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                                                                   Exhibit 10.63



                            INTERCONNECTION AGREEMENT


                                     BETWEEN


                        NIAGARA MOHAWK POWER CORPORATION

                                       AND

                                HUNTLEY POWER LLC



                                                            Date: April 14, 1999


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       This INTERCONNECTION AGREEMENT (hereinafter referred to as the
"AGREEMENT") is made as of ___________ 1999, between NIAGARA MOHAWK POWER
CORPORATION (hereinafter referred to as "NIAGARA MOHAWK") and HUNTLEY POWER LLC,
(hereinafter referred to as the "PRODUCER").

       WHEREAS, PRODUCER'S ability to deliver and sell ELECTRICITY to NIAGARA
MOHAWK and/or other purchasers from the PRODUCTION FACILITY is contingent on the
PRODUCTION FACILITY remaining interconnected to the TRANSMISSION SYSTEM through
the INTERCONNECTION FACILITY.

       NOW THEREFORE, in consideration of the mutual obligations and
undertakings set forth herein, the parties to this AGREEMENT covenant and agree
as follows:


                                   ARTICLE I
                                  DEFINITIONS

The terms listed below shall have the following meanings when used in this
INTERCONNECTION AGREEMENT.

1.1    This AGREEMENT shall become effective as of the date first above written
       (the "EFFECTIVE DATE").

1.2    "INTERCONNECTION POINT" is the point at which the PRODUCTION FACILITY is
       connected to the INTERCONNECTION FACILITY as indicated on a one-line
       diagram included as part of Exhibit A.

1.3    "DELIVERY POINT" is the point at which the INTERCONNECTION FACILITY is
       connected to the TRANSMISSION SYSTEM as indicated on a one-line diagram
       included as part of Exhibit A.

1.4    "ELECTRICITY" shall mean electric capacity and/or energy produced by the
       PRODUCTION FACILITY.

1.5    "FERC" shall mean the Federal Energy Regulatory Commission or successor
       organization.


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1.6    "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 judgment in light
       of the facts known at the time the decision was made, could have been
       expected to accomplish the desired result at the lowest reasonable cost
       consistent with good business practices, reliability, safety and
       expedition. Good Utility Practice is not intended to be limited to the
       optimum practice, method, or act, to the exclusion of all others, but
       rather to be acceptable practices, methods, or acts generally accepted in
       the region and consistently adhered to by NIAGARA MOHAWK. GOOD UTILITY
       PRACTICE shall include, but not be limited to North American Electric
       Reliability Council ("NERC") Criteria & Guidelines, Northeast Power
       Coordinating Council ("NPCC") Criteria & Guidelines, New York State
       Reliability Council ("NYSRC") if any, and New York Power Pool ("NYPP")
       criteria, rules and standards, as they may be amended from time to time
       including the rules, guidelines and criteria of any successor
       organization to the foregoing entities.

1.7    "HAZARDOUS SUBSTANCE(S)" shall mean those substances, materials, products
       or wastes which are classified as hazardous or toxic under any applicable
       federal, state or local law, or any regulations promulgated thereunder,
       effective the date of execution of this AGREEMENT, and the presence of
       which requires redemption, removal or cleanup under this AGREEMENT.

1.8    "INTERCONNECTION FACILITY" shall include all those facilities and NIAGARA
       MOHAWK PROPERTIES on which such facilities are located between the
       INTERCONNECTION POINT and the DELIVERY POINT, necessary to effect the
       transfer of ELECTRICITY, produced at the PRODUCTION FACILITY into NIAGARA
       MOHAWK'S TRANSMISSION SYSTEM, including those facilities identified in
       more particularity in Exhibit A to this AGREEMENT.

1.9    "NIAGARA MOHAWK PROPERTIES" shall mean those parcels of real property
       and/or easements that NIAGARA MOHAWK uses for its transmission facilities
       upon which portions of the INTERCONNECTION FACILITY have been constructed
       and which property PRODUCER exclusively uses under this AGREEMENT, which
       parcels of real property and/or easements and facilities are described in
       more particularity in Exhibit A hereto.


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1.10   "PRODUCTION FACILITY" shall mean PRODUCER'S Huntley generating facility
       with a maximum output of 760 MW located in the Town of Tonawanda, County
       of Erie, New York.

1.11   "TRANSMISSION SYSTEM" shall mean NIAGARA MOHAWK'S TRANSMISSION SYSTEM,
       including any modifications subsequent to the date of this AGREEMENT.

1.12   "ELECTRIC SYSTEM BULLETIN No. 756" shall mean NIAGARA MOHAWK'S Electric
       System Bulletin 756, dated December, 1997, and all subsequent revisions,
       as it may be amended from time to time.

1.13   "INDEPENDENT SYSTEM OPERATOR" ("ISO") shall mean an organization formed
       in accordance with FERC order (s) to administer the operation of the
       transmission system, provide equal access to the transmission system of
       New York State, and to maintain system reliability.

1.14   "ISLANDING" shall mean the separation of PRODUCER'S generation from
       NIAGARA MOHAWK'S electric system while continuing to serve NIAGARA
       MOHAWK'S isolated load.

1.15   "INTERCONNECTION STUDIES" shall mean the necessary studies, identified in
       Paragraph 8.2.2, in the event it becomes necessary to modify the
       INTERCONNECTION FACILITY or to construct new or additional facilities,
       NIAGARA MOHAWK shall perform those studies that, in the judgement of
       NIAGARA MOHAWK, are necessary to determine (a) an appropriate
       INTERCONNECTION POINT (b) the equipment and facilities necessary and
       desirable for the construction and operation of new or additional or
       modified facilities (c) the interconnection voltage (d) the estimated
       costs of facilities and/or the costs for NIAGARA MOHAWK'S design, review,
       assistance and inspection of facilities to be designed and constructed by
       PRODUCER (e) the costs of any new reinforcements to or additions of new
       facilities to NIAGARA MOHAWK'S TRANSMISSION SYSTEM required or
       recommended to be made in order for NIAGARA MOHAWK to interconnect with
       PRODUCER'S PRODUCTION FACILITY.

1.16   "SERVICE POINT' is the point at which the PRODUCTION FACILITY is
       connected to the TRANSMISSION SYSTEM for retail delivery of ELEC-


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TRICITY by NIAGARA MOHAWK to the PRODUCTION FACILITY as indicated on a one-line
diagram included as part of Exhibit A.



                                   ARTICLE II
                           AGREEMENT TO INTERCONNECT
                    DESCRIPTION OF INTERCONNECTION FACILITY

2.1    NIAGARA MOHAWK and PRODUCER agree to remain interconnected in accordance
       with the terms agreed to herein.

2.2    NIAGARA MOHAWK and PRODUCER shall be interconnected by means of the
       INTERCONNECTION FACILITY, which NIAGARA MOHAWK shall operate, own and
       maintain, at the PRODUCER's expense.

