Exhibit 10.3.42


                AMENDMENT NO. 1 TO AGREEMENT ADDRESSING RENEWABLE
                -------------------------------------------------

                        ENERGY PRICING AND PAYMENT ISSUES
                        ---------------------------------

                                     between

                            HEBER GEOTHERMAL COMPANY

                                  QFID No.3001

                                       and

                       SOUTHERN CALIFORNIA EDISON COMPANY

1.   PARTIES.

     The Parties to this Amendment No. 1 ("Amendment") to the Agreement
     Addressing Renewable Energy Pricing and Payment Issues ("Agreement") are
     Heber Geothermal Company ("SELLER"), a California partnership, and Southern
     California Edison Company ("EDISON"), a California corporation. EDISON and
     SELLER are hereinafter sometimes referred to individually as a "Party" and
     jointly as the "Parties."

2.   RECITALS.

     This Amendment to the Agreement is entered into between the Parties with
     reference to the following facts:

2.1  On August 26, 1983, SELLER'S predecessor and EDISON executed a power
     purchase agreement (the "Contract"), which establishes, among other things,
     the terms and conditions pursuant to which EDISON purchases electric power
     from SELLER and SELLER sells electric power to EDISON.

2.2  On or about August 26, 1983, EDISON consented to an assignment of the
     Contract from SELLER'S predecessor to SELLER and such assignment was made.

2.3  On or about June 19, 2001, EDISON and SELLER entered into the Agreement.

2.4  On or about October 2, 2001, EDISON and the California Public Utilities
     Commission ("Commission") entered into a settlement agreement (the "Rate
     Doctrine Settlement Agreement") pursuant to which EDISON and the Commission
     agreed to settle certain litigation pending in the United States District
     Court for the Central District of California, entitled "Southern California
     Edison Company v. Loretta M. Lynch et al.," USDC Case No. 00-12056-RSWL
     (Mcx) (the "Federal Litigation").

2.5  On or about October 5, 2001, the Court in the Federal Litigation approved
     the Rate Doctrine Settlement Agreement and entered judgment for EDISON
     against the Commission (the "Judgement") in accordance with the terms of
     the Rate Doctrine Settlement Agreement.



2.6  The Parties desire to amend the Agreement in order to account for the
     foregoing developments and circumstances.

3.   AGREEMENT

     In consideration of promises, mutual covenants and agreements hereinafter
     set forth, and for other good and valuable consideration, as set forth
     herein, the Parties agree to amend the Agreement as follows:

3.1  In Section 3.2.1 of the Agreement, replace "Section 3.2.5" with "Section
     3.2.4."

3.2  Section 3.2.3 of the Agreement is hereby replaced, in its entirety, with
     the following revised Section 3.2.3:

     "3.2.3 PARTIAL PAYMENTS OF THE STIPULATED AMOUNT.

     "3.2.3.1 On the Initial Interest Payment Date, EDISON shall also pay to
     SELLER ten percent (10%) of the Stipulated Amount (the "Initial Partial
     Payment").

     "3.2.3.2 Except as provided in Section 3.2.3.3, EDISON shall not be
     required to make any partial payments of the Stipulated Amount other than
     the Initial Partial Payment; provided, however, that nothing herein shall
     preclude EDISON from, at any time, electing to make partial payments of the
     Stipulated Amount that are in addition to those required under Section
     3.2.3.1, and those, if any, made pursuant to Section 3.2.3.3.

