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                                                                  EXHIBIT 10.16


                     ROCHESTER GAS AND ELECTRIC CORPORATION

                              SEVERANCE AGREEMENT


     This Severance Agreement is made effective as of this 2nd  day of January
                                                           ----        -------
1996, by and between Rochester Gas and Electric Corporation, a New York
----                                                                   
corporation having its principal place of business in Rochester, New York (the
"Company"), and J. Burt Stokes, an individual currently residing in Rochester,
                --------------                                                
New York (the "Employee").

     1.  Payment of Severance Amount.  If the Employee's employment by the
Company or any subsidiary or successor of the company shall be subject to a
Voluntary Termination or an Involuntary Termination within the Covered Period,
then the Company shall pay the Employee a lump sum amount equal to the
applicable Severance Amount, payable within 15 business days after the
Termination Date.

     2.  Definitions.  All the terms defined in this paragraph 2 shall have the
meanings given below throughout this Agreement.

         (a) "Annual Salary"  shall, as determined on the Termination Date, be
equal to the greater of:

             i.  the Employee's annual salary plus bonus on the date of the
earliest Change of Control to occur during the Covered Period, or

             ii.  the Employee's annual salary plus bonus on the Termination
Date.

Bonuses for the purpose of this definition of Annual Salary shall mean the bonus
for the Employee's final year or the average of the bonuses for the last three
years, whichever is greater.

         (b) "Change in Duties" shall mean any one or more of the following:

             i.  a significant change in the nature or scope of the Employee's
authorities or duties from those applicable to him immediately prior to the date
on which a Change of Control occurs;

             ii.  a reduction in the Employee's Annual Salary from that
provided to him immediately prior to the date on which a Change of Control
occurs;

             iii.  a diminution in the Employee's eligibility to participate
in bonus, incentive award and other compensation plans which provide
opportunities to receive compensation, from the greater of:

             .  the opportunities provided by the Company (including its
                subsidiaries) for executives with comparable duties; or

             .  the opportunities under any such plans under which he was
                participating immediately prior to the date on which a Change
                of Control occurs;
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             iv.  a diminution in employee benefits (including but not limited
to medical, dental, life insurance and long-term disability plans) and
perquisites applicable to Employee, from the greater of:

             .  the employee benefits and perquisites provided by the Company
                (including its subsidiaries), to executives with comparable
                duties; or

             .  the employee benefits and perquisites to which he was entitled
                immediately prior to the date on which a Change of Control
                occurs;

             v.  a change in the location of the Employee's principal place of
employment by the Company (including its subsidiaries) by more than fifty miles
from the location where he was principally employed immediately prior to the
date on which a Change of control occurs; or

             vi.  a reasonable determination by the Board of Directors of the
Company that, as a result of a Change in Control and a change in circumstances
thereafter significantly affecting his position, he is unable to exercise the
authorities, powers, function or duties attached to his position immediately
prior to the date on which a Change of Control occurs.

         (c) a "Change of Control" shall be deemed to have occurred if:

             i.  any "person," including a "group" as determined in accordance
with the Section 13(d)(3) of the Securities Exchange Act of 1934 (the
"Exchange Act"), is or becomes the beneficial owner, directly or indirectly,
of securities of the Company representing 20 percent or more of the combined
voting power of the Company's then outstanding securities;

             ii.  as a result of, or in connection with, any tender offer or
exchange offer, merger or other business combination, sale of assets or
contested election, or any combination of the foregoing transactions (a
"Transaction"), the persons who were directors of the Company before the
transaction shall cease to constitute a majority of the Board of directors of
the Company or any successor to the Company;

             iii.  the Company is merged or consolidated with another
corporation and as a result of the merger or consolidation less than 70 percent
of the outstanding voting securities of the surviving or resulting corporation
shall then be owned in the aggregate by the former stockholders of the Company,
other than (x) affiliates within the meaning of the Exchange Act or (y) any
party to the merger or consolidation;

             iv.  a tender offer or exchange offer is made and consummated for
the ownership of securities of the Company representing 20 percent or more of
the combined voting power of the Company's then outstanding voting securities;
or

             v.  the Company transfers substantially all of its assets to
another corporation which is not a wholly-owned subsidiary of the Company.