2.3    The PRODUCTION FAC1LITY shall include all facilities and equipment on the
       PRODUCER's side of the INTERCONNECTION POINT as indicated on Exhibit A.
       PRODUCER agrees that the installation of the electrical equipment and the
       operation of the PRODUCTION FACILITY must meet or exceed the requirements
       of NIAGARA MOHAWK'S ELECTRIC SYSTEM BULLETIN No. 756. Notwithstanding the
       foregoing, NIAGARA MOHAWK acknowledges and agrees to the following
       limitations for the existing PRODUCTION FACILITY as it pertains to
       NIAGARA MOHAWK'S ELECTRIC SYSTEM BULLETIN No. 756:

       2.3.1  If at the date of this AGREEMENT the PRODUCTION FACILITY does not
              conform to NIAGARA MOHAWK'S ELECTRIC SYSTEM BULLETIN No. 756, but
              was built in accordance with GOOD UTILITY PRACTICE and does not
              present any adverse impact on NIAGARA MOHAWK'S TRANSMISSION SYSTEM
              as determined by NIAGARA MOHAWK in its reasonable discretion, then
              it is not the intent of this AGREEMENT to cause the PRODUCER'S
              PRODUCTION FACILITY to immediately upgrade to full compliance with
              ELECTRIC SYSTEM BULLETIN No. 756. Any upgrades required to protect
              NIAGARA MOHAWK'S TRANSMISSION SYSTEM from adverse impacts will be
              listed in Exhibit B and must be completed within ninety (90) days
              of signing this AGREEMENT unless otherwise mutually agreed upon by
              both parties.


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       2.3.2  The parties agree that it is the intent of this AGREEMENT to
              require the PRODUCER'S PRODUCTION FACILITY to conform to ELECTRIC
              SYSTEM BULLETIN No. 756 and therefore, agree that as additions,
              modifications and replacements to PRODUCER'S PRODUCTION FACILITY
              are implemented, the additions, modifications and replacements
              will conform to ELECTRIC SYSTEM BULLETIN No. 756. If the PRODUCER
              upgrades the system protection or upgrades technology employed at
              the PRODUCTION FACILITY (for example, but not limited to,
              repowering), if in NIAGARA MOHAWK'S reasonable discretion, it is
              necessary for safety, such portion of the PRODUCER'S PRODUCTION
              FACILITY, as is necessary, will be brought into full compliance
              with the requirements of ELECTRIC SYSTEM BULLETIN No. 756, at that
              time.

       2.3.3  If PRODUCER relies on NIAGARA MOHAWK'S system protection equipment
              and practices for protection of PRODUCTION FACILITY equipment,
              PRODUCER agrees to indemnify, defend, and save NIAGARA MOHAWK, its
              agents and employees, harmless from, and against any loss, damage,
              liability (civil or criminal), cost, suit, charge, expense
              (including reasonable attorneys fees) or cause of action, arising
              from any damage to the PRODUCTION FACILITY resulting from such
              reliance, except if such loss, damage, liability, cost, suit,
              charge, expense or cause of action is the result of NIAGARA
              MOHAWK's willful misconduct or gross negligence.

       2.3.4  NIAGARA MOHAWK reserves the right to operate the first means of
              disconnect on the PRODUCER'S side of the INTERCONNECTION POINT in
              accordance with GOOD UTILITY PRACTICE. PRODUCER reserves the right
              to operate the circuit breakers on NIAGARA MOHAWK'S side of the
              INTERCONNECTION POINT for synchronization and disconnection of
              Generators 63, 64, 65 and 66 in accordance with GOOD UTILITY
              PRACTICE.

       2.3.5  Upon implementation of an ISO and at NIAGARA MOHAWK'S sole
              discretion, the requirements, rules and regulations of the ISO may
              govern requirements of ELECTRIC SYSTEM BULLETIN No. 756.

2.4    PRODUCER recognizes that neither this AGREEMENT nor the PRODUCER'S
       financial support of the INTERCONNECTION FACILITIES


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       confers upon it any right to transmit electricity over NIAGARA MOHAWK'S
       TRANSMISSION SYSTEM other than through the INTERCONNECTION FACILITIES.

2.5    NIAGARA MOHAWK shall use due diligence, in accordance with GOOD UTILITY
       PRACTICE, to operate and maintain the INTERCONNECTION FACILITIES and to
       have them available for the transmission of electricity. NIAGARA MOHAWK
       shall consult with PRODUCER regarding the timing of scheduled maintenance
       of the INTERCONNECTION FACILITY, which might reasonably be expected to
       affect PRODUCER'S PRODUCTION FACILITY. NIAGARA MOHAWK shall, to the
       extent practicable, schedule any maintenance to coincide with PRODUCER'S
       scheduled outage. NIAGARA MOHAWK does not, however, guarantee or warrant
       uninterrupted availability of the INTERCONNECTION FACILITIES or
       TRANSMISSION SYSTEM. Curtailment of deliveries over the INTERCONNECTION
       FACILITIES or TRANSMISSION SYSTEM shall be governed by the transmission
       agreement or agreements between NIAGARA MOHAWK and the PRODUCER.

2.6    PRODUCER hereby grants NIAGARA MOHAWK all necessary rights of way,
       easements, and licenses as NIAGARA MOHAWK may reasonably require to
       install, operate, maintain, replace and remove NIAGARA MOHAWK'S
       facilities, including adequate and continuing rights of access to
       PRODUCER'S property for any purpose reasonably related to this AGREEMENT.
       PRODUCER hereby agrees to execute such grants, deeds, licenses,
       instruments or other documents as NIAGARA MOHAWK may require to enable it
       to record such rights of way, easements and licenses.

2.7    NIAGARA MOHAWK hereby grants PRODUCER all necessary rights of way,
       easements, and licenses as PRODUCER may reasonably require to install,
       operate, maintain, replace and remove PRODUCER'S facilities, including
       adequate and continuing rights of access to NIAGARA MOHAWK'S property for
       any purpose reasonably related to this AGREEMENT. NIAGARA MOHAWK hereby
       agrees to execute such grants, deeds, licenses, instruments or other
       documents as PRODUCER may require to enable it to record such rights of
       way, easements and licenses.


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                                  ARTICLE III
                   REPRESENTAT1ONS AND WARRANTIES OF PARTIES

3.1    PRODUCER is a limited liability company duly organized and validly
       existing under the laws of the State of Delaware. PRODUCER is qualified
       to do business under the laws of the State of New York, is in good
       standing under the laws of the State of New York, has the power and
       authority to own its properties, to carry on its business as. now being
       conducted, and to enter into this AGREEMENT and the transactions
       contemplated herein and perform and carry out all covenants and
       obligations on its part to be performed under and pursuant to this
       AGREEMENT, and is duly authorized to execute and deliver "this AGREEMENT"
       and consummate the transactions contemplated herein.

