<Page>

                                                                    Exhibit 10.2










                                    GUARANTY

                          Dated as of October 18, 2001

                                      From

                               NORTHEAST UTILITIES

                                  AS GUARANTOR

                                   in favor of

                          NORTHEAST GENERATION COMPANY


<Page>

                                    GUARANTY

            GUARANTY dated as of October 18, 2001 made by Northeast Utilities, a
Massachusetts voluntary business association (the "GUARANTOR"), in favor of
Northeast Generation Company, a Connecticut corporation (the "SELLER").

            PRELIMINARY STATEMENT. Select Energy, Inc., a Connecticut
corporation (the "BUYER"), and a wholly owned subsidiary of NU Enterprises,
Inc., which is a wholly owned subsidiary of the Guarantor, is party to a Power
Purchase and Sales Agreement dated as of December 27, 1999 with the Seller (as
amended, amended and restated, supplemented or otherwise modified from time to
time, the "POWER PURCHASE AGREEMENT"). The Guarantor receives, and will continue
to derive, substantial direct and indirect benefits from the transactions
contemplated by the Power Purchase Agreement.

            NOW, THEREFORE, in consideration of the premises, the Guarantor
hereby agrees as follows:

            Section 1. GUARANTY. The Guarantor hereby absolutely,
unconditionally and irrevocably guarantees the punctual performance and payment
when due, whether as scheduled or on any date required by acceleration, demand
or otherwise, of all obligations of the Buyer now or hereafter incurred through
December 31, 2005 existing under or in respect of the Power Purchase Agreement
(including, without limitation, any modifications, substitutions, amendments or
renewals of any or all of the foregoing obligations through December 31, 2005),
whether direct or indirect, absolute or contingent, and, in the case of payment
obligations, whether for the purchase price, default interest, indemnities,
contract causes of action, costs, expenses or otherwise (such payment and
performance obligations of the Buyer being the "GUARANTEED OBLIGATIONS"), and
agrees to pay any and all expenses (including, without limitation, reasonable
fees and expenses of counsel) incurred by the Seller in enforcing any rights
under this Guaranty. Without limiting the generality of the foregoing, the
Guarantor's liability shall extend to all actions and amounts that constitute
part of the Guaranteed Obligations and that the Buyer would perform for or would
owe to the Seller under or in respect of the Power Purchase Agreement but for
the fact that they are unenforceable or not allowable due to the existence of a
bankruptcy, reorganization or similar proceeding involving the Buyer.

            Section 2. GUARANTY ABSOLUTE. The Guarantor guarantees that the
Guaranteed Obligations will be performed or paid, as applicable, strictly in
accordance with the terms of the Power Purchase Agreement, regardless of any
law, regulation or order now or hereafter in effect in any jurisdiction
affecting any of such terms or the rights of the Seller with respect thereto.
The obligations of the Guarantor under or in respect of this Guaranty are
independent of the Guaranteed Obligations or any other obligations of the Buyer
under or in respect of the Power Purchase Agreement, and a separate action or
actions may be brought and prosecuted against the Guarantor to enforce this
Guaranty, irrespective of whether any action is brought against the Buyer or
whether the Buyer is joined in any such action or actions. The liability of the
Guarantor

<Page>
                                       3


under this Guaranty shall be irrevocable, absolute and unconditional
irrespective of, and the Guarantor hereby irrevocably waives any defenses it may
now have or hereafter acquire in any way relating to, any or all of the
following:

            (a) any lack of validity or enforceability of the Power Purchase
      Agreement, the Financing Documents (as defined below) or any agreement or
      instrument relating thereto;

            (b) any change in the time, manner or place of performance or
      payment of, or in any other term of, all or any of the Guaranteed
      Obligations or any other obligations of the Buyer under or in respect of
      the Power Purchase Agreement, the Seller under its 4.998% Series A Senior
      Secured Bonds due 2005 or its 8.812% Series B Senior Secured Bonds due
      2026, or indentures pertaining thereto (the "Financing Documents"), or any
      other amendment or waiver of or any consent to departure from either of
      the Power Purchase Agreement or the Financing Documents, including,
      without limitation, any increase in the Guaranteed Obligations;

            (c) any taking, exchange, release or non-perfection of any
      collateral, including, without limitation, any letter of credit, or any
      taking, release or amendment or waiver of, or consent to departure from,
      any other guaranty, for all or any of the Guaranteed Obligations;