     "3.2.3.3 During the Partial Payment Period, as defined below, EDISON shall
     make a further partial payment or payments, as applicable, of the
     Stipulated Amount to SELLER if (i) Commission Approval, as defined in
     Section 4.1.1 of Amendment No. 1 to this Agreement (hereinafter, the
     "Amendment") has been either obtained or waived by EDISON, and (ii) EDISON
     makes a payment of Specified Indebtedness (as defined in Schedule I to the
     Amendment) that, together with all other payments, if any, of Specified
     Indebtedness during the Partial Payment Period, exceeds $100 million (the
     "Partial Payment Threshold"). EDISON shall make any partial payment of the
     Stipulated Amount required to be made to SELLER under this Section 3.2.3.3
     within five (5) business days after the later of (a) if Commission Approval
     of the Amendment has already been obtained or waived, the date on which any
     payment of Specified Indebtedness is made that causes the Partial Payment
     Threshold to be exceeded or (b) if a payment of Specified Indebtedness that
     has caused the Partial Payment Threshold to be exceeded has previously
     occurred, the date on which Commission Approval of the Amendment has been
     obtained or waived by EDISON. The amount of any payment required to be made
     to SELLER as specified above in this Section 3.2.3.3 shall be calculated by
     (x) dividing the aggregate amount of the payments of Specified Indebtedness
     made by EDISON from the commencement of the Partial Payment Period through
     the date on which such aggregate payments of Specified Indebtedness have
     caused the Partial Payment Threshold to be exceeded by the total amount of
     the Specified Indebtedness shown on Schedule I to Amendment No.1 to this
     Agreement, and (y) multiplying the Stipulated Amount applicable to SELLER
     by the ratio derived by the calculation in (x) above.


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     Thereafter, should EDISON continue to make a payments of Specified
     Indebtedness through the balance of the Partial Payment Period, EDISON
     shall be required to make corresponding, additional partial payments of the
     Stipulated Amount to SELLER as provided for this Section 3.2.3.3 except
     that in calculating the required amount of such additional partial
     payments, if any, and in determining the due date for payment of such
     additional partial payments, EDISON shall not be required to take into
     account any prior payments of Specified Indebtedness that were previously
     taken into account in calculating any previous partial payment to SELLER
     under this Section 3.2.3.3. Accordingly, for the purpose of determining the
     amount of any additional partial payment determined to be due SELLER under
     this Section 3.2.3.3, the ratio defined in (x) above shall be calculated by
     dividing the aggregate payments of Specified Indebtedness that were made
     subsequent to the payments that were used in calculating all previous
     partial payments to SELLER under this Section 3.2.3.3 and which have again
     caused the Partial Payment Threshold to be exceeded by the total amount of
     Specified Indebtedness shown on Schedule I. The "Partial Payment Period" is
     the period commencing on December 1, 2001 and ending on the earlier of (A)
     the Final Payment Date, as defined in Section 3.2.4 of this Agreement, or
     (B) September 30, 2002. In no event shall the payments made to SELLER
     pursuant to this Section 3.2.3.3 and Section 3.2.4 of this Agreement, taken
     together, exceed 100% of the Stipulated Amount.

     "3.2.3.4 After the date hereof, EDISON shall not make any partial payments
     to one "class of qualifying facility," as defined below, without making an
     equivalent (by percentage of the Stipulated Amount) partial payment to each
     member of the other "class of qualifying facility" that is a party to an
     agreement and amendment with EDISON that is similar to the Agreement and
     the Amendment. For the purpose of implementing this Section 3.2.3.4, the
     following shall constitute a "class of qualifying facility": (i) the class
     of qualifying facilities under contract with EDISON that use natural gas as
     their primary fuel source; (ii) the class of qualifying facilities under
     contract with EDISON that do not use natural gas as their primary fuel
     source."

3.3  Section 3.2.4 of the Agreement is hereby replaced in its entirety, with the
     following revised Section 3.2.4:

     "3.2.4 FINAL PAYMENT.

     "The Final Payment Amount, as defined below, shall become due and payable
     by EDISON to SELLER on the Final Payment Date; provided, however, that
     EDISON shall be permitted a grace period of five (5) business days
     following the Final Payment Date to calculate the Final Payment Amount,
     process the Final Payment, and wire-transfer the Final Payment to SELLER.
     The "Final Payment Amount" is the amount, calculated on the Final Payment
     Date, as defined herein, that is equal to (i) the Stipulated Amount; (ii)
     plus all accrued but unpaid Interest (if any) pursuant to Section 3.2.2
     calculated through and including the date on which the Final Payment Amount
     is actually wire-transferred to SELLER; (iii) less all partial payments of
     the Stipulated Amount made by EDISON to SELLER pursuant to Section 3.2.3.1,
     Section 3.2.3.3 or otherwise. The "Final Payment


