Sector.  Notice of
any such limits on voting  power must be posted on the System Operator home
page and be capable of  being accessed by all Participants.

6.14 Adoption of Bylaws.  The Participants Committee shall adopt bylaws,
consistent with this Agreement, governing procedural matters including  the
conduct of its meetings and those of the other Principal Committees.   If there
is any conflict between such bylaws and the Agreement, the  Agreement shall
control.  A Principal Committee may vote to waive its  bylaws for a particular
meeting, provided the motion to effect the  waiver is approved in accordance
with Section 6.10.

6.15 Joint Meetings of Technical Committees.  It is recognized that
responsibilities of the Technical Committees may overlap in certain  areas.  In
areas of overlap, the Reliability Committee is responsible  for addressing
reliability matters, the Markets Committee is responsible  for addressing
market implications of actions or recommendations, and  the Tariff Committee is
responsible for addressing issues relating to  transmission and ancillary
services.  The Chairs of the Technical  Committees, with input from the Liaison
Committee Co-Chairs or entire  Liaison Committee, as appropriate, shall
prioritize and sequence  Technical Committee activities to ensure full and
proper input by  Participants while maximizing the efficiency of the decision
making  process.  To the extent appropriate and desirable, the Technical
Committees are authorized and encouraged to hold meetings, and to  conduct
studies and exercise responsibilities, jointly with other  Technical
Committees.

SECT65535ON 7

PARTICIPANTS COMMITTEE

7.1  Officers.  At its annual meeting, the Participants Committee shall elect
from among its members a Chair and Vice-Chair; it shall also elect a  Secretary
who shall not be a member.  These officers shall have the  powers and duties
usually incident to such offices and as set forth in  the Committee bylaws.

7.2  Adoption of Budgets.  At each annual meeting, the Participants Committee
shall adopt a NEPOOL budget for the ensuing calendar year.  In adopting
budgets the Participants Committee shall give due consideration to the
budgetary requests of each committee.  The Participants Committee may  modify
any NEPOOL budget from time to time after its adoption.

7.3  Establishing Reliability Standards.  It shall be the duty of the
Participants Committee, after review of reports, recommendations and  actions
of the System Operator and the Reliability Committee and such  other matters as
the Participants Committee deems pertinent, to  establish or approve
Reliability Standards for the bulk power supply of  NEPOOL.  Such Reliability
Standards shall be consistent with the  directives of NERC and the NPCC and
shall be reviewed periodically by  the Participants Committee and revised as
the Participants Committee  deems appropriate.

7.4  Appointment and Compensation of NEPOOL Personnel.  The Participants
Committee shall determine what personnel are desirable for the effective
operation and administration of NEPOOL and shall fix or authorize the  fixing
of the compensation for such persons.  In addition, the  Participants Committee
shall determine what resources are desirable for  the effective operation of
the Technical Committees and shall, on its  own or pursuant to the
recommendation of a Technical Committee,  authorize the incurrence of such
expenses as may be required to enable  the Technical Committee, or its
subgroups, to properly perform their  duties, including, but not limited to,
the retention of a consultant or  the procurement of computer time.

7.5  Duties and Authority.

(a)  The Participants Committee shall have the duty and requisite  authority to
administer, enforce and interpret the provisions of  this Agreement and any
other agreement or document approved by the  Participants Committee or its
predecessor in order to accomplish  the objectives of NEPOOL including the
making of any decision or  determination necessary under any provision of this
Agreement or  any other agreement or document approved by the Participants
Committee or its predecessor and not expressly specified to be  decided or
determined by any other body.

(b)  The Participants Committee shall have the authority to provide for  such
facilities, materials and supplies as the Participants  Committee may determine
are necessary or desirable to carry out the  provisions of this Agreement.

(c)  The Participants Committee shall have, in addition to the authority
provided in Section 7.3, the authority, after consultation with  other NEPOOL
committees and the System Operator, to establish or  approve consistent
standards with respect to any aspect of  arrangements between Participants and
Non-Participants which it  determines may adversely affect the reliability of
NEPOOL, and to  review such arrangements to determine compliance with such
standards.

(d)  The Participants Committee, or its designee, shall have the  authority to
act on behalf of all Participants in carrying out any  action properly taken
pursuant to the provisions of this Agreement.   Without limiting the foregoing
general authority, the Participants  Committee, or its designee, shall have the
authority on behalf of  all Participants to execute any contract, lease or
other instrument  which has been properly authorized pursuant to this Agreement
including, but not limited to, one or more contracts with the  System Operator,
and to file with the Commission and other  appropriate regulatory bodies:  (i)
this Agreement and documents  amending or supplementing this Agreement,
including the Tariff,  (ii) contracts with Non-Participants or the System
Operator, and  (iii) related tariffs, rate schedules and certificates of
concurrence.  The Participants Committee shall, in addition, have  the
authority to represent NEPOOL in proceedings before the  Commission.

(e)  The Participants Committee shall have the duty and requisite  authority,
after consultation with other NEPOOL committees and the  System Operator, to
fix the NEPOOL Objective Capability for each  month of each Power Year prior to
the beginning of the Power Year  and thereafter to review at least annually the
anticipated Load of  the NEPOOL Participants and NEPOOL Installed Capability
for each  month of such Power Year and to make such adjustments in the NEPOOL
Objective Capability as the Participants Committee may determine on  the basis
of such review.  Since changes in the circumstances which  must be assumed by
the Participants Committee in fixing NEPOOL  Objective Capability for a future
period can significantly affect  the required level of NEPOOL Objective
Capability for that period,  the Participants Committee shall, where
appropriate, also determine  the effect on NEPOOL Objective Capability of
significant changes in  circumstances from those assumed, either by fixing
alternative  NEPOOL Objective Capabilities, or by adopting adjustment factors
or  formulas.

(f)  The Participants Committee shall have the duty and requisite  authority to
establish or approve schedules fixing the amounts to  be paid by Participants
and Non-Participants to permit the recovery  of expenses incurred in furnishing
some or all of the services  furnished by NEPOOL either directly or through the
System Operator.

(g)  The Participants Committee shall have the duty and requisite  authority to
provide for the sharing by Participants, on such basis  as the Participants
Committee may deem appropriate, of payments and  costs which are not otherwise
reimbursed under this Agreement and  which are incurred by Participants or
under arrangements with Non- Participants and approved or authorized by the
Committee as  necessary in order to meet or avoid short-term deficiencies in
the  amount of resources available to meet the Pool's reliability  objectives.


(h)  The Participants Committee shall have the authority, at the time  that it
acts on an Entity's application pursuant to Section 3.1 to  become a
Participant, to waive, conditionally or unconditionally,  compliance by such
Entity with one or more of the obligations  imposed by this Agreement if the
Participants Committee determines  that such compliance would be unnecessary or
inappropriate for such  Entity and the waiver for such Entity will not impose
an additional  burden on other Participants.

(i)  The Participants Committee shall have the authority to establish  standard
conditions and waivers with respect to applications by  Entities for membership
in NEPOOL and to modify such standard  conditions and waivers as appropriate in
connection with changed  circumstances with respect to such applicants,
provided that the  Participants Committee determines that the standard
conditions and  waivers for such Entities will not impose an additional burden
on  other Participants.

(j)  The Participants Committee shall have the duty and requisite  authority to
act on appeals to it from the actions of other  Principal Committees if
delegated to such Committees by the  Participants Committee pursuant to Section
7.5(k), to appoint the  Review Board, and to appoint a special committee to
administer  NEPOOL's alternate dispute resolution procedures or to take any
other action if it determines that such action is necessary or  appropriate to
achieve a prompt resolution of disputes under the  provisions of Section 21.1.

(k)  The Participants Committee shall have the authority to delegate its
powers and duties to one or more of the Technical Committees, the  System
Operator, or other entity as it sees fit provided that (i)  such delegation is
clearly stated and approved by a Participant  Committee action, (ii) such
delegation does not violate any other  provision set forth herein, and (iii)
the action of such entity on  any matter delegated to it may be appealed by any
Participant to  the Participants Committee provided such an appeal is taken
prior  to the end of the tenth business day following the action of the
Technical Committee, the System Operator, or such entity by giving  to the
Secretary of the Participants Committee a signed and written  notice of appeal,
a copy of which the Secretary shall provide to  the System Operator and each
member and alternate of the  Participants Committee.  Pending action on the
appeal by the  Participants Committee, the giving of a notice of appeal as
aforesaid shall suspend the action appealed from.

(l)  The Participants Committee shall have the duty and requisite  authority to
establish the NEPOOL Information Policy.

(m)  The Participants Committee shall have the duty and requisite  authority to
adopt and approve, amend and approve or resubmit to  one or more Technical
Committees for additional comment, any matter  submitted to the Participants
Committee by a Technical Committee.

(n)  The Participants Committee shall have such further powers and  duties as
are conferred or imposed upon it by other sections of  this Agreement.

7.6  Attendance of Participants at Committee Meeting.  Each Participant which
does not have the right to designate an individual voting member of the
Participants Committee shall, with the exception of meetings held  pursuant to
Section 11B.9 and meetings in executive session pursuant to  Section 11B.10, be
entitled to attend any meeting of the Committee or  any other NEPOOL committee,
and shall have a reasonable opportunity to  express views on any matter to be
acted upon at the meeting.

7.7  Appeal of Actions to Review Board.  Any Participant which otherwise has
the ability to submit a matter for resolution under Section 21.1 may, in  lieu
of submitting a dispute as to a Participants Committee action or  failure to
take action for resolution pursuant to Section 21.1, appeal  such matter to the
Review Board.  Except as otherwise provided in  Section 6.11, such an appeal
shall be taken prior to the end of the  tenth business day following the
meeting of the Participants Committee  to which the appeal relates by giving to
the Secretary of the  Participants Committee by hand delivery, facsimile,
electronic mail or  regular mail a signed and written notice of appeal, a copy
of which the  Secretary shall provide to each Participant.  If no appeal of a
Participants Committee action or failure to take action is taken, and  the
action or failure to take action is not submitted for resolution  pursuant to
Section 21.1, within such time period, that Participants  Committee action or
failure to take action shall be final and effective.   If an appeal is taken,
pending action on the appeal by the Review  Board, the giving of a notice of
appeal as aforesaid shall suspend the  action appealed from. To the extent any
action taken relates to the  approval of a rule or procedure which must be
filed with the Commission,  the rule or procedure shall not be filed until the
time for appeal or  submission for dispute resolution has elapsed and, if an
appeal has been  filed or submission for dispute resolution has been made,
either (i) a  decision on the appeal has been issued by the Review Board, or
(ii) the  earlier of resolution pursuant to Section 21.1 of the matter
submitted  for dispute resolution or the termination pursuant to Section
21.1.B(2)  of the suspension effect of such submission.

SECT65535ON 8

RELIABILITY COMMITTEE

8.1  Officers.  The Reliability Committee shall have a Chair, Vice-Chair and
Secretary.  The Chair and Secretary of the Reliability Committee shall  be
appointed by the System Operator from time to time in accordance with  Section
20(j).  The Chair will be responsible for presiding at meetings  of the
Committee and establishing agendas for its meetings in  conjunction with the
Vice-Chair and shall have the powers and duties as  set forth in the Committee
bylaws.  The Secretary shall have the powers  and duties usually incident to
such office and as set forth in the  Committee bylaws.  The Chair and Secretary
shall have no voting rights.   The Vice-Chair shall be elected by the
Reliability Committee from among  its voting members from time to time.  The
Vice-Chair shall have the  powers and duties usually incident to such office
and such powers and  duties as set forth in the Committee bylaws, including,
without  limitation, the responsibility to develop in conjunction with the
Chair,  Committee meeting agendas.

8.2  Notice to Members and Alternates of Participants Committee.  Prior to  the
end of the fifth business day following a meeting of the Reliability
Committee, the Secretary of the Reliability Committee shall give written
notice to the System Operator and each member and alternate of the
Participants Committee of any action taken by the Reliability Committee  at
such meeting.

8.3  Voting; Appeal of Actions.  Votes taken by the Reliability Committee
shall be binding on the Participants only for those matters in which the
Committee has specifically designated authority under this Agreement or  has
been properly delegated authority by the Participants Committee  pursuant to
Section 7.5(k).

Any Participant may appeal to the Participants Committee any binding  action
taken by the Reliability Committee.  Such an appeal shall be  taken prior to
the end of the tenth business day following the meeting  of the Reliability
Committee to which the appeal relates by giving to  the Secretary of the
Participants Committee a signed and written notice  of appeal, a copy of which
the Secretary shall provide to the System  Operator and each member and
alternate of the Participants Committee.   Pending action on the appeal by the
Participants Committee, the giving  of a notice of appeal as aforesaid shall
suspend the action appealed  from.

8.4  Responsibilities.  The Reliability Committee shall perform the following
functions, in conjunction with the System Operator as appropriate, and  shall
recommend action to the System Operator, Participants Committee or
Transmission Owners, as appropriate, with respect thereto:

(a)  provide input to the Participants Committee, Transmission Owners,  and
System Operator, as appropriate, on transmission facilities and  the
development of a regional transmission plan in order to achieve  the objectives
of NEPOOL;

(b)  following appropriate study, recommend NEPOOL Objective Capability  for
each Power Year;

(c)  periodically review the procedures used to calculate NEPOOL  Installed
Capability, NEPOOL Objective Capability and NEPOOL  Capability Responsibility;

(d)  periodically prepare short and long term load forecasts for use in  NEPOOL
studies and operations and to meet requirements of  regulatory agencies;

(e)  review communications and liaison arrangements between NEPOOL and
governmental authorities on power supply, environmental, load  forecasting, and
transmission issues;

(f)  coordinate the collection and exchange of necessary system data and
future plans related to reliability for use in NEPOOL planning and  to meet
requirements of regulatory agencies;

(g)  coordination of studies of, and provide information to Participants  on,
maintenance schedules for the supply and demand-side resources  and
transmission facilities of the Participants;

(h)  based on appropriate studies, recommend for Participants Committee
approval Reliability Standards to assure the reliable operation and  facilitate
the efficient operation of the NEPOOL Control Area bulk  power system and those
operating rules which guide the  implementation of the Reliability Standards.
Such Reliability  Standards and operating rules shall include, without
limitation,  the following:

(i)  standards to determine the current Annual Peak, Adjusted  Annual Peak,
Monthly Peak, Adjusted Monthly Peak, and  aggregate obligations of the
Participants in each of the  NEPOOL Markets;

(ii) standards to establish short and long term load forecasts for  use in
NEPOOL operations and to meet requirements of  regulatory agencies;

(iii)     standards with respect to the administration and  enforcement of, and
reporting pursuant to, NERC and NPCC  policies and requirements;

(iv) standards for use in planning and design of the NEPOOL  interconnected
bulk power system;

(v)  standards to ensure the continuous reliability of the bulk  power
transmission system, such standards to include, without  limitation, criteria
and rules relating to protective  equipment, transfer limits, voltage
schedules, voltage guides,  operating guides, sub-area reserves, switching,
voltage  control, load shedding, emergency and restoration procedures,  and the
coordination of scheduling of the operation and  maintenance of supply and
demand-side resources and  transmission facilities of the Participants;

(vi) standards for determining the capabilities of each electric  generating
unit or combination of units in which a Participant  has an Entitlement in a
uniform manner applying generally  accepted engineering principles; and

(vii)     as appropriate, reliability standards for interpool  coordination
transactions.

(i)  review proposed supply and demand-side resource plans and the  proposed
transmission and interconnection plans of Participants  pursuant to Section
18.4 and, based on such review, recommend  action regarding such proposed
plans.

(j)  make recommendations regarding procedures for dispatch  infrastructure
(i.e. voice and data communications protocols, AGC  pulsing arrangements,
Energy Management System and System Control  and Data Acquisition interfaces,
Satellite relations, etc.);

(k)  provide input and make recommendations with respect to the  reliability
considerations of general system operations (i.e.  commitment/ decommitment,
real time dispatch, review and approval  of distribution of reserves, etc.);

(l)  recommend to the Participants Committee the retention of a  consultant,
procurement of computer time, or the incurrence of  consultant expenses or such
other expenses as may be required to  enable the Reliability Committee, its
subcommittees, and task  forces properly to perform their duties;

(m)  make recommendations to the Participants Committee, Transmission  Owners,
and System Operator, as appropriate, with respect to  development and amendment
of interconnection procedures and  documents related to such procedures;

(n)  to the extent appropriate, develop criteria, guidelines and  methodologies
to assure consistency in monitoring and assessing  conformance of Participant
and regional transmission plans to  accepted reliability criteria.

8.5  Establishment of Subcommittees and Task Forces.  The Reliability
Committee shall have the authority to establish subcommittees and task  forces
for particular studies.

8.6  Further Powers and Duties.  The Reliability Committee shall have such
further powers and duties as are consistent with the duties and
responsibilities set forth herein or as may be properly delegated to it  by the
Participants Committee.

SECT65535ON 9

TARIFF COMMITTEE

9.1  Officers.  The Tariff Committee shall have a Chair, Vice-Chair and
Secretary.  The Chair and Secretary of the Tariff Committee shall be  appointed
by the System Operator from time to time in accordance with  Section 20(j).
The Chair will be responsible for presiding at meetings  of the Committee and
establishing agendas for its meetings in  conjunction with the Vice-Chair and
shall have the powers and duties as  set forth in the Committee bylaws.  The
Secretary shall have the powers  and duties usually incident to such office and
as set forth in the  Committee bylaws.  The Chair and Secretary shall have no
voting rights.   The Vice-Chair shall be elected by the Tariff Committee from
among its  voting members from time to time. The Vice-Chair shall have the
powers  and duties usually incident to such office and such powers and duties
as  set forth in the Committee bylaws, including, without limitation, the
responsibility to develop in conjunction with the Chair, Committee  meeting
agendas.

9.2  Notice to Members and Alternates of Participants Committee.  Prior to  the
end of the fifth business day following a meeting of the Tariff  Committee, the
Secretary of the Tariff Committee shall give written  notice to the System
Operator and each member and alternate of the  Participants Committee of any
action taken by the Tariff Committee at  such meeting.

9.3  Voting; Appeal of Actions. Votes taken by the Tariff Committee shall be
binding on the Participants only for those matters in which the  Committee has
specifically designated authority under this Agreement or  has been properly
delegated authority by the Participants Committee  pursuant to Section 7.5(k).

Any Participant may appeal to the Participants Committee any binding  action
taken by the Tariff Committee.  Such an appeal shall be taken  prior to the end
of the tenth business day following the meeting of the  Tariff Committee to
which the appeal relates by giving to the Secretary  of the Participants
Committee a signed and written notice of appeal, a  copy of which the Secretary
shall provide to the System Operator and  each member and alternate of the
Participants Committee.  Pending action  on the appeal by the Participants
Committee, the giving of a notice of  appeal as aforesaid shall suspend the
action appealed from.

9.4  Responsibilities. The Tariff Committee shall perform the following
functions, in conjunction with the System Operator as appropriate, and  shall
recommend action to the System Operator, Participants Committee or
Transmission Owners, as appropriate, with respect thereto:

(a)  develop appropriate billing procedures for transmission and  ancillary
services pursuant to this Agreement and the Tariff;

(b)  develop and recommend to the Participants Committee and the  Transmission
Owners Committee, as appropriate, (i) amendments,  additions and other changes
to the Tariff and (ii) related Tariff  rules;

(c)  providing input to the System Operator on the development of
Administrative Procedures with respect to the administration of the  Tariff and
the OASIS;

(d)  to the extent appropriate, conduct and/or review such studies and  make
such determinations as are assigned to the Committee pursuant  to this
Agreement and the Tariff with respect to financial  treatment of additions to
or upgrades of PTF;

(e)  recommend to the Participants Committee the retention of a  consultant,
procurement of computer time, or the incurrence of  consultant expenses or such
other expenses as may be required to  enable the Tariff Committee, its
subcommittees, and task forces  properly to perform their duties.

9.5  Establishment of Subcommittees and Task Forces.  The Tariff Committee
shall have the authority to establish subcommittees and task forces for
particular studies.

9.6  Further Powers and Duties.  The Tariff Committee shall have such further
powers and duties as are consistent with the duties and responsibilities  set
forth herein or as may be properly delegated to it by the  Participants
Committee.

SECT65535ON 10

MARKETS COMMITTEE

10.1 Officers.  The Markets Committee shall have a Chair, Vice-Chair and
Secretary.  The Chair and Secretary of the Markets Committee shall be
appointed by the System Operator from time to time in accordance with  Section
20(j).  The Chair will be responsible for presiding at meetings  of the
Committee and establishing agendas for its meetings in  conjunction with the
Vice-Chair and shall have the powers and duties as  set forth in the Committee
bylaws.  The Secretary shall have the powers  and duties usually incident to
such office and as set forth in the  Committee bylaws.  The Chair and Secretary
shall have no voting rights.   The Vice-Chair shall be elected by the Markets
Committee from among its  voting members from time to time.  The Vice-Chair
shall have the powers  and duties usually incident to such office and such
powers and duties as  set forth in the Committee bylaws, including, without
limitation, the  responsibility to develop in conjunction with the Chair,
Committee  meeting agendas.

10.2 Notice to Members and Alternates of Participants Committee.  Prior to  the
end of the fifth business day following a meeting of the Markets  Committee,
the Secretary of the Markets Committee shall give written  notice to the System
Operator and each member and alternate of the  Participants Committee of any
action taken by the Markets Committee at  such meeting.

10.3 Voting; Appeal of Actions. Votes taken by the Markets Committee shall be
binding on the Participants only for those matters in which the  Committee has
specifically designated authority under this Agreement or  has been properly
delegated authority by the Participants Committee  pursuant to Section 7.5(k).

Any Participant may appeal to the Participants Committee any binding  action
taken by the Markets Committee.  Such an appeal shall be taken  prior to the
end of the tenth business day following the meeting of the  Markets Committee
to which the appeal relates by giving to the Secretary  of the Participants
Committee a signed and written notice of appeal, a  copy of which the Secretary
shall provide to the System Operator and  each member and alternate of the
Participants Committee.  Pending action  on the appeal by the Participants
Committee, the giving of a notice of  appeal as aforesaid shall suspend the
action appealed from.

