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                                                       EXHIBIT 10.4











                              MIDAMERICAN ENERGY COMPANY

                        KEY EMPLOYEE SHORT TERM INCENTIVE PLAN
















Board Approval: October 1995

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                              MIDAMERICAN ENERGY COMPANY
                        KEY EMPLOYEE SHORT TERM INCENTIVE PLAN

SECTION 1.     PURPOSE

The purpose of this Plan is to further the financial performance of the Company
by providing incentives and rewards to executives and key employees of the
Company, or of any Affiliate or Subsidiary, who are in a position to contribute
significantly to the achievement by the Company of such performance and to align
more closely the interests of such persons with the interests of the Company's
stockholders.

SECTION 2.     DEFINITIONS

     (a)  "Plan" shall mean the MidAmerican Energy Company Key Employee
Incentive Plan.

     (b)  "Affiliate" shall mean any entity that, directly or through one or
more intermediaries, is controlled by the Company, and any entity in which the
Company has a significant equity interest, as determined by the Committee.

     (c)  "Award Period" shall mean the period of time during which Participant
Awards shall be measured.  An Award Period shall be based on one or more
consecutive Fiscal Years, but no Award Period shall exceed five (5) years.

     (d)  "Base Salary" shall mean the base compensation paid to the Participant
during a Fiscal Year, including deferrals to a Company sponsored plan that
qualifies under either Code Section 401(k) or Code Section 125.

     (e)  "Board of Directors" shall mean the Board of Directors of the Company.

     (f)  "Code" shall mean the Internal Revenue Code of 1986, as amended from
time to time.

     (g)  "Company" shall mean MidAmerican Energy Company and its Subsidiaries
and Affiliates.

     (h)  "Committee" shall mean the Compensation Committee of the Board of
Directors of the Company (the "Board") as designated by the Board to administer
the Plan.

     (i)  "Fiscal Year" shall mean the twelve months period used as the annual
accounting period by the Company and shall be designated according to the
calendar year in which such period ends.

     (j)  "Incumbent Board" means the members of the Board of Directors on
August 1, 1995.  For this purpose, an individual who becomes a member of the
Board of Directors subsequent to

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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.

     (k)  "Participant" shall mean an individual selected by the Committee
pursuant to Section 4(a) from the following group of officers and employees of
the Company:  the Chairman, the Chief Executive Officer, the President, any
Executive, Group or Senior Vice President, the Secretary, the General Counsel,
and any other Vice President, and in addition, the Chief Executive Officer is
authorized to recommend for inclusion in a Program such other salaried employees
of the Company, subject to selection by the Committee, who the Chief Executive
Officer deems to have a substantial opportunity to influence the financial
performance of the Company.

     (l)  "Participant Award" shall mean the cash or deferred compensation to be
earned by achieving each Program Target for the Award Period.

     (m)  "Program" shall mean the separate plan established by the Committee
under which a Participant may earn a predetermined Target Award for each Program
Target during an Award Period.

     (n)  "Program Target" shall mean performance goals established by the
Committee to be achieved by a Participant during an Award Period.  Each
performance goal applicable to an Award Period shall identify one or more
business criteria that are to be monitored during the Award Period.  Such
business criteria may include, but are not limited to, the following:  earnings
per share, total earnings, return on equity, return on gross investment, return
on net assets, growth in assets, free cash flow, total shareholder return, net
income, expenses as a percentage of assets, shareholder value, customer
satisfaction, customer service criteria, and system performance.  With respect
to each business criteria that is identified in a Program Target for a
particular Award Period, the Committee shall determine the target level of
performance that must be achieved in order for a performance goal to be treated
as attained.  The Committee may base performance goals for an Award Period on
one or more of the business criteria set forth above.

     (o)  "Subsidiary" shall mean a corporation in which the Company owns at
least 50% of the outstanding voting stock, and which the Committee has
designated to participate in the Plan.

     (p)  "Target Award" shall mean the value expressed as a percentage of the
Participant Award, which has been determined for each Program Target that may be
earned by each Participant, and which can be expressed as a mid-point target and
at levels below and above the mid-point target.