                                       3



     Date" means the earliest of (a) the date on which EDISON makes one or more
     payments of the Specified Indebtedness during the Partial Payment Period,
     as defined in Section 3.2.3.3, which together with all previous payments of
     Specified Indebtedness during the Partial Payment Period, causes the total
     amount of Specified Indebtedness paid during the Partial Payment Period to
     equal or exceed $3 billion; (b) the date on which EDISON makes payments
     and/or restructures the obligations (other than the $1.65 billion of bank
     indebtedness) constituting the Specified Indebtedness such that Edison is
     no longer in arrears or in a condition of default with respect to 80% or
     more of the obligations (other than the $1.65 billion of bank indebtedness)
     constituting the Specified Indebtedness; or (c) the date on which EDISON
     first obtains funds in an aggregate amount of $600 million or greater from
     any financing after the commencement of the Partial Payment Period, as
     defined in Section 3.2.3.3. Notwithstanding the foregoing, nothing in this
     Section 3.2.4 shall be construed to require EDISON to make the Final
     Payment before Commission Approval, as defined in Section 4.1.1 of the
     Amendment, has been either obtained or waived by EDISON."

3.4  Section 3.2.5 of the Agreement is hereby deleted in its entirety.

3.5  The definition of "Standstill Period" contained in Section 3.3.1 of the
     Agreement is hereby deleted in its entirety, and replaced with the
     following revised definition:

     "3.3.1 STANDSTILL.

     ""Standstill Period," as used herein, means the period commencing with the
     date on which both the Initial Interest Payment and Initial Partial Payment
     have been made and ending on the earliest of the following dates: (i)
     default by EDISON under any of the payment provisions contemplated by this
     Agreement (as amended by the Amendment) or the Contract with respect to
     payments for energy and capacity delivered after March 26, 2001 under the
     Contract; (ii) the fifth business day after Final Payment Date if EDISON
     pays the Final Payment Amount; (iii) the date on which EDISON files a
     petition for protection under the bankruptcy laws or an involuntary
     petition for relief in bankruptcy is filed against EDISON and an order for
     relief is entered with respect to such petition; (iv) September 30, 2002 at
     11:59 p.m. Notwithstanding the foregoing, nothing in this Section 3.3.1
     shall prohibit EDISON from pursuing or participating in judicial and/or
     regulatory proceedings pertaining to any other qualifying facility that has
     not executed this form of Agreement or another form of agreement providing
     for forbearance of claims against EDISON."

3.6  Section 3.4.1 of the Agreement is hereby replaced, in its entirety, with
     the following revised Section 3.4.1:

     "3.4.1 INTERIM ENERGY PRICE.

     "Unless otherwise established in the Contract, for the period (herein, the
     "Interim Period") commencing with the date on which this Agreement has been
     executed by the Parties and ending on the last minute of April 30, 2002,
     the SRAC upon which SELLER's energy payment is calculated shall be
     determined in accordance


                                       4



     with the SRAC formula approved by the Commission in D.96-12-028, as
     modified by D.01-03-067 (hereafter referred to as the "Monthly SRAC"),
     which formula, for purposes of this Agreement, shall not be subject to
     further change by the Commission, by any other regulatory authority, or by
     any court with jurisdiction in the matter; provided, however, that, in lieu
     of payments calculated pursuant to the SRAC formula described in the
     preceding sentence, SELLER may, for energy deliveries commencing on the
     first day of the next calendar month following the date that Amendment No.
     1 to this Agreement has been executed by the Parties, but no earlier than
     December 1, 2001, and for the balance of the Interim Period, elect to
     receive an alternative fixed price of $0.0325 per kWh (the "Alternative
     Interim Energy Price") for energy delivered by SELLER to EDISON. The
     Alternative Interim Energy Price shall be weight-adjusted by the
     Time-of-Delivery ("TOD") factors set forth in EDISON'S Time-of-Use rate
     schedule "TOU-8." SELLER hereby elects to be paid according to the
     following method during the balance of the Interim Period in accordance
     with this section 3.4.1:

     [_]  Alternative Interim Energy Price

     [X]  Monthly SRAC

     (check one of the above).

