<PAGE>


                                                            EXHIBIT 10.3










                           SUPPLEMENTAL RETIREMENT PLAN FOR
                                 DESIGNATED OFFICERS



                              MIDAMERICAN ENERGY COMPANY





















Board Approval: December 1995
<PAGE>


                             MIDAMERICAN UTILITY COMPANY
                 SUPPLEMENTAL RETIREMENT PLAN FOR DESIGNATED OFFICERS

                                       CONTENTS

     I.   Establishment                                          1

     II.  Purpose                                                1

     III. Construction

          3.1. Definitions                                       1
          3.2. Gender and Number                                 5
          3.3. Severability                                      5

     IV.  Administration

          4.1. The Committee                                     5
          4.2. Authority of the Committee                        5
          4.3. Decisions Binding                                 6

     V.   Eligibility and Participation

          5.1. Participation                                     6
          5.2. No Employment Guarantee                           6

     VI.  Benefits

          6.1. Benefits Upon Normal Retirement                   6
          6.2. Benefits Upon Early Retirement                    6
          6.3. Benefits Upon Disability                          7
          6.4. Actuarial Equivalent Benefit                      7
          6.5. Benefits Upon Death                               7
          6.6. Forfeiture Upon Termination For Cause             8
          6.7. General Payout Restriction                        8

     VII. Individual Accounts and the Rabbi Trust

          7.1. Establishment of a Rabbi Trust                    8
          7.2. Causing the Trust to Become Irrevocable           9
          7.3. Payment of Benefits from the Trust                9


<PAGE>


     VIII. Beneficiary Designation

          8.1. Designation of Beneficiary                        9
          8.2. Payment to a Participant's Estate                 9

     IX.  Miscellaneous

          9.1. Unfunded Plan                                     9
          9.2. Withholding                                       9
          9.3. Costs of the Plan                                10
          9.4. Nontransferability                               10
          9.5. Successors                                       10
          9.6. Address of Participant or Beneficiary            10
          9.7. Applicable Law                                   10

<PAGE>



                              MIDAMERICAN ENERGY COMPANY
                 SUPPLEMENTAL RETIREMENT PLAN FOR DESIGNATED OFFICERS

     I.   ESTABLISHMENT

          MidAmerican Energy Company, an Iowa corporation (the "Company"),
          hereby establishes the Company's Supplemental Retirement Plan for
          Designated Officers (the "Plan"), effective as of January 1, 1996.

     II.  PURPOSE

          The purpose of the Plan is to enable the Company and its subsidiaries
          to attract, retain, and motivate persons of outstanding competence,
          and to provide appropriate supplemental retirement and survivor
          benefits to Designated Officers of the Company.

     III. CONSTRUCTION

          SECTION 3.1. DEFINITIONS. Whenever used herein, the following terms
          shall have the respective meanings set forth below:

          (a)  "Board" means the Board of Directors of the Company.


          (b)  "Cause" means a Participant's discharge from the employment of
               the Company because such Participant willfully engages in
               conduct, or lack thereof, that is demonstrably and materially
               injurious to the Company, its business reputation or financial
               structure, but shall not include a Qualifying Termination.
               Determination of "Cause" shall be made by the Committee in the
               exercise of good faith and reasonable judgement and approved by
               the Board.

          (c)  "Change in Control" means either:

               (i)  The closing date of the restructuring of the Company as a
                    result of merger, consolidation, takeover or reorganization
                    unless at least sixty percent (60%) of the members of the
                    board of directors of the corporation resulting from such
                    merger, consolidation, takeover or reorganization were
                    members of the Incumbent Board; or

               (ii) The occurrence of any other event that is designated as
                    being a "Change in Control" by a majority vote of the
                    directors of the Incumbent Board who are not also employees
                    of the Company.

<PAGE>


          (d)  "Code" means the Internal Revenue Code of 1986, as amended.

          (e)  "Committee" means an Administrative Committee comprised of
               Company employees selected by the President of the Company and
               approved by the Board to administer the Plan pursuant to Article
               IV herein.

          (f)  "Company" means MidAmerican Energy Company, and its subsidiaries.

