UNITED STATES SECURITIES AND EXCHANGE COMMISSION

			     Washington, D.C. 20549



				    FORM 10-Q



	     [X]  QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
		  OF THE SECURITIES EXCHANGE ACT OF 1934


		For the quarterly period ended June 30, 1998


				       OR


	     [ ]  TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
		  OF THE SECURITIES EXCHANGE ACT OF 1934


	       Exact name of Registrants as specified in
	       their charters, State of Incorporation,       IRS Employer
Commission     address of principal executive offices and    Identification
File Number    Registrants' telephone number                 Number
-----------    ------------------------------------------    --------------
333-52397      ESI Tractebel Acquisition Corp.               65-0827005
	       (a Delaware corporation)
333-52397-01   Northeast Energy, LP                          65-0811248
	       (a Delaware limited partnership)
	       ------------------------------------------
	       c/o FPL Energy, Inc.
	       700 Universe Boulevard
	       Juno Beach, Florida 33408-2683
	       (561) 691-7171

Indicate by check mark whether the registrants (1) have filed all reports 
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 
1934 during the preceding 12 months and (2) have been subject to such filing 
requirements for the past 90 days.    Yes           No _X_

		      ----------------------------------

This combined Form 10-Q represents separate filings by ESI Tractebel 
Acquisition Corp. and Northeast Energy, LP.  Information contained herein 
relating to an individual registrant is filed by that registrant on its own 
behalf. Each registrant makes representations only as to itself and makes no 
other representations whatsoever as to any other registrant.



SAFE HARBOR STATEMENT UNDER THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 
1995


In connection with the safe harbor provisions of the Private Securities 
Litigation Reform Act of 1995 (Reform Act), ESI Tractebel Acquisition Corp. 
(the Company) and Northeast Energy, LP (NE LP) are hereby filing cautionary 
statements identifying important factors that could cause the Company and 
NE LP's actual results to differ materially from those projected in forward-
looking statements (as such term is defined in the Reform Act) of the Company 
and NE LP made by or on behalf of the Company and NE LP which are made in 
this combined Form 10-Q, in presentations, in response to questions or 
otherwise. Any statements that express, or involve discussions as to, 
expectations, beliefs, plans, objectives, assumptions or future events or 
performance (often, but not always, through the use of words or phrases such 
as will likely result, are expected to, will continue, is anticipated, 
estimated, projection, outlook) are not statements of historical facts and 
may be forward-looking. Forward-looking statements involve estimates, 
assumptions and uncertainties that could cause actual results to differ 
materially from those expressed in the forward-looking statements. 
Accordingly, any such statements are qualified in their entirety by reference 
to, and are accompanied by, the following important factors that could cause 
the Company and NE LP's actual results to differ materially from those 
contained in forward-looking statements of the Company and NE LP made by or 
on behalf of the Company and NE LP.

Any forward-looking statement speaks only as of the date on which such 
statement is made, and the Company and NE LP undertake no obligation to 
update any forward-looking statement or statements to reflect events or 
circumstances after the date on which such statement is made or to reflect 
the occurrence of unanticipated events. New factors emerge from time to time 
and it is not possible for management to predict all of such factors, nor can 
it assess the impact of each such factor on the business or the extent to 
which any factor, or combination of factors, may cause actual results to 
differ materially from those contained in any forward-looking statements.

Some important factors that could cause actual results or outcomes to differ 
materially from those discussed in the forward-looking statements include 
prevailing governmental policies and regulatory actions with respect to 
allowed rates of return, industry and rate structure, acquisition and 
disposal of assets and facilities, operation and construction of plant 
facilities, recovery of fuel and purchased power costs, and present or 
prospective competition.

The business and profitability of the Company and NE LP are also influenced 
by economic and geographic factors including political and economic risks, 
changes in and compliance with environmental and safety laws and policies, 
weather conditions, population growth rates and demographic patterns, 
competition for retail and wholesale customers, pricing and transportation of 
commodities, market demand for energy from plants or facilities, changes in 
tax rates or policies or in rates of inflation, unanticipated development 
project delays or changes in project costs, unanticipated changes in 
operating expenses and capital expenditures, capital market conditions, 
competition for new energy development opportunities, legal and 
administrative proceedings (whether civil, such as environmental, or 
criminal) and settlements, and any unanticipated impact of the year 2000, 
including delays or changes in costs of year 2000 compliance, or the failure 
of major suppliers, customers and others with whom the Company and NE LP do 
business to resolve their own year 2000 issues on a timely basis.

All such factors are difficult to predict, contain uncertainties which may 
materially affect actual results, and are beyond the control of the Company 
and NE LP.

PART I - FINANCIAL INFORMATION

Item 1.  Financial Statements

ESI TRACTEBEL ACQUISITION CORP.
BALANCE SHEET
(Thousands of Dollars)
(Unaudited)

<TABLE>
<CAPTION>
													June 30,
													  1998   
<S>                                                                                                     <C>
ASSETS
Due from NE LP ....................................................................................     $    152
Note receivable from NE LP ........................................................................      220,000

TOTAL ASSETS ......................................................................................     $220,152


LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
  Income taxes payable ............................................................................     $      2

Deferred credit - interest rate hedge .............................................................          147
Securities payable ................................................................................      220,000

Stockholders' equity:
  Common stock, $.01 par value, 100 shares authorized, 20 shares issued ...........................            -
  Subscriptions receivable ........................................................................            -
  Retained earnings ...............................................................................            3

COMMITMENTS AND CONTINGENCIES

TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY ........................................................     $220,152

</TABLE>


The accompanying notes are an integral part of these financial statements.


ESI TRACTEBEL ACQUISITION CORP.
STATEMENT OF OPERATIONS
(Thousands of Dollars)
(Unaudited)

<TABLE>
<CAPTION>

													 Period
											 Three            From
											 Months        January 12,
											 Ended           1998 to
											June 30,        June 30,
											  1998            1998   
<S>                                                                                     <C>             <C>
Interest income ....................................................................    $  4,342        $  6,396
Interest expense ...................................................................      (4,340)         (6,391)
Income before income taxes .........................................................           2               5
Income tax expense .................................................................           -              (2)

NET INCOME .........................................................................    $      2        $      3

</TABLE>


The accompanying notes are an integral part of these financial statements.