SECTION 3.     ADMINISTRATION

The Plan shall be administered by the Committee.  A majority of the Committee
shall constitute a quorum.  Any decision in writing signed by all members shall
be as fully effective as if made by a majority vote at a meeting duly called and
held.  Such Committee shall have sole power to:



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     (a)  determine whether to establish a Program for any Participant,
designate the applicable Award Period, and the Program Target and Target Award
to be earned in such Program by each Participant, subject only to the
limitations otherwise prescribed in this Plan;

     (b)  determine the amount of maximum (subject to the limitation in Section
4(b) below) and minimum Participant Awards which may be earned by each
Participant;

     (c)  establish other threshold criteria that must be achieved during an
Award Period for any individual Participant, department, group, division, or
Subsidiary before any Award is made to a Participant or Participants;

     (d)  construe and interpret the Plan and make and amend such rules and
regulations for the administration of the Plan as the Committee may deem
desirable;

     (e)  determine the Base Salary to be used in calculating Target Awards and
the portions, if any, of an award which may be earned if employment commences or
terminates or a Participant's position changes during an Award Period; and

     (f)  determine in its sole discretion whether or not, and the degree to
which, Program Targets for any Participant have been achieved; in making such
determinations in connection with financial goals the Committee may include or
exclude in financial results as it deems appropriate, the whole or any part of
realized capital gains and losses and extraordinary (no matter how they are
characterized for accounting purposes) gains, losses, charges or credits.

     Actions, determinations and decisions of the Committee respecting the Plan,
the granting of awards thereunder and the administration thereof shall be final,
conclusive and binding upon all parties concerned, including the Company, its
stockholders, and any employee of the Company.

SECTION 4.     PROGRAM ESTABLISHMENT

     (a)  Participants in a Program shall be selected by the Committee from the
list of employees as set forth in Section 1(j) of this Plan and who, in the
opinion of the Committee, have a substantial opportunity to influence the
financial performance of the Company.  In determining the Program Target for any
Participant, the Committee may take into account the Participant's level of
responsibility, performance, potential, cash compensation, salary, unexercised
stock options and such other considerations as it deems appropriate.

     (b)  Programs with respect to an Award Period shall be established by
resolution of the Committee selecting Participants and the related Program
Targets, Target Awards, and the maximum and minimum Participant Awards for each
Participant.  The maximum Participant Awards for all Programs during each
separate Award Period for any Participant shall not exceed 100% of Base Salary
multiplied by the number of years in the Award Period.



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SECTION 5.     DISTRIBUTION OF AWARDS

     (a)  No payments shall be made to Participants prior to the end of an Award
Period.  Under no circumstances shall an award be payable under this Plan if
none of the Program Targets for a particular Award Period are attained.

     (b)  Distribution of Participant Awards (except any Award or part thereof
which is deferred) shall be made as soon as practical after the close of the
respective Award Period and after determination and verification of the results
of each Program Target by the Committee.  A Participant may defer payment of all
or part of the Participant Award to which he or she would otherwise be entitled
at the end of the Award Period as provided in Section 6.

     (c)  The Committee in its sole and absolute discretion may reduce the
amount of an award otherwise payable to a Participant upon attainment of the
performance goal or goals established for an Award Period.  A Participant's
performance must be satisfactory, regardless of Company performance, before he
or she may be granted an incentive award.

     (d)  If a Participant's employment terminates for any of the following
reasons prior to the end of the Award Period for a Program in which he or she
was participating, distribution of such Participant Award, if any becomes
payable, shall be limited to the following portion of the Award to which he or
she would otherwise be entitled if he or she were employed at the end of such
Award Period.

          (i)  Voluntary resignation -- None of the Participant Award.

          (ii) Early Retirement or Normal Retirement under the terms of the
Company's pension plan--A distribution in proportion to the term of active
service (based on days) for the Participant during the Award Period based on
actual corporate results.

          (iii)     Disability as determined by the Committee -- A distribution
in proportion to the term of active service (based on days) for the Participant
during the Award Period based upon actual corporate results.

          (iv) Death -- A distribution to the beneficiary designated in writing
by the Participant (or in the absence of such designation, to his or her legal
representatives) in proportion to the term of active service (based on days) of
the Participant during the Award Period based upon actual corporate results.

