CONSOLIDATED EDISON CO OF NEW YORK INC, DEF 14A, 1999-04-05

CONSOLIDATED EDISON CO OF NEW YORK INC
DEF 14A, 1999-04-05
ELECTRIC & OTHER SERVICES COMBINED

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SCHEDULE 14A INFORMATION

PROXY STATEMENT PURSUANT TO SECTION 14(A) OF THE SECURITIES
EXCHANGE ACT OF 1934 (AMENDMENT NO. )

Filed by the Registrant [X]

Filed by a Party other than the Registrant [ ]

Check the appropriate box:

<TABLE>
<S> <C>
[ ] Preliminary Proxy Statement [ ] Confidential, for Use of the Commission
Only (as permitted by Rule 14a-6(e)(2))
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Section 240.14a-11(c) or Section 240.14a-2.
</TABLE>

Consolidated Edison, Inc. and Consolidated Edison Company of New York, Inc.
- - --------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)

- - --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than Registrant)

Payment of Filing Fee (Check the appropriate box):

[X] No fee required.

[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-12.

(1) Title of each class of securities to which transaction applies:

------------------------------------------------------------------------

(2) Aggregate number of securities to which transaction applies:

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(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which the
filing fee is calculated and state how it was determined):

------------------------------------------------------------------------

(4) Proposed maximum aggregate value of transaction:

------------------------------------------------------------------------

(5) Total fee paid:

------------------------------------------------------------------------

[ ] Fee paid previously with preliminary materials.

[ ] Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number,
or the Form or Schedule and the date of its filing.

(1) Amount Previously Paid:

------------------------------------------------------------------------

(2) Form, Schedule or Registration Statement No.:

------------------------------------------------------------------------

(3) Filing Party:

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(4) Date Filed:

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LOGO
- - --------------------------------------------------------------------------------

LETTER TO
STOCKHOLDERS
JOINT NOTICE OF 1999
ANNUAL MEETINGS
AND
JOINT PROXY
STATEMENT

MAY 17, 1999
THE THEATER AT
MADISON SQUARE GARDEN
<PAGE> 3

LOGO

4 Irving Place, New York, N.Y. 10003

- - --------------------------------------------------------------------------------
EUGENE R. MCGRATH
CHAIRMAN OF THE BOARD

April 5, 1999

Dear Stockholders:

You are cordially invited to attend the Joint Annual Meeting of
Consolidated Edison, Inc. ("CEI") and Consolidated Edison Company of New York,
Inc. ("Con Edison"). I hope that you will join the Boards and management of your
Companies at The Theater at Madison Square Garden, Seventh Avenue between 31st
and 33rd Streets, New York City on Monday, May 17, 1999 at 1:30 p.m.

CEI is the holding company of Con Edison. All outstanding shares of common
stock are shares of CEI. The outstanding shares of preferred stock are shares of
Con Edison. Therefore, if you hold shares of common stock, your stock is in CEI
and if you hold shares of preferred stock, your stock is in Con Edison.

The accompanying Joint Proxy Statement contains information about matters
to be considered at both the CEI and the Con Edison annual meetings. At the
Joint Annual Meeting, CEI stockholders will be asked to vote on the election of
Directors and the Con Edison stockholders will be asked to vote on the election
of Trustees. Stockholders of both companies will vote on the ratification of the
appointment of independent accountants for 1999.

In addition to the matters described above, CEI stockholders will be asked
to vote on two proposals submitted by individual stockholders described in the
attached Joint Proxy Statement, if the proposals are properly presented at the
annual meeting. For the reasons stated in the Joint Proxy Statement, the CEI
Board of Directors and management recommend that CEI stockholders vote against
these proposals.

Whether or not you plan to attend the Joint Annual Meeting, please date,
sign and return the enclosed proxy in the envelope provided. It is very
important that as many shares as possible be represented at the meeting.
Stockholders of record may also vote their shares by telephone. Instructions for
using this convenient telephone service are set forth on the enclosed proxy
card.

If after voting your proxy you come to the meeting, you may vote in person
even though you have previously voted your proxy.

Sincerely,

Eugene R. McGrath

Eugene R. McGrath
<PAGE> 4

LOGO

4 Irving Place, New York, N.Y. 10003

- - --------------------------------------------------------------------------------
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS

Dear Stockholders:

The Annual Meetings of Stockholders of Consolidated Edison, Inc. ("CEI")
and Consolidated Edison Company of New York, Inc. ("Con Edison") will be held
concurrently at The Theater at Madison Square Garden, Seventh Avenue between
31st and 33rd Streets, New York, New York, on Monday, May 17, 1999 at 1:30 P.M.,
E.D.S.T. for the following purposes:

a. For CEI stockholders to elect the members of the Board of Directors
and Con Edison stockholders to elect the members of the Board of Trustees
as described in the attached Proxy Statement;

b. For CEI and Con Edison stockholders to ratify and approve the
appointment of PricewaterhouseCoopers LLP ("PwC") as independent
accountants for the year 1999; and

c. For CEI stockholders only to act upon two stockholder proposals as
set forth in the Proxy Statement (attached hereto and incorporated herein
by reference); and

d. For CEI and Con Edison stockholders, to transact such other
business as may properly come before the meetings, or any adjournment
thereof.

If you hold shares in both CEI and Con Edison, you will be provided with a
proxy card for each company. Please return both cards in the envelopes provided,
if you do not vote by telephone.

You are cordially invited to attend the meeting. IF YOU PLAN TO ATTEND,
please mark the appropriate box on the enclosed proxy card and we will send you
an admission ticket. If you are a stockholder of record and vote by telephone,
you will have the opportunity to indicate that you plan to attend the meeting
and a ticket will be sent to you.

WHETHER OR NOT YOU PLAN TO ATTEND THE MEETING IN PERSON, WE URGE YOU TO
VOTE, SIGN AND DATE THE ENCLOSED PROXY AND RETURN IT PROMPTLY IN THE ENCLOSED
POSTAGE-PAID ENVELOPE, OR VOTE YOUR PROXY BY TELEPHONE IN ACCORDANCE WITH THE
INSTRUCTIONS ACCOMPANYING THE PROXY CARD. WE WILL SINCERELY APPRECIATE YOUR
DOING SO.

By Order of the Boards of Directors and
Trustees,

ARCHIE M. BANKSTON
Secretary

Dated: April 5, 1999
<PAGE> 5

PROXY STATEMENT

INTRODUCTION

This Joint Proxy Statement is provided to stockholders of Consolidated
Edison, Inc. ("CEI") and Consolidated Edison Company of New York, Inc. ("Con
Edison") (together "the Companies") in connection with their respective annual
meetings of stockholders and any adjournments or postponements thereof. The
annual meetings will be held concurrently at 1:30 p.m., in The Theater at
Madison Square Garden, Seventh Avenue between 31st and 33rd Streets, New York,
New York, on Monday, May 17, 1999.

SOLICITATION OF PROXIES

This Joint Proxy Statement and the accompanying proxy card are furnished in
connection with the solicitation of proxies by the Board of Directors of CEI and
the Board of Trustees of Con Edison which have their principal executive offices
at 4 Irving Place, New York, New York 10003, for use at their respective annual
meetings to be held on Monday, May 17, 1999. This Joint Proxy Statement and the
enclosed CEI and Con Edison forms of proxy are being mailed to stockholders on
or about April 5, 1999.

This solicitation of proxies for the annual meeting is being made by
management on behalf of the Boards of Directors and Trustees and will be made by
mail and by telephone, facsimile and electronic transmission or overnight
delivery. The expense of the solicitation will be borne by the Companies. The
expense will include reimbursement for postage and clerical expenses to
brokerage houses and other custodians, nominees or fiduciaries for forwarding
proxy material and other documents to beneficial owners of stock held in their
names. In addition, Morrow & Co. of New York, New York has been retained to
assist in the solicitation of proxies by the means described above. The
estimated cost of Morrow's services is $17,000, plus out-of-pocket expenses.

