Exhibit
    4.3

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ANNEX 1









ELECTRICITY ACT 1989
SECTION 6(1)(c)















| | ELECTRICITY
          DISTRIBUTION LICENCE {"ANNEX 1
THE DISTRIBUTION LICENCE" } | 
| | -------------------------------------------------------------------------------- | 



FOR





NORWEB PLC



1

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|PART I - TERMS OF THE LICENCE                                    
|-----------------------------------------------------------------
|                                                                 
|PART II  THE STANDARD CONDITIONS                                
|                                                                 
|PART III  AMENDMENTS TO STANDARD CONDITIONS                     
|                                                                 
|PART IV  SPECIAL CONDITIONS                                     
|                                                                 
|SPECIAL CONDITION B  RESTRICTION OF DISTRIBUTION CHARGES        
|                                                                 
|SPECIAL CONDITION C  RESTRICTION OF DISTRIBUTION CHARGES:       
|ADJUSTMENTS                                                      
|                                                                 
|SPECIAL CONDITION D  INFORMATION TO BE PROVIDED TO THE AUTHORITY
|                                                                 
|SPECIAL CONDITION E  ALLOWANCE IN RESPECT OF SECURITY COSTS     
|                                                                 
|SPECIAL CONDITION F  DURATION OF CHARGE RESTRICTION CONDITIONS  
|                                                                 
|SCHEDULE A  SUPPLEMENTARY PROVISIONS OF THE CHARGE RESTRICITION 
|CONDITONS                                                        
|                                                                 
|SCHEDULE 1  SPECIFIED AREA                                      
|                                                                 
|SCHEDULE 2  REVOCATION                                          
|                                                                 
|SCHEDULE 3  DISTRIBUTION SERVICES AREA                          

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PART I
  - TERMS OF THE LICENCE



|1.                                                                                                                                                                                                                                                                      | This licence,
        treated as granted under section 6(1)(c) of the electricity act 1989
        (the act), authorises NORWEB plc (a company registered in
        England and Wales under number 2366949) (the licensee) whose
        registered office is situated at Dawson House, Great Sankey, Warrington,
        Cheshire WA5 3LW to distribute electricity for the purpose of giving
        a supply to any premises in the specified area in schedule 1 or enabling
        a supply to be so given during the period specified in paragraph 3 below,
    subject to:
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|                                                                                                                                                                                                                                                                        |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|                                                                                                                                                                                                                                                                        | (a)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|                                                                                                                                                                                                                                                                        |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|                                                                                                                                                                                                                                                                        | (b)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|                                                                                                                                                                                                                                                                        |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|                                                                                                                                                                                                                                                                        | (c)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|                                                                                                                                                                                                                                                                        |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|2.                                                                                                                                                                                                                                                                      | This licence
        is subject to transfer, modification or amendment in accordance with
    the provisions of the Act, the special conditions or the conditions.                                                                                                                                                                                                                                                                                                                                                                                                                    
|                                                                                                                                                                                                                                                                        |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|3.                                                                                                                                                                                                                                                                      | This licence,
        unless revoked in accordance with the terms of Schedule 2, shall continue
        until determined by not less than 25 years notice in writing given
    by the Authority to the licensee.                                                                                                                                                                                                                                                                                                                                                                     
|                                                                                                                                                                                                                                                                        |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|4.                                                                                                                                                                                                                                                                      | The provisions
        of section 109(1) of the Act (Service of documents) shall have effect
        as if set out herein as if for the words this Act there were
    substituted the words this licence.                                                                                                                                                                                                                                                                                                                                                                         
|                                                                                                                                                                                                                                                                        |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|5.                                                                                                                                                                                                                                                                      | Without
        prejudice to sections 11 and 23(1) of the Interpretation Act 1978, Part
        I to IV inclusive of, and the Schedules to, this licence shall be interpreted
        and construed in like manner as an Act of Parliament passed after the
    commencement of the Interpretation Act 1978.                                                                                                                                                                                                                                                                          
|                                                                                                                                                                                                                                                                        |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|6.                                                                                                                                                                                                                                                                      | References
        in this licence to a provision of any enactment, where after the date
    of this licence                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|                                                                                                                                                                                                                                                                        |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|                                                                                                                                                                                                                                                                        | (a)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|                                                                                                                                                                                                                                                                        |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|                                                                                                                                                                                                                                                                        | (b)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|                                                                                                                                                                                                                                                                        |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|                                                                                                                                                                                                                                                                        | shall be
        construed, so far as the context permits, as including a reference to
    the corresponding provision of that other enactment.                                                                                                                                                                                                                                                                                                                                                                                                                                       
|                                                                                                                                                                                                                                                                        |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|7.                                                                                                                                                                                                                                                                      | Pursuant
        to paragraph 5 of standard condition 2 (Application of Section C (Distribution
        Services Obligations)) of the Electricity Distribution Licence the distribution
    services area is specified in Schedule 3 hereto.                                                                                                                                                                                                                                                                                                                                        
|                                                                                                                                                                                                                                                                        |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|Pursuant
        to a licensing scheme made by the Secretary of State under Part II of
        Schedule 7 to the Utilities Act 2000 on 28 September 2001 this licence
        was made and is treated as granted under section 6(1)(c) of the Electricity
    Act 1989.

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PART
II  THE STANDARD CONDITIONS

Standard
conditions in effect in this licence

|Section A            | Section B              | Section C         
|-------------------- | ---------------------- | ------------------
|                     |                        |                   
|Standard condition 1 | Standard condition 4   | Standard condition
|                     |                        |                   
|Standard condition 2 | Standard condition 4A  | Standard condition
|                     |                        |                   
|Standard condition 3 | Standard condition 4B  | Standard condition
|                     |                        |                   
|                     | Standard condition 4C  | Standard condition
|                     |                        |                   
|                     | Standard condition 5   | Standard condition
|                     |                        |                   
|                     | Standard condition 6   | Standard condition
|                     |                        |                   
|                     | Standard condition 7   | Standard condition
|                     |                        |                   
|                     | Standard condition 8   | Standard condition
|                     |                        |                   
|                     | Standard condition 9   | Standard condition
|                     |                        |                   
|                     | Standard condition 9A  | Standard condition
|                     |                        |                   
|                     | Standard condition 10  | Standard condition
|                     |                        |                   
|                     | Standard condition 11  | Standard condition
|                     |                        |                   
|                     | Standard condition 12  | Standard condition
|                     |                        |                   
|                     | Standard condition 12A | Standard condition
|                     |                        |                   
|                     | Standard condition 13  | Standard condition
|                     |                        |                   
|                     | Standard condition 14  | Standard condition
|                     |                        |                   
|                     | Standard condition 15  | Standard condition
|                     |                        |                   
|                     | Standard condition 16  | Standard condition
|                     |                        |                   
|                     | Standard condition 17  | Standard condition
|                     |                        |                   
|                     | Standard condition 18  | Standard condition
|                     |                        |                   
|                     | Standard condition 19  | Standard condition
|                     |                        |                   
|                     | Standard condition 20  | Standard condition
|                     |                        |                   
|                     | Standard condition 21  |                   
|                     |                        |                   
|                     | Standard condition 22  |                   
|                     |                        |                   
|                     | Standard condition 23  |                   
|                     |                        |                   
|                     | Standard condition 24  |                   
|                     |                        |                   
|                     | Standard condition 25  |                   
|                     |                        |                   
|                     | Standard condition 26  |                   
|                     |                        |                   
|                     | Standard condition 29  |                   

Note: A copy of the current standard conditions of electricity distribution licences can be inspected at the principal office of the Authority. The above list is correct at the date of this licence but may be changed by subsequent amendments or modifications to the licence.  The authoritative up-to-date version of this licence is available for public inspection at the principal office of the Authority.


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PART III  AMENDMENTS TO THE STANDARD CONDITIONS

There are no amendments to the standard conditions of electricity distribution licences.

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PART IV - SPECIAL CONDITIONS

Special Condition A: Definitions and interpretation

|1. | Unless the context otherwise requires, words and expressions used in the standard conditions of this licence shall bear the same meaning in these Special Conditions.                                 
|-- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                                                                                       
|2. | Special Conditions B to F and Schedule A to those Conditions shall only apply to the distribution services area (as defined in standard condition 1 (Definitions and Interpretation)) of the licensee.
|   |                                                                                                                                                                                                       
|3  | In
    Special Conditions B to F and Schedule A to those Conditions:                                                                                                                                  

| |  |                                     |                                                                                                                                                                                                                                                                                                                                       |                                                                                                                                                                                                                                   
| |  | ----------------------------------- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | attributed                        | means when
        used in relation to transmission connectionpoint
        charges or remote transmission asset rentals ordistribution
        losses, attributed in accordance with theprinciples
        set out in Part A of Schedule A and attribute,attributed,
    attributable and attribution shall be construedaccordingly.
| |  |                                     |                                                                                                                                                                                                                                                                                                                                       |                                                                                                                                                                                                                                   
| |  | averagechargeperunitdistributed   | means the
        distribution revenue in the relevant yeardivided
    by the regulated quantity distributed in that year.                                                                                                                                                                                                           
| |  |                                     |                                                                                                                                                                                                                                                                                                                                       |                                                                                                                                                                                                                                   
| |  | average
    specified rate        | means the
        average of the daily base rates of BarclaysBank
        plc current from time to time during the period inrespect
    of which the calculation falls to be made.                                                                                                                                                   
| |  |                                     |                                                                                                                                                                                                                                                                                                                                       |                                                                                                                                                                                                                                   
| |  | charge
    restriction conditions | means Special
        Conditions A to F inclusive together withSchedule
        A to this licence, as from time to time modifiedor
    replaced in accordance with the provisions of the Act.                                                                                                                                        
| |  |                                     |                                                                                                                                                                                                                                                                                                                                       |                                                                                                                                                                                                                                   
| |  | distribution
    losses           | means units
        unaccounted for on the licenseesdistribution
        system, measured as being the differencebetween
        the units metered on entry into the system andthe
    units metered on leaving the system.                                                                                                         
| |  |                                     |                                                                                                                                                                                                                                                                                                                                       |                                                                                                                                                                                                                                   
| |  | distribution
    revenue          | means the
        revenue (measured on an accruals basis)derived
        by the licensee from the provision of distributionservices
    in the relevant year, after deduction of:                                                                                                                                                    
| |  |                                     |                                                                                                                                                                                                                                                                                                                                       |                                                                                                                                                                                                                                   
| |  |                                     | (i)                                                                                                                                                                                                                                                                                                                                   | an amount
        equal to such part of the total amountpayable
        in that relevant year to the transmissioncompany
        (measured on an accruals basis) in respectof
    transmission connection point charges and remote

