EXHIBIT 10.1
Wisconsin Electric Power Company
231 West Michigan Street
P.O. Box 2046
Milwaukee, WI 53201


                                                       January 5, 1998


Mr. Michael B. Sellman
5 Harold's Way
Freeport, ME 04032

Dear Mike:

      This letter will confirm our offer of employment to you, subject to your
satisfaction of the contingency noted in item 7 below, with the specifics to
be as follows:

      1.  Position:  Your title will be Senior Vice President of the Nuclear
          Power Business Unit and you will serve as Chief Nuclear Officer of
          the Company.  You would report to me in my capacity as President
          and Chief Operating Officer of the Company.

      2.  Base Salary:  Base salary will be payable to you at the rate of Two
          Hundred Fifty Thousand Dollars ($250,000) per year, payable in
          accordance with the Company's regular payroll practices.

      3.  Special Signing Bonus:  As a special inducement, we will pay you a
          special signing bonus of Fifty Thousand Dollars ($50,000) promptly
          after you report for work with us.  An additional Fifty Thousand
          Dollars ($50,000) will become payable to you if you remain in our
          employ on the 2nd anniversary of your starting date with us.

      4.  Moving Expenses and Temporary Living Expenses:  The Company will pay
          or reimburse you for your reasonable moving costs in accordance with
          standard Company policy.  In addition, the Company will pay
          reasonable rent including utilities on such leased premises as you
          desire to obtain here, provided only that you submit the leasing
          arrangements to the Company for its prior approval, until the
          earlier of July 1, 1998 or your purchase of a residence here.

      5.  Other Benefits:  You will participate in the Wisconsin Energy
          Corporation Supplemental Executive Retirement Plan with respect to
          monthly benefits "A" and "B."  Monthly benefit "A" is designed to
          make up for any limitations imposed on the amount of your accrued
          benefit under the Company's tax-qualified defined benefit plan (the
          "Retirement Account Plan") upon your retirement at or after age 60,
          because of benefit limits under Section 415 of the Internal Revenue
          Code or the limit on annual compensation imposed by Section
          401(a)(17) of such Code.  Monthly benefit "B" is a special
          supplemental pension benefit equal to a life annuity of 10% of your
          average total compensation during your highest 36 consecutive
          months, which will become available to you upon your retirement at
          or after age 60.  You will also participate on a basis commensurate
          with other senior executives of the Company in any other employee
          benefits, perquisites, vacations plans, or executive short-term and
          long-term incentive compensation programs as may exist from time to
          time.  Also, you will be entitled to participate in all applicable
          retirement and savings plans and all welfare benefit plans and
          practices which the Company makes available to its salaried
          employees generally.  The Company requires an annual medical
          physical exam by a physician or clinic of your choice, at Company
          expense.

      6.  Special Deferred Compensation Benefit:  The Company agrees to create
          a special bookkeeping account (the "Account") and to credit the same
          with Four Hundred and Twenty-Two Thousand ($422,000) as of
          January 1, 1998 and to thereafter adjust the Account annually as of
          December 31 of each year with the same investment results as would
          have been credited to the Account had it been invested as a part of
          the funds of the Company's tax-qualified defined benefit plan, the
          Retirement Account Plan.  The current value recorded in the Account
          will become payable to you in a single lump sum, less applicable
          withholding, on the first to occur of any of the following events:

          (a)   Your termination of employment for any reason at any time on
                or after your attainment of age 60 (the "Vesting Date").

          (b)   Your termination of employment at any time prior to the
                Vesting Date because of death or such disability as prevents
                you from continuing to substantially perform the duties of
                your job.

          Should your employment cease prior to the Vesting Date other than
          because of death or disability as described in (b) above, you will
          forfeit any interest in the Account.  Values held in the Account or
          which become payable to you from the Account will not be included or
          taken into consideration in the calculation of any benefits due you
          under any other retirement or welfare benefit plan or program of the
          Company which bases benefits in whole or in part on compensation.
          The Account will be solely a bookkeeping reserve established by the
          Company as a device for determining amounts that may become payable
          to you and any right to receive payments under this paragraph will
          be an unsecured claim against the general assets of the Company.
          Any claims for payments under this paragraph will be subject to same
          claim procedure rules as apply to the Retirement Account Plan.  You
          will have the right to name a beneficiary to receive any benefits
          that may become payable under this paragraph on your death, by
          filing a written notice with the Company on a form prescribed by it.
          If you fail to designate a beneficiary, any unpaid benefits due will
          be paid to your estate.

      7.  Offer Contingent on Your Release by Current Employer.  This offer is
          contingent upon your obtaining a written release satisfactory to the
          Company from your current employer (Entergy) indicating that you are
          free to accept this offer and that your employment as Senior Vice
          President of the Nuclear Power Business Unit and Chief Nuclear
          Officer of the Company would not violate the provisions of any
          non-compete agreement, or other contract or restrictions currently
          in effect between you and your current employer.

     All benefits described above which are further defined in plan documents
are subject to all of the terms in those documents which supersede any other
description.  Management reserves the right in its discretion to change or
terminate all current benefit plans or practices and other policies and
procedures.

     Your employment would be considered at-will; that is, you could be
discharged for any reason or no reason at all, at any time and without notice,
and, likewise, you may resign at any time and without notice.

     We anticipate that your starting date with us would be within 60 days of
your acceptance.  This offer supersedes all our prior discussions and will
remain open until January 16, 1998.

     We look forward to hearing from you and hope that you will join us.

                                               Very truly yours,


                                               /s/ Richard R. Grigg
                                               --------------------------
                                               Richard R. Grigg,
                                               President and COO