          (g)  "Designated Officer" is an officer of the Company or its
               subsidiaries who has been authorized by the Board to participate
               in the Plan.

          (h)  "Disability" means a Termination of Services resulting from a
               total disability of a Participant, as a result of a medically
               determinable physical or mental impairment which renders such
               Participant unable to engage in any substantial gainful
               employment, and which can be expected to be of indefinite
               duration.  Such Disability shall be determined by the Committee
               in the exercise of good faith and reasonable judgment in reliance
               on competent medical advice from one or more qualified
               individuals selected by the Committee.

          (i)  "Disability Benefit" means, for such Participant, the Normal
               Retirement Supplemental Benefit or Early Retirement Supplemental
               Benefit, computed as though the Participant is deemed to have
               continued in employment during the period of disability and
               incurred a Termination of Services on the date he or she elects
               to begin receiving benefits hereunder.

          (j)  "Early Retirement Total Benefit" means a Normal Retirement Total
               Benefit reduced at the rate of one percentage point  for each
               full and fraction of a year that, on the effective date of
               commencement of benefits, such Participant's age is less than
               sixty-five (65)  years (i.e., 60% at age 60, 55% at age 55).

          (k)  "Early Retirement" means, for each Participant, the commencement
               of benefits after Termination of Services of such Participant
               other than because of death or Cause, but prior to such
               Participant reaching  Normal Retirement Age.

          (l)  "Early Retirement Date" means the first day of the month chosen
               by the Participant for commencement of the Early Retirement
               Supplement Benefit, which in no event shall be earlier than the
               first day of the month following the Participant's attainment of
               age fifty-five (55).

          (m)  "Early Retirement Supplemental Benefit" (see subsection (s)
               below).

          (n)  "Effective Date" means January 1, 1996.



                                          2

<PAGE>



          (o)  "ERISA" means the Employee Retirement Income Security Act of
               1974, as amended from time to time, or any successor thereto.

          (p)  "Incumbent Board" means the members of the Board on August 1,
               1995.  For this purpose, an individual who becomes a member of
               the Board subsequent to August 1, 1995 and who has been nominated
               for election by the Company's shareholders by resolution adopted
               by a vote of at least two-thirds of the directors then comprising
               the Incumbent Board at a duly convened meeting thereof shall be
               deemed to be a member of the Incumbent Board.

          (q)  "Normal Retirement Total Benefit" means the annual benefit
               provided under the Plan upon a Termination of Services on or
               following a Participant's Normal Retirement Date, in the amount
               of sixty-five percent (65%) of such Participant's Total Cash
               Compensation in effect immediately prior to such Termination of
               Services, times a fraction, the numerator being the number of
               years (including fractions of a year) of participation in this
               Plan (or participation in a similar supplemental retirement plan
               of a Predecessor Company) as of the date of Termination of
               Services, and the denominator being the number of years of
               participation if the Participant had remained employed to age 55
               (the factor shall not exceed 1.0).  The Board shall have the
               authority to grant the crediting of service with a former
               employer of a Participant in the calculation above (such
               determination shall be made when the individual is first
               designated by the Board to participate in this Plan).

          (r)  "Normal Retirement Supplemental Benefit" and "Early Retirement
               Supplemental Benefit", respectively, mean the Normal Retirement
               Total Benefit or Early Retirement Total Benefit, as applicable,
               reduced by the sum of:

               (i)  the annual benefits provided to such Participant under the
                    Company's Tax Qualified Pension Plan (determined as if the
                    Participant elected the same benefit option as selected
                    under this Plan and beginning on the same date that payments
                    begin under this Plan, or the actuarial equivalent if
                    payments are not payable as early as under this Plan, as
                    determined by the Committee in the exercise of good faith
                    and judgment);


               (ii) benefits under Iowa-Illinois Gas and Electric Company
                    Supplemental Retirement Plan, the Iowa Resources Inc. and
                    Subsidiaries Supplemental Retirement Income Plan, after
                    converting such benefits to an actuarially equivalent
                    amount, as determined by the Committee in the exercise of
                    good faith and reasonable judgment; and



                                          3

<PAGE>




               (iii)     tax qualified defined benefit pension type retirement
                         plan benefits payable to such Participant by other
                         employers of such Participant if service with such
                         other employers is credited as service under the
                         Company's Tax Qualified Pension Plan, after converting
                         such benefits to an actuarially equivalent amount, as
                         determined by the Committee in the exercise of good
                         faith and reasonable judgment.