            (d) any manner of application of any collateral, or proceeds
      thereof, including any drawings on any letter of credit, to all or any of
      the Guaranteed Obligations, or any manner of sale or other disposition of
      any collateral for all or any of the Guaranteed Obligations or any other
      obligations of the Buyer under the Power Purchase Agreement or of the
      Seller under the Financing Documents or any other assets of the Buyer or
      the Seller;

            (e) any change, restructuring or termination of the corporate
      structure or existence of the Buyer;

            (f) any failure of the Seller to disclose to the Buyer any
      information relating to the business, condition (financial or otherwise),
      operations, performance, properties or prospects of the Buyer now or
      hereafter known to the Seller (the Guarantor waiving any duty on the part
      of the Seller to disclose such information);

            (g) the failure of any other Person to execute or deliver any other
      guaranty or agreement or the release or reduction of liability of any
      other guarantor or surety with respect to the Guaranteed Obligations; or

            (h) any other circumstance (including, without limitation, any
      statute of limitations) or any existence of or reliance on any
      representation by the Seller that might

<Page>
                                       4


      otherwise constitute a defense available to, or a discharge of, the Buyer
      or any other guarantor or surety.

This Guaranty shall continue to be effective or be reinstated, as the case may
be, if at any time any payment of any of the Guaranteed Obligations is rescinded
or must otherwise be returned by the Seller or any other Person upon the
insolvency, bankruptcy or reorganization of the Buyer or otherwise, all as
though such payment had not been made.

            Section 3. WAIVERS AND ACKNOWLEDGMENTS. (a) The Guarantor hereby
unconditionally and irrevocably waives promptness, diligence, notice of
acceptance, presentment, demand for performance, notice of nonperformance,
default, acceleration, protest or dishonor and any other notice with respect to
any of the Guaranteed Obligations and this Guaranty and any requirement that the
Seller protect, secure, perfect or insure any lien or any property subject
thereto or exhaust any right or take any action against the Buyer or any other
Person or any collateral.

            (b) The Guarantor hereby unconditionally and irrevocably waives any
right to revoke this Guaranty and acknowledges that this Guaranty is continuing
in nature and applies to all Guaranteed Obligations, whether existing now or in
the future.

            (c) The Guarantor hereby unconditionally and irrevocably waives (i)
any defense arising by reason of any claim or defense based upon an election of
remedies by the Seller that in any manner impairs, reduces, releases or
otherwise adversely affects the subrogation, reimbursement, exoneration,
contribution or indemnification rights of the Guarantor or other rights of the
Guarantor to proceed against the Buyer, any other guarantor or any other Person
or any collateral and (ii) any defense based on any right of set-off or
counterclaim against or in respect of the obligations of the Guarantor
hereunder.

            (d) The Guarantor hereby unconditionally and irrevocably waives any
duty on the part of the Seller to disclose to the Guarantor any matter, fact or
thing relating to the business, condition (financial or otherwise), operations,
performance, properties or prospects of the Buyer now or hereafter known by the
Seller.

            Section 4. SUBROGATION. The Guarantor hereby unconditionally and
irrevocably agrees not to exercise any rights that it may now have or hereafter
acquire against the Buyer or any other insider guarantor that arise from the
existence, payment, performance or enforcement of the Guarantor's obligations
under or in respect of this Guaranty, including, without limitation, any right
of subrogation, reimbursement, exoneration, contribution or indemnification and
any right to participate in any claim or remedy of the Seller against the Buyer
or any other insider guarantor or any collateral, whether or not such claim,
remedy or right arises in equity or under contract, statute or common law,
including, without limitation, the right to take or receive from the Buyer or
any other insider guarantor, directly or indirectly, in cash or other property
or by set-off or in any other manner, payment or security on account of such
claim, remedy or right, unless

<Page>
                                       5


and until all of the obligations to be performed and amounts to be paid under
the Financing Documents have been performed and paid in full, in the case of
payments, in cash and the Financing Documents shall have expired or been
terminated. If any amount shall be paid to the Guarantor in violation of the
immediately preceding sentence at any time prior to the latest of (a) the
complete performance of all Guaranteed Obligations, (b) the payment in full in
cash of the Guaranteed Obligations and all other amounts payable under this
Guaranty and (c) the expiration or termination of the Financing Documents, such
amount shall be received and held in trust for the benefit of the Seller, shall
be segregated from other property and funds of the Guarantor and shall forthwith
be paid or delivered to the Seller in the same form as so received (with any
necessary endorsement or assignment) to be credited and applied to the
Guaranteed Obligations and all other amounts payable under this Guaranty,
whether matured or unmatured, in accordance with the terms of the Power Purchase
Agreement, or to be held as collateral for any Guaranteed Obligations or other
amounts payable under this Guaranty thereafter arising. If (i) the Guarantor
shall make payment to the Seller of all or any part of the Guaranteed
Obligations, (ii) all of the Guaranteed Obligations shall have been performed or
paid in full, in the case of payments, in cash and (iii) the expiration or
termination of the Financing Documents shall have occurred, the Seller will, at
the Guarantor's request and expense, execute and deliver to the Guarantor
appropriate documents, without recourse and without representation or warranty,
necessary to evidence the transfer by subrogation to the Guarantor of an
interest in the Guaranteed Obligations resulting from such payment made by the
Guarantor pursuant to this Guaranty.