RECORD DATE, OUTSTANDING
VOTING SECURITIES AND VOTING RIGHTS

The Boards of Directors and Trustees have established March 30, 1999, as
the record date for the determination of stockholders of CEI and Con Edison
entitled to receive notice of and to vote at their respective meetings. On the
record date, there were outstanding 1,915,319 shares of $5 Cumulative Preferred
Stock of Con Edison and 228,572,294 shares of Common Stock of CEI and
235,488,094 shares of Common Stock of Con Edison (all of which are held by CEI),
each entitled to one vote per share upon the propositions to be presented. The
holders of Common Stock of CEI will vote on the election of Directors of CEI, on
the ratification of the appointment of independent accountants of CEI and on the
two stockholder proposals. The holders of Con Edison's $5 Preferred Stock and
Common Stock will vote on the Trustees of Con Edison and on the ratification of
the appointment of independent accountants.

Copies of the 1998 Annual Report are being mailed to all persons who as of
the record date were holders of record of any shares of any class of stock of
CEI or Con Edison.

The enclosed proxy card is for the number of shares registered in your name
with either CEI or Con Edison, together with any additional full shares held in
your name in CEI's Automatic Dividend Reinvestment and Cash Payment Plan. The
instructions on the proxy card provide that any shares registered in your name
and any full shares held for your account in the Plan will be voted in the same
manner.

In all matters other than the election of Directors or Trustees the
affirmative vote of a majority of the shares present in person or represented by
proxy at the annual meetings, entitled to vote and voting on the subject matter,
shall be the act of the stockholders. Abstentions and broker non-votes are voted
neither "for" nor "against", and have no effect on the vote, but are counted in
the

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determination of the quorums. Directors and Trustees will be elected by a
plurality of the votes present in person or represented by proxy at the annual
meetings, entitled to vote and voting on the election of Directors and Trustees.

EXECUTION AND REVOCATION OF PROXY

Shares represented by proxies properly signed and returned will be voted at
the Joint Annual Meeting. Each proxy will be exercised in accordance with the
stockholder's specifications thereon. If the proxy is signed but no
specification is made, the shares represented by the proxy will be voted for the
election of Directors or Trustees and in accordance with the recommendations of
the Boards of Directors and Trustees on other proposals.

Instead of submitting a signed proxy card, if you are a stockholder of
record located in the United States, you may vote your proxy by telephone using
the control number and instructions set forth on the proxy card. Telephone
proxies must be used in conjunction with, and will be subject to, the
information and terms contained on the proxy card. Voting by telephone
eliminates the need to return the proxy card. The telephone voting procedure may
not be available to stockholders who hold their shares through a broker,
nominee, fiduciary or other custodian.

A stockholder who gives a proxy may revoke it at any time before the proxy
is voted at the meetings. The proxy is revocable by a later dated written
document signed in the same manner as the proxy (or a later vote by telephone)
and received by the Secretary of the Companies at or before the Joint Annual
Meeting. Also, a stockholder who attends the meeting in person may vote by
ballot at the meeting, thereby canceling any proxy previously given.

ATTENDANCE AND PROCEDURES AT THE JOINT ANNUAL MEETING

Attendance at the Joint Annual Meeting will be limited to stockholders of
record, beneficial owners of either CEI or Con Edison stock entitled to vote at
the meeting having evidence of ownership, the authorized representative (one
only) of an absent stockholder, and invited guests of management. Any person
claiming to be an authorized representative of a stockholder must, upon request,
produce written evidence of such authorization. In order to assure the holding
of a fair and orderly meeting and to accommodate as many stockholders as
possible who may wish to speak at the Joint Annual Meeting, management will
limit the general discussion portion of the meeting to one hour and permit only
stockholders or their authorized representatives to address the meeting. In
addition, management will require that all signs, banners, placards and
protest-type materials be left outside the meeting room.

MATTERS TO BE CONSIDERED AT THE JOINT ANNUAL MEETING

ELECTION OF DIRECTORS AND TRUSTEES

(ITEM 1 ON PROXY CARD)

Eleven Directors of CEI and eleven Trustees of Con Edison are to be
elected, respectively, at the Joint Annual Meeting of stockholders to hold
office until the next annual meeting and until their respective successors shall
have been elected and qualified. In addition, if the pending merger between CEI
and Orange and Rockland Utilities, Inc. ("O&R") closes prior to the Joint Annual
Meeting, it is the intention of management to propose for election to the Board
of CEI an additional Director, Mr. Michael J. Del Giudice, who is currently
Chairman of the Board of Directors of O&R. Mr. Del Giudice will not serve on the
Board of Con Edison. If the closing of the O&R merger occurs after the Joint
Annual Meeting, Mr. Del Giudice will join the Board at that time. Other than Mr.
Del Giudice, the nominees for Directors of CEI and for Trustees of Con Edison
whom the respective Boards propose for election are the same. Of the Board
members standing for election, two (Eugene R. McGrath and Joan S. Freilich) are
officers of both CEI and Con Edison. The current non-officer nominees bring to
the Companies the benefit of their broad expertise and experience in many
diverse fields.

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Since the last Joint Annual Meeting, the number of members of the Boards of
CEI and Con Edison has remained at eleven. With the effective date of the
election of Mr. Del Giudice the number of directors of CEI will be increased to
twelve. Since the last annual meeting, the by-laws of each company were amended
to provide for the Board to appoint the transfer agent for the respective
company's securities. Prior to the amendments, the by-laws provided that each
company would act as its own transfer agent.

With the exception of Mr. Del Giudice, all of the nominees were elected
Directors and Trustees at the last Joint Annual Meeting. The Companies'
management believes that all of the nominees will be able and willing to serve
as Directors and Trustees of the Companies.

Shares represented by every properly signed proxy will be voted at the
Joint Annual Meeting for the election of Directors and Trustees of the persons
nominated by management, except where the right to vote such shares is withheld
as provided in the proxy or otherwise instructed. If one or more of the nominees
is unable or unwilling to serve, the shares represented by the proxies will be
voted for the other nominees and for any substitute nominee or nominees as shall
be designated by management.

INFORMATION ABOUT NOMINEES

The name and age of each of the nominees, the year in which each was first
elected a Director and Trustee, the principal occupation and business experience
of each during the past five years, the number of shares of Common Stock of CEI
beneficially owned by each as of the close of business on January 31, 1999,
their directorships in other publicly-held business corporations and the more
significant of their directorships in charitable and educational organizations
as of that date are set forth below, based on information provided by the
nominees.

<TABLE>
<CAPTION>
NAME, AGE, LENGTH OF SERVICE AS A DIRECTOR AND TRUSTEE
AND PRINCIPAL OCCUPATION AND BUSINESS
EXPERIENCE DURING PAST 5 YEARS
------------------------------
<S> <C>
PHOTO E. VIRGIL CONWAY, 69
Chairman, Metropolitan Transportation Authority, New York,
N.Y. (public transportation) since April 1995. Mr. Conway
has been a Trustee of Con Edison since 1970 and a Director
of CEI since December 1997. Mr. Conway was Chairman of the
Financial Accounting Standards Advisory Council from 1992 to
July 1995. Director or Trustee, Accuhealth, Inc., Atlantic
Mutual Insurance Company, Centennial Insurance Company, HRE
Properties, certain mutual funds managed by Phoenix
Investment Partners, Trism, Inc. (Chairman), Union Pacific
Corporation, Josiah Macy, Jr. Foundation, Pace University,
and Chairman, New York Housing Partnership Development
Corporation.
Shares owned: 13,692