               An Early Retirement Supplemental Benefit will not be available to
               any Participant whose Termination of Services occurs prior to
               being credited with five (5) Years of Service.

          (s)  "Normal Retirement Age" means, for each Participant, the
               attainment of age sixty-five (65) years.

          (t)  "Normal Retirement Date" means the first day of the month next
               following the date of reaching Normal Retirement Age.

          (u)  "Participant" means an officer of the Company or its subsidiaries
               who has been approved by the Board, and any retired individual
               who has a vested accrued benefit under the Plan as specified in
               Article V.

          (v)  "Plan Year" means the calendar year beginning January 1 and
               ending December 31.

          (w)  "Predecessor Company" means Midwest Resources Inc., Iowa-Illinois
               Gas and Electric Company, Midwest Energy Company, Iowa Resources
               Inc. and any member of the same controlled group of corporations
               of any of these companies.

          (x)  "Rabbi Trust" means a grantor trust, within the meaning of
               Sections 671-678 of the Code, established by the Company for the
               benefit of the Participants, both active and retired, and the
               Participants' designated beneficiaries, as specified in Article
               VIII.


          (y)  "Spouse" means a husband or wife as licensed in marriage by the
               state.

          (z)  "Survivor's Benefit" means the benefit payable to a Participant's
               surviving Spouse, designated beneficiary or estate under the Plan
               as specified in Section 6.6 in the event of such Participant's
               death.

          (aa) "Tax Qualified Pension Plan" shall mean the tax qualified defined
               benefit plan, cash balance plan and money purchase pension plan,
               if any, maintained by the



                                          4

<PAGE>

               Company, but shall not include any profit sharing plans, employee
               stock ownership plans or qualified salary reduction or cash or
               deferred plan.

          (bb) "Termination of Services" means the severing of a Participant's
               employment with the Company for any reason.

          (cc) "Total Cash Compensation" means the highest amount payable to a
               Participant by the Company (or a Predecessor Company) as annual
               base salary during the five years immediately prior to
               termination of services (including the year in which termination
               occurs), plus the average of the Participant's last three years'
               Awards under the Company's Key Employee Annual Incentive Plan or
               its successor plan(s), or under a similar annual incentive bonus
               program for executives of a Predecessor Company.  Annual Base
               Salary shall include amounts deferred under any Section 401(k)
               plans, Section 125 cafeteria plans, nonqualified deferred
               compensation plans or similar arrangements.  If less than three
               years' Awards have been made for the Participant, the average of
               all Awards shall be used.

          (dd) "Year of Service" or "Years of Service" means each full twelve
               months of service with the Company or with a Predecessor Company.

     SECTION 3.2. GENDER AND NUMBER.  Except when otherwise indicated by the
     context, any masculine term used herein also shall include the feminine;
     the plural shall include the singular; and the singular shall include the
     plural.

     SECTION 3.3. SEVERABILITY.  In the event any provision of the Plan shall be
     held illegal or invalid for any reason, the illegality or invalidity shall
     not affect the remaining parts of the Plan; and the Plan shall be construed
     and enforced as if the illegal or invalid provision had not been included.

IV.  ADMINISTRATION

     SECTION 4.1. THE COMMITTEE.  The Plan shall be administered within the
     guidelines contained in this Article IV by an Administrative Committee
     comprised of Company employees selected by the President of the Company and
     approved by the Board.  The Committee may delegate the responsibility of
     performing ministerial acts to such administrative agents as it deems
     advisable or desirable to carry out the purpose of the Plan.

