Document:

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                             SUBSCRIPTION AGREEMENT

         THIS SUBSCRIPTION AGREEMENT (this "Agreement") is entered into as of
July 31, 2000, by and among Columbia Energy Services Corporation, a Delaware
corporation ("CES"), and TNPC, Inc., a Delaware corporation (the "Company"),
and, solely for purposes of the provisions set forth in Section 3.2, 4.6 and
5.4 hereof, Enron Energy Services, LLC, a Delaware limited liability company
("EES").

         WHEREAS, pursuant to that certain Asset Purchase Agreement dated as
of June 29, 2000, by and among CES, Columbia Energy Retail Corporation, and
Columbia Energy Power Marketing Corporation, as Sellers, and the Company, as
Buyer (the "Asset Purchase Agreement"), the Company is acquiring the
Specified Assets (as defined in the Asset Purchase Agreement);

         WHEREAS, as part of the consideration payable by the Company for the
sale of the Specified Assets to the Company, the Company has agreed to issue
and deliver to CES shares of common stock, par value $0.01 per share, of the
Company (the "Common Stock"); and

         WHEREAS, CES and the Company wish to set forth the terms on which
such Common Stock will be issued to CES.

         NOW, THEREFORE, for and in consideration of the foregoing premises,
mutual covenants, rights and obligations set forth herein, the benefits to be
derived therefrom and for other good and valuable consideration, the receipt
and sufficiency of which are hereby expressly acknowledged by the parties
hereto, the parties hereto agree as follows:

                                    ARTICLE I
                                  SUBSCRIPTION

         1.1      SUBSCRIPTION BY CES.

         (a)      Upon the terms and subject to the conditions hereof, CES
hereby subscribes for and agrees to accept from the Company, and the Company
agrees to issue and deliver to CES, 3,011 shares of Common Stock of the
Company as consideration for the sale and delivery of the Specified Assets to
the Company. On the Closing Date (as defined in the Asset Purchase Agreement)
the Company shall deliver to CES a certificate evidencing the shares of
Common Stock issued pursuant to this Section 1.1. Such certificate issued
shall be in definitive form and registered in the name of CES and shall bear
the legends set forth in Section 4.2. Such shares of Common Stock issued
pursuant to the terms of this Section 1.1 shall be hereinafter referred to as
the "Securities."

         (b)      Notwithstanding the foregoing, the issuance of the
Securities shall be delayed to the extent necessary so that the issuance of
such Securities will not contravene any applicable law or outstanding
injunction, order or decree, PROVIDED, HOWEVER, that the consideration for
the Securities shall not in any way be affected by any such delay.

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         1.2      AGREEMENT TO BE BOUND. CES agrees that the Securities shall
be subject to the terms of this Agreement and the certificate of
incorporation and by-laws of the Company as they may be amended from time to
time.

                                   ARTICLE II
                      REPRESENTATIONS AND WARRANTIES OF CES

         CES represents and warrants to the Company and EES that the
following is true as of the date hereof:

         2.1      ORGANIZATION; GOOD STANDING. CES is a corporation duly
organized, validly existing and in good standing under the laws of the state
of its incorporation, with full corporate power and authority to carry on its
business as presently conducted.

         2.2      AUTHORITY. CES has the corporate power and authority to
execute, deliver and perform its obligations under this Agreement and to
consummate the transactions contemplated hereby. CES has taken all necessary
corporate action to authorize its execution, delivery and performance of this
Agreement.

         2.3      DUE EXECUTION AND ENFORCEABILITY. This Agreement has been
duly executed and delivered by CES, and (assuming due authorization,
execution and delivery of this Agreement by the Company and EES) this
Agreement constitutes a legal, valid and binding obligation of CES,
enforceable against it in accordance with its terms, except as such
enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium or other laws of general application referring to
or affecting enforcement of creditors' rights and general principles of
equity.

         2.4      ACCREDITED INVESTOR; QUALIFIED BUYER.

         (a)      CES is acquiring the Securities for its own account, solely
for investment purposes, and not with a view to, or for resale in connection
with, any distribution of the Securities.

         (b)      CES understands that the Securities will not be registered
under the Securities Act or any federal or state law by reason of specific
exemptions under the provisions thereof, the availability of which depends in
part upon the bona fide nature of its investment intent and upon the accuracy
of its representations made in this Section 2.4.

         (c)      CES understands that the Company is relying upon the
representations and agreements contained in this Section 2.4 for the purpose
of determining whether this transaction meets the requirements for such
exemptions.

         (d)      CES is an "accredited investor" as defined in Rule 501(a)
under the Securities Act of 1933, as amended (the "Securities Act").

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         (e)      CES is a "qualified institutional buyer" as defined in Rule
144A(a) under the Securities Act.

         (f)      CES has such knowledge, skill and experience in business,
financial and investment matters that it is capable of evaluating the merits
and risks of an investment in the Securities. CES recognizes that an
investment in the Securities is a speculative investment involving a high
degree of risk. CES is and will be able to bear the economic risks of this
investment and, consequently, without limiting the generality of the
foregoing, CES is and will be able to hold the Securities for an extended
period of time and will have a sufficient net worth to sustain a loss of its
entire investment in the Securities in the event such loss should occur.

         (g)      CES understands that the Securities will be "restricted
securities" under applicable federal securities laws and that the Securities
Act and the Securities and Exchange Commission provide in substance that it
may dispose of the Securities only pursuant to an effective registration
statement under the Securities Act or an exemption therefrom. CES further
understands that the Company (i) has and will have no obligation to file a
registration statement under the Securities Act with respect to the
Securities or to make a registered public offering of shares of Common Stock,
and (ii) has not registered and has and will have no obligation to register
its Common Stock under the Securities Exchange Act of 1934, as amended (the
"Securities Exchange Act").

         (h)      CES has been furnished by the Company with information (or
provided access to information) regarding the business and financial
condition of the Company, its expected plans for future business activities,
the attributes of the Securities and the merits and risks of an investment in
the Securities that it has requested or otherwise needs to evaluate the
investment in the Securities.

         2.5      NO CONFLICT. The execution, delivery and performance of
this Agreement by CES does not and will not (i) violate, conflict with or
result in the breach of any provision of its organizational documents, (ii)
conflict with or violate any law, governmental regulation or governmental
order applicable to it or any of its assets, properties or businesses or
(iii) conflict with, result in any breach of, constitute a default (or event
which with the giving of notice or lapse of time, or both, would become a
default) under, require any consent under, or give to others any rights of
termination, amendment, acceleration, suspension, revocation or cancellation
of, or result in the creation of any encumbrance on any of CES's assets or
properties pursuant to any note, bond, mortgage or indenture, contract,
agreement, lease, sublease, license, permit, franchise or other instrument or
arrangement to which CES is a party or by which any of its assets or
properties is bound or affected; except to the extent that any conflict under
(ii) or (iii) above would not have a material adverse effect on the financial
condition, business or operations (a "Material Adverse Effect") of CES and
its subsidiaries taken as a whole or prevent or materially delay the
consummation of the transactions contemplated by this Agreement.

         2.6      GOVERNMENT CONSENTS. The execution, delivery and
performance of this Agreement by CES does not and will not require any
consent, approval, authorization or other order of, action by, filing with or
notification to, any court, judicial or quasi-judicial or administrative
agency or

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body or commission or other governmental or other regulatory authority or
agency (a "Governmental Authority").

         2.7      PUHCA. CES is not subject to, or is exempt from, regulation
as a "holding company," a "subsidiary company" of a "holding company," an
"affiliate" of a "holding company," or an "affiliate" of a "subsidiary
company" of a "holding company," in each case as such terms are defined in
the Public Utility Holding Company Act of 1935, as amended ("PUHCA"), except
as to the requirements of Section 9(a)(2) of PUHCA in accordance with Rule 2
promulgated thereunder.

                                   ARTICLE III
                    REPRESENTATIONS, WARRANTIES AND COVENANTS
                                 OF THE COMPANY

         3.1      REPRESENTATIONS, WARRANTIES AND COVENANTS OF THE COMPANY.
The Company represents and warrants to CES that the following is true as of
the date hereof:

                  3.1.1    ORGANIZATION; GOOD STANDING. The Company is a
         corporation duly organized, validly existing and in good standing under
         the laws of its state of incorporation, and has the corporate power and
         authority to carry on its business as presently conducted. The Company
         is in good standing in each jurisdiction in which the properties owned
         or leased by it or the operation of its business makes such
         qualification necessary, except to the extent that the failure to be so
         qualified would not have a Material Adverse Effect on the Company and
         its subsidiaries taken as a whole, or prevent or materially delay the
         consummation of the transactions contemplated by this Agreement.

                  3.1.2    AUTHORITY. The Company has the corporate power and
         authority to execute, deliver and perform its obligations under this
         Agreement and to consummate the transactions contemplated hereunder.
         The execution and delivery of this Agreement by the Company, the
         performance by the Company of its obligations hereunder, and the
         consummation by the Company of the transactions contemplated hereby
         have been duly authorized by all requisite corporate action on the part
         of the Company.

                  3.1.3    DUE EXECUTION AND ENFORCEABILITY. This Agreement has
         been duly executed and delivered by the Company, and (assuming due
         authorization, execution and delivery by CES and EES hereto) this
         Agreement constitutes a legal, valid and binding obligation of the
         Company, enforceable against it in accordance with its terms, except as
         such enforceability may be limited by applicable bankruptcy,
         insolvency, reorganization, moratorium or other laws of general
         application referring to or affecting enforcement of creditors' rights
         and general principles of equity.

                  3.1.4    PUHCA. The Company is not subject to, or is exempt
         from, regulation as a "holding company," a "subsidiary company" of a
         "holding company," an "affiliate" of a "holding company," or an
         "affiliate" of a "subsidiary company" of a "holding company," in

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         each case as such terms are defined in PUHCA, except as to the
         requirements of Section 9(a)(2) of PUHCA in accordance with Rule 2
         promulgated thereunder.