ESI TRACTEBEL ACQUISITION CORP.
STATEMENT OF CASH FLOWS
(Thousands of Dollars)
(Unaudited)

<TABLE>
<CAPTION>
													 Period
													  From
												       January 12,
													 1998 to
													June 30,
													  1998    
<S>                                                                                                     <C>
NET CASH PROVIDED BY OPERATING ACTIVITIES ..........................................................    $       -

CASH FLOWS FROM INVESTING ACTIVITIES:
  Loan to NE LP ....................................................................................     (215,202)
    Net cash used in investing activities ..........................................................     (215,202)

CASH FLOWS FROM FINANCING ACTIVITIES:
  Issuance of debt securities ......................................................................      215,050
  Proceeds from interest rate hedge ................................................................          152
    Net cash provided by financing activities ......................................................      215,202

Net increase in cash ...............................................................................            -
Cash at beginning of period ........................................................................            -
Cash at end of period ..............................................................................    $       -

Supplemental disclosure of cash flow information:
  Cash paid for interest ...........................................................................    $   6,396

</TABLE>


The accompanying notes are an integral part of these financial statements.

NORTHEAST ENERGY, LP
CONSOLIDATED BALANCE SHEETS
(Thousands of Dollars)
(Unaudited)

<TABLE>
<CAPTION>
										     June 30,      December 31,
										       1998            1997     
<S>                                                                                 <C>            <C>
ASSETS
Current assets:
  Cash and cash equivalents ....................................................    $  27,352                 -
  Accounts receivable ..........................................................       36,657                 -
  Fuel inventories .............................................................        3,413                 -
  Prepaid expenses and other current assets.....................................          802                 -
    Total current assets .......................................................       68,224                 -

Non-current assets:
  Deferred debt issuance costs - net ...........................................        6,438                 -
  Cogeneration facilities and carbon dioxide facility (net of accumulated
    depreciation of $10,123) ...................................................      502,928                 -
  Power purchase contracts (net of accumulated amortization of $23,394) ........      865,362                 -
  Other assets .................................................................          123                 -
    Total non-current assets ...................................................    1,374,851                 -

TOTAL ASSETS ...................................................................   $1,443,075                 -


LIABILITIES AND PARTNERS' EQUITY
Current liabilities:
  Current portion of notes payable - ESI Tractebel Funding Corp. ...............   $   22,537                 -
  Accounts payable .............................................................       14,587                 -
  Due to related parties .......................................................        2,661                 -
  Other accrued expenses .......................................................        5,846                 -
    Total current liabilities ..................................................       45,631                 -

Non-current liabilities:
  Deferred credit - O&M and fuel contracts .....................................      340,418                 -
  Notes payable - ESI Tractebel Funding Corp. ..................................      456,968                 -
  Note payable - ESI Tractebel Acquisition Corp. ...............................      220,000                 -
  Amounts due utilities for energy bank balances ...............................      172,649                 -
    Total non-current liabilities ..............................................    1,190,035                 -

Partners' equity:
  General partners .............................................................        4,147                 -
  Limited partners .............................................................      203,262                 -
    Total partners' equity .....................................................      207,409                 -

COMMITMENTS AND CONTINGENCIES

TOTAL LIABILITIES AND PARTNERS' EQUITY .........................................   $1,443,075                 -

</TABLE>


The accompanying notes are an integral part of these consolidated financial 
statements.


NORTHEAST ENERGY, LP
CONSOLIDATED STATEMENT OF OPERATIONS
(Thousands of Dollars)
(Unaudited)

<TABLE>
<CAPTION>
											 Three            Six
											 Months          Months
											 Ended           Ended
											June 30,        June 30,
											  1998            1998   
<S>                                                                                     <C>             <C>
REVENUES .........................................................................      $ 66,458        $141,197

COSTS AND EXPENSES:
  Fuel ...........................................................................        27,637          57,154
  Operation and maintenance ......................................................         3,890           8,628
  Depreciation and amortization ..................................................        18,024          33,532
  General and administrative .....................................................         2,194           4,362
    Total costs and expenses .....................................................        51,745         103,676

OPERATING INCOME .................................................................        14,713          37,521

OTHER EXPENSE (INCOME):
  Amortization of debt issue costs ...............................................           153             225
  Interest expense ...............................................................        20,297          36,060
  Interest income ................................................................          (857)         (1,510)
    Total other expense - net ....................................................        19,593          34,775

NET INCOME (LOSS) ................................................................      $ (4,880)      $   2,746

</TABLE>


The accompanying notes are an integral part of these consolidated financial 
statements.


NORTHEAST ENERGY, LP
CONSOLIDATED STATEMENT OF CASH FLOWS
(Thousands of Dollars)
(Unaudited)

<TABLE>
<CAPTION>
													  Six
													 Months
													 Ended
													June 30,
													  1998   
<S>                                                                                                    <C>
NET CASH PROVIDED BY OPERATING ACTIVITIES ........................................................     $  32,250

CASH FLOWS FROM INVESTING ACTIVITIES:
  Acquisition purchase price, net of $62,635 cash acquired .......................................      (483,140)
    Net cash used in investing activities ........................................................      (483,140)

CASH FLOWS FROM FINANCING ACTIVITIES:
  Capital contributions from partners ............................................................       535,412
  Principal payment on ESI Tractebel Funding Corp. notes .........................................       (10,782)
  Release of restricted cash collateral ..........................................................        69,156
  Proceeds from loan by the Company ..............................................................       215,202
  Distributions to partners ......................................................................      (330,746)
    Net cash provided by financing activities ....................................................       478,242

Net increase in cash and cash equivalents ........................................................        27,352
Cash and cash equivalents at beginning of period .................................................             -
Cash and cash equivalents at end of period .......................................................     $  27,352

Supplemental disclosure of cash flow information:
  Cash paid for interest .........................................................................     $  29,711


</TABLE>


The accompanying notes are an integral part of these consolidated financial 
statements.

ESI TRACTEBEL ACQUISITION CORP.
NOTES TO FINANCIAL STATEMENTS
(Unaudited)

In the opinion of management of the Company, all adjustments (consisting of 
normal recurring accruals) considered necessary for fair financial statement 
presentation have been made. The results of operations for an interim period 
may not give a true indication of results for the year.