PHOTO PETER W. LIKINS, 62
President, University of Arizona, Tucson, Arizona since
October 1, 1997. Dr. Likins was previously President of
Lehigh University, Bethlehem, Pa. Dr. Likins has been a
Trustee of Con Edison since 1978 and a Director of CEI since
December 1997. Director or Trustee, COMSAT Corporation,
Parker-Hannifin Corporation, Safeguard Scientifics, Inc.,
Udall Foundation and University Medical Center. Member,
National Academy of Engineering.
Shares owned: 1,700

PHOTO RUTH M. DAVIS, 70
President and Chief Executive Officer, The Pymatuning Group,
Inc., Alexandria, Va. (technology management). Dr. Davis has
been a Trustee of Con Edison since 1981 and a Director of
CEI since December 1997. Director or Trustee, BTG, Inc.,
Ceridian Corporation, Premark International, Inc., Principal
Mutual Life Insurance Company, Tupperware Corporation,
Varian Associates and The Aerospace Corporation (Chairman).
Member, American Academy of Arts and Sciences, National
Academy of Engineering and University of Maryland Board of
Visitors.
Shares owned: 3,186
</TABLE>

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<TABLE>
<CAPTION>
NAME, AGE, LENGTH OF SERVICE AS A DIRECTOR AND TRUSTEE
AND PRINCIPAL OCCUPATION AND BUSINESS
EXPERIENCE DURING PAST 5 YEARS
------------------------------
<S> <C>
PHOTO EUGENE R. MCGRATH, 57
Chairman of the Board, President and Chief Executive Officer
of CEI since October 1997. Chairman and Chief Executive
Officer of Con Edison since September 1990. He was also
President of Con Edison from September 1990 through February
1998. Mr. McGrath has been a Trustee of Con Edison since
1987 and a Director of CEI since October 1997. Director or
Trustee, Atlantic Mutual Insurance Company, Federal Reserve
Bank of N.Y., Business Council of New York State, Inc., New
York City Partnership and Chamber of Commerce, American
Museum of Natural History, Barnard College, National Action
Council for Minorities in Engineering, Inc., American
Woman's Economic Development Corporation, The Fresh Air
Fund, the Wildlife Conservation Society and the United Way
of New York City. Member, National Academy of Engineering.
Shares owned: 14,400

PHOTO GORDON J. DAVIS, 57
Partner, LeBoeuf, Lamb, Greene & MacRae, L.L.P., Attorneys
at Law, New York, N.Y. Mr. Davis has been a Trustee of Con
Edison since 1989 and a Director of CEI since December 1997.
Director or Trustee, Phoenix Home Life Mutual Insurance
Company, certain mutual funds managed by the Dreyfus
Corporation, Lincoln Center for the Performing Arts, Inc.,
Jazz at Lincoln Center, Inc. (Chairman) and the New York
Public Library.
Shares owned: 1,730

PHOTO ELLEN V. FUTTER, 49
President and Trustee, American Museum of Natural History,
New York, N.Y. Ms. Futter has been a Trustee of Con Edison
since 1989 and a Director of CEI since December 1997.
Director, Trustee or Member, American International Group,
Inc., Bristol-Myers Squibb Company, J.P. Morgan & Co., Inc.,
Council on Foreign Relations and New York City Partnership.
Shares owned: 2,114

PHOTO ROBERT G. SCHWARTZ, 71
Director and former Chairman of the Board, President and
Chief Executive Officer, Metropolitan Life Insurance
Company, New York, N.Y. Mr. Schwartz has been a Trustee of
Con Edison since 1989 and a Director of CEI since December
1997. Director or Trustee, COMSAT Corporation, Lone Star
Industries, Inc., Lowe's Companies Inc., Mobil Corporation,
Potlatch Corporation, Committee for Economic Development,
Horatio Alger Association and Smeal College of Business
Administration at Penn State University (Board of Visitors).
Shares owned: 2,200

PHOTO RICHARD A. VOELL, 65
Private investor and retired President and Chief Executive
Officer of The Rockefeller Group, New York, N.Y. (real
estate, real estate services and communications and
communications services) from 1982 to June 1995. Mr. Voell
has been a Trustee of Con Edison since 1990 and a Director
of CEI since December 1997. Trustee or Member, Council on
Foreign Relations. Director and Member of the Nominating
Committee of the Wildlife Conservation Society. Vice
Chairman, United Nations Association and Past Chairman,
Economic Club of New York.
Shares owned: 4,515
</TABLE>

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<TABLE>
<CAPTION>
NAME, AGE, LENGTH OF SERVICE AS A DIRECTOR AND TRUSTEE
AND PRINCIPAL OCCUPATION AND BUSINESS
EXPERIENCE DURING PAST 5 YEARS
------------------------------
<S> <C>
PHOTO SALLY HERNANDEZ-PINERO, 46
Managing Director, Fannie Mae, American Communities Fund,
Washington, D.C. since July, 1998. Mrs. Hernandez-Pinero was
of counsel to the law firm of Kalkines, Arky, Zall &
Bernstein, New York, N.Y. from 1994 to May 1998. Mrs.
Hernandez-Pinero has been a Trustee of Con Edison since 1994
and a Director of CEI since December 1997. Director or
Trustee, Accuhealth, Inc., American Museum of Natural
History, The Dime Savings Bank, Goodwill Industries and
National Income Realty Trust.
Shares owned: 1,025

PHOTO STEPHEN R. VOLK, 62
Senior Partner, Shearman & Sterling, Attorneys at Law, New
York, N.Y. Mr. Volk has been a Trustee of Con Edison since
1996 and a Director of CEI since December 1997. Member,
Council on Foreign Relations and the Harvard Law School
Dean's Advisory Board. Director and Member of Executive
Committee, New York City Partnership.
Shares owned: 2,058

PHOTO JOAN S. FREILICH, 57
Executive Vice President and Chief Financial Officer of CEI
and Con Edison since March 1998. She was Senior Vice
President and Chief Financial Officer of CEI from October
1997 to February 1998 and of Con Edison from July 1996 to
February 1998. Ms. Freilich has been a Trustee of Con Edison
since 1997 and a Director of CEI since October 1997.
Trustee, Citizens Budget Commission. Member, Financial
Executives Institute. President, New York State Women in
Communications and Energy.
Shares owned: 1,879

PHOTO MICHAEL J. DEL GIUDICE, 56
Mr. Del Giudice is a Managing Director/Principal of
Millennium Credit Markets, LLC, New York, N.Y. He co-founded
Millennium in 1996. Prior to working at Millennium Credit
Markets, Mr. Del Giudice was a Managing Director and General
Partner of Lazard Freres & Co., LLC, from 1985 through 1995
and First Vice President of Shearson American, from 1981 to
1983. Mr. Del Giudice has been Chairman of the Board of
Directors of Orange and Rockland Utilities, Inc. since
February 1998. He has been a Director of O&R since 1988,
serves as a member of the Executive Committee, and was
formerly Chair of the Audit Committee. Mr. Del Giudice was
Secretary and Chief of Staff to the Governor of New York
from 1983 to 1985, Director of State Operations from 1979 to
1981 and Secretary to the New York State Assembly Speaker
from 1974 to 1979. Member, Board of Advisors of Curran &
Conners Inc.; Chairman of the Governor's Committee on
Scholastic Achievement.
Shares owned: 100*
</TABLE>

The number of shares of Common Stock of CEI beneficially owned as of
January 31, 1999, by each of the executive officers named in the compensation
table on page 12 who are not also nominees is set forth below.

<TABLE>
<CAPTION>
NAME SHARES OWNED
---- ------------
<S> <C>
Charles F. Soutar........................................... 4,993
J. Michael Evans............................................ 1,291
Stephen B. Bram............................................. 476*
</TABLE>

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* As of March 31, 1999.

