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                                                                   EXHIBIT 10.42


                          MIDLAND COGENERATION VENTURE
                               LIMITED PARTNERSHIP
                    AMENDED SENIOR MANAGEMENT INCENTIVE PLAN


1.       Purpose:  The purpose of the Senior Management Incentive Plan is to:

         -    Provide an equitable and competitive level of compensation that
              will permit the Midland Cogeneration Venture to attract, retain,
              and motivate highly competent senior management employees.

         -    Provide a financial incentive for senior management employees to
              achieve expected levels of Company and individual performance and
              thereby assist in the achievement of MCV goals.

2.       Eligibility: Senior management employees in salary grades 15 and above
         are eligible for participation in the Plan. All participants will
         receive a pro rata award equal to 1/12 of the amount they would
         otherwise be entitled to for each full month of employment during the
         performance year.

3.       Administration: The Senior Management Incentive Plan will be
         administered by the President and Chief Executive Officer of MCV and
         the Vice President, Human Resources under the general direction of the
         MCV Partnership.

4.       Standard Award: The standard award for each senior management employee
         will amount to a percentage of the midpoint of his or her salary grade
         in the performance year. The percentage will vary by position level as
         indicated below:

<TABLE>
<CAPTION>

                           Position                               Standard Award
                           --------                               --------------
                                                          (as a percentage of midpoint)
<S>                               <C>                                  <C>
                            Level 5                                    40%
                            Level 4                                    30%
                            Level 3                                    25%
                            Level 2                                    20%
                            Level 1                                    15%
</TABLE>

         The position levels for an employee will be designated by the President
         and Chief Executive Officer based on the individual's contribution to
         the MCV goals, base salary, and other considerations. These position
         levels may vary from award year to award year, as appropriate.

5.       Final Award and Performance Factors: Each standard award is converted
         to a final award based on the degree of achievement of both Company and
         individual performance factors. Individual goals of each participant in
         this plan are prepared and approved by the President and Chief
         Executive Officer prior to (or shortly after) the start of a
         performance year. At the end of the year, or shortly thereafter, each
         plan participant prepares a written evaluation on their goals and their
         immediate supervisor establishes an achievement factor on the written
         evaluation of each participant.

         The Company financial performance factor is determined by calculating
         the ratio of MCV's actual net income for the performance year, divided
         by the budgeted net income for the performance year. Where 
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         the ratio is less than .80, no final awards for any plan participant
         will be made for that specific performance year.

         The calculation of the final award for each participant will be
         computed as follows: % individual goal achievement x net income factor
         x standard award % x base salary.

6.       Payment of Awards: One half of the total award will be paid in cash no
         later than March 15 of the year following the performance year after
         approval by the President and Chief Executive Officer of MCV and the
         Midland Cogeneration Partnership. The amounts required by law to be
         withheld for income tax and Social Security taxes will be deducted from
         the award payments.

         The second half of the total award will be made during the first week
         of January, one full year after the performance year. This second
         payment will be credited with sums in lieu of interest from the first
         day of the month following the month in which the award was granted to
         the date of payment. The "interest rate" will be equivalent to the
         prime rate of interest set by Citibank, N.A. compounded quarterly as of
         the first day of January, April, July, and October of each year during
         the deferral period. The prime rate in effect on the first day of
         January, April, July, and October shall be the prime rate in effect for
         that quarterly period.

         Those employees eligible to receive the deferred portion of the award
         will be regular full-time employees of MCV still actively employed the
         first normal business day of January one full year after each
         performance year; those otherwise qualified employees on an approved
         leave of absence on such date; and those of the qualified employees
         whose employment terminated during or after the Performance Year due
         to:

         -        Retirement with Retirement Income or Disability payments under
                  the Pension Plan;

         -        Layoff because of changes in Company operations; or

         -        Death of the employee.

         An employee whose services are terminated for cause during the
         Performance Year shall not be eligible for any deferred amounts. Any
         employee who resigns to accept employment elsewhere shall also be
         ineligible for payment of deferred awards.

         If for any reason the Midland Cogeneration Venture Senior Management
         Incentive Plan should terminate, all deferred awards shall be
         immediately payable to eligible participants as defined above.

7.       Change of Status During the Performance Year:

         a.       New Hire:  A newly hired employee may be recommended for a pro
                  rata award based on the percentage of the Performance Year the
                  employee is in the position.

         b.       Demotion: No award will be made to an employee who has been
                  demoted during the Performance Year due to performance. If the
                  demotion is due to an organizational change, a pro rata award
                  will be made as stated above.

         c.       Termination: An employee whose services are terminated during
                  the Performance Year for reasons of misconduct, failure to
                  perform, or other performance-related reasons shall not be
                  considered for an award. If the termination is due to other
                  reasons such as reorganization and 
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                  the termination is not due to a fault of the employee, the
                  employee may be considered for a pro rata award.

         d.       Resignation: An employee who resigns to accept employment
                  elsewhere (including self-employment) will not be considered
                  for an award. If the resignation is due to other reasons
                  (i.e., ill health in the immediate family), the employee may
                  be considered for a pro rata award.

         e.       Death, Disability, Retirement, and Leave of Absence: An
                  employee whose status as an active employee is changed during
                  the Performance Year for any of the reasons cited may be
                  considered for a pro rata award.

8.       Impact on Benefit Plans: Payments made under the Plan will not be
         considered as earnings for purposes of the Pension Plan, Savings Plan,
         insurance plans, or any other employee benefit.

9.       Termination or Amendment of the Plan: Midland Cogeneration Venture at
         any time may in writing terminate or amend the Plan.