         (d) "Covered Period" for the Employee shall mean a period of time
following the occurrence of the Change of Control equal to the lesser of (i) the
Employee's period of employment with the Company, any subsidiary, or any
predecessor of either prior to that Change of Control, or (ii) two years
following the occurrence of the Change of Control.
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         (e) "Involuntary Termination" shall mean any termination which:

             i.  does not result from a resignation by the Employee (other than 
a resignation pursuant to clause ii of this subparagraph (e); or

             ii.  results from a resignation following any Change in Duties;
provided, however, the term "Involuntary Termination" shall not include:

                  x.  a Termination for Cause, or

                  y.  any termination as a result of death, disability, or
normal retirement pursuant to a retirement plan to which the Employee was
subject prior to any Change of Control.

         (f)  "Severance Amount" is equal to:

             i.  in the case of an Involuntary Termination, two (2) times the
Employee's Annual Salary (except if the Employee is within two years of age 65
at the time of Involuntary Termination, the Severance Amount shall be reduced
to the number of whole months remaining to age 65, with a minimum payment of
one (1) times the Employee's Annual Salary) or the amount determined in
Section 3 below which does not produce an excise tax, whichever is higher; or

             ii.  in the case of a Voluntary Termination, one (1) times the
Employee's Annual Salary, except if the Employee is within one year of age 65
at the time of Voluntary Termination, the Severance Amount shall be reduced to
the number of months remaining to age 65, with no minimum payment.

         (g) "Termination for Cause" shall mean only a termination as a result
of fraud, misappropriation of or intentional material damage to the property or
business of the Company (including its subsidiaries), or commission of a felony
by the Employee.

         (h) "Voluntary Termination" shall mean any termination which is not:

             i.  an Involuntary Termination;

             ii.  a Termination for Cause, or

             iii.  the result of death, disability, or normal retirement
pursuant to a retirement plan to which the Employee was subject prior to any
Change of Control.

         (i) "Voting Securities" shall mean any securities which ordinarily
possess the power to vote in the election of directors without the happening
of any pre-condition or contingency.

         (j) "Termination Date" shall mean the date on which the Employee's
employment terminates.

     3.  Golden Parachute Payment Reduction.  It is the intention of the parties
that the Severance Amount in Section 2(f)(i) of this Agreement be such that it
is not subject to the excise tax imposed by Section 4999 of the Internal Revenue
Code of 1986, as amended (the "Code") (or any similar tax that may hereafter be
imposed), on account of "excess parachute payments" as
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defined in Section 280G of the Code.  However, it is also the intention of the
parties that the Severance Amount be at least equal to the largest amount that
will not be subject to the excise tax if that amount would exceed two (2) times
the Employee's Annual Salary.  The determination of this amount to be paid
hereunder shall be made at the expense of the Company by the independent
certified public accounting firm acting as auditors for the Company on the date
of a Change of Control (or another accounting firm designated by that firm).
Notwithstanding the foregoing in this Section 3, if payment is being prorated
because the Employee is within two years of agte 65, then the amount determined
pursuant to this Section 3 shall be the lesser of prorated amount or the amount
that is not subject to the excise tax.

     4.  Notices.  Notices and all other communications under this Agreement
shall be in writing and shall be deemed given when personally delivered or when
mailed by United States registered or certified mail, return receipt requested,
postage prepaid, addressed as follows:

         If to the Company, to:

               Rochester Gas & Electric Corporation
               89 East Avenue
               Rochester, New York  14649-0001
               ATTENTION:  Group Manager Human Resource Services


         If to the Employee, to:

               J. Burt Stokes
               -------------------------
               20 Summit Oaks
               -------------------------
               Pittsford, New York 14534
               -------------------------


or to such other address as either party may furnish to the other in writing,
except that notices of changes of address shall be effective only upon receipt.

     5.  Applicable Law.  This contract is entered into under, and shall be
governed for all purposes by, the laws of the State of New York.

     6.  Severability.  If a court of competent jurisdiction determines that any
provision of this Agreement is invalid or unenforceable, then the invalidity or
unenforceability of that provision shall not affect the validity or
enforceability of any other provision of this Agreement and all other provisions
shall remain in full force and effect.

     7.  Withholding of Taxes.  Company may withhold from any benefits payable
under this Agreement all Federal, state, city or other taxes as may be required
pursuant to any law, governmental regulation or ruling.

     8.  Not an Employment Agreement.  Nothing in this Agreement shall given the
Employee any rights (or impose any obligations to continued employment by the
Company or any subsidiary or successor of the Company), nor shall it give the
Company any rights (or impose any obligations) for the continued performance of
duties by the Employee for the Company or any subsidiary or successor of the
company.