          (v)  Discharge or requested resignation -- A distribution in
proportion to the term of active service of the Participant during the Award
Period based upon actual corporate results; however, no part of a Participant
Award shall be distributable if the Participant was discharged for any act of
fraud, misappropriation, embezzlement or other act of dishonesty.



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SECTION 6.     DEFERRED DISTRIBUTION OF AWARDS

     (a)  A Participant may defer payment of all or part of the cash portion of
the Award to which he or she would otherwise be entitled at the end of the Award
Period.  A Participant's election to defer payment must be made on or before
December 15 immediately preceding the end of the Award Period to which the
election shall apply.  The election shall be in the form of a written notice and
shall, if it so states, apply to more than one Award Period unless the
Participant is not eligible for one or more Award Periods to which the Notice
purports to apply, in which case the Notice shall apply to only those Award
Periods stated therein for which such Participant is actually eligible.  The
Notice shall state a percentage of the Award to be deferred (the "Deferred
Amount").

     (b)  The Deferred Amount with respect to any Award Period shall be governed
by the terms of the MidAmerican Energy Company Deferred Compensation Plan for
Executives ("Deferred Plan").

     (c)  The Committee shall designate, at the time of establishment of the
Program, whether any portion of any Award that may be earned thereunder shall be
mandatorily deferred under the Deferred Plan.

SECTION 7.     EXPENSES

The expenses of administering this Plan shall be borne by the Company and not
charged to any Participant.

SECTION 8.     OTHER CONDITIONS

     (a)  No person shall have any claim or right to be granted a Participant
Award under this Plan.  Neither a Participant nor his or her designated
beneficiary or legal representative shall have any right or interest in a
Participant Award until a distribution thereof shall have been made in
accordance with Sections 5, 6, or 8(e) hereof.

     (b)  It is a condition of the Plan, and all rights of each Participant
shall be subject thereto, that prior to distribution this Plan or the Deferred
Plan, no right or interest of any Participant to whom a Participant Award may be
made, shall be assignable or transferable, in whole or in part, either directly
or by operation of law or otherwise including, but not by way of limitation,
execution, levy, garnishment, attachment, pledge, bankruptcy, or in any other
manner, but no devolution by death or mental incompetency; and no such right or
interest or any Participant shall be liable for, or subject to any obligation or
liability of such Participant.

     (c)  Neither this Plan nor any action taken hereunder shall be construed as
giving to any employee the right to be retained in the employ of the Company.

     (d)  The Company shall have the right to deduct from an Award any federal,
state or local taxes required by law to be withheld with respect to such Award.



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     (e)  Upon the occurrence of a Change in Control:

          (i)  any Award then outstanding held by a Participant shall be
               immediately vested (without regard to any limitation imposed by
               the Committee at the time the Award is granted which permits all
               or any part of the Award to be received only after the lapse of
               time), and will remain so until distributed in accordance with
               the Plan; and

          (ii) any performance standards related to any Award shall be deemed
               achieved at the target level and restrictions otherwise
               applicable shall lapse.

     (f)  A "Change in Control" shall be deemed to have occurred as of:

          (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.

     (g)  All costs of Awards and compensation payable to Participants shall be
charged to the entity employing the Participant.

SECTION 9.     AMENDMENT

The Committee shall have the right to amend, suspend or terminate this Plan at
any time; provided, however, that no such modification of this Plan shall:

     (a)  without the consent of the respective Participant, operate to annul an
established Program, or

     (b)  without the approval of the Board of Directors entitled to vote
thereon increase the maximum Participant Awards which may be awarded during an
Award Period under the Plan to any one Participant, or

     (c)  change the Program Target for a Program after it has been established,
or

     (d)  make any member of the Committee eligible to receive an award at any
time while he or she is serving on the Committee.



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SECTION 10.    CODE SECTION 280G ELECTION.

Participants may elect to reduce or defer benefits otherwise payable in the
event total benefits payable by the Company would result in additional taxes to
the Company or Participant under Code Section 280G.

SECTION 11.    EFFECTIVE DATE

This Plan shall be effective as of November 1, 1995, and shall continue in
effect, until terminated by the Committee.


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