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As of January 31, 1999, no nominee or officer was the beneficial owner of
any other class of equity securities of CEI or Con Edison or beneficially owned
more than .006 percent of the total outstanding Common Stock of CEI. As of the
same date all officers and members of the Boards as a group beneficially owned
102,651 shares (.043 percent) of the outstanding Common Stock of CEI. Each
officer and member of the Boards held his or her shares with sole voting power
and sole investment power, except for shares as to which voting power, or
investment power, or both, were shared with a spouse or a relative of such
person.

To the best knowledge of the management of CEI, no person owned
beneficially as of January 31, 1999, more than 5 percent of any class of voting
securities of CEI or of Con Edison, except that all shares of Common Stock of
Con Edison are held by CEI.

SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE

Section 16(a) of the Securities Exchange Act of 1934 requires the
Directors, Trustees and executive officers of the Companies to file reports of
ownership and changes in ownership of the equity securities of the Companies and
its affiliates with the Securities and Exchange Commission and to furnish copies
of these reports to the Companies. Based upon its review of the reports
furnished to the Companies for 1998 pursuant to Section 16(a) of the Act and
written representations from certain reporting persons, the Companies believe
that all of the reports were filed on a timely basis.

BOARD MEMBERS' FEES AND ATTENDANCE

Those members of the Boards who are not employees of CEI or Con Edison are
paid an annual retainer of $26,000, a fee of $1,200 for each meeting of the
Boards attended, and a fee of $1,000 for each meeting of a Committee of the
Boards attended, except that if a Committee meeting is held on the same day as a
Board meeting, the fee paid for attending the Committee meeting is $800. CEI and
Con Edison will reimburse Board members, who are not currently officers of the
Companies, for expenses incurred in attending Board and Committee meetings. No
person who serves on both the CEI and the Con Edison Boards and the
corresponding Committees is paid additional compensation for concurrent service.

The Chairs of the Audit, Budget and Contracts, Environmental, Executive
Personnel and Pension, Finance, Nominating and Planning Committees each receive
an annual retainer fee of $4,000, provided, however, that if any Director or
Trustee is serving at the same time as the Chairman of the Budget and Contracts
Committee and the Finance Committee he or she is paid only one such annual
retainer. The Acting Chairman of any Board Committee is paid an additional
meeting fee of $200 for any Committee meeting at which he or she presides.
Members of the Board may participate in the Discount Stock Purchase Plan, the
Deferred Compensation Plan and the Retirement Plan for Non-Officer Directors
described below. Members of the Boards who are officers of the Companies receive
no retainer or meeting fees for their service on the Boards.

Effective October 1, 1998, CEI adopted a Restricted Common Stock Plan for
Non-Officer Directors. Under the plan each non-officer director received 200
shares of CEI Common Stock on the adoption of the plan. Each Director will
receive an additional award of 200 shares following each Annual Meeting. A new
Director will receive 200 shares upon joining the Board. The shares are
purchased on the open market. Shares of stock received under the plan may not be
transferred by the Director (except to a family member or a trust or other
entity for estate planning purposes) without the permission of CEI's Board or
Executive Personnel Committee of the Board until the earlier of (i) five years
from the date of grant, (ii) retirement from the Board at age 72 or earlier with
the permission of the Board or the Committee, (iii) the death of the Director or
(iv) a change in control of CEI.

The Companies have a deferred compensation plan applicable to non-officer
members of the Boards. A Board member who elects to participate in the plan may
defer all or a portion of the

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<PAGE> 11

compensation paid by the Companies with interest. As of April 1, 1999, two
former Trustees of Con Edison were participants in the plan.

The Companies have a retirement plan for those Board members who are not
entitled to receive employee pension benefits from the Companies. The plan
provides that a member who retires from the Boards and who has completed ten
full years of service on the Boards shall receive annually, for life, commencing
at age 65 or the date of retirement, whichever is later, a benefit in an amount
equal to the then annual retainer being paid to the active members of the
Boards, changing as and when such annual retainer changes. The benefits for a
Board member who retires with less than ten years of service are prorated. As of
April 1, 1999, four former Trustees of Con Edison were participants in the plan.

The Discount Stock Purchase Plan permits employees of Con Edison, including
executive officers, to contribute up to 20 percent of their salaries into the
plan, but not more than $25,000 per year. Non-officer members of the Boards are
eligible to participate and may contribute up to $1,000 per month. Also,
dividends may be reinvested. Con Edison contributes one-ninth of the
participant's contributions, including reinvested dividends. The contributions
are used to purchase outstanding shares of Common Stock of CEI for the
participants. Con Edison pays brokerage and other expenses relating to the plan.

The law firm of LeBoeuf, Lamb, Greene & MacRae of which Mr. Davis is a
partner provided services to Con Edison in 1998 and will provide services in
1999. The law firm of Shearman & Sterling of which Mr. Volk is Senior Partner
has provided services to Con Edison and to a subsidiary of CEI in 1998 and 1999.

The Board of Directors of CEI held three special meetings in 1998. The
Boards of CEI and Con Edison held ten regular meetings in 1998. During 1998 each
incumbent member of the Boards attended more than 75 percent of the combined
meetings of the Boards and the Board Committees on which he or she served.

STANDING COMMITTEES OF THE BOARDS

CEI and Con Edison have identical standing Committees. In most instances
CEI's and Con Edison's standing Committees met jointly in 1998.

The Audit Committees, composed of four non-officer Directors and Trustees
(Mrs. Hernandez-Pinero, Chair, Dr. Davis, Ms. Futter and Mr. Schwartz), meets
with the Companies' managements, including the Con Edison General Auditor, and
their independent accountants, several times a year to discuss internal controls
and accounting matters, the Companies' financial statements and the scope and
results of the auditing programs of the independent accountants and of the Con
Edison internal auditing department. The Audit Committees also recommend to the
Boards of Directors and Trustees the appointment of the independent accountants
for the Companies, subject to stockholders' approval at the annual meetings. The
Audit Committees held three meetings in 1998.

The Budget and Contracts Committees, composed of five non-officer Directors
and Trustees (Dr. Davis, Chair and Messrs. Conway, Davis, Likins and Schwartz),
examine and make recommendations to the Board with respect to the annual capital
budgets of CEI and Con Edison, major purchase authorizations, investments and
contractual commitments, and the annual operating budgets, receive a five-year
forecast of capital budget expenditures and review major real estate
transactions and litigation settlements. The Budget and Contracts Committees
held nine meetings during 1998.

The Environmental Committees, composed of five non-officer Directors and
Trustees (Ms. Futter, Chair, Dr. Davis, Mrs. Hernandez-Pinero and Messrs. Davis
and Likins), provide advice and counsel to the Companies' managements on
corporate environmental policy and on such other environmental matters as from
time to time the Committees deem appropriate; review significant new
developments in environmental laws and governmental agency actions as they
affect

7
<PAGE> 12

the Companies' corporate environmental policies; review significant issues
relating to the Companies' compliance with environmental laws and regulations
and corporate environmental policies; meet annually with the Planning Committees
to review and evaluate planning and environmental issues; submit recommendations
to the Boards with respect to environmental-related matters; and make such other
reviews and recommend to the Boards such other actions as they may deem
necessary or desirable to help promote sound planning by the Companies with due
regard to the protection of the environment. The Environmental Committees held
five meetings in 1998.

The Executive Committees, composed of Mr. McGrath, the Chairman of the
Board and of the Committees, and four non-officer Directors and Trustees
(Messrs. Conway, Likins, Voell and Volk), may exercise during intervals between
the meetings of each Board all the powers vested in the Boards, except for
certain specified matters. No meetings of the Executive Committees were held in
1998.

