CP&L Electric Service Agreements

Ozzie, Steve Van Hooser forwarded two agreement for electric service from
CP&L for the Elizabethtown and the Lumbertown cogen facilities for my
review. I have reviewed the documents and they are standard tariff type
service agreements. There are two items to which I would like to draw your
attention. These deals look to have a 10 year term since they are being
served from Transmission Service.

1. If Customer terminate earlier, there would be a termination payment equal
to the loss in salvage value of the facilities used to serve the Customer.
Not sure what this value is, but might be significant, depending on what
facilities CP&L would install to serve these plants.

2. There is a minimum bill each month that Customer would have to pay, even
if there was no usage of power by Customer.

If you are OK with these issues, I will initial the agreements and forward
these to you for signature.

Please contact me at x33512 if you would like to discuss.