1.  Nature of Business

The Company, a Delaware corporation, was formed on January 12, 1998 as a 
special purpose funding corporation for the purpose of issuing the securities 
described in Note 3. The Company's common stock is jointly owned by ESI 
Northeast Energy Acquisition Funding, Inc. (ESI NE Acquisition Funding), a 
wholly-owned subsidiary of ESI Energy, Inc. (ESI Energy), and Tractebel 
Power, Inc. (Tractebel Power). The Company acts as agent of NE LP with 
respect to the securities and holds itself out as agent of NE LP in all 
dealings with third parties relating to the securities.

NE LP, a Delaware limited partnership, was formed on November 21, 1997 for 
the purpose of acquiring ownership interests in electric power generation 
stations and is jointly owned by subsidiaries of ESI Energy and Tractebel 
Power. ESI Energy is wholly-owned by FPL Energy, Inc. which is an indirect 
wholly-owned subsidiary of FPL Group, Inc., a New York Stock Exchange 
company. Tractebel Power is a direct wholly-owned subsidiary of Tractebel, 
Inc. which is a direct wholly-owned subsidiary of Tractebel, S.A., a Belgian 
energy and environmental services business. NE LP also formed a wholly-owned 
entity, Northeast Energy, LLC (NE LLC, and together with NE LP, the Partners 
) to assist in such acquisitions.

On January 14, 1998, the Partners purchased all of the interests in two 
existing limited partnerships, Northeast Energy Associates, A Limited 
Partnership (NEA) and North Jersey Energy Associates, A Limited Partnership 
(NJEA, and together with NEA, the Partnerships).

2.  Summary of Significant Accounting Policies

Use of Estimates - The preparation of financial statements in conformity with 
generally accepted accounting principles requires estimates and assumptions 
that affect the reported amounts of assets and liabilities, the disclosure of 
contingent assets and liabilities at the date of the financial statements and 
the reported amounts of revenues and expenses during the reporting period. 
Actual results could differ from those estimates.

3.  The Securities

On February 12, 1998, the Company issued $220,000,000 of 7.99% Secured Bonds 
Due 2011 to qualified institutional buyers as defined in Rule 144A of the 
Securities Act of 1933 (Rule 144A). Borrowings outstanding at June 30, 1998 
were $220,000,000.

The Company has filed a Registration Statement on Form S-4 with the 
Securities and Exchange Commission for purposes of effecting a public 
exchange offer whereby the securities (Old Securities) described above may be 
exchanged for a new issue of securities which are registered under the 
Securities Act of 1933 (the New Securities and together with the Old 
Securities, the Securities). The New Securities will have terms substantially 
identical to the Old Securities. The exchange offer became effective August 
12, 1998 and expires on September 14, 1998 unless extended by the Company.

Interest on the Securities is payable semiannually on each June 30 and 
December 30. Principal repayments will be made annually commencing on June 
30, 2002 and are in amounts stipulated in the trust indenture relating to the 
Securities. Future principal payments are as follows:

Year ending December 31:
2002 .................................................. $  8,800,000
Thereafter ............................................ $211,200,000

The Securities are subject to optional redemption after June 30, 2008 at the 
redemption prices set forth in the trust indenture and are subject to 
extraordinary mandatory redemption at a redemption price of 100% of the 
principal amount thereof in certain limited circumstances as defined in the 
trust indenture.

The proceeds from the sale of the Old Securities were loaned to NE LP, 
evidenced by a promissory note (the Note) with substantially identical terms 
as the Old Securities, for the purpose of reimbursing certain of the partners 
of NE LP for a portion of the original $545 million equity contribution that 
was used to finance the cost of the acquisitions. The Securities are 
unconditionally guaranteed by NE LP.

The Securities are payable solely from payments to be made by NE LP under the 
Note and the guarantee. NE LP's obligations to make payments under the Note 
are nonrecourse to the direct and indirect owners of NE LP.

Payments with respect to the Note and, therefore, in respect of the 
Securities will be effectively subordinated to payment of all indebtedness 
and other liabilities and commitments (including trade payables and lease 
obligations) of the Partnerships, including the guarantee by the Partnerships 
of its indebtedness.

Repayment of the Securities is guaranteed by all interest in the 
Partnerships. The Securities will rank senior to all subordinated 
indebtedness and rank evenly with all senior indebtedness that the Company 
incurs in the future.

4.  Financial Instruments

In January 1998, the Company entered into a fixed interest rate hedge to 
hedge its exposure to fluctuations in the interest rate associated with the 
placement of the Old Securities. The financial instrument was settled on 
February 17, 1998 and qualified for hedge accounting. The gain resulting from 
the hedge was $151,582 and is being amortized into income using the effective 
interest method.

The Company controls the credit risk arising from these instruments through 
credit approvals, limits and monitoring. The Company does not normally 
require collateral or other security to support financial instruments with 
credit risks.


NORTHEAST ENERGY, LP
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)

In the opinion of management of NE LP, all adjustments (consisting of normal 
recurring accruals) considered necessary for fair financial statement 
presentation have been made. The results of operations for an interim period 
may not give a true indication of results for the year.

1.  Nature of Business

NE LP, a Delaware limited partnership, was formed on November 21, 1997 for 
the purpose of acquiring ownership interests in electric power generation 
stations, and is jointly owned by subsidiaries of ESI Energy and Tractebel 
Power. ESI Energy is wholly-owned by FPL Energy, Inc. which is an indirect 
wholly-owned subsidiary of FPL Group, Inc., a New York Stock Exchange 
company. Tractebel Power is a direct wholly-owned subsidiary of Tractebel, 
Inc. which is a direct wholly-owned subsidiary of Tractebel, S.A., a Belgian 
energy and environmental services business. NE LP also formed a wholly-owned 
entity, Northeast Energy, LLC to assist in such acquisitions. NE LP had no 
financial activity prior to December 31, 1997.

On January 14, 1998, the Partners purchased all of the interests in the 
Partnerships. NE LP holds a one percent (1%) general partner and ninety-eight 
percent (98%) limited partner interest in the Partnerships; NE LLC holds the 
remaining one percent (1%) limited partner interest. See Note 2 - 
Acquisitions for additional information relating to the acquisitions.