     "If SELLER elects to receive the Alternative Interim Energy Price, and
     Amendment No. 1 to this Agreement is terminated pursuant to Section 4.13 of
     such Amendment as a result of Commission Approval not having been timely
     obtained or waived, then SELLER shall not be paid for energy deliveries at
     the Alternative Interim Energy Price established above and shall instead be
     paid for energy deliveries during the Interim Period in accordance with the
     Monthly SRAC. If such termination occurs, the net difference in payments
     made by EDISON to SELLER calculated, on a monthly basis, by subtracting the
     payments that were made by EDISON for the month in question based on the
     Alternative Interim Energy Price from the payments that SELLER would have
     received during the same month if such payments had been based on Monthly
     SRAC, plus interest (calculated in the manner described below in this
     section), shall, if such net monthly net difference is positive, be added
     to the first payment due SELLER following termination of Amendment No. 1 to
     this Agreement, and if such monthly net difference is negative, deducted
     from such payment (and from any subsequent payments as may be necessary to
     fully recoup any excess payments made at the Alternative Interim Energy
     Price rate). Interest on the net difference shall be calculated at the
     Federal Reserve Board three-month prime commercial paper rate as to each
     monthly payment made based on the Alternative Interim Energy Price
     commencing on the day on which such payment was mailed and ending on the
     date on which any statement reflecting the adjustment described in the
     preceding sentence is mailed."

3.7  Sections 3.4.2 and 3.4.3 of the Agreement are hereby replaced, in their
     entirety, with the following revised Sections 3.4.2 and 3.4.3:


                                       5



     "3.4.2 FIXED ENERGY PRICE.

     "Notwithstanding any provision of the Contract to the Contrary, commencing
     on the first minute of May 1, 2002, and for a period of five (5) years
     thereafter (such five-year period being referred to herein as the "Fixed
     Rate Period"), SELLER hereby elects that the SRAC for energy delivered to
     EDISON by SELLER, if SELLER's Contract provides for payment for energy
     based on SRAC, shall be a "fixed" price of 5.37 cents/kWh (the "Fixed
     Rate"), in lieu of the Commission-Approved SRAC Methodology; provided,
     however, that if the Contract terminates in accordance with its own terms,
     or for any other lawful reason, prior to the end of the Fixed Rate Period,
     then the Fixed Rate Period shall likewise terminate; and provided further,
     however, that if the Contract concerns a solar thermal facility that
     augments its energy input with fossil fuel, and such SELLER's Contract
     provides for payment for energy based on SRAC, EDISON shall pay for 75% of
     the energy delivered to EDISON by such SELLER during the Fixed Rate Period
     at the Fixed Rate and 25% of the energy delivered to EDISON by such SELLER
     at the rate described in Exhibit 3.4.2 to this Agreement. During the Fixed
     Rate Period, the Fixed Rate shall be weight-adjusted by Time-of-Delivery
     ("TOD") factors set forth in EDISON's Time-of-Use rate schedule "TOU-8." In
     the event that SELLER's Contract is still in the forecast energy payment
     period as of the Effective Date of this Agreement and provided that such
     forecast energy payment period expires no later than March 1, 2002, the
     rate for energy delivered by SELLER to EDISON shall be (i) the applicable
     forecast rate provided in the Contract through the conclusion of the
     forecast energy payment period; (ii) from the conclusion of the forecast
     energy payment period through the last minute of April 30, 2002, Monthly
     SRAC, or, if elected by SELLER at the time it executes this Amendment, the
     Alternative Interim Energy Price; and (iii) during the Fixed Rate Period,
     the Fixed Rate. Any SELLER not paid the Fixed Rate in the place of SRAC
     under one of the circumstances described in this Section 3.4.2 shall be
     paid for its energy deliveries in accordance with the then-current
     Commission-approved SRAC and, if SELLER's Contract provides for a rate
     other than the Commission-approved SRAC, then at such other rate as
     specified in SELLER's Contract.