                  3.1.5    CAPITAL STOCK. The authorized capital stock of the
         Company consists of 2,000,000 shares of common stock, $0.01 par value
         per share, of which 119,019 shares are duly authorized and validly
         issued and outstanding, fully paid and nonassessable and 50,000 shares
         of preferred stock, $0.01 par value per share, of which no shares are
         duly authorized and validly issued and outstanding, fully paid and
         nonassessable. Except as set forth on Schedule 3.1.5, no shares of
         capital stock of the Company or any of its subsidiaries have been
         reserved for any purpose. Except as set forth in the capitalization
         table attached hereto as Exhibit A, there are no outstanding securities
         convertible into or exchangeable for Common Stock or for the capital
         stock of any of the Company's subsidiaries and no outstanding options,
         rights (preemptive or otherwise), or warrants to purchase or to
         subscribe for any shares of such stock or other securities of the
         Company or any of its subsidiaries. Except as set forth in Schedule
         3.1.5, there are no outstanding agreements affecting or relating to the
         voting, issuance, purchase, redemption, repurchase or transfer of the
         Securities.

                  3.1.6    NO CONFLICT. The execution, delivery and performance
         of this Agreement by the Company does not and will not (i) violate,
         conflict with or result in the breach of any provision of its
         certificate of incorporation or bylaws, (ii) conflict with or violate
         any law, governmental regulation or governmental order applicable to it
         or any of its assets, properties or businesses or (iii) conflict with,
         result in any breach of, constitute a default (or event which with the
         giving of notice or lapse of time, or both, would become a default)
         under, require any consent under, or give to others any rights of
         termination, amendment, acceleration, suspension, revocation or
         cancellation of, or result in the creation of any encumbrance on any of
         the Company's assets or properties pursuant to, any note, bond,
         mortgage or indenture, contract, agreement, lease, sublease, license,
         permit, franchise or other instrument or arrangement to which the
         Company is a party or by which any of its assets or properties is bound
         or affected; except to the extent that any conflict under (ii) or (iii)
         above would not have a Material Adverse Effect on the Company and its
         subsidiaries taken as a whole, or prevent or materially delay the
         consummation of the transactions contemplated by this Agreement.

                  3.1.7    GOVERNMENT CONSENTS. Except as set forth in Schedule
         3.1.7, the execution, delivery and performance of this Agreement by the
         Company does not and will not require any consent, approval,
         authorization or other order of, action by, filing with or notification
         to any Governmental Authority.

                  3.1.8    PROCEEDINGS. Except as set forth in Schedule 3.1.8,
         there is no judicial or administrative action, suit, proceeding
         (whether adjudicatory, rule-making, licensing or otherwise) or
         investigation pending or, to the knowledge of the Company, threatened
         in law or equity against the Company relating to the Company or the
         transactions contemplated by this Agreement before any Governmental
         Authority, that would have a Material Adverse

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         Effect on the Company and its subsidiaries taken as a whole or on the
         ability of the Company to consummate the transactions contemplated
         hereby.

                  3.1.9    FINANCIAL CONDITION. The Company has previously
         delivered to CES the Company's unaudited balance sheet (the "Balance
         Sheet") as of December 31, 1999 (the "Balance Sheet Date"), which has
         been prepared in all material respects in accordance with generally
         accepted accounting principles ("GAAP") and presents fairly the
         financial condition of the Company as of December 31, 1999; PROVIDED
         that certain footnote disclosures, statements and other information
         which reflect significant accounting policies normally included in
         financial statements prepared in accordance with GAAP have been
         condensed or omitted.

                  3.1.10   ABSENCE OF CHANGE. Since December 31, 1999, there has
         not been any change, development, or effect on the Company that has had
         a Material Adverse Effect on the Company and its subsidiaries taken as
         a whole.

                  3.1.11   INFORMATION. The Company covenants that, until the
         consummation of an initial firm commitment underwritten public offering
         of shares of Common Stock registered under the Securities Act (the
         "Initial Public Offering"), it will deliver to CES:

                  (a)      as soon as practicable and in any event within thirty
         (30) days after the end of each calendar month, a report showing in
         reasonable detail the financial and operating performance and results
         for the prior calendar month;

                  (b)      as soon as practicable and in any event within sixty
         (60) days after the end of each quarterly period (other than the last
         quarterly period) in each fiscal year, consolidated statements of
         income, changes in stockholders' equity and changes in financial
         position of the Company for such quarterly period and for the period
         from the beginning of the current fiscal year to the end of such
         quarterly period, and a consolidated balance sheet of the Company as at
         the end of such quarterly period, all unaudited but prepared in
         accordance with GAAP on a basis consistent with past practice;

                  (c)      as soon as practicable and in any event within ninety
         (90) days after the end of each fiscal year, consolidated statements of
         income, changes in stockholders' equity and changes in financial
         position of the Company for such year, and a consolidated balance sheet
         of the Company as at the end of such year, in each case audited for the
         Company by independent public accountants of recognized national
         standing selected by the Company from among the five largest accounting
         firms in the United States, whose report shall state that such
         consolidated financial statements present fairly the results of
         operations, cash flows and financial position of the Company in
         accordance with GAAP on a basis consistent with prior periods except as
         noted therein and that the examination by such accountants has been
         made in accordance with generally accepted auditing standards; and

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                  (d)      as soon as practicable, and in any event within the
         applicable time period specified in the instructions to Form 8-K under
         the Securities Exchange Act, notice of any event that would be required
         to be reported on such form if the Company were then required to file
         such reports.

                  3.1.12.  CAPITALIZATION. The capitalization table attached
         hereto as EXHIBIT A accurately reflects the equity capitalization of
         the Company as of the date hereof without giving effect to any
         potential transactions or agreements for the issuance of securities
         which the Company may be currently negotiating with any third parties.

                  3.1.13.  CERTIFICATE OF INCORPORATION AND BYLAWS. The Company
         has previously furnished to CES a true and complete copy of the
         certificate of incorporation of the Company, as currently in effect,
         certified as of a recent date by the Secretary of State of the State of
         Delaware, and a true and complete copy of the bylaws of the Company, as
         currently in effect, certified by its corporate secretary.

                  3.1.14.  DISCLOSURE. The representations or warranties made by
         the Company in this Agreement, together with all written information
         provided to CES in connection with the transaction contemplated hereby,
         do not contain an untrue statement of a material fact or omit to state
         a material fact necessary to make the statements and facts contained
         herein or therein, in light of the circumstances in which they were or
         are made, not false or misleading.

         3.2      REPRESENTATIONS, WARRANTIES AND COVENANTS OF EES. EES
represents, warrants and convenants to CES that the following is true as of the
date hereof:

                  3.2.1    ORGANIZATION; GOOD STANDING. EES is a limited
         liability company validly existing and in good standing under the laws
         of the State of Delaware, and has the limited liability company power
         and authority to carry on its business as presently conducted.

                  3.2.2    AUTHORITY. EES has the power and authority to
         execute, deliver and perform its obligations under this Agreement and
         to consummate the transactions contemplated hereunder. The execution
         and delivery of this Agreement by EES, the performance by EES of its
         obligations hereunder, and the consummation by EES of the transactions
         contemplated hereby have been duly authorized by all requisite limited
         liability company action on the part of EES.

                  3.2.3    DUE EXECUTION AND ENFORCEABILITY. This Agreement has
         been duly executed and delivered by EES, and (assuming due
         authorization, execution and delivery by CES and the Company) this
         Agreement constitutes a legal, valid and binding obligation of EES,
         enforceable against it in accordance with its terms, except as such
         enforceability may be limited by applicable bankruptcy, insolvency,
         reorganization, moratorium or other laws of general application
         referring to or affecting enforcement of creditors' rights and general
         principles of equity.

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                  3.2.4    NO CONFLICT. The execution, delivery and performance
         of this Agreement by EES does not and will not (i) violate, conflict
         with or result in the breach of any provision of its organizational
         documents, (ii) conflict with or violate any law, governmental
         regulation or governmental order applicable to it or any of its assets,
         properties or businesses or (iii) conflict with, result in any breach
         of, constitute a default (or event which with the giving of notice or
         lapse of time, or both, would become a default) under, require any
         consent under, or give to others any rights of termination, amendment,
         acceleration, suspension, revocation or cancellation of, or result in
         the creation of any encumbrance on any of EES's assets or properties
         pursuant to, any note, bond, mortgage or indenture, contract,
         agreement, lease, sublease, license, permit, franchise or other
         instrument or arrangement to which EES is a party or by which any of
         its assets or properties is bound or affected; except to the extent
         that any conflict under (ii) or (iii) above would not have a Material
         Adverse Effect on EES and its subsidiaries taken as a whole, or prevent
         or materially delay the consummation of the transactions contemplated
         by this Agreement.

                  3.2.5    GOVERNMENT CONSENTS. The execution, delivery and
         performance of this Agreement by EES does not and will not require any
         consent, approval, authorization or other order of, action by, filing
         with or notification to any Governmental Authority.

                                   ARTICLE IV
                             TRANSFERS OF SECURITIES

         4.1      TRANSFERS BY CES. Any sale, assignment, exchange or other
transfer or disposition, direct or indirect (collectively, a "Transfer"), by CES
of any of its Securities shall be governed by this Agreement. CES may not
Transfer any portion of its Securities unless otherwise permitted by this
Article IV.

         4.2      TRANSFERS SUBJECT TO COMPLIANCE WITH SECURITIES ACT. CES
acknowledges that the Securities have not been registered under the Securities
Act and agrees that no sale, transfer, assignment, hypothecation or other
disposition of the Securities shall be made in the absence of (a) a current
registration statement under the Securities Act as to the Securities and the
registration or qualification of the Securities under any applicable state
securities laws that is then in effect or (b) an opinion of counsel reasonably
satisfactory to the Company to the effect that such registration or
qualification is not required PROVIDED, HOWEVER, that an opinion of counsel
shall not be required in connection with a Transfer by CES of the Securities
pursuant to Rule 144(k) of the Securities Act.

         4.3      RESTRICTIVE LEGENDS. Each certificate representing Securities
held by CES, and each certificate representing Securities issued to any
subsequent transferee, shall be stamped or otherwise imprinted with a legend in
substantially the following form:

                  THIS SECURITY IS SUBJECT TO RESTRICTIONS ON TRANSFER AND OTHER
         TERMS AND CONDITIONS SET FORTH IN THE SUBSCRIPTION AGREEMENT DATED AS
         OF JULY 31, 2000, A COPY OF WHICH MAY BE OBTAINED FROM THE COMPANY AT
         ITS PRINCIPAL EXECUTIVE OFFICES.