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| |  |                          |      | transmission
      asset rentals and which would otherwise be included in distribution revenue
      by reason of being recovered in that relevant year by the licensee in its
      use of system charges, as falls to be attributed to the regulated quantity
    distributed in that relevant year; and                                                                                                                                                   
| |  | ------------------------ | ---- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  |                          |      |                                                                                                                                                                                                                                                                                                                                                                                                                                                              
| |  |                          | (ii) | value added
    tax (if any) and any other taxes based directly on the amounts so derived.                                                                                                                                                                                                                                                                                                                                                                   
| |  |                          |      |                                                                                                                                                                                                                                                                                                                                                                                                                                                              
| |  | distribution services  |      | means all
       services provided by the licensee as part of its distribution business
       other than excluded services.                                                                                                                                                                                                                                                                                                                                 
| |  |                          |      |                                                                                                                                                                                                                                                                                                                                                                                                                                                              
| |  | EHV premises           |      | means those
       premises to which units are delivered by the licensee which fall to be
       treated as EHV premises in accordance with Part B of Schedule A.                                                                                                                                                                                                                                                                                            
| |  |                          |      |                                                                                                                                                                                                                                                                                                                                                                                                                                                              
| |  | EHV units              |      | means units
       distributed by the licensee which are delivered or deemed to be delivered
       to EHV premises.                                                                                                                                                                                                                                                                                                                                         
| |  |                          |      |                                                                                                                                                                                                                                                                                                                                                                                                                                                              
| |  | eleventh relevant year |      | means the relevant year commencing 1stApril 2000.                                                                                                                                                                                                                                                                                                                                                                                                            
| |  |                          |      |                                                                                                                                                                                                                                                                                                                                                                                                                                                              
| |  | excluded services      |      | means those
       services provided by the licensee which in accordance with the principles
       set out in Part C of Schedule A fall to be treated as excluded services.                                                                                                                                                                                                                                                                                 
| |  |                          |      |                                                                                                                                                                                                                                                                                                                                                                                                                                                              
| |  | HV units               |      | means units
       (other than EHV units) distributed by the licensee which are delivered
       to premises connected to the licensees distribution system at a
       voltage at or higher than 1000 volts.                                                                                                                                                                                                                                               
| |  |                          |      |                                                                                                                                                                                                                                                                                                                                                                                                                                                              
| |  | LV units               |      | means units
       distributed by the licensee which are delivered to premises connected
       to the licensees distribution system at a voltage less than 1000
       volts.                                                                                                                                                                                                                                                                              
| |  |                          |      |                                                                                                                                                                                                                                                                                                                                                                                                                                                              
| |  | LV1 units              |      | means LV
       units which are distributed by the licensee outside night-time periods
       to domestic premises or small premises (other than domestic premises)
       where the appropriate use of system charges apply different rates in night-time
       periods as opposed to other times of day, for the avoidance of doubt including
       the use of system charges under the tariffs specified in paragraph D2
       of Part D of Schedule A.
| |  |                          |      |                                                                                                                                                                                                                                                                                                                                                                                                                                                              
| |  | LV2 units              |      | means LV
       units which are distributed by the licensee to domestic premises or small
       premises (other than                                                                                                                                                                                                                                                                                                                                        

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| |  |                                                   | domestic
    premises):                                                                                                                                                                                                                                                                              
| |  | ------------------------------------------------- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  |                                                   |                                                                                                                                                                                                                                                                                                      
| |  |                                                   | (a)                                                                                                                                                                                                                                                                                                  
| |  |                                                   |                                                                                                                                                                                                                                                                                                      
| |  |                                                   | (b)                                                                                                                                                                                                                                                                                                  
| |  |                                                   |                                                                                                                                                                                                                                                                                                      
| |  |                                                   | for
        the avoidance of doubt including the use of system charges under the
    tariffs specified in paragraph D3 of Part D of Schedule A.                                                                                                                                                      
| |  |                                                   |                                                                                                                                                                                                                                                                                                      
| |  | LV3
    units                                   | means
        LV units other than LV1 and LV2 units, for the avoidance of doubt including
        units distributed under the tariffs specified in paragraph D4 of Part
    D of Schedule A.                                                                                                         
| |  |                                                   |                                                                                                                                                                                                                                                                                                      
| |  | maximum
    average charge per unit distributed | means
      the charge calculated in accordance with the formula in paragraph 1 of Special
      Condition B (Restriction
      of distribution charges).                                                                                                                                            
| |  |                                                   |                                                                                                                                                                                                                                                                                                      
| |  | metered                                         | means
        in relation to any quantity distributed as measured by a meter installed
        for such purpose or (where no such meter is installed or it is not reasonably
        practicable to measure the quantity by such meter) as otherwise reasonably
    calculated.                      
| |  |                                                   |                                                                                                                                                                                                                                                                                                      
| |  | regulated
    distribution	unit category        | means
    as the case may be HV units or LV1 units or LV2	units or LV3 units.                                                                                                                                                                                                                        
| |  |                                                   |                                                                                                                                                                                                                                                                                                      
| |  | regulated
    quantity distributed              | means
      the aggregate quantity of units distributed (for any person under use of
      system)
      by the licensee through the licensees distribution system in relevant
      year t metered at exit points on leaving the licensees distribution
    system but excluding for this purpose:
| |  |                                                   |                                                                                                                                                                                                                                                                                                      
| |  |                                                   | (a)                                                                                                                                                                                                                                                                                                  
| |  |                                                   |                                                                                                                                                                                                                                                                                                      
| |  |                                                   | (b)                                                                                                                                                                                                                                                                                                  
| |  |                                                   |                                                                                                                                                                                                                                                                                                      
| |  | relevant
    year                               | means
        a financial year commencing on or after 1st April                                                                                                                                                                                                                                      

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|   |                                                                                                                                                                                                                                                         |                                                                                  | 1990.                                                                                                                                                                                                                                                                                                                                                                                    
|-- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | -------------------------------------------------------------------------------- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                                                                                                                                         |                                                                                  |                                                                                                                                                                                                                                                                                                                                                                                          
|   |                                                                                                                                                                                                                                                         | relevant
    year t                                                            | means
        that relevant year for the purposes of which anycalculation
        falls to be made; relevant year t-1 means
        therelevant
        year preceding relevant year t or, in respect of the
        period prior to 1st April 1990, the period of 12 calendar
        months commencing on 1st April 1989; and similar
    expressions shall be construed accordingly.
|   |                                                                                                                                                                                                                                                         |                                                                                  |                                                                                                                                                                                                                                                                                                                                                                                          
|   |                                                                                                                                                                                                                                                         | remote
    transmission asset rental                                           | means
        any rent or other periodic payment payable by thedistribution
        business of the licensee to the transmissioncompany
        in respect of remote transmission assetsforming
    part of the licensees distribution system.                                                                                                                                          
|   |                                                                                                                                                                                                                                                         |                                                                                  |                                                                                                                                                                                                                                                                                                                                                                                          
|   |                                                                                                                                                                                                                                                         | transmission
    connection point charges                                      | means
        charges levied by the transmission company asconnection
        charges by direct reference to the number ornature
        of the connections between the licenseesdistribution
        system and the transmission system andpayable
    by the distribution business of the licensee.                                                                                   
|   |                                                                                                                                                                                                                                                         |                                                                                  |                                                                                                                                                                                                                                                                                                                                                                                          
|   |                                                                                                                                                                                                                                                         | unit                                                                           | means
    a kilowatt hour.                                                                                                                                                                                                                                                                                                                                                               
|   |                                                                                                                                                                                                                                                         |                                                                                  |                                                                                                                                                                                                                                                                                                                                                                                          
|3. | Any
    reference in these Special Conditions to -                                                                                                                                                                                                      |                                                                                 
|   |                                                                                                                                                                                                                                                         |                                                                                  |                                                                                                                                                                                                                                                                                                                                                                                          
|   | (a)                                                                                                                                                                                                                                                     | a provision
    thereof;                                                         |                                                                                                                                                                                                                                                                                                                                                                                          
|   | (b)                                                                                                                                                                                                                                                     | a
    provision of the standard conditions of electricity distribution licences;
|   | (c)                                                                                                                                                                                                                                                     | a
    provision of the standard conditions of electricity supply licences;      
|   | (d)                                                                                                                                                                                                                                                     | a
    provision of the standard conditions of electricity generation licences;  
|   | (e)                                                                                                                                                                                                                                                     | a
    provision of the standard conditions of electricity transmission licences;
|   |                                                                                                                                                                                                                                                         |                                                                                 
|   | shall,
        if these or the standard conditions in question come to be modified,
        be construed, so far as the context permits, as a reference to the corresponding
    provision of these or the standard conditions in question as modified.

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|Special
              Condition B: Restriction of distribution charges -See
    Amendments
|------------------------------------------------------------------------------------------
|                                                                                          
|                                                                                          
|Basic
    Formula                                                                         
|                                                                                          
|1.                                                                                        
|                                                                                          
|                                                                                          
|                                                                                          
|2.                                                                                        
|                                                                                          
|Formula
    for Pdt as used in paragraph 1                                                
|                                                                                          
|3.                                                                                        
|                                                                                          
|                                                                                          
|                                                                                          
|                                                                                          
|                                                                                          
|                                                                                          
|                                                                                          
|                                                                                          
|                                                                                          
|                                                                                          

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| |       | where [S1]                                                                                                                                                                                                                                                                                                                                                                                                                 
| | ----- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |       |                                                                                                                                                                                                                                                                                                                                                                                                                            
| |       | means the
       summation across all regulated distribution unit categories i
       as described in the definition of the term Poi.                                                                                                                                                                                                                                                                                      
| |       |                                                                                                                                                                                                                                                                                                                                                                                                                            
| | Poi   | means, in
       respect of each regulated distribution unit category i set out in column
       1 under that term in the part of Annex
       A to
       this Condition
       which applies to the licensee, the value opposite that category in column
       2.                                                                                                                                                       
| |       |                                                                                                                                                                                                                                                                                                                                                                                                                            
| | Dit   | means that
       number of units in each regulated distribution unit category i distributed
       in relevant year t.                                                                                                                                                                                                                                                                                                    
| |       |                                                                                                                                                                                                                                                                                                                                                                                                                            
| | Dit-1 | means that
       number of units in each regulated distribution unit category i distributed
       in relevant year t-1.                                                                                                                                                                                                                                                                                                  
| |       |                                                                                                                                                                                                                                                                                                                                                                                                                            
| | Cdt   | means a
       notional figure, representing the number of customers in the distribution
       services area (for the purpose of this term Cdt only)
       for each relevant year, given in the table appearing under that term in
       the part of Annex A to this Condition that applies to the licensee.                                                                                                            
| |       |                                                                                                                                                                                                                                                                                                                                                                                                                            
| | Cdt-1 | means the number equal to Cdt in relevant year t-1.                                                                                                                                                                                                                                                                                                                                                                        
| |       |                                                                                                                                                                                                                                                                                                                                                                                                                            
| | PIDt  | in the eleventh
       relevant year has the value of 1 and in each subsequent relevant year
       is derived from the following formula:                                                                                                                                                                                                                                                                                 
| |       |                                                                                                                                                                                                                                                                                                                                                                                                                            
| |       |                                                                                                                                                                                                                                                                                                                                                                                                                            
| |       |                                                                                                                                                                                                                                                                                                                                                                                                                            
| |       | where                                                                                                                                                                                                                                                                                                                                                                                                                      
| |       |                                                                                                                                                                                                                                                                                                                                                                                                                            
| | RPIt  | means the
      percentage change (whether of a positive or a negative value) in the arithmetic
      average of the Retail Price Index numbers published or determined with
      respect to each of the six months July to December (inclusive) in relevant
      year t-1 and the arithmetic average of the Retail Price Index numbers published
    or determined with respect to the same months in relevant year t-2.
| |       |                                                                                                                                                                                                                                                                                                                                                                                                                            
| | Xdt   | shall equal
    3.                                                                                                                                                                                                                                                                                                                                                                                                         
| |       |                                                                                                                                                                                                                                                                                                                                                                                                                            
| | PL    | means
        an amount equal to 2.9p.                                                                                                                                                                                                                                                                                                                                                                                     