     "3.4.3 On the first day after the last day of the Fixed Rate Period, the
     SRAC price payable to SELLER if it has received the Fixed Rate as provided
     above shall, for the remaining term of the Contract; be established in
     accordance with the Commission-approved SRAC methodology then in effect and
     as may thereafter be updated by the Commission from time to time,
     including, but not limited to, the TOD factors and energy loss adjustment
     factor."

3.8  Section 3.5 of the Agreement is hereby replaced, in its entirety, with the
     following revised Section 3.5:

     "3.5 ENERGY LOSS ADJUSTMENT FACTORS.

          "Unless otherwise specifically provided in the Contract, during the
     Fixed Rate Period, the energy loss adjustment factor ("ELAF") applicable to
     energy


                                        6



     deliveries to EDISON from SELLER will be 1.0. During the Interim Period,
     the ELAF applicable to energy deliveries from SELLER to EDISON for which
     EDISON pays SELLER Monthly SRAC shall be determined in accordance with the
     methodology approved by the Commission in D.01-01-007, and, for purposes
     of this Agreement, shall not be subject to further change by the
     Commission, by any other regulatory authority, or by any court with
     jurisdiction in the matter during the Interim Period; provided, however,
     that if SELLER elects to be paid the Alternative Interim Energy Price
     pursuant to Section 3.4.1, then the ELAF applicable to energy deliveries
     made by SELLER to EDISON and paid for at such Alternative Interim Energy
     Price shall be 1.0."

3.9  Section 3.6 of the Agreement is hereby replaced, in its entirety, with the
     following revised Section 3.6:

     "3.6 MUTUAL RELEASES; DISMISSAL OF LITIGATION.

     "Effective upon and subject to EDISON paying the Final Payment Amount to
     SELLER:

          "(a) The Parties release and discharge each other and their respective
     affiliates, parents, officers, directors, employees, agents, insurers,
     attorneys and assigns from any and all claims, debts, liens, causes of
     action or damages of any kind whatsoever existing at any time on or before
     the date on which this Agreement has been executed by the Parties (or, in
     the case of claims, debts, etc., arising from EDISON's suspension of
     payments for energy and capacity delivered by SELLER during the period
     November 1, 2000 through March 26, 2001, existing at any time on or before
     the Final Payment Date), whether in law or in equity, whether known or
     unknown, arising from or related to either Party's performance or
     non-performance under the Contract; provided, however, that, except with
     respect to claims arising from or related to EDISON's suspension of
     payments as referenced above, nothing herein shall be deemed to release or
     waive any claim arising from or related to either Party's performance or
     non-performance under the Contract from and after the day following the
     date on which this Agreement has been executed by the Parties regardless of
     whether such performance or non-performance, insofar as it also existed
     before the date on which this Agreement has been executed by the Parties,
     is released pursuant to this Section 3.6 for such prior period.
     Notwithstanding the foregoing, nothing contained in this Agreement shall
     release any person or entity other than SELLER itself from any claims,
     causes of action, or rights EDISON may now have, or may obtain in the
     future, for illegal or otherwise actionable conduct that resulted in
     increases in the prices EDISON paid or was required to pay for electricity,
     natural gas, or both.

          "(b) As to claims that are released pursuant to this Section 3.6,
     SELLER and EDISON waive the application of California Civil Code Section
     1542, which provides: "A general release does not extend to claims which
     the creditor does not know or suspect to exist in his favor at the time of
     executing the release, which if known by him must have materially affected
     the settlement with the debtor."


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          "(c) The Parties shall promptly cause to be dismissed with prejudice
     all claims in the Litigation [if applicable] that would be barred by the
     foregoing mutual release."

3.10 Section 4.13 of the Agreement is hereby replaced, in its entirety, with the
     following revised Section 4.13:

     "4.13 TERMINATION.