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                   THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN
         REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED ("SECURITIES
         ACT"), OR ANY STATE SECURITIES LAWS. SUCH SECURITIES MAY NOT BE OFFERED
         FOR SALE, SOLD, PLEDGED, TRANSFERRED, OR OTHERWISE DISPOSED OF IN THE
         ABSENCE OF (A) A CURRENT REGISTRATION STATEMENT UNDER THE SECURITIES
         ACT AS TO THE SECURITIES UNDER ANY APPLICABLE STATE SECURITIES LAWS
         THAT IS THEN IN EFFECT OR (B) AN OPINION OF COUNSEL REASONABLY
         SATISFACTORY TO THE COMPANY TO THE EFFECT THAT SUCH REGISTRATION OR
         QUALIFICATION IS NOT REQUIRED.

         4.4      LOCK-UP AGREEMENT. In connection with any Initial Public
Offering of Common Stock, CES agrees to enter into an agreement on such terms
as may be reasonably requested by the underwriters for the public offering
not to directly or indirectly, sell, transfer or otherwise dispose of or
transfer the economic benefits and burdens of, any of the Securities for a
period of time following such Initial Public Offering as such underwriter may
reasonably request but not to exceed 180 days, PROVIDED, HOWEVER, that the
terms of such agreement are no more onerous or restrictive than the least
restrictive restrictions imposed on holders of at least one-half of one
percent (0.5%) of the fully diluted shares of Common Stock at the time of the
Initial Public Offering and any officers or directors of the Company holding
Common Stock.

         4.5      CO-SALE PROVISIONS. EES agrees that until an Initial Public
Offering, CES will be entitled to such rights as are afforded by EES or an
Affiliate of EES (including, for purposes of this Section only, Cortez Energy
Services, LLC) to the third party investors who invested cash in the Company
pursuant to the Contribution Agreement (the "Investors") under the
Stockholders Agreement dated as of January 6, 2000, among the Company and
certain other parties, as such agreement is amended from time to time, to
include any Securities issued hereunder in any Transfer of Common Stock or
securities convertible into or exercisable for Common Stock ("Common Stock
Equivalents") by EES or its Affiliates (including, for purposes of this
Section only, Cortez Energy Services, LLC) to other parties. If the Investors
are permitted to include shares of Common Stock and Common Stock Equivalents
in connection with such a Transfer, then CES shall be entitled to include up
to that number of Securities equal to (i) the number of Securities held by
CES multiplied by (ii) a fraction the numerator of which is the number of
shares of Common Stock and Common Stock Equivalents the Investors are
entitled to sell in connection with such sale and the denominator of which is
the number of shares of Common Stock and Common Stock Equivalents calculated
on a fully-diluted basis then held by the Investors. The terms of such
Transfer shall be no less favorable than the terms of the Transfer by EES,
any Affiliate of EES or the Investors. CES shall not be required to make any
representations or warranties in connection with such Transfer other than
representations and warranties as to (i) CES's ownership of the Securities to
be Transferred free and clear of all liens, claims and encumbrances, (ii)
CES's power and authority to effect such Transfer and (iii) such matters
pertaining to compliance with securities laws as the transferee may
reasonably require. The closing of such purchase by the transferee shall be
on the same date that the transferee acquires shares from EES, or its
Affiliate, or the Investors that are selling; PROVIDED that CES is

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given 20 days advance notice of such closing.

         4.6      REGISTRATION RIGHTS.

         (a)      The Company agrees that after the effectiveness of an
Initial Public Offering (or such later date as applicable in accordance with
Section 4.4 hereof), CES will be entitled to piggyback registration rights to
include any shares of Common Stock issued hereunder (used herein, the
"Piggyback Securities") in any registration statement filed by the Company
with the Securities and Exchange Commission to register for sale shares of
Common Stock for cash in an underwritten offering under the Securities Act
(other than a registration statement on Form S-4 or Form S-8 or any successor
forms thereto or other than in connection with an exchange offer or offering
solely to the Company's existing security holders). Each time the Company
proposes to so file a registration statement with respect to which CES has
the right to request inclusion of Piggyback Securities, the Company shall
promptly give written notice of such proposed filing to CES and, upon the
written request by CES which shall be given to the Company within 10 days
after delivery by the Company of the notice of intent to file a registration
statement, CES may include in such registration Piggyback Securities (which
request by CES shall specify the number of Piggyback Securities proposed to
be included in such registration). The Company shall use commercially
reasonable efforts to cause all such shares of Piggyback Securities that CES
has requested to be included in such registration on the same terms and
conditions as the Common Stock otherwise being sold in such registration;
PROVIDED, HOWEVER, that if the managing underwriter or underwriter advises
the Company to reduce the number of shares of Common Stock to be sold and the
Company has the right to so reduce the number of shares included therein by
the Investors pursuant to the Stockholders Agreement, then the number of
Piggyback Securities included by CES shall be reduced at the same time the
number of shares included by the Investors are reduced on a pro rata basis
based on the number of Securities held by CES and the number of shares of
Common Stock calculated on a fully-diluted basis then held by the Investors
that requested the inclusion of shares in such registration. Notwithstanding
the foregoing, CES shall not have any piggyback registration rights with
respect to Securities that it may sell pursuant to Rule 144(k) (or any
successor provision) promulgated under the Securities Act or (if the
provisions would not result in any material limitation on CES's ability to
sell) otherwise pursuant to Rule 144 (or any successor provision) promulgated
under the Securities Act. The Company may suspend, terminate or withdraw a
piggyback registration at any time in its sole discretion.

         (b)      The Company shall pay the following registration expenses
(the "Registration Expenses"): (i) all registration and filing fees
(including, without limitation, with respect to filings to be made with the
National Association of Securities Dealers, Inc.), (ii) fees and expenses of
compliance with securities or blue sky laws (including reasonable fees and
disbursements of counsel in connection with blue sky qualifications of the
Piggyback Securities), (iii) printing expenses, (iv) internal expenses
(including, without limitation, all salaries and expenses of its officers and
employees performing legal or accounting duties), (v) the fees and expenses
incurred in connection with the listing on an exchange of the Piggyback
Securities if the Company shall choose to list such Piggyback Securities,
(vi) reasonable fees and disbursements of counsel for the Company and
customary fees and expenses for independent certified public accountants
retained by the Company,

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(vii) the reasonable fees and expenses of any special experts retained by the
Company in connection with such registration, and (viii) fees and expenses of
any "qualified independent underwriter" or other independent appraiser
participating in any offering pursuant to Section 3 of Schedule E to the
By-laws of the National Association of Securities Dealers, Inc. The Company
shall not have any obligation to pay any underwriting fees, discounts, or
commissions attributable to the sale of Piggyback Securities or, except as
provided by clause (ii) or (viii) above, any out-of-pocket expenses of CES
(or the agents who manage its accounts) or the fees and disbursements of any
underwriter.

                                    ARTICLE V
                               GENERAL PROVISIONS

         5.1      ENTIRE AGREEMENT; TERMINATION OF PRIOR AGREEMENT. This
Agreement contains the entire agreement among the parties with respect to the
subject matter hereof and supersedes all prior agreements, written or oral,
with respect thereto.

         5.2      WAIVERS AND AMENDMENTS. This Agreement may be amended,
superseded, canceled, renewed or extended only by a written instrument signed
by the parties hereto. The provisions hereof may be waived in writing by the
parties hereto. No delay on the part of any party in exercising any right,
power or privilege hereunder shall operate as a waiver thereof, nor shall any
waiver on the part of any party of any such right, power or privilege, nor
any single or partial exercise of any such right, power or privilege,
preclude any further exercise thereof or the exercise of any other such
right, power or privilege.

         5.3      REGISTRATION OF TRANSFERS. If, in the reasonable judgment
of counsel to the Company, a proposed Transfer by CES would constitute a
violation of this Agreement, then the Company may refuse to register such
proposed Transfer of Securities on the stock transfer records of the Company
and give related instructions to its stock transfer agent, if any, to stop
the registration of such proposed Transfer of Securities to the extent
reasonably necessary to avoid such violation.

         5.4      NOTICES.

         (a)      Any notice or other communication required or permitted
hereunder shall be in writing and shall be delivered personally by hand or by
recognized overnight courier, telecopied or mailed (by registered or
certified mail, postage prepaid) as follows:

                  (i)      If to CES, then to:

                                   Columbia Energy Services Corporation
                                   13880 Dulles Corner Lane
                                   Herndon, Virginia 20171-4600
                                   Attention: General Counsel
                                   Facsimile: (703) 561-7318

                                       11
<PAGE>

                  (ii)     If to the Company, then to:

                                   TNPC, Inc.
                                   10 Glenville Street
                                   Greenwich, Connecticut 06831
                                   Attention: Managing Director, Law and
                                              Government Affairs
                                   Facsimile: (203) 531-0404

                  (iii) with a copy to:

                                   Enron Energy Services, LLC
                                   1400 Smith Street
                                   Houston, Texas 77002
                                   Attention: General Counsel
                                   Facsimile: (713) 646-2379

         (b)      Each such notice or other communication shall be effective
(i) if given by telecopier, when such telecopy is transmitted to the
telecopier number specified in Section 5.4(a) (with confirmation of
transmission), or (ii) if given by any other means, when delivered at the
address specified in Section 5.4(a). Any party by notice given in accordance
with this Section 5.4 to the other party may designate another address (or
telecopier number) or person for receipt of notices hereunder. Notices by a
party may be given by counsel to such party.

         5.5      GOVERNING LAW.

         (a)      THIS AGREEMENT (INCLUDING, BUT NOT LIMITED TO, THE VALIDITY
AND ENFORCEABILITY HEREOF) SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE
WITH, THE LAWS OF THE STATE OF DELAWARE, WITHOUT GIVING EFFECT TO THE
CONFLICT OF LAWS RULES THEREOF.

         (b)      THE PARTIES AGREE THAT THE STATE OF DELAWARE SHALL HAVE
SOLE AND EXCLUSIVE JURISDICTION OVER ANY ACTION BROUGHT TO ENFORCE THE TERMS
OF THIS AGREEMENT AND THAT THE PARTIES HEREBY CONSENT TO SUITS IN THE COURTS
OF THE STATE OF DELAWARE AND WAIVE THE DEFENSES OF PERSONAL JURISDICTION,
SERVICE AND VENUE.

         5.6      SEVERABILITY. If any term, provision, covenant or
restriction of this Agreement is held by a court of competent jurisdiction to
be invalid, void or unenforceable, the remainder of the terms, provisions,
covenants and restrictions of this Agreement shall continue in full force and
effect and shall in no way be affected, impaired or invalidated so long as
the economic or legal substance of the transactions contemplated hereby is
not affected in any manner materially adverse to any party. Upon such
determination that any term, provision, covenant or restriction is invalid,
void or unenforceable, the parties hereto shall negotiate in good faith to
modify this Agreement so as to effect the original intent of the parties as
closely as possible in an acceptable manner to the end that

                                       12
<PAGE>

the transactions contemplated hereby are fulfilled to the fullest extent
possible.