     9.  No Assignment.  the Employee's right to receive payments or benefits
under this Agreement shall not be assignable or transferable, whether
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by pledge, creation of a security interest or otherwise, other than a transfer
by will or by the laws of descent or distribution.  In the event of any
attempted assignment or transfer contrary to this paragraph, the Company shall
have no liability to pay any amount so attempted to be assigned or transferred.
This Agreement shall inure to the benefit of and be enforceable by the
Employee's personal or legal representatives, executors, administrators,
successors, heirs, distributees, devisees and legatees.

     10.  Successors.  This Agreement shall be binding upon and insure to the
benefit of the Company, its successors and assigns (including, without
limitation, any company into or with which the Company may merge or
consolidate).  The Company agrees that it will not effect the sale or other
disposition of all or substantially all of its assets unless either (i) the
person or entity acquiring the assets or a substantial portion of the assets
shall expressly assume by an instrument in writing all duties and obligations of
the Company under this Agreement, or (ii) the Company shall provide, through the
establishment of a separate reserve for the payment in full of all amounts which
are, or may reasonably be expected to become, payable to the Employee under this
Agreement.

     11.  Indemnity and Releases.  In consideration for the cash payment
provided in paragraph 1 above, the Employee releases and discharges the
Employer, its officers, agents, employees, subsidiaries, and successors, from
all claims of any kind, which the Employee, or the Employee's agents, executors,
heirs, or assigns ever had or now have, whether known or unknown, up to and
including the date this Agreement is signed.  This release includes, but is not
limited to, the following:  any action or cause of action asserted or which
could have been asserted under the Age Discrimination in Employment Act of 1967,
as amended, Title VII of the Civil Rights Act of 1964, all state statutes
related to discrimination, the Employee Retirement Income Security Act or the
Americans With Disabilities Act; claims for wrongful discharge, unjust
dismissal, or constructive discharge; claims for breach of any alleged oral,
written or implied contract of employment; claims for salary or severance
payments not provided by this Agreement; claims for benefits; claims for
attorneys fees; and any other claims under any federal, state or local statute,
law, rule or regulation; provided that in any event all such actions or claims
relate to employment or benefits matters.


     IN EXECUTING THIS AGREEMENT, THE EMPLOYEE ACKNOWLEDGES THAT EMPLOYEE HAS
BEEN GIVEN AT LEAST TWENTY-ONE (21) DAYS IN WHICH TO CONSIDER SIGNING THIS
AGREEMENT AND THE RELEASE CONTAINED IN THIS PARAGRAPH 2.  EMPLOYEE ACKNOWLEDGES
THE OPPORTUNITY TO CONSULT WITH AN ATTORNEY OF EMPLOYEE'S CHOICE CONCERNING THIS
AGREEMENT AND RELEASE.  EMPLOYEE HAS CAREFULLY READ AND FULLY UNDERSTOOD ALL THE
PROVISIONS OF THIS AGREEMENT AND RELEASE, AND IS ENTERING INTO THIS AGREEMENT
AND RELEASE VOLUNTARILY.  EMPLOYEE ACKNOWLEDGES THAT THE CONSIDERATION BEING
RECEIVED IN EXCHANGE FOR EXECUTING THIS AGREEMENT AND RELEASE IS GREATER THAN
THAT WHICH EMPLOYEE WOULD BE ENTITLED TO IN THE ABSENCE OF THIS AGREEMENT AND
RELEASE.  EMPLOYEE HAS NOT RELIED UPON ANY REPRESENTATION OR STATEMENT, WRITTEN
OR ORAL, NOT SET FORTH IN THIS DOCUMENT. EMPLOYEE ACKNOWLEDGES THAT THIS
DOCUMENT SETS FORTH THE ENTIRE AGREEMENT WITH THE EMPLOYER AND THAT IT MAY NOT
BE CHANGED ORALLY.  EMPLOYEE HAS THE RIGHT TO REVOKE THIS AGREEMENT WITHIN SEVEN
(7) DAYS OF SIGNING IT, AND THAT THIS AGREEMENT SHALL NOT BECOME EFFECTIVE OR
ENFORCEABLE UNTIL THIS SEVEN DAY PERIOD HAS EXPIRED.
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     12.  Term.  This Agreement shall be effective as of the date first above
written and shall remain in effect until terminated by written agreement of both
parties.  In the event of a Change of control during the term of this Agreement,
this Agreement shall remain in effect for the Covered Period.


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


                          ROCHESTER GAS AND ELECTRIC CORPORATION



                          By:       ROGER  W. KOBER
                              ---------------------------
                                    Roger W. Kober
                               Its Chairman, Pres. & CEO



                          By:         J. B. STOKES
                               ---------------------------
                                        Employee