The Partnerships were formed in 1986 to develop, finance, construct, own, 
manage and operate two separate 300 megawatt (MW) natural gas-fired combined-
cycle cogeneration facilities. NEA's facility is located in Bellingham, 
Massachusetts and NJEA's facility is located in Sayreville, New Jersey. NEA 
commenced commercial operation in September 1991 and NJEA commenced 
commercial operation in August 1991. The Partnerships operate in the 
independent power industry and have been granted permission by the Federal 
Energy Regulatory Commission to operate as qualifying facilities defined in 
the Public Utility Regulatory Policies Act of 1978, as amended and as defined 
in federal regulations.

In connection with the acquisition of the Partnerships' interests, an 
existing special purpose funding corporation was acquired and its name 
changed from IEC Funding Corp. to ESI Tractebel Funding Corp. This entity 
previously issued debt which was registered with the Securities and Exchange 
Commission in an exchange offer. Repayment of this debt is secured by the 
assets of the Partnerships.

Additionally, as a means of funding portions of the purchase price of the 
acquisition of the Partnerships, the Company was formed. On February 12, 1998 
the Company issued the Old Securities and loaned the proceeds to NE LP. The 
proceeds were then distributed to ESI Energy and Tractebel Power. Repayment 
of the Securities is expected from distributions from the Partnerships and is 
guaranteed by all interests in the Partnerships. See Note 4 for additional 
information.

The Partners share profits and losses and have interests in assets and 
liabilities and cash flows in proportion to their tax basis capital accounts. 
Distributions to the Partners may be made only after all required funds and 
sub-funds of the Partnerships have been fully funded, as described in the 
trust indenture.

2.  Summary of Significant Accounting Policies

Basis of Presentation - The accompanying consolidated financial statements 
include the accounts of the Partnerships subsequent to the acquisitions, as 
they are indirectly wholly-owned by NE LP. All material intercompany 
transactions have been eliminated in consolidation.

Acquisitions - On January 14, 1998, the Partners acquired all of the 
interests in the Partnerships for $545 million, including approximately $10 
million of acquisition costs (the Acquisitions). The Acquisitions were 
accounted for using the purchase method of accounting. The purchase price has 
been allocated based on fair value to the net assets of the Partnerships.

The following is a summary of the assets acquired and liabilities assumed in 
the Acquisitions based on a preliminary allocation of the purchase price 
(thousands of dollars):

Assets:
Current assets ........................................ $114,286
Restricted cash ....................................... $ 69,156
Cogeneration facilities and carbon dioxide facility.... $512,059
Power purchase contracts .............................. $888,756
Other assets .......................................... $    127

Liabilities:
Current liabilities ................................... $ 47,031
Operation and maintenance (O&M) contracts ............. $ 18,749
Fuel contracts ........................................ $333,544
Energy bank balances .................................. $171,530
Notes payable ......................................... $468,724

Carrying values of current assets, restricted cash and current liabilities 
were considered to closely approximate fair value and were not adjusted. 
Power purchase contracts were assigned a value based on the estimated amount 
to be received over the contract period in excess of an independent 
appraiser's assessment of market rates for power, discounted to the date of 
acquisition. The cogeneration facilities and carbon dioxide facility were 
initially assigned value based on an assessment of current replacement cost 
for similar capacity, without the acquired power purchase agreements. In 
accordance with Accounting Principles Board Opinion No. 16, the values 
assigned to these long-lived assets were reduced by the net excess of the 
fair values of all assets acquired over the purchase price. O&M and fuel 
contract obligations were determined based on expected cash flows during 
contract periods compared to estimated cash flows for similar services if 
contracted for currently, discounted to the date of acquisition. Notes 
payable include the previously-existing debt of the Partnerships that was 
considered to approximate market value. Energy bank balances were assigned a 
value representing the estimated present value of future payments to 
utilities in connection with certain existing power purchase agreements.

The following unaudited pro forma information has been prepared assuming that 
the Acquisitions and the issuance of the Old Securities described in Note 1 had 
occurred at the beginning of the period presented (thousands of dollars):

							  Six
							 Months
							 Ended
							June 30,
							  1998   

Revenues .............................................. $154,306
Operating income ...................................... $ 41,799
Net income ............................................ $  2,343

Cash and Cash Equivalents - Investments purchased with an original maturity 
of three months or less are considered cash equivalents. Excess cash is 
invested in high-grade money market accounts and commercial paper and are 
subject to minimal credit and market risk. At June 30, 1998, the recorded 
amount of cash approximates its fair value.

Accounts Receivable and Revenue - Accounts receivable primarily consist of 
receivables from three Massachusetts utilities and one New Jersey utility for 
electricity delivered and sold under six power purchase agreements. Prices 
are based on initial floor prices per kilowatt hour (kWh), subject to 
adjustment based on actual volumes of electricity purchased, escalation 
factors and other conditions. Revenue is recognized in accordance with the 
Emerging Issues Task Force Issue No. 91-6, Revenue Recognition of Long-Term 
Power Sales Contracts. Revenue is recognized based on power delivered at 
rates stipulated in power purchase agreements, except that revenue is 
deferred to the extent that stipulated rates are in excess of amounts, either 
scheduled or specified, in the agreements to the extent the Partnerships have 
an obligation to repay such excess. The amount deferred is reflected as 
amounts due utilities for energy bank balances on the consolidated balance 
sheet. Revenue from steam sales is recognized upon delivery.

Cogeneration Facilities, Carbon Dioxide Facility and Other Assets - Effective 
January 14, 1998, all facilities were revalued as a result of applying the 
purchase method of accounting mentioned above. The facilities and other fixed 
assets are depreciated using the straight-line method over the estimated 
useful life of 34 years.

Major Maintenance - Effective January 14, 1998, maintenance expenses are 
accrued for certain identified major maintenance and repair items related to 
the Partnerships' facilities. The expenses are accrued ratably over each 
major maintenance cycle. The amounts accrued relate to maintenance costs 
required for the equipment to operate over its depreciable life.

Inventories - Inventories consist of natural gas and fuel oil and are stated 
at the lower of cost, determined on a first in, first out (FIFO) basis, or 
market.