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|                                            | ALt                                                                                                                                                                            | means
        an amount (in units) representing allowed distribution losses in relevant
        year t, being the allowed percentage of the adjusted units distributed
        (calculated as provided in paragraph E5 of Part E of Schedule A) where,
        in respect of each relevant year t, the allowed percentage shall equal
        that percentage which the aggregate of adjusted distribution losses (calculated
        as provided in paragraphs E2 to E5 of Part E of Schedule A) over the
        10 preceding relevant years bears to the aggregate of adjusted units
        distributed (calculated as aforesaid) over the corresponding relevant
    years.
|------------------------------------------- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------ | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|                                            |                                                                                                                                                                                |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|                                            | Lt                                                                                                                                                                             | means
        in respect of relevant year t, adjusted grid supply point purchases less
        adjusted units distributed (calculated as provided in paragraphs E2 to
    E5 of Part E of Schedule A).                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|                                            |                                                                                                                                                                                |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|                                            | PILt                                                                                                                                                                           | is
    derived from the following formula:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|                                            |                                                                                                                                                                                |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|                                            |                                                                                                                                                                                |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|                                            |                                                                                                                                                                                |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|                                            |                                                                                                                                                                                | where,
            for the eleventh relevant year, PILt-1 equals
    1.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|                                            |                                                                                                                                                                                |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|                                            | Dt                                                                                                                                                                             | means
    the regulated quantity distributed in relevant year t.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|                                            |                                                                                                                                                                                |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|Formula
    for PNdt as used in paragraph 1
|                                            |                                                                                                                                                                                |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|4.                                          | For
            the purposes of Paragraph 1, in the eleventh and subsequent relevant
    years the term PNdt shall
    be calculated in accordance with the following formula:
|                                            |                                                                                                                                                                                |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|                                            |                                                                                                                                                                                |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|                                            |                                                                                                                                                                                |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|                                            |                                                                                                                                                                                | where:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|                                            |                                                                                                                                                                                |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|                                            | PS                                                                                                                                                                             | means
          an amount equal
to £3.25 million for each of the eleventh to the fifteenth relevant years,
and thereafter shall be 0.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|                                            |                                                                                                                                                                                |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|                                            | PR                                                                                                                                                                             | means,
          in the eleventh and all subsequent relevant years, the amount given
          against the licensees
name in Annex B to this Condition.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|                                            |                                                                                                                                                                                |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|                                            | PIRt                                                                                                                                                                           | is
    derived from the following formula:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      

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|                                                    |                                                                                                                                                                                                                                                                                                                                                                                    |        |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |                                                               
|--------------------------------------------------- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ------ | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | --------------------------------------------------------------
|                                                    |                                                                                                                                                                                                                                                                                                                                                                                    |        |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |                                                               
|                                                    |                                                                                                                                                                                                                                                                                                                                                                                    |        |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     | where
          for the ninth relevant year PIRt-1equals
    1
|                                                    |                                                                                                                                                                                                                                                                                                                                                                                    |        |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |                                                               
|Formula
          forPMdt as
    used in Paragraph1
|                                                    |                                                                                                                                                                                                                                                                                                                                                                                    |        |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |                                                               
|5.                                                  | For
        the purposes of paragraph 1, PMdt is derived from the following
    formula:                                                                                                                                                                                                                                                                                          
|                                                    |                                                                                                                                                                                                                                                                                                                                                                                    |        |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |                                                               
|                                                    |                                                                                                                                                                                                                                                                                                                                                                                    |        |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |                                                               
|                                                    |                                                                                                                                                                                                                                                                                                                                                                                    |        |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |                                                               
|                                                    |                                                                                                                                                                                                                                                                                                                                                                                    | where: |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |                                                               
|                                                    |                                                                                                                                                                                                                                                                                                                                                                                    |        |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |                                                               
|                                                    | RMdt                                                                                                                                                                                                                                                                                                                                                                               |        | means
        an amount equal to the licensees relevant reduction in costs in
        relevant year t, resulting from the fact that the licensee has ceased
        to provide meter provision services and meter operation services (as
        defined in paragraph 1 of standard condition 36B (Requirement to Offer
        Terms for the Provision of Distributor Metering and Data Services)) in
        respect of customers in respect of whom it provided meter provision services
        and meter operation services at 31 March 2000. The licensees relevant
        reduction in costs shall be calculated in real terms, and shall be the
        amount, if any, by which the licensees cash operating costs (excluding
        costs of a non-recurring nature) of providing such services in the relevant
        year t fall short of its cash operating costs (excluding costs of a non-recurring
        nature) of providing such services in the tenth relevant year, to the
        extent that such shortfall is attributable to the fact that the licensee
        has ceased, since 31 March 2000, to provide (whether directly or through
        an agent acting on its behalf) meter provision services and meter operation
        services in respect of such customers. The licensees relevant reduction
        in costs shall exclude the amount of any reduction in costs in providing
    any services which constitute excluded services.
|                                                    |                                                                                                                                                                                                                                                                                                                                                                                    |        |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |                                                               
|Formula
          forKdt as
    used in Paragraph1 
|                                                    |                                                                                                                                                                                                                                                                                                                                                                                    |        |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |                                                               
|6.                                                  | For
          the purposes
of paragraph 1, Kdt means the correction factor per unit (whether
of apositive
or a negative value) derived, subject to paragraph 3 of Special Condition C (Restriction
of distribution charges: adjustments), from the following formula: provided thatthe
value of Kdt for the eleventh relevant year shall be the value of
Kdt arising for that year



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| | from
        the application of the formula applicable under Licence Condition 3A
        of the Public Electricity Supply licence previously granted to NORWEB
        plc in the form of that condition in
        force on 31 March 2000, but adjusted by adding the amount of TAdt for
        the tenth relevantyear,
        calculated by the application of the formula applicable under Licence
    Condition 3A of that Public Electricity Supply licence as then in force:
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
| | where:                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
| | Rdt-1                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
| | Dt-1                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
| | Mdt-1                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
| | Idt                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  



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MODIFICATION TO THE ELECTRICITY DISTRIBUTION LICENCE ISSUED TO LICENCE HOLDERS HAVING A DISTRIBUTION SERVICES AREA SITUATED IN ENGLAND AND WALES.

SCHEDULE

|1. | Paragraph
        1 of special condition B (Restriction of distribution charges) shall
    be amended to read as follows:                                  
|-- | -----------------------------------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                                            
|   |                                                                                                                                                            
|   |                                                                                                                                                            
|   |                                                                                                                                                            
|   |                                                                                                                                                            
|2. | In special
        condition B (Restriction of distribution charges), the following new
    paragraph 7 shall be inserted after paragraph 6:               
|   |                                                                                                                                                            
|   |                                                                                                                                                            
|   |                                                                                                                                                            
|   |                                                                                                                                                            
|   |                                                                                                                                                            
|   |                                                                                                                                                            
|   |                                                                                                                                                            
|   |                                                                                                                                                            
|   |                                                                                                                                                            
|   |                                                                                                                                                            
|   |                                                                                                                                                            
|   |                                                                                                                                                            
|   |                                                                                                                                                            
|   |                                                                                                                                                            
|  
|1  | These
        terms will only be included if the proposed modification in respect of
        the incentive scheme
has been made or is made on the same day.



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|   |                                                                                                                                                                                                                                            | LAdt=PFt.PIFdt                                                                                                                                                                           
|-- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------ | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                                                                                                                            |                                                                                                                                                                                          
|   | PFt                                                                                                                                                                                                                                        | means,
      in respect of each relevant year, the amount given in the table appearing
      under that term in the part of Annex C to this Condition that applies to
      the licensee.
|   |                                                                                                                                                                                                                                            |                                                                                                                                                                                          
|   | PIFt                                                                                                                                                                                                                                       | is derived
      from the following formula:                                                                                                                                             
|   |                                                                                                                                                                                                                                            |                                                                                                                                                                                          
|   |                                                                                                                                                                                                                                            |                                                                                                                                                                                          
|   |                                                                                                                                                                                                                                            |                                                                                                                                                                                          
|   |                                                                                                                                                                                                                                            | where
      for the ninth relevant year PIFt-1equals 1.                                                                                                                                  
|   |                                                                                                                                                                                                                                            |                                                                                                                                                                                          
|3. | The
      attached table entitled Annex C to special condition B (Restriction
      of distribution charges) shall be inserted after Annex B to special
      condition B (Restriction of distribution charges).                        
|   |                                                                                                                                                                                                                                            |                                                                                                                                                                                          
|4. | In
      paragraph 9 of special condition D (Information to be provided to the Authority
      in connection with the charge restriction conditions), the following new
      sub-paragraph (h) shall be inserted after sub-paragraph (g):
|   |                                                                                                                                                                                                                                            |                                                                                                                                                                                          
|   | (h)
      the value of the term LFdttogether with the value of each of its component parts, as detailed in paragraph
      7 of special condition B (Restriction of distribution charges)                                                 



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MODIFICATION TO THE ELECTRICITY DISTRIBUTION LICENCE ISSUED TO LICENCE HOLDERS HAVING A DISTRIBUTION SERVICES AREA SITUATED IN ENGLAND AND WALES.

SCHEDULE

|1. |    | Delete
      paragraph 6 of Special Condition B (Restriction of Distribution Charges)
      and replace with:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|-- | -- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|   | 6. | For
      the purpose of paragraph 1, Kdtshall
      mean the correction factor per unit (whether of a positive or negative value)
      derived, subject to paragraph 3 of Special Condition C (Restriction of distribution
      charges: adjustments), from the following formula: provided that the value
      of Kdfor
      the eleventh relevant year shall be the value of Kdtarising
      for that year from the application of the formula applicable under Licence
      Condition 3A of the Public Electricity Supply licence of the predecessor
      company in the form of that condition in force on 31 March 2000, but adjusted
      by adding the amount of TAdtfor
      the tenth relevant year, calculated by the application of the formula applicable
      under Licence Condition 3A of that Public Electricity Supply licence as
      then in force:
|   |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|   |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|   |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|   |    | where:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|   |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|   |    | Rdt-1                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|   |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|   |    | Dt-1                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|   |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|   |    | Mdt-1                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|   |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|   |    | Idt                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|   |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|   |    | RAdt-1                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|   |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|   |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|   |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|   |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   



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|   |                                                                                                                                                                                                                    |  | DAdt | means an
      amount given in the table appearing under that term in the part of Annex
      D to this Condition that applies to the licensee. 
|-- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------ |  | ---- | ------------------------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                                                                                                    |  |      |                                                                                                                                                 
|   |                                                                                                                                                                                                                    |  | PBdt | means
      the amount given in the table appearing under that term in the part of Annex
      D to this Condition that applies to the licensee.
|   |                                                                                                                                                                                                                    |  |      |                                                                                                                                                 
|   |                                                                                                                                                                                                                    | 
|2. | The
      attached table entitled Annex D to Special Condition B (Restriction
      of distribution charges) shall be inserted after Annex C to Special
      Condition B (Restriction of distribution charges).



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ANNEX A to Special Condition B (Restriction of distribution charges)

EASTERN ELECTRICITY LIMITED

|    |                                         |              |           | £m     | 
|--- | --------------------------------------- | ------------ | --------- | ------ | 
|    |                                         |              |           |        | 
|    | PUM                                     |              | 287.9     |       
|    |                                         |              |           |        | 
|    | Cdt for relevant year beginning on      |              |           |       
|    |                                         |              |           |        | 
|    |                                         |              |           | 000s  | 
|    |                                         |              |           |        | 
|    |                                         | 1 April 2000 |           | 3249   | 
|    |                                         |              |           |        | 
|    |                                         | 1 April 2001 |           | 3281   | 
|    |                                         |              |           |        | 
|    |                                         | 1 April 2002 |           | 3314   | 
|    |                                         |              |           |        | 
|    |                                         | 1 April 2003 |           | 3347   | 
|    |                                         |              |           |        | 
|    |                                         | 1 April 2004 |           | 3381   | 
|    |                                         |              |           |        | 
|    | every
    subsequent relevant year 3415 |              |           |       
|    |                                         |              |           |        | 
|    |                                         |              |           |        | 
|P0i |                                         |              |           |        | 
|    |                                         |              |           |        | 
|    | Column 1                                |              | Column 2  |       
|    |                                         |              |           |        | 
|    | unit
    category i                     |              | value (p) |       
|    |                                         |              |           |        | 
|    |                                         | LV1          |           | 2.0009 | 
|    |                                         |              |           |        | 
|    |                                         | LV2          |           | 0.3031 | 
|    |                                         |              |           |        | 
|    |                                         | LV3          |           | 1.3431 | 
|    |                                         |              |           |        | 
|    |                                         | HV           |           | 0.4584 | 