         5.7      COUNTERPARTS. The Agreement may be executed in any number
of counterparts, each of which shall be deemed to be an original as against
any party whose signature appears thereon, and all of which shall together
constitute one and the same instrument. This Agreement shall become binding
when one or more counterparts hereof, individually or taken together, shall
bear the signatures of all of the parties reflected hereon as the signatories.

         5.8      ASSIGNMENT. This Agreement shall not be assigned by any
party without the express written consent of the other parties hereto (which
consent may be granted or withheld in the sole discretion of any party).

         IN WITNESS WHEREOF, the undersigned have executed this Agreement on
the date first written above.

                                   TNPC, INC.

                                   By: /s/ H.E. LOCKHART
                                      -------------------------------

                                   Name: H. E. Lockhart
                                        -----------------------------

                                   Title: CEO
                                         ----------------------------

                                   COLUMBIA ENERGY SERVICES
                                   CORPORATION

                                   By: /s/ DENNIS A. PICK
                                      -------------------------------

                                   Name: Dennis A. Pick
                                        -----------------------------

                                   Title: SVP
                                         ----------------------------

                                   ENRON ENERGY SERVICES, LLC

                                   By: /s/ MARK S. MULLER
                                      -------------------------------

                                   Name: Mark S. Muller
                                        -----------------------------

                                   Title: Managing Director
                                         ----------------------------

                                       13<PAGE>

                               SERVICES AGREEMENT

         This Services Agreement (this "Agreement") is entered into effective
as of July 31, 2000 ("Effective Date"), among The New Power Company, a
Delaware corporation ("New Power"), Columbia Energy Services Corporation, a
Kentucky corporation ("CES"), Columbia Energy Retail Corporation, a Delaware
corporation ("CERC"), and Columbia Energy Power Marketing Corporation, a
Delaware corporation ("CPMC") (each of CES, CERC and CPMC, a "Seller," and
collectively the "Sellers").

                                   WITNESSETH:

         WHEREAS, New Power, TNPC, Inc. and the Sellers have entered into
that certain Asset Purchase Agreement dated as of June 29, 2000 ("Purchase
Agreement"); and

         WHEREAS, in order to permit New Power to effect an efficient
transition of the control of the Second Closing Assets (as defined in the
Purchase Agreement) and to ensure a smooth transition of customers covered by
the Second Closing, New Power has agreed to provide certain services to the
Sellers on the terms and conditions set forth herein;

         NOW, THEREFORE, for good and valuable consideration, receipt of
which is hereby acknowledged, and in consideration of the premises and mutual
covenants contained herein, New Power and the Sellers agree as follows:

                                    ARTICLE 1
                                   DEFINITIONS

         1.1 DEFINITIONS. All capitalized terms not defined herein shall have
the meanings given such terms in the Purchase Agreement. The following
capitalized terms shall be used in this Agreement with the meanings set forth
in this Section 1.1:

         "DISPUTED CLAIMS" has the meaning set forth in Article 10 of this
Agreement.

         "DISPUTE DEADLINE DATE" has the meaning set forth in Section 2.6(c)
of this Agreement.

         "EFFECTIVE DATE" has the meaning set forth in the introduction to
this Agreement.

         "FORWARD TRANSACTIONS" shall mean all forward term physical supply,
transportation capacity and storage transactions of at least 30 days in
nature entered into by New Power after the Closing Date, in connection with
its provision of Risk Management Consulting Services pursuant to SCHEDULE I
and in anticipation of becoming the Service Provider for the Second Closing
Customers.

         "NEW POWER REPRESENTATIVE" has the meaning set forth in Section 4.3
of this Agreement.

         "PRIME RATE" shall mean, as of any date of determination, the
interest rate published by The Wall Street Journal, Eastern Edition, on such
day in its Money Rates section as the "Prime Rate";

                                      -1-
<PAGE>

PROVIDED that if no such rate is published on that day the interest rate
published on the preceding day shall apply.

         "REGULATORY CONSULTING SERVICES" are those services listed on
Schedule I relating to assets over which FERC or a PUC has jurisdiction
pursuant to Applicable Law or assets over which utility tariff provisions
apply.

         "REIMBURSEMENT AMOUNT" has the meaning set forth in Section 2.6(a)
of this Agreement.

         "REIMBURSEMENT AMOUNT STATEMENT" has the meaning set forth in
Section 2.6(c) to this Agreement.

         "RISK MANAGEMENT CONSULTING SERVICES" means the services listed on
Schedule I as Risk Management Consulting Services.

         "SECOND CLOSING CUSTOMERS" means those Mass Markets Customers
included in the Second Closing Assets.

         "SECOND CLOSING DATE" means the date on which the Second Closing
occurs.

         "SECOND CLOSING DROP-DEAD DATE" means January 31, 2001.

         "SELLERS REPRESENTATIVE" has the meaning set forth in Section 4.3 of
this Agreement.

         "SERVICES" means the services described on the attached SCHEDULE I
provided by New Power to the Sellers in accordance with the terms of this
Agreement.

         "SERVICES HEDGES" shall mean all non-physical and financial
transactions with third parties to hedge or fix natural gas or electricity
supply costs entered into by New Power after the Closing Date, in connection
with its supply of natural gas and electricity pursuant to SCHEDULE I and in
anticipation of becoming the Service Provider for the Second Closing
Customers.

         "TAXES" any transactional tax imposed on the Sellers with respect to
a customer transaction whether separately stated on the invoice or included
as part of the commodity or transportation charge as currently imposed or
which become effective during the term of this Agreement. Taxes does not
include taxes based on or measured by the net income of the Sellers, but does
include sales and use tax, gross receipts tax, utility excise taxes, energy
taxes and other similar levies.

         "TERM" shall have the meaning set forth in Section 3.1.

                                    ARTICLE 2
                                    SERVICES

         2.1 SERVICES. Subject to the terms and conditions of this Agreement,
the Sellers hereby engage New Power as set forth below, on an exclusive
basis, to provide the Services with respect to the Second Closing Assets;
provided that (i) New Power shall not have control or decision making

<PAGE>

authority over any of the Sellers' facilities that are subject to the
jurisdiction of FERC or any PUC; (ii) all Services and all transactions and
agreements that New Power enters into in providing the Services (whether in
its own name or in the Sellers' names) shall be performed on behalf of the
Sellers; (iii) in providing the Services, New Power shall not act for its own
account (notwithstanding that New Power may enter into transactions in its
own name on behalf of the Sellers) but shall be acting for the account of the
Sellers; and (iv) notwithstanding anything in this Agreement to the contrary,
New Power shall not be required to provide any Service or take any action
that would violate any Applicable Law or that is not directly related to
servicing of the Second Closing Assets. Nothing in this Agreement shall
prohibit New Power from entering into and consummating transactions for its
own account or for the account of third parties and not related to the
provision of the Services.

         2.2 CHANGE IN THE SCOPE OF SERVICES. The occurrence of (a) any event
or transaction (other than events or transactions that are contemplated under
the Purchase Agreement, including the addition of customers in the current
Jurisdiction), or (b) any change in any Applicable Laws that in either case
(i) expands the scope of the Services beyond those related to the Second
Closing Assets or (ii) prohibits or materially impairs New Power from
providing the Services shall be considered a change in the scope of services,
and upon such changes in the scope of services, New Power and the Sellers
shall promptly meet to negotiate and execute an equitable adjustment to the
terms of this Agreement. Until the adjustment of the terms (including
possibly payments) in connection with such change is agreed upon by the
parties in writing, New Power shall have no obligation to provide any
Services beyond the scope of services that was in effect under this Agreement
prior to any change of the type described in the first sentence of this
Section 2.2, except to the extent that the failure of New Power to provide
any such Services would result in a violation or breach of Applicable Laws by
either New Power or the Sellers.

         2.3 ACCESS TO INFORMATION. The Sellers shall provide New Power with
access to any information pertaining to the Sellers business that is
necessary or appropriate to New Power's performance of its obligations under
this Agreement. The Sellers hereby grants to New Power a non-transferable,
royalty-free license to use the intellectual property of the Sellers solely
for the limited purposes of providing the Services and the performance of New
Power's obligations under this Agreement; provided that such license shall
terminate upon the termination of all of the Services to be provided under
this Agreement. New Power shall protect and shall cause its representatives
to protect any information it receives pursuant to this Section 2.3 from
disclosure to others, using the same degree of care used to protect its own
confidential or proprietary information of like importance but in any case
using no less than a reasonable degree of care.

         2.4 SEPARATE BOOKS. New Power and the Sellers each agree to maintain
such books and records with respect to the Services provided by New Power to
the Sellers as are necessary or appropriate to fulfill their respective
responsibilities under this Agreement and to comply with Applicable Law. The
Sellers and New Power shall each have the right, during normal business
hours, to inspect any and all such books and records of the other party to
the extent necessary to substantiate the provision of such Services; provided
that in no event shall the Sellers have the right to inspect or review (a)
New Power's valuation of the Sellers' commodity positions; (b) New Power's
analysis of forward pricing curves; or (c) any other proprietary information
used to prepare commodity or customer pricing.

<PAGE>

         2.5 SERVICES LIMITED TO THE SELLERS. The Sellers shall not
subcontract, sublicense or resell any Service provided hereunder to any other
Person. New Power shall not be restricted in any manner whatsoever from
providing any services to other Persons which are the same as, similar to or
different from the Services provided to the Sellers pursuant to this
Agreement; PROVIDED, HOWEVER, that New Power shall protect and shall cause
its representatives to protect any information from disclosure to others,
using the same degree of care used to protect its own confidential or
proprietary information of like importance but in any case using no less than
a reasonable degree of care.

         2.6  REIMBURSEMENT AMOUNT.

                  (a) In accordance with Section 2.6(b) below, the Sellers shall
         pay to New Power as sole consideration for the provision of services
         (except as provided in Schedule I, Section VI) the amount
         ("Reimbursement Amount") equal to (i) the gross amounts received by the
         Sellers in payment of amounts billed Second Closing Customers under
         Specified Contracts less (ii) any Taxes payable by the Sellers with
         respect to such receipts.