The Executive Personnel and Pension Committees, composed of four
non-officer Directors and Trustees (Mr. Conway, Chair, Mrs. Hernandez-Pinero and
Messrs. Schwartz and Voell), report and make recommendations to the Boards
relating to officer and senior management appointments and compensation. In
addition, the Committees make incentive compensation awards to officers
participating in Con Edison's Executive Incentive Plan, subject to confirmation
by the Board and administer CEI's Stock Option Plan, including determining the
recipients of, and the number of shares covered by, stock option grants. The
Committees also review and make recommendations as necessary to provide for
orderly succession and transition in the executive management of the Companies
and receive reports and make recommendations with respect to minority and female
recruitment, employment and promotion. They also oversee and make
recommendations to the Boards with respect to compliance with the Employee
Retirement Income Security Act of 1974 ("ERISA"), and review and make
recommendations with respect to new benefit plans and plan amendments, the
selection of plan trustees and the funding policy and contributions to the
funded plans, and review the performance of the funded plans. The Executive
Personnel and Pension Committees held seven meetings during 1998.

The Finance Committees, which are composed of five non-officer Directors
and Trustees (Mr. Schwartz, Chair, Dr. Davis and Messrs. Conway, Davis and
Likins), review and make recommendations to the Boards with respect to the
Companies' financial condition and policies, their dividend policies, bank
credit arrangements, financings, investments, nuclear decommissioning funds, and
other financial matters, and review five-year financial forecasts. The Finance
Committees held ten meetings during 1998. CEI's Finance Committee met separately
once during 1998.

The Nominating Committees, composed of five non-officer Directors and
Trustees (Mr. Voell, Chair, Ms. Futter and Messrs. Conway, Schwartz and Volk),
are responsible for recommending candidates to fill vacancies on the Boards. In
addition, the Committees assist with respect to the composition and size of the
Boards and of all Committees of the Boards. The Committees also make
recommendations to the Boards as to the compensation of Board members and
members of the committees as well as other corporate governance matters. The
Nominating Committees held four meetings in 1998. The Committees have no formal
procedures for consideration of recommendations for nominations to the Boards.
They consider candidates proposed by stockholders. Nominations for candidates,
accompanied by biographical material for evaluation, may be sent to the
Secretary of the Companies. Each nomination should include information as to the
qualifications of the candidate and should be accompanied by a written statement
(presented to the Secretary of the Companies) from the suggested candidate, to
the effect that the candidate is both willing and affirmatively desirous of
serving.

The Planning Committees, composed of six non-officer Directors and Trustees
(Dr. Likins, Chair, Dr. Davis, Ms. Futter, Mrs. Hernandez-Pinero and Messrs.
Davis and Volk), examine and make recommendations to the Boards regarding long
range planning for the Companies. The Planning Committees held three meetings in
1998.

8
<PAGE> 13

COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION

Mrs. Hernandez-Pinero and Messrs. Conway, Schwartz and Voell were the
members of Con Edison's and CEI's Executive Personnel and Pension Committees in
1998. The Companies believe that there are no interlocks with the members who
serve on these Committees.

MANAGEMENT PROPOSAL

(ITEM 2 ON PROXY CARD)

PROPOSAL NO. 2--Ratification of the Appointment of PricewaterhouseCoopers LLP as
Independent Accountants for the Year 1999.

At the Joint Annual Meeting, the Board will recommend that the stockholders
ratify and approve the selection of PricewaterhouseCoopers LLP ("PwC") as
independent accountants for the Companies for the year 1999. PwC has acted in
the same capacity for Con Edison for many years.

Before the Audit Committees recommended the appointment of PwC, they
considered that firm's qualifications. This included a review of their
performance in prior years, as well as their reputation for integrity and for
competence in the fields of accounting and auditing. The Audit Committees have
expressed their satisfaction with PwC in these respects. The Audit Committees
reviewed information provided by PwC concerning litigation involving that firm
and the existence of any investigations by the Securities and Exchange
Commission into the financial reporting practices of companies audited by them.
As to these matters, the Audit Committees have concluded that the ability of PwC
to perform services in 1999 for the Companies is not in any way adversely
affected by any litigation or investigations reflected in such information.

Representatives of PwC will be present at the Joint Annual Meeting and will
be afforded the opportunity to make a statement if they desire to do so and to
respond to appropriate questions.

In connection with the 1998 audit of CEI and Con Edison, PwC reviewed the
Companies' annual report and examined the related financial statements, reviewed
interim financial statements and certain of the Companies' filings with the
Federal Energy Regulatory Commission, the New York State Public Service
Commission and the Securities and Exchange Commission. PwC also performed audits
of the financial statements of Con Edison's pension and certain other benefit
plans. Fees for PwC's audit services performed in 1998 totaled $782,000.

Adoption of Proposal No. 2 requires for CEI the affirmative vote of a
majority of the shares of CEI's Common Stock and for Con Edison the affirmative
vote of a majority of the shares of Con Edison's Common Stock and $5 Cumulative
Preferred Stock (voting together as a single class) voted on the proposals at
the Joint Annual Meeting.

THE BOARDS RECOMMEND A VOTE FOR PROPOSAL NO. 2.

The following two proposals are deemed to apply to CEI.

STOCKHOLDER PROPOSALS

(ITEM 3 ON PROXY CARD)

PROPOSAL NO. 3--John J. Gilbert, 29 East 64th Street, New York, N.Y. 10021-7043,
owning in brokers names 125 shares, and/or Margaret R. Gilbert (same address),
owning in brokers names 124 shares, and both Executors of the Estate of Lewis
D. Gilbert for 100 shares, and/or Edith and/or Edward Rudy, Box 7077,
Yorkville Station, New York, N.Y. 10128-7077, owning in brokers names 2,052
shares of Common Stock have submitted the following proposal:

"RESOLVED: That the stockholders of Consolidated Edison, Inc.,
assembled in annual meeting in person and by proxy, hereby request the
Board of Directors to take the steps necessary to provide for cumulative
voting in the election of directors, which means each stockholder shall be
entitled to as many votes as shall equal the number of shares he or she

9
<PAGE> 14

owns multiplied by the number of directors to be elected, and he or she may
cast all of such votes for a single candidate, or any two or more of them
as he or she may see fit."

The statement made in support of this proposal is as follows:

"Continued strong support along the lines we suggest were shown at the last
annual meeting when 25%, 8,231 owners of 37,868,522 shares, were cast in favor
of this proposal. The vote against included 8,885 unmarked proxies.

"California law requires that unless stockholders have voted not to have
cumulative voting they will have it. Ohio has the same provision.

"The National Bank Act provides for cumulative voting. Companies get around
it by forming holding companies without cumulative voting. Banking and other
authorities should question the capability of directors to be on boards. In many
cases authorities come in after and say the director or directors were not
qualified. We were delighted to see the SEC has finally taken action to prevent
bad directors from being on boards of public companies. The SEC should have more
hearings to prevent such persons becoming directors before they harm investors.

"The recent banking failures throughout the world shows the importance of
cumulative voting to get better directors on the board.

"Many successful corporations have cumulative voting. Pennzoil defeated
Texaco in that famous case. Texaco's recent problems might have been prevented
with cumulative voting, getting directors on the board to prevent such things.
Ingersoll-Rand won two awards having cumulative voting.

"Another good example is Union Pacific, having troubles with freight
shipments which were backed up for months. The merger with Southern Pacific was
the excuse. Two years ago, Union Pacific took away cumulative voting.

"Lockheed-Martin, as well as VWR Corporation have a provision that if
anyone has 40% or more of the shares cumulative voting applies.

"In 1995 American Premier adopted cumulative voting. Allegheny Power System
tried to take away cumulative voting but the stockholders defeated it, showing
stockholders are interested in their rights. Very successful Hewlett Packard has
cumulative voting.

"If you agree, please mark your proxy for this resolution; otherwise it is
automatically cast against it, unless you have marked to abstain."