10.4 Responsibilities. The Markets Committee shall perform the following
functions, in conjunction with the System Operator as appropriate, and  shall
recommend action to the System Operator, Participants Committee or
Transmission Owners, as appropriate, with respect thereto:

(a)  based on appropriate studies, develop market procedures to assure  the
reliable operation and facilitate the efficient operation of  the NEPOOL
Control Area bulk power supply;

(b)  (i) evaluate studies of the market implications of maintenance  schedules
for the supply and demand-side resources and transmission  facilities of the
Participants and operable capacity margins, and  (ii) develop market procedures
for scheduling maintenance for  supply and demand resources and transmission
resources.

(c)  to the extent appropriate to assure the efficient operation of the  NEPOOL
Markets, develop reasonable standards, criteria and rules  relating to
protective equipment, switching, voltage control, load  shedding, emergency and
restoration procedures, and the operation  and maintenance of supply and
demand-side resources and  transmission facilities of the Participants;

(d)  develop procedures for determining the market implications of the
seasonal capabilities of each electric generating unit or  combination of units
in which a Participant has an Entitlement;

(e)  develop procedures for determining as appropriate from time to time  the
current Annual Peak, Adjusted Annual Peak, Monthly Peak,  Adjusted Monthly
Peak, Installed Capability Responsibility, and  obligations for Energy,
Operating Reserve and AGC of each  Participant;

(f)  develop Market Rules and periodically review and recommend changes
thereto as appropriate.  Such Market Rules shall include, without  limitation,
the following:

(i)  submission of Bid Prices and the determination of prices for  each of the
NEPOOL Markets;

(ii) determination for each Participants of its obligations under  each of the
NEPOOL Markets;

(iii)     establishment or approval of appropriate billing  procedures for
market transactions pursuant to this Agreement;

(iv) calculation and equitable apportionment of losses incurred in  connection
with Interchange Transactions; and

(v)  interpool market contract coordination as appropriate.

(g)  develop operating procedures relating to the administration of the  NEPOOL
Markets and periodically review and recommend changes  thereto as appropriate;

(h)  recommend the retention of a consultant, procurement of computer  time, or
the incurrence of consultant expenses or such other  expenses as may be
required to enable the Markets Committee, its  subcommittees, and task forces
properly to perform their duties.

10.5 Establishment of Subcommittees and Task Forces.  The Markets Committee
shall have the authority to establish subcommittees and task forces for
particular studies.

10.6 Further Powers and Duties.  The Markets Committee shall have such  further
powers and duties as are consistent with the duties and  responsibilities set
forth herein or as may be properly delegated to it  by the Participants
Committee.

10.7 Development of Rules Relating to Non-Participant Supply and Demand-side
Resources.  It is recognized that arrangements between Participants and  Non-
Participants with respect to the Non-Participants' supply and  demand-side
resources may create special problems in the application of  Sections 12 and
14.  Accordingly, the Markets Committee shall analyze  such special problems
and recommend to the Participants Committee  appropriate rules for reflecting
such resources in the Installed System  Capability of a Participant which
enters into such an arrangement and  for the treatment of such arrangements for
Energy, Operating Reserve and  AGC purposes.  Upon approval by the Participants
Committee, such rules  shall supersede the provisions of Sections 12 and 14
(and the related  definitions in Section 1) to the extent of any conflict
therewith upon  acceptance by the Commission.

SECT65535ON 11

FURTHER RESTRUCTURING

The NEPOOL Participants undertake to finalize by March 31, 2000 the
negotiation of more comprehensive arrangements for the reassignment of
appropriate administrative responsibilities to the System Operator in the
Interim ISO Agreement.

SECTION 11A

REVIEW BOARD

11A.1     Organization.  There shall be a Review Board which, in addition to
responsibility under Section 11B.12, shall be responsible for ruling on
appeals taken from actions of the Participants Committee and for  advising the
Participants Committee as to the issues raised on any  appeals before it
provided that appeals from actions of the System  Operator shall not be taken
to the Review Board.  In ruling on appeals,  the Review Board shall consider,
among other things, whether the action  is consistent with Commission policies.
In addition, if the appeal  relates to an amendment to the Agreement or market
rule, the Review  Board shall consider the extent to which such amendment
imposes a burden  on the Participants which do not vote in favor of the
amendment that is  materially greater in degree than that imposed on the
Participants which  have voted in favor of the amendment.  The Review Board
shall not have  the right to review or otherwise participate in actions of the
System  Operator or to take any action with respect to any matter involving a
dispute between the System Operator and either NEPOOL or any  Participant.  The
Participants agree that the process of selecting the  Review Board shall
commence upon the initial formation of the  Participants Committee. Until the
initial organization of the Review  Board is completed, the Board of Directors
of the System Operator or a  committee thereof consisting of not less than
three System Operator  Directors designated by the System Operator Board of
Directors shall  perform the functions of the Review Board, provided that the
provisions  of Sections 11A.2 through 11A.6 shall not be applicable to the
Board of  Directors of the System Operator acting as a Review Board.  All
expenses  incurred by the System Operator as a result of the Board of Directors
in  acting as the Review Board shall be NEPOOL expenses.

11A.2     Composition.  The Review Board shall be composed of five members.
The Review Board Members shall initially be selected by the Participants
Committee from a slate of candidates.  An independent consultant,  retained by
the Participants Committee, shall prepare a list of persons  qualified and
willing to serve on the Review Board.  A subcommittee  appointed by the
Participants Committee shall review the list and  distribute to the members of
the Participants Committee a slate from  among the list proposed by the
independent consultant, along with  information on the background and
experience of the persons on the slate  appropriate to evaluating their fitness
for service on the Review Board.   If the Participants Committee fails to
select a full Review Board from  the slate proposed by the subcommittee, the
Committee shall direct the  independent consultant to propose a further list of
nominees for  consideration at the next regular meeting of the Participants
Committee.   Thereafter, prior to the expiration of a Review Board Member's
term,  and upon the occurrence of any vacancy on the Board, the Participants
Committee shall select a successor Member.

11A.3     Qualifications.  The Review Board Members shall be independent
experts knowledgeable about issues typically faced by entities engaged  in
energy production, transmission, distribution and sale under Federal  or State
regulation.  A Review Board Member shall not be, and shall not  have been at
any time within five years of election to the Review Board,  a director,
officer or employee of a Participant or of a Related Person  of a Participant.
While serving on the Review Board, a Review Board  Member shall have no direct
business relationship or other affiliation  with any Participant or its Related
Persons and shall otherwise be  subject to the same independence requirements
imposed on Directors of  the System Operator Board of Directors.

11A.4     Term.  A Review Board Member shall serve for a term of three years;
provided, however, that two of the Review Board Members selected  initially
shall be chosen by lot to serve a term of two years, two of  the Review Board
Members selected initially shall be chosen by lot to  serve a term of three
years and the other Review Board Member selected  initially shall serve a term
of four years.

11A.5     Meetings.  Meetings of the Review Board may be conducted in person
or by telephone or other electronic means by means of which all persons
participating in the meeting can communicate in real time with each  other.

11A.6     Bylaws.  To the extent not inconsistent with any provision of this
Agreement, the Participants Committee shall adopt bylaws establishing
procedures for the Review Board's activities as it may deem appropriate,
including but not limited to bylaws governing the scheduling, noticing  and
conduct of meetings of the Review Board, a code of conduct,  selection of a
Chair and Vice-Chair of the Review Board, and action by  the Review Board
without a meeting.  Such bylaws shall not modify or be  inconsistent with any
of the rights or obligations established by this  Agreement.

11A.7     Procedure on Appeal of Participant Committee Action or Failure to
Take Action.

(a)  Submission of an Appeal:  A Participant seeking review ("Appealing
Party") by the Review Board of action of the Participants Committee  shall give
written notice of the appeal in accordance with Section  7.7, and the appeal
shall have the suspension effect specified in  Section 7.7.

(b)  Intervenors and Time Limits:  Any other Participant that wishes to
participate in the appeal proceeding hereunder shall give signed  written
notice to the Secretary of the Participants Committee no  later than ten (10)
business days after the Appealing Party has  given notice of appeal and shall
upon the approval of the Review  Board be permitted to participate in the
appeal.

(c)  Procedural Rules:  The procedural rules (if any), for the conduct  of the
appeal shall be determined by the Review Board in  consultation with the
Participants Committee and each Appealing  Party on a case-by-case basis.

(d)  Pre-hearing Submissions:  Each Appealing Party shall provide the  Review
Board, within 15 days of the giving of its notice of appeal  or such other time
as permitted by the Review Board, a brief  written statement of its complaint
and a statement of the remedy or  remedies it seeks, accompanied by copies of
any documents or other  materials it wishes the Review Board to review.  The
Participants  Committee and, as appropriate, any other Participant
participating  in the appeal will provide the Review Board, within 10 days of
the  Appealing Party's submission or such other time as permitted by the
Review Board, copies of the minutes of all NEPOOL committee  meetings at which
the matter was discussed and if deemed  appropriate by the Participants
Committee or otherwise requested by  the Review Board a brief description of
the action (or failure to  act) being appealed and a brief statement explaining
why the  Participants Committee believes its action (or failure to act)  should
be upheld by the Review Board, together with copies of  documents or other
materials referenced in such submission for the  Review Board to review and
materials, if any, which interested  Participants provide to the Secretary of
the Participants Committee  and reasonably request be submitted to the Review
Board.

In addition, each party shall designate one or more individuals to  be
available to answer questions the Review Board may have on the  documents or
other materials submitted.  The answers to all such  questions shall be reduced
to writing by the party providing the  answer and a copy shall be made
available to any requesting  Participant.

(e)  Hearing: A hearing (if any) will be held as soon as is reasonably
practicable.

(f)  Decision: The Review Board's decision, to the extent practicable,  shall
be due, within ninety (90) days of the giving of notice of  the appeal.

11A.8     Effect of a Review Board Decision.

(a)  Each Review Board Member shall have one vote and a decision of the  Review
Board, either to grant or deny an appeal, shall require  affirmative votes by a
majority of the Review Board Members but not  less than three (3) such Members.


(b)  (i)  Appeal denied.  If the Review Board denies the appeal, the  action of
the Participants Committee will be final and  effective, subject to Commission
acceptance if and as  required.

(ii) Appeal granted.  If the Review Board grants the appeal, the  Review
Board's determination (granting the appeal) will be  final and the action of
the Participants Committee shall not  take effect.

(c)  If the Review Board grants an appeal, the Review Board may submit a
proposed resolution of the matter that was the subject of the  appeal to the
Participants Committee.  The Participants Committee  may, but is not required
to, take further action with regard to the  matter.  If the Participants
Committee votes on an action regarding  the matter (including a vote not to act
on the matter), the action  or non-action of the Participants Committee shall
be subject to  further appeal by any Participant to the Review Board in
accordance  with Section 7.7.  Any proposed resolution that the Review Board
submits to the Participants Committee is advisory only.

11A.9     An action or failure to act once appealed by a Participant to the
Review Board may not be subject to the alternative dispute resolution
provisions of Section 21.1, regardless of the outcome of the appeal.
Conversely, an action or failure to act submitted for resolution by a
Participant pursuant to Section 21.1 may not be brought before the  Review
Board.  If more than one Participant appeals and/or submits for  alternative
dispute resolution under Section 21.1 the same issue, the  Participant that
first takes such action shall determine whether the  issue is to be heard by
the Review Board or considered under Section  21.1; provided that each
Participant challenging an action or failure to  take action shall have the
same opportunity to present its case and may  not be excluded from
participating under Section 11A.7(b).

11A.10 Any action taken or failure to take action by the Review Board does  not
restrict or limit in any way the rights of a Participant to seek review by the
Commission, or a review in any other forum available to the Participant  and
there shall be no requirement to submit an appeal to the Review  Board
concerning any amendment, action or inaction by the Participants  Committee
prior to a Participant exercising any such rights to seek  review by the
Commission or any other forum with jurisdiction.

11A.11 The Review Board may not take action that is inconsistent with or
infringes upon any of the rights set forth in Section 17A.

SECTION 11B

TRANSMISSION OWNERS COMMITTEE

11B.1     Organization.  There shall be a Transmission Owners Committee
established pursuant to this Section 11B which shall implement the  rights
reserved to Transmission Owners by Section 17A.

11B.2     Membership.  Membership on the Transmission Owners Committee shall
be open to all Transmission Owners, regardless of their individual  choices in
Sector membership under Section 6.2.

11B.3     Appointment of Members and Alternates. A Transmission Owner shall
join the Transmission Owners Committee by written notice delivered to  the
Secretary of the Transmission Owners Committee, and shall designate  in the
notice the initial member appointed by it for the Committee and  an alternate
of the member.  In the absence of the member, the alternate  shall have all the
powers of the member, including the power to vote.

11B.4     Term of Members.  A member of the Transmission Owners Committee
appointed by a Transmission Owner shall serve until replaced by the
Transmission Owner which appointed it or until such Transmission Owner  ceases
to be a Participant or otherwise lose its right to appoint the  member.
Appointment or replacement of a member shall be effected by a  Transmission
Owner by giving written notice of such appointment or  replacement to the
Secretary of the Transmission Owners Committee.

11B.5     Regular and Special Meetings.  The Transmission Owners Committee
shall hold its annual meeting in December or January at such time and  place as
the Chair shall designate and shall hold other meetings in  accordance with a
schedule adopted by the Committee or at the call of  the Chair.  Thirty percent
(30%) or more of the voting members of the  Transmission Owners Committee may
call a special meeting of the  Committee in the event that the Chair shall fail
to call such a meeting  within three business days following the Chair's
receipt from such  members of a request specifying the subject matters to be
acted upon at  the meeting.

11B.6     Notice of Meetings.  Written notice of each meeting of the
Transmission Owners Committee shall be given to each Transmission Owner  and to
other Participants not less than five (5) business days prior to  the date of
the meeting.

11B.7     Attendance.  Regular and special meetings may be conducted in
person, by telephone, or other electronic means by means of which all  persons
participating in the meeting can communicate in real time with  each other.  In
order to vote during the course of a meeting, attendance  is required in person
or by telephone or other real time electronic  means by a voting member or its
alternate or a duly designated agent who  has been given, in writing, the
authority to vote for the member on all  matters or the proxy to vote for the
member on specific matters.

11B.8     Votes. Any action taken by the Transmission Owners Committee shall
require the concurrence of:

(i)  representatives of at least two-thirds of the Transmission Owners
provided that Transmission Owners that are Related Persons to one  another
shall together have a single vote; and

(ii) representatives of Transmission Owners having at least two-thirds  of the
Weighted Votes of all Transmission Owners, where each  Transmission Owner's
Weighted Vote is equal to its original capital  investment in its PTF as of the
end of the most recent year for  which figures are available.

Notwithstanding the foregoing, if a vote is taken and paragraph (i)  above is
satisfied but paragraph (ii) above is not, the action being  voted on by the
Transmission Owners Committee shall pass if (1) there  are seven or more
Transmission Owners on the Committee and fewer than  three Transmission Owners
oppose the action or (2) there are less than  seven Transmission Owners on the
Committee and only one Transmission  Owner opposes the action.

11B.9     Appointment of Task Forces or Working Groups.  The Transmission
Owners Committee shall have the authority to appoint task forces or  working
groups to address matters for which the Committee is  responsible.
Notwithstanding Section 7.6, such tasks force or working  groups may be limited
to Transmission Owners only.

11B.10 Officers.  At its annual meeting, the Transmission Owners Committee
shall elect from its members a Chair and a Vice-Chair; it shall also elect a
Secretary who need not be a member of the Committee.  These officers  shall
have the powers and duties usually incident to such offices,  including the
right to convene an executive session of the Transmission  Owners Committee to
consider and vote upon submittals to the Commission  or litigation strategy.

11B.11 Adoption of Bylaws.  The Transmission Owners Committee may adopt
bylaws, consistent with this Agreement, governing procedural matters including
the conduct of its meetings.

11B.12 Review of Committee Actions.  To the extent the Commission determines,
pursuant to Section 17A.7, that Transmission Owners have the exclusive  right
to make unilateral filings under Section 205 of the Federal Power  Act, a
Transmission Owner may either submit a dispute for resolution  pursuant to
Section 21.1 or appeal to the Review Board any action taken  by the
Transmission Owners Committee with respect to such a Section 205  filing.  Such
a submission or appeal shall be taken prior to the end of  the tenth business
day following the meeting of the Transmission Owners  Committee to which the
submission or appeal relates by giving to the  Secretary of the Transmission
Owners Committee a signed and written  notice of submission or appeal.  Pending
action on an appeal by the  Review Board, the giving of a notice of appeal as
aforesaid shall  suspend the action appealed from.  For purposes of the
application of  the dispute resolution process of Section 21.1 and the
suspension effect  of a submission to alternative dispute resolution, Section
21.1 shall be  applied as if the Transmission Owners Committee were the
Participants  Committee.

SECTION 11C

LIAISON COMMITTEE

11C.1     Organization; Duties.  There shall be a Liaison Committee which
shall be an advisory committee only responsible to act as a steering  committee
for managing NEPOOL business through the committee process and  facilitating
communications between NEPOOL and the System Operator and  among Participants.
The Liaison Committee's duties as a steering  committee include, without
limitation, recommending that matters be  assigned to particular committees for
action where the subject matter of  a proposed rule or other action potentially
falls in the purview of more  than one committee and assuring appropriate input
from other committees  as needed.

11C.2     Membership.  The Liaison Committee shall have the following  members:
the Chair and Vice-Chair of each of the Principal Committees;  the Chair of the
Transmission Owners Committee; a Participant  representative of each Sector
that is not otherwise represented on the  Liaison Committee; the chief
executive officer of the System Operator;  and two members of the System
Operator's Board of Directors.

11C.3     Regular and Special Meetings.  The Liaison Committee shall hold
meetings in accordance with a schedule adopted by the Committee or at  the call
of the Co-Chairs.

11C.4     Notice of Meetings.  Written notice of each meeting of the Liaison
Committee shall be given to each member of the Committee and all members  of
the Participants Committee not less than five business days prior to  the date
of the meeting.

11C.5     Attendance.  Regular and special meetings may be conducted in
person, by telephone, or other electronic means by means of which all  persons
participating in the meeting can communicate in real time with  each other.
Participants Committee members and alternates may attend  meetings of the
Liaison Committee.  Any individual that is not a member  of the Liaison
Committee may participate at a meeting at the invitation  of a Co-Chair.

11C.6     Officers.  The Co-Chairs of the Liaison Committee shall be the  chief
executive officer of the System Operator and the Chair of the  Participants
Committee.  The Liaison Committee shall elect a Secretary  who need not be a
member of the Committee.  These officers shall have  the powers and duties
usually incident to such offices.

PART THREE

MARKET PROVISIONS

SECT65535ON 12

INSTALLED CAPABILITY OBLIGATIONS AND PAYMENTS

12.1 Obligations to Provide Installed Capability.

(a)  Each Participant shall have Installed System Capability during each  hour
of each month at least sufficient to satisfy its Installed  Capability
Responsibility for the month.

(b)  [Deleted].

12.2 Computation of Installed Capability Responsibilities.

(a)  (1)  At the conclusion of each month, the System Operator under the
direction of the Participants Committee shall determine each  Participant's
tentative Installed Capability Responsibility in  Kilowatts for such month in
accordance with the following  formula:

    X   = (P(A-N)+Np)(1+T) - C(Dp)

As used in this Section 12.2(a)(1), the symbols used in the  formula and the
additional symbols defined below have the  following meanings:

X    is the Participant's tentative Installed Capability  Responsibility for
the month.

P    is the value of the Participant's fraction for the month  as determined in
accordance with the following formula:

P =  (Fp + Dp) / (F + D), wherein:

Fp   is the Participant's Adjusted Monthly Peak for the  month less any
Kilowatts received by such  Participant pursuant to a contract of a type that
traditionally has been treated by NEPOOL as a firm  contract for the purposes
of this Section prior to  January 1, 1999, but which does not constitute a
Firm Contract as defined in this Agreement.

Dp   is the Participant's actual or potential load  reduction resulting from
its NEPOOL Interruptible  and Dispatchable Loads for the month.

F    is the aggregate for the month of the Adjusted  Monthly Peaks for all
Participants less any  Kilowatts received by any Participant pursuant to a
contract of a type that traditionally has been  treated by NEPOOL as a firm
contract for the  purposes of this Section prior to January 1, 1999,  but which
does not constitute a Firm Contract as  defined in this Agreement.

D    is the aggregate for the month of the actual or  potential load reduction
resulting from all  Participants' NEPOOL Interruptible and Dispatchable  Loads.

C    is the factor, which when multiplied by D in megawatts,  results in the
reduction to NEPOOL Objective Capability  that would result from including D in
the determination  of NEPOOL Objective Capability.  The value for C shall be
adopted by the Participants Committee each time it fixes  NEPOOL Objective
Capability pursuant to Section 7.6(e).

A    is the NEPOOL Objective Capability in megawatts for the  month as fixed by
the Participants Committee pursuant to  Section 7.

N    is the aggregate of the New Unit Adjustments for all  Participants for the
month as determined by the  Participants Committee in accordance with Section
12.2(a)(2).

Np   is the aggregate of the Participant's New Unit  Adjustments for the month,
as determined by the  Participants Committee, and is equal to the aggregate of
the Participant's adjustments for each New Unit included  in its Installed
System Capability during the hour of the  coincident peak load of the
Participants for the month.   The Participant's adjustment for each New Unit
may be  positive or negative and shall be the product of (i) the  Participant's
Installed Capability Entitlement in the New  Unit during the hour of the
coincident peak load of the  Participants for the month, times (ii) the New
Unit  Adjustment Factor applicable to the New Unit as  determined in accordance
with Section 12.2(a)(2).

T    is the Participant's Unit Availability Adjustment Factor  for the month.
T may be positive or negative and shall  be determined in accordance with the
following formula:

  T = (I-H) x J x R, wherein:

100

I    for the Participant for the month is the percentage which  represents the
weighted average (using the Installed  Capability of each Installed Capability
Entitlement for  such month for the weighting) of the Four Year Installed
Capability Target Availability Rates of the Installed  Capability Entitlements
which are included in the  Participant's Installed System Capability during the
hour  of the coincident peak load of the Participants for the  month.  The Four
Year Target Availability Rate for an  Installed Capability Entitlement for any
month is the  average of the monthly Target Availability Rates for the
forty-eight months which comprise the period of four  consecutive calendar
years ending within the Power Year  which includes such month, as determined on
the basis of  the Target Availability Rates for each of the forty-eight
months, and as applied on a basis which is consistent  with the fuel or
maturity status of the unit for each of  the forty-eight months; provided,
however, that for the  purpose of determining the Four Year Target Availability
Rate (i) for months included within the Power Year which  commences June 1,
1999, the determination shall be made  for the months of June through October
on the basis of  the calendar years 1995 through 1998, and shall be made  for
the months of November through May on the basis of  the calendar years 1996
through 1999, and (ii) for months  included within the Power Year which
commences June 1,  2000, the determination shall be made on the basis of the
calendar years 1996 through 1999.  The Target  Availability Rates shall be
those utilized by the  Participants Committee in its most recent determination
of NEPOOL Objective Capability pursuant to Section 7.