     SECTION 4.2. AUTHORITY OF THE COMMITTEE.  Subject to ratification by the
     Board, the Committee shall have the power to construe and interpret the
     Plan and any agreement or instrument entered into hereunder; to prescribe,
     amend, or waive rules and regulations for the Plan's administration; and to
     make any other determination which may be necessary or advisable for the
     Plan's administration.  The Committee may correct any defect or supply any
     omission or



                                          5

<PAGE>


     reconcile any inconsistency in the Plan in the manner and to the extent
     reasonable to effect its purpose.

     The Company may elect to insure the lives of Participants; in such case,
     Participants must agree to undergo physical examinations and otherwise
     cooperate in obtaining such insurance as a condition precedent to
     participation in the Plan.  Any such life insurance policies shall be owned
     by and be considered a general asset of the Company.  Subject to Section
     7.2, no Participant or beneficiary shall have any rights to or interest in
     or shall be entitled to any benefits under such policies.

     SECTION 4.3. DECISIONS BINDING. All determinations and decisions made by
     the Committee pursuant to the provisions of the Plan, as ratified by the
     Board, and all related orders or resolutions of the Board shall be final,
     conclusive, and binding on all persons, including the Company, its
     shareholders, employees, the Participants and their estates and designated
     beneficiaries.

     The Board shall have the full power to amend or terminate the Plan at any
     time prior to the occurrence of a Change in Control, as further described
     in Article VII herein.

V.   ELIGIBILITY AND PARTICIPATION

     SECTION 5.1. PARTICIPATION. Upon approval by the Board, Designated Officers
     shall automatically become Participants under the Plan.  Retired
     individuals who have a vested accrued benefit under the Plan will also be
     considered to be Participants.

     SECTION 5.2. NO EMPLOYMENT GUARANTEE.  Neither this Plan nor any action
     taken hereunder shall be construed as giving a Participant the right to be
     retained as an employee of the Company for any period.

VI.  BENEFITS

     SECTION 6.1. BENEFITS UPON NORMAL RETIREMENT.  Upon a Participant's Normal
     Retirement, the Company shall pay to such Participant, as compensation for
     services rendered prior to such date, his or her Normal Retirement
     Supplemental Benefit in equal monthly  installments commencing on the
     Normal Retirement Date, or, if later, then first day of the month next
     following Termination of Services,  and continuing on the first day of each
     month thereafter during the lifetime of such Participant.

     SECTION 6.2. BENEFITS UPON EARLY RETIREMENT. Upon a Participant's Early
     Retirement (as chosen by the Participant), and following Termination of
     Services, the Company shall pay to the Participant, as compensation for
     services rendered prior to such date,  his or her Early Retirement
     Supplemental Benefit in equal monthly  installments commencing on the




                                          6

<PAGE>


     Participant's Early Retirement Date, and, in all cases, continuing on the
     first day of each month thereafter during the lifetime of such Participant.

     SECTION 6.3. BENEFITS UPON DISABILITY. Upon a Participant's election to
     begin receiving benefits hereunder following Termination of Services for
     Disability, the Company shall begin payment to the Participant (but no
     earlier than his or her Early Retirement Date), as compensation for
     services rendered prior to such date, his or her Disability Benefit in
     equal monthly installments commencing on the first day of the month
     selected by the Participant and continuing on the first day of each month
     thereafter during the lifetime of such Participant.

     SECTION 6.4.  ACTUARIAL EQUIVALENT BENEFIT.  If the Participant so elects
     prior to commencement of benefits hereunder, he or she may choose a payment
     option under any payment option authorized under the Company's Tax
     Qualified Pension Plan which is the actuarial equivalent of the benefit
     accrued under this Plan, using appropriate actuarial assumptions as
     determined by the Committee in the exercise of good faith and reasonable
     judgment; provided, however, no lump sum payment shall be permitted and no
     installments for a fixed period only shall be permitted.

     SECTION 6.5. BENEFITS UPON DEATH.  Upon a Participant's death, the Company
     shall pay to such Participant's designated beneficiary or estate, as
     appropriate, the following Survivor's Benefit;

          (a)  DEATH PRIOR TO COMMENCEMENT OF BENEFITS.  If a Participant dies
               prior to commencement of the payment of any benefit hereunder,
               the Company shall pay to such Participant's designated
               beneficiary or estate a Survivor's Benefit equal to the Normal
               Retirement Supplemental Benefit in one hundred eighty (180) equal
               monthly installments commencing on the first day of the month
               following such date of death and receipt of a death certificate
               by the Company, and continuing on the first day of each month
               thereafter until the one hundred eighty (180) payments have been
               made.