3.2    PRODUCER is not prohibited from entering into this AGREEMENT and
       discharging and performing all covenants and obligations on its part to
       be performed under and pursuant to this AGREEMENT. The execution and
       delivery of this AGREEMENT, the consummation of the transactions
       contemplated herein and the fulfillment of and compliance with the
       provisions of this AGREEMENT will not conflict with or constitute a
       breach of or a default under any of the terms, conditions or provisions
       of any law, rule or regulation, any order, judgment, writ, injunction,
       decree, determination, award or other instrument or legal requirement of
       any court or other agency of government, the agreement of limited
       partnership of PRODUCER or any contractual limitation, corporate
       restriction or outstanding trust indenture, deed of trust, mortgage, loan
       agreement, lease, other evidence of indebtedness or any other agreement
       or instrument to which PRODUCER is a party or by which it or any of its
       property is bound and will not result in a breach of or a default under
       any of the foregoing. This AGREEMENT is the legal, valid and binding
       obligation of PRODUCER enforceable in accordance with its terms, except
       as limited by applicable reorganization, insolvency, liquidation,
       readjustment of debt, moratorium, or other similar laws affecting the
       enforcement of rights of creditors generally as such laws may be applied
       in the event of a reorganization, insolvency, liquidation, readjustment
       of debt or other similar proceeding of or moratorium applicable to
       PRODUCER and by general principles of equity (regardless of whether such
       enforceability is considered in a proceeding in equity or at law.)


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3.3    NIAGARA MOHAWK is a corporation duly organized, validly existing and
       qualified to do business under the laws of the State of New York, is in
       good standing under its certificate of incorporation and the laws of the
       State of New York, has the corporate authority to own its properties, to
       carry on its business as now being conducted, and to enter into this
       AGREEMENT and the transactions contemplated herein and perform and carry
       out all covenants and obligations on its part to be performed under and
       pursuant to this AGREEMENT, and is duly authorized to execute and deliver
       this AGREEMENT and consummate the transactions contemplated herein.

3.4    NIAGARA MOHAWK is not prohibited from entering into this AGREEMENT and
       discharging and performing all covenants and obligations on its part to
       be performed under and pursuant to this AGREEMENT pending review and
       acceptance of the terms of this AGREEMENT by the FERC or successor
       organization. The execution and delivery of this AGREEMENT and upon its
       acceptance for filing by the FERC, the consummation of the transactions
       contemplated herein and the fulfillment of and compliance with the
       provisions of this AGREEMENT will not conflict with or constitute a
       breach of or a default under any of the terms, conditions or provisions
       of any law, rule or regulation, any order, judgment, writ, injunction,
       decree, determination, award or other instrument or legal requirement of
       any court or other agency of government, the certificate of incorporation
       or bylaws of NIAGARA MOHAWK or any contractual limitation, corporate
       restriction or outstanding trust indenture, deed of trust, mortgage, loan
       agreement, lease, other evidence of indebtedness or any other agreement
       or instrument to which NIAGARA MOHAWK is a party or by which it or any of
       its property is bound and will not result in a breach of or a default
       under any of the foregoing. This AGREEMENT is the legal, valid and
       binding obligation of NIAGARA MOHAWK upon its acceptance for filing by
       the FERC becomes enforceable in accordance with its terms, except as
       limited by later order of the FERC, applicable reorganization,
       insolvency, liquidation, readjustment of debt, moratorium, or other
       similar laws affecting the enforcement of rights of creditors generally
       as such laws may be applied in the event of a reorganization, insolvency,
       liquidation, readjustment of debt or other similar proceeding of or
       moratorium applicable to PRODUCER and by general principles of equity
       (regardless of whether such enforceability is considered in a proceeding
       in equity or at law).


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                                   ARTICLE IV
                  MODIFICATION TO THE INTERCONNECTION FACILITY

4.1    NIAGARA MOHAWK shall retain the discretion to determine whether, when,
       and in what manner replacements or upgrades to the INTERCONNECT1ON
       FACILITIES shall be installed. NIAGARA MOHAWK shall exercise that
       discretion in accordance with GOOD UTILITY PRACTICE. NIAGARA MOHAWK shall
       use reasonable efforts to schedule and coordinate with PRODUCER to
       minimize disruption of PRODUCERS planned operations of its PRODUCTION
       FACILITY. Any such replacements or upgrades that are installed shall be
       deemed to be INTERCONNECTION FACILITIES for purposes of this AGREEMENT.

4.2    NIAGARA MOHAWK shall notify the PRODUCER if it determines that a
       replacement or upgrade to any portion of the INTERCONNECTION FACILITIES
       is necessary or advisable. The actual cost of designing, permitting,
       installing and operating the replacement or upgrade shall be included in
       the charges calculated in accordance with Article VIII. PRODUCER shall
       also be responsible for all costs related to the PRODUCTION FACILITY, if
       any, caused by said replacement and/or upgrade.

4.3    If PRODUCER plans any additions, modifications or replacements to the
       PRODUCTION FACILITY, PRODUCER shall use reasonable efforts to give
       NIAGARA MOHAWK not less than one (1) year prior written notice thereof
       accompanied by appropriate plans, specifications, information and
       operating instructions impacting NIAGARA MOHAWK'S electric operations, of
       any such addition, modification or replacement. All such additions,
       modifications or replacements shall meet NIAGARA MOHAWK'S ELECTRIC SYSTEM
       BULLETIN No. 756, NERC, NPCC, NYPP, NYSRC, or its respective successors,
       the standards of GOOD UTILITY PRACTICE and shall be subject to the
       approval of NIAGARA MOHAWK, which approval shall not unreasonably be
       withheld.

4.4    PRODUCER shall be responsible for the costs of any modifications to the
       INTERCONNECTION FACILITIES that arise from changes to the PRODUCTION
       FACILITY in accordance with this AGREEMENT.

4.5    If, during the term of this AGREEMENT, NIAGARA MOHAWK determines that it
       is necessary to relocate, rearrange, abandon, or retire its TRANSMIS-


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       SION SYSTEM, so that a change is required to a section of the
       INTERCONNECTION FACILITY, NIAGARA MOHAWK shall put forth its best efforts
       to give the PRODUCER no less than one (1) year's written notice of such
       relocation or rearrangement and shall use all reasonable efforts to defer
       such relocation or rearrangement until the INTERCONNECTION FACILITY can
       be reconfigured so that service may continue without interruption.

4.6    If NIAGARA MOHAWK is required or ordered by governmental authority to
       relocate, rearrange, abandon, or retire its TRANSMISSION SYSTEM requiring
       modification to the INTERCONNECTION FACILITY, NIAGARA MOHAWK shall put
       forth its best efforts to promptly so notify PRODUCER.

4.7    If relocation, rearrangement, abandonment, or retirement is required (as
       referred to in paragraphs 4.5 and 4.6), NIAGARA MOHAWK shall perform or
       have performed, at PRODUCER'S expense, the studies necessary to identify
       modifications to the INTERCONNECTION FACILITY and shall inform the
       PRODUCER of its estimate of the costs of the construction of the modified
       INTERCONNECTION FACILITY, and PRODUCER shall at its option either (i)
       reimburse NIAGARA MOHAWK for the actual costs of the construction of such
       modification in accordance with Article VIII of this AGREEMENT; (ii)
       construct, at its own expense, a new INTERCONNECTION FACILITY subject to
       the terms of this AGREEMENT; or (iii) terminate this AGREEMENT, upon no
       less than thirty (30) days written notice to NIAGARA MOHAWK.