H    for the Participant for the month is the percentage which  represents the
weighted average (using the Installed  Capability of each Installed Capability
Entitlement for  such month for the weighting) of the Four Year Actual
Availability Rates of the Installed Capability  Entitlements which are included
in the Participant's  Installed System Capability during the hour of the
coincident peak load of the Participants for the month.   The Four Year Actual
Availability Rate for an Installed  Capability Entitlement for any month is the
percentage  which represents the average of the amounts determined  for H1 for
the four applicable Twelve-Month Measurement  Periods within the forty-eight
months which comprise the  period of four consecutive calendar years ending
within  the Power Year which includes such month; provided,  however, that for
the purpose of determining the Four  Year Actual Availability Rate (i) for
months included  within the Power Year which commences June 1, 1999, the
determination shall be made for the months of June  through October on the
basis of the calendar years 1995  through 1998, and shall be made for the
months of  November through May on the basis of the calendar years  1996
through 1999, and (ii) for months included within  the Power Year which
commences June 1, 2000, the  determination shall be made on the basis of the
calendar  years 1996 through 1999.  A Twelve-Month Measurement  Period is a
period of twelve sequential months.  For  purposes of this sequence, the first
month in the four  years and the immediately succeeding months shall be
considered to follow the forty-eighth month in the four- year period.  The four
applicable Twelve-Month  Measurement Periods to be used in the determination of
H1  for an Installed Capability Entitlement shall be the four  sequential
Twelve-Month Measurement Periods out of the  twelve possible combinations which
yield the highest H1.

H1   for an Installed Capability Entitlement in a unit or  combination of units
for a Twelve-Month Measurement  Period is its Actual Availability Rate.  The
Actual  Availability Rate of an Installed Capability Entitlement  for a
Twelve-Month Measurement Period is a percentage and  shall be the greater of:

(i)  the percentage of (a) the amount of generation which  could have been
received with respect to the  Installed Capability Entitlement if the unit or
combination of units had been fully available at its  full Installed Capability
throughout the Twelve- Month Measurement Period, which is represented by  (b)
the amount of generation which was actually  available during such period, or

(ii) the average Target Availability Rate expressed as a  percentage for the
Installed Capability Entitlement  for the Twelve-Month Measurement Period less
twenty  percentage points.  The average Target Availability  Rate of an
Installed Capability Entitlement for a  Twelve-Month Measurement Period is a
percentage and  is the average of the monthly Target Availability  Rates for
the months which comprise the Twelve-Month  Measurement Period, as determined
on the basis of  the Target Availability Rates for each of the twelve  months,
and as applied on a basis which is  consistent with the fuel or maturity status
of the  unit or combination of units for each month in the  Twelve-Month
Measurement Period.  The Target  Availability Rates shall be those utilized by
the  Participants Committee in its most recent  determination of NEPOOL
Objective Capability  pursuant to Section 7.

J    for the month is the estimated percentage point change in  NEPOOL
Objective Capability which would be required as a  result of a one percentage
point change in the weighted  average equivalent availability rate of the
generating  units in which the Participants have Installed Capability
Entitlements.  The value for J shall be adopted by the  Participants Committee
each time it fixes NEPOOL  Objective Capability pursuant to Section 7.

R    for the month is the phase-out factor for the month,  which shall be as
follows:

R=0.75    for the Power Year beginning November 1, 1997.

R=0.50    for the 12 month period beginning November 1,  1998.

R=0.25    for the 12 month period beginning November 1,  1999.

R=0       for the 12 month period beginning November 1,  2000 and all
subsequent 12 month periods.

(2)  A New Unit Adjustment Factor for a New Unit shall be  determined to assign
the effects of the  New Unit on NEPOOL  Objective Capability to those
Participants with Entitlements  in the New Unit.  The New Unit Adjustment
Factor for each New  Unit for each month shall be determined by the System
Operator  under the direction of the Participants Committee in  accordance with
the following formula:

n = R(K1(c-C) + K2(f-F) + K3(m-M) + K4(d-D) + K5(f- F)c2)

As used in this Section 12.2(a)(2), the symbols used in the  formula have the
following meanings:

R    is the phase out factor as defined in Section 12.2(a)(1)  above.

n    is the New Unit Adjustment Factor, expressed as a  fraction, for the month
for a New Unit.

c    is the Winter Capability of the New Unit.

C    is the Winter Capability of the Proxy Unit, which shall  be the number of
Kilowatts, as determined by the  Participants Committee, which would result in
the NEPOOL  Objective Capability being approximately the same if the
generating units in which the Participants have Installed  Capability
Entitlements were all units possessing Proxy  Unit characteristics.

f    is the equivalent forced outage rate of the New Unit,  expressed as a
fraction of a year, utilized in the  determination by the Participants
Committee of NEPOOL  Objective Capability for the month.

F    is the equivalent forced outage rate of the Proxy Unit.   F, a fraction,
shall be the weighted average equivalent  forced outage rate (using the Winter
Capability of each  generating unit for such weighting) of the generating
units in which the Participants have Installed Capability  Entitlements,
adjusted to compensate for the rounding of  the annual maintenance outage
requirement of the Proxy  Unit.

m    is the four-year average annual maintenance outage  requirement of the New
Unit, expressed as a fraction of a  year.  The data used to determine m shall
include the  annual maintenance outage requirements for the current  Power Year
and the next three Power Years, as utilized  for the New Unit in the most
recent determination by the  Participants Committee of NEPOOL Objective
Capability  pursuant to Section 7.

M    is the annual maintenance outage requirement of the Proxy  Unit.  M shall
be a fraction, the numerator of which  shall be the number of weeks (rounded to
the nearest full  number) that most closely approximates the weighted four-
year average annual maintenance outage requirement (using  the Winter
Capability of each generating unit for such  weighting) for the generating
units in which the  Participants have Installed Capability Entitlements, and
the denominator of which shall be 52 weeks.

d    is the summer derating of the New Unit, expressed as a  fraction of the
Winter Capability of the New Unit.

D    is the summer derating of the Proxy Unit.  D shall be a  fraction and
shall be equal to the weighted average  fractional summer derating (using the
Winter Capability  of each generating unit for such weighting) of the
generating units in which the Participants have Installed  Capability
Entitlements.

K1, K2, K3, K4, and K5

are conversion coefficients for each of the Summer and  Winter Periods,
determined by regression analysis such  that the product for the Installed
Capability of a New  Unit times its New Unit Adjustment Factor approximates
the effect on NEPOOL Objective Capability of the New  Unit.

Proxy Unit characteristics and conversion coefficients  contained in the
formula shall be adopted by the Participants  Committee and reviewed every five
years (or more frequently if  the Participants Committee determines that
exceptional  circumstances require an earlier review) and revised as
necessary.

If a New Unit has unique characteristics affecting NEPOOL  Objective Capability
which are not adequately reflected in the  New Unit Adjustment Factor formula,
the Participants Committee  shall determine for such New Unit a New Unit
Adjustment Factor  which accounts for the New Unit's unique characteristics.

The New Unit Adjustment Factor for any Restricted Unit (as  defined in Section
15.37B of the Prior NEPOOL Agreement) for  which proposed plans were submitted
subsequent to November 1,  1990 for review pursuant to Section 18.4 or its
predecessor  section in the Prior NEPOOL Agreement (or, in the case of a  unit
with a rated capacity of less than 5 MW, for which  notification was first
given to NEPOOL subsequent to November  1, 1990) and for the Peabody Municipal
Light Plant's Waters  River #2 unit shall be determined in accordance with the
formula previously specified in Section 12.2(a)(2), modified  as follows:

n =  R(K1(c-C) + K2(f-F) + K3(m-M) + K4(d-D) +K5(f-F)c2) +  K6(2500-a)

The symbols used in the above formula, as modified, shall have  the meanings
previously specified, except that the symbols  "K6" and "a" shall have the
following meanings:

K6   is a scaling factor of 0.0001.

a    is as follows:

for units with more than 2500 annual hours available for  operation, "a" =
2500,

for units with annual hours available for operation  between 500 and 2500,
inclusive, "a" = annual hours  available for operation, and

for units with annual hours available for operation less  than 500 hours, "a" =
-7500;

provided, however, that a Participant may elect to avoid, in  whole or part,
the effect on its Installed Capability  Responsibility of a Restricted Unit's
availability being  limited to 2500 hours or less a year by agreeing to leave
unfilled a portion of its dispatchable load allocation in  accordance with
rules adopted by the Markets Committee prior  to the activation of the
Participants Committee or the  Participants Committee thereafter.

(b)  The tentative Installed Capability Responsibilities of the  Participants
for any month, as determined in accordance with  Section 12.2(a), shall be
adjusted in accordance with this Section  12.2(b) in the event the value of H
for any Participant for any of  the Twelve-Month Measurement Periods applicable
to the Participant  for the month is increased in accordance with Section
12.2(a)  because of the application of paragraph (ii) of the definition of  H1.
In such event the System Operator under the direction of the  Participants
Committee shall determine each Participant's tentative  Installed Capability
Responsibility for the month with and without  the application of said
paragraph (ii).  The difference between the  sum of all Participants' tentative
Installed Capability  Responsibilities, with and without the application of
said  paragraph (ii) for the month, shall be added to the tentative  Installed
Capability Responsibilities of the Participants, as  determined in accordance
with Section 12.2(a), in proportion to  said tentative Installed Capability
Responsibilities, thereby  establishing each Participant's adjusted tentative
Installed  Capability Responsibility for the month.

(c)  For each month, the System Operator under the direction of the
Participants Committee shall determine the sum of all Participants'  adjusted
tentative Installed Capability Responsibilities, as  initially determined in
accordance with Section 12.2(a) and as  adjusted in accordance with Section
12.2(b), if Section 12.2(b) is  applicable for such month.  If the sum is less
than, or equal to,  the minimum NEPOOL Installed Capability during the month,
then the  adjusted tentative Installed Capability Responsibility as  determined
pursuant to Section 12.2(a) or 12.2(b), whichever is  applicable, for each
Participant is the final Installed Capability  Responsibility for each
Participant.  If the sum is greater than  such minimum NEPOOL Installed
Capability, then each Participant's  final Installed Capability Responsibility
shall be its adjusted  tentative Installed Capability Responsibility as
determined  pursuant to Section 12.2(a) or 12.2(b), whichever is applicable,
multiplied by the ratio of the minimum NEPOOL Installed Capability  during the
month to the sum of the adjusted tentative Installed  Capability
Responsibilities for the month.

(d)  It is recognized that the treatment of fuel conversions, dual fuel  units,
immature units, new Installed Capability Entitlements,  cogeneration and small
power-producing facilities, Unit Contracts  and other contract arrangements,
units with unusual maintenance  cycles, and various other matters can result in
special problems in  the determination of Unit Availability Adjustment Factors
and New  Unit Adjustments.  Accordingly, the Markets Committee shall analyze
such special problems and recommend to the Participants Committee  for approval
appropriate market operation rules to be applied in  taking such matters into
account in the determination of Unit  Availability Adjustment Factors and New
Unit Adjustments.

12.3 [Deleted].

12.4 Bids to Furnish Installed Capability.  Each Participant shall submit to
or have on file with the System Operator, in accordance with the market
operation rules approved by the Markets Committee prior to the  activation of
the Participants Committee or the Participants Committee  thereafter, one or
more bids specifying the Bid Price and Kilowatt  amount at which it will
furnish any and all surplus Installed System  Capability for a month through
NEPOOL to other Participants.  If no bid  is submitted for a month for any
surplus Installed System Capability,  the Bid Price for any such surplus for
which there is no bid shall be  deemed to be zero.

12.5 Consequences of Deficiencies in Installed Capability Responsibility.

(a)  At the conclusion of each month, the System Operator shall  determine
whether each Participant has satisfied its Installed  Capability Responsibility
obligation for the month.  If the minimum  monthly Installed System Capability
of a Participant during the  month was less than its Installed Capability
Responsibility, the  number of Kilowatts of its deficiency shall be computed
and the  Participant shall be deemed to purchase from other Participants
through NEPOOL Kilowatts of surplus Installed System Capability  equal to the
amount of its deficiency and shall pay to NEPOOL for  the month any applicable
fees for services assessed pursuant to  Section 19.2 plus the product of its
total Kilowatts of deficiency  and the Installed Capability Clearing Price for
the month  determined in accordance with Section 12.5(b).  For purposes of
this Section 12, the minimum monthly Installed System Capability of  a
Participant for a month is the Participant's lowest Installed  System
Capability for any hour during the month.  Retirements made  on the last day of
any month shall not be deducted from Installed  System Capability for that
month.

(b)  At the end of each month, the System Operator shall determine the
Installed Capability Clearing Price for the month as follows:

(i)  The System Operator shall determine the aggregate Kilowatt  shortage of
Installed System Capability for the month for all  Participants that did not
satisfy their Installed Capability  Responsibilities for that month.

(ii) The System Operator shall rank in the order of lowest to  highest Bid
Price all Bid Prices received from Participants  having excess Installed System
Capability for the month.

(iii)     For each Participant, its Installed System Capability  with the
lowest Bid Prices shall be deemed to have been  furnished first, to the extent
required, to meet its Installed  Capability Responsibility.  Any remainder
starting with the  lowest Bid Prices shall be deemed to have been furnished, to
the extent required, to other Participants under this  Agreement to meet their
shortages of Installed System  Capability for the month.

(iv) The Installed Capability Clearing Price for the month shall  equal the
highest Bid Price for Installed System Capability  that is deemed in accordance
with Section 12.5(b)(iii) to have  been furnished to another Participant for
the month.

12.6 [Deleted].

12.7 Payments to Participants Furnishing Installed Capability.

(a)  Participants that are deemed pursuant to Section 12.5 to furnish  any
surplus in their Installed System Capability to other  Participants shall
receive therefor their pro rata shares on a  Kilowatt basis of all payments
made by Participants for the month  under Section 12.5, excluding any
applicable fees for services  assessed pursuant to Section 19.2.  If two or
more Participants  with excess Installed System Capability have bid Kilowatts
at the  Installed Capability Clearing Price, but not all the excess  Installed
System Capability bid at such price is required to meet  shortages of Installed
System Capability, then the excess Installed  System Capability bid at the
Installed Capability Clearing Price  that each such Participant shall be deemed
to have furnished shall  be the Kilowatts of excess Installed System Capability
bid by the  Participant at that price multiplied by the ratio of (i) the total
Kilowatts of excess Installed System Capability bid at the  Installed
Capability Clearing Price needed to meet the shortages to  (ii) the total
Kilowatts of excess Installed System Capability bid  by all Participants at the
Installed Capability Clearing Price.

(b)  [Deleted].

SECT65535ON 13

OPERATION, GENERATION, OTHER RESOURCES, AND INTERRUPTIBLE CONTRACTS

13.1 Maintenance and Operation in Accordance with Good Utility Practice.   Each
Participant shall, to the fullest extent practicable, cause all  generating
facilities and other resources owned or controlled by it to  be designed,
constructed, maintained and operated in accordance with  Good Utility Practice.


13.2 Central Dispatch.  Subject to the following sentence, each Participant
shall, to the fullest extent practicable, subject all generating  facilities
and other resources owned or controlled by it to central  dispatch by the
System Operator; provided, however, that each  Participant shall at all times
be the sole judge as to whether or not  and to what extent safety requires that
at any time any of such  facilities will be operated at less than full capacity
or not at all.   Each Participant may remove from central dispatch a generating
facility  or other resources owned or controlled by it if and to the extent
such  removal is permitted by rules and standards approved by the Participants
Committee.

13.3 Maintenance and Repair.  Each Participant shall, to the fullest extent
practicable:  (a) cause generating facilities and other resources owned  or
controlled by it to be withdrawn from operation for maintenance and  repair
only in accordance with maintenance schedules reported to and  published by the
System Operator from time to time in accordance with  procedures established or
approved by the Markets Committee prior to the  activation of the Participants
Committee or the Participants Committee  thereafter, (b) restore such
facilities to good operating condition with  reasonable promptness, and (c)
accelerate or delay maintenance and  repair at the reasonable request of the
System Operator in accordance  with market operation rules approved by the
Markets Committee prior to  the activation of the Participants Committee or the
Participants  Committee thereafter.

13.4 Objectives of Day-to-Day System Operation.  The day-to-day scheduling  and
coordination through the System Operator of the operation of  generating units
and other resources shall be designed to assure the  reliability of the bulk
power system of the NEPOOL Control Area.  Such  activity shall:

(a)  satisfy the NEPOOL Control Area's Operating Reserve requirements,
including the proper distribution of those Operating Reserves;

(b)  satisfy the Automatic Generation Control requirements of the NEPOOL
Control Area; and

(c)  satisfy the Energy requirements of all Electrical Loads of the
Participants,

all at the lowest practicable aggregate dispatch cost to the NEPOOL  Control
Area in light of available Bid Prices and Participant-directed  schedules.

13.5 Satellite Membership.  Each Participant which is responsible for the
operation of transmission facilities rated 69 kV or above in the NEPOOL
Control Area or generating units and other resources which are subject  to
central dispatch by NEPOOL, or which is responsible for implementing  voltage
reduction and load shedding procedures in the NEPOOL Control  Area, shall
become a member of the appropriate satellite dispatching  center; provided that
by mutual agreement among the affected  Participants and the appropriate
satellite, a Participant may be excused  from joining the satellite if it has
arranged with a satellite member to  assume responsibility to the satellite for
its facilities or  obligations.

SECT65535ON 14

INTERCHANGE TRANSACTIONS

14.1 Obligation for Energy, Operating Reserve and Automatic Generation
Control.

(a)  Each Participant shall have for each hour an Energy obligation  equal to
its Electrical Load plus the kilowatthours delivered by  such Participant to
other Participants in the hour pursuant to Firm  Contracts or System Contracts,
together with any associated  electrical losses.

(b)  Each Participant shall have for each hour Operating Reserve  obligations
equal to its share of the quantity of each category of  Operating Reserve
required for the NEPOOL Control Area in the hour.

Subject to adjustment pursuant to Section 14.6, a Participant's  share of each
category of Operating Reserve required for any hour  shall be determined in
accordance with the following formula:

ORp=SAp + [(OR-SA) (ELp/EL)], wherein

ORp  is the Participant's share of that category of Operating  Reserve for the
hour.

SAp  is the number of Kilowatts, if any, of that category of  Operating Reserve
for the hour that the Participants  Committee determines should be assigned
specifically to  such Participant and not be shared by all Participants.

OR   is the aggregate number of Kilowatts of that category of  Operating
Reserve determined by the System Operator in  accordance with the directions of
the Participants  Committee to be required for the NEPOOL Control Area for  the
hour that is not assigned to Non-Participants.

SA   is the aggregate number of Kilowatts of that category of  Operating
Reserve for the hour that the Participants  Committee determines should not be
shared by all  Participants, but not including Operating Reserve  assigned to
Non-Participants.

ELp  is the Participant's Electrical Load for the hour.

EL   is the sum of ELp for all Participants.

(c)  Each Participant shall have for each hour an AGC obligation equal  to its
share of AGC required for the NEPOOL Control Area in the  hour.  Subject to
adjustment pursuant to Section 14.6, a  Participant's share of AGC required for
any hour shall be  determined in accordance with the following formula:

AGCp=AGC (ELp/EL), wherein

AGCp is the Participant's share of AGC for the hour.

AGC  is the total amount of AGC determined by the System  Operator in
accordance with market operation rules  approved by the Markets Committee prior
to the activation  of the Participants Committee or the Participants  Committee
thereafter to be required for the NEPOOL  Control Area for the hour that is not
assigned to Non- Participants.

ELp and EL are as defined in Section 14.1(b).

14.2 Obligation to Bid or Schedule, and Right to Receive Energy, Operating
Reserve and Automatic Generation Control.

(a)  A Participant which has Energy Entitlements shall submit to or have  on
file with the System Operator, in accordance with the market  operation rules
approved by the Markets Committee prior to the  activation of the Participants
Committee or the Participants  Committee thereafter, one or more bids for the
Energy Entitlements  for which the Participant is permitted to bid specifying
the Bid  Price at which it will furnish Energy through NEPOOL to other
Participants under this Agreement or to Non-Participants for  ancillary
services under the Tariff, or pursuant to arrangements  with Non-Participants
entered into under Section 14.6, except to  the extent such Entitlements are
scheduled by the Participant  consistent with Section 14.2(d).

(b)  A Participant which has Operating Reserve Entitlements or AGC
Entitlements shall also submit to or have on file with the System  Operator, in
accordance with the market operation rules approved by  the Markets Committee
prior to the activation of the Participants  Committee or the Participants
Committee thereafter, one or more  bids for each such Entitlement for which the
Participant is  permitted to bid specifying the Bid Prices at which it will
furnish  10-Minute Spinning Reserve, 10-Minute Non-Spinning Reserve,  30-Minute
Operating Reserve and/or AGC through NEPOOL to other  Participants under this
Agreement or to Non-Participants for  ancillary services under the Tariff,
except to the extent such  Entitlements are scheduled by the Participant
consistent with  Section 14.2(d).

(c)  Except as emergency circumstances may result in the System Operator
requiring load curtailments by Participants, each Participant shall  be
entitled to receive from the other Participants (or from the  service made
available from Non-Participants pursuant to  arrangements entered into under
Section 14.6) such amounts, if any,  of Energy, Operating Reserve, and AGC as
it requires and Non- Participants shall be entitled to receive from
Participants the  amount of ancillary services to which they are entitled
pursuant to  the Tariff.  If, for any hour, load curtailments are required, the
amount that Participants and Non-Participants with shortages are  entitled to
receive shall be proportionally reduced by the System  Operator in a fair and
non-discriminatory manner in light of the  circumstances.

