File No. 70-8453


               SECURITIES AND EXCHANGE COMMISSION
                     450 Fifth Street, N.W.
                      Washington, DC 20549

                         AMENDMENT NO. 2

                               TO

                            FORM U-1

                     APPLICATION/DECLARATION

                              UNDER

         THE PUBLIC UTILITY HOLDING COMPANY ACT OF 1935

                                

                   NEW ENGLAND ELECTRIC SYSTEM
                        25 Research Drive
                Westborough, Massachusetts 01582

           (Name of Company filing this statement and 
             address of Principal Executive Office)

                   NEW ENGLAND ELECTRIC SYSTEM

  (Name of top registered holding company parent of applicant)



Michael E. Jesanis                     Robert King Wulff
Treasurer                              Corporation Counsel
25 Research Drive                      25 Research Drive
Westborough, MA 01582                  Westborough, MA 01582

            (Names and address of agents for service)

     Form U-1 Application/Declaration under the Public Utility
Holding Company Act of 1935, File No. 70-8453, is hereby amended
as follows:

     1. The fifth paragraph of Item 1 is amended to read as
follows:

     NEES does not have an ownership interest in an exempt
wholesale generator (EWG) or foreign utility company (FUCO) as
defined in Sections 32 and 33 of the Act.  Additionally, NEES is
not a party to, nor has any rights under, a service, sales, or
construction agreement with an EWG or a FUCO.

                            SIGNATURE


     Pursuant to the requirements of the Public Utility Holding
Company Act of 1935, the undersigned company has duly caused this
statement (Commission's File No. 70-8453) to be signed on its
behalf, as indicated, by the undersigned officer thereunto duly
authorized.

                              NEW ENGLAND ELECTRIC SYSTEM


                              s/Frederic E. Greenman
                          By: _____________________________
                              Frederic E. Greenman
                              Senior Vice President




Date:  October 31, 1994






The name "New England Electric System" means the trustee or
trustees for the time being (as trustee or trustees but not
personally) under an agreement and declaration of trust dated
January 2, 1926, as amended, which is hereby referred to, and a
copy of which as amended has been filed with the Secretary of the
Commonwealth of Massachusetts.  Any agreement, obligation or
liability made, entered into or incurred by or on behalf of New
England Electric System binds only its trust estate, and no
shareholder, director, trustee, officer or agent thereof assumes
or shall be held to any liability therefor.