                  (b) The Reimbursement Amount shall be paid by the Sellers to
         New Power on or before the 15th day and last day of each calendar month
         during the Term. All such payments shall be made by wire transfer to
         the bank account (and in accordance with the wire transfer
         instructions) set forth on Schedule 2.6 hereto or to such other account
         designated by New Power pursuant to Article 9 hereof.

                  (c) As promptly as practicable after the termination of the
         Term pursuant to clause (ii) or clause (iii) of Section 3.1 (after
         giving effect to the extension of the Term, if any provided in Section
         3.1) and in any event not later than 15 days after such termination,
         the Sellers shall deliver to New Power (i) a statement of the
         Reimbursement Amount ("Reimbursement Amount Statement") showing in
         reasonable detail the calculation of the Reimbursement Amount. The
         Reimbursement Amount Statement shall become final and binding on the
         Sellers and New Power as to the Reimbursement Amount on the 30th day
         following the date the Reimbursement Amount Statement is received by
         New Power (the "Dispute Deadline Date"), unless prior to the Dispute
         Deadline Date New Power delivers notice to the Sellers of its
         disagreement. All undisputed amounts shall be due and payable on the
         Dispute Deadline Date. New Power's notice shall set forth all of New
         Power's disputed items together with New Power's proposed changes
         thereto, including an explanation in reasonable detail of the basis on
         which New Power proposes such changes. If New Power has delivered a
         timely notice of the disputed amount, then New Power and the Sellers
         shall use their good faith efforts to reach written agreement on the
         disputed items to determine the disputed Reimbursement Amount. If New
         Power and the Sellers are unable to reach such an agreement, then the
         matter shall be resolved in accordance with the terms of Article 10.
         Upon resolution of any dispute, the Sellers shall pay any amount due
         plus interest on such amount from the original due date until the date
         paid at the Prime Rate.

         2.7 RISK MANAGEMENT CONSULTING SERVICES. All Risk Management Consulting
Services shall be provided on a consulting basis only, and New Power shall have
no obligation for the underlying position, if any, taken by the Sellers with
respect to the Risk Management Consulting Services or otherwise, or from
consequences from the Sellers' implementation of any recommendations by New

<PAGE>

Power. New Power shall not be required to register as a commodities trading
advisor or obtain any other registrations or qualifications in order to
provide any Risk Management Consulting Services, and such Services may be
limited in that regard.

         2.8 FORWARD TRANSACTIONS. In the event the Term terminates pursuant
to clause (ii) or (iii) of Section 3.1 hereof or this Agreement is terminated
pursuant to Article 7 hereof, New Power shall promptly elect by written
notice for the parties to undertake one of the following: (i)(A) New Power
shall assign and the Sellers shall assume New Power's position under all
Forward Transactions (or, if the Closing shall occur but not the Second
Closing, the Forward Transactions relating to any Delay Closing Assets and
Delay Closing Liabilities not transferred to and assumed by New Power as of
the effective date of termination of this Agreement and the Second Closing
Assets and Second Closing Liabilities), and (B) the Sellers shall pay to New
Power, New Power's costs under all Forward Transactions (or, if the Closing
shall occur but not the Second Closing, the Forward Transactions relating to
any Delay Closing Assets and Delay Closing Liabilities not transferred to and
assumed by the New Power as of the effective date of termination of this
Agreement and the Second Closing Assets and Second Closing Liabilities) or
(ii) the Sellers shall pay to New Power or New Power shall pay to the
Sellers, as applicable, an amount which would have had the same economic
consequences to the Sellers had the transactions contemplated by the
preceding clause (i)(A) been consummated; PROVIDED, HOWEVER, in any event
that the Forward Transactions entered into by New Power after the Closing
Date shall be entered into in good faith and shall be entered into on
commercially reasonable terms and conditions.

         2.9 HEDGES. In the event the Term terminates pursuant to clause (ii)
or (iii) of Section 3.1 hereof or this Agreement is terminated pursuant to
Article 7 hereof, New Power shall promptly elect by written notice for the
parties to undertake one of the following: (i)(A) New Power shall assign and
the Sellers shall assume New Power's position under all Service Hedges (or,
if the Closing shall occur but not the Second Closing, the Service Hedges
relating to any Delay Closing Assets and Delay Closing Liabilities not
transferred to and assumed by New Power as of the effective date of
termination of this Agreement and the Second Closing Assets and Second
Closing Liabilities), and (B) the Sellers shall pay to New Power, New Power's
costs under all Service Hedges (or, if the Closing shall occur but not the
Second Closing, the Service Hedges relating to any Delay Closing Assets and
Delay Closing Liabilities not transferred to and assumed by the New Power as
of the effective date of termination of this Agreement and the Second Closing
Assets and Second Closing Liabilities) or (ii) the Sellers shall pay to New
Power or New Power shall pay to the Sellers, as applicable, an amount which
would have had the same economic consequences to the Sellers had the
transactions contemplated by the preceding clause (i)(A) been consummated;
PROVIDED, HOWEVER, in any event that the Service Hedges entered into by New
Power after the Closing Date shall be entered into in good faith and shall be
entered into on commercially reasonable terms and conditions.

         2.10 CONFIDENTIALITY. In addition to any non-disclosure requirements
set forth in Section 2.3 above, each party hereby agrees that all non-public,
confidential or proprietary information communicated to it by the other
party, whether before or after the date of this Agreement, shall be and was
received in strict confidence, shall be used only for purposes of this
Agreement, and, for a period of two (2) years following the termination of
this Agreement, shall not be disclosed by such party, its agents or employees
without the prior written consent of the other party, except as may be
necessary by reason of legal, accounting or regulatory requirements beyond
the reasonable control of the disclosing party. The obligations set forth in
this Section shall survive termination of this

<PAGE>

Agreement. Each party agrees that this restriction shall not apply to any
information which is (1) independently developed by the receiving party or
(2) otherwise in such party's possession through no breach of this
restriction by the receiving party or (3) otherwise in the public domain.

                                    ARTICLE 3
                                      TERM

         3.1 TERM. The respective Services to be provided under this
Agreement shall commence on the Closing Date and shall automatically
terminate without further action by any party (unless extended or sooner
terminated in writing) upon the earlier of (i) the Second Closing Date, (ii)
the termination of the Purchase Agreement or (iii) the Second Closing
Drop-Dead Date (the "Term").

         3.2 TRANSITION SERVICES. If the Term shall terminate pursuant to
clause (ii) of Section 3.1, New Power shall continue to provide the Services
through the date 60 days after the effective date of termination. If the Term
shall terminate pursuant to clause (iii) of Section 3.1, New Power shall
continue to provide the Services through the date 60 days after the Second
Closing Drop-Dead Date.

                                    ARTICLE 4
                                    PERSONNEL

         4.1 NEW POWER PERSONNEL. New Power shall provide all personnel
required and appropriate to render the Services in accordance with the
provisions of this Agreement. All personnel provided by New Power pursuant to
this Agreement shall be New Power's employees, contractors or agents, and in
no event shall such personnel be deemed employees of the Sellers. New Power
may provide Services using New Power's permanent employees, contract
employees or vendor employees as New Power shall deem appropriate for the
work being performed. New Power shall make all staffing decisions necessary
to perform the Services under this Agreement. Subject to the last two
sentences of Section 4.2, New Power reserves the right to assign all New
Power's personnel to perform the Services, and to replace or reassign such
New Power personnel at any time.

         4.2 POLICIES AND PROCEDURES REGARDING NEW POWER PERSONNEL. New Power
shall have full control over and responsibility for the assignment and
performance of employees providing the Services to the Sellers and for the
terms and conditions of employment of such employees including hiring,
transferring, salary, wages, benefits, work, shift scheduling, disciplining
and all other matters related to terms and conditions of employment. New
Power shall comply with, and shall cause their respective employees to comply
with, the Sellers' policies and procedures applicable to such personnel in
connection with the performance of the Services. In the event any of New
Power's personnel fails or refuses to comply with any of the Sellers'
applicable policies or procedures and the Sellers determine in their
commercially reasonable judgment that such failure or refusal could have an
adverse effect on any Seller's business, the Sellers shall notify New Power
promptly of such determination. Thereafter, New Power and the Sellers agree
to consult regarding the reassignment or replacement of such New Power
personnel in order to assure compliance with the Sellers' applicable policies
and procedures in connection with the performance of the Services.

         4.3 SELLERS AND NEW POWER REPRESENTATIVES. The Sellers will, at all
times when New Power is providing the Services, designate a representative or
representatives of the Sellers available either by telephone, pager or in
person to receive communications from New Power regarding the Services,

<PAGE>

as well as any other information. The initial representative of the Sellers
(the "Sellers Representative") is named in EXHIBIT A. The Sellers will vest
the Sellers Representative with sufficient responsibility and authority for
necessary decisions or expenditures to facilitate the timely, responsible and
effective rendering of the Services by New Power in accordance with the
provisions of this Agreement (including the primary responsibility and
authority to transact and interface on the Sellers' behalf with LDCs, PECO
and PUCs), and New Power will rely on the Sellers Representative having such
responsibility and authority. Similarly, New Power will, at all times when
New Power is providing the Services, designate a representative or
representatives of New Power available either by telephone, pager or in
person to receive communications from the Sellers regarding the Services, as
well as any other information. The initial New Power representative (the "New
Power Representative") is named in EXHIBIT A. New Power will vest the New
Power Representative with sufficient responsibility and authority for
necessary decisions or expenditures to facilitate the timely, responsible and
effective rendering of the Services by New Power in accordance with the
provisions of this Agreement, and the Sellers will rely on the New Power
Representative having such responsibility and authority.

                                    ARTICLE 5
                            SELLERS' RESPONSIBILITIES

         5.1 COOPERATION. The Sellers shall reasonably cooperate with New
Power by executing any documents, providing information and taking any
actions reasonably necessary to assist New Power with respect to the
provision of Services by New Power.

         5.2 RESPONSIBILITIES OF THE SELLERS. The responsibilities and
obligations of the Sellers under and pursuant to this Agreement shall be the
following:

                  (a) LEGALITY AND LIABILITY OF TRANSACTIONS. The legality of
         all transactions with third parties will remain the responsibility of
         the Sellers, except for transactions entered into as a direct result of
         decisions made solely by New Power without the knowledge of the Sellers
         Representative. New Power and its Affiliates assume no responsibility
         under this Agreement for performance either by third party suppliers of
         goods and services to the Sellers or by the Sellers under contracts or
         agreements, formal or informal, between the Sellers and third parties.
         New Power and its Affiliates assume no liability under this Agreement
         for the performance or quality of any product or service purchased on
         behalf of the Sellers and the Sellers shall have no recourse under this
         Agreement against New Power or its Affiliates with regard to such
         products or services. The Sellers shall retain all legal or equitable
         rights and remedies available to them as against any such third party.