          (b)  DEATH AFTER COMMENCEMENT OF BENEFITS. If a Participant dies after
               commencement of the payment of any benefit hereunder, the Company
               shall pay to the Participant's surviving Spouse a Survivor's
               Benefit commencing on the first day of the month following such
               date of death and receipt of a death certificate by the Company
               and continuing on the first day of each month thereafter for the
               remaining lifetime of the surviving Spouse.  The Survivor's
               Benefit means a benefit equal to two-thirds of the Normal
               Retirement Supplemental Benefit, Early Retirement Supplemental
               Benefit or Disability Benefit, as applicable, that the
               Participant was receiving immediately prior to death, except that
               the total Survivor's Benefit shall be limited to fifty percent
               (50%) of the total benefit based upon an actuarial calculation at
               the time benefits commence.



                                          7

<PAGE>



          (c)  Payment by the Company of the benefit in Section 6.5 (a) or (b)
               shall relieve the Company of the obligation to pay a Normal
               Retirement Supplemental Benefit, an Early Retirement Supplemental
               Benefit, a Disability Benefit, or any other benefit which the
               Participant might have otherwise received under the Plan.

          (d)  In the event a Participant dies without a surviving Spouse, after
               commencement of the payment of any benefits hereunder, the
               Company shall pay to such Participant's designated beneficiary or
               estate a Survivor's Benefit equal to the Normal Retirement
               Supplemental Benefit, Early Retirement Supplemental Benefit or
               Disability Benefit, as applicable, that the Participant was
               receiving immediately prior to death such that a total of one
               hundred eighty (180) equal monthly installments is paid to the
               Participant and such Participant's designated beneficiary or
               estate.  The Survivor's Benefit portion shall commence on the
               first day of the month following such date of death and receipt
               of a death certificate by the Company, and continue on the first
               day of each month thereafter until a total of  one hundred eighty
               (180) payments have been made.

     SECTION 6.6. FORFEITURE UPON TERMINATION FOR CAUSE. Upon a Participant's
     Termination of Services for Cause, such Participant shall immediately
     forfeit all rights and benefits provided under the Plan, and the Company
     shall have no further obligation to such Participant under the Plan.

     SECTION 6.7. GENERAL PAYOUT RESTRICTIONS.  No benefits shall be paid under
     this Plan prior to the actual Termination of Services of a Participant.

VII. INDIVIDUAL ACCOUNTS AND THE RABBI TRUST

     SECTION 7.1. ESTABLISHMENT OF A RABBI TRUST. After the Effective Date, the
     Company shall be authorized, but shall not be required, to establish a
     revocable Rabbi Trust for the benefit of the Participants, both active and
     retired.  Any such Rabbi Trust shall have an independent trustee, selected
     by the Company, and, it shall contain restrictions on the Company's ability
     to amend or terminate any of the terms thereof after the Rabbi Trust shall
     become irrevocable as provided in Section 7.2.

     All assets held in the Rabbi Trust (while revocable or irrevocable) shall
     at all times be specifically subject to the claims of the Company's general
     creditors in the event of bankruptcy or insolvency; such terms shall be
     specifically defined within the provisions of the Rabbi Trust, along with a
     required procedure for notifying the Trustee of any such bankruptcy or
     insolvency.



                                          8

<PAGE>



     SECTION 7.2. CAUSING THE TRUST TO BECOME IRREVOCABLE.  The instrument
     establishing any such Rabbi Trust shall provide that the Rabbi Trust shall
     be revocable until the occurrence of either of the following:

          (i)  A Change in Control; or

          (ii) A majority vote by the Incumbent Board to make the Rabbi Trust
               irrevocable.