(d)  All Bid Prices for Entitlements shall be submitted in accordance  with
market operation rules approved by the Markets Committee prior  to the
activation of the Participants Committee or the Participants  Committee
thereafter.  If a Bid Price is not submitted for any such  Entitlement, the Bid
Price shall be deemed to be zero.  For a  generating unit in which there are
multiple Entitlement holders,  only one Participant shall be permitted to
submit Bid Prices for  Energy, Operating Reserve and/or AGC Entitlements for
such unit or  to direct the scheduling of the unit for any Scheduled Dispatch
Period.  The Entitlement holders in each unit with multiple  Entitlement
holders shall designate a single Participant that will  be permitted to submit
Bid Prices and/or to direct the scheduling  of the unit.  In the event that
more than one Participant is  designated, or if the Entitlement holders do not
designate a single  Participant, then Bid Prices for the unit shall be based on
its  replacement cost of fuel, which shall be furnished to the System  Operator
by the Participant responsible for furnishing such  information as of December
1, 1996.  Further, any schedules for the  unit will be submitted to the System
Operator by such Participant.  Nothing in this Agreement shall affect the
rights of any  Entitlement holder under the contractual arrangements among such
Entitlement holders relating to the unit.

Prior to the Third Effective Date, Bid Prices must be submitted for  the next
Scheduled Dispatch Period for all Energy, Operating  Reserve and AGC
Entitlements in generating unit or units and Energy  Entitlements pursuant to
Firm Contracts or System Contracts which  may be scheduled by the buyer in
accordance with Section 14.7(b) no  later than noon on the preceding day or
such later time as is  specified in the market operation rules approved by the
Markets  Committee prior to the activation of the Participants Committee or
the Participants Committee thereafter.  On and after the Third  Effective Date,
such Bid Prices shall be submitted for each hour of  the day and the notice
period for such Bid Prices shall be reduced  to one hour or such shorter time
as the System Operator determines  from time to time is practical while
maintaining reliability and  meeting its other obligations to the Participants,
except that such  notice period shall be longer than one hour if and to the
extent  that the System Operator reasonably determines that such notice is  the
shortest notice that is technically feasible at that time to  maintain
reliability and meet its other obligations to the  Participants.  The System
Operator shall notify the Participants  following its receipt of all Bid Prices
of the expected dispatch  schedule for the next Scheduled Dispatch Period.  The
System  Operator shall reduce the notice required for Bid Prices and the
applicable Scheduled Dispatch Period to the minimum time  technically and
practically feasible while maintaining reliability  and meeting its other
obligations to the Participants. Energy, Operating Reserve and/or AGC
Entitlements in a generating  unit or units may also be scheduled directly by
the Participants  permitted to submit Bid Prices for such Entitlements, but
only in  accordance with this Section 14.2(d) and market operation rules
approved by the Markets Committee prior to the activation of the  Participants
Committee or the Participants Committee thereafter  consistent herewith.
Subject to the right of the System Operator  to direct changes to schedules in
order to ensure reliability in  the NEPOOL Control Area or any neighboring
control area, a  Participant permitted to bid its Energy, Operating Reserve,
and/or  AGC Entitlements in a generating unit or units, or required to make
Energy deliveries, may submit an hour-to-hour schedule for the  operation or
dispatch of such Entitlements during a Scheduled  Dispatch Period at or before
the time that Bid Prices are required  to be submitted for such period.  In
addition, prior to the Third  Effective Date, a Participant permitted to bid a
unit or units may  submit a short-notice schedule for the operation or dispatch
of any  or all of the Energy available from such unit or units during the
current or a subsequent Scheduled Dispatch Period following the  time that the
System Operator notifies the appropriate Participants  of their expected
Entitlement commitments for that Scheduled  Dispatch Period; provided that, for
each such short-notice  schedule, the Participant has not been advised by the
System  Operator that the Energy, Operating Reserve or AGC Entitlements  from
the unit or units covered by the Participant's schedule are  expected to be
used during the Scheduled Dispatch Period to meet  the region's Energy,
Operating Reserve and/or AGC requirements, and  provided further that the
Participant short-notice schedule is only  to facilitate transactions during
such period from resources or to  load located outside the NEPOOL Control Area;
and provided further  that such schedule is furnished at least one hour in
advance of the  start of the transaction.  In addition, a Participant may, on
the  same short notice, schedule System Contracts with Non-Participants  from
resources or to load located outside of the NEPOOL Control  Area.

14.3 Amount of Energy, Operating Reserve and Automatic Generation Control
Received or Furnished.

(a)  For purposes of Sections 14.4, 14.5, and 14.8, the amount of Energy  which
a Participant is deemed to receive or furnish in any hour  shall be the amount
of its Adjusted Net Interchange.  If the  Adjusted Net Interchange is negative,
the Participant shall be  deemed to be receiving Energy in the hour.  If the
Adjusted Net  Interchange is positive, the Participant shall be deemed to be
furnishing Energy in the hour.

(b)  For purposes of Sections 14.4, 14.5, and 14.9, prior to the Third
Effective Date:  the amount of each category of Operating Reserve  which a
Participant is deemed to receive in any hour is the  Kilowatts of such
Operating Reserve assigned to the Participant for  the hour under Section
14.1(b) less any Kilowatts provided in the  hour by the Participant in
accordance with the market operation  rules approved by the Markets Committee
prior to the activation of  the Participants Committee or the Participants
Committee thereafter  to meet any Operating Reserve requirements that were
specifically  assigned to it and not shared by all Participants; the amount of
Operating Reserve of each category that the Participant is deemed  to have
furnished under the Agreement in the hour is the amount of  such Operating
Reserve designated by the System Operator to be  provided in the hour by the
Participant's applicable Operating  Reserve Entitlements, minus any Kilowatts
used in the hour by the  Participant in accordance with the market operation
rules to meet  any Operating Reserve requirements that were specifically
assigned  to it and not shared by all Participants.  For purposes of Sections
14.4, 14.5, and 14.9, on and after the Third Effective Date, the  amount of
each category of Operating Reserve which a Participant is  deemed to have
received or furnished in any hour is the difference  between the Kilowatts of
such Operating Reserve assigned to the  Participant for the hour under Section
14.1(b) and the Kilowatts of  such Operating Reserve designated by the System
Operator to be  provided in the hour by the Participant's applicable Operating
Reserve Entitlements.

(c)  For purposes of Sections 14.4, 14.5, and 14.10, prior to the Third
Effective Date, the amount of AGC which a Participant is deemed to  have
received in an hour is the AGC assigned to the Participant for  the hour under
Section 14.1(c), and the amount a Participant is  deemed to have furnished in
the hour is the AGC designated by the  System Operator to be provided in the
hour by the Participant's AGC  Entitlements.  For purposes of Sections 14.4,
14.5, and 14.10, on  and after the Third Effective Date, the amount of AGC
which a  Participant is deemed to have received or furnished in an hour is  the
difference between the AGC assigned to the Participant for the  hour under
Section 14.1(c) and the AGC designated by the System  Operator to be provided
in the hour by the Participant's AGC  Entitlements.

14.4 Payments by Participants Receiving Energy Service, Operating Reserve and
Automatic Generation Control.

(a)  For every hour in which a Participant's Adjusted Net Interchange is
negative, the number of megawatthours of its Energy deficiency  shall be
computed and the Participant shall pay for the hour the  product of its total
megawatthours of deficiency and the Energy  Clearing Price applicable for the
hour as determined in accordance  with Section 14.8, together with any
applicable uplift charges  assessed to the Participant under Sections 14.14 and
14.15 of this  Agreement and Section 24 of the Tariff  and any applicable fees
for  services assessed pursuant to Section 19.2.

(b)  For every hour in which a Participant is deemed to receive  Operating
Reserve of any category in accordance with Section  14.3(b), the number of
Kilowatts it is deemed to receive for the  hour in each category shall be
computed.  The Participant shall pay  therefor for the hour any applicable
uplift charge assessed under  Section 14.15 and any applicable fees for
services assessed  pursuant to Section 19.2 plus the product of (i) the
aggregate  amount paid to Participants for that category of Operating Reserve
for the hour pursuant to Section 14.5(b) and (ii) a fraction of  which the
numerator is the Kilowatts of that category of Operating  Reserve deemed under
Section 14.3(b) to have been received by the  Participant for the hour and the
denominator is the aggregate  Kilowatts of that category of Operating Reserve
deemed under  Section 14.3(b) to have been received by all Participants for the
hour.

(c)  For every hour in which a Participant is deemed under Section  14.3(c) to
have received AGC, the amount it is deemed to receive  shall be computed and
the Participant shall pay therefor any  applicable uplift charge assessed under
Section 14.15 and any  applicable fees for services assessed pursuant to
Section 19.2 plus  the product of (i) the aggregate amount paid to Participants
for  AGC for the hour pursuant to Section 14.5(c) and (ii) a fraction of  which
the numerator is the AGC the Participant is deemed under  Section 14.3(c) to
have received for the hour and the denominator  is the aggregate amount of AGC
all Participants are deemed under  Section 14.3(c) to have received for the
hour.

14.5 Payments to Participants Furnishing Energy Service, Operating Reserve,
and Automatic Generation Control.

(a)  Subject to the provisions of Section 14.12, a Participant that is  deemed
in an hour to furnish Energy service to other Participants  pursuant to Section
14.3, or to Non-Participants for ancillary  services under the Tariff or
pursuant to arrangements entered into  under Section 14.6, shall receive for
each megawatthour furnished  by it the Energy Clearing Price for the hour
determined in  accordance with Section 14.8 or the Bid Price for that
megawatthour, if higher than the Energy Clearing Price and the unit  is either
within the Energy Clearing Price Block (as defined in  Section 14.8(c)) or is
operated out of merit if such higher Bid  Price is appropriately paid pursuant
to market operation rules  governing out-of-merit generation approved by the
Markets Committee  prior to the activation of the Participants Committee or the
Participants Committee thereafter.  In addition, to the extent that  the System
Operator reduces Energy production from a generating  unit or units in order to
provide VAR support, Participants with  Entitlements in such unit or units may
receive their lost  opportunity costs if and to the extent provided for by
market  operation rules approved by the Markets Committee prior to the
activation of the Participants Committee or the Participants  Committee
thereafter.

(b)  A Participant that is deemed in an hour to furnish Operating  Reserve
under the Agreement shall receive for each Kilowatt of each  category of
Operating Reserve furnished by it the applicable  Operating Reserve Clearing
Price as defined and determined in  accordance with Section 14.9 or the Bid
Price to provide such  Kilowatt, if higher than the Operating Reserve Selling
Price for  the hour.

(c)  A Participant that is deemed in an hour to furnish AGC under the
Agreement shall receive therefor an amount calculated as follows:

(i)  the AGC Clearing Price for the hour as defined and determined  in
accordance with Section 14.10, times the change in AGC  output of the
Participant's AGC Entitlements which the System  Operator requested in the
hour, times an appropriate unit  conversion factor as determined in accordance
with market  operation rules approved by the Markets Committee prior to the
activation of the Participants Committee or the Participants  Committee
thereafter; plus

(ii)      an AGC reservation payment for each AGC Entitlement that  the System
Operator designated for AGC in the hour calculated  as (A) the AGC Clearing
Price in effect for the hour, times  (B) the level of AGC the System Operator
determines to be  available in the hour from the Entitlement, times (C) the
portion of the hour during which the System Operator had  designated the
Entitlement for AGC; plus

(iii)     a payment that compensates the Participant for its lost  opportunity
cost, if any, for the operation of the generating  unit or combination of units
designated for AGC in the hour  below the desired level of output in order to
provide AGC, as  determined in accordance with market operation rules approved
by the Markets Committee prior to the activation of the  Participants Committee
or the Participants Committee  thereafter.

14.6 Energy Transactions with Non-Participants.

(a)  The Participants Committee is authorized to enter into contracts on
behalf of and in the names of all Participants (i) with power pools  or other
entities in one or more other control areas to purchase or  furnish emergency
Energy (and related services) that is available  for the System Operator to
schedule in order to ensure reliability  in the NEPOOL Control Area or
neighboring control areas, and (ii)  with Non-Participants pursuant to which
ancillary services will be  provided by the Participants pursuant to the
Tariff.  The terms of  any such contractual arrangement shall not require the
furnishing  of emergency service to any other control area until the service
needs of all Participants have been provided for with the least  expensive
resources practicable.  Energy purchased in any hour from  Non-Participants
under a contract entered into pursuant to this  Section 14.6(a) shall be deemed
to be furnished to, and paid for  by, Participants entitled to or requiring
such Energy in the hour  pursuant to this Section 14 at the higher of the
Energy Clearing  Price for the hour or the price paid to the Non-Participant
for the  Energy.

(b)  The Participants Committee is authorized to provide for the day-to- day
scheduling through the System Operator of the HQ Phase II Firm  Energy
Contract, in accordance with the HQ Use Agreement, as if the  Contract were a
contract covering Energy transactions with a Non- Participant entered into
pursuant to Section 14.6(a).  The HQ Phase  II Firm Energy Contract shall not
be deemed a Firm Contract for  purposes of this Agreement.  Energy received in
an hour from Hydro- Quebec pursuant to the HQ Energy Banking Agreement, and
Energy  purchased in any hour from Hydro-Quebec pursuant to the HQ Phase II
Firm Energy Contract or any other HQ Contract shall be deemed to be  Energy
furnished to each Participant entitled to such Energy for  the hour in the
amount reflected for the Participant in the System  Operator's scheduling of
Energy deliveries in the hour from Hydro- Quebec; except that emergency Energy
received from Hydro-Quebec  under the HQ Interconnection Agreement shall be
deemed to be Energy  provided to (and shall be paid for by) Participants
requiring such  emergency Energy in the hour.  The System Operator shall
schedule  such Energy deliveries to accommodate, to the maximum extent
possible, the schedule of Energy deliveries from Hydro-Quebec  requested by the
Participant.  The Participants deemed to have  received such Energy shall pay
therefor the higher of the Energy  Clearing Price (together with any applicable
uplift charges under  Sections 14.14 and/or 14.15 of this Agreement and/or
Section 24 of  the Tariff and any applicable fees for services assessed
pursuant  to Section 19.2) or the price paid to Hydro-Quebec for the Energy
(or in the case of Energy received under the HQ Energy Banking  Agreement, the
price paid for the related Energy deliveries to  Hydro-Quebec under the
Agreement and any amount payable to Hydro- Quebec with respect to the
transaction).

14.7 Participant Purchases Pursuant to Firm Contracts and System Contracts.

(a)  For Firm Contracts and System Contracts, the treatment of Installed
Capability, Energy, Operating Reserve and AGC between the seller  and the
purchaser in determining their respective responsibilities  and Entitlements
shall be as agreed between the parties and  reported to the System Operator in
accordance with market operation  rules approved by the Markets Committee prior
to the activation of  the Participants Committee or the Participants Committee
thereafter.  If and to the extent necessary to implement the  agreement between
the parties, such market operation rules, upon  approval by the Participants
Committee, shall supersede the  provisions of the Agreement that otherwise
apply for determination  of the respective responsibilities and Entitlements of
the parties.

(b)  In the event a Participant has the right to receive Energy,  Operating
Reserve and/or AGC from a Non-Participant under a System  Contract or a Firm
Contract, such Contract shall be treated as  nearly as possible as if it were a
Unit Contract for an Energy  Entitlement, Operating Reserve Entitlement and/or
AGC Entitlement,  as applicable, provided that, in the case of Energy,
Operating  Reserve, and/or AGC, the System Contract or Firm Contract permits
the scheduling of deliveries of such Energy, Operating Reserve  and/or AGC to
be subject in whole or part to central dispatch  through the System Operator in
accordance with market operation  rules approved by the Markets Committee prior
to the activation of  the Participants Committee or the Participants Committee
thereafter.

14.8 Determination of Energy Clearing Price.  For each hour, the System
Operator shall determine the Energy Clearing Price as follows:

(a)  The System Operator shall rank in the order of lowest to highest  (i) the
Dispatch Prices derived from the Bid Prices to furnish  Energy in the hour and
(ii) the cost to NEPOOL of any Energy  received from Non-Participants in the
hour pursuant to contracts  referenced in Section 14.6.

(b)  The Energy Clearing Price shall be the weighted average of the  Dispatch
Prices (or NEPOOL cost) of the "Energy Clearing Price  Block" as defined in the
next sentence.  The Energy Clearing Price  Block shall be identified for each
hour in accordance with market  operation rules approved by the Markets
Committee prior to the  activation of the Participants Committee or the
Participants  Committee thereafter to reflect those resources with the highest
Dispatch Prices or NEPOOL cost that were centrally dispatched by  the System
Operator for Energy deemed to have been furnished to the  Participants,
excluding resources that were dispatched out of merit  as determined in
accordance with market operation rules approved by  the Markets Committee prior
to the activation of the Participants  Committee or the Participants Committee
thereafter.

14.9 Determination of Operating Reserve Clearing Price.

(a)  For each hour as necessary, the System Operator shall determine the
Operating Reserve Clearing Price for each category of Operating  Reserve as
follows:

(i)  The System Operator shall determine the aggregate Kilowatts of  the
applicable category of Operating Reserve that are deemed  pursuant to Section
14.3(b) to have been received by  Participants for the hour.

(ii) For 10-Minute Non-Spinning Reserve and 30-Minute Operating  Reserve, the
System Operator shall rank in the order of lowest  to highest the Bid Prices of
the resources designated by the  System Operator for that category of Operating
Reserve for the  hour.  The applicable Operating Reserve Clearing Price for 10-
Minute Non-Spinning Reserve or 30-Minute Operating Reserve  shall be the
weighted average of the highest Bid Prices for  the 1000 Kilowatts (or such
other number as may be specified  by the Markets Committee prior to the
activation of the  Participants Committee or the Participants Committee
thereafter) of that category of Operating Reserve that are  designated by the
System Operator for use in the hour.

(iii)     For 10-Minute Spinning Reserve the System Operator shall  rank in
order of lowest to highest the 10-Minute Spinning  Reserve Lost Opportunity
Prices (as defined in Section  14.9(b)) of the resources designated by the
System Operator  for the hour.  The Operating Reserve Clearing Price for 10-
Minute Spinning Reserve shall be the weighted average for the  1000 Kilowatts
(or such other number as may be specified by  the Markets Committee prior to
the activation of the  Participants Committee or the Participants Committee
thereafter) of the highest 10-Minute Spinning Reserve Lost  Opportunity Prices
for the hour of the Entitlements that were  designated by the System Operator
for use in the hour.

(b)  The System Operator shall determine a 10-Minute Spinning Reserve  Lost
Opportunity Price for each hour for use in determining the  Operating Reserve
Clearing Price for 10-Minute Spinning Reserve.   For the purposes of Section
14.9, the 10-Minute Spinning Reserve  Lost Opportunity Price for a
Participant's resource shall be the  amount by which the Energy Clearing Price
for the hour exceeds the  resource's Dispatch price (not less than zero), plus
the Bid Price  in the hour for each resource to provide 10-Minute Spinning
Reserve.

14.10     Determination of AGC Clearing Price.  For each hour, the System
Operator shall determine the AGC Clearing Price.  The AGC Clearing Price  shall
be the weighted average "AGC Capability Price" for the "AGC  Clearing Price
Block," as both terms are defined below in this Section  14.10.  The AGC
Capability Price for each hour for each AGC Entitlement  designated by the
System Operator to provide AGC in the hour shall be a  cost per unit of AGC
capability based on the Bid Price for the  Entitlement for the hour divided by
the amount of AGC available in the  hour from that Entitlement.  The AGC
Clearing Price Block shall be  identified by the System Operator for each hour
in accordance with  market operation rules approved by the Markets Committee
prior to the  activation of the Participants Committee or the Participants
Committee  thereafter to reflect those AGC resources with the highest Bid
Prices  that were designated by the System Operator to provide AGC in the hour
and were deemed pursuant to Section 14.3(c) to have been received by
Participants for the hour.

14.11     Funds to or from which Payments are to be Made.

(a)  All payments for Energy, Operating Reserves or AGC furnished or  received,
all uplift charges paid pursuant to this Section 14 of  this Agreement and
Section 24 of the Tariff, and all fees for  services paid pursuant to Section
19.2, and any payments by Non- Participants for ancillary services under
Schedules 2-7 to the  Tariff or pursuant to arrangements referenced in Section
14.6,  shall be allocated each month through the Pool Interchange Fund as
follows:

Step One.  For each week in which Energy is delivered or received  under the HQ
Energy Banking Agreement, all payments with respect to  transactions under that
Agreement shall be made to or from the  Energy Banking Fund provided for in
Section 14.11(b).

Step Two.  (i) For each week in which Pre-Scheduled Energy (as  defined in the
HQ Phase I Energy Contract) is purchased pursuant to  the HQ Phase I Energy
Contract, the aggregate amount which is paid  pursuant to Section 14.6(b) for
such Energy by each Participant  which is a participant in the Phase I
arrangements with Hydro- Quebec shall be determined and paid on the
Participant's account  into the Phase I Savings Fund.

(ii)  For each week in which Energy is purchased pursuant to the HQ  Phase II
Firm Energy Contract, the aggregate amount which is paid  pursuant to Section
14.6(b) for such Energy by each Participant  which is a participant in the
Phase II arrangements with Hydro- Quebec shall be determined and paid on the
Participant's account  into the Phase II Savings Fund.

Step Three. For each week in which Other HQ Energy is purchased  pursuant to
the HQ Phase I Energy Contract or Energy is purchased  pursuant to the HQ
Interconnection Agreement, the aggregate amount  paid pursuant to Section
14.6(b) for such Energy shall be  determined for each Participant which is a
participant in the Phase  I or Phase II arrangements with Hydro-Quebec.  Such
amount shall be  allocated between the Participant's share of the Phase I
Savings  Fund and the Participant's share of the Phase II Savings Fund  created
under the HQ Use Agreement in the same ratio as (A) the sum  of (x) the number
of kilowatthours of Other HQ Energy deemed to be  purchased by the Participant
during the week and (y) the HQ Phase I  Percentage of the number of
kilowatthours deemed to be purchased by  the Participant under the HQ
Interconnection Agreement during the  week, bears to (B) the HQ Phase II
Percentage of the number of  kilowatthours purchased under the HQ
Interconnection Agreement  during the week.