                  (b) MANAGEMENT ACTION. Upon reasonable request, the Sellers
         shall promptly make available to New Power copies of all management
         decisions, instructions, approvals, acceptances and such other
         information and assistance desired or required by New Power to perform
         its obligations under this Agreement.

                  (c) TAXES AND INTEREST. The Sellers shall pay all taxes and
         interest and file all necessary documentation and returns related to or
         arising from the Sellers' transactions for which the Services are
         performed. In addition, the Sellers shall be solely responsible for the

<PAGE>

         payment of any taxes and duties, other than taxes due by New Power on
         net income, based upon the facilities, assets, Services and/or products
         provided by New Power or its Affiliates arising from this Agreement,
         and the Sellers shall be solely responsible for preparing and filing
         all documentation and returns related thereto.

                  (d) INTERNAL CONTROLS AND POLICIES. The Sellers shall be
         solely responsible for establishing and maintaining effective internal
         control, accounting systems and policies with regard to all the
         Sellers' transactions executed in connection with or in performance of
         the Services. The Sellers shall timely communicate such internal
         controls and policies to New Power prior to performance of the Services
         by New Power.

         5.3 ACCESS. Consistent with the provisions contained in Section 7.10
of the Purchase Agreement and beginning on the Effective Date, (i) the
Sellers shall provide New Power with the use of, and with reasonable access
to, the Sellers' facilities as may be required by New Power to perform or to
prepare to perform the Services and (ii) the Sellers shall provide to New
Power the Data Center Services described in Schedule 7.10 of the Purchase
Agreement at the Sellers' facilities.

         5.4 RISK OF LOSS. The Sellers shall bear all risk of loss arising
out of or resulting from (i) any transactions entered into by New Power on
behalf of the Sellers at the Sellers' written instruction that were
specifically opposed in writing by New Power; and (ii) any services, goods,
or products unrelated to the Services that are provided by the Sellers or any
third party.

                                    ARTICLE 6
                  STANDARD OF CARE AND LIMITATION OF LIABILITY

         6.1 STANDARD OF CARE AND DISCLAIMERS AS TO SERVICES. WITH RESPECT TO
ANY SERVICE PROVIDED HEREUNDER, EACH PARTY HERETO AGREES TO USE THE SAME DEGREE
OF CARE AS IT WOULD IN CONDUCTING SUCH SERVICES FOR ITS OWN ACCOUNT. OTHER THAN
AS EXPRESSLY SET FORTH IN THIS SECTION 6.1, EACH PARTY HERETO DISCLAIMS AND
NEGATES ANY GUARANTY OR WARRANTY, EXPRESS OR IMPLIED, INCLUDING BUT NOT LIMITED
TO, ANY WARRANTIES COVERING FITNESS FOR A PARTICULAR PURPOSE, NON-INFRINGEMENT,
OR OTHERWISE.

         6.2 LIMITATION OF LIABILITY. NOTWITHSTANDING ANYTHING CONTAINED TO THE
CONTRARY IN ANY PROVISION OF THIS AGREEMENT, THE PARTIES AGREE THAT THE RECOVERY
BY ANY PARTY HERETO OF ANY DAMAGES SUFFERED OR INCURRED BY IT AS A RESULT OF ANY
BREACH BY THE OTHER PARTY OF ANY OF ITS REPRESENTATIONS, WARRANTIES, COVENANTS
OR OBLIGATIONS OR ANY OTHER MATTER OR CLAIM UNDER THIS AGREEMENT SHALL BE
LIMITED TO THE ACTUAL DAMAGES SUFFERED OR INCURRED BY SUCH PARTY, AND IN NO
EVENT SHALL EITHER PARTY BE LIABLE TO THE OTHER PARTY FOR ANY INDIRECT,
CONSEQUENTIAL, SPECIAL, EXEMPLARY OR PUNITIVE DAMAGES EXCEPT TO THE EXTENT SUCH
EXCLUDED DAMAGES CONSTITUTE PART OF A THIRD PARTY CLAIM SUFFERED OR INCURRED BY
A PARTY FOR WHICH SUCH PARTY IS ENTITLED TO INDEMNIFICATION HEREUNDER.

<PAGE>

                                    ARTICLE 7
                                     DEFAULT

         7.1 DEFAULT BY SELLERS. The failure of the Sellers to perform or
observe any of their material obligations contained herein within 10 days
after written notice from New Power of such failure shall constitute an event
of default by Sellers hereunder. Upon receiving written notice of any
default, the Sellers will promptly use commercially reasonable efforts to
cure such default as soon as practicable if it is capable of being cured.

         7.2 NEW POWER REMEDIES. Subject to the terms of this Agreement, New
Power shall have the right, immediately after the occurrence of an event of
default by the Sellers, to take the following actions, which are not
exclusive but are cumulative: (a) seek monetary damages; (b) invoke any
remedy allowed at law or in equity or otherwise; or (c) terminate this
Agreement. New Power hereby waives any and all claims against the officers,
directors, stockholders, employees, agents and representatives of the Sellers
for all claims arising from a default by the Sellers under this Agreement.

         7.3 DEFAULT BY NEW POWER. The failure of New Power to perform or
observe any of its material obligations contained herein within 10 days after
written notice from Sellers of such failure shall constitute an event of
default hereunder. Upon receiving written notice of any default, New Power
will promptly use commercially reasonable efforts to cure such default as
soon as practicable if it is capable of being cured.

         7.4 SELLERS' REMEDIES. Subject to the terms of this Agreement, the
Sellers shall have the right, immediately after the occurrence of an event of
default by New Power, to take the following actions, which are not exclusive
but are cumulative: (a) seek monetary damages; (b) invoke any remedy allowed
at law or in equity or otherwise; or (c) terminate this Agreement. The
Sellers hereby waives any and all claims against the officers, directors,
stockholders, employees, agents and representatives of New Power for all
claims arising from a default by New Power under this Agreement.

         7.5 SURVIVAL. The provisions of Sections 2.10, 5.2(a) and (c),
Section 5.4 and Articles 6, 7, 8, and 10 hereof shall survive the termination
of this Agreement for any reason.

                                    ARTICLE 8
                                 INDEMNIFICATION

         8.1 NEW POWER'S AGREEMENT TO INDEMNIFY. New Power shall defend,
indemnify and hold harmless the Sellers and the Sellers' Affiliates, and
their respective officers, directors, shareholders, employees, agents,
successors and permitted assigns ("Seller Indemnified Parties") from and
against any and all Claims that relate to or result from: (a) the negligence,
gross negligence, or willful misconduct of New Power or (b) New Power's
breach of or default under any provision of this Agreement except, in each
case, to the extent such Losses arise from or relate to any Seller's
negligence, gross negligence or willful misconduct. New Power shall reimburse
the Seller Indemnified Parties for any legal or other expenses reasonably
incurred by the Seller Indemnified Parties in connection with investigating
or defending any such claim as such expenses are incurred.

<PAGE>

         8.2 SELLERS' AGREEMENT TO INDEMNIFY. The Sellers jointly and
severally shall defend, indemnify and hold harmless New Power, New Power's
Affiliates, and their respective officers, directors, shareholders,
employees, agents, successors and permitted assigns ("New Power Indemnified
Parties") from and against any and all Claims that relate to or result from:
(a) the negligence, gross negligence, or willful misconduct of any Seller or
(b) any Seller's breach of or default under any provision of this Agreement
except, in each case, to the extent such Losses arise from or relate to New
Power's negligence, gross negligence or willful misconduct. The Sellers shall
reimburse the New Power Indemnified Parties for any legal or other expenses
reasonably incurred by the New Power Indemnified parties in connection with
investigating or defending any such claim as such expenses are incurred.

         8.3  Claim Notice.

                  (a) INDEMNIFIED PARTIES. As used in this Article, the term
         "Indemnified Party" shall mean any Seller Indemnified Party or any New
         Power Indemnified Party, as the case may be, which is asserting a claim
         for indemnity hereunder. Any party against whom a claim for
         indemnification is asserted by an Indemnified Party pursuant to this
         Article is referred to herein as an "Indemnifying Party." In the event
         that any Claims are asserted against or sought to be collected from an
         Indemnified Party by a person who is not a Buyer Indemnified Party or a
         Seller Indemnified Party (a "Third Party"), such Indemnified Party
         shall give prompt notice to the Indemnifying Party of such event
         ("Claim Notice"). A Claim Notice shall specify, to the extent known by
         the Indemnified Party, the nature of and specific basis for any Claims
         or the nature of and specific basis of any suit, action, investigation
         or proceeding set forth therein and the amount or the estimated amount
         thereof to the extent then practicable. Any failure on the part of any
         Indemnified Party promptly to provide a Claim Notice to the
         Indemnifying Party shall relieve the Indemnifying Party of such party's
         obligation under this Article only to the extent that the Indemnifying
         Party shall have been prejudiced by the lack of timely and adequate
         notice to the Indemnifying Party.

                  (b) NOTICE REQUIRED. The Indemnifying Party shall have 30 days
         from the delivery or receipt of a Claim Notice ("Notice Period") to
         notify the Indemnified Party (i) whether or not it disputes the
         liability of the Indemnifying Party to the Indemnified Party hereunder
         with respect to the Claims identified in the Claim Notice, and (ii)
         whether or not it desires to assume the defense of the Third Party
         Claim identified in the Claim Notice; provided, however, that any
         Indemnified Party is hereby authorized during the Notice Period to file
         any motion, answer or other pleading that shall be necessary or
         appropriate to protect its interest or those of the Indemnifying Party.
         In the event that the Indemnifying Party notifies the Indemnified Party
         within the Notice Period that it desires to defend the Indemnified
         Party against the Claims identified in the Claims Notice, the
         Indemnifying Party shall have the right and obligation, at its sole
         cost and expense, to defend with counsel of its own choosing by all
         appropriate proceedings, which proceedings shall be properly and
         diligently settled or prosecuted to a final non-appealable order of a
         court of competent jurisdiction; provided, however, that (a) the
         Indemnified Party shall at all times have the right, at its sole option
         and expense, to employ separate counsel and to participate fully in the
         defense, compromise or settlement thereof, and (b) if the Indemnifying
         Party does not proceed diligently to defend the Claim within 30 days
         after personal delivery or receipt of a Claim Notice, the Indem-

<PAGE>

         nified Party shall have the right, but not the obligation, to undertake
         the defense of any such Claim and the Indemnifying Party shall be bound
         by any defense or settlement that the Indemnified Party may make as to
         such Claim. Upon its assumption of the defense of any such Claim, the
         Indemnifying Party shall have full control of such defense and
         proceedings including any compromise or settlement thereof. If there is
         more than one Indemnifying Party, then all Indemnifying Parties must
         coordinate the defense of the Indemnified Party against any Claims so
         as not adversely to affect the Indemnified Party's right to a proper
         defense.