     SECTION 7.3. PAYMENT OF BENEFITS FROM THE TRUST.  The Company shall be
     primarily obligated to pay all benefits of Participants under the Plan,
     whether the Rabbi Trust is revocable or irrevocable at the time.  In the
     event the Company fails to fulfill any such obligation hereunder in a
     timely manner, the Trustee shall be empowered, under the terms of the Rabbi
     Trust, to either cash in any related life insurance policies or to borrow
     against the policies, to the extent necessary to pay past due benefits
     directly from the Trust.

VIII. BENEFICIARY DESIGNATION

     SECTION 8.1. DESIGNATION OF BENEFICIARY. Each Participant shall be entitled
     to designate one or more beneficiaries by filing a signed, written notice
     of such designation with the Committee, in a form as the Committee may
     prescribe.  A Participant may revoke or modify a beneficiary designation at
     any time by filing a new beneficiary designation form with the Committee.

     SECTION 8.2. PAYMENT TO A PARTICIPANT'S ESTATE. A Participant's beneficiary
     designation shall be deemed automatically revoked in the event all
     designated beneficiaries predecease such Participant or, if the sole
     beneficiary is such Participant's Spouse, in the event of dissolution of
     marriage.  In such event, or in the event a Participant does not designate
     a beneficiary, the benefits under Sections 6.5(a) and 6.5(d) shall be paid
     to such Participant's estate.

IX.  MISCELLANEOUS

     SECTION 9.1. UNFUNDED PLAN.  This Plan is intended to be an unfunded plan
     maintained primarily to provide benefits to a "select group of management
     or highly compensated employees" within the meaning of Sections 201, 301,
     and 401 of ERISA and, therefore, is further intended to be exempt from the
     provisions of Parts 2, 3, and 4 of Title I of ERISA. Accordingly, the
     Committee may terminate the Plan for any or all Participants in order to
     achieve and maintain this intended result, provided that previously accrued
     benefits hereunder shall not be reduced or otherwise adversely affected
     without the written consent of all affected Participants.

     SECTION 9.2. WITHHOLDING. The Company shall have the right to require
     Participants to remit to the Company an amount sufficient to satisfy
     Federal, state, and local tax withholding  requirements, or to deduct from
     any or all payments made pursuant to the Plan amounts



                                          9

<PAGE>


     sufficient to satisfy such tax withholding requirements.  In the event any
     FICA, FUTA, Social Security, Medicare or any similar taxes become due on
     benefits (or the value of such benefits) accrued under this Plan at any
     time prior to the actual payment of benefits under this Plan, the Company
     shall be authorized to withhold from the regular salary of such Participant
     the amount of any such tax payable by the Participant.  Withholding shall
     take place during the same calendar year in which the taxes on such
     benefits become due, or at such time as may be required by Internal Revenue
     Service regulations.

     SECTION 9.3. COSTS OF THE PLAN. All costs of implementing and administering
     the Plan shall be borne by the Company.

     SECTION 9.4. NONTRANSFERABILITY.  Neither the Participants nor any
     designated beneficiary shall have the right to sell, assign, transfer, or
     otherwise convey the right to receive any payment hereunder; nor shall any
     such payment be subject to attachment, garnishment, levy, pledge,
     bankruptcy, or any other manner or kind of execution in connection with any
     claim against the  Participants or any designated beneficiary thereof.

     SECTION 9.5. SUCCESSORS.  All obligations of the Company under the Plan
     shall be binding upon and inure to the benefit of any successor to the
     Company, whether the existence of such successor is the direct or indirect
     result of  a merger, consolidation, or reorganization involving the Company
     or the purchase or other acquisition of all or substantially all of the
     business and/or assets of the Company.

     SECTION 9.6. ADDRESS OF PARTICIPANT OR BENEFICIARY.  Each Participant shall
     keep the Company apprised of his or her current address and that of any
     designated beneficiary during his or her participation in the Plan.  Upon
     the death of a Participant, any beneficiaries entitled to receive benefit
     payment under the Plan shall keep the Company apprised of their current
     address until the entire amount to be distributed has been paid.

     SECTION 9.7. APPLICABLE LAW. To the extent not preempted by Federal law,
     the Plan shall be governed by and construed in accordance with the laws of
     the state of Iowa.

                                          10