Power Purchase Contracts - Effective January 14, 1998, power purchase 
contracts which were determined to be in excess of prevailing rates for 
similar contracts were adjusted as a result of applying the purchase method 
of accounting mentioned above. These contracts are being amortized over 
contract periods, ranging from 14 to 24 years, on a straight-line basis or 
matched to scheduled fixed-price increases under the power purchase 
agreements, as applicable.

O&M Contracts - Effective January 14, 1998, O&M contracts which were 
determined to be in excess of prevailing rates for similar contracts were 
adjusted as a result of applying the purchase method of accounting mentioned 
above. The O&M contracts are being amortized on a straight-line basis over 
the remaining terms of the contracts, 4 years.

Fuel Contracts - Effective January 14, 1998, fuel contracts which were 
determined to be in excess of prevailing rates for similar contracts were 
adjusted as a result of applying the purchase method of accounting mentioned 
above. The fuel contracts are being amortized on a straight-line basis over 
the remaining terms of the contracts, 16 years.

Amounts Due Utilities for Energy Bank Balances - Effective January 14, 1998, 
amounts due utilities for energy bank balances were adjusted to the present 
value of estimated future payments.

Interest Rate Swaps - Interest rate swaps that do not qualify for hedge 
accounting are recorded at fair value, with changes in the fair value 
recognized currently in income. See Note 6 for further disclosure regarding 
interest rate swap agreements.

Natural Gas Hedging Instrument - Premiums paid for natural gas call options 
are deferred and recognized in income in conjunction with the underlying 
natural gas purchases. Gains and losses on natural gas purchase swap 
agreements are recognized as adjustments to fuel costs at monthly settlement 
dates. Purchases of natural gas under forward purchase agreements are 
accounted for as fuel costs at their contract price at delivery. The net gain 
included in fuel costs resulting from the gas purchase options, swap 
agreements and forward purchases was $1.2 million for both the three and six 
month periods ended June 30, 1998. See Note 6 for further disclosure 
regarding natural gas hedging instruments.

Deferred Debt Issuance Costs - Deferred debt issuance costs are being 
amortized over the approximate 14-year term of the note payable using the 
interest method.

Income Taxes - Partnerships are not taxable entities for Federal and state 
income tax purposes. As such, no provision has been made for income taxes 
since such taxes, if any, are the responsibilities of the individual 
partners.

Use of Estimates - The preparation of financial statements in conformity with 
generally accepted accounting principles requires estimates and assumptions 
that affect the reported amounts of assets and liabilities, the disclosure of 
contingent assets and liabilities at the date of the financial statements and 
the reported amounts of revenues and expenses during the reporting period. 
Actual results could differ from those estimates.

3.  Cogeneration Facilities, Power Purchase Agreements and Carbon Dioxide 
Facility

Cogeneration Facilities - The cogeneration facilities have maximum output 
capacities of any combination of electricity and steam equivalent to 
approximately 600 MW in the aggregate.

Power Purchase Agreements - In 1986, NEA entered into five power purchase 
agreements with three Massachusetts utilities to sell approximately 290 MW at 
initial floor prices per kWh subject to adjustment based on actual volumes 
purchased, escalation factors, and other conditions. Performance under 
certain of these agreements is secured by a second mortgage on the NEA 
facility. In 1987, NJEA entered into an agreement with a New Jersey utility 
to sell 250 MW at an initial fixed price per kWh subject to adjustments, as 
defined in the agreement. These power purchase agreements have initial terms 
ranging from 20 to 30 years. All of the Partnerships' power sales to 
utilities are generated through these arrangements. As such, the Partnerships 
are directly affected by changes in the power generation industry. 
Substantially all of the Partnerships' accounts receivable are with utilities 
located in the Northeast portion of the United States. The Partnerships do 
not require collateral or other security to support their receivables. 
However, management does not believe significant credit risk exists at June 
30, 1998. During the six month period ended June 30, 1998, revenue from two 
different utilities accounted for approximately 47.8% and 39.3% of power 
sales to utilities.

On November 25, 1997, the Massachusetts legislature passed a comprehensive 
electric deregulation bill to establish a comprehensive framework for the 
restructuring of the electric utility industry. Industry efforts are also 
underway in New Jersey. While the Partnerships do not expect electric utility 
industry restructuring to result in material adverse changes to the 
Partnerships' power purchase agreements, the impact of electric utility 
industry restructuring on the companies that purchase power from the 
Partnerships is uncertain.

Energy Bank Balances - Certain agreements require the establishment of energy 
banks to record cumulative payments made by the utilities in excess of 
avoided cost rates scheduled or specified in such agreements. One of the 
resulting energy banks is non-interest bearing; however, the remaining energy 
banks bear interest at various rates specified in the agreements. Amounts 
recorded in two of the energy banks will be required to be repaid to the 
extent that, in later periods, power purchase agreement avoided costs are 
above the contract rate. The balances of two energy banks are secured by the 
NEA second mortgage and letters of credit have been established for two other 
energy banks (see Note 7).

Steam Sales Agreements and Carbon Dioxide Facility - In order for the 
Partnerships' facilities to maintain qualifying facility status, the 
facilities are required to generate five percent of total energy output as 
steam for sale to unrelated third parties. In 1990, NEA entered into an 
amended and restated NEA steam sales agreement with a processor and seller of 
carbon dioxide. The amended and restated NEA steam sales agreement extends 
for the same terms as the carbon dioxide facility's lease, with automatic 
extension for any renewal period under the carbon dioxide facility's lease. 
Pursuant to the steam sales agreement, NEA sells all the steam generated by 
the NEA facility at a price that fluctuates based on changes in the price of 
a specified grade of fuel oil.

In conjunction with this contract, NEA constructed the carbon dioxide 
facility and, in 1989, entered into a 16-year agreement to lease the facility 
to the steam user. Base rent under the lease is $100,000 per month, adjusted 
by the operating results of the facility as outlined in the lease agreement. 
Additionally, NEA pays the steam user $100,000 annually for administrative 
services rendered related to the operation of the carbon dioxide facility.

In 1989, NJEA entered into a 20-year steam sales contract with a steam user 
adjacent to the NJEA facility. Under this agreement, NJEA sells a specified 
maximum quantity of steam at a floor price that can increase based on changes 
in prices of coal. This agreement automatically renews for two consecutive 
five-year terms unless either party gives notice not to renew two years 
before the expiration of each of the prior terms.