     "Except as provided herein, this Agreement shall terminate automatically on
     September 30, 2002 at 11:59 p.m. if the Final Payment Amount, as defined in
     Section 3.2.4, has not yet been paid to SELLER. Notwithstanding the
     foregoing, the second sentence of Section 3.2.1 and the entirety of
     Sections 3.3.2, 3.3.3, 3.4.1, 3.4.2, 3.4.3, 3.5, 4.11 and 4.13 shall
     survive any termination of this Agreement (assuming that all conditions
     precedent to the effectiveness of such Sections, including, but not limited
     to, Commission Approval, have been satisfied)."

4.   OTHER TERMS AND CONDITIONS.

4.1  COMMISSION APPROVAL.

     4.1.1 With the exception of Sections 3.5 and 4.1.2 of this Amendment, this
     Amendment, or in the alternative, the form amendment upon which this
     Amendment is based if EDISON submits that form instead to the Commission,
     is subject to Commission Approval as to reasonableness for purposes of rate
     recovery by EDISON, and shall not become effective until Commission
     Approval has been obtained or waived by EDISON, as provided herein.
     "Commission Approval," as used in this Amendment, shall mean that the
     Commission has issued a final decision, no longer subject to appeal,
     approving this Amendment or the standardized form, as appropriate, without
     condition or modification unacceptable to the Parties and containing
     findings and conclusions confirming the reasonableness of this Amendment
     (or the standardized form) comparable to those pertaining to the Agreement
     set forth in D.01-06-015 and D.01-07-031, including, but not limited to,
     findings that EDISON's entry into this Amendment (or any amendment based
     substantially on the standardized form) are reasonable and prudent for all
     purposes, including, but not limited to, recovery of all payments made
     pursuant hereto in rates, subject only to review with respect to the
     reasonableness of EDISON's future administration of the Contract, the
     Agreement, and this Amendment. EDISON shall file with the Commission the
     appropriate request for approval of this Amendment or the standardized
     form, as appropriate, and seek such approval expeditiously. SELLER shall
     use reasonable efforts in cooperation with EDISON for the purpose of
     obtaining Commission Approval.

     4.1.2 During the period commencing on the date that this Amendment has been
     executed by each of the Parties and ending on the earliest of (i) March 1,
     2002 if Commission Approval has not then been obtained or waived by EDISON,
     (ii) the date, if any, on which the Commission issues a decision that
     expressly denies


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     Commission Approval or (iii) the expiration of the Standstill Period, as
     defined in Section 3.5 above, the Parties, and each of them, shall refrain
     from asserting any claim or demand against the other or from commencing any
     litigation or other proceeding against the other, including, but not
     limited to claims for declaratory relief, specific performance, and breach
     of contract, (a) concerning or arising from the issue of whether the "MOU
     Effective Date," as defined in Section 3.2.3 of the Agreement, has occurred
     and/or (b) which would be rendered moot upon the amending of the Agreement
     in accordance with this Amendment if Commission Approval of this Amendment
     is either timely obtained or waived within the period established in
     Section 4.13 below.

4.2  WAIVER OF COMMISSION APPROVAL.

     In its sole discretion, EDISON may waive Commission Approval as to all or
     any individual aspect of this Amendment requiring Commission Approval at
     any time by giving notice of such waiver in writing to SELLER.

4.3. SEMI-MONTHLY PAYMENTS WAIVER.

     Notwithstanding any provisions to the contrary in the Agreement concerning
     the timing or method of payments for energy and capacity delivered by
     SELLER to EDISON, the first payment due SELLER for energy and capacity
     delivered to EDISON after it pays the Final Payment Amount shall be paid in
     accordance with the payment provisions of the Contract or the Agreement, as
     applicable, and SELLER hereby waives, commencing with such first payment,
     any right that it might have pursuant to D.01-03-067 to receive
     accelerated or semi-monthly payments in lieu of monthly payments pursuant
     to the Contract.