4.8    If the relocation, rearrangement, abandonment, or retirement is ordered
       or required by governmental authority, NIAGARA MOHAWK shall use best
       efforts to obtain compensation on behalf of PRODUCER from such
       governmental authority for its mutually agreed upon share of the costs of
       such relocation or rearrangement, but in no event shall NIAGARA MOHAWK be
       responsible on its own account for reimbursing PRODUCER for any costs
       associated with such relocation or rearrangement.

4.9    If the PRODUCER elects to construct, at its own expense, a new section of
       the INTERCONNECTION FACILITY subject to the terms of this AGREEMENT, then
       the PRODUCER shall assign all rights, tide and interest in such new
       section of the INTERCONNECTION FACILITY to NIAGARA MOHAWK upon completion
       of construction and shall execute all necessary documents to effectuate
       transfer of ownership thereof to NIAGARA MO-


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       HAWK. PRODUCER shall obtain any necessary permits, authorizations and
       rights-of-way for the new section of the INTERCONNECTION FACILITY, in
       accordance with this AGREEMENT, the costs thereof to be borne by the
       PRODUCER If the PRODUCER elects to construct a new section of the
       INTERCONNECTION FACILITY, NIAGARA MOHAWK shall own, operate and maintain,
       at PRODUCER's expense, any such new section as part of the
       INTERCONNECTION FACILITY, and PRODUCER shall reimburse NIAGARA MOHAWK for
       all costs of operating and maintenance expenses for any new section of
       the INTERCONNECTION FACILITY in accordance with Article VIII.

4.10   PRODUCER acknowledges and agrees that NIAGARA MOHAWK reserves the rights
       and ability to deliver ELECTRICITY to all customers. If, during the term
       of this AGREEMENT, NIAGARA MOHAWK determines that it is necessary to
       relocate or rearrange the INTERCONNECTION POINT, in order to permit
       NIAGARA MOHAWK access or to deliver electricity to its customers or new
       customers, so that a change is required to a section of the
       INTERCONNECTION FACILITY, NIAGARA MOHAWK shall put forth its best efforts
       to give the PRODUCER no less than one (1) year's written notice of such
       relocation or rearrangement and shall use all reasonable efforts to defer
       such relocation or rearrangement until the INTERCONNECTION FACILITY can
       be reconfigured so that service to PRODUCER may continue without
       interruption. Such relocation or rearrangement as referenced in this
       paragraph 4.10 shall be at NIAGARA MOHAWK's or the customer(s)' expense.

4.11   If PRODUCER plans any unit retirements to the PRODUCTION FACILITY,
       PRODUCER shall put forth its best efforts to give NIAGARA MOHAWK
       reasonable notice. NIAGARA MOHAWK and PRODUCER shall amend this AGREEMENT
       to reflect such unit retirements including but not limited to adjustments
       to Article VIII of this AGREEMENT.


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                                   ARTICLE V
                                POWER DELIVERIES

5.1    METERING

       5.1.1  NIAGARA MOHAWK shall, at PRODUCER'S expense, provide, own, and
              maintain compatible metering equipment. PRODUCER shall provide
              suitable space within its facilities for installation of the
              metering equipment

       5.1.2  PRODUCER shall be responsible for providing all necessary
              communication equipment and transmission mediums, such as
              telephone lines and any necessary protection for such
              communication equipment and shall furthermore be responsible for
              all communication required by NIAGARA MOHAWK or NYPP or its
              successor.

       5.1.3  All metering equipment installed pursuant to this AGREEMENT and
              associated with the PRODUCTION FACILITY may be routinely tested by
              NIAGARA MOHAWK, in accordance with applicable NIAGARA MOHAWK,
              NYPP, NERC and GOOD UTILITY PRACTICE. PRODUCER may be present at
              such testing.

       5.1.4  If, at any time, any metering equipment is found to be inaccurate
              by more than the limits defined in 16 NYCRR Part 92 as may be
              amended from time to time, NIAGARA MOHAWK shall cause such
              metering equipment to be made accurate or replaced at PRODUCER'S
              expense. Meter readings for the period of inaccuracy shall be
              adjusted so far as the same can be reasonably ascertained;
              provided, however, no adjustment prior to the beginning of the
              preceding month shall be made except by agreement of the parties.
              Each party shall comply with any reasonable request of the other
              concerning the sealing of meters, the presence of a representative
              of the other party when the seals are broken and the tests are
              made, and other matters affecting the accuracy of the measurement
              of ELECTRICITY delivered from the PRODUCTION FACILITY. If either
              party believes that there has been a meter failure or stoppage, it
              shall immediately notify the other.


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       5.1.5  PRODUCER shall be responsible for purchasing and installing
              software, hardware and/or other technology that may be required to
              read output billing meters.

       5.1.6  Within sixty (60) days of the closing of the sale of the
              PRODUCTION FACILITY by NIAGARA MOHAWK, NIAGARA MOHAWK will take
              all necessary actions to bring the PRODUCTION FACILITY and the
              INTERCONNECTION FACILITY into full compliance with the
              requirements and specifications set forth in Sections 5.1.1
              through 5.1.5. Upon written certification by NIAGARA MOHAWK that
              the PRODUCTION FACILITY and INTERCONNECTION FACILITY are in
              compliance with Sections 5.1.1 through 5.1.5 then all subsequent
              compliance shall be PRODUCER'S responsibility.

5.2    LOSSES

       5.2.1  If the metering equipment and the DELIVERY POINT are not at the
              same location, the metering equipment shall record delivery of
              electricity in a manner that accounts for losses occurring between
              the metering point and the DELIVERY POINT. If the metering
              equipment does not have the capability of accounting for said
              losses, then either party may install metering equipment to
              account for said losses or the meter readings shall be multiplied
              by a loss factor to be mutually agreed to between NIAGARA MOHAWK
              and PRODUCER on the EFFECTIVE DATE to account for said losses
              between the metering point and the DELIVERY POINT. The metering
              point, DELIVERY POINT, associated equipment and distance between
              the metering point and the DELIVERY POINT shall be specified in
              Exhibit A.

5.3    REACTIVE POWER SUPPORT

       5.3.1  PRODUCER is required to provide reactive capability to regulate
              and maintain system voltage at the DELIVERY POINT in conformance
              with ELECTRIC SYSTEM BULLETIN No. 756. NIAGARA MOHAWK or NYPP or
              its successor shall establish a scheduled range of voltages or
              reactive power deliveries to be maintained by the generator.


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5.4    OPERATING FREQUENCY

5.4.1  PRODUCER is responsible for the proper coordination of any applied
       under/over frequency generator tripping as per 756, Appendix C, Section
       II, A, 2.7. If the PRODUCTION FACILITY elects to employ under frequency
       generator tripping protection, then the under frequency relay set point
       MUST be on or below the under frequency curve referred to in 756,
       Appendix C, Section IV, A., 3.0, Exhibit C-1. Similarly, if the
       PRODUCTION FACILITY elects to employ over frequency generator tripping
       protection, then the over frequency relay set point MUST be on or above
       the over frequency curve referred to in 756, Appendix C, Section IV, A.,
       3.0, Exhibit C-1. If the PRODUCTION FACILITY decides that, after
       consultation with NIAGARA MOHAWK, it cannot meet the under frequency
       -tripping set point limitation referred to in Exhibit C-1, then PRODUCER
       shall agree to fund the cost incurred by NIAGARA MOHAWK to install and
       maintain compensatory load shedding equipment required by the NYSRC. If
       the PRODUCER decides that it cannot meet the over frequency tripping set
       point limitation referred to in Exhibit C-1, PRODUCER shall consult with
       NIAGARA MOHAWK and NIAGARA MOHAWK will notify PRODUCER of any
       consequences associated with that decision.