Step Four.  The balance remaining in the Pool Interchange Fund  after Steps One
through Three shall be retained in the Pool  Interchange Fund for the month and
shall be used and disbursed  after each month in the following order:

(i)  (A) amounts owed to Non-Participants (other than Hydro-Quebec)  for the
month under contracts entered into with them pursuant  to Section 14.6(a) shall
be paid, and (B) amounts owed to  Hydro-Quebec for the month for Energy deemed
to be furnished  pursuant to Section 14.6(b) to Participants which are not
participants in the Phase I or Phase II arrangements with  Hydro-Quebec shall
be paid and, in the event the price paid by  any such Participant for such
Energy is the Energy Clearing  Price, the excess, if any, of the Energy
Clearing Price over  the amount owed to Hydro-Quebec shall be paid to the
Participant;

(ii) amounts paid by Participants for applicable fees for services  assessed
pursuant to Section 19.2 shall be used to reduce  NEPOOL expenses; and

(iii)     amounts owed to Participants for the month pursuant to  Section 14.5
shall then be paid.

(b)  HQ Energy Banking Fund.  All amounts allocated to the HQ Energy  Banking
Fund for each month shall be used and disbursed as follows:

(i)  Participants which furnish Energy for delivery to Hydro-Quebec  under the
HQ Energy Banking Agreement shall receive therefor  from their share of the
Energy Banking Fund the amount to  which they are entitled for such service in
accordance with  Section 14.5.

(ii) amounts required to be paid to Hydro-Quebec under the HQ  Energy Banking
Agreement shall be paid from the shares of the  Fund of the Participants
engaging in transactions under the HQ  Energy Banking Agreement for the month
in accordance with  their respective interests in the transactions for the
month.   If there is not enough in any such share, the Participants  with the
deficient shares shall be billed and pay into their  shares of the Fund the
amounts required for payments to Hydro- Quebec.

(iii)     subject to the remaining provisions of this Section, at  the end of
each month any balance remaining in each  Participant's share of the HQ Energy
Banking Fund shall (I) in  the case of any Participant which is not a
participant in the  Phase I or Phase II arrangements with Hydro-Quebec, be paid
to  such Participant, and (II) in the case of any Participant  which is a
participant in the Phase I or Phase II arrangements  with Hydro-Quebec, be paid
to the Escrow Agent under the HQ  Use Agreement to be held and disbursed by it
through the Phase  I Savings Fund and Phase II Savings Fund created under the
HQ  Use Agreement, and shall be allocated between the  Participant's share of
said Funds as follows:

(A)  the balance remaining in the Participant's share of the  HQ Energy Banking
Fund for the month shall be divided by  the number of kilowatthours deemed to
be received by the  Participant under the HQ Energy Banking Agreement during
the month to determine an average savings amount per  kilowatthour;

(B)  for any hour during the month in which the number of  kilowatthours
received by NEPOOL under the HQ Energy  Banking Agreement exceeded the HQ Phase
I Transfer  Capability, an amount equal to (A) the Participant's  share of the
excess of (1) the number of kilowatthours  received over (2) the HQ Phase I
Transfer Capability  times (B) the average savings amount per kilowatthour
determined for that Participant under (i) above shall be  allocated to the
Phase II Savings Fund; and

(C)  the remaining balance of the Participant's share of the  HQ Energy Banking
Fund for the month shall be allocated  to the Phase I Savings Fund.

It is recognized that, in view of the time which may elapse  between the
delivery of Energy to or by Hydro-Quebec in an  Energy Banking transaction
under the HQ Energy Banking  Agreement and the return of the Energy, the
amounts of Energy  delivered to and received from Hydro-Quebec, after
adjustment  for losses, may not be in balance at the end of a particular
month.

Further, if as of the end of any month and after adjustment  for electrical
losses, the cumulative amount of Energy so  received from Hydro-Quebec exceeds
the amount so delivered,  the aggregate amount paid by Participants for the
excess  Energy pursuant to Section 14.6(b) shall be paid to the Energy  Banking
Fund.  The Escrow Agent under the HQ Use Agreement  shall hold and invest these
funds.  On the return of the  excess Energy to Hydro-Quebec, the amount so held
by the  Escrow Agent shall be repaid to Hydro-Quebec and Participants  in
accordance with the Energy Banking Agreement.

(c)  Phase I HQ Savings Fund.  The aggregate amount allocated to each
Participant's share of the Phase I HQ Savings Fund for each month  shall be
used, first, to pay to Hydro-Quebec the amount owed to it  for the month for
Energy furnished under the Phase I HQ Energy  Contract and the HQ Phase I
Percentage of the amount owed to it for  the month for Energy furnished to the
Participants under the HQ  Interconnection Agreement.  The balance of the
amount allocated to  the Fund for the month shall be paid to the Escrow Agent
under the  HQ Use Agreement to be held and disbursed by it through the Phase I
HQ Savings Fund created thereunder in accordance with each  Participant's
contribution to such balance.

(d)  Phase II HQ Savings Fund.  The aggregate amount allocated to the  Phase II
HQ Savings Fund for each month shall be used, first, to  pay to Hydro-Quebec
the amount owed to it for the month for Energy  deemed to be furnished to the
Participant under the Phase II HQ  Firm Energy Contract and the HQ Phase II
Percentage of the amount  owed to it for the month for Energy deemed to be
furnished to the  Participant under the HQ Interconnection Agreement.  The
balance of  the amount allocated to the Fund for the month shall be paid to the
Escrow Agent under the HQ Use Agreement to be held and disbursed by  it through
the Phase II HQ Savings Fund created thereunder in  accordance with each
Participant's contribution to such balance.

14.12     Development of Rules Relating to Nuclear and Hydroelectric
Generating Facilities, Limited-Fuel Generating Facilities, and  Interruptible
Loads.  It is recognized that the central dispatch of Energy available from
nuclear generating facilities and from pondage associated with  hydroelectric
generating facilities and from interruptible loads and of  pumping Energy for
pumped storage hydroelectric generating facilities  and other limited-fuel
generating facilities involves special problems  which must be resolved to
assure fair and non-discriminatory treatment  of Participants having
Entitlements in such generating facilities or  having such interruptible loads
or any other Participants involved in  such transactions.  Accordingly, the
Markets Committee shall analyze  such special problems and recommend to the
Participants Committee for  approval appropriate rules for dispatching such
facilities (including,  but not limited to, bids for dispatchable pumping load
at pumped storage  facilities), for handling such interruptible loads and for
paying for  Energy, Operating Reserve and AGC involved in such transactions on
a  basis consistent with the principles underlying this Section 14; and  upon
approval by the Participants Committee such rules shall supersede  the
provisions of Sections 12 and 14 to the extent of any conflict.

14.13     Dispatch and Billing Rules During Energy Shortages.  It is
recognized that Energy shortages can result in special problems which  must be
resolved to assure that dispatch and billing provisions do not  prevent
achievement of the objectives specified in Section 13.4.   Accordingly, the
Markets Committee shall analyze such special problems  and recommend to the
Participants Committee for approval appropriate  dispatch and billing rules to
be applied during periods when the  Participants Committee determines that
there is, or is anticipated to  be, an Energy shortage which adversely affects
the bulk power supply of  the NEPOOL Control Area and any adjoining areas
served by Participants.   Upon approval by the Participants Committee, such
rules shall supersede  the economic dispatch and billing provisions of this
Agreement to the  extent of any conflict therewith for the duration of such
Energy  shortage period.

14.14     Congestion Uplift.

(a)  It shall be the responsibility of the Participants Committee to  review
prior to January 1, 2000 the Congestion Costs incurred with  the new market
arrangements contemplated by Section 14 of this  Agreement and with retail
access, and to determine whether  subsection (b) of this Section, together with
an amendment  specifying the rights of Participants and Non-Participants across
a  constrained interface within the NEPOOL Control Area and to make  other
necessary or appropriate changes in subsection (b), all of  the provisions of
which shall be considered for modification, or  some other modified or
substitute provision dealing with the  allocation of Congestion Costs in a
constrained transmission area,  should be made effective on March 1, 2000 and
after the preparation  of necessary implementing rules and computer software or
on an  earlier or later effective date.  If the Participants Committee
determines that such a provision should be made effective, it shall  recommend
to the Participants any required amendment to the  Agreement and/or the Tariff
and a schedule for implementation which  will permit sufficient time for the
development of necessary rules  and computer software.  If  the Participants
Committee is unable to  agree on such a determination prior to January 1, 2000
any  Participant or group of Participants may propose such an amendment  and
schedule in a filing with the Commission.

(b)  Commencing on the earlier of June 1, 2000 or the beginning of the  first
calendar month sixty (60) days after the filing of an  amendment to the
Agreement and/or the Tariff by the Participants  Committee, any Participant or
group of Participants, but subject to  the adoption of an amendment specifying
the rights of Participants  and Non-Participants across constrained interfaces
within the  NEPOOL Control Area and making other necessary or appropriate
changes in the language of this subsection (b), and the preparation  of
necessary implementing rules and computer software, (or on such  earlier or
later date as is fixed by the Participants Committee in  accordance with
subsection (a) of this Section), whenever  limitations in available
transmission capacity in any hour require  that the System Operator dispatch
out-of-merit resources that are  bid by the Participants in any area which is
determined to be a  constrained transmission area in accordance with market
operation  rules approved by the Regional Market Operations Committee and the
Regional Transmission Operations Committee prior to the activation  of the
Participants Committee or the Participants Committee  thereafter, the System
Operator shall determine for the constrained  transmission area the aggregate
Congestion Costs for the hour.

Such Congestion Costs for each hour shall be allocated to and paid  by
Participants and Non-Participants as a congestion uplift as  follows:

(i)  In accordance with market operation rules approved by the  Regional Market
Operations Committee and the Regional  Transmission Operations Committee prior
to the activation of  the Participants Committee or the Participants Committee
thereafter, the System Operator shall identify for each  Participant and
Non-Participant the difference in megawatt  hours, if any, between (A)
Electrical Load served by the  Participant or Non-Participant in the
constrained area and  transactions by the Participant or Non-Participant
occurring  in the hour which utilized the constrained interface to move  Energy
through the constrained area and (B) the Participant's  or Non-Participant's
in-merit Energy Entitlements located in  the constrained area that were used in
the hour to serve such  Electrical Load, taking into account Firm Contracts and
System  Contracts between Participants and electrical losses, if and  as
appropriate.

(ii) The System Operator shall identify for each Participant and
Non-Participant the megawatt hours, if any, of the rights of  that Participant
or Non-Participant to use the then effective  transfer capability across the
constrained interface.

(iii)     The System Operator shall identify for each Participant  and
Non-Participant the megawatt hours, if any, by which the  amount determined
pursuant to clause (i) above for that  Participant or Non-Participant exceeds
the amount determined  for that Participant or Non-Participant pursuant to
clause  (ii) above.  If the clause (i) amount exceeds the clause (ii)  amount,
the Participant or Non-Participant shall be  responsible for paying a share of
the aggregate Congestion  Costs in proportion to the Participant's or
Non-Participant's  share of the aggregate amount of such excesses for all
Participants and Non-Participants, and such Congestion Costs  shall be
included, as a transmission charge, in the Regional  Network Service, Internal
Point-to-Point Service or Through or  Out Service charge, whichever is
applicable.

(c)  As used in this Section 14.14, the "Congestion Cost" of an out-of- merit
resource for an hour means the product of (i) the difference  between its
Dispatch Price and the Energy Clearing Price for the  hour, times (ii) the
number of megawatt hours of out-of-merit  generation produced by the resource
for the hour.

14.15     Additional Uplift Charges.  It is recognized that the System
Operator may be required from time to time to dispatch resources out of  merit
for reasons other than those covered by Section 14.14 of this  Agreement and
Section 24 of the Tariff.  Accordingly, if and to the  extent appropriate,
feasible and practical, dispatch and operational  costs shall be categorized
and allocated as uplift costs to those  Participants and Non-Participants that
are responsible for such costs.   Such allocations shall be determined in
accordance with market operation  rules that are consistent with this Agreement
and any applicable  regulatory requirements and approved by the Regional Market
Operations  Committee prior to the activation of the Participants Committee or
the  Participants Committee thereafter.

PART FOUR

TRANSMISSION PROVISIONS

SECT65535ON 15

OPERATION OF TRANSMISSION FACILITIES

15.1 Definition of PTF.  PTF or pool transmission facilities are the
transmission facilities owned by Participants rated 69 kV or above  required to
allow energy from significant power sources to move freely  on the New England
transmission network, and include:

1.   All transmission lines and associated facilities owned by  Participants
rated 69 kV and above, except for lines and associated  facilities that
contribute little or no parallel capability to the  NEPOOL Transmission System
(as defined in the Tariff).  The  following do not constitute PTF:

(a)  Those lines and associated facilities which are required to  serve local
load only.

(b)  Generator leads, which are defined as radial transmission from  a
generation bus to the nearest point on the NEPOOL  Transmission System.

(c)  Lines that are normally operated open.

2.   Parallel linkages in network stations owned by Participants  (including
substation facilities such as transformers, circuit  breakers and associated
equipment) interconnecting the lines which  constitute PTF.

3.   If a Participant with significant generation in its transmission  and
distribution system (initially 25 MW) is connected to the New  England network
and none of the transmission facilities owned by  the Participant qualify to be
included in PTF as defined in (1) and  (2) above, then such Participant's
connection to PTF will  constitute PTF if both of the following requirements
are met for  this connection:

(a)  The connection is rated 69 kV or above.

(b)  The connection is the principal transmission link between  the Participant
and the remainder of the New England PTF  network.

4.   Rights of way and land owned by Participants required for the
installation of facilities which constitute PTF under (1), (2)  or (3) above.

The Reliability Committee shall review at least annually the status  of
transmission lines and related facilities and determine whether  such
facilities constitute PTF and shall prepare and keep current a  schedule or
catalogue of PTF facilities.

The following examples indicate the intent of the above  definitions:

(i)  Radial tap lines to local load are excluded.

(ii) Lines which loop, from two geographically separate points  on the NEPOOL
Transmission System, the supply to a load  bus from the NEPOOL Transmission
System are included.

(iii)     Lines which loop, from two geographically separate  points on the
NEPOOL Transmission System, the connections  between a generator bus and the
NEPOOL Transmission  System are included.

(iv) Radial connections or connections from a generating  station to a single
substation or switching station on  the NEPOOL Transmission System are
excluded, unless the  requirements of paragraph (3) above are met.

Transmission facilities owned by a Related Person of a Participant  which are
rated 69 kV or above and are required to allow Energy  from significant power
sources to move freely on the New England  transmission network shall also
constitute PTF provided (i) such  Related Person files with the Secretary of
the Participants  Committee its consent to such treatment; and (ii) the
Participants  Committee determines that treatment of the facility as PTF will
facilitate accomplishment of NEPOOL's objectives.  If a facility  constitutes
PTF pursuant to this paragraph, it shall be treated as  "owned" by a
Participant for purposes of the Tariff and the other  provisions of Part Four
of the Agreement.

15.2 Maintenance and Operation in Accordance with Good Utility Practice.   Each
Participant which owns or operates PTF or other transmission  facilities rated
69 kV or above shall, to the fullest extent  practicable, cause all such
transmission facilities owned or operated by  it to be designed, constructed,
maintained and operated in accordance  with Good Utility Practice.

15.3 Central Dispatch.  Each Participant which owns or operates PTF or other
transmission facilities rated 69 kV or above shall, to the fullest  extent
practicable, subject all such transmission facilities owned or  operated by it
to central dispatch by the System Operator; provided,  however, that each
Participant shall at all times be the sole judge as  to whether or not and to
what extent safety requires that at any time  any of such facilities will be
operated at less than their full  capability or not at all.

15.4 Maintenance and Repair.  Each Participant shall, to the fullest extent
practicable: (a) cause transmission facilities owned or operated by it  to be
withdrawn from operation for maintenance and repair only in  accordance with
maintenance schedules reported to and published by the  System Operator in
accordance with procedures approved or established by  the Tariff Committee
from time to time, (b) restore such facilities to  good operating condition
with reasonable promptness, and (c) in  emergency situations, accelerate
maintenance and repair at the  reasonable request of the System Operator in
accordance with rules  approved by the Tariff Committee.

15.5 Additions to or Upgrades of PTF.  The possible need for an addition to  or
upgrade of PTF may be identified in connection with an application or  request
for service under the Tariff, or in connection with a request  for the
installation of or material change to a generation or  transmission facility,
or may be separately identified by a NEPOOL  committee, a Participant or the
System Operator.  In such cases, a  study, if necessary, to assess available
transmission capacity and, if  necessary, a System Impact Study and a Facility
Study shall be performed  by the affected Participant(s) in whose Local
Network(s) the addition or  upgrade would or might be effected or their
designee(s), or the  Reliability Committee and/or the System Operator, in the
case of a  System Impact Study, or the Committee's or the System Operator's
designee(s) with review of the study by the System Operator if it does  not
perform the study.  Studies to assess available transmission  capacity and
System Impact Studies and Facilities Studies shall be  conducted, as
appropriate, in accordance with the affected Participant's  Local Network
Service Tariff, or in accordance with the applicable  methodology specified in
Attachments C and D to the Tariff, and the  provisions of the Local Network
Service Tariff or the applicable  provisions of Attachments I and J to the
Tariff shall apply, as  appropriate, with respect to the payment of the costs
of the study and  the other matters covered thereby.

If any of the studies referred to above indicates that new PTF  facilities or a
facility modification or other PTF upgrades are  necessary to provide the
requested service, or in connection with a new  or modified generation or
transmission facility, or otherwise in order  to ensure adequate, economic and
reliable operation of the bulk power  supply systems of the Participants for
regional purposes, whether or not  a particular customer is benefited, upon
approval of the studies by the  Reliability Committee, subject to review by the
System Operator, one or  more Transmission Providers shall be designated by the
Reliability  Committee, subject to review by the System Operator, to design and
effect the construction or modification.

Upon the designation of a Transmission Provider to design and effect a  PTF
addition or upgrade and the fixing of the cost responsibilities of  the
Participants and Non-Participants and agreement as to the security  and other
provisions of said arrangement, the Transmission Provider  designated to
perform the construction shall, in accordance with the  terms of such
arrangement and subject to Sections 18.4 and 18.5, use its  best efforts to
obtain any necessary public approvals or permits, to  acquire any required
rights of way or other property, and to effect the  proposed construction or
modification.

Responsibility for the costs of new PTF or any modification or other  upgrade
of PTF shall be determined, to the extent applicable, in  accordance with Parts
V and VI and Schedule 11 of the Tariff, including  without limitation the
provisions relating to responsibility for the  costs of new PTF or
modifications or other upgrades to PTF exceeding  regional system, regulatory
or other public requirements set forth in  paragraph (ii) of Schedule 11 to the
Tariff.

SECT65535ON 16

SERVICE UNDER TARIFF

16.1 Effect of Tariff.  The Tariff specifies the terms and conditions under
which the Participants will provide regional transmission service  through
NEPOOL.  This Section 16 specifies various rights and  obligations with respect
to the revenues to be collected by NEPOOL for  the Participants under the
Tariff and related matters.

16.2 Obligation to Provide Regional Service.  The Participants which own PTF
shall collectively provide through NEPOOL regional transmission service  over
their PTF facilities, and the facilities of their Related Persons  which
constitute PTF in accordance with Section 15.1, to other  Participants and
other Eligible Customers pursuant to the Tariff.  The  Tariff provides open
access for all of the types of regional  transmission service required by
Participants and other Eligible  Customers over PTF and it is intended to be
the only source of such  service, except for service provided for Excepted
Transactions.

16.3 Obligation to Provide Local Network Service.  Each Participant which  owns
transmission facilities other than PTF shall provide service over  such
facilities to other Participants or other Eligible Customers  connected to the
Transmission Provider's transmission system pursuant to  a tariff (a "Local
Network Service Tariff") filed by the Transmission  Provider with the
Commission.  A Participant is also obligated to  provide service under its
Local Network Service Tariff or otherwise (i)  to permit a Participant or other
Entity with an Entitlement in a  generating unit in the Participant's local
network to deliver the output  of the generating unit to an interconnection
point on PTF and (ii) to  permit the delivery to an Eligible Customer taking
Internal Point-to- Point Service under the Tariff of the Energy and/or capacity
covered by  its Completed Application for that Internal Point-to-Point Service.


A Local Network Service Tariff shall provide:

(i)  for a pro rata allocation of monthly revenue requirements not  otherwise
paid for through charges to Eligible Customers for Local  Point-to-Point
Service among the Transmission Provider's Network  Customers receiving service
under the tariff on the basis of their  loads during the hour in the month in
which the total connected  load to the Local Network is at its maximum, without
any adjustment  for credits for generation;

(ii) for the recovery under the Local Network Service Tariff from  Eligible
Customers taking Regional Network Service and Internal  Point-to-Point Service
of that portion of the Transmission  Provider's annual transmission revenue
requirements with respect to  PTF which is not recovered through the
distribution of revenues  from Regional Network Service or Internal
Point-to-Point Service  pursuant to Section 16.6;

(iii)     that where all or a part of the load of a Participant or other
Eligible Customers taking service under the tariff is connected  directly to
PTF, the Participant or other Eligible Customers  receiving the service shall
pay each Year during the Transition  Period for such service with respect to
the load directly connected  to PTF the percentage specified in the schedule
below of the  applicable Local Network Service Tariff charge for service across
non-PTF transmission facilities and shall have no obligation to pay  charges
for service across non-PTF transmission facilities with  respect to that
portion of the connected load after the Transition  Period, but shall continue
to pay its share of any other Local  Network Service costs directly associated
with the PTF-connected  load; provided that in the event of any inconsistency
between the  foregoing provisions and the terms of any Excepted Transaction
which is listed in Attachment G-1 to the Tariff, the Excepted  Transaction
shall control:

Year  One
% of charge to be paid  100%

Year  Two
% of charge to be paid  80%

Year  Three
% of charge to be paid  60%

Year  Four
% of charge to be paid  40%

Years   Five  and Six
% of charge to be paid  20%

     (iv) that if the Transmission Provider receives a distribution pursuant
to Section 16.6 from NEPOOL out of revenues paid for Through or Out  Service or
for In Service (as defined in the Tariff), the amounts  received shall reduce
its Local Network Service revenue  requirements; and

     (v)  that if the Transmission Provider receives transmission revenues
from an Eligible Customer taking Local Network Service from that  Transmission
Provider with respect to an Excepted Transaction, the  amounts received shall
reduce the amount due from such Eligible  Customer connected to the
Transmission Provider's transmission  system for Local Network Service provided
thereto by the  Transmission Provider rather than reducing the Transmission
Provider's total cost of service, except that any reductions to the  amount due
from Eligible Customers for Excepted Transactions  identified in Section 25(1)
and (2) of the Tariff shall be made  only for service rendered through February
28, 1999, and such  reductions shall cease and shall be replaced thereafter in
their  entirety with the credits under the NEPOOL Tariff, provided in
accordance with Sections 25A and 25B of the Tariff.