4.4  EFFECT ON CONTRACT AND THE AGREEMENT.

     Except as expressly provided herein, all provisions of the Agreement and
     the Contract, as modified by the Agreement, including but not limited to
     the capacity payment provisions, shall remain in effect and unchanged and
     shall not be affected by the terms and conditions of this Amendment.
     Nothing herein shall be read to extend the term of the Contract.

4.5  NO WAIVER.

     None of the provisions of this Amendment, including this paragraph, shall
     be considered waived by either Party unless such waiver is given in
     writing. The failure of either Party to insist in any one or more instances
     upon strict performance of any of the provisions of this Amendment or to
     take advantage of any of its rights hereunder shall not be construed as a
     waiver of any such provisions or the relinquishment of any such rights for
     the future, but the same shall continue and remain in full force and
     effect.

4.6  FURTHER AGREEMENTS.

     This Amendment shall not be amended, changed, modified, abrogated or
     superseded by a subsequent agreement unless such subsequent agreement is in
     the form of a written instrument signed by the Parties.


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4.7  ENTIRE AGREEMENT.

     This Amendment, taken together with those provisions of the Agreement that
     have not been amended by this Amendment, constitutes the entire agreement
     of the Parties as to the matters set forth herein and in the Agreement, and
     supersedes any and all prior negotiations, correspondence, undertakings,
     and agreements between the Parties concerning the subject matter of this
     Amendment and Agreement.

4.8  SUCCESSORS AND ASSIGNS: NO PRIOR ASSIGNMENTS.

     This Amendment shall be binding upon and inure to the benefit of the
     Parties hereto and their respective successors and assigns. SELLER hereby
     warrants and represents that prior to its entry into this Amendment, it has
     not assigned or otherwise transferred, directly or indirectly, voluntarily,
     involuntarily by or operation of law, any rights, claims or causes of
     action it may have against EDISON, or any damages, liabilities, losses and
     costs that would be released pursuant to the Agreement upon the
     satisfaction of the conditions stated therein.

4.9  CONSTRUCTION.

     This Amendment is the result of negotiation and each Party has participated
     in the preparation of this Amendment. Accordingly, any rules of
     construction to the effect that an ambiguity is to be resolved against the
     drafting Party shall not be employed in the interpretation of this
     Amendment. Furthermore, the underlined headings used in this Agreement are
     for reference purposes only and do not themselves constitute any of the
     terms of this Amendment.

4.10 GOVERNING LAW.

     This Amendment shall be interpreted, governed, and construed under the laws
     of the State of California as if executed and to be performed wholly within
     the State of California.

4.11 NO PRECEDENT: USE IN LITIGATION.

     Each Party agrees that this Amendment arises from unique facts and
     circumstances and, as such, without limiting the effect of this Section
     4.11, various provisions of this Amendment, such as, but not limited to,
     the Fixed Rate, the Alternative Interim Energy Price, Energy Loss
     Adjustment Factors, and the Stipulated Amount, shall not be used as
     evidence, or the basis for disputing the validity or appropriateness of
     such values, rates or prices, or for determination of avoided costs before
     FERC, the Commission, or any court or other judicial or quasi-judicial
     body, and nothing herein may be used as an admission against any Party.
     Further, nothing herein shall constitute or be deemed an admission by
     either Party with respect to whether the conditions set forth in the
     Agreement that would obligate EDISON to make the Second Partial Payment or
     to pay the Final Payment Amount, as each of those terms is defined in the
     Agreement, have been satisfied, it being expressly understood that this
     Amendment is the result of negotiation and compromise and further that, in
     the event that Commission


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     Approval of this Amendment has not been either obtained or waived within
     the period of time specified in Section 4.1.2 of this Amendment, the
     Parties shall be restored to their respective positions vis-a-vis the
     interpretation of and performance under the Agreement without regard to
     this Amendment. Except as provided in Section 4.1.1 of this Amendment,
     neither Party will introduce or otherwise use this Amendment or any of its
     terms or conditions in any judicial or administrative proceeding or to
     influence any governmental action, other than for the purpose of enforcing
     the terms and conditions of this Amendment.