THE BOARD OF DIRECTORS RECOMMENDS A VOTE AGAINST PROPOSAL NO. 3 FOR THE
FOLLOWING REASONS:

The same proposal was submitted by Mr. Gilbert to nine of the Companies'
annual meetings of stockholders held from 1984 through 1998, to each of six
annual meetings held from 1974 through 1979 and to several prior meetings and
was overwhelmingly defeated each time. The proposal, in the opinion of the Board
of Directors, is contrary to the best interests of CEI and its stockholders. The
Directors, in administering the affairs of CEI, should function for the benefit
of all stockholders. The present system of voting for the election of Directors,
under which the holders of a plurality of the votes cast at a meeting of
stockholders elect a Board of Directors to represent all the stockholders, has
served well. If this proposal were adopted, a Director who was elected only
because of cumulative voting might represent and act for the benefit of a
special interest rather than for the benefit of all stockholders.

In the opinion of counsel, this resolution, if adopted, would not
constitute an amendment of the Certificate of Incorporation of CEI permitting
cumulative voting, but would constitute a formal request by the stockholders
that the Board of Directors submit to a later meeting of the stockholders

10
<PAGE> 15

a proposal to amend CEI's Certificate of Incorporation so as to permit
cumulative voting by CEI's stockholders in voting for the election of members of
the Board of Directors.

THE BOARD OF DIRECTORS RECOMMENDS A VOTE AGAINST PROPOSAL NO. 3.

(ITEM 4 ON PROXY CARD)

PROPOSAL NO. 4--Mrs. Evelyn Y. Davis, Watergate Office Building, 2600 Virginia
Avenue, N.W., Suite 215, Washington, D.C. 20037, who owns 200 shares of Common
Stock, has submitted the following proposal:

"RESOLVED: That the shareholders recommend that the Board take the
necessary step that Con Edison specifically identify by name and corporate
title in all future proxy statements those executive officers, not
otherwise so identified, who are contractually entitled to receive in
excess of $250,000 annually as a base salary, together with whatever other
additional compensation bonuses and other cash payments were due them."

The statement made in support of this proposal is as follows:

"In support of such proposed Resolution it is clear that the shareholders
have a right to comprehensively evaluate the management in the manner in which
the Corporation is being operated and its resources utilized. At present only a
few of the most senior executive officers are so identified, and not the many
other senior executive officers who should contribute to the ultimate success of
the Corporation. Through such additional identification the shareholders will
then be provided an opportunity to better evaluate the soundness and efficacy of
the overall management.

"Last year the owners of 15,229,325 shares, representing approximately
10.0% of shares voting, voted FOR my similar proposal.

"If you AGREE, please mark your proxy FOR this proposal."

THE BOARD OF DIRECTORS RECOMMENDS THAT YOU VOTE AGAINST PROPOSAL NO. 4 FOR
THE FOLLOWING REASONS:

Disclosure of executive compensation is governed by the Securities and
Exchange Commission's proxy solicitation rules. In accordance with those rules
CEI currently provides information on pages 12 through 18 of the Proxy Statement
concerning compensation for the five highest paid executive officers.

The proposal would impose on CEI more stringent disclosure requirements
than those imposed on other companies by the Commission's rules. The Board
believes that any changes in the disclosure requirements should emanate from the
Commission and should be uniformly applicable to all companies subject to the
proxy rules.

THE BOARD OF DIRECTORS RECOMMENDS A VOTE AGAINST PROPOSAL NO. 4.
- - --------------------------------------------------------------------------------

Adoption of the preceding stockholder resolutions (Proposals 3 and 4) would
require the affirmative vote of a majority of shares of Common Stock of CEI
voted thereon at the meeting.

- - --------------------------------------------------------------------------------

11
<PAGE> 16

EXECUTIVE COMPENSATION

SUMMARY COMPENSATION TABLE

The following table sets forth the compensation of the Companies' Chief
Executive Officer and the four most highly compensated executive officers other
than the Chief Executive Officer who were serving as executive officers at the
end of 1998. The positions shown are the officers' positions with Con Edison as
of December 31, 1998.

<TABLE>
<CAPTION>
LONG TERM
ANNUAL COMPENSATION COMPENSATION
-------------------------------------- ------------
OTHER
ANNUAL OPTION ALL OTHER
NAME AND PRINCIPAL POSITION YEAR SALARY BONUS COMPENSATION SHARES COMPENSATION(3)
--------------------------- ---- ------ ----- ------------ ------------ ---------------
<S> <C> <C> <C> <C> <C> <C>
Eugene R. McGrath................ 1998 $865,000 $594,750 $17,636 70,000 $26,116
Chairman of the Board 1997 $790,000 $518,700 $17,251 70,000 $25,641
and Chief Executive Officer(1)(2) 1996 $721,667 $422,663 $17,513 70,000 $25,582
J. Michael Evans................. 1998 $396,333 $220,000 -- 20,000 $ 7,650
President and Chief Operating 1997 $349,667 $150,000 -- 20,000 $ 7,650
Officer 1996 $329,667 $115,000 -- 20,000 $ 7,350
Charles F. Soutar................ 1998 $391,333 $150,000 -- 20,000 $ 7,650
Executive Vice President-- 1997 $371,333 $145,000 -- 18,000 $ 7,650
Central Services 1996 $351,333 $115,000 -- 16,000 $ 7,350
Joan S. Freilich................. 1998 $271,553 $167,500 -- 20,000 $ 7,500
Executive Vice President 1997 $210,000 $101,000 -- 18,000 $ 6,300
and Chief Financial Officer(1) 1996 $177,000 $ 80,000 -- 16,000 $ 5,310
Stephen B. Bram.................. 1998 $327,333 $ 90,000 -- 16,000 $ 7,650
Senior Vice President-- 1997 $309,500 $ 80,000 -- 16,000 $ 7,650
Central Operations 1996 $291,500 $ 90,000 -- 16,000 $ 7,350
</TABLE>

- - ------------
(1) Holds same positions with CEI.

(2) Also President of CEI.

(3) The amounts shown in this column consist of amounts contributed by Con
Edison under its Discount Stock Purchase Plan (DISCOP) and Thrift Savings Plan
for Management Employees (Thrift Plan) and amounts paid for life insurance for
Mr. McGrath, as follows: For 1998, Mr. McGrath, life insurance--$18,466, Thrift
Plan--$7,650; Mr. Evans, Thrift Plan--$7,650; Mr. Soutar, Thrift Plan--$7,650;
Ms. Freilich, Thrift Plan--$7,500; Mr. Bram, Thrift Plan--$7,650. For 1997, Mr.
McGrath, life insurance--$17,991, Thrift Plan--$7,650, Mr. Evans, Thrift
Plan--$7,650, Mr. Soutar, Thrift Plan--$7,650; Ms. Freilich, Thrift Plan--
$6,300; Mr. Bram, Thrift Plan--$7,650. For 1996, Mr. McGrath, life
insurance--$17,941, Thrift Plan--$7,350, DISCOP--$291; Mr. Evans, Thrift
Plan--$7,350; Mr. Soutar, Thrift Plan--$7,350; Ms. Freilich, Thrift
Plan--$5,310; Mr. Bram, Thrift Plan--$7,350.

EMPLOYMENT CONTRACTS OF EXECUTIVE OFFICERS LISTED IN THE SUMMARY COMPENSATION
TABLE

Mr. McGrath has an agreement with the Companies that provides for his
employment on a year-to-year basis with automatic one-year extensions unless the
Companies or Mr. McGrath terminate the agreement upon at least twelve months'
prior notice. The agreement provides for Mr. McGrath to receive an annual salary
of $890,000 (effective September 1, 1998), plus annual deferred compensation of
$25,000 with interest. Mr. McGrath's salary is reviewed annually by the
Executive Personnel and Pension Committees and, with the concurrence of the
Boards, may be increased as a result of that review. The agreement also provides
for the purchase of supplemental term life insurance for Mr. McGrath, the
premiums for which are included in the Summary Compensation Table.