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EAST MIDLANDS ELECTRICITY DISTRIBUTION PLC

| |                                         |              |           | £m     | 
| | --------------------------------------- | ------------ | --------- | ------ | 
| |                                         |              |           |        | 
| | PUM                                     |              | 240.3     |       
| |                                         |              |           |        | 
| | Cdt for relevant year beginning on      |              |           |       
| |                                         |              |           |        | 
| |                                         |              |           | 000s  | 
| |                                         |              |           |        | 
| |                                         | 1 April 2000 |           | 2376   | 
| |                                         |              |           |        | 
| |                                         | 1 April 2001 |           | 2400   | 
| |                                         |              |           |        | 
| |                                         | 1 April 2002 |           | 2424   | 
| |                                         |              |           |        | 
| |                                         | 1 April 2003 |           | 2448   | 
| |                                         |              |           |        | 
| |                                         | 1 April 2004 |           | 2472   | 
| |                                         |              |           |        | 
| | every
    subsequent relevant year 2497 |              |           |       
| |                                         |              |           |        | 
| |                                         |              |           |        | 
| | P0i                                     |              |           |        | 
| |                                         |              |           |        | 
| | Column 1                                |              | Column 2  |       
| |                                         |              |           |        | 
| | unit
    category i                     |              | value (p) |       
| |                                         |              |           |        | 
| |                                         | LV1          |           | 1.6131 | 
| |                                         |              |           |        | 
| |                                         | LV2          |           | 0.5557 | 
| |                                         |              |           |        | 
| |                                         | LV3          |           | 1.5711 | 
| |                                         |              |           |        | 
| |                                         | HV           |           | 0.6350 | 

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LONDON POWER NETWORKS PLC

| |                                    |                                            |           | £m     | 
| | ---------------------------------- | ------------------------------------------ | --------- | ------ | 
| |                                    |                                            |           |        | 
| |                                    | PUM                                        |           | 220.8  | 
| |                                    |                                            |           |        | 
| | Cdt for relevant year beginning on |                                            |           |       
| |                                    |                                            |           |        | 
| |                                    |                                            |           | 000s  | 
| |                                    |                                            |           |        | 
| |                                    | 1
    April 2000                           |           | 2072   | 
| |                                    |                                            |           |        | 
| |                                    | 1
    April 2001                           |           | 2093   | 
| |                                    |                                            |           |        | 
| |                                    | 1
    April 2002                           |           | 2114   | 
| |                                    |                                            |           |        | 
| |                                    | 1
    April 2003                           |           | 2135   | 
| |                                    |                                            |           |        | 
| |                                    | 1
    April 2004                           |           | 2156   | 
| |                                    |                                            |           |        | 
| |                                    | every
       subsequent relevant year 2178 |           |        | 
| |                                    |                                            |           |        | 
| | P0i                                |                                            |           |       
| |                                    |                                            |           |        | 
| | Column
    1                       |                                            | Column 2  |       
| |                                    |                                            |           |        | 
| | unit category i                    |                                            | value (p) |       
| |                                    |                                            |           |        | 
| |                                    | LV1                                        |           | 2.2073 | 
| |                                    |                                            |           |        | 
| |                                    | LV2                                        |           | 0.4057 | 
| |                                    |                                            |           |        | 
| |                                    | LV3                                        |           | 1.5912 | 
| |                                    |                                            |           |        | 
| |                                    | HV                                         |           | 0.5932 | 

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MANWEB PLC

|    |                                           | £m              | 
|--- | ----------------------------------------- | --------------- | 
|    |                                           |                 | 
|    | PUM                                       | 158.0           | 
|    |                                           |                 | 
|    |                                           |                 | 
|    | Cdtfor relevant
      year beginning on   |                 | 
|    |                                           |                 | 
|    |                                           | 000s           | 
|    |                                           |                 | 
|    | 1
      April 2000                        | 1423            | 
|    |                                           |                 | 
|    | 1
      April 2001                        | 1437            | 
|    |                                           |                 | 
|    | 1
      April 2002                        | 1452            | 
|    |                                           |                 | 
|    | 1
      April 2003                        | 1466            | 
|    |                                           |                 | 
|    | 1
      April 2004                        | 1481            | 
|    |                                           |                 | 
|    | every subsequent
      relevant year 1496 |                 | 
|    |                                           |                 | 
|P0i |                                           |                 | 
|    | Column 1                                  | Column 2        | 
|    |                                           |                 | 
|    | unit
      category i                     | value
      (p) | 
|    |                                           |                 | 
|    | LV1                                       | 2.1041          | 
|    |                                           |                 | 
|    | LV2                                       | 0.4323          | 
|    |                                           |                 | 
|    | LV3                                       | 1.7558          | 
|    |                                           |                 | 
|    | HV                                        | 0.5097          | 

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GPU POWER NETWORKS (UK) PLC

|    |                                           | £m              | 
|--- | ----------------------------------------- | --------------- | 
|    |                                           |                 | 
|    | PUM                                       | 243.5           | 
|    |                                           |                 | 
|    |                                           |                 | 
|    | Cdtfor relevant
      year beginning on   |                 | 
|    |                                           |                 | 
|    |                                           | 000s           | 
|    |                                           |                 | 
|    | 1
      April 2000                        | 2303            | 
|    |                                           |                 | 
|    | 1
      April 2001                        | 2326            | 
|    |                                           |                 | 
|    | 1
      April 2002                        | 2349            | 
|    |                                           |                 | 
|    | 1
      April 2003                        | 2373            | 
|    |                                           |                 | 
|    | 1
      April 2004                        | 2397            | 
|    |                                           |                 | 
|    | every subsequent
      relevant year 2420 |                 | 
|    |                                           |                 | 
|P0i |                                           |                 | 
|    | Column 1                                  | Column 2        | 
|    |                                           |                 | 
|    | unit
      category i                     | value
      (p) | 
|    |                                           |                 | 
|    | LV1                                       | 1.9729          | 
|    |                                           |                 | 
|    | LV2                                       | 0.3966          | 
|    |                                           |                 | 
|    | LV3                                       | 1.6108          | 
|    |                                           |                 | 
|    | HV                                        | 0.5992          | 

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NORTHERN ELECTRIC DISTRIBUTION LIMITED

|    |                                           | £m              | 
|--- | ----------------------------------------- | --------------- | 
|    |                                           |                 | 
|    | PUM                                       | 152.6           | 
|    |                                           |                 | 
|    |                                           |                 | 
|    | Cdtfor relevant
      year beginning on   |                 | 
|    |                                           |                 | 
|    |                                           | 000s           | 
|    |                                           |                 | 
|    | 1
      April 2000                        | 1500            | 
|    |                                           |                 | 
|    | 1
      April 2001                        | 1515            | 
|    |                                           |                 | 
|    | 1
      April 2002                        | 1530            | 
|    |                                           |                 | 
|    | 1
      April 2003                        | 1545            | 
|    |                                           |                 | 
|    | 1
      April 2004                        | 1561            | 
|    |                                           |                 | 
|    | every subsequent
      relevant year 1577 |                 | 
|    |                                           |                 | 
|P0i |                                           |                 | 
|    | Column 1                                  | Column 2        | 
|    |                                           |                 | 
|    | unit
      category i                     | value
      (p) | 
|    |                                           |                 | 
|    | LV1                                       | 2.0911          | 
|    |                                           |                 | 
|    | LV2                                       | 0.3273          | 
|    |                                           |                 | 
|    | LV3                                       | 1.9284          | 
|    |                                           |                 | 
|    | HV                                        | 0.4723          | 

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|NORWEB
    plc |                                         |             
|-------------- | --------------------------------------- | ------------
|               |                                         |             
|               |                                         |             
|               |                                         |             
|               | PUM                                     | 208.9       
|               |                                         |             
|               |                                         |             
|               | Cdtfor relevant year beginning on       |             
|               |                                         |             
|               |                                         |             
|               |                                         | 1 April 2000
|               |                                         |             
|               |                                         | 1 April 2001
|               |                                         |             
|               |                                         | 1 April 2002
|               |                                         |             
|               |                                         | 1 April 2003
|               |                                         |             
|               |                                         | 1 April 2004
|               |                                         |             
|               | every subsequent
    relevant year 2365 |             
|               |                                         |             
|               |                                         |             
|               |                                         |             
|P0i            |                                         |             
|               |                                         |             
|               | Column 1                                | Column 2    
|               |                                         |             
|               | unit category i                         | value (p)   
|               |                                         |             
|               |                                         | LV1         
|               |                                         |             
|               |                                         | LV2         
|               |                                         |             
|               |                                         | LV3         
|               |                                         |             
|               |                                         | HV          

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|SEEBOARD
    POWER NETWORKS PLC |                                            |             
|------------------------------- | ------------------------------------------ | ------------
|                                |                                            |             
|                                |                                            |             
|                                |                                            |             
|                                | PUM                                        | 159.1       
|                                |                                            |             
|                                |                                            |             
|                                | Cdtfor relevant year beginning on          |             
|                                |                                            |             
|                                |                                            |             
|                                |                                            |             
|                                |                                            | 1 April 2000
|                                |                                            |             
|                                |                                            | 1 April 2001
|                                |                                            |             
|                                |                                            | 1 April 2002
|                                |                                            |             
|                                |                                            | 1 April 2003
|                                |                                            |             
|                                |                                            | 1 April 2004
|                                |                                            |             
|                                | every
       subsequent relevant year 2263 |             
|                                |                                            |             
|                                |                                            |             
|                                |                                            |             
|P0i                             |                                            |             
|                                |                                            |             
|                                | Column 1                                   | Column 2    
|                                |                                            |             
|                                | unit
       category i                     | value (p)   
|                                |                                            |             
|                                |                                            | LV1         
|                                |                                            |             
|                                |                                            | LV2         
|                                |                                            |             
|                                |                                            | LV3         
|                                |                                            |             
|                                |                                            | HV          

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|SOUTHERN
    ELECTRIC POWER DISTRIBUTION PLC
|--------------------------------------------
|                                            
|                                            
|                                            
|                                            
|                                            
|                                            
|                                            
|                                            
|                                            
|                                            
|                                            
|                                            
|                                            
|                                            
|                                            
|                                            
|                                            
|                                            
|                                            
|                                            
|                                            
|                                            
|                                            
|P0i                                         
|                                            
|                                            
|                                            
|                                            
|                                            
|                                            
|                                            
|                                            
|                                            
|                                            
|                                            
|                                            

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WESTERN POWER DISTRIBUTION (SOUTH WALES) PLC

|    |                |                                         |               | £m     | 
|--- | -------------- | --------------------------------------- | ------------- | ------ | 
|    |                |                                         |               |        | 
|    |                | PUM                                     |               | 125.6  | 
|    |                |                                         |               |        | 
|    |                |                                         |               |        | 
|    |                |                                         |               |        | 
|    |                | Cdt for relevant year beginning on      |               |        | 
|    |                |                                         |               |        | 
|    |                |                                         |               | 000s  | 
|    |                |                                         |               |        | 
|    |                |                                         |               |        | 
|    |                | 1 April 2000                            |               | 998    | 
|    |                |                                         |               |        | 
|    |                | 1 April 2001                            |               | 1008   | 
|    |                |                                         |               |        | 
|    |                | 1 April 2002                            |               | 1018   | 
|    |                |                                         |               |        | 
|    |                | 1 April 2003                            |               | 1028   | 
|    |                |                                         |               |        | 
|    |                | 1 April 2004                            |               | 1039   | 
|    |                |                                         |               |        | 
|    |                | every subsequent
    relevant year 1049 |               |        | 
|    |                |                                         |               |        | 
|    |                |                                         |               |        | 
|    |                |                                         |               |        | 
|P0i |                |                                         |               |       
|    |                |                                         |               |        | 
|    | Column 1       |                                         | Column 2      |       
|    |                |                                         |               |        | 
|    | unit categoryi |                                         | value
    (p) |       
|    |                |                                         |               |        | 
|    |                | LV1                                     |               | 2.4442 | 
|    |                |                                         |               |        | 
|    |                | LV2                                     |               | 0.3641 | 
|    |                |                                         |               |        | 
|    |                | LV3                                     |               | 2.2009 | 
|    |                |                                         |               |        | 
|    |                | HV                                      |               | 0.7272 | 