            Section 5. PAYMENTS FREE AND CLEAR OF TAXES, ETC. (a) Any and all
payments made by the Guarantor under or in respect of this Guaranty shall be
made, in accordance with the Power Purchase Agreement, free and clear of and
without deduction for any and all present or future taxes. If the Guarantor
shall be required by law to deduct any taxes from or in respect of any sum
payable under or in respect of this Guaranty to the Seller, (i) the sum payable
by the Guarantor shall be increased as may be necessary so that after the
Guarantor and the Seller have made all required deductions (including deductions
applicable to additional sums payable under this Section 5), the Seller receives
an amount equal to the sum it would have received had no such deductions been
made, (ii) the Guarantor shall make all such deductions and (iii) the Guarantor
shall pay the full amount deducted to the relevant taxation authority or other
authority in accordance with applicable law.

            (b) In addition, the Guarantor agrees to pay any present or future
stamp, documentary, excise property or similar taxes, charges or levies that
arise from any payment made under or in respect of this Guaranty or from the
execution, delivery or registration of, performance under, or otherwise with
respect to, this Guaranty (hereinafter referred to as "OTHER TAXES").

            (c) The Guarantor shall indemnify the Seller for and hold it
harmless against the full amount of taxes and Other Taxes, and for the full
amount of taxes of any kind imposed by any jurisdiction on amounts payable under
this Section 5, imposed on or paid by the Seller and any liability (including
penalties, additions to tax, interest and expenses) arising therefrom or

<Page>
                                       6


with respect thereto. This indemnification shall be made within 30 days from the
date the Seller makes written demand therefor.

            (d) Within 30 days after the date of any payment of taxes by or on
behalf of the Guarantor, the Guarantor shall furnish to the Seller, at its
address referred to in Section 8, the original or a certified copy of a receipt
evidencing such payment.

            Section 6. REPRESENTATIONS AND WARRANTIES. The Guarantor hereby
represents and warrants as follows:

            (a) There are no conditions precedent to the effectiveness of this
Guaranty that have not been satisfied or waived.

            (b) It has, independently and without reliance upon the Seller and
based on such documents and information as it has deemed appropriate, made its
own credit analysis and decision to enter into this Guaranty, and it has
established adequate means of obtaining from the Buyer on a continuing basis
information pertaining to, and is now and on a continuing basis will be
completely familiar with, the business, condition (financial or otherwise),
operations, performance, properties and prospects of the Buyer.

            (c) (i) It is a Massachusetts voluntary association duly organized,
validly existing and in good standing under the laws of the Commonwealth of
Massachusetts, (ii) it is duly qualified to do business in each other
jurisdiction in which it owns or leases property or in which the conduct of its
business requires it to be so qualified or licensed except where the failure to
be so qualified would not reasonably be expected to have a material adverse
effect and (ii) it has all requisite power and authority under its Declaration
of Trust and all governmental licenses, permits and other approvals to own or
lease and operate its properties and to carry on its business as now conducted
and as proposed to be conducted.

            (d) The execution, delivery and performance by the Guarantor of this
Guaranty and the other transactions contemplated hereby, are within the
Guarantor's powers, corporate or otherwise, have been duly authorized by all
necessary action, corporate or otherwise, and do not (i) contravene the
Guarantor's charter or bylaws or equivalent organizational or governance
document, (ii) violate any law, rule, regulation, order, writ, judgment,
injunction, decree, determination or award, (iii) conflict with or result in the
breach of, or constitute a default under, any material contract, loan agreement,
indenture, mortgage, deed of trust, lease or other instrument binding on or
affecting the Guarantor or any of its subsidiaries or any of its or their
properties, or (iv) result in or require the creation or imposition of any lien
upon or with respect to any of the properties of the Guarantor or any of its
subsidiaries.