12
<PAGE> 17

REPORT ON EXECUTIVE COMPENSATION

The Companies' executive compensation policies are administered by the
Executive Personnel and Pension Committees of the Boards which were composed of
four Board members in 1998. All action by the Committee pertaining to executive
compensation, except for awards under the 1996 Stock Option Plan, is submitted
to the full Boards for approval. The Committees submit the following report
related to compensation matters for 1998.

The Committees' compensation policy -- The Committees believe that total
executive compensation should be such as to attract to the Companies, motivate
and reasonably reward individuals of the highest professional and personal
qualifications and, at the same time, secure substantial and proportionate value
for the Companies. In 1998, compensation of the Companies' executive officers
consisted primarily of base salary, which is reviewed by the Committees
annually, a potential award under Con Edison's Executive Incentive Plan, which
is shown in the Summary Compensation Table on page 12 under the caption "Bonus"
and a potential award under the 1996 Stock Option Plan (the "Stock Option
Plan"), which was approved by Con Edison's stockholders at the 1996 Annual
Meeting. In making its recommendations to the Boards, with respect to salaries
of officers other than Mr. McGrath, and awards under the Executive Incentive
Plan of officers other than Mr. McGrath, and in making awards under the Stock
Option Plan for officers other than Mr. McGrath, the Committees consider
recommendations made by Mr. McGrath. The Committees initiate the recommendations
that are made to the Boards with respect to Mr. McGrath's salary, any award
under the Executive Incentive Plan and any grants the Committees make to him
under the Stock Option Plan.

Individual performance is the primary factor considered in determining base
salary, within a range appropriate to that individual's position, although in
some cases corporate performance may also be relevant to base salary
determinations. Awards under the Executive Incentive Plan are based on both
individual and corporate performance. Grants under the Stock Option Plan are
based on individual performance and on an assessment of the individual's
responsibility for the success and growth of the Companies. Base salary ranges
are identified for the Companies' officers with reference to salaries paid by
other utilities and industry in general, as reflected in surveys by such
organizations as the Edison Electric Institute and in general industry studies
conducted by compensation consulting firms. These surveys are not identical to
the surveys referred to in the next paragraph. In addition, an attempt is made
to assure internal equity by maintaining appropriate salary relationships.
Increases for individuals are based on the current salary's relationship to the
range for the position (but not to any specific level within the range) and the
individual's performance with respect to the requirements of the individual's
position.

In considering the level of Mr. McGrath's compensation, the Committees
reviewed surveys of the total compensation, including base salary and incentive
compensation, paid to the chief executive officers of other utilities with
revenues exceeding $2 billion and a survey by the Edison Electric Institute of
the compensation paid to the chief executive officers in the electric utility
industry. The Committees do not target Mr. McGrath's compensation to any
specific level within the ranges of compensation paid by these comparison
companies but use the surveys as references. The utilities included in the
surveys referred to in this paragraph and the previous paragraph are some but
not all of the utilities included in the Standard & Poor's Electric Utilities
Index shown on the performance graph on page 18. None of the non-utility
companies in the surveys are in the Index.

The Committees believe that an evaluation of corporate performance must
take into account many factors affecting the Companies' operations, over some of
which management has total or considerable control and over others of which it
has little or no control. In this context they look not only to current reported
financial operating results and financial condition (as reflected in such
factors as earnings per share and return on common equity), but also to a wide
range of other information relating to the quality of service provided to
customers, the efficiency of operations, the

13
<PAGE> 18

development and management of personnel and the effectiveness of management's
efforts to strengthen the Companies for the future. In recommending the base
salaries or awards under the Executive Incentive Plan or grants under the Stock
Option Plan, the Committees do not have a predetermined list of criteria nor do
they have a formula for weighing or applying the criteria the Committee members
consider. The process is neither arithmetic nor formulaic, but judgmental.

1998 Base Salary Determinations -- In 1998 individual performance and
overall compensation ranges relevant to the Companies' officers were the factors
considered by the Executive Personnel and Pension Committees in determining the
base salaries recommended for such individuals.

1998 Executive Incentive Plan Awards -- Each year under the Executive
Incentive Plan, a maximum fund is established by the Committees, subject to the
approval of the Boards, based on the salaries of the eligible participants at
the end of the prior year. This maximum fund may not exceed one half of one
percent of the Companies' net income for the year. Awards may be made by the
Committees, subject to approval by the Boards, to eligible executives based on
their performance during the year. Payment of one-third of the award is deferred
for five years and is subject to forfeiture in certain circumstances. Portions
of awards that are required to be deferred are treated during the mandatory
deferral period as if the portions were invested in CEI's Common Stock and are
credited with dividend equivalents and credited or debited for increases or
decreases in the market value of an equivalent number of shares.

In recommending the amount awarded under the Executive Incentive Plan for
plan year 1998, the Committees considered the following financial factors for
1998: Earnings per share were higher than budgeted and nine cents higher than
1997; the stock price increased 29%, which compares with an increase of 26.7% in
the Standard & Poor's ("S&P") 500 stock index and a 10.2% increase for the S&P
Electric Index; total return on CEI's Common Stock was 34.6%; the rate of return
on shareholders' equity in 1998 was 12.0%; the dividend was increased by two
cents or 1%; interest coverage was 4.29 times compared with 4.09 for 1997 and
3.25 for the industry; Con Edison refinanced approximately $450 million of its
debt outstanding, resulting in annualized savings in interest charges of
approximately $4 million; the number of employees at year-end was 4.7% fewer
than at year-end 1997; operation and maintenance expenditures exceeded the
budget by $18.4 million; uncollectibles, as measured by net loss per $100
revenues, dropped from $0.44 in 1997 to $0.40 in 1998; electric sales increased
from 1997 by 2.5% on a weather-adjusted basis, while firm gas sales and firm
transportation decreased by 0.1% and steam sales decreased 1.7%, both on a
weather adjusted-basis.

The Committees also considered the following additional factors: CEI and
O&R agreed to a merger agreement; the implementation of the initial phase of Con
Edison's Retail Choice was a success; the New York State Public Service
Commission approved Con Edison's proposal to auction all of its in-city
fossil-fueled electric generating capacity and the auction was in process; Con
Edison succeeded in lowering its potential stranded cost disallowance by $115
million; as part of Con Edison's overall strategic plan for improving
efficiencies and reducing costs, eight of Con Edison's Customer Service Centers
were closed; Con Edison successfully met the 1998 electric peak load of 10,919
MW on July 22, 1998; the duration of customer electric outages was approximately
37% lower than in 1997; Con Edison continued to meet all regulatory commitments
required under the New York State Department of Environmental Conservation's
consent order; various actions have been taken by Con Edison addressing
environmental, health and safety ramifications associated with a fire in a
transformer at the Arthur Kill Generating Station; opacity events, chemical
spills, dielectric fluid leakage and transformer spills all decreased
substantially from 1997 levels; Con Edison completed the three-year probation
that was instituted following the steam accident near Gramercy Park; the total
number of OSHA recordable injuries declined substantially; Con Edison's minority
representation level in senior management increased from 10.9% in 1997 to 13.4%
in 1998, while female representation in upper management increased from 12.0% in
1997 to 14.5% in 1998 and overall minority representation increased from 31.0%
to 31.4%.

14
<PAGE> 19

Based on the Committees' review of the Companies' performance in 1998, as
reflected in the factors mentioned above, for 1998 the Committees recommended,
and the Boards approved, that the total amount awarded under the Executive
Incentive Plan to all participants as a group be 100 percent of the maximum
amount provided by the Plan.

CEO Compensation -- In making its recommendations to the Boards of
Directors and Trustees with respect to both the base salary and the Executive
Incentive Plan award for 1998 of Mr. McGrath and the Stock Option grant made to
him in 1998, the Committees considered among other things, the Companies' good
financial and operating results; the Companies' strong financial condition; the
Companies' progress in achieving the goal of environmental excellence; the
achievement of a merger agreement with O&R; the successful implementation of the
first phase of Con Edison's Retail Choice Program; the progress of CEI's
unregulated subsidiaries; and compensation levels of the chief executive
officers of the other companies included in the compensation surveys referred to
on page 13.