Fuel Supply, Transportation and Storage Agreements - Natural gas is provided 
to the NEA and NJEA facilities primarily under long-term contracts for 
supply, transportation and storage. The remaining fuel requirements are 
provided under short-term spot arrangements. The long-term natural gas supply 
is provided under contracts with ProGas Limited (ProGas) and Public Service 
Electric and Gas Company (PSE&G). Various pipeline companies provide 
transportation of the natural gas. Gas storage agreements provide contractual 
arrangements for the storage of limited volumes of natural gas with third 
parties for future delivery to the Partnerships.

The ProGas contracts commenced in 1991, and the initial 15-year terms were 
extended an additional seven years effective in 1994. The maximum total 
volumes of gas to be delivered under the ProGas contracts are approximately 
48,800 and 22,000 millions of British thermal units (MMBtu) per day for NEA 
and NJEA, respectively. The contract price, including transportation, of the 
ProGas supply delivered to the import point is determined with reference to a 
base price in 1990, re-determined annually thereafter based on specified 
inflation indices. The PSE&G contract commenced in 1991, and provides for the 
sale and delivery to NJEA of up to 25,000 MMBtu per day of gas for a term of 
20 years. The contract price of the PSE&G gas is established monthly using a 
contractually specified mechanism.

With the exception of the PSE&G arrangement, all of the Partnerships' long-
term contractual arrangements call for monthly demand charge payments. These 
demand charge payments reserve certain pipeline transportation capacity and 
are made regardless of the Partnerships' specified fuel requirements in any 
month and regardless of whether the Partnerships utilize the capacity 
reserved. These demand charges totaled approximately $10.9 million and $21.6 
million for the three and six month periods ended June 30, 1998, 
respectively. In the event the available capacity under these agreements is 
not utilized by the operations of the facilities, the Partnerships have the 
opportunity under certain of these contractual agreements to sell unused 
capacity to third parties, but have not yet done so.

NEA's facility also has the capability to burn #2 fuel oil. Fuel oil is 
stored on site for contingency supply.

4.  Loans Payable

In 1994, the Partnerships refinanced their existing borrowings by means of a 
placement of securities to qualified institutional buyers as defined in Rule 
144A . In 1995, ESI Tractebel Funding Corp. (formerly IEC Funding Corp.) 
filed a Registration Statement on Form S-4 with the Securities and Exchange 
Commission for purposes of effecting a public exchange offer whereby the 
securities mentioned above were exchanged for a new issue of securities (the 
Funding Corp. Securities). The Funding Corp. Securities have terms identical 
to the securities issued in accordance with Rule 144A. Interest rates on the 
Funding Corp. Securities range from 8.43% to 9.77% with final maturity dates 
ranging from 2000 to 2010.

Interest on the Funding Corp. Securities is payable semiannually on each June 
30 and December 30. Principal repayments are made semiannually in amounts 
stipulated in the trust indenture. Future principal payments are as follows:

Year ending December 31:
1998 ......... ........................................ $ 10,781,000
1999 .................................................. $ 23,511,000
2000 .................................................. $ 26,333,000
2001 .................................................. $ 20,160,000
2002 .................................................. $ 22,688,000
Thereafter ............................................ $376,032,000

The Funding Corp. Securities are not subject to optional redemption but are 
subject to mandatory redemption in certain limited circumstances involving 
the occurrence of an event of loss, as defined in the trust indenture, for 
which the Partnerships fail to or are unable to restore a facility. The 
Funding Corp. Securities are unconditionally guaranteed, jointly and 
severally, by the Partnerships.

The proceeds from the sale of the Funding Corp. Securities were used to 
purchase the notes outstanding under the original loan and credit agreements 
and to make loans to the Partnerships. In connection with these two 
transactions, the notes outstanding under the loan and credit agreements were 
surrendered and new notes of the Partnership were issued to ESI Tractebel 
Funding Corp. (formerly IEC Funding Corp.) in an aggregate principal amount 
equal to the aggregate principal amount of the Funding Corp. Securities (the 
Funding Corp. Notes).  The loan and credit agreement was assigned to ESI 
Tractebel Funding Corp. (formerly IEC Funding Corp.) and amended and restated 
(the Amended and Restated Credit Agreement).

Borrowings are secured by a lien on, and a security interest in, 
substantially all of the assets of the Partnerships. Under the Amended and 
Restated Credit Agreement, the Partnerships are jointly and severally 
required to make scheduled payments on the Funding Corp. Notes on dates and 
in amounts identical to the scheduled payments of principal and interest on 
the Funding Corp. Securities. The Funding Corp. Securities, the guarantees 
thereon provided by the Partnerships and the Funding Corp. Notes are 
nonrecourse to the Partners and are payable solely by the Partnerships and 
from the collateral pledged as security.

Under the terms of the trust indenture governing the Funding Corp. 
Securities, the Partnerships are required to establish certain funds and 
subfunds which must be fully funded before any partner distributions can be 
made. Cash within these funds can be drawn currently if funds in the 
Partnerships' other cash accounts are insufficient to meet operational cash 
requirements.

The trust indenture also contains certain restrictions on activities of the 
Partnerships, including incurring additional indebtedness or liens, 
partnership distributions, cancellation of certain agreements, the execution 
of mergers, consolidations and asset sales.

Under the terms of the original loan and credit agreement, the Partnerships 
were required to enter into interest rate swap agreements providing for the 
payments on a notional principal amount to be made by the Partnerships at 
fixed interest rates, in exchange for payments to be made by such financial 
institutions at floating interest rates. The original specified notional 
principal amount declines periodically until the scheduled expiration of the 
swaps in 1999. The Partnerships are jointly and severally liable under these 
agreements. As a result of the refinancing described above, the original 
interest swap agreements no longer qualify for hedge accounting and are 
recorded at fair value. Changes in fair value are recognized in the 
consolidated statement of operations. See Note 6 for information regarding 
fair value of financial instruments.