16.4 Transmission Service Availability.  The availability of transmission
capacity to provide transmission service under the Tariff shall be  determined
in accordance with the Tariff.  In determining the  availability of
transmission capacity, existing committed uses of the  Participants'
transmission facilities shall include uses for existing  firm loads and
reasonably forecasted changes in such loads, and for  Excepted Transactions.

16.5 Transmission Information.  Information concerning (i) available
transmission capacity, (ii) transmission rates and (iii) system  conditions
that may give rise to Interruptions or Curtailments shall be  made available to
all Participants and Non-Participants through the  OASIS on a timely and
non-discriminatory basis.  All Participants owning  PTF or other transmission
facilities rated 69 kV or higher shall make  available to the System Operator
the information required to permit the  maintenance of the OASIS in compliance
with Commission Order 889 and any  other applicable Commission orders; provided
that no Participant shall  be required to furnish information which is required
to be treated as  confidential in accordance with NEPOOL policy without
appropriate  arrangements to protect the confidentiality of such information.

16.6 Distribution of Transmission Revenues.  Payments required by the Tariff
for the use of the NEPOOL Transmission System shall be made to NEPOOL  and
shall be distributed by it in accordance with this Section 16.6.

A.   Regional Network Service Revenues.  Revenues received by NEPOOL for
providing Regional Network Service each month during the Transition  Period
shall be distributed to those Participants owning PTF or  those load-serving
Participants supporting PTF which are obligated  to take and pay for Regional
Network Service and/or Internal Point- to-Point Service in accordance with the
Tariff, in part on the  basis of allocated flows for the region as determined
in accordance  with the methodology specified in Attachment A to this Agreement
and in part in proportion to the respective Annual Transmission  Revenue
Requirements for PTF of such owners and supporters, in  accordance with the
following Schedule:

Year One
Allocated  Flows:
25%
Annual Transmission Revenue Requirements:
75%

Year Two
Allocated  Flows:
20%
Annual Transmission Revenue Requirements:
80%

Year Three
Allocated  Flows:
15%
Annual Transmission Revenue Requirements:
85%

Year Four
Allocated  Flows:
10%
Annual Transmission Revenue Requirements:
90%

Year Five
Allocated  Flows:
5%
Annual Transmission Revenue Requirements:
95%

Year Six
Allocated  Flows:
2.5%
Annual Transmission Revenue Requirements:
97.5%

Revenues received by NEPOOL for providing Regional Network Service  each month
after the Transition Period shall be distributed to the  Participants owning or
supporting PTF in proportion to their  respective Annual Transmission Revenue
Requirements for PTF.

B.   Through or Out Service Revenues.  The revenues received by NEPOOL  each
month for providing Through or Out Service shall be  distributed among the
Participants owning PTF on the basis of  allocated flows for the transaction
determined in accordance with  the methodology specified in Attachment A to
this Agreement;  provided that for service provided during the Transition
Period but  not thereafter, for an "Out" transaction which originates on the
system of a Participant which owns the PTF interconnection  facilities on the
New England side of the interface with the other  Control Area over which the
transaction is delivered, 100% of the  megawatt mile flows with respect to the
transaction shall be deemed  to occur on such Participant's system.

C.   Internal Point-to-Point Service Revenues.  The revenues received by
NEPOOL each month for providing Internal Point-to-Point Service  shall be
distributed among those load-serving Participants owning  or supporting PTF
which are obligated to take and pay for Regional  Network Service and/or
Internal Point-to-Point Service in  accordance with the Tariff, in proportion
to their respective  Annual Transmission Revenue Requirements for PTF under
Attachment F  to the Tariff.

D.   Ancillary Service Payments.  The revenues received by NEPOOL  pursuant to
Schedule 1 to the Tariff (scheduling, system control  and dispatch service)
will be used to reimburse NEPOOL, the System  Operator (if the System Operator
does not receive revenues for that  service under a separate tariff) and
Participants for the costs  which are reflected in the charges for such
service.  The revenues  received by NEPOOL pursuant to Schedules 2-7 to the
Tariff shall be  distributed prior to the Second Effective Date in accordance
with  the continuing provisions of the Prior NEPOOL Agreement and the  rules
adopted thereunder, and shall be distributed on or after the  Second Effective
Date in accordance with Section 14.

E.   Congestion Payments.  Any congestion uplift charge received as a  payment
for transmission service pursuant to Section 24 of the  Tariff for any hour
shall be applied in accordance with Section  14.5(a) in payment for Energy
service.

SECT65535ON 17

POOL-PLANNED UNIT SERVICE

17.1 Effective Period.  The provisions contained in this Section 17 shall
continue in effect for the period to and including February 28, 2001,  and
shall be of no effect after that date.

17.2 Obligation to Provide Service.  Until February 28, 2001, each  Participant
shall provide service over its PTF facilities under this  Section 17 rather
than under the Tariff, for the following purposes:

(a)  the transfer to a Participant's system of its ownership interest or  its
Unit Contract Entitlement under a contract entered into by it  before November
1, 1996 in a Pool-Planned Unit which is off its  system;

(b)  the transfer to a Participant's system of its Entitlement in a  purchase
under a contract entered into by it before November 1,  1996 (including a
purchase under the HQ Phase II Firm Energy  Contract) from Hydro-Quebec where
the line over which the transfer  is made into New England is the HQ
Interconnection; and

(c)  the transfer to a Non-Participant of its Entitlement in a Pool- Planned
Unit pursuant to an arrangement which has been approved  prior to November 1,
1996 by the Participants Committee.

17.3 Rules for Determination of Facilities Covered by Particular  Transactions.
It is anticipated that it may be necessary with respect  to a particular
transmission use under subsection (a), (b) or (c) of  Section 17.2 to determine
whether the transaction is effected entirely  over PTF, entirely over
facilities that are not PTF, or partially over each.

The following rules shall be controlling in the determination of the
facilities required to effect the use:

(a)  To the extent that EHV PTF is available to effect the transaction,  over
all or part of the distance to be covered, the use shall be  deemed to be
effected on such EHV PTF over such portion of the  distance to be covered.

(b)  To the extent that EHV PTF is not available for the entire distance  to be
covered by the use, but Lower Voltage PTF is available to  cover all or part of
the distance not covered by EHV PTF, the  transaction shall be deemed to be
effected on such Lower Voltage  PTF.    If a Participant has ownership or
contractual rights with respect  to an Excepted Transaction which are
independent of this Agreement  and the Tariff and are adequate to provide for a
transfer of the  types specified in subsections 17.2(a), (b) or (c), and such
rights  are not limited to the transfer in question, the transfer shall be
deemed to have been effected pursuant to such rights and not  pursuant to the
provisions of this Agreement.  A copy of each  instrument establishing such
rights, or an opinion of counsel  describing and authenticating such rights,
shall be filed with the  Secretary of the Participants Committee.

17.4 Payments for Uses of EHV PTF During the Transition Period.

(a)  Each Participant shall pay each month for its uses of EHV PTF for
transfers of Entitlements pursuant to subsections (a) or (b) of  Section 17.2,
one-twelfth of the NEPOOL EHV PTF Participant Summer  or Winter Wheeling Rate
in effect for the calendar year ending  December 31, 1996, as determined in
accordance with the Prior  NEPOOL Agreement, for each Kilowatt of its current
Entitlements  which qualify for transfer pursuant to subsections (a) or (b) of
Section 17.2, except as otherwise provided in Section 17.3;  provided that such
payment shall be required with respect to only  one-half the Kilowatts covered
by a NEPOOL Exchange Arrangement (as  hereinafter defined).

Each Participant which is a party to the HQ Phase II Firm Energy  Contract
(other than a Participant (i) whose system is directly  interconnected to the
HQ Interconnection or (ii) which has  contractual rights independent of this
Agreement and the Tariff  which give it direct access to the HQ Interconnection
and which are  not limited to transfers of Energy delivered over the HQ
Interconnection) shall also pay each month for the use of EHV PTF  for
deliveries under the Phase II Firm Energy Contract during the  Base Term of the
HQ Phase II Firm Energy Contract, one-twelfth of  the NEPOOL EHV PTF
Participant Summer or Winter Wheeling Rate in  effect for the calendar year
ending December 31, 1996, as  determined in accordance with the Prior NEPOOL
Agreement, for each  Kilowatt of its HQ Phase II Net Transfer Responsibility
for the  month.  If, and to the extent that, such Responsibility continues  for
any period by which the term of said Contract extends beyond  the Base Term,
each such Participant shall continue to pay the  above rate during the
extension period with respect to its  continuing Responsibility.  A Participant
shall not be deemed to be  directly interconnected to the HQ Interconnection
for purposes of  this paragraph solely because of its participation in
arrangements  for the support and/or use of PTF facilities installed or
modified  to effect reinforcements of the New England AC transmission system
required in connection with the HQ Interconnection.  A copy of each  contract
establishing rights independent of this Agreement and the  Tariff which
provides direct access to the HQ Interconnection, or  an opinion of counsel
describing and authenticating such rights,  shall be filed with the Secretary
of the Participants Committee.

The NEPOOL EHV PTF Participant Summer Wheeling Rate for any  calendar year
shall be applicable to the months in the Summer  Period.

The NEPOOL EHV PTF Participant Winter Wheeling Rate for any  calendar year
shall be applicable to the months in the Winter  Period.

A NEPOOL Exchange Arrangement is one entered into by two  Participants each of
which has an ownership interest in a Pool- Planned Unit on its own system
pursuant to which each sells out of  its ownership interest, a Unit Contract
Entitlement to the other  for a period of time which is, in whole or part, the
same for both  sales.  Such an arrangement shall constitute a NEPOOL Exchange
Arrangement even though the beginning and ending dates of the two  Unit
Contract sale periods are different, but only for the period  for which both
sales are in effect.  If for any period the number  of Kilowatts covered by the
two Unit Contract Entitlements of a  NEPOOL Exchange Agreement are not the
same, the portion of the  larger Entitlement which exceeds the amount of the
smaller  Entitlement shall not be deemed to be covered by such NEPOOL  Exchange
Arrangement for purposes of this Section 17.4.

(b)  Each Participant shall pay each month for its use of EHV PTF for a
transfer of an Entitlement in a Pool-Planned Unit to a Non- Participant
pursuant to Section 17.2(c) such charge as is fixed by  the Participants
Committee at the time of its approval of the sale,  and filed with the
Commission.

(c)  Fifty percent of all amounts required to be paid with respect to
transfers by a Participant pursuant to subsection (a) or (b) of  Section 17.2
shall be paid to a pool transmission fund and  distributed monthly among the
Participants in proportion to the  respective amounts of their costs with
respect to EHV PTF for the  calendar year 1996 as determined in accordance with
the Prior  NEPOOL Agreement.

(d)  The remaining 50% of all amounts required to be paid with respect  to
transfers by a Participant pursuant to subsections (a) or (b) of  Section 17.2
shall be paid to, and retained by, the Participant on  whose system the
transfer originates, or in the event the EHV PTF  system of such Participant is
supported in part by other  Participants, then to the Participant on whose
system the transfer  originates and such other Participants in proportion to
the  respective shares of the costs of such EHV PTF system borne by each  of
them or in such other manner as the Participants involved may  jointly direct;
provided that the Participant on whose system the  transfer originates shall
have the right to waive such 50% payment  in whole or part as to a particular
transfer except that no such  waiver may adversely affect the payments to any
other Participant  which is supporting in part the originating system's EHV PTF
system.

17.5 Payments for Uses of Lower Voltage PTF.  Each Participant which uses
another Participant's Lower Voltage PTF pursuant to this Section 17  shall pay
each month to the owner of such Lower Voltage PTF (1) for each  Kilowatt of its
use of such Lower Voltage PTF for transfer of  Entitlements pursuant to
Subsections 17.2(a), (b) or (c) during the  month, and (2) during the Base Term
of the HQ Phase II Firm Energy  Contract (and during any extension of the term
of said Contract if and  to the extent its HQ Phase II Net Transfer
Responsibility continues  during the extension period) for each Kilowatt of its
HQ Phase II Net  Transfer Responsibility for the month, the owner's Lower
Voltage PTF  Winter Wheeling Rate or Summer Wheeling Rate for the 1996 calendar
year,  as determined in accordance with the Prior NEPOOL Agreement; except that
the requirements for such payments shall terminate on March 1, 1999 for
Participants receiving network service under both the Tariff and  applicable
Local Network Service Tariff.

17.6 Use of Other Transmission Facilities by Participants.  For the period to
and including February 28, 1999, each Participant which has no direct
connection between its system and PTF shall be entitled to use the non- PTF
transmission facilities of any other Participant required to reach  its system
for any of the purposes for which PTF may be used under  Section 17.2.  Such
use shall be effected, and payment made, in  accordance with the other
Participant's filed open access tariff.

17.7 Limits on Individual Transmission Charges.  Any charges for transmission
service pursuant to this Section 17 by any Participant to another  Participant
shall be just, reasonable and not unduly discriminatory or  preferential.  No
provision of this Section 17 shall be construed to  waive the right of any
Participant to seek review of any charge, term or  condition applicable to such
transmission service by another Participant  by the Commission or any other
regulatory authority having jurisdiction  of the transaction.

SECTION 17A

TRANSMISSION OWNERS RESERVED RIGHTS

Notwithstanding any other provision of this Agreement, or any other  agreement
or amendment made in connection with the restructuring of NEPOOL,  each
Transmission Owner shall retain all of the rights set forth in this  Section
17A; provided, however, that such rights shall be exercised in a  manner
consistent with the Transmission Owner's rights and obligations under  the
Federal Power Act and the Commission's rules and regulations thereunder.

17A.1     Each Transmission Owner shall have the right at any time
unilaterally to file pursuant to Section 205 of the Federal Power Act to
change the revenue requirements underlying its component of the rates  for
service under the NEPOOL Tariff and the transmission-related  provisions of
this Agreement.

17A.2     Nothing in this Agreement shall restrict any rights, to the extent
such rights exist: (a) of Transmission Owners that are parties to a  merger,
acquisition or other restructuring transaction to make a filing  under Section
205 of the Federal Power Act with respect to the  reallocation or
redistribution of revenues among such Transmission  Owners; or (b) of any
Transmission Owner to terminate its participation  in NEPOOL pursuant to
Section 21.2 of this Agreement, notwithstanding  any effect its withdrawal from
NEPOOL may have on the distribution of  transmission revenues among other
Transmission Owners.   Further,  nothing in this Agreement shall be interpreted
to permit the adoption of  a rate design change that is inconsistent with any
settlement under the  Tariff accepted by the Commission without the consent of
all signatories  to the settlement.

17A.3     Each Transmission Owner retains all rights that it otherwise has
incident to its ownership of its assets, including, without limitation,  its
PTF and non-PTF, including the right to build, acquire, sell, merge,  dispose
of, retire, use as security, or otherwise transfer or convey all  or any part
of its assets, including, without limitation, the right,  individually or
collectively, to amend or terminate the Transmission  Owner's relationship with
the ISO in connection with the creation of an  alternative arrangement for the
ownership and/or operation of its  transmission facilities on an unbundled
basis (e.g., a transmission  company), subject to necessary regulatory
approvals and to any approvals  required under applicable provisions of this
Agreement.  This section is  not intended to reduce or limit any other rights
of a Transmission Owner  as a signatory to this Agreement.

17A.4     The obligation of any Transmission Owner to expand or modify its
transmission facilities in accordance with the Tariff shall be subject  to the
Transmission Owners' right to recover, pursuant to appropriate  financial
arrangements contained in Commission-accepted tariffs or  agreements, all
reasonably incurred costs, plus a reasonable return on  investment, associated
with constructing and owning or financing such  expansions or modifications to
its facilities.

17A.5     Each Transmission Owner shall have the right to adopt and implement
procedures it deems necessary to protect its electric facilities from  physical
damage or to prevent injury or damage to persons or property.

17A.6     Each Transmission Owner retains the right to take whatever actions
it deems necessary to fulfill its obligations under local, state or  federal
law.

17A.7     In addition to having the rights reserved under other provisions of
this Section 17A, all Participants retain the right to take any position
before the Commission, and any appellate court with jurisdiction to  review a
Commission determination, or to seek a determination by the  Commission,
regarding whether, and the extent to which, the Transmission  Owners may retain
the exclusive right to make unilateral filings under  Section 205 of the
Federal Power Act to amend the Tariff and the  transmission related provisions
of this Agreement.  If and to the extent  the Commission rules that the
Transmission Owners do not retain such  rights, then any such amendment that is
not subject to any of Section  17A.1 through 17A.6 may be filed with the
Commission only upon the  approval by the Participants Committee of the
amendment under Section  6.11, including Section 6.11(d).  If and to the extent
the Commission  rules that the Transmission Owners do retain such rights, then
the  Transmission Owners, acting through the Transmission Owners Committee,
shall have the exclusive right to make unilateral filings under Section  205 of
the Federal Power Act to amend the Tariff and the transmission- related
provisions of this Agreement, other than filings subject to  Sections 17A.1 or
17A.2.

17A.8     (a)  Notwithstanding anything to the contrary in this Agreement,  the
rights of each Participant under the Federal Power Act shall be  preserved.

(b)  Any dispute over whether a matter falls within the scope of any of  the
rights reserved under this Section 17A will be subject to resolution  pursuant
to Section 11.A.

(c)  No amendment to any provision of this Section 17A or Section 11B  may be
adopted without the agreement of the Transmission Owners  specified in Section
11B.

(d)  Any agreement entered into between NEPOOL and a System Operator  shall
require the System Operator to respect the rights reserved under  this Section
17A.


PART FIVE

GENERAL

SECT65535ON 18

GENERATION AND TRANSMISSION FACILITIES

18.1 Designation of Pool-Planned Facilities.  At the request of a  Participant,
the Participants Committee shall designate as "pool- planned" a generating or
transmission facility to be constructed by the  Participant or its Related
Person if the Participants Committee  determines that the facility is
consistent with NEPOOL planning.  The  Participants Committee may not
unreasonably withhold designation as a  Pool-Planned Facility of a generation
unit or other facility proposed by  one or more Participants in order to
satisfy their anticipated Installed  Capability Responsibilities with a mix of
generation and other resources  reasonably comparable as to economics and types
to that being developed  for New England.

18.2 Construction of Facilities.  Subject to Sections 13.1, 15.2, 15.5, 18.3,
18.4 and 18.5, and to the provisions of the Tariff, each Participant  shall
have the right to determine whether, and to what extent, additions  to and
modifications in its generating and transmission facilities shall  be made.
However, each Participant shall give due consideration to  recommendations made
to it by the Participants Committee or the System  Operator for any such
additions or modifications and shall follow such  recommendations unless it
determines in good faith that the recommended  actions would not be in its best
interest.

18.3 Protective Devices for Transmission Facilities and Automatic Generation
Control Equipment.  Each Participant shall install, maintain and operate such
protective  equipment and switching, voltage control, load shedding and
emergency  facilities as the Participants Committee may determine to be
required in  order to assure continuity of service and the stability of the
interconnected transmission facilities of the Participants. Until the  Second
Effective Date, each Participant shall also install, maintain and  operate such
Automatic Generation Control equipment as the Participants  Committee may
determine to be required in order to maintain proper  frequency for the
interconnected bulk power system of the Participants  and to maintain proper
power flows into and out of the NEPOOL Control  Area.

18.4 Review of Participant's Proposed Plans.  Each Participant shall submit  to
the System Operator, Participants Committee, the Reliability  Committee, and
the Markets Committee or the Tariff Committee, as  appropriate, for review by
them, in such form, manner and detail as the  Participants Committee may
reasonably prescribe, (i) any new or  materially changed plan for additions to,
retirements of, or changes in  the capacity of any supply and demand-side
resources or transmission  facilities rated 69 kV or above subject to control
of such Participant,  and (ii) any new or materially changed plan for any other
action to be  taken by the Participant which may have a significant effect on
the  stability, reliability or operating characteristics of its system or the
system of any other Participant.  No significant action (other than
preliminary engineering action) leading toward implementation of any  such new
or changed plan shall be taken earlier than sixty days (or  ninety days, if the
System Operator or the Participants Committee  determines that it requires
additional time to consider the plan and so  notifies the Participant in
writing within the sixty days) after the  plan has been submitted to the
Committees.  Unless prior to the  expiration of the sixty or ninety days,
whichever is applicable, the  Participants Committee notifies the Participant
in writing that it has  determined that implementation of the plan will have a
significant  adverse effect upon the reliability or operating characteristics
of its  system or of the systems of one or more other Participants, the
Participant shall be free to proceed.  The time limits provided by this
Section 18.4 may be changed with respect to any such submission by  agreement
between the Participants Committee and the Participant  required to submit the
plan.

18.5 Participant to Avoid Adverse Effect.  If the Participants Committee
notifies a Participant pursuant to Section 18.4 that implementation of  the
Participant's plan has been determined to have a significant adverse  effect
upon the reliability or operating characteristics of its system  or the systems
of one or more other Participants, the Participant shall  not proceed to
implement such plan unless the Participant or the Non- Participant on whose
behalf the Participant has submitted its plan takes  such action or constructs
at its expense such facilities as the  Participants Committee determines to be
reasonably necessary to avoid  such adverse effect; provided that if the plan
is for the retirement of  a supply or demand-side resource, the Participant may
proceed with its  plan only if, after engaging in good faith negotiations with
persons  designated by the Participants Committee to address the adverse
effects  on reliability or operating characteristics, the negotiations either
address the adverse effects to the satisfaction of the Participants  Committee,
or no satisfactory resolution can be achieved on terms  acceptable to the
parties within 90 days of the Participant's receipt of  the Participants
Committee's notice.  Any agreement resulting from such  negotiations shall be
in writing and shall be filed in accordance with  the Commission's filing
requirements if it requires any payment.

SECT65535ON 19

EXPENSES

19.1 Annual Fee.  Each Participant shall pay to NEPOOL in January of each  year
an annual fee, which shall be applied toward NEPOOL expenses, as  follows:

(a)  Each End User Participant which is a non-profit residential or  small
business consumer, or non-profit group representing such  entities, shall pay
an annual fee of $500.