            (e) No authorization or approval or other action by, and no notice
to or filing with, any nation or government, any state, province or other
political subdivision thereof, or any governmental, executive, legislative,
judicial, administrative or regulatory agency, department,

<Page>
                                       7


authority, instrumentality, commission, board or similar body, whether federal,
state, provincial, territorial, local or foreign or any third party which has
not already been obtained is required for (i) the due execution, delivery,
recordation, filing or performance by the Guarantor of this Guaranty or the
other transactions contemplated hereby or (ii) the exercise by the Seller of its
rights hereunder.

            (f) This Guaranty has been duly executed and delivered by the
Guarantor. This Guaranty is the legal, valid and binding obligation of the
Guarantor, enforceable against the Guarantor in accordance with its terms,
subject to bankruptcy and other such laws relating to creditors' rights
generally.

            (g) After giving effect to this Guaranty, the aggregate amount of
the Guarantor's absolute or contingent payment obligations pursuant to
guarantees and similar forms of credit support or enhancements (collectively,
"CREDIT SUPPORT") issued by the Guarantor does not exceed the maximum amount of
Credit Support authorized by the Securities and Exchange Commission under the
Public Utility Holding Company Act of 1935, as amended.

            Section 7. AMENDMENTS. No amendment or waiver of any provision of
this Guaranty and no consent to any departure by the Guarantor therefrom shall
in any event be effective unless the same shall be in writing and signed by the
Seller, and then such waiver or consent shall be effective only in the specific
instance and for the specific purpose for which given.

            Section 8. NOTICES, ETC. All notices and other communications
provided for hereunder shall be in writing (including telegraphic, telecopy or
telex communication) and mailed, telegraphed, telecopied, telexed or delivered
to it, if to the Guarantor, addressed to it at the following address 107 Selden
Street, Berlin, CT 06037, Attention: David R. McHale, Vice President and
Treasurer, Northeast Utilities Service Company, (Telecopy No (860) 665-3847;
Telephone No. (860) 665-5601), if to the Seller, at its address specified in
Section 13.5 of the Power Purchase Agreement, or, as to either party, at such
other address as shall be designated by such party in a written notice to the
other party. All such notices and other communications shall, when mailed,
telegraphed, telecopied or telexed, be effective when deposited in the mails,
delivered to the telegraph company, transmitted by telecopier or confirmed by
telex answerback, respectively. Delivery by telecopier of an executed
counterpart of a signature page to any amendment or waiver of any provision of
this Guaranty shall be effective as delivery of an original executed counterpart
thereof.

            Section 9. NO WAIVER; REMEDIES. No failure on the part of the Seller
to exercise, and no delay in exercising, any right hereunder shall operate as a
waiver thereof; nor shall any single or partial exercise of any right hereunder
preclude any other or further exercise thereof or the exercise of any other
right. The remedies herein provided are cumulative and not exclusive of any
remedies provided by law.


<Page>
                                       8


            Section 10. RIGHT OF SET-OFF. The Seller is hereby authorized at any
time and from time to time, to the fullest extent permitted by law, to set off
and apply any and all deposits (general or special, time or demand, provisional
or final) at any time held and other indebtedness at any time owing by the
Seller to or for the credit or the account of the Guarantor against any and all
of the obligations of the Guarantor now or hereafter existing under this
Guaranty, irrespective of whether the Seller shall have made any demand under
this Guaranty. The Seller agrees promptly to notify the Guarantor after any such
set-off and application; PROVIDED, HOWEVER, that the failure to give such notice
shall not affect the validity of such set-off and application. The rights of the
Seller under this Section are in addition to other rights and remedies
(including, without limitation, other rights of set-off) that the Seller may
have at law or otherwise.

            Section 11. INDEMNIFICATION. (a) Without limitation on any other
obligations of the Guarantor or remedies of the Seller under this Guaranty, the
Guarantor shall, to the fullest extent permitted by law, indemnify, defend and
save and hold harmless the Seller and its respective officers, directors,
employees, agents and advisors (each, an "INDEMNIFIED PARTY") from and against,
and shall pay on demand, any and all claims, damages, losses, liabilities and
expenses (including, without limitation, reasonable fees and expenses of
counsel) that may be incurred by or asserted or awarded against any Indemnified
Party in connection with or as a result of (i) any failure of any Guaranteed
Obligations to be the legal, valid and binding obligations of the Buyer
enforceable against the Buyer in accordance with their terms or (ii) any breach
by the Buyer of the Power Purchase Agreement.