On February 12, 1998, the Company issued $220,000,000 of 7.99% Secured Bonds 
Due 2011 (the Old Securities). The proceeds were loaned to NE LP and are 
evidenced by the Note with substantially identical terms as the Old 
Securities. The loan was used to reimburse certain ESI Energy and Tractebel 
Power subsidiaries for a portion of the original $545 million equity 
contribution that was used to finance the cost of the Acquisitions. A 
Registration Statement on Form S-4 has been filed with the Securities and 
Exchange Commission for purposes of effecting a public exchange offer whereby 
the Old Securities may be exchanged for New Securities which are registered 
under the Securities Act of 1933. Such New Securities will have substantially 
identical terms as the Old Securities. The exchange offer became effective 
August 12, 1998 and expires on September 14, 1998 unless extended by the 
Company.

Interest on the Securities is payable semiannually on each June 30 and 
December 30. Principal repayments are made annually commencing on June 30, 
2002 and are in amounts stipulated in the trust indenture. Future principal 
payments are as follows:

Year ending December 31:
2002 .................................................. $  8,800,000
Thereafter ............................................ $211,200,000

The Securities are unconditionally guaranteed by NE LP.

The Securities are payable solely from payments to be made by NE LP under the 
Note and bond guaranty and from other moneys that may be available from time 
to time in the accounts held by the trustee and are not obligations of the 
Partnerships. NE LP has a general obligation to make payments under the Note 
and the bond guaranty. NE LP's only source of funds to make such payments is 
distributions from the Partnerships. NE LP's obligations to make payments 
under the Note are non-recourse to the direct and indirect owners of NE LP 
(including ESI Energy and Tractebel Power). Payments with respect to the Note 
and, therefore, in respect of the Securities will be effectively subordinated 
to payment of all indebtedness and other liabilities and commitments 
(including trade payables and lease obligations) of the Partnerships, 
including the guarantee by the Partnerships of the Funding Corp. Securities.

5.  Related Party Information

Administrative Services Agreement - NE LP and an entity related to ESI Energy 
have entered into an Administrative Services Agreement (the Agreement) that 
provides for management and administrative services to the Partnerships. The 
Agreement expires in 2018, provides for fees of a minimum of $600,000 per 
year and reimburses costs and expenses of performing services.

Operation and Maintenance Agreements - NE LP and an entity related to ESI 
Energy have entered into operation and maintenance agreements (the New O&M 
Agreements) that provide for the operation and maintenance of the 
Partnerships on the day following the expiration or early termination of the 
current O&M provider. The New O&M Agreements extend for an initial term until 
January 14, 2016, subject to extension by mutual agreement of the parties 
before six months preceding expiration. The New O&M Agreements reimburse 
costs and expenses of performing services and provide for fees of $750,000 
per year, subject to certain adjustments, for each Partnership.

Fuel Management Agreements - NE LP and an entity related to ESI Energy have 
entered into Fuel Management Agreements (the Fuel Agreements) that provide 
for the management of all natural gas and fuel oil, transportation and 
storage agreements, and the location and purchase of any additional required 
natural gas or fuel oil for the Partnerships. The Fuel Agreements expire in 
2023. The Fuel Agreements provide for fees of a minimum of $450,000 per year 
for each Partnership and reimburse all costs and expenses of performing 
services.

Accrued expenses under the Agreement, the New O&M Agreements, and the Fuel 
Agreements were $.8 million and $1.5 million for the three and six month 
periods ended June 30, 1998, respectively.

Amounts due to general partners and other related parties were $1.4 million 
and $1.3 million at June 30, 1998, respectively. The average balances due to 
related parties did not vary materially from these amounts. During the six 
month period ended June 30, 1998, NE LP received $535.4 million of 
contributions from its partners. During the three and six month periods ended 
June 30, 1998, distributions were made to the partners of approximately $23.1 
million and $330.7 million, respectively.

6.  Financial Instruments

The Partnerships have made use of derivative financial instruments to hedge 
their exposure to fluctuations in both interest rates and the price of 
natural gas.

Under the terms of the original loan and credit agreement, the Partnerships 
were required to enter into fixed interest rate swap agreements as a means of 
managing exposure to the variable rate of interest of the original 
Partnerships' borrowings. In conjunction with the refinancing, the 
Partnerships entered into counter-swap agreements so that the Partnerships 
would no longer be exposed to changes in interest rates.

The prices received by the Partnerships for power sales under their long-term 
contracts do not move precisely in tandem with the prices paid by the 
Partnerships for natural gas. To mitigate the price risk associated with 
purchases of natural gas, the Partnerships may, from time to time, enter into 
certain hedging transactions either through public exchanges or by means of 
over-the-counter transactions with specific counterparties. The Partnerships 
hedge purchases of natural gas through the use of natural gas call options, 
natural gas purchase swap agreements that require the Partnerships to pay a 
fixed price (absolutely or within a specified range) in return for a variable 
price on specified notional quantities of natural gas, and forward purchases 
of natural gas.

The Partnerships control the credit risk arising from these instruments 
through credit approvals, limits, and monitoring. The Partnerships do not 
normally require collateral or other security to support financial 
instruments with credit risks.

7.  Commitments and Contingencies

Energy Bank and Loan Collateral - Subsequent to the Acquisitions on January 
14, 1998, certain credit arrangements were terminated and replaced with new 
letters of credit and a guaranty to satisfy requirements in certain power 
purchase agreements. Specifically, new energy bank letters of credit were 
issued in face amounts of $12,656,000 and $54,000,000. The $12,656,000 letter 
of credit expires on December 31, 1998 and can be drawn upon on one occasion 
in the event that a certain power purchase agreement has terminated at a time 
when there was a positive energy bank balance existing in favor of the power 
purchaser. The $54,000,000 letter of credit expires on December 31, 1998 and 
can be drawn upon in multiple drawings in the event that a certain power 
purchase agreement has terminated at the time when there was a positive 
energy bank balance existing in favor of the power purchaser. A guaranty was 
made by a subsidiary of FPL Group, Inc. in favor of the Partnerships' 
trustee. The guarantor unconditionally and irrevocably guarantees the payment 
of an amount equal to 50% of the debt service reserve requirement with a 
respect to the Funding Corp. Securities. The guaranty expires on December 31, 
1998 but is automatically extended for successive one-year periods unless the 
guarantor gives notice that it will not renew. Once the new credit 
arrangements were in place, cash of approximately $69.2 million (plus 
approximately $2.5 million in accrued interest) was released and distributed 
to the Partners. Additionally, new letters of credit were issued in 
substitution for cash on deposit in Partnership trust accounts and 
approximately $33.2 million in cash was released and distributed to the 
Partners.