                  (c) COOPERATION. The parties agree reasonably to cooperate
         with one another and their respective counsel in contesting and
         defending any Claim by a Third Party (including granting reasonable
         access to the pertinent books, records and personnel in their
         possession or control, or in the possession or control of the Sellers)
         or, if appropriate and related to the Claim in question, in making (i)
         any counterclaim against the Third Party asserting the Claims, or (ii)
         any cross complaint against any Person.

                  (d) NO SETTLEMENT. Notwithstanding anything in this Section to
         the contrary, the Indemnifying Party shall not, without the written
         consent of the Indemnified Party (i) settle or compromise any Claim or
         consent to the entry of any judgment with respect to such Claim that
         does not include as an unconditional term thereof the delivery by the
         claimant or plaintiff to the Indemnified Party of a written release
         from all liability in respect to such Claim, (ii) settle or compromise
         any Claim in any manner that may materially and adversely affect the
         Indemnified Party, or (iii) settle or compromise any Claim in a manner
         that will require the Indemnified Party to pay any money.

                  (e) RIGHTS OF INDEMNIFIED PARTY TO DEFEND. If the Indemnifying
         Party fails to notify the Indemnified Party within the Notice Period
         that the Indemnifying Party elects to defend the Indemnified Party
         pursuant to Section 8.3(b), or if the Indemnifying Party elects to
         defend the Indemnified Party pursuant to Section 8.3(b), but fails
         diligently and promptly to prosecute, defend or settle any Claim by a
         Third Party, then the Indemnified Party shall have the right to defend,
         or compromise and settle at the sole cost and expense of the
         Indemnifying Party, such Claim by a Third Party by all appropriate
         proceedings, which proceedings may be prosecuted by the Indemnified
         Party to a final non-appealable order of a court of competent
         jurisdiction or settled without the consent of the Indemnifying Party.
         The Indemnified Party shall have full control of such defense and
         proceedings.

                  (f) DIRECT CLAIMS. In the event any Indemnified Party should
         have a Claim against any Indemnifying Party hereunder that does not
         involve damages being asserted against or sought to be collected from
         it by a Third Party, the Indemnified Party shall send a Claim Notice
         containing the same type of information required by Section 8.3(a) with
         respect to such Claim to the Indemnifying Party. If the Indemnifying
         Party does not notify the Indemnified Party within the Notice Period
         that it disputes such Claim, the amount of such damages shall be
         conclusively deemed a liability of the Indemnifying Party hereunder.

<PAGE>

                                    ARTICLE 9
                                     NOTICES

         Any notice, request, instruction, correspondence or other documents
required or permitted hereunder shall be made in accordance with Section 15.1 of
the Purchase Agreement.

                                   ARTICLE 10
                           GOVERNING LAW; ARBITRATION

         THIS AGREEMENT (INCLUDING, BUT NOT LIMITED TO, THE VALIDITY AND
ENFORCEABILITY HEREOF) SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH,
THE LAWS OF THE STATE OF DELAWARE, OTHER THAN THE CONFLICT OF LAWS RULES
THEREOF.

         Except as specified in Section 2.6, any and all claims, counterclaims,
demands, cause of action, disputes, controversies, and other matters in question
arising under this Agreement or the alleged breach of any provision hereof (all
of which are referred to herein as "Disputed Claims"), whether such Disputed
Claims arise at law or in equity, under state or federal law, for damages or any
other relief, shall be resolved by binding arbitration in the manner set forth
in Article XIV of the Purchase Agreement.

                                   ARTICLE 11
                                   ASSIGNMENT

         11.1 ASSIGNMENT. This Agreement and all of its provisions, rights and
obligations shall be binding upon and shall inure to the benefit of the parties
hereto and their respective permitted successors and assigns. This Agreement may
not be assigned (including by operation of law) by any party (other than an
assignment by New Power to any Affiliate thereof) without the prior written
consent of the other party, and any purported assignment (other than an
assignment by New Power to any Affiliate thereof), unless so consented to, shall
be void and without effect. Nothing herein express or implied is intended or
shall be construed to confer upon or to give anyone other than the parties
hereto and their respective permitted successors and assigns of any rights or
benefits under or by reason of this Agreement, and no other party shall have any
right to enforce any of the provisions of this Agreement.

                                   ARTICLE 12
                                     GENERAL

         12.1 ENTIRE AGREEMENT. This Agreement and the Purchase Agreement
constitute the entire agreement between New Power and the Sellers with respect
to the subject matter hereof and supersedes all prior agreements and
understandings, whether oral or written, among the parties with respect to the
subject matter hereof. New Power makes no representations to the Sellers except
as expressly set forth herein.

         12.2 FORCE MAJEURE. No party shall be liable for a delay in the
performance of its obligations and responsibilities under this Agreement due to
causes beyond its reasonable control,

<PAGE>

including, but not limited to, failures or delays in transportation or
communication, failures or substitutions of equipment, labor disputes,
accidents, fuel, raw materials or equipment or technical failures. The delayed
party shall take reasonable measures to notify the other party in writing of the
delay. The time for completion of any obligation to which this provision applies
shall be extended for a period equivalent to the delay, provided, however, that
no such extension of performance shall require New Power to provide the Services
to the Sellers beyond the Term.

         12.3 WAIVER. This Agreement may be amended, superseded, canceled,
renewed or extended only by a written instrument signed by the parties hereto.
The provisions hereof may only be waived in writing by the parties hereto. No
delay on the part of any party in exercising any right, power or privilege
hereunder shall operate as a waiver thereof, nor shall any waiver on the part of
any party of any such right, power or privilege, nor any single or partial
exercise of any such right, power or privilege, preclude any further exercise
thereof or the exercise of any other such right, power or privilege. Except as
otherwise provided herein, the rights and remedies herein provided are
cumulative and are not exclusive of any rights or remedies that any party may
otherwise have at law or in equity.

         12.4 SEVERABILITY. If any term, provision, covenant or restriction of
this Agreement is held by a court of competent jurisdiction to be invalid, void
or unenforceable, the remainder of the terms, provisions, covenants and
restrictions of this Agreement shall continue in full force and effect and shall
in no way be affected, impaired or invalidated so long as the economic or legal
substance of the transactions contemplated hereby is not affected in any manner
materially adverse to any party. Upon such determination that any term,
provision, covenant or restriction is invalid, void or unenforceable, the
parties hereto shall negotiate in good faith to modify this Agreement so as to
effect the original intent of the parties as closely as possible in an
acceptable manner to the end that the transactions contemplated hereby are
fulfilled to the fullest extent possible.

         12.5 HEADINGS. Section headings are for reference purposes only and
shall not control or alter the meaning of this Agreement as set forth in the
text.

         12.6 RELATIONSHIP OF PARTIES. In the performance of the Services
hereunder, New Power will at all times be an independent contractor, and nothing
in this Agreement shall constitute, nor be deemed to constitute, a joint
venture, partnership, agency, or employer/employee relationship between the
parties. The Sellers expressly acknowledge that New Power is not acting as a
fiduciary for the Sellers in respect of its performance under this Agreement or
in the activities or obligations contemplated hereunder.

         12.7 NO THIRD PARTY BENEFICIARIES. The Agreement has been entered into
for the sole benefit of the Sellers and New Power, and in no event shall any
third party beneficiaries be created thereby.

                            (SIGNATURE PAGE FOLLOWS)

                                    * * * * *

<PAGE>

         IN WITNESS WHEREOF, the parties hereto have executed this Services
Agreement as of the day and year indicated above.

THE NEW POWER COMPANY                   COLUMBIA ENERGY SERVICES
                                           CORPORATION

By: /s/ KATHLEEN E. MAGRUDER            By: /s/ DENNIS A. PICK
   ---------------------------------       -------------------------------------

Name: Kathleen E. Magruder              Name: Dennis A. Pick
     -------------------------------         -----------------------------------

Title: Vice President, Govt Affairs     Title: SVP
      ------------------------------          ----------------------------------

                                        COLUMBIA ENERGY RETAIL
                                           CORPORATION

                                        By: /s/ DENNIS A. PICK
                                           -------------------------------------

                                        Name: Dennis A. Pick
                                             -----------------------------------

                                        Title: SVP
                                              ----------------------------------

                                        COLUMBIA ENERGY POWER
                                           MARKETING CORPORATION

                                        By: /s/ DENNIS A. PICK
                                           -------------------------------------

                                        Name: Dennis A. Pick
                                             -----------------------------------

                                        Title: SVP
                                              ----------------------------------

<PAGE>

                                    EXHIBIT A

                                 Representatives

The Initial Sellers Representative:
                                         Name:  Dennis A. Pick
                                         Title: CFO
                                         Phone: (703) 561-6465
                                         Pager: (703) 919-2542

Initial New Power Representative:
                                         Name:  Timothy L. Ray
                                         Title: Director, Risk Management
                                         Phone: (713) 853-9475
                                         Pager: (888) 620-2348

<PAGE>

                                   SCHEDULE I

                             DESCRIPTION OF SERVICES

I.       PERSONNEL SUPERVISION SERVICES

         SERVICES:         New Power will provide day-to-day instruction to the
                           Sellers' employees and will supervise the contractors
                           listed on APPENDIX A attached hereto with respect to
                           the operational functions listed on APPENDIX A.

                           SELLERS RESPONSIBILITIES - To the extent such
                           employees are still under employment with Sellers,
                           Sellers shall make available the employees listed on
                           Appendix A in accordance with Section 7.10(A) of the
                           Purchase Agreement while maintaining ultimate control
                           and supervision of such employees. Except for cause,
                           Sellers shall not terminate such employees any
                           earlier than thirty (30) days after the Closing.