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WESTERN POWER DISTRIBUTION (SOUTH WEST) PLC

|    |                    |                                             |                   | £m     | 
|--- | ------------------ | ------------------------------------------- | ----------------- | ------ | 
|    |                    |                                             |                   |        | 
|    |                    | PUM                                         |                   | 171.0  | 
|    |                    |                                             |                   |        | 
|    |                    |                                             |                   |        | 
|    |                    | Cdt for
        relevant year beginning on  |                   |        | 
|    |                    |                                             |                   |        | 
|    |                    |                                             |                   | 000s  | 
|    |                    |                                             |                   |        | 
|    |                    |                                             |                   |        | 
|    |                    | 1
        April 2000                        |                   | 1369   | 
|    |                    |                                             |                   |        | 
|    |                    | 1
        April 2001                        |                   | 1383   | 
|    |                    |                                             |                   |        | 
|    |                    | 1
        April 2002                        |                   | 1397   | 
|    |                    |                                             |                   |        | 
|    |                    | 1
        April 2003                        |                   | 1410   | 
|    |                    |                                             |                   |        | 
|    |                    | 1
        April 2004                        |                   | 1425   | 
|    |                    |                                             |                   |        | 
|    |                    | every
        subsequent relevant year 1439 |                   |        | 
|    |                    |                                             |                   |        | 
|    |                    |                                             |                   |        | 
|    |                    |                                             |                   |        | 
|P0i |                    |                                             |                   |       
|    |                    |                                             |                   |        | 
|    | Column
    1       |                                             | Column
        2  |       
|    |                    |                                             |                   |        | 
|    | unit
    categoryi |                                             | value
        (p) |       
|    |                    |                                             |                   |        | 
|    |                    | LV1                                         |                   | 2.3889 | 
|    |                    |                                             |                   |        | 
|    |                    | LV2                                         |                   | 0.6679 | 
|    |                    |                                             |                   |        | 
|    |                    | LV3                                         |                   | 1.8707 | 
|    |                    |                                             |                   |        | 
|    |                    | HV                                          |                   | 0.5072 | 

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YORKSHIRE ELECTRICITY DISTRIBUTION PLC

|    |                    |                                             |                     | £m     | 
|--- | ------------------ | ------------------------------------------- | ------------------- | ------ | 
|    |                    |                                             |                     |        | 
|    |                    | PUM                                         |                     | 215.4  | 
|    |                    |                                             |                     |        | 
|    |                    |                                             |                     |        | 
|    |                    |                                             |                     |        | 
|    |                    | Cdt for
        relevant year beginning on  |                     |        | 
|    |                    |                                             |                     |        | 
|    |                    |                                             |                     | 000s  | 
|    |                    |                                             |                     |        | 
|    |                    |                                             |                     |        | 
|    |                    | 1
        April 2000                        |                     | 2129   | 
|    |                    |                                             |                     |        | 
|    |                    | 1
        April 2001                        |                     | 2150   | 
|    |                    |                                             |                     |        | 
|    |                    | 1
        April 2002                        |                     | 2172   | 
|    |                    |                                             |                     |        | 
|    |                    | 1
        April 2003                        |                     | 2194   | 
|    |                    |                                             |                     |        | 
|    |                    | 1
        April 2004                        |                     | 2215   | 
|    |                    |                                             |                     |        | 
|    |                    | every
        subsequent relevant year 2238 |                     |        | 
|    |                    |                                             |                     |        | 
|    |                    |                                             |                     |        | 
|    |                    |                                             |                     |        | 
|P0i |                    |                                             |                     |       
|    |                    |                                             |                     |        | 
|    | Column
    1       |                                             | Column
        2    |       
|    |                    |                                             |                     |        | 
|    | unit
    categoryi |                                             | value
          (p) |       
|    |                    |                                             |                     |        | 
|    |                    | LV1                                         |                     | 1.9497 | 
|    |                    |                                             |                     |        | 
|    |                    | LV2                                         |                     | 0.3271 | 
|    |                    |                                             |                     |        | 
|    |                    | LV3                                         |                     | 1.6654 | 
|    |                    |                                             |                     |        | 
|    |                    | HV                                          |                     | 0.5750 | 

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ANNEX B to Special Condition B (Restriction of distribution charges)



| |                                                           |    |      | 
| | --------------------------------------------------------- | -- | ---- | 
| |                                                           | PR | £M   | 
| |                                                           |    |      | 
| | EASTERN ELECTRICITY LIMITED                               |    | 2.97 | 
| |                                                           |    |      | 
| | EAST MIDLANDS
       ELECTRICITY DISTRIBUTION PLC         |    | 2.35 | 
| |                                                           |    |      | 
| | GPU POWER
    NETWORKS (UK) PLC                           |    | 2.34 | 
| |                                                           |    |      | 
| | LONDON POWER NETWORKS PLC                                 |    | 2.14 | 
| |                                                           |    |      | 
| | MANWEB PLC                                                |    | 1.69 | 
| |                                                           |    |      | 
| | NORTHERN
    ELECTRICITY DISTRIBUTION PLC                 |    | 1.76 | 
| |                                                           |    |      | 
| | NORWEB PLC                                                |    | 2.28 | 
| |                                                           |    |      | 
| | SCOTTISH
       HYDRO-ELECTRIC POWER DISTRIBUTION LIMITED |    | 1.16 | 
| |                                                           |    |      | 
| | SP DISTRIBUTION LIMITED                                   |    | 2.01 | 
| |                                                           |    |      | 
| | SEEBOARD POWER NETWORKS PLC                               |    | 2.15 | 
| |                                                           |    |      | 
| | SOUTHERN
       ELECTRIC POWER DISTRIBUTION PLC           |    | 2.64 | 
| |                                                           |    |      | 
| | WESTERN
    POWER DISTRIBUTION (SOUTH WALES) PLC          |    | 1.38 | 
| |                                                           |    |      | 
| | WESTERN
    POWER DISTRIBUTION (SOUTH WEST) PLC           |    | 1.65 | 
| |                                                           |    |      | 
| | YORKSHIRE
    ELECTRICITY DISTRIBUTION PLC                |    | 2.19 | 
| |                                                           |    |      | 

27

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ANNEX C TO SPECIAL CONDITION B (RESTRICTION OF DISTRIBUTION CHARGES)

EPN DISTRIBUTION LIMITED (FORMERLY EASTERN ELECTRICITY LIMITED)



|PFt                                                         |                
|----------------------------------------------------------- | ---------------
|                                                            |                
|2000/01                                                     | £0.731 millions
|2001/02                                                     | £0.731 millions
|                                                            |                
|subsequent relevant years                                   | £0.731 millions
|                                                            |                
|EAST
         MIDLANDSELECTRICITY
         DISTRIBUTION PLC
|                                                            |                
|PFt                                                         |                
|                                                            |                
|2000/01                                                     | £0.532 millions
|2001/02                                                     | £0.517 millions
|                                                            |                
|subsequent relevant years                                   | £0.517 millions
|                                                            |                
|LONDON
         POWERNETWORKS
         PLC                 
|                                                            |                
|PFt                                                         |                
|                                                            |                
|2000/01                                                     | £0.461 millions
|2001/02                                                     | £0.451 millions
|                                                            |                
|subsequent relevant years                                   | £0.451 millions
|                                                            |                
|SP MANWEB PLC                                               |                
|                                                            |                
|PFt                                                         |                
|                                                            |                
|2000/01                                                     | £0.423 millions
|2001/02                                                     | £0.414 millions
|                                                            |                
|subsequent relevant years                                   | £0.414 millions
|                                                            |                
|GPU
         POWER NETWORKS(UK)
         PLC               
|                                                            |                
|PFt                                                         |                
|                                                            |                
|2000/01                                                     | £0.511 millions
|2001/02                                                     | £0.492 millions
|                                                            |                
|subsequent relevant years                                   | £0.492 millions

---



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|NORTHERN
         ELECTRICDISTRIBUTION
         LIMITED                
|-----------------------------------------------------------------------
|                                                                       
|PFt                                                                    
|                                                                       
|2000/01                                                                
|2001/02                                                                
|                                                                       
|subsequent relevant years                                              
|                                                                       
|UNITED
         UTILITIESELECTRICITY
         PLC (FORMERLY NORWEB PLC)
|                                                                       
|PFt                                                                    
|                                                                       
|2000/01                                                                
|2001/02                                                                
|                                                                       
|subsequent relevant years                                              
|                                                                       
|SEEBOARD
         POWERNETWORKS
         PLC                           
|                                                                       
|PFt                                                                    
|                                                                       
|2000/01                                                                
|2001/02                                                                
|                                                                       
|subsequent relevant years                                              
|                                                                       
|SOUTHERN
         ELECTRICPOWER
         DISTRIBUTION PLC              
|                                                                       
|PFt                                                                    
|                                                                       
|2000/01                                                                
|2001/02                                                                
|                                                                       
|subsequent relevant years                                              
|                                                                       
|WESTERN
         POWERDISTRIBUTION
         (SOUTH WALES) PLC          
|                                                                       
|PFt                                                                    
|                                                                       
|2000/01                                                                
|2001/02                                                                
|                                                                       
|subsequent relevant years                                              

---



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|                                                |                     | 
|----------------------------------------------- | ------------------- | 
|WESTERN
    POWER DISTRIBUTION (SOUTH WEST) PLC
|                                                |                     | 
|PFt                                             |                     | 
|                                                |                     | 
|2000/01                                         | £0.288
    millions | 
|2001/02                                         | £0.279
    millions | 
|                                                |                     | 
|subsequent
    relevant years                   | £0.279
    millions | 
|                                                |                     | 
|YORKSHIRE
    ELECTRICITY DISTRIBUTION PLC     
|                                                |                     | 
|PFt                                             |                     | 
|                                                |                     | 
|2000/01                                         | £0.474
    millions | 
|2001/02                                         | £0.458
    millions | 
|                                                |                     | 
|subsequent
    relevant years                   | £0.458
    millions | 

---



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|                                                                         |                    | 
|------------------------------------------------------------------------ | ------------------ | 
|ANNEX
    D TO SPECIAL CONDITION B (RESTRICTION OF DISTRIBUTION CHARGES)
|                                                                         |                    | 
|EPN
    DISTRIBUTION LIMITED (FORMERLY EASTERN ELECTRICITY LIMITED)     
|                                                                         |                    | 
|DAdt                                                                     |                    | 
|                                                                         |                    | 
|2000/01                                                                  | 0.8                | 
|                                                                         |                    | 
|Thereafter                                                               | 0.0                | 
|                                                                         |                    | 
|PBdt                                                                     |                    | 
|                                                                         |                    | 
|2000/01                                                                  | £1.474
    million | 
|                                                                         |                    | 
|Thereafter                                                               | 0                  | 
|                                                                         |                    | 
|EAST
    MIDLANDS ELECTRICITY DISTRIBUTION PLC                          
|                                                                         |                    | 
|DAdt                                                                     |                    | 
|                                                                         |                    | 
|2000/01                                                                  | 0.8                | 
|                                                                         |                    | 
|Thereafter                                                               | 0.0                | 
|                                                                         |                    | 
|PBdt                                                                     |                    | 
|                                                                         |                    | 
|2000/01                                                                  | £1.987
    million | 
|                                                                         |                    | 
|Thereafter                                                               | 0                  | 
|                                                                         |                    | 
|LONDON
    POWER NETWORKS LIMITED                                       
|                                                                         |                    | 
|DAdt                                                                     |                    | 
|                                                                         |                    | 
|2000/01                                                                  | 0.9                | 
|                                                                         |                    | 
|Thereafter                                                               | 0.0                | 
|                                                                         |                    | 
|PBdt                                                                     |                    | 
|                                                                         |                    | 
|2000/01                                                                  | £0.123
    million | 
|                                                                         |                    | 
|Thereafter                                                               | 0                  | 