5.5    OPERATING VOLTAGE

       5.5.1  PRODUCER is expected to adhere to the operating voltage
              performance referred to in 756 Appendix C, Section II, B, 2.2 and
              756 Appendix C, Section IV, B. PRODUCER is responsible for the
              proper coordination of any applied under/over voltage generator
              tripping as per 756, Appendix C, Section II, A, 2.7. If the
              PRODUCER elects to employ over voltage or under voltage
              protection, then the over voltage and under voltage relay settings
              shall be reviewed and approved by NIAGARA MOHAWK.

5.6    ISLANDING

       5.6.1  With reference to 756, Appendix C, Section II, A, 2.4, NIAGARA
              MOHAWK reserves the right to require, allow or prevent the
              ISLANDING of PRODUCER'S generation depending upon the


                                       14
<PAGE>   16


              prevailing NIAGARA MOHAWK electrical system operational needs at
              the time to the extent that PRODUCER'S PRODUCTION FACILITY was
              capable of same just prior to the date of this AGREEMENT.

5.7    PROTECTIVE DEVICE

       5.7.1  PRODUCER shall cooperate with NIAGARA MOHAWK on protective device
              settings and verification in accordance with 756, Appendix B,
              Section II, C and 756, Appendix C, Section V, B.


                                   ARTICLE VI
                              INSURANCE PROVISIONS

6.1    PRODUCER and NIAGARA MOHAWK shall obtain the insurance provided for in
       the Site Agreement between the two dated ________.


                                  ARTICLE VII
                              COMPLIANCE WITH LAWS

7.1    Each Party agrees to comply in all material respects with all applicable
       federal, state and local laws, ordinances, rules, regulations, permits,
       licenses, approvals, certificates, and requirements thereunder in
       connection with all its activities performed pursuant to this AGREEMENT,
       including, but not limited to all design, environmental, regulatory,
       engineering, construction, and property acquisition activities.

7.2    Each Party agrees to indemnify, defend, and save the other Party its
       agents and employees, harmless from, and against any loss, damage,
       liability (civil or criminal), cost, suit, charge, expense (including
       reasonable attorneys fees) or cause of action, arising from violations by
       the indemnifying Party of said laws, ordinances, rules, regulations,
       permits, licenses, approvals, certificates and requirements thereunder.
       Each Party agrees to bear fully all civil and criminal penalties that may
       arise from its activities or from its violations of or its failure to
       comply with the aforementioned laws and requirements, whether such
       penalties are assessed against PRODUCER or NIAGARA MOHAWK.


                                       15
<PAGE>   17


7.3    If either Party observes that any requirement specified in this AGREEMENT
       is at variance with any governing laws, ordinances, rules, regulations,
       permits, licenses, approvals, certificates and requirements thereunder,
       each Party shall promptly notify the other Party in writing before
       incurring any further liability, expense or obligation. NIAGARA MOHAWK
       and PRODUCER shall in good faith attempt to reform this AGREEMENT to
       comply with the aforementioned laws, ordinances, rules, regulations,
       permits, approvals, or certificates. If NIAGARA MOHAWK and PRODUCER, are
       unable to do so, either party may terminate this AGREEMENT.


                                  ARTICLE VIII
                                 COST PAYMENTS

8.1    NIAGARA MOHAWK shall invoice PRODUCER at the start of each calendar
       quarter in an amount equal to NIAGARA MOHAWK'S estimate for that
       quarter's costs and expenses for which NIAGARA MOHAWK is to be reimbursed
       under this AGREEMENT (excluding the charges referenced in paragraph
       8.2.6, 8.2.6.1 and 8.2.6.2), adjusted for the previous quarter's
       differential, if any, between NIAGARA MOHAWK'S estimated and actual
       costs.

8.2    PRODUCER shall reimburse NIAGARA MOHAWK for all of the following costs
       incurred by NIAGARA MOHAWK with respect to the INTERCONNECTION FACILITY
       and Interconnection upgrade facilities:

       8.2.1  All reasonable NIAGARA MOHAWK costs and expenses associated with
              the acquisition, ownership, operation, administration, inspection,
              design review, engineering, surveying, project management and
              coordination, testing of electrical equipment and installation of
              EMS-RTU and metering equipment, construction, financing,
              maintenance, environmental and regulatory permitting and licensing
              of, taxes and transfer of title and interest to, the
              INTERCONNECTION FACILITY, and any modified facility.

       8.2.2  All reasonable NIAGARA MOHAWK costs and expenses in connection
              with INTERCONNECTION STUDIES, if such INTERCONNECTION STUDIES are
              requested by PRODUCER, related to this INTERCONNECTION FACILITY.


                                       16
<PAGE>   18


       8.2.3  All reasonable NIAGARA MOHAWK costs and expenses of acquiring,
              owning, designing, engineering, constructing, financing, taxes,
              environmental permitting, and licensing, or any new or modified
              facilities.

       8.2.4  [Reserved.]

       8.2.5  Any capital costs associated with modifications performed in
              accordance with this AGREEMENT.

       8.2.6  The PRODUCER shall reimburse NIAGARA MOHAWK for any and all
              reasonable costs or expenses that are incurred by NIAGARA MOHAWK
              pursuant to this AGREEMENT for the operation, maintenance and
              repair of the INTERCONNECTION FACILITY.

              8.2.6.1 If requested by NIAGARA MOHAWK, such reimbursement shall
                      be made sufficiently in advance of NIAGARA MOHAWK
                      incurring the aforementioned costs or expense based on
                      NIAGARA MOHAWK's good faith estimate of such costs or
                      expense that may be paid promptly by NIAGARA MOHAWK when
                      due. Upon completion of the work contemplated hereunder,
                      NIAGARA MOHAWK will present PRODUCER with a summary of the
                      actual costs and expense incurred, together with
                      supporting documentation. In the event PRODUCER's advance
                      reimbursement hereunder exceeds NIAGARA MOHAWK's actual
                      costs, NIAGARA MOHAWK will refund PRODUCER's excess
                      payment to PRODUCER within ten (10) days of the date the
                      actual costs and expense summary was presented to
                      PRODUCER. In the event PRODUCER's advance reimbursement
                      hereunder is less than NIAGARA MOHAWK's actual costs,
                      PRODUCER will remit payment for the outstanding balance to
                      NIAGARA MOHAWK within ten (10) days of the date the actual
                      costs and expenses summary was presented to PRODUCER.