I.R.S. Limitations on Deductibility of Executive Compensation -- Federal
law restricts the deductibility, for federal income tax purposes, of certain
executive compensation above a specified threshold. In 1998, a portion of Mr.
McGrath's compensation exceeded the threshold. In the Committees' judgment, the
non-deductibility of the compensation is not material. The Committees intend to
take into account these tax law provisions in structuring the Companies'
executive compensation in future years.

The Executive Personnel and Pension
Committees

E. Virgil Conway (Chairman)
Sally Hernandez-Pinero
Robert G. Schwartz
Richard A. Voell

15
<PAGE> 20

STOCK OPTIONS

The purpose of the Stock Option Plan, which provides for granting options
to purchase shares of CEI's Common Stock ($.10 par value), is to promote the
interests of the Companies and their stockholders by providing long-term
incentives to those persons with significant responsibility for the success and
growth of the Companies by strengthening the Companies' ability to attract and
retain officers and other employees, and by aligning the interests of such
persons with those of the Companies' stockholders by facilitating their purchase
of an equity interest in CEI. All grants of stock options outstanding under the
1996 Stock Option Plan have a term of 10 years from date of grant and an
exercise price equal to 100 percent of fair market value on the date of grant.
The stock options are non-transferable and become exercisable three years after
the date of grant. In the event of a change in control of CEI, the Executive
Personnel and Pension Committee of CEI's Board may provide for appropriate
adjustments including (i) rescinding or taking any other action with respect to
any option to the extent necessary to permit CEI to engage in a merger,
consolidation or business combination intended to be accounted for as a pooling
of interests transaction or (ii) accelerating any exercisability or expiration
dates, and settlements of options either at the time the option is granted or at
a subsequent date.

OPTION GRANTS IN LAST FISCAL YEAR (1998)

<TABLE>
<CAPTION>
% OF TOTAL
OPTIONS
NUMBER OF GRANTED TO GRANT DATE
OPTIONS EMPLOYEES EXERCISE OR EXPIRATION PRESENT
NAME GRANTED IN 1998 BASE PRICE DATE VALUE(1)
- - ---- --------- ---------- ----------- ---------- ----------
<S> <C> <C> <C> <C> <C>
Eugene R. McGrath................... 70,000 7.9% $42.5625 2/23/08 $333,200
J. Michael Evans.................... 20,000 2.3% $42.5625 2/23/08 $ 95,200
Charles F. Soutar................... 20,000 2.3% $42.5625 2/23/08 $ 95,200
Joan S. Freilich.................... 20,000 2.3% $42.5625 2/23/08 $ 95,200
Stephen B. Bram..................... 16,000 1.8% $42.5625 2/23/08 $ 76,160
</TABLE>

- - ------------
(1) The grant date present values were calculated using the Black-Scholes
option pricing model applied as of the grant date, February 24, 1998. The values
generated by this model depend upon the following assumptions: an option
exercise date of February 23, 2006, a constant dividend yield on underlying
stock of 4.98 percent, an assumed annual volatility of the underlying stock of
12.68 percent; and a risk-free rate of return for the option period of 5.61
percent. The market value of the grant date is the closing price of the Common
Stock on the day preceding the grant date. No assumptions were made regarding
restrictions on vesting or the likelihood of vesting.

AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR (1998)
AND FISCAL YEAR-END OPTION VALUES (12/31/98)

<TABLE>
<CAPTION>
NUMBER OF VALUE OF UNEXERCISED
UNEXERCISED OPTIONS IN THE MONEY OPTIONS AT
SHARES AT FISCAL YEAR END FISCAL YEAR END(1)
ACQUIRED VALUE --------------------------- ---------------------------
ON EXERCISE REALIZED EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
----------- -------- ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
Eugene McGrath............... 0 0 0 210,000 0 $3,968,125
J. Michael Evans............. 0 0 0 60,000 0 $1,133,750
Charles F. Soutar............ 0 0 0 54,000 0 $ 991,000
Joan S. Freilich............. 0 0 0 54,000 0 $ 991,000
Stephen B. Bram.............. 0 0 0 48,000 0 $ 907,000
</TABLE>

- - ------------
(1) Represents the difference between the market price of CEI common stock
and the exercise price of the option at 12/31/98. The amounts may not be
realized. Actual values, if any, will be realized at the time of any exercise.

16
<PAGE> 21

PENSION PLANS

The following table shows, for the salary levels and years of service
indicated, the annual pension benefit payable commencing at age 65 under Con
Edison's Retirement Plan for Management Employees (the "Management Plan"), a
funded, tax-qualified, defined benefit pension plan, and Con Edison's
Supplemental Retirement Income Plan, an unfunded, non-qualified plan (together
referred to as the "Plans"), as supplemented in the case of Messrs. McGrath and
Evans by separate agreements.

PENSION PLAN TABLE

<TABLE>
<CAPTION>
FINAL
AVERAGE
SALARY YEARS OF SERVICE
------- --------------------------------------------------------------------------------
15 20 25 30 35 40 45
-- -- -- -- -- -- --
<S> <C> <C> <C> <C> <C> <C> <C>
$50,000.... $ 11,250 $ 15,000 $ 19,000 $ 24,000 $ 25,250 $ 26,500 $ 27,750
$100,000... $ 23,939 $ 31,918 $ 40,398 $ 50,877 $ 53,377 $ 55,877 $ 58,377
$200,000... $ 51,689 $ 68,918 $ 87,148 $109,377 $ 114,377 $ 119,377 $ 124,377
$300,000... $ 79,439 $105,918 $133,898 $167,877 $ 175,377 $ 182,877 $ 190,377
$400,000... $107,189 $142,918 $180,648 $226,377 $ 236,377 $ 246,377 $ 256,377
$500,000... $134,939 $179,918 $227,398 $284,877 $ 297,377 $ 309,877 $ 322,377
$600,000... $162,689 $216,918 $274,148 $343,377 $ 358,377 $ 373,377 $ 388,377
$700,000... $190,439 $253,918 $320,898 $401,877 $ 419,377 $ 436,877 $ 454,377
$800,000... $218,189 $290,918 $367,648 $460,377 $ 480,377 $ 500,377 $ 520,377
$900,000... $245,939 $327,918 $414,398 $518,877 $ 541,377 $ 563,877 $ 586,377
$1,000,000.. $273,689 $364,918 $461,148 $577,377 $ 602,377 $ 627,377 $ 652,377
$1,100,000.. $301,439 $401,918 $507,898 $635,877 $ 663,377 $ 690,877 $ 718,377
$1,200,000.. $329,189 $438,918 $554,648 $694,377 $ 724,377 $ 754,377 $ 784,377
$1,300,000.. $356,939 $475,918 $601,398 $752,877 $ 785,377 $ 817,877 $ 850,377
$1,400,000.. $384,689 $512,918 $648,148 $811,377 $ 846,377 $ 881,377 $ 916,377
$1,500,000.. $412,439 $549,918 $694,898 $869,877 $ 907,377 $ 944,877 $ 982,377
$1,600,000.. $440,189 $586,918 $741,648 $928,377 $ 968,377 $1,008,377 $1,048,377
$1,700,000.. $467,939 $623,918 $788,398 $986,877 $1,029,377 $1,071,877 $1,114,377
</TABLE>

The Plans provide pension benefits based on (i) the participant's highest
average salary for 60 consecutive months within the 120 consecutive months prior
to retirement ("final average salary"), (ii) the portion of final average salary
in excess of the Social Security taxable wage base in the year of retirement,
and (iii) the participant's length of service. For purposes of the