4.12 AUTHORIZED SIGNATURES: NOTICES.

     Each Party represents and warrants that the person who signs below on
     behalf of that Party has received all requisite authorizations required to
     execute this Amendment on behalf of such Party and to bind such Party to
     this Amendment. All notices given under this Amendment shall be in writing
     and shall be effective on the same day if delivered by personal delivery or
     facsimile transmission, one day after sending if delivered by overnight
     delivery service, or five days after sending if delivered by first class
     U.S. mail. Notices shall be directed to the individual or individuals who
     are designated to receive notices under the Contract.

4.13 TERMINATION.

     Except as provided herein, this Amendment shall terminate automatically one
     hundred twenty (120) days from the date on which this Amendment has been
     executed by the Parties if Commission Approval, as defined in Section 4.1.1
     of this Amendment, has not been obtained or waived by EDISON; otherwise,
     this Amendment shall terminate concurrently with the termination of the
     Agreement. Termination of this Amendment as the result of failure to obtain
     Commission Approval, as provided above, shall not itself cause the
     termination of the Agreement, which shall instead continue in accordance
     with its own terms as though this Amendment had not been entered into.
     Notwithstanding the foregoing, the provisions of this Amendment that are
     not subject to Commission Approval, the provisions in Section 3.6 providing
     for a payment adjustment in the event the Alternative Interim Energy Price
     is not approved by the Commission, and the entirety of Sections 4.11 and
     4.13 shall survive any termination of this Amendment.


                                       11



4.14 EFFECTIVE DATE; COUNTERPARTS.

     This Amendment shall be effective on the date has been executed by the duly
     authorized representatives of the Parties. This Amendment may be executed
     in one or more counterparts, each of which shall be deemed an original
     document and which together shall constitute a single instrument.

HEBER GEOTHERMAL COMPANY,
a California partnership

By: ERC Energy, Inc.                     ERC Energy II
a Delaware corporation,                  a Delaware corporation,
a General Partner                        a General Partner


By: /s/ Richard E. Dyer                  By: /s/ Richard E. Dyer
    ----------------------------------       -----------------------------------
Name: Richard E. Dyer, Jr.               Name: Richard E. Dyer, Jr.
Title: Vice President                    Title: Vice President
Date: November 30, 2001                  Date: November 30, 2001


SOUTHERN CALIFORNIA EDISON COMPANY,
a California corporation


By: /s/ Stephen E. Frank
    ----------------------------------
Stephen E. Frank
Chairman, President and Chief Executive Officer

Date: 11.30.01


                                       12



                                   SCHEDULE I

                             SPECIFIED INDEBTEDNESS

For purposes of Section 3.2.3.3 of this Agreement, as modified by Amendment No.
1 to this Agreement, the term "Specified Indebtedness" shall mean the
outstanding principal of the following obligations of EDISON:

--------------------------------------------------------------------------------
OBLIGATION                                            PRINCIPAL AMOUNT (APPROX.)
--------------------------------------------------------------------------------
Bank Credit Facilities                                            $1,650,000,000
--------------------------------------------------------------------------------
Overdue PX/ISO Obligations                                           940,000,000
--------------------------------------------------------------------------------
Defaulted Commercial Paper                                           531,000,000
--------------------------------------------------------------------------------
Defaulted Senior Unsecured Notes                                     400,000,000
--------------------------------------------------------------------------------
Overdue ESP Payments                                                 231,000,000
--------------------------------------------------------------------------------
Defaulted Preferred Stock Dividends                                   17,000,000
--------------------------------------------------------------------------------
                                                           Total: $3,769,000,000
--------------------------------------------------------------------------------

Specified Indebtedness does not include imbalance energy payments to the
California Department of Water Resources.

The principal amounts shown above are stated solely for the purpose of
determining if partial payments of the Stipulated Amount are to be made under
this Agreement and do not constitute an admission that any amounts are legally
owed to any party by Southern California Edison Company or its affiliates.