              8.2.6.2 Operation, maintenance and repair costs and expenses shall
                      include all reasonable costs and expenses associated with


                                       17
<PAGE>   19


                      operation, inspection, engineering and legal services,
                      contract administration, rights-of-way acquisition,
                      administrative and general, working capital (including
                      material adders, overhead charges, and transportation
                      charges), and allowed earnings and/or rates of return
                      approved by a regulatory body having jurisdiction,
                      incurred with respect to the INTERCONNECTION FACILITY,
                      including but not limited to, the following:

              (i)     Power Delivery
                      Inspections: Monthly substation inspections by a traveling
                      operator to inspect the INTERCONNECTION FACILITY for
                      physical indications of potential problems. This
                      inspection will not be charged if NIAGARA MOHAWK has
                      employees working at the substation in the course of a
                      month able to conduct such inspection in the normal course
                      of their duties.

                      Switching: Periodic switching to remove or install
                      electrical equipment in service for scheduled work
                      activities or during emergency conditions for equipment
                      restoration activities.

                      Disconnects: Maintenance activities associated with
                      disconnects based on work request generated by a traveling
                      operator or as part of equipment maintenance requirements.

                      Breakers: Preventive and corrective maintenance conducted
                      on high voltage circuit breakers based on field
                      observations, problems or per established maintenance
                      procedures intervals. -Relay PM: Preventive and corrective
                      maintenance conducted on relay related problems or per
                      established relay maintenance procedure intervals. -

              8.2.6.3 Notwithstanding the foregoing, operation and maintenance
                      on NIAGARA MOHAWK'S revenue metering for the PRODUCTION
                      FACILITY'S station service shall be in accordance with the
                      rates, term and conditions established in NIAGARA MOHAWK'S
                      Retail Tariff, Public Service Commission No. 207 -
                      Electricity ("the Retail Tariff"), as the same may be
                      modified by the New York State Public Service Commission.


                                       18
<PAGE>   20


              8.2.6.4 PRODUCER, upon thirty (30) days written notice to NIAGARA
                      MOHAWK, shall have the right to audit NIAGARA MOHAWK'S O&M
                      records for the INTERCONNECTION FACILITY on an annual
                      basis.

       8.2.7  Any and all federal, state or local taxes levied or assessed on
              NIAGARA MOHAWK, with respect to the ownership of the
              INTERCONNECTION FACILITY (other than income or excess profits
              tax); provided, however, that NIAGARA MOHAWK and PRODUCER shall
              agree upon an equitable allocation of any such taxes between the
              parties. If any form of tax, other than income or excess profits
              tax, under any present or future federal, state or other law
              different from or in addition to the taxes for which participation
              in or payment by PRODUCER is provided herein or elsewhere in this
              AGREEMENT, should be levied or assessed against or incurred by
              NIAGARA MOHAWK with respect to any property or property right
              arising from NIAGARA MOHAWK'S ownership of the INTERCONNECTION
              FACILITY which different or additional tax would not be required
              to be paid by NIAGARA MOHAWK in the absence of this AGREEMENT and,
              with respect to such different or additional tax, no obligation of
              PRODUCER to participate or pay would have attached under the
              provisions of this AGREEMENT elsewhere than in this paragraph,
              then in such event PRODUCER and NIAGARA MOHAWK shall agree upon an
              equitable allocation of such different or additional tax.

       8.2.8  NIAGARA MOHAWK agrees to cooperate with PRODUCER in attempting to
              minimize costs under this Article, provided PRODUCER reimburses
              NIAGARA MOHAWK for all costs incurred by NIAGARA MOHAWK in
              connection with such cooperation, including reasonable attorneys
              fees, and provided further that PRODUCER shall indemnify, defend,
              and save harmless NIAGARA MOHAWK its agents and employees, against
              any and all penalties, judgments, fines civil or criminal, or
              other costs that may be imposed by any governmental authority as a
              result of actions undertaken at the specific request or
              concurrence of the PRODUCER.

8.3    PRODUCER agrees to pay all invoices within thirty (30) days from date of
       the invoice. If any invoice remains unpaid thirty (30) days from the
       invoice


                                       19
<PAGE>   21


       date, NIAGARA MOHAWK shall apply to the unpaid balance, and PRODUCER
       shall pay, a finance charge at the rate of interest equal to the Prime
       Rate as may from time to time be published in The Wall Street Journal
       under "Money Rates" ("INTEREST RATE"), plus 2% per month, but in no event
       more than the maximum allowed by law.

8.4    Billing Disputes. If PRODUCER, in good faith, disputes an invoice,
       PRODUCER shall immediately notify NIAGARA MOHAWK of the basis for the
       dispute and pay the portion of such statement conceded to be correct no
       later than the due date. Consistent with Section 10.4 herein, if any
       amount withheld under dispute by PRODUCER is ultimately determined (under
       terms herein) to be due to NIAGARA MOHAWK, said funds held in escrow
       shall be paid to NIAGARA MOHAWK within one (1) Business Day of such
       determination along with interest accrued at the INTEREST RATE until date
       paid. Inadvertent overpayments shall be returned by NIAGARA MOHAWK upon
       request or deducted by NIAGARA MOHAWK from subsequent payments, with
       interest accrued at the INTEREST RATE from the date originally paid until
       the date paid or deducted.

8.5    In the event that NIAGARA MOHAWK is the purchaser of power from the
       PRODUCTION FACILITY, any outstanding invoices which the PRODUCER has not
       paid to NIAGARA MOHAWK shall be deducted from the payments due PRODUCER
       by NIAGARA MOHAWK.


                                   ARTICLE IX
                                    NOTICES

9.1    All notices required or permitted under this AGREEMENT shall be in
       writing and shall be personally delivered or sent by certified or
       registered first class mail, postage prepaid, telex, facsimile
       transmission, or overnight express mail or courier service addressed as
       follows:


                                       20
<PAGE>   22


       TO PRODUCER:                         TO      NIAGARA MOHAWK
                                                    POWER CORPORATION:
       HUNTLEY POWER LLC                            MANAGER - TRANSMISSION
       c/o NRG ENERGY, INC.                             & DELIVERY SERVICES
       1221 Nicollet Mall                           300 Erie Boulevard West
       Minneapolis, MN 55403                        Syracuse, New York 13202
       Attn: Vice President & General Counsel       (315) 460-2575
       (612) 373-5392


9.2    Either party may change its address for notices by notice to the other in
       the manner provided above.

9.3    Notwithstanding paragraph 9.1, any notice hereunder, with respect to a
       system emergency or other occurrence requiring prompt attention, may be
       made by telephone provided that such notice is confirmed in writing
       promptly thereafter.

9.4    These representatives as noted in paragraph 9.1 or their designees shall
       be authorized to act on behalf of the parties, and their instructions,
       requests, and decisions will be binding upon the parties as to all
       matters pertaining to this AGREEMENT and the performance of the parties
       hereunder. Only these representatives shall have the authority to commit
       funds or make binding obligations on behalf of the parties. These
       representatives shall be responsible for tracking work, costs, schedules
       and all other matters related to this AGREEMENT, and to the performance
       of any third parties.