            (b) Without prejudice to the survival of any of the other agreements
of the Guarantor under this Guaranty, the agreements and obligations of the
Guarantor contained in Section 1(a) (with respect to enforcement expenses), the
last sentence of Section 2, Section 5 and this Section 11 shall survive the
payment and performance in full of the Guaranteed Obligations and all of the
other amounts payable under this Guaranty.

            Section 12. CONTINUING GUARANTY; ASSIGNMENTS. This Guaranty is a
continuing guaranty and shall (a) remain in full force and effect until the
later of (i) the performance in full of all the Guaranteed Obligations and the
payment in full in cash of the Guaranteed Obligations and all other amounts
payable under this Guaranty, and (ii) the termination of this Guaranty, (b) be
binding upon the Guarantor, its successors and assigns and (c) inure to the
benefit of and be enforceable by the Seller and its successors, transferees and
assigns. Without limiting the generality of clause (b) and (c) of the
immediately preceding sentence, the Seller may assign or otherwise transfer all
or any portion of its rights and obligations under this Guaranty and the Power
Purchase Agreement to any other Person and such other Person shall thereupon
become vested with all the benefits in respect thereof granted to the Seller
herein and therein or otherwise. The Guarantor shall not have the right to
assign its rights hereunder or any interest herein without the prior written
consent of the Seller.

<Page>
                                       9


            Section 13. EXECUTION IN COUNTERPARTS. This Guaranty and each
amendment, waiver and consent with respect hereto may be executed in any number
of counterparts and by the parties thereto in separate counterparts, each of
which when so executed shall be deemed to be an original and all of which taken
together shall constitute one and the same agreement. Delivery of an executed
counterpart of a signature page to this Guaranty by telecopier shall be
effective as delivery of an original executed counterpart of this Guaranty.

            Section 14. GOVERNING LAW; JURISDICTION; WAIVER OF JURY TRIAL, ETC.
(a) This Guaranty shall be governed by, and construed in accordance with, the
laws of the State of New York.

            (b) The Guarantor hereby irrevocably and unconditionally submits,
for itself and its property, to the nonexclusive jurisdiction of any New York
State court or federal court of the United States of America sitting in New York
City, and any appellate court from any thereof, in any action or proceeding
arising out of or relating to this Guaranty, or for recognition or enforcement
of any judgment, and the Guarantor hereby irrevocably and unconditionally agrees
that all claims in respect of any such action or proceeding may be heard and
determined in any such New York State court or, to the extent permitted by law,
in such federal court. The Guarantor agrees that a final judgment in any such
action or proceeding shall be conclusive and may be enforced in other
jurisdictions by suit on the judgment or in any other manner provided by law.
Nothing in this Guaranty shall affect any right that the Seller may otherwise
have to bring any action or proceeding relating to this Guaranty in the courts
of any jurisdiction.

            (c) The Guarantor irrevocably and unconditionally waives, to the
fullest extent it may legally and effectively do so, any objection that it may
now or hereafter have to the laying of venue of any suit, action or proceeding
arising out of or relating to this Guaranty in any New York State or federal
court. The Guarantor hereby irrevocably waives, to the fullest extent permitted
by law, the defense of an inconvenient forum to the maintenance of such suit,
action or proceeding in any such court.


<Page>
                                       10


            (d) THE GUARANTOR HEREBY IRREVOCABLY WAIVES ALL RIGHT TO TRIAL BY
JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM (WHETHER BASED ON CONTRACT, TORT
OR OTHERWISE) ARISING OUT OF OR RELATING TO THIS GUARANTY OR THE ACTIONS OF THE
SELLER IN THE NEGOTIATION, ADMINISTRATION, PERFORMANCE OR ENFORCEMENT THEREOF.

            Section 15. LIMITATION OF LIABILITY. No shareholder or trustee of
the Guarantor shall be held to any liability whatever for the payment of any sum
of money or for damages or otherwise under this Guaranty, and this Guaranty
shall not be enforceable against any such trustee in their or his or her
individual capacities or capacity and this Guaranty shall be enforceable against
the trustees of the Guarantor only as such, and every person, firm, association,
trust or corporation having any claim or demand arising under this Guaranty and
relating to the Guarantor, its shareholders or trustees shall look solely to the
trust estate of the Guarantor for the payment or satisfaction thereof.

            IN WITNESS WHEREOF, the Guarantor has caused this Guaranty to be
duly executed and delivered by its officer thereunto duly authorized as of the
date first above written.

                                NORTHEAST UTILITIES

                                By:     /s/ David J. McHale
                                Name:   David J. McHale
                                Title:  Vice President and Treasurer
                                         of Northeast Utilities Service Company