---



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|                                           |                    | 
|------------------------------------------ | ------------------ | 
|SP
    MANWEB PLC                          |                    | 
|                                           |                    | 
|DAdt                                       |                    | 
|                                           |                    | 
|2000/01                                    | 0.8                | 
|                                           |                    | 
|Thereafter                                 | 0.0                | 
|                                           |                    | 
|PBdt                                       |                    | 
|                                           |                    | 
|2000/01                                    | £1.688
    million | 
|                                           |                    | 
|Thereafter                                 | 0                  | 
|                                           |                    | 
|GPU
    POWER NETWORKS (UK) PLC            |                    | 
|                                           |                    | 
|DAdt                                       |                    | 
|                                           |                    | 
|2000/01                                    | 0.8                | 
|                                           |                    | 
|Thereafter                                 | 0.0                | 
|                                           |                    | 
|PBdt                                       |                    | 
|                                           |                    | 
|2000/01                                    | £2.705
    million | 
|                                           |                    | 
|Thereafter                                 | 0                  | 
|                                           |                    | 
|NORTHERN
    ELECTRIC DISTRIBUTION LIMITED
|                                           |                    | 
|DAdt                                       |                    | 
|                                           |                    | 
|2000/01                                    | 0.8                | 
|                                           |                    | 
|Thereafter                                 | 0.0                | 
|                                           |                    | 
|PBdt                                       |                    | 
|                                           |                    | 
|2000/01                                    | £0.998
    million | 
|                                           |                    | 
|Thereafter                                 | 0                  | 

---



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|UNITED
      UTILITIES ELECTRICITY PLC (FORMERLY NORWEB PLC)
|------------------------------------------------------------
|                                                            
|DAdt                                                        
|                                                            
|2000/01                                                     
|                                                            
|Thereafter                                                  
|                                                            
|PBdt                                                        
|                                                            
|2000/01                                                     
|                                                            
|Thereafter                                                  
|                                                            
|SEEBOARD
      POWER NETWORKS PLC                           
|                                                            
|DAdt                                                        
|                                                            
|2000/01                                                     
|                                                            
|Thereafter                                                  
|                                                            
|PBdt                                                        
|                                                            
|2000/01                                                     
|                                                            
|Thereafter                                                  
|                                                            
|SOUTHERN
      ELECTRIC POWER DISTRIBUTION PLC              
|                                                            
|DAdt                                                        
|                                                            
|2000/01                                                     
|                                                            
|Thereafter                                                  
|                                                            
|PBdt                                                        
|                                                            
|2000/01                                                     
|                                                            
|Thereafter                                                  
|                                                            

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|WESTERN
      POWER DISTRIBUTION (SOUTH WALES) PLC
|--------------------------------------------------
|                                                  
|DAdt                                              
|                                                  
|2000/01                                           
|                                                  
|Thereafter                                        
|                                                  
|PBdt                                              
|                                                  
|2000/01                                           
|                                                  
|Thereafter                                        
|                                                  
|WESTERN
      POWER DISTRIBUTION (SOUTH WEST) PLC 
|                                                  
|DAdt                                              
|                                                  
|2000/01                                           
|                                                  
|Thereafter                                        
|                                                  
|PBdt                                              
|                                                  
|2000/01                                           
|                                                  
|Thereafter                                        
|                                                  
|YORKSHIRE
      ELECTRICITY DISTRIBUTION PLC      
|                                                  
|DAdt                                              
|                                                  
|2000/01                                           
|                                                  
|Thereafter                                        
|                                                  
|PBdt                                              
|                                                  
|2000/01                                           
|                                                  
|Thereafter                                        

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Special
  Condition C: Restriction of distribution charges: adjustments

|1. | If, in
      respect of any relevant year, the average charge per unit distributed exceeds
      the maximum average charge per unit distributed by more than 3 per cent,the
      licensee shall furnish an explanation to the Authority and in the next following
      relevant year the licensee shall not effect any increase in charges unless
      it has demonstrated to the reasonable satisfaction of the Authority that
      the average charge per unit distributedwould
      not be likely to exceed the maximum charge per unit distributed in that
      next following relevant year.                                                                                         
|-- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|2. | If, in respect
      of any two successive relevant years, the sum of the amounts by which the
      average charge per unit distributed has exceeded the maximum average charge
      per unit distributed is more than 4 per cent,then
      in the next following relevant year the licensee shall, if required by the
      Authority, adjust its charges such that the average charge per unit distributed
      would not be likely, in the judgement of the Authority, to exceed the maximum
      average charge per unit in that next following relevant year.                                                                                                                          
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|3. | If, in respect
      of two successive relevant years, the average charge per unit distributed
      is less than 90 per cent of the maximum average charge per unitdistributed,the Authority, after consultation with the licensee, may direct that in
      calculating Kdtfor the purposes ofparagraph
      6 of Special Condition B (Restriction of distribution charges) in respect
      of the next following relevant year, there shall be substituted for Rdt-1in the formula at paragraph 6 ofSpecial
      Condition B (Restriction of distribution charges) such figure as the Authority
      mayspecify
      being not less than Rdt-1
      and not more than 0.90 (Dt-1.Mdt-1).



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|Special
      Condition D: Information to be provided to the Authority in connection with
      the charge restriction conditions
|---------------------------------------------------------------------------------------------------------------------------------
|                                                                                                                                 
|1.                                                                                                                               
|                                                                                                                                 
|                                                                                                                                 
|                                                                                                                                 
|                                                                                                                                 
|                                                                                                                                 
|2.                                                                                                                               
|                                                                                                                                 
|3.                                                                                                                               
|                                                                                                                                 
|4.                                                                                                                               
|                                                                                                                                 
|5.                                                                                                                               
|                                                                                                                                 
|                                                                                                                                 
|                                                                                                                                 
|                                                                                                                                 
|                                                                                                                                 
|6.                                                                                                                               

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|7. | Not
      later than three months after the end of a relevant year the licensee shall
      send to the Authority a statement, in respect of that relevant year, showing
      the specified items referred to in paragraph 9.
|-- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                                                                                                               
|8. | The
      statement referred to in the preceding paragraph shall be:                                                                                                                                                          
|   |                                                                                                                                                                                                                               
|   | (a)                                                                                                                                                                                                                           
|   |                                                                                                                                                                                                                               
|   | (b)                                                                                                                                                                                                                           
|   |                                                                                                                                                                                                                               
|   |                                                                                                                                                                                                                               
|   |                                                                                                                                                                                                                               
|   |                                                                                                                                                                                                                               
|   |                                                                                                                                                                                                                               
|   |                                                                                                                                                                                                                               
|   |                                                                                                                                                                                                                               
|   |                                                                                                                                                                                                                               
|   |                                                                                                                                                                                                                               
|   |                                                                                                                                                                                                                               
|   |                                                                                                                                                                                                                               
|   |                                                                                                                                                                                                                               
|   |                                                                                                                                                                                                                               
|9. | The
      specified items to be contained in the statement referred to in paragraph
      7 shall be the following:                                                                                                           
|   |                                                                                                                                                                                                                               
|   | (a)                                                                                                                                                                                                                           
|   |                                                                                                                                                                                                                               
|   | (b)                                                                                                                                                                                                                           

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|    | (c)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             | the average
      charge per unit distributed;                                                                                                                                                                                                                                                                      
|--- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |                                                                                                                                                                                                                                                                                                                     
|    | (d)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             | the amount
      in respect of the TermsALt
      and Lt, in paragraph 3 of Special Condition B (Restriction of
      distribution charges) calculated as therein provided;                                                                                                                                         
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |                                                                                                                                                                                                                                                                                                                     
|    | (e)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             | the value
         of the termTAdt
      in respect of the tenth relevant year only, together with the value of
      each  of its component parts, as detailed in paragraph 4 of Special Condition
      B
      (Restriction of distribution charges) in the form of the licence in force
       on 31 March 2000;
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |                                                                                                                                                                                                                                                                                                                     
|    | (f)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             | the
      information referred to at paragraph 8 of Special Condition E (Allowance
      in respect of security costs);                                                                                                                                                                                             
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |                                                                                                                                                                                                                                                                                                                     
|    | (g)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             | the statements
      and information referred to in paragraphs A5, B2, C7, D1 and E10 of Schedule
      A.                                                                                                                                                                                                          
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |                                                                                                                                                                                                                                                                                                                     
|10. | Where
      the Authority issues directions in accordance with paragraph 9 of Special
      Condition E (Allowance in respect of security costs) or paragraphs A6, B3,
      C8, D5 or E11 of Schedule A then such directions shall not have effect from
      a date earlier than the commencement of the relevant year to which the statement
      last furnished to the Authority pursuant to paragraph 7 prior to the issue
      of the directions related, unless such statement (or the accompanying report
      or certificate under paragraph 8) or any statement, report or certificate
      in respect of an earlier relevant year was incorrect or was misleading in
      any material respect.
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |                                                                                                                                                                                                                                                                                                                     
|11. | Where
      the Authority issues such directions as are referred to in the preceding
      paragraph the Authority may require the licensee to provide a revised statement
      in respect of such of the specified items as may be affected by the directions,
      and the licensee shall comply with such request.                                                                                                                                                                                                                                                                                                                                                                                        

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|Special
    Condition E: Allowance in respect of security costs
|---------------------------------------------------------------
|                                                               
|1.                                                             
|                                                               
|2.                                                             
|                                                               
|                                                               
|                                                               
|                                                               
|                                                               
|                                                               
|                                                               
|                                                               
|                                                               
|                                                               
|                                                               
|                                                               
|                                                               
|3.                                                             
|                                                               
|4.                                                             

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|5.  | If within
        three months of the receipt by the Authority of the disapplication request
        referred to in paragraph 4, the Authority has either not agreed in writing
        to such disapplication request or has not made a reference to the Competition
        Commission under Section 12 of the Act relating to the modification of
        the charge restriction conditions, the licensee may deliver one month's
        written notice to the Authority terminating the application of the charge
        restriction conditions (or any part or parts thereof) as were specified
    in the disapplication request                                                                                                            
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|6.  | Subject
          to paragraphs 7 and 9, the licensee shall in any relevant year be entitled
          to recover an aggregate amount equal to its allowed security costs
          in that year or (insofar as not previously recovered) any previous
          year, by means of appropriate equitable increases on the charges made
    by the licensee in its distribution business.                                                                                                                                                                                                                                                                                                                                                            
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|7.  | Paragraph
    6 shall not apply in so far as such allowed security costs:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|    | (a)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|    | (b)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|8.  | The
          licensee shall following the end of each relevant year provide to the
          Authority, as being one of the specified items to be contained in the
          statement referred to at paragraph 7 of Special Condition D (Information
          to be provided to the Authority in connection with the charge restriction
    conditions), details in respect of that relevant year of:                                                                                                                                                                                                                                                                                                                                            
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|    | (a)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|    | (b)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|    | (c)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|9.  | Where
          the Authority is satisfied that the licensee has recovered amounts
          in excess of the allowed security costs, the Authority may issue directions
          requiring the licensee to take such steps as may be specified to reimburse
          purchasers from the distribution business for the excess amounts charged
          to them, and the licensee shall comply with any directions so issued
          provided that if the excess amounts relate to allowed security costs
          paid to any authorised electricity operator, the licensee shall not
          be obliged to make any such reimbursement unless and until it has recovered
    such costs from the relevant authorised electricity operator.
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|10. | No amounts
        charged by the licensee under this Condition (whether or not subsequently
        required to be reimbursed) shall be taken into account for the purpose
        of applying the charge restriction provisions of Special Condition B
    (Restriction of distribution charges).                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|11. | In this
    Condition:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              

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| |  | allowed
    security cost | shall have
    the meaning ascribed to that term in the Fuel Security Code.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
| |  | --------------------------- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  |                             |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
| |  | security
      period     | means a
        period commencing on the date on which any direction issued by the Secretary
        of State under Section 34(4)(b) of the Act enters into effect and terminating
        on the date (being not earlier than the date such direction, as varied,
        is revoked or expires) as the Authority, after consultation with such
        persons (including without limitation, licence holders liable to be principally
        affected) as it shall consider appropriate, may with the consent of the
        Secretary of State by notice to all licence holders determine after having
    regard to the views of such persons.