                                   ARTICLE X
                              TERM AND TERMINATION

10.1   This AGREEMENT shall become effective as of the date first above written
       (the "EFFECTIVE DATE"), subject to its approval or acceptance for filing
       by the FERC, and shall continue in effect for twenty (20) years.

10.2   This AGREEMENT shall not merge with or be terminated or superseded by any
       future agreement between the parties that does not specifically so
       provide.


                                       21
<PAGE>   23


10.3   In the event PRODUCER abandons the PRODUCTION FACILITY; becomes
       insolvent; or assigns or sublets this AGREEMENT in a manner inconsistent
       with this AGREEMENT, or is violating any of the material conditions,
       terms, obligations, or covenants of this AGREEMENT, NIAGARA MOHAWK may
       terminate this AGREEMENT. Before instituting proceedings before FERC to
       terminate the AGREEMENT, NIAGARA MOHAWK must give PRODUCER written notice
       of the reasons for termination. If within a period of thirty (30) days of
       such notice PRODUCER cures the default or breach cited by NIAGARA MOHAWK
       in such notice, to the reasonable satisfaction of NIAGARA MOHAWK, and
       shall have complied with the provisions of this AGREEMENT, such notice
       shall become null and void and of no effect. Notwithstanding the
       foregoing, NIAGARA MOHAWK and PRODUCER may terminate this AGREEMENT upon
       mutual agreement set forth in writing; provided, however that the
       requesting party provides at least sixty (60) days written notice of
       intent to terminate.

10.4   In the event of a billing dispute as set forth in Section 8.4 of this
       AGREEMENT between NIAGARA MOHAWK and the PRODUCER, NIAGARA MOHAWK will
       not apply to remove the INTERCONNECTION FACILITIES from service or to
       terminate transmission service thereon as long as the PRODUCER: (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 such dispute. If the PRODUCER fails to meet these two
       requirements, then a default shall be deemed to exist, to which the
       procedures set forth in this section for the disconnection of the
       INTERCONNECTION FACILITIES from service shall apply.

10.5   Termination of this AGREEMENT shall not relieve PRODUCER of any of its
       liabilities and obligations arising hereunder prior to the date
       termination becomes effective, and NIAGARA MOHAWK may take whatever
       judicial or administrative actions as appear necessary or desirable to
       enforce its rights hereunder. The rights specified herein are not
       exclusive and shall be in addition to all other remedies available to
       NIAGARA MOHAWK, either at law or in equity, for default or breach of any
       provision of this AGREEMENT.

10.6   In the event of termination of this AGREEMENT in accordance with Article
       X, NIAGARA MOHAWK will physically disconnect the PRODUCTION FACILITY from
       the TRANSMISSION SYSTEM and at NIAGARA MO-



                                       22
<PAGE>   24


       HAWK'S sole determination remove any or all of NIAGARA MOHAWK'S
       INTERCONNECTION FACILITY equipment.


                                   ARTICLE XI
                                 FORCE MAJEURE

11.1   Neither party shall be considered to be in default or breach hereunder,
       and shall be excused from performance hereunder, if and to the extent
       that it shall be delayed in or prevented from performing or carrying out
       any provisions of this AGREEMENT by reason of storm, flood, lightning
       strikes, earthquake, fire, ice, snow, epidemic, war, invasion, riot,
       civil disturbance, sabotage, explosion, insurrection, military or usurped
       power, strikes, stoppage of labor, labor dispute, failure of contractors
       or suppliers of material, action of any court or governmental authority,
       or any civil or military authority de facto or de jure, change in law,
       act of God or the public enemy, or any other cause beyond either party's
       control; including, without limitation, disconnection or limited
       operation of NIAGARA MOHAWK'S electric system, unscheduled repairs or
       maintenance, fuel or energy shortages, or equipment breakdown.

11.2   The party claiming force majeure shall use due diligence to resume
       performance or the provision of service hereunder as soon as practicable.

11.3   Neither party shall be liable to the other party for or on account of any
       loss, damage, injury or expense, including, but not limited to, special,
       indirect and consequential damages, resulting from or arising out of such
       delay or inability to perform.


                                  ARTICLE XII
                          RELATIONSHIP OF THE PARTIES

12.1   Nothing contained in this AGREEMENT shall be construed or deemed to
       cause, create, constitute, give effect to, or otherwise recognize
       PRODUCER and NIAGARA MOHAWK to be partners, joint venturers, employer and
       employee, principal agent, or any other business association, with
       respect to any matter.


                                       23
<PAGE>   25


12.2   Unless otherwise agreed to in writing signed by both parties, neither
       party shall have any authority to create or assume in the other party's
       name or on its behalf any obligation, express or implied or to act or
       purport to act as the other party's agent or legal empowered
       representative for any purpose whatsoever.

12.3   Neither party shall be liable to any third party in any way for any
       engagement, obligation, commitment, contract, representation or for any
       negligent act or omission to act of the other party, except as expressly
       provided for herein.

12.4   The rights and obligations of the parties shall be limited to those
       expressly set forth herein.


                                  ARTICLE XIII
                       THIRD PARTY BENEFICIARY/ASSIGNMENT

13.1   No person or party shall have any rights or interests, direct or
       indirect, in this AGREEMENT or the services or facilities to be provided
       hereunder, or both, except the parties, theft successors, and authorized
       assigns.

13.2   The parties specifically disclaim any intent to create any rights in any
       person or party as a third-party beneficiary to this AGREEMENT or to the
       services or facilities to be provided hereunder, or both.

13.3   PRODUCER may assign or collaterally assign this AGREEMENT to lenders, or
       any financial institution participating in financing PRODUCER's
       INTERCONNECTION FACILITY or property acquisition, or to any partnerships
       created to operate PRODUCER's facilities, or to any other parties,
       including affiliates or partnerships, upon prior written notification to
       NIAGARA MOHAWK

13.4   PRODUCER agrees to reimburse NIAGARA MOHAWK for costs and expenses
       (including reasonable fees and expenses of NIAGARA MOHAWK'S counsel)
       incurred in connection with NIAGARA MOHAWK'S review, execution and
       delivery of instruments, agreements or documents necessary in connection
       with the PRODUCER'S assignment, transfer, sale or


                                       24
<PAGE>   26


       other disposition of this AGREEMENT or any interest in the
       INTERCONNECTION FACILITY.

13.5   Any assignment in violation of Article XIII shall be considered null and
       void from its inception.

13.6   Any NIAGARA MOHAWK authorized assignment shall not relieve PRODUCER of
       the responsibility of full compliance with the requirements of this
       AGREEMENT.

13.7   PRODUCER shall not make any assignment unless and until its successor in
       interest has agreed to undertake the obligations accepted by PRODUCER
       herein, and has provided written assurances to NIAGARA MOHAWK of
       continued performance and protection against liability upon assignment.

13.8   Assignment contrary to the provisions of this AGREEMENT shall make
       PRODUCER the indemnitor of NIAGARA MOHAWK and its successors, against any
       liabilities and costs, including reasonable attorneys fees as to which
       PRODUCER'S transferee fails to indemnify, defend, and hold harmless
       NIAGARA MOHAWK, its agents, employees and its successors, from and
       against any loss, damage, liability (civil or criminal), cost, suit,
       charge, expense (including reasonable attorneys fees) or cause of action,
       whether unconditionally certain or otherwise, incurred by NIAGARA MOHAWK
       as a result of said assignment or as a result of any dispute between
       PRODUCER and its transferees, or between any subsequent transferees, that
       arises from or relates to any assignment by PRODUCER.