(b)  Each End User Participant, other than non-profit residential or  small
business consumers or non-profit groups representing such  entities, shall pay
an annual fee of $500; plus an additional fee  of $500 per megawatt hour of its
highest Energy use during any hour  in the preceding year (net of any use of
on-site generation) up to  a maximum of $5,000; plus an additional fee of $200
per megawatt  hour for each megawatt hour by which its highest Energy use
during  any hour in the preceding year (net of any use of on-site  generation
during such hour) exceeded 20 megawatt hours.

(c)  Each Participant which is a Publicly Owned Entity and a member of  the
Publicly Owned Entity Sector shall pay an annual fee of $5,000,  except that
any such Participant which is engaged in electricity  distribution and had
annual Energy sales of less than 30,000  megawatt hours in the preceding year
shall pay an annual fee of  $500, and the difference between $5,000 and $500
for each such  Participant shall be paid, as an additional fee, by the
remaining  Participants which are Publicly Owned Entities and members of the
Publicly Owned Entity Sector.

(d)  Each Participant other than an End User Participant or a Publicly  Owned
Entity shall pay an annual fee of $5,000.

19.2 NEPOOL Expenses. Commencing on January 1, 1999, most expenses of the
System Operator are recovered by it directly from Participants and Non-
Participants under the ISO's Tariff for Transmission Dispatch and Power
Administration (the "ISO Tariff") or through direct charges for services
rendered by the ISO, and have ceased to be NEPOOL expenses.  At that  time, the
payment of a portion of NEPEX expenses from the Savings Fund  in accordance
with the Prior NEPOOL Agreement also terminated.

Further, commencing on January 1, 1999 through June 30, 1999, the  balance of
NEPOOL expenses remaining to be paid after the application of  (i) the annual
fee to be paid pursuant to Section 19.1 and (ii) any fees  or other charges for
services or other revenues received by NEPOOL, or  collected on its behalf by
the System Operator, shall, except as  otherwise provided in Section 19.3, be
allocated among and paid monthly  by the Participants in accordance with their
respective voting shares,  as determined in accordance with the Agreement
provisions in effect  during such period.

Commencing as of July 1, 1999, such balance of NEPOOL expenses for July  and
subsequent months shall be divided equally into as many shares as  there are
active Sectors pursuant to Sector 6.2 (other than an End User  Sector) and each
Sector's share shall be paid monthly by the  Participants in each such Sector
(other than an End User Sector) in such  manner as the Participants in each
Sector may determine by unanimous  vote and advise the ISO, provided that if
the Participants in a Sector  fail to agree unanimously on the allocation of
their Sector's share, the  Participants in the Sector shall pay for such Sector
share in the same  proportion as the vote they are entitled to in the Sector.
Participants  in the Sector that are represented by a group voting member shall
subdivide their portion of the Sector's share of expenses in such a  manner as
they may determine by unanimous agreement; provided that if  there is not
unanimous agreement among the Participants represented by a  group member as to
how to allocate their portion of the Sector's share  of expenses, such portion
shall be allocated among the Participants  represented by that group member as
follows: (i) for each Participant in  the Generation Sector represented by a
group voting member, the portion  will be allocated in the same proportion that
the Megawatts of  generation owned by the Participants represents of the total
Megawatts  owned by Participants represented by the group voting member; and
(ii)  for Participants in the Transmission Sector, the portion will be
allocated equally among the Participants represented by the group  member.
Notwithstanding the foregoing, no portion of such balance shall  be paid by End
User Participants and, until such time as an End User  Sector is activated, the
monthly share allocated to the Publicly Owned  Entity Sector shall be reduced
by one-twelfth of the aggregate annual  fees paid by End Users for the year
pursuant to Section 19.1 and one- third of the amount of such reduction shall
be allocated to each of the  other three Sectors.

19.3 Restructuring Costs.

(a)  The expense of restructuring NEPOOL ("Restructuring Expense"),  including
but not limited to (i) software development, hardware and  system software
costs for implementation of the Tariff and the new  market system, (ii) the
costs of the formation of the Independent  System Operator and related
separation costs, (iii) legal and  consultant costs related to the amendment of
the NEPOOL Agreement  (including the Tariff) and the proceeding with respect
thereto at  the Federal Energy Regulatory Commission, and (iv) capital
expenditures and capitalized project costs of the Independent  System Operator,
shall be funded (to the extent not already funded)  and amortized according to
this Section 19.3.

(b)  The Restructuring Expense incurred (other than certain capital
expenditures and capitalized project costs funded separately by the  ISO)
before the Second Effective Date (the "Early Restructuring  Expense") has been
funded during the period prior to such date by  those entities which have been
the Participants during such period.   Commencing at the Second Effective Date,
the Early Restructuring  Expense shall be amortized in equal monthly amounts
and repaid over  the next 60 months with interest thereon at the rate of 8% per
annum from the date of payment.  Each month during the first twelve  months of
such period each Participant shall pay its percentage  "X", as determined
below, of 1/60th of the Early Restructuring  Expense, plus accumulated
interest, and each Participant or other  Entity which previously paid an
unreimbursed portion of the  aggregate Early Restructuring Expense shall be
entitled to receive  each month its percentage "Y", as determined below, of the
aggregate amount to be paid for the month, including accumulated  interest.
"X" and "Y" shall be determined in accordance with the  following formulas:

  X =          in which

X    is the percentage to be paid for a month by a Participant  of the
aggregate amount payable pursuant to this  subsection (b) by all Participants
for the month.

A    is the amount payable by the Participant for the month  under Schedule 2
(Energy Administration Services) of the  ISO Tariff (as defined in Section
19.2) as amended or  revised from time to time.

A1   is the aggregate amount payable by all Participants for  the month under
Schedule 2 (Energy Administration  Services) of the ISO Tariff as amended or
revised from  time to time.

Y =  in which

Y    is the percentage to be received for a month by a  Participant or other
Entity of the aggregate amount to be  received pursuant to this subsection (b)
by all  Participants or other Entities for the month.

B    is the amount of Early Restructuring Expense paid by the  Participant or
other Entity which has not previously been  reimbursed.

B1   is the aggregate amount of Early Restructuring Expense  paid by all
Participants and other Entities which has not  previously been reimbursed.

(c)  The Restructuring Expense incurred on the Second Effective Date and  to
but not including January 1, 2000 or thereafter shall be funded  each month by
the Participants in proportion to the Member Fixed  Voting Shares (as defined
in Section 6.9(c)) of each Participant as  in effect at the beginning of the
month provided, however, that in  calculating the allocation of this portion of
the Restructuring  Expense, the Member Fixed Voting Shares of End User
Participants  that participate in NEPOOL for governance purposes only in
accordance with NEPOOL's Standard Membership Conditions, Waivers  and Reminders
("Governance Only End User Participants") shall not  be included in such
calculations and the amounts that would  otherwise have been payable by such
Governance Only End User  Participants will be allocated to all of the other
Participants on  the basis of their Member Fixed Voting Shares.

(d)  The Restructuring Expense incurred on or after January 1, 2000 (the  "Late
Restructuring Expense") shall initially be funded for each  month, on an as
incurred basis, by the Participants in proportion  to their charges under the
ISO Tariff for the prior month.  The  aggregate Late Restructuring Expense
funded in any calendar year  shall be amortized in equal monthly amounts and
repaid over the  next 60 months, commencing in January of the immediately
succeeding  calendar year, with interest thereon from the date of payment at
the rate equal to the average Weighted Costs of Capital of all  Transmission
Providers in effect on October 20, 1999 (without  subsequent adjustment)
determined pursuant to Section II(A)(2)(a)  of the Implementation Rule for
Calculating Annual Transmission  Revenue Requirements filed as a supplement to
the Tariff.  Thus,  for example, the Late Restructuring Expense incurred in
2000 will  be amortized and repaid over a 60-month period commencing in
January 2001.  Each month during the applicable amortization period  each
Participant shall pay its share of the portion of the Late  Restructuring
Expense being amortized during such period, plus  accumulated interest, and
each Participant or other Entity which  previously paid an unreimbursed portion
of the aggregate Late  Restructuring Expense being amortized during such period
shall be  entitled to receive its share of the aggregate amount paid for such
month, including accumulated interest, according to an allocation  methodology
that is based on the appropriate schedules of the ISO  Tariff, which allocation
methodology will be established under  subsection (e) below.

(e)  The Participants agree to amend the Agreement within twelve months  after
the Second Effective Date to specify how the balance of the  Early
Restructuring Expense is to be paid.  The Participants agree  to amend the
Agreement by November 1, 2000 to provide for the  amortization and repayment of
the Late Restructuring Expense,  according to an allocation  methodology that
is based on the  appropriate schedules of the ISO Tariff as approved by the
Commission.

(f)  The funding methodology set forth in subsection (d) shall terminate
automatically upon the implementation of a permanent restructuring  funding
methodology acceptable to the Participants Committee and  the ISO, to the
extent superseded by such permanent restructuring  funding methodology.

SECT65535ON 20

INDEPENDENT SYSTEM OPERATOR

(a)  The Participants Committee is authorized and directed to approve  one or
more agreements to be entered into with the ISO (the "ISO  Agreement") and any
amendments to the ISO Agreement which the  Committee may deem necessary or
appropriate from time to time.  The  ISO Agreement shall specify the rights and
responsibilities of  NEPOOL and the ISO, for the continued operation of the
NEPOOL  control center by the ISO as the control center operator for the
NEPOOL Control Area and the administration of the Tariff.  In  addition, the
ISO shall be responsible for the furnishing of  billing and other services
required by NEPOOL.

(b)  The fees and charges of the ISO (other than those recovered under  the ISO
Tariff, as defined in Section 19.2, and fees and charges  for services which
are separately billed), and any indemnification  payable under the ISO
Agreement, shall be shared by the  Participants in accordance with Section 19.

(c)  The Participants shall provide to the ISO the financial support,
information and other resources necessary to enable the ISO to  provide the
services specified in the ISO Agreement, or in this  Agreement, in accordance
with Good Utility Practice and subject to  the budgeting, approval and dispute
resolution provisions of the  ISO Agreement and this Agreement.

(d)  The Participants shall provide appropriate funding for the  acquisition of
land, structures, fixtures, equipment and  facilities, and other capital
expenditures and capitalized project  expenditures for the ISO, which are
included in the annual budget  for the ISO in accordance with the provisions of
the ISO Agreement,  or otherwise specifically approved by the Participants
Committee.   All such land, structures, fixtures, equipment and facilities, and
other capital assets, and all software or other intellectual  property or
rights to intellectual property or other assets  acquired or developed by the
ISO in order to carry out its  responsibilities under the ISO Agreement shall
be the property of  the Participants or shall be acquired by the Participants
under  lease in accordance with arrangements approved by the Participants
Committee.  For those Participants subject to the Public Utility  Holding
Company Act of 1935 ("PUHCA"), any such acquisition by  those Participants is
subject to PUHCA approval to the extent such  acquisition requires approval
under PUHCA.  Unless otherwise agreed  by the Participants, the funding of the
acquisition, or lease, of  land, structures, fixtures, equipment and
facilities, and other  capital and/or capitalized project related expenditures,
or the  acquisition of other assets, and the ownership thereof, or the
obligations of Participants as lessees, shall be in accordance with  Section
19.3 of this Agreement.  The Participants shall make all  such assets
(including the assets of the existing NEPOOL  headquarters and control center)
available for use by the ISO in  carrying out its responsibilities under the
ISO Agreement.  The ISO  Agreement shall require the ISO, on behalf of the
Participants, to  maintain and care for, insure as appropriate, and pay any
property  taxes relating to, assets made available for its use.

(e)  The ISO Agreement shall require the ISO to refrain from any action  that
would create any lien, security interest or encumbrance of any  kind upon the
facilities, equipment or other assets of any  Participant, or upon anything
that becomes affixed to such  facilities, equipment or other assets.  The
Participants and the  ISO shall include in the ISO Agreement a provision that,
upon the  request of any Participant, the ISO shall (i) provide a written
statement that it has taken no action that would create any such  lien,
security interest or encumbrance, and (ii) take all actions  within the control
of the ISO, at the direction and expense of the  requesting Participant,
required for compliance by such Participant  with the provisions of its
mortgage relating to such facilities,  equipment or other assets.

(f)  The ISO shall have the right to appoint a non-voting member and an
alternate to each NEPOOL committee other than the Participants  Committee.  The
member appointed to each committee shall have all  of the rights of any other
member of the committee except the right  to vote.

(g)  The ISO shall have the same rights as a Participant to appeal to  the
Participants Committee any action taken by any other NEPOOL  committee, and
shall be entitled to appear before the Participants  Committee on any such
appeal.  Further, the ISO shall be entitled  to submit any dispute with respect
to a vote of the Participants  Committee to approve, modify, or reject a
proposed action to  resolution in accordance with Section 21.1, whether or not
the  action could have been submitted by a Participant in accordance  with
Section 21.1A.  In addition, the ISO shall be entitled to  submit any dispute
with respect to a vote of the Participants  Committee which denies an appeal to
the Participants Committee by  the ISO or which takes action on any rulemaking
issue to the Board  of Directors of the ISO for determination, subject to the
right of  the Participants Committee to seek a review in accordance with the
Alternate Dispute Resolution procedures or by the Commission.  The  ISO shall
give notice of any such submission to the Secretary of  the Participants
Committee within ten days of the action of the  Participants Committee and
shall mail a copy of such notice to each  member of the Participants Committee.
Pending final action on the  submission in accordance with Section 21.1 or by
the Board of  Directors of the ISO or the Commission, as appropriate, the
giving  of notice of the submission shall suspend the Participants  Committee's
action.  Unless the Board of Directors of the ISO acts  within 60 days of the
ISO's notice to the Participants Committee,  the Participants Committee action
will be deemed to be approved.

(h)  The ISO Agreement shall specify the ISO's independent authority  with
respect to rulemaking.

(i)  NEPOOL and its committees and the ISO shall consult and coordinate  from
time to time with the relevant state regulatory, siting and  other authorities
of the six New England states on operating,  planning and other issues of
concern to the states.  The New  England Conference of Public Utilities
Commissioners, Inc.  ("NECPUC") or its designee shall be furnished notices of
meetings  of all NEPOOL committees and the Board of Directors of the ISO, and
minutes of their meetings.  NECPUC and other state authorities  shall be
provided an appropriate opportunity to appear at meetings  of the NEPOOL
committees and the Board of Directors of the ISO and  to present their views.
Representatives of NEPOOL and the ISO  shall be designated to attend meetings
of NECPUC or any committee  or task force of NECPUC, to the extent NECPUC or
its committee or  task force may deem such attendance appropriate.

(j)  Appointment of Technical Committee Officers.  The System Operator  shall,
after its chief executive officer has conferred with the  Participant members
of the Liaison Committee regarding such  appointment(s), appoint the Chair and
Secretary of each of the  Technical Committees.  Each individual appointed by
the System  Operator shall be an independent person not affiliated with any
Participant.  Before appointing an individual to the position of  Chair or
Secretary, the System Operator shall notify the Committee  to which such
officer is being appointed of the proposed assignment  and, consistent with its
personnel practices, provide any other  information about the individual
reasonably requested by the  Committee.  In the event that a Technical
Committee determines that  the performance of the Chair or Secretary of the
Committee is not  satisfactory, the Committee shall provide notice to the
System  Operator that such performance deficiencies must be corrected  within
60 days.  If the Committee determines that the performance  deficiencies have
not been corrected within the 60-day period, the  Committee may vote to remove
the officer, subject to appeal to the  Participants Committee.  A vote of the
Technical Committee to  remove its officer shall be immediately effective and
binding on  the System Operator and shall cause the System Operator to appoint
a replacement officer in accordance with the provisions of this  Section 20(j)
unless an appeal to the Participants Committee has  been taken prior to the end
of the tenth business day following the  vote to remove the officer in which
case the vote for removal shall  be subject to the outcome of such appeal.  A
vote of the  Participants Committee with respect to any such appeal shall be
immediately effective and binding on the System Operator and not  subject to
any further appeals.

SECT65535ON 21

MISCELLANEOUS PROVISIONS

21.1 Alternative Dispute Resolution.

A.   General:

If the ISO is aggrieved by a vote of the Participants Committee to  approve,
modify or reject a proposed action under this Agreement,  including the Tariff,
it may submit the matter for resolution  hereunder.  If the Participants
Committee is aggrieved by an action  of the ISO Board of Directors ("ISO
Board") under this Agreement,  including the Tariff or the ISO Agreement (as
defined in Section  20(a)), the Participants Committee may submit the matter
for  resolution hereunder; provided, however, that if the action of the  ISO
relates to rulemaking, the Participants Committee may submit  the matters for
resolution under this Section 21.1 only with the  concurrence of the ISO.  Any
Participant which is aggrieved by a  vote of the Participants Committee to
approve, modify or reject a  proposed action under this Agreement, including
the Tariff, may, as  provided below, submit the matter for resolution hereunder
if the  vote:

(1)  requires such Participant to make a payment or to take any  action
pursuant to this Agreement; or

(2)  reduces the amount of any receipt or forbids, pursuant to this  Agreement,
the taking of any action by the Participant; or

(3)  fails to afford it any right to which it is entitled under the  provisions
of this Agreement or imposes on it a burden to  which it is not subject under
the provisions of this  Agreement; or

(4)  results in the termination of the Participant's status as a  Participant
or imposes any penalty on the Participant; or

(5)  results in an allocation of transmission or other facilities  support
obligations; or

(6)  fails to grant in full an application for transmission service  pursuant
to the Tariff.

No legal or regulatory proceeding (except those reasonably  necessary to toll
statutes of limitations, claims for laches or  other bars to later legal or
regulatory action) shall be initiated  by any Participant with respect to any
such matter while  proceedings are pending under this Section with respect to
the  matter.

B.   Procedure:

(1)  Submission of a Dispute: The ISO or a Participant seeking  review of a
vote of the Participants Committee shall give  written notice to the Secretary
of the Participants Committee  within ten business days of the vote, and shall
mail or  telecopy a copy of its notice to each member of the  Participants
Committee.  Where the Participants Committee is  seeking review of an action of
the ISO Board, the Participants  Committee shall give written notice to the
Secretary of the  ISO Board.  The provider of notice under this Section shall
be  referred to herein as the "Aggrieved Party."

(2)  Suspension of Action: If the ISO seeks review of a vote of the
Participants Committee pursuant to this Section, the vote to  be reviewed shall
be suspended pending resolution of such  review by the arbitrator or the
Commission if raised in  regulatory proceedings. If a Participant seeks such a
review,  the vote to be reviewed shall be suspended for up to 90 days
following the giving of the Participant's notice pending  resolution of any
arbitration proceeding unless the  Participants Committee determines that the
suspension will  imperil the stability or reliability of the NEPOOL Control
Area bulk power supply.

(3)  Aggrieved Party Options: (i) If the notice is to seek review  of a vote of
the Participants Committee, the Aggrieved Party's  notice to the Participants
Committee shall invoke arbitration  as described herein in its notice pursuant
to paragraph B(1),  and may also initiate mediation with the agreement of the
Participants Committee, while reserving such Party's right to  proceed with the
arbitration if mediation does not resolve the  matter within 20 days of the
giving of the Party's notice or  such longer period as may be fixed by mutual
agreement of the  Participants Committee and the Aggrieved Party.
Notwithstanding the initiation of mediation, the arbitration  proceeding shall
proceed concurrently with the selection of  the arbitrator pursuant to
paragraph C(1) of this Section  21.1.

(ii) If the notice is to seek review of an ISO action, the  Participants
Committee's notice to the ISO Board shall  (subject to the concurrence of the
ISO for actions relating to  rulemaking as provided in Section 21.1A) invoke
arbitration as  described herein in its notice pursuant to paragraph B(1), and
may also initiate mediation with the agreement of the ISO  Board, while
reserving the Participants Committee's right to  proceed with the arbitration
if mediation does not resolve the  matter within 20 days of the giving of the
Participants  Committee's notice or such longer period as may be fixed by
mutual agreement of the ISO Board and the Participants  Committee.
Notwithstanding the initiation of mediation, the  arbitration proceeding shall
proceed concurrently with the  selection of the arbitrator pursuant to
paragraph C(1) of this  Section 21.1.

(4)  Mediation Positions not to be Used Elsewhere:  All mediation  proceedings
pursuant to this Section are confidential and  shall be treated as compromise
and settlement negotiations for  purposes of applicable rules of evidence.

(5)  Time Limits; Duration:  Any other Participant that wishes to  participate
in an arbitration proceeding hereunder shall give  signed written notice to the
Secretary of the Participants  Committee, and to the Secretary of the ISO Board
if the ISO is  involved in such arbitration, no later than ten calendar days
after the giving of the notice of arbitration. The arbitration  procedure shall
not exceed 90 calendar days from the date of  the Aggrieved Party's notice
invoking arbitration to the  arbitrator's decision unless the parties agree
upon a longer  or shorter time.  All agreements by the ISO or the aggrieved
Participant and the Participants Committee to use mediation  shall establish a
schedule which will control unless later  changed by mutual agreement.

C.   Arbitration:

(1)  Selection of Arbitrator:  The ISO or the aggrieved  Participant and the
Participants Committee shall attempt  to choose by mutual agreement a single
neutral arbitrator  to hear the dispute.  If the ISO or the Participant and
the Participants Committee fail to agree upon a single  arbitrator within ten
calendar days of the giving of  notice of arbitration to the Secretary of the
Participants Committee or the Secretary of the ISO Board,  as the case may be,
the American Arbitration Association  shall be asked to appoint an arbitrator.
In either case,  the arbitrator shall be knowledgeable in matters  involving
the electric power industry, including the  operation of control areas and bulk
power systems, and  shall not have any substantial business or financial
relationships with the ISO, NEPOOL or its Participants  (other than previous
experience as an arbitrator) unless  otherwise mutually agreed by the ISO or
the aggrieved  Participant and the Participants Committee.

(2)  Costs: NEPOOL shall be responsible for all of the costs  of the proceeding
if it is initiated by the ISO or by the  Participants Committee.  If a
proceeding is initiated by  an aggrieved Participant, each party shall be
responsible  for the following costs, if applicable:

(i)  its own costs incurred during the arbitration  process (except that this
does not preclude billing  the aggrieved Participant for its share of NEPOOL
Expenses that may include the Participants  Committee's arbitration costs);
plus

(ii) One half of the common costs of the arbitration  including, but not
limited to, the arbitrator's fee  and expenses, the rental charge for a hearing
room  and the cost of a court reporter and transcript, if  required.

(3)  Hearing Location:  Unless otherwise mutually agreed, the  site for all
arbitration hearings shall be NEPOOL  counsel's office.