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|Special
    Condition F: Duration of charge restriction conditions
|------------------------------------------------------------------
|                                                                  
|1.                                                                
|                                                                  
|                                                                  
|                                                                  
|                                                                  
|                                                                  
|2.                                                                
|                                                                  
|3.                                                                
|                                                                  
|                                                                  
|                                                                  
|                                                                  
|                                                                  
|4.                                                                
|                                                                  
|5.                                                                

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|6.                                                                              | A
      disapplication request or notice served under this Condition may be served
      in respect of a specified geographic area.                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|------------------------------------------------------------------------------- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|                                                                               
|SCHEDULE
      A: SUPPLEMENTARY PROVISIONS OF THE CHARGE RESTRICTION CONDITIONS
|                                                                                |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|Part
      A. Principles for Attribution                                       
|                                                                                |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|General
      Principles                                                       
|                                                                                |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|A1.                                                                             | Where
      for the purposes of the charge restriction conditions, a share of costs
      borne by the licensee requires to be attributed to any part of the market,
      the licensee shall make that attribution on a basis which ensures that no
      more than a fair proportion of those costs, reflecting the costs incurred
      by the licensee in supplying that part of the market, are so attributed.                                                                                                                                                                              
|                                                                                |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|A2.                                                                             | The
      following paragraphs of this Part of Schedule A are without prejudice to
      paragraph A1.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|                                                                                |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|                                                                                | Transmission connection point charges and remote transmission asset rentals                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|                                                                                |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|A3.                                                                             | The
      transmission connection point charges and remote transmission asset rentals
      requiring to be attributed between the regulated quantity distributed and
      other quantities distributed shall be attributed in proportion to the transmission
      connection point and remote transmission asset capacity required for the
      purpose of distributing those quantities.                                                                                                                                                                                                    
|                                                                                |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|Distribution
      losses                                                      
|                                                                                |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|A4.                                                                             | Where
      an amount (in units) in respect of distribution losses requires to be calculated
      and attributed in respect of EHV units and units distributed by the licensee
      for the purpose of supply to premises outside the licensees distribution
      services area, such calculation and attribution shall be made consistently
      with the principles underlying the schedule of adjustment factors referred
      to at sub-paragraph (b) of paragraph 2 of Condition 4 (Basis of Charges
      for Use of System and Connection to System: Requirements for Transparency).
|                                                                                |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|Information
      to be provided by licensee                                   
|                                                                                |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|A5                                                                              | The
      licensee shall following the end of each relevant year furnish to the Authority,
      as being one of the specified items to be included in the statement referred
      to at paragraph 7 of Special Condition D (Information to be provided to
      the Authority in connection with the charge restriction conditions), a statement
      confirming that the calculation of , the transmission connection point charges,
      the remote transmission asset rentals and of                                                                                                      

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|   | distribution
        losses was made in accordance with the provisions of this Part of Schedule
    A.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|-- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|A6 | Where the
        Authority is satisfied that the basis of calculation or attribution (as
        the case may be) used by the licensee is not in conformity with paragraph
        A1, the Authority may issue directions specifying an alternative basis
        of calculation or attribution, and the basis of calculation or attribution
        by the licensee (as the case may be) shall be adjusted accordingly with
        effect from the date of issue of the directions or (subject to paragraph
        10 of Special Condition D (Information to be provided to the Authority
        in connection with the charge restriction conditions)) such other date
    as may be specified in those directions.

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Part B. EHV premises

|B1. | EHV
    premises shall comprise:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|    | (a)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|    | (b)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|B2. | The licensee shall following the end of each relevant year furnish to the Authority, as being one of the specified items to be included in the statement referred to at paragraph 7 of Special Condition D (Information to be provided to the Authority in connection with the charge restriction conditions), a statement listing any changes in the premises falling to be treated as EHV premises.                                                                                                                                    
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|B3. | Where the Authority is satisfied that any premises treated by the licensee as EHV premises should not in conformity with sub-paragraph B1(b) above be so treated, the Authority may issue directions to that effect, and such premises shall cease to be treated as EHV premises from the date of issue of the directions or (subject to paragraph 10 of Special Condition D (Information to be provided to the Authority in connection with the charge restriction conditions)) such other date as may be specified in those directions.

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Part C. Excluded services

|C1. | There
        may be treated as excluded services provided by the licensee in its distribution
    business such services in respect of which charges are made which:                                                                                                                                                                                        
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                                                                                                                                                                                                                                                              
|    | (a)                                                                                                                                                                                                                                                                                                                                                          
|    |                                                                                                                                                                                                                                                                                                                                                              
|    | (b)                                                                                                                                                                                                                                                                                                                                                          
|    |                                                                                                                                                                                                                                                                                                                                                              
|C2. | No
        service provided by the licensee as part of its distribution business
        shall be treated as an excluded service in so far as it consists of the
        provision of services remunerated under the use of system charges in
        accordance with paragraph 2 of Standard Condition 4 including (without
    prejudice to the foregoing):
|    |                                                                                                                                                                                                                                                                                                                                                              
|    |                                                                                                                                                                                                                                                                                                                                                              
|    |                                                                                                                                                                                                                                                                                                                                                              
|    |                                                                                                                                                                                                                                                                                                                                                              
|    |                                                                                                                                                                                                                                                                                                                                                              
|    |                                                                                                                                                                                                                                                                                                                                                              
|    |                                                                                                                                                                                                                                                                                                                                                              
|    |                                                                                                                                                                                                                                                                                                                                                              
|    |                                                                                                                                                                                                                                                                                                                                                              
|C3. | The
        licensee may treat as being an excluded service for the purposes of its
    distribution business the transport of:                                                                                                                                                                                                                              
|    |                                                                                                                                                                                                                                                                                                                                                              
|    | (a)                                                                                                                                                                                                                                                                                                                                                          
|    |                                                                                                                                                                                                                                                                                                                                                              
|    | (b)                                                                                                                                                                                                                                                                                                                                                          

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|                                                |                                                                                                                                                                                                                                                                                                                                                                                                                                                                        | the
      actual charges made and the charging rates underlying the information as
    to EHV revenue provided to the Authority by the licensee.                                                                                                                                                                                                                           
|----------------------------------------------- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|                                                |                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|C4.                                             | Charges of the type described in paragraph 3 of standard condition 4 and charges in respect of the statements referred to in paragraph 4 of standard condition 4, may each be treated as excluded services for the purposes of the distribution business.                                                                                                                                                                                                             
|                                                |                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|C5.                                             | A service provided by the licensee as part of its distribution business may be treated as an excluded service in so far as it consists in the provision of services (including metering, electric lines or electrical plant) for the specific benefit of any third party requesting the same and not made available by the licensee as a normal part of its distribution business remunerated by use of system charges including (without prejudice to the foregoing):
|                                                |                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |                                                                                                                                                                                                                                                                                                                                                                            
|                                                | (i)                                                                                                                                                                                                                                                                                                                                                                                                                                                                    | special
      metering (including time of day metering) to facilitate energy
    saving programmes for the benefit of customers requesting the same;                                                                                                                                                                                                                     
|                                                |                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |                                                                                                                                                                                                                                                                                                                                                                            
|                                                | (ii)                                                                                                                                                                                                                                                                                                                                                                                                                                                                   | charges
      for moving mains, services or meters forming part of the licensees
      distribution system to accommodate extension, re-design or re-development
    of any premises on which the same are located or to which they are connected;                                                                                                                        
|                                                |                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |                                                                                                                                                                                                                                                                                                                                                                            
|                                                | (iii)                                                                                                                                                                                                                                                                                                                                                                                                                                                                  | the
      provision of electric lines and electrical plant (a) insofar as the same
      are required for the specific purpose of enabling the provision of top-up
      or standby supplies or sales of electricity or (b) to provide a higher
      degree of security than is required for the purposes of complying with
    standard condition 5;                     
|                                                |                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |                                                                                                                                                                                                                                                                                                                                                                            
|                                                | (iv)                                                                                                                                                                                                                                                                                                                                                                                                                                                                   | the
      amount by which charges for the provision of prepayment meters to customers
      exceed charges for the provision of standard meters for such customers,
      in respect of which the amount receivable per customer shall not exceed
      that used by the Authority in formulating PUM in Special Condition B (Restriction
    of distribution charges); and
|                                                |                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |                                                                                                                                                                                                                                                                                                                                                                            
|                                                | (v)                                                                                                                                                                                                                                                                                                                                                                                                                                                                    | special metering
    or telemetry or data processing equipment for the purposes of enabling any
    person which is a party to the BSC to comply with its obligations in respect
    of metering thereunder, or for the performance by the licensee of any service
    in relation thereto.                                                                                
|                                                |                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|C6.                                             | There
      may be treated as an excluded service for the purposes of the distribution
      business, charges for the relocation of electric lines or electrical plant
      and the carrying out of works associated therewith pursuant to a statutory
      obligation (other than under Section 9(1) or Section 16 of the Act) imposed
    on the licensee.                                                                                                       
|                                                |                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |                                                                                                                                                                                                                                                                                                                                                                            
|Information
    to be provided to the Authority
|                                                |                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |                                                                                                                                                                                                                                                                                                                                                                            
|C7.                                             | The
      licensee shall following the end of each relevant year furnish to the Authority,
      as being one of the specified items to be included in the statement referred
    to at paragraph                                                                                                                                                                                                                                                                     

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|    | 7 of Special
        Condition D (Information to be provided to the Authority in connection
        with the charge restriction conditions), details specifying separately
        the nature of all services provided as part of its distribution business
        and treated as excluded services by the licensee during the course of
        such year and stating the revenues derived by the licensee in respect
    of each such service so treated.                                                                                                                                                                                                                 
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|C8. | Where the
        Authority is satisfied that in light of the principles set out in paragraphs
        C2 to C6 inclusive any service treated by the licensee as an excluded
        service should not be so treated, the Authority shall issue directions
        to that effect, and the service or services specified in the directions
        shall cease to be treated as excluded services from the date of issue
        of the directions or (subject to paragraph 10 of Special Condition D
        (Information to be provided to the Authority in connection with the charge
    restriction conditions)) such other date as may be specified in the directions.