Operation and Maintenance of the Cogeneration Facilities - In 1989, the 
Partnerships entered into two separate ten year O&M agreements with an O&M 
provider for an aggregate annual consideration of approximately $11,100,000, 
subject to changes in specified indices. Under these agreements, the 
Partnerships are required to pay the O&M provider a bonus payable annually 
over the term of the agreements based on operating performance. The 
Partnerships incurred $3.3 million and $7.5 million for O&M and bonus 
expenses for the three and six month periods ended June 30, 1998, 
respectively. On November 15, 1997, the O&M provider's parent announced that 
it intended to sell certain of its industrial businesses, including the 
business of the O&M provider. Each of the Partnerships is a party to the New 
O&M Agreements mentioned above and do not anticipate a material adverse 
effect related to this potential change in service provider.

Operating Lease - NEA entered into a 26 year operating lease in 1986 for a 
parcel of land. The lease may be extended for another 25 years at the option 
of NEA. Lease payments under the operating lease are as follows:

Year ending December 31:
1998 ......... ........................................ $  189,000
1999 .................................................. $  201,000
2000 .................................................. $  213,000
2001 .................................................. $  225,000
2002 .................................................. $  237,000
Thereafter ............................................ $2,760,000

Lease expense under this agreement for the three and six month periods ended 
June 30, 1998 was $64,000 and $104,000, respectively.


Item 2.  Management's Discussion and Analysis of Financial Condition and 
Results of Operations for the Company and NE LP

This discussion should be read in conjunction with the Notes to Financial 
Statements and Notes to Consolidated Financial Statements contained herein. 
The results of operations for an interim period may not give a true 
indication of results for the year.

RESULTS OF OPERATIONS

The Company - A semi-annual debt interest payment of $6.4 million was made by 
the Company in June 1998.

NE LP - NE LP's operations for the six months ended June 30, 1998 primarily 
reflect the operations of the Partnerships subsequent to the Acquisitions on 
January 14, 1998 and the related allocation of the purchase price. Revenues 
for the second quarter and year to date totaled $66.5 million and $141.2 
million, respectively, and were comprised of $65.5 million and $139.0 
million, respectively, of power sales to utilities and $1.0 million and $2.2 
million, respectively, of steam sales. Power sales to utilities reflect 
changes in utility energy bank balances (which increased reported revenues) 
of $3.3 million and $7.3 million, respectively, which are determined in 
accordance with scheduled or specified rates under certain power purchase 
contracts. Revenues for the second quarter and year to date reflect lower 
generation and availability resulting from a scheduled inspection and 
maintenance outage at the NEA facility.

Fuel expense for the second quarter and year to date is comprised of $32.8 
million and $66.9 million, respectively, of fuel purchased for the 
Partnerships and the fixed and variable costs associated with the delivery 
and use of the fuel for operations. These fuel costs are offset by $5.2 
million and $9.7 million, respectively, of deferred credit amortization for 
fuel contracts as a result of the purchase price allocation of the 
Acquisitions. Fuel expense for the second quarter and year to date reflects 
decreased fuel consumption as a result of the scheduled inspection and 
maintenance outage mentioned above.

O&M expenses for the second quarter and year to date are comprised of O&M 
provider fees and site expenses of $5.1 million and $10.8 million, 
respectively, offset by $1.2 million and $2.2 million, respectively, of 
deferred credit amortization for O&M contracts as a result of the purchase 
price allocation of the Acquisitions. Included in O&M expenses is the major 
maintenance accrual of $1.1 million for the second quarter and $1.7 million 
year to date.

Depreciation and amortization for the second quarter and year to date is 
comprised of depreciation for the cogeneration and carbon dioxide facilities 
of $5.4 million and $10.1 million, respectively, and $12.6 million and $23.4 
million, respectively, of amortization of the power purchase contracts as a 
result of the purchase price allocation of the Acquisitions.

General and administrative expenses are comprised primarily of management and 
professional fees and site expenses.

Interest expense for the second quarter and year to date is comprised 
primarily of interest on notes payable to ESI Tractebel Funding Corp. ($11.5 
million and $21.3 million, respectively), interest on notes payable to the 
Company subsequent to February 19, 1998 ($4.3 million and $6.4 million, 
respectively) and interest on energy bank balances ($4.5 million and $8.4 
million, respectively).

Interest income reflects cash balances earning investment income and reflects 
the impact of the release and distribution of debt service reserve cash on 
January 21, 1998 and energy bank collateral restricted cash on February 3, 
1998.

NE LP is working to resolve the potential impact of the year 2000 on the 
processing of information by its computer systems. An assessment of 
identified software, including vendor-supplied software, has been completed 
and work has begun to make the necessary modifications. The estimated cost of 
addressing year 2000 issues in software applications is not expected to have 
a material adverse effect on NE LP's financial statements. NE LP continues to 
assess the potential financial and operational impacts of computerized 
processes embedded in operating equipment.

LIQUIDITY AND CAPITAL RESOURCES

Cash flow generated by NE LP during the six month period ended June 30, 1998 
was sufficient to fund operating expenses as well as fund the debt service 
requirements of the Company. For the six months ended June 30, 1998, there have 
been $535.4 million of contributions from partners and $330.7 million in 
distributions to partners.

During the six months ended June 30, 1998 NE LP expended net cash of $483.1 
million for acquisition of the Partnerships, received $69.2 million from 
release of restricted cash collateral and received $215.2 million of cash 
proceeds from the loan from the Company.


PART II - OTHER INFORMATION

Item 6.  Exhibits and Reports on Form 8-K

(a)   Exhibits

      Exhibit
      Number                       Description

       27.1      Financial Data Schedule - ESI Tractebel Acquisition Corp.
       27.2      Financial Data Schedule - Northeast Energy, LP

(b)   Reports on Form 8-K

      None






SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the 
registrant has duly caused this report to be signed on its behalf by the 
undersigned, thereunto duly authorized.


ESI TRACTEBEL ACQUISITION CORP.
NORTHEAST ENERGY, LP
(ESI Northeast Energy GP, Inc. as Administrative General Partner)
 (Registrants)



Date:  September 4, 1998


		PETER D. BOYLAN 
		Peter D. Boylan
		Treasurer