D.   Rules and Procedures:

(1)  Procedure and Discovery:  The procedural rules (if any),  the conduct of
the arbitration and the availability,  extent and duration of pre-hearing
discovery (if any),  which shall be limited to the minimum necessary to
resolve the matters in dispute, shall be determined by  the arbitrator in
his/her sole discretion at or prior to  the initial hearing.

(2)  Pre-hearing Submissions:  The Aggrieved Party shall  provide the
arbitrator with a brief written statement of  its complaint and a statement of
the remedy or remedies  it seeks, accompanied by copies of any documents or
other  materials it wishes the arbitrator to review.  The  Participants
Committee will provide the arbitrator with a  copy of this Agreement and all
relevant implementing  documents, a brief description of the action being
arbitrated, copies of the minutes of all NEPOOL committee  meetings at which
the matter was discussed, a brief  statement explaining why the Participants
Committee  believes its decision should be upheld by the arbitrator,  and
copies of any documents or other materials the  Participants Committee wishes
the arbitrator to review.   If the Participants Committee is the Aggrieved
Party, the  ISO Board will provide copies of minutes of the ISO Board  meetings
at which the matter was discussed, a brief  statement explaining why the ISO
Board believes its  decision should be upheld by the arbitrator, and copies  of
any documents or other materials the ISO Board wishes  the arbitrator to
review. These submissions shall be made  within five days after the selection
of the arbitrator.

In addition, each party shall designate one or more  individuals to be
available to answer questions the  arbitrator may have on the documents or
other materials  submitted by that party.  The answers to all such  questions
shall be reduced to writing by the party  providing the answer and a copy shall
be furnished to the  other party.

(3)  Initial Hearing:  An initial hearing will be held no  later than 10 days
after the selection of the arbitrator  and shall be limited to issues raised in
the pre-hearing  filings.  The scheduling of further hearings at the  request
of either party or on the arbitrator's own motion  shall be within the sole
discretion of the arbitrator.

(4)  Decision:  The arbitrator's decision shall be due, unless  the deadline is
extended by mutual agreement of the ISO  or the aggrieved Participant and the
Participants  Committee, within sixty days of the initial hearing or  within
ninety days of the Aggrieved Party's initiation of  arbitration, whichever
occurs first.  The arbitrator  shall be authorized only to interpret and apply
the  provisions of this Agreement and the arbitrator shall  have no power to
modify or change the Agreement in any  manner.

(5)  Effect of Arbitration Decision:  The decision of the  arbitrator will be
conclusive in a subsequent regulatory  or legal proceeding as to the facts
determined by the  arbitrator but will not be conclusive as to the law or
constitute precedent on issues of law in any subsequent  regulatory or legal
proceedings.  An aggrieved party may initiate a proceeding with a court or
with the Commission with respect to the arbitration or  arbitrator's decision
only:

     if the arbitration process does not result in a  decision within the time
period specified and the  proceeding is initiated within thirty days after the
expiration of such time period; or

     on the grounds specified in Sections 10 and 11 of  Title 9 of the United
States Code for judicial  vacation or modification of an arbitration award and
the proceeding is initiated within thirty days of  the issuance of the
arbitrator's decision.

(6)  Other Disputes:  In the event a dispute arises with a  Non-Participant
which receives or is eligible to receive  service under this Agreement or the
Tariff with respect  to such service, the Non-Participant shall have the right
to have the dispute considered by the Participants  Committee.  In the event
the Non-Participant is aggrieved  by the Participants Committee's vote on the
dispute, and  the vote has any of the effects specified in paragraph A  of this
Section 21.1, the aggrieved Non-Participant may  require that the dispute be
resolved in accordance with  this Section 21.1.  To the extent that NEPOOL
provides  services to Non-Participants under separate agreements,  the
Participants Committee shall incorporate the  provisions of this Section by
reference in any such  agreement, in which case the term "Participant" shall be
deemed for purposes of the dispute resolution provisions  to include such
Non-Participant purchasers of NEPOOL  services.

21.2 Payment of Pool Charges; Termination of Status as Participant.

(a)  Any Participant shall have the right to terminate its status as a
Participant upon no less than six months' prior written notice  given to the
Secretary of the Participants Committee.

(b)  If at any time during the term of this Agreement a receiver or  trustee of
a Participant is appointed or a Participant is  adjudicated bankrupt or an
order for relief is entered under the  Federal Bankruptcy Code against a
Participant or if there shall be  filed against any Participant in any court
(pursuant to the Federal  Bankruptcy Code or any statute of Canada or any state
or province)  a petition in bankruptcy or insolvency or for reorganization or
for  appointment of a receiver or trustee of all or a portion of the
Participant's property, and within ninety days after the filing of  such a
petition against the Participant, the Participant shall fail  to secure a
discharge thereof, or if any Participant shall file a  petition in voluntary
bankruptcy or seeking relief under any  provision of any bankruptcy or
insolvency law or shall make an  assignment for the benefit of creditors, the
Participants Committee  may terminate such Participant's status as a
Participant as of any  time thereafter.

(c)  Each Participant is obligated to pay when due in accordance with  NEPOOL
procedures all amounts invoiced to it by NEPOOL, or by the  ISO on behalf of
NEPOOL.  If a Participant disputes a NEPOOL  invoice in whole or part, it shall
be entitled to continue to  receive service under the Agreement and the Tariff,
so long as the  Participant (i) continues to make all payments not in dispute,
and  (ii) pays into an independent escrow account the portion of the  invoice
in dispute, pending resolution of the dispute.  If the  Participant fails to
meet these two requirements for continuation  of service, NEPOOL may suspend
service, in whole or part, to the  Participant sixty days after the giving of
notice to the  Participant of NEPOOL's intention to suspend service, in
accordance  with Commission policy.

(d)  In the event a Participant fails, for any reason other than a  billing
dispute as described in subsection (c) of this Section  21.2, to pay when due
in accordance with NEPOOL procedures all  amounts invoiced to it by NEPOOL, or
by the ISO on behalf of  NEPOOL, or the Participant fails to perform any other
obligation  under the Agreement or the Tariff, and such failure continues for
at least ten days, NEPOOL may notify the Participant that it is in  default and
may initiate a proceeding before the Commission to  terminate such
Participant's status as a Participant.  Pending  Commission action on such
termination, NEPOOL may suspend service,  in whole or part, to the Participant
on or after 50 days after the  giving of such notice and the initiation of such
proceeding, in  accordance with Commission policy, unless the Participant cures
the  default within such 50-day period.

(e)  If the status of a Participant as a Participant is terminated  pursuant to
this Section 21.2 or any other provision of this  Agreement, such former
Participant's generation and transmission  facilities shall continue to be
subject to such NEPOOL or other  requirements relating to reliability as the
Commission may approve  in acting on the termination, for so long as the
Commission may  direct.  Further, if any of such former Participant's
transmission  facilities are required in order to permit transactions among any
of the remaining Participants pursuant to this Agreement or the  Tariff, all
pending requests for transmission service under the  Tariff relating to such
Participant's facilities shall be followed  to completion under the
Participant's own tariff and all existing  service over the Participant's
facilities shall continue to be  provided under the Tariff for a period of
three years.  It is the  intent of this subsection that no such termination
should be  allowed to jeopardize the reliability of the bulk power facilities
of any remaining Participant or should be allowed to impose any  unreasonable
financial burden on any remaining Participant.

(f)  No such termination of a Participant's status as a Participant  shall
affect any obligation of, or to, such former Participant  incurred prior to the
effective time of such termination.

21.3 Assignment.  The Agreement shall inure to the benefit of, and shall be
binding upon, the successors and assigns of the respective signatories  hereto,
but no assignment of a signatory's interests or obligations  under the
Agreement or any portion thereof shall be made without the  written consent of
the Participants Committee, except as otherwise  permitted by the Tariff, or
except in connection with a sale, merger, or  consolidation which results in
the transfer of all or a portion of a  signatory's generation or transmission
assets to, and the assumption of  all of the obligations of the signatory under
this Agreement (or in the  case of a transfer of a portion of a signatory's
generation or  transmission assets, the assumption of obligations of the
signatory  under this Agreement with respect to such assets) by, an acquiring
or  surviving Entity which either is, or concurrently becomes, a  Participant,
or agrees to assume such of the signatory's obligations  with respect to such
assets as the Participants Committee may reasonably  require, or except in
connection with the grant of a security interest  in a Participant's assets as
security for bonds or other financing.

21.4 Force Majeure.  A Participant shall not be considered to be in default  in
respect of any obligation hereunder if prevented from fulfilling such
obligation by an event of Force Majeure.  An event of Force Majeure  means any
act of God, labor disturbance, act of the public enemy, war,  insurrection,
riot, fire, storm or flood, explosion, breakage or  accident to machinery or
equipment, any Curtailment, any order,  regulation or restriction imposed by a
court or governmental military or  lawfully established civilian authorities,
or any other cause beyond a  Participant's control, provided that no event of
Force Majeure affecting  any Participant shall excuse that Participant from
making any payment  that it is obligated to make under this Agreement.  A
Participant whose  performance under this Agreement is hindered by an event of
Force  Majeure shall make all reasonable efforts to perform its obligations
under this Agreement, and shall promptly notify the Participants  Committee of
the commencement and end of any event of Force Majeure.

21.5 Waiver of Defaults.  No waiver of the performance by a Participant of  any
obligation under this Agreement or with respect to any default or  any other
matter arising in connection with this Agreement shall be  effective unless
given by the Participants Committee.  Any such waiver  by the Participants
Committee in any particular instance shall not be  deemed a waiver with respect
to any subsequent performance, default or  matter.

21.6 Other Contracts.  No Participant shall be a party to any other agreement
which in any manner is inconsistent with its obligations under this  Agreement.


21.7 Liability and Insurance.

(a)  Each Participant will indemnify and save each of the other  Participants,
its officers, directors and Related Persons (each an  "Indemnified Party")
harmless from and against all actions, claims,  demands, costs, damages and
liabilities asserted by a third party  against the Indemnified Party seeking
indemnification and arising  out of or relating to bodily injury, death or
damage to property  caused by or sustained on facilities owned or controlled by
such  Participant that are the subject of this Agreement, or caused by a
failure to act in accordance with this Agreement by the Participant  from which
indemnification is sought, except (i) to the extent that  such liabilities
result from the negligence or willful misconduct  of the Participant seeking
indemnification, and (ii) each  Participant shall be responsible for all claims
of its own  employees, agents and servants growing out of any workmen's
compensation law.  The amount of any indemnity payment under the  provisions of
this Section 21.7 shall be reduced (including,  without limitation,
retroactively) by any insurance proceeds or  other amounts actually recovered
by the Indemnified Party in  respect of the indemnified action, claim, demand,
cost, damage or  liability.  Notwithstanding the foregoing, no Participant
shall be  liable to any Indemnified Party for any claim for loss of profits  or
revenues, attorneys' fees or costs, cost of capital or  financing, loss of
goodwill or cost of replacement power arising  from a Participant's carrying
out, or failing to carry out, any  obligations contemplated by this Agreement
or for any other  indirect, incidental, special, consequential, punitive, or
multiple  damages or loss; provided, however, that nothing herein shall  reduce
or limit the obligations of any Participant to Non- Participants.

(b)  Each Participant shall furnish, at its sole expense, such insurance
coverage as the Participants Committee may reasonably require with  respect to
its obligation pursuant to Section 21.7(a).

21.8 Records and Information.  Each Participant shall keep such records as  may
reasonably be required by a NEPOOL committee or the System Operator,  and shall
furnish to such committee or the System Operator such records,  reports and
information (including forecasts) as it may reasonably  require, provided the
confidentiality thereof is protected in accordance  with NEPOOL's information
policy.

21.9 Consistency with NPCC and NERC Standards.  The standards, criteria and
rules adopted by NEPOOL committees under this Agreement shall be  consistent
with those adopted by the NPCC and NERC or any successor to  either.

21.10     Construction.

(a)  The Table of Contents contained in this Agreement and the headings  of the
Sections of this Agreement are intended for convenience only  and shall not be
deemed to be part of this Agreement or considered  in construing it.

(b)  This Agreement shall be interpreted, construed and governed in  accordance
with the laws of the State of Connecticut.

21.11     Amendment.  Subject to Section 17A and the provisions of this
Section, this Agreement, including the Tariff, and any attachment or  exhibit
hereto may be amended from time to time by vote of the  Participants in
accordance with Section 6.11.

Any amendment to this Agreement approved in accordance with Section 6.11
and/or Section 17A shall be in writing and shall become effective, and  shall
bind all Participants regardless of whether they have executed a  ballot in
favor of such amendment, on the date specified in the  amendment, subject to
acceptance or approval by the Commission.  Nothing  herein shall be construed
to prevent any Participant from challenging  any proposed amendment before a
court or regulatory agency on the ground  that the proposed amendment or its
application to the Participant is in  violation of law or of this Agreement.

21.12     Termination.  This Agreement shall continue in effect until
terminated, in accordance with the Commission's regulations, by  Participants
represented by members of the Participants Committee having  Member Fixed
Voting Shares equal to at least 70% of the Member Fixed  Voting Shares of all
Participants. No such termination shall relieve any  party of any obligation
arising prior to the effective time of such  termination.

21.13     Notices to Participants, Committees, Committee Members, or the
System Operator.

(a)  Any notice, demand, request or other communication required or  authorized
by this Agreement to be given to any Participant shall  be in writing, and
shall be (1) personally delivered to the  Participants Committee member or
alternate representing that  Participant; (2) mailed, postage prepaid, to the
Participant at the  address of its member on the Participants Committee as set
out in  the NEPOOL roster; (3) sent by facsimile ("faxed") to the  Participant
at the fax number of its member on the Participants  Committee as set out in
the NEPOOL roster; or (4) delivered  electronically to the Participant at the
electronic mail address of  its member on the Participants Committee or at the
address of its  principal office.  The designation of any such address may be
changed at any time by written notice delivered to the Secretary of  the
Participants Committee, who shall cause such change to be  reflected in the
NEPOOL roster.

(b)  Any notice, demand, request or other communication required or  authorized
by this Agreement to be given to any NEPOOL committee  shall be in writing and
shall be delivered to the Secretary of the  committee.  Each such notice shall
either be personally delivered  to the Secretary, mailed, postage prepaid, or
sent by facsimile  ("faxed") to the Secretary at the address or fax number set
out in  the NEPOOL roster, or delivered electronically to the Secretary.  The
designation of such address may be changed at any time by  written notice
delivered to each Participant.

(c)  Any notice, demand, request or other communication required or  authorized
by this Agreement to be given to a member or alternate  to that member of a
Principal Committee (for the purposes of this  Section 21.13, individually or
collectively, the "Committee  Member") shall be (1) personally delivered to the
Committee Member;  (2) mailed, postage prepaid, to the Committee Member at the
address  of the Committee Member set out in the NEPOOL roster; (3) sent by
facsimile ("faxed") to the Committee Member at the fax number of  the Committee
Member set out in the NEPOOL roster; or (4) delivered  electronically to the
Committee Member at the electronic mail  address of the Committee Member set
out in the NEPOOL roster.  The  designation of any such address may be changed
at any time by  written notice delivered to the Secretary of the Principal
Committee on which the Committee Member serves, who shall cause  such change to
be reflected in the NEPOOL roster.

(d)  Any notice, demand, request or other communication required or  authorized
by this Agreement to be given to the System Operator  shall be in writing, and
shall be (1) personally delivered to the  Participants Committee member or
alternate appointed by the System  Operator; (2) mailed, postage prepaid, to
the System Operator at  the address of its member on the Participants Committee
as set out  in the NEPOOL roster; (3) sent by facsimile ("faxed") to the System
Operator at the fax number of its member on the Participants  Committee as set
out in the NEPOOL roster; or (4) delivered  electronically to the System
Operator at the electronic mail  address of its member on the Participants
Committee or at the  address of its principal office.  The designation of any
such  address may be changed at any time by written notice delivered to  the
Secretary of the Participants Committee, who shall cause such  change to be
reflected in the NEPOOL roster.

(e)  To the extent that the Participants Committee is required to serve  upon
any Participant a copy of any document or correspondence filed  with the
Commission under the Federal Power Act or the Commission's  rules and
regulations thereunder, by or on behalf of any Principal  Committee, such
service may be accomplished by electronic delivery  to the Participant at the
electronic mail address of its  Participants Committee member and alternate.
The designation of  any such address may be changed at any time by written
notice  delivered to the Secretary of the Participants Committee.

(f)  Any such notice, demand or request so addressed and mailed by  registered
or certified mail shall be deemed to be given when so  mailed.  Any such
notice, demand, request or other communication  sent by regular mail or by
facsimile ("faxed") or delivered  electronically shall be deemed given when
received by the  Participant, Committee Member, System Operator, or Secretary
of the  NEPOOL committee, whichever is applicable.

21.14     Severability and Renegotiation.  If any provision of this Agreement
is held by a court or regulatory authority of competent jurisdiction to  be
invalid, void or unenforceable, the remainder of the terms,  provisions,
covenants and restrictions of this Agreement shall continue  in full force and
effect and shall in no way be affected, impaired or  invalidated, except as
otherwise explicitly provided in this Section.

If any provision of this Agreement is held by a court or regulatory  authority
of competent jurisdiction to be invalid, void or  unenforceable, or if the
Agreement is modified or conditioned by a  regulatory authority exercising
jurisdiction over this Agreement, the  Participants shall endeavor in good
faith to negotiate such amendment or  amendments to this Agreement as will
restore the relative benefits and  obligations of the Participants under this
Agreement immediately prior  to such holding, modification or condition.  If
after sixty days such  negotiations are unsuccessful the Participants may
exercise their  withdrawal or termination rights under this Agreement.

21.15     No Third-Party Beneficiaries.  Except for the provisions of this
Agreement and the Tariff which provide for service to Non-Participants,  this
Agreement is intended to be solely for the benefit of the  Participants and
their respective successors and permitted assigns and,  unless expressly stated
herein, is not intended to and shall not confer  any rights or benefits on any
third party (other than successors and  permitted assigns) not a signatory
hereto.

21.16     Counterparts.  This Agreement may be executed in any number of
counterparts, and each executed counterpart shall have the same force  and
effect as an original instrument and as if all the parties to all of  the
counterparts had signed the same instrument.  Any signature page of  this
Agreement may be detached from any counterpart of this Agreement  without
impairing the legal effect of any signatures thereon, and may be  attached to
another counterpart of this Agreement identical in form  hereto but having
attached to it one or more signature pages.

IN WITNESS WHEREOF, the signatories have caused this Agreement to be  executed
by their duly authorized officers or representatives.

ATTACHMENT A
TO RESTATED
NEPOOL AGREEMENT

METHODOLOGY FOR DETERMINATION OF TRANSMISSION FLOWS

The methodology for determining parallel path transmission flows to be  used in
determining the distribution of revenues received for Regional  Network Service
provided during the Transition Period, or for Through or Out  Service, is as
follows, and shall be determined (1) on the basis of the flows  for all
transactions in the NEPOOL Control Area ("Regional Flows") for the  purpose of
allocating during the Transition Period Regional Network Service  revenues, and
(2) on the basis of the flows for the particular transaction  ("Transaction
Flows") for the purpose of allocating revenues during or after  the Transition
Period from the furnishing of Through or Out Service:

A.   Responsibility for Calculations

The calculation of megawatt mile allocations in accordance with this
methodology shall be performed under the direction of the Reliability
Committee.

B.   Periodic Review

Calculations of MW-Mile allocations shall be performed whenever  significant
changes to the transmission system load flows, as determined by  the
Reliability Committee, occur.

C.   Facilities Included in the Analysis

1.   Transmission Lines

A calculation of MW-miles shall be determined for all PTF  lines.

2.   Generators

The analysis shall include all generators with a Winter  Capability equal to or
greater than 10.0 MW.  Multiple  generators connected to a single bus with a
total Winter  Capability equal to or greater than 10.0 MW shall also be
included.

3.   Transformers

All transformers connecting PTF transmission lines shall be  included in the
analysis.

D.   Determination of Rate Distribution

1.   General

Modeling of the transmission system shall be performed using a  system
simulation program and associated cases as approved by  the Reliability
Committee.

2.   Determination of Regional Flows

The change in real power flow (MW) over each transmission line  and transformer
shall be determined for each generator (or  group of generators on a single
bus) by determining the  absolute value of the difference between the flows on
each  facility with the generator(s) modeled off and while operating  at its
net Winter Capability.  In addition, a generator shall  be simulated at each
transmission line tie to the NEPOOL  Control Area and changes in flow
determined for this generator  off or while generating at a level of 100 MW.
Loads  throughout the NEPOOL Control Area shall be proportionally  scaled to
account for differences in generator output and  electrical losses.  The
changes in flow shall be multiplied by  the length of each respective line.
Changes in flow through  transformers shall be multiplied by a factor of five.
Changes  in flow through phase-shifting transformers shall be  multiplied by a
factor of ten.  The resulting values represent  the MW-miles associated with
each facility.

3.   Determination of Transaction Flows

a.   Definition of Supply and Receipt Areas

For the purposes of these calculations, areas of supply  and receipt shall be
determined by the Reliability  Committee.  These areas shall be based on the
system  boundaries of each Local Network.

b.   Calculation of MW-Miles  The change in real power flow (MW) over each
transmission  line and transformer shall be determined for each  combination of
supply and receipt areas by determining  the absolute value of the difference
between the flows on  each facility following a scaled increase of the
supplying areas generation by 100 MW.  Loads in the area  of receipt shall be
scaled to account for changes in  generation and electrical losses.  In
instances where the  areas of supply and/or receipt are outside the NEPOOL
Control Area, the changes in real power flow will be  determined only for
facilities within the NEPOOL Control  Area.  The changes in flow shall then be
multiplied by  the length of each respective line.  Changes in flow  through
transformers shall be multiplied by a factor of  five.  Changes in flow through
phase-shifting  transformers shall be multiplied by a factor of ten.  The
resulting values represent the MW-miles associated with  each facility.

4.   Assignment of MW-Miles to Participants

Each Participant shall have assigned to it the MW-miles  associated with each
PTF facility for which it has full  ownership and for which there are no
arrangements in effect by  which other Participants support the facility.   For
facilities that are jointly owned and/or supported, each  Participant shall be
assigned MW-miles in proportion to the  percentage of its ownership of
jointly-owned facilities and/or  the percentage of its support for facilities
that are jointly  supported to the extent such support payments are included in
the determination of Annual Transmission Revenue Requirements.