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Part D. Regulated distribution unit categories

|D1. | The licensee
        shall following the end of each relevant year furnish to the Authority,
        as being one of the specified items to be included in the statement referred
        to at paragraph 7 of Special Condition D (Information to be provided
        to the Authority in connection with the charge restriction conditions),
        details specifying separately those use of system charges in respect
        of which the licensee has during the course of such year treated the
        units distributed as falling within the definition of each of LV1 units
    and LV2 units and LV3 units respectively.
|--- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|D2. | The definition
    of LV1 units includes units distributed under the following tariffs:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|D3. | The
        definition of LV2 units includes units distributed under the following
    tariffs:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|D4. | The
        definition of LV3 units includes units distributed under the following
    tariffs:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|D5. | Notwithstanding
        the provisions of paragraphs D2 to D4 above, where the Authority is satisfied
        that a tariff or tariffs in respect of which the licensee has treated
        the units distributed as falling within one of the categories in paragraphs
        D2 to D4 above should not be so treated, the Authority shall issue directions
        to that effect and the tariff or tariffs specified in the directions
        shall cease to be so treated from the date of issue of the directions
        or (subject to paragraph 10 of Special Condition D (Information to be
    provided                   



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| | to the
        Authority in connection with the charge restriction conditions)) such
        other date as may be specified in the directions and shall with effect
    from such date be treated in such manner as may be specified in the directions.
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

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|Part
    E. Calculation of factor in respect of distribution losses        
|---------------------------------------------------------------------------
|                                                                           
|E1.                                                                        
|                                                                           
|Consistent
          methodological basis for determination ofALtand
    Lt
|                                                                           
|E2.                                                                        
|                                                                           
|E3.                                                                        
|                                                                           
|                                                                           
|                                                                           
|                                                                           
|                                                                           
|                                                                           
|                                                                           
|                                                                           
|                                                                           
|                                                                           
|                                                                           
|E4.                                                                        
|                                                                           
|                                                                           
|                                                                           
|                                                                           
|                                                                           
|                                                                           



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|                                                                |                                                                                                                                                                                                           | (b)                                                                                                                                                                                                                                                                                                                  | such
        other factor to take account of losses occurring between the grid supply
        points and the bulk supply points as the licensee may with the prior
    approval of the Authority determine to be appropriate.
|--------------------------------------------------------------- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|                                                                |                                                                                                                                                                                                           |                                                                                                                                                                                                                                                                                                                      |                                                                                                                                                                                                                              
|E5.                                                             | Adjusted
    units distributed shall be obtained by:                                                                                                                                                     
|                                                                |                                                                                                                                                                                                           |                                                                                                                                                                                                                                                                                                                      |                                                                                                                                                                                                                              
|                                                                | (a)                                                                                                                                                                                                       | calculating
        all units distributed by the licensee metered at exit points on leaving
    the licensees distribution system; and                                                                                                                                                                             
|                                                                |                                                                                                                                                                                                           |                                                                                                                                                                                                                                                                                                                      |                                                                                                                                                                                                                              
|                                                                | (b)                                                                                                                                                                                                       | deducting
        therefrom EHV units and units distributed for the purpose of supply to
    premises outside the licensees distribution services area; and                                                                                                                                                        
|                                                                |                                                                                                                                                                                                           |                                                                                                                                                                                                                                                                                                                      |                                                                                                                                                                                                                              
|                                                                | (c)                                                                                                                                                                                                       | adding
        thereto an amount equal to the units consumed on the licensees
        premises in the distribution services area (insofar as not otherwise
        taken into account in determining units distributed under sub-paragraph
    (a) above).                                                         
|                                                                |                                                                                                                                                                                                           |                                                                                                                                                                                                                                                                                                                      |                                                                                                                                                                                                                              
|Initial
    relevant loss percentage in the term ALt           
|                                                                |                                                                                                                                                                                                           |                                                                                                                                                                                                                                                                                                                      |                                                                                                                                                                                                                              
|E6.                                                             | In
        the first relevant year, the initial relevant loss percentage in the
        termALtshall
        (consistentlywith
    the methodology set out in paragraphs E2 to E5 above) be deemed to be:
|                                                                |                                                                                                                                                                                                           |                                                                                                                                                                                                                                                                                                                      |                                                                                                                                                                                                                              
|adjusted
    GSP purchase units less adjusted units distributed
|                                                                |                                                                                                                                                                                                           | adjusted
    units distributed                                                                                                                                                                                                                                                                                      
|                                                                |                                                                                                                                                                                                           |                                                                                                                                                                                                                                                                                                                      |                                                                                                                                                                                                                              
|                                                                | where
        adjusted GSP purchase units are calculated as provided in paragraph E7
        and adjusted units distributed are calculated as provided in paragraph
    E8.                              
|                                                                |                                                                                                                                                                                                           |                                                                                                                                                                                                                                                                                                                      |                                                                                                                                                                                                                              
|E7.                                                             | Adjusted
        GSP purchase units shall be calculated in accordance with the procedures
    successively described in the following sub-paragraphs:                                                    
|                                                                |                                                                                                                                                                                                           |                                                                                                                                                                                                                                                                                                                      |                                                                                                                                                                                                                              
|                                                                | (a)                                                                                                                                                                                                       | the
        actual losses in each of relevant years t-1, t-2 and t-3 (the historical
        losses) shall be calculated as the difference in each of those
        years between units purchased at entry points to the licensees
    distribution system and units sold;                                       
|                                                                |                                                                                                                                                                                                           |                                                                                                                                                                                                                                                                                                                      |                                                                                                                                                                                                                              
|                                                                | (b)                                                                                                                                                                                                       | the
        historical loss percentage shall be calculated as the proportion (expressed
        as a percentage) which the aggregate historic losses were of the aggregate
        units purchased at entry points to the licensees distribution system,
    in each case over the three relevant years t-1 to t-3;
|                                                                |                                                                                                                                                                                                           |                                                                                                                                                                                                                                                                                                                      |                                                                                                                                                                                                                              
|                                                                | (c)                                                                                                                                                                                                       | the
        total number of units sold in relevant year t-1 shall be grossed up by
    the historical loss percentage (BSP purchase units); and                                                                                                                                                                   
|                                                                |                                                                                                                                                                                                           |                                                                                                                                                                                                                                                                                                                      |                                                                                                                                                                                                                              
|                                                                | (d)                                                                                                                                                                                                       | the
        figure for BSP purchase units resulting from sub-paragraph (c) shall
        be adjusted to obtain adjusted GSP purchase units in accordance with
    the provisions of paragraphs E3 and E4 above.                                                                                                     



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|E8.                                             | Adjusted
        units distributed shall be calculated by applying the methodology of
        paragraph E5 in respect of those units referred to in sub-paragraphs
    (a) to (c) of paragraph E5 in relevant year t-1.                                                                                                                                                                                                                                                                                                                                                                                  
|----------------------------------------------- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|                                                |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|Information
    to be provided to the Authority
|                                                |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|E9.                                             | The
        licensee shall within three months after the entry into force of this
        licence furnish to the Authority a statement showing the initial relevant
    loss percentage and the underlying calculations.                                                                                                                                                                                                                                                                                                                                                                                 
|                                                |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|E10.                                            | The
        licensee shall, following the end of each relevant year, furnish to the
        Authority, as being one of the specified items to be included in the
        statement referred to at paragraph 7 of Special Condition D (Information
        to be provided to the Authority in connection with the charge restriction
        conditions), a statement showing adjusted distribution losses for that
        relevant year, accompanied by the underlying calculations and (where
        appropriate) an explanation of any changes in the basis of calculation
    or estimation thereof.
|                                                |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|E11.                                            | Where
        the Authority is satisfied that any statement or underlying calculation
        provided has not been drawn up in conformity with paragraphs E2 to E8
        above, the Authority may issue directions, and the statement or underlying
        calculation shall be adjusted with effect from the date of issue of the
        directions or (subject to paragraph 10 of Special Condition D (Information
        to be provided to the Authority in connection with the charge restriction
    conditions)) such other date as may be specified in the directions.                      



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SCHEDULE 1

SPECIFIED AREA

Great Britain



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SCHEDULE
2

REVOCATION

|1. | The
       Authority may at any time revoke the licence by giving no less than 30
       days notice (24 hours notice, in the case of a revocation
    under sub-paragraph 1(f)) in writing to the licensee:
|-- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                                                                                               
|   | (a)                                                                                                                                                                                                           
|   |                                                                                                                                                                                                               
|   | (b)                                                                                                                                                                                                           
|   |                                                                                                                                                                                                               
|   | (c)                                                                                                                                                                                                           
|   |                                                                                                                                                                                                               
|   |                                                                                                                                                                                                               
|   |                                                                                                                                                                                                               
|   |                                                                                                                                                                                                               
|   |                                                                                                                                                                                                               
|   | (b)                                                                                                                                                                                                           
|   |                                                                                                                                                                                                               
|   |                                                                                                                                                                                                               
|   |                                                                                                                                                                                                               
|   |                                                                                                                                                                                                               
|   |                                                                                                                                                                                                               
|   | (c)                                                                                                                                                                                                           
|   |                                                                                                                                                                                                               
|   |                                                                                                                                                                                                               
|   |                                                                                                                                                                                                               
|   |                                                                                                                                                                                                               



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|   | (d)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      | if
    the licensee:                                                                                                                        
|-- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | --------------------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |                                                                                                                                             
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          | (i)                                                                                                                                         
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |                                                                                                                                             
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          | (ii)                                                                                                                                        
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |                                                                                                                                             
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          | (iii)                                                                                                                                       
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |                                                                                                                                             
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          | (iv)                                                                                                                                        
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |                                                                                                                                             
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          | (v)                                                                                                                                         
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |                                                                                                                                             
|   | (g)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      | if
      the licensee is convicted of having committed an offence under section
    59 of the Act in making its application for the licence.
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |                                                                                                                                             
|2. | For
      the purposes of sub-paragraph 1(f)(i), section 123(1)(a) of the Insolvency
      Act 1986 shall have effect as if for £750 there was substituted £100,000 or
      such higher figure as the Authority may from time to time determine by
    notice in writing to the licensee.                                                                                                                                                                                          
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |                                                                                                                                             
|3. | The
      licensee shall not be deemed to be unable to pay its debts for the purposes
      of sub-paragraph 1(f)(i) if any such demand as is mentioned in section
      123(1)(a) of the Insolvency Act 1986 is being contested in good faith by
      the licensee with recourse to all appropriate measures and procedures or
      if any such demand is satisfied before the expiration of such period as
    may be stated in any notice given by the Authority under paragraph 1.



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SCHEDULE 3

DISTRIBUTION SERVICES AREA

The distribution services area shall comprise that area which is outlined on the attached map and shall additionally include those premises listed in List A (the Additional Premises) but shall not include those premises listed in List B (the Excluded Premises).

|A: | ADDITIONAL PREMISES                |                    | 
|-- | ---------------------------------- | ------------------ | 
|   |                                    |                    | 
|   |                                    |                    | 
|   | Address                            | Grid
      Ref:    | 
|   |                                    |                    | 
|   | Congleton
      Youth Centre       | SJ
      8658 6420 | 
|   | Jacksons
      Road                |                    | 
|   | Eaton Bank                         |                    | 
|   | Congleton                          |                    | 
|   | CW12 1NT                           |                    | 
|   |                                    |                    | 
|   | Dane Valley
      High School      | SJ
      8655 6425 | 
|   | Jacksons
      Road                |                    | 
|   | Eaton Bank                         |                    | 
|   | Congleton                          |                    | 
|   | CW12 1NT                           |                    | 
|   |                                    |                    | 
|   | Eaton Bank
      Farm              | SJ
      8652 6410 | 
|   | Jacksons
      Road                |                    | 
|   | Eaton Bank                         |                    | 
|   | Congleton                          |                    | 
|   | CW12 1PF                           |                    | 
|   |                                    |                    | 
|   | Eaton Bank
      Farm Cottage      | SJ
      8650 6412 | 
|   | Jacksons
      Road                |                    | 
|   | Eaton Bank                         |                    | 
|   | Congleton                          |                    | 
|   | CW12 1PF                           |                    | 
|   |                                    |                    | 
|   | Building
      D                   | SJ
      8670 6390 | 
|   | Eaton Bank
      Trading Estate    |                    | 
|   | Congleton                          |                    | 
|   | CW12 1PH                           |                    | 
|   |                                    |                    | 
|   | Building
      E                   | SJ
      8650 6390 | 
|   | Eaton Bank
      Trading Estate    |                    | 
|   | Congleton                          |                    | 
|   | CW12 1PH                           |                    | 
|   |                                    |                    | 
|   | Halsall
      Lane Pumping Station | SJ
      4080 0864 | 
|   | Halsall
      Lane                 |                    | 
|   | Ormskirk                           |                    | 
|   | L39 3AT                            |                    | 

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|B: | EXCLUDED PREMISES |                 | 
|-- | ----------------- | --------------- | 
|   |                   |                 | 
|   |                   |                 | 
|   | Address           | Grid
      Ref: | 
|   |                   |                 | 
|   | None              |                 | 

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