II.      REGULATORY CONSULTING SERVICES

         SERVICES:         New Power will prepare the following reports to the
                           extent such reports are applicable to the Second
                           Closing Assets:

                           1.       Georgia Public Service Commission (GPSC)

                                    New Power will prepare the monthly report to
                                    be filed with the GPSC on or before the 20th
                                    day of each month, providing the following
                                    data for the proceeding month: composite
                                    sales volume and average revenue data by
                                    type of customer and delivery group; number
                                    of residential customers; number of
                                    commercial customers; total number of
                                    customers; therms delivered to commercial
                                    customers; total therms delivered in firm
                                    service to customers; total therms purchased
                                    from suppliers for firm customer demands.

                                    New Power will prepare the monthly report to
                                    be filed with the GPSC by the 5th of the
                                    current month, providing the Sellers'
                                    standard fixed offer and standard variable
                                    offer for residential customers, which will
                                    include the cost per therm for the commodity
                                    and upstream capacity charges, and AGL's
                                    base charge, Sellers' customer service
                                    charge, and any other charges to be included
                                    in the offers.

                                    New Power will be responsible for notifying
                                    customers each quarter of Sellers' complaint
                                    procedures.

                                      -1-
<PAGE>

                           2.       Pennsylvania Public Utility Commission
                                    (PPUC)

                                    New Power will prepare the level of gross
                                    receipts quarterly report to be filed with
                                    the PPUC within 30 days following the end of
                                    the quarter, and will prepare any other
                                    periodic reporting requirements as may be
                                    issued by the PPUC.

                                    New Power will maintain the data to be
                                    submitted in the annual report due on or
                                    before April 30 each year

                           3.       New Jersey Board of Public Utilities

                                    New Power will maintain the summary records
                                    related to energy contracts or transactions
                                    entered into with New Jersey customers or
                                    services provided by Sellers to New Jersey
                                    customers. New Power will maintain a record
                                    of customer complaints and resolution
                                    thereof.

                           4.       New Power will prepare any similar reports
                                    requiring assimilation and accumulation of
                                    customer and/or commodity data that may
                                    become the subject of filing requirements
                                    pursuant to regulatory determination in any
                                    Jurisdiction in which Sellers retain
                                    customers and/or pursuant to any federal
                                    authority such as FERC.

                           SELLERS' RESPONSIBILITIES - Sellers will be
                           responsible for filing the foregoing reports with the
                           appropriate authorities and will make all such
                           filings on their own letterhead.

III.     RISK MANAGEMENT CONSULTING SERVICES

         SERVICES:

         A.       PRICING OF RETENTION CUSTOMERS: New Power will maintain the
                  existing Sellers models, or utilize new models at New Power's
                  sole discretion, in order to provide forward price
                  determination for customer retention. The pricing will include
                  the determination of margin adders pursuant to market
                  conditions and competitor pricing.

                  SELLERS' RESPONSIBILITIES - The Sellers will make available
                  all existing pricing models that they utilize in the
                  performance of customer retention pricing. In addition, to the
                  extent the Sellers' personnel are or become aware of or have
                  access to such information, the Sellers will provide input
                  related to any regulatory, tariff or competitive market
                  related information that may have a material impact on forward
                  market pricing. This information will be provided as it
                  becomes available.

         B.       SUPPLY, CAPACITY AND STORAGE TRANSACTION EXECUTION: - New
                  Power will complete, on behalf of the Sellers, all forward
                  term physical supply, transportation capacity and

<PAGE>

                  storage transactions that it deems necessary, in light of
                  market conditions and customer demand requirements, in order
                  to provide the required level of delivery service reliability,
                  manage the existing open position risk and operate within
                  utility tariff guidelines. New Power will take title in its
                  name for all completed transactions upstream of and at the
                  citygate, and New Power will make wholesale resales to the
                  Sellers at the applicable LDC citygate at no additional cost
                  to the Sellers above the Reimbursement Amount. The parties
                  acknowledge and agree that Sellers will have fully satisfied
                  any reimbursement requirements with respect to New Power for
                  all costs incurred by New Power in connection with this
                  Section III(B) upon payment of the Reimbursement Amount.

                  SELLERS' RESPONSIBILITIES -To the extent the Sellers'
                  personnel have or gain such knowledge, the Sellers will
                  provide pipeline/utility systems and competitive market
                  knowledge, as requested by New Power, to incorporate into the
                  decision making process. THE SELLERS WILL PROVIDE, TO THE
                  EXTENT EXISTING AS OF THE EFFECTIVE DATE, SOFTWARE ACCESS TO
                  SYSTEM EBB'S IN ORDER TO EXECUTE TRANSACTIONS.

         C.       SUPPLY PLANNING, SPOT TRANSACTIONS, DAILY SCHEDULING AND
                  SETTLEMENT SERVICES: New Power will complete all daily spot
                  purchases and sales necessary in order to meet the balancing
                  requirements of the applicable utility systems. New Power will
                  take title in its name for all completed transactions upstream
                  of and at the citygate, and New Power will make wholesale
                  resales to the Company at the applicable LDC citygate at no
                  additional cost to the Sellers above the Reimbursement Amount.
                  The parties acknowledge and agree that Sellers will have fully
                  satisfied any reimbursement requirements with respect to New
                  Power for all costs incurred by New Power in connection with
                  this Section III(C) upon payment of the Reimbursement Amount.
                  Pursuant to the daily transaction execution, New Power will
                  complete all utility scheduling requirements inclusive of
                  storage and imbalance. New Power will coordinate pipeline
                  contract confirmation with upstream suppliers. New Power will
                  provide all GMS data entry and maintenance in support the
                  daily scheduling. In conjunction with daily scheduling
                  activity, New Power will complete all imbalance trading,
                  cash-outs and other imbalance settlements. Pursuant to the
                  above service, New Power will make monthly and daily
                  determinations on the amount and timing of supply purchases
                  and applicable wholesale sales, as necessary, in order to
                  maintain the lowest economic supply cost.

         D.       ENERGY ACCOUNTING - INVOICE PROCESSING, PAYMENTS, CONTRACT
                  CONFIRMATIONS AND ACTUALIZATIONS: New Power will complete the
                  processing and verification of all third party supply and
                  utility based invoicing. Utility based invoicing will include
                  all interstate pipeline and LDC invoices rendered for
                  commodity services. New Power will confirm the accuracy of all
                  invoices against third party imbalance and/or allocation
                  statements and generate payments to the vendor within the
                  prescribed time limits of the underlying contract(s) or
                  utility tariff(s). Where applicable, New Power will process
                  invoices to third parties for wholesale sales conducted in the
                  open market to comply with balancing requirements. Pursuant to
                  settlement payments and invoicing, New Power will verify,
                  process and execute all transactional

<PAGE>

                  confirmations received from third parties. Where applicable,
                  New Power will generate and send transactional confirmations
                  subject to contract requirements.

IV.      CUSTOMER SERVICES

         SERVICES:         New Power shall provide (a) customer service
                           functions to the extent that they are legally
                           required or contractually required and are currently
                           being provided by Sellers and to the extent that new
                           customer service functions may become required
                           pursuant to regulatory directive and (b) to the
                           extent such services are provided by contractors
                           listed on APPENDIX A, supervise such contractors with
                           respect to customer service functions, except to the
                           extent that the failure of the Sellers to provide the
                           information described below prohibits New Power from
                           providing the Services described in clauses (a) and
                           (b) above. Customer service functions include, but
                           are not limited to, customer awareness and education,
                           customer enrollment, customer literature services,
                           general customer care services, customer data and
                           record maintenance, customer complaint resolution,
                           and customer cancellation and movement services.

                           SELLERS' RESPONSIBILITIES - Seller will provide New
                           Power with all relevant customer service-related
                           information furnished or made available to the
                           Sellers by LDCs, utilities and contractors or through
                           the Sellers' own activities.

V.       REVENUE MANAGEMENT SERVICES

         SERVICES:

         A.       CUSTOMER BILLING: - New Power will provide billing services
                  for Sellers customers as required within the applicable
                  utility and LDC territories as applicable, except to the
                  extent that the failure of the Sellers to provide the
                  information described below prohibits New Power from providing
                  the Services described herein. Billing models utilized will be
                  consistent with those previously utilized by the Sellers in
                  each specific territory (i.e., UDC/LDC consolidated, ESP
                  consolidated, dual billing etc.) This service will include:

                           1.       Usage Management - New Power will collect
                                    customer usage data from applicable utility
                                    territories via EDI transaction processes
                                    currently in place within the Sellers
                                    operation.

                           2.       Billing Calculation - Billing calculations
                                    to derive applicable customer charges will
                                    be performed by New Power consistent with
                                    those processes previously in use within
                                    Sellers operations. Bills will contain
                                    utility charges (distribution and
                                    transportation) and energy consumption
                                    charges plus appropriate taxes.

<PAGE>

                           3.       Bill Printing & Distribution - New Power
                                    will provide services to manage the bill
                                    print and distribution process including the
                                    management of the bill print vendor
                                    currently under contract (SFI Incorporated).

                           SELLERS RESPONSIBILITIES -Sellers will provide New
                           Power with all relevant customer billing-related
                           information furnished or made available to the
                           Sellers by LDCs, utilities and contractors or through
                           the Sellers' own activities.

         B.       Customer Remittance and Collections - New Power will manage
                  the customer remittance and collection processes, except to
                  the extent that the failure of the Sellers to provide the
                  information described below prohibits New Power from providing
                  the Services described herein. This will include, but not be
                  limited to, management of the lock box and automatic bank
                  draft (ACH) processes, manual payment processing, exception
                  processing, as appropriate to customer accounts and coordinate
                  with the customer care channel to accomplish collection
                  activities as necessary and consistent with New Power credit
                  and collection policies.

                           SELLERS RESPONSIBILITIES -Sellers will provide New
                           Power with all relevant customer remittance and
                           collection-related information furnished or made
                           available to the Sellers by LDCs, utilities and
                           contractors or through the Sellers' own activities.

VI.      MISCELLANEOUS REPORTS

Unless otherwise provided for elsewhere in the Agreement, New Power agrees to
deliver specific reports reasonably required by Sellers, subject to the mutual
agreement of the parties regarding the costs to the Sellers for the development
and delivery of such reports. To the extent any report relates to the period
following the Closing, New Power shall bear the cost thereof; otherwise, the
cost of all reports shall be borne by the Sellers.

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