13.9   This AGREEMENT shall bind and inure to the benefit of the parties to this
       AGREEMENT, their successors and permitted assigns.


                                   ARTICLE XIV
                                    APPROVAL

14.1   NIAGARA MOHAWK shall file this AGREEMENT with the appropriate regulatory
       authorities. If such regulatory body substantially modifies the terms and
       conditions of this AGREEMENT, either party shall have the right to
       unilaterally terminate this AGREEMENT.


                                       25
<PAGE>   27


14.2   This AGREEMENT is entered into subject to authorization by, or
       requirements of regulatory authorities having jurisdiction in respect to
       this AGREEMENT.

14.3   Nothing contained in this AGREEMENT shall be construed as affecting in
       any way the right of NIAGARA MOHAWK to unilaterally make application to
       the FERC for a change in rates, terms and conditions under Section 205 of
       the Federal Power Act and pursuant to the Commission's rules and
       regulations.


                                   ARTICLE XV
                                     WAIVER

15.1   No provision of this AGREEMENT may be waived except by mutual agreement
       of the parties as expressed in writing and signed by both parties.

15.2   Any waiver that is not in writing and signed by both parties shall be
       null and void from its inception.

15.3   No express waiver in any specific instance as provided in a required
       writing shall be construed as a waiver of future instances unless
       specifically so provided in the required writing.

15.4   No express waiver of any specific default shall be deemed a waiver of any
       other default whether or not similar to the default waived, or a
       continuing waiver of any other right or default by a party.

15.5   The failure of either party to insist in any one or more instances upon
       the strict performance of any of the provisions of this AGREEMENT, or to
       exercise any right herein, shall not be construed as a waiver or
       relinquishment for the future of such strict performance of such
       provision or the exercise of such right.


                                       26
<PAGE>   28


                                   ARTICLE XVI
                           AMENDMENT AND MODIFICATION

16.1   This AGREEMENT may be amended or modified only if the amendment or
       modification is in writing and executed by both parties. Any amendment or
       modification that is not in writing and signed by both parties shall be
       null and void from its inception.

16.2   No express amendment or modification in any specific instance as provided
       herein shall be construed as an amendment or modification of future
       instances, unless specifically so provided in the required writing. -

16.3   Nothing in this AGREEMENT shall be construed as affecting in any way the
       ability of the PRODUCER to exercise its rights under the Federal Power
       Act and pursuant to FERC's rules and regulations promulgated thereunder.


                                  ARTICLE XVII
                                  GOVERNING LAW

17.1   This AGREEMENT and the rights and obligations of the parties to this
       AGREEMENT shall be governed by and construed in accordance with the laws
       of the State of New York.

17.2   PRODUCER and NIAGARA MOHAWK agree to submit to the jurisdiction of the
       courts in the State of New York for the purposes of interpretation and
       enforcement of this AGREEMENT.

17.3   PRODUCER and NIAGARA MOHAWK may waive personal service by manual delivery
       and agree that service of process on PRODUCER and NIAGARA MOHAWK in any
       action concerning or arising out of this AGREEMENT may be made by
       registered or certified mail, return receipt requested, delivered to
       PRODUCER and NIAGARA MOHAWK at its address set forth in Article IX.


                                       27
<PAGE>   29


                                  ARTICLE XVIII
                               DISPUTE RESOLUTION

18.1   Any claim or dispute, which either party may have against the other,
       arising out of the AGREEMENT shall be submitted in writing to the other
       party not later than sixty (60) days after the circumstances which gave
       rise to the claim or dispute have taken place. The submission of any
       claim or dispute shall include a concise statement of the question or
       issue in dispute, together with relevant facts and documentation to fully
       support the claim.

18.2   If any such claim or dispute arises, the parties shall use their best
       efforts to resolve the claim or dispute, initially through good faith
       negotiations or upon the failure of such negotiations, through
       Alternative Dispute Resolution ("ADR") techniques in accordance with the
       Model Procedure for Mediation of Business Disputes as published by the
       Center for Public Resources; however, either party may terminate its
       participation in ADR during any stage of ADR and proceed under paragraph
       18.3.

18.3   If any claim or dispute arising hereunder is not resolved pursuant to
       paragraph 18.2, either party may, upon giving the other party at least
       ten (10) days prior written notice, initiate litigation to submit such
       claim or dispute for decision by a court of competent jurisdiction.

18.4   Nothing in this Article XVIII shall restrict the rights of any party to
       file a complaint with FERC under relevant provisions of the Federal Power
       Act


                                   ARTICLE XIX
                                  SEVERABILITY

19.1   If any term of this AGREEMENT, or the interpretation or application of
       any term or provision to any prior circumstance, is held to be
       unenforceable, illegal, or invalid by any governmental agency or court of
       competent jurisdiction, the remainder of this AGREEMENT, or the
       interpretation or application of all other terms or provisions to persons
       or circumstances other than those that are unenforceable, illegal, or
       invalid, shall not be affected thereby and each term and provision shall
       be valid and be enforced to the fullest extent permitted by law.


                                       28
<PAGE>   30


                                   ARTICLE XX
                                    HEADINGS

20.1   The headings in this AGREEMENT are included herein for convenience of
       reference only and shall not constitute a part of this AGREEMENT for any
       other purpose, or limit or be used as an aid in construing the provisions
       of this AGREEMENT.


                                   ARTICLE XXI
                        INTEGRATION/MERGER/SURVIVABILITY

21.1   This AGREEMENT sets forth the entire understanding and agreement of the
       parties as to the subject matter of this AGREEMENT and merges and
       supersedes all prior agreements, commitments, representations, writings
       and discussions between the parties with respect to the INTERCONNECTION
       FACILITY.

21.2   The obligations of the PRODUCER shall survive the completion,
       termination, or abandonment of this AGREEMENT and of the PRODUCER'S
       facilities and work.


                                  ARTICLE XXII
                            COMPLIANCE WITH THE NERC

22.1   Both parties agree to comply with any existing or future criteria,
       guides, and procedures established by the NERC or any successor
       organization to ensure the continued reliability of North America's
       interconnected bulk electric systems.


                                 ARTICLE XXIII
                                  COUNTERPARTS

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


                                       29
<PAGE>   31


IN WITNESS WHEREOF, the parties hereto have caused this instrument to be
executed as of the day and year first above written.

<TABLE>
<CAPTION>

HUNTLEY POWER LLC                          NIAGARA MOHAWK POWER
                                             CORPORATION
<S>                                        <C>
By: /s/ Craig A. Mataczynski               By: /s/ Clement E. Nadeau
   ------------------------------             ------------------------------

Title: President                           Title: Vice President
      ---------------------------                ---------------------------

Date: 4/15/99                              Date: April 20, 1999
      ---------------------------                ---------------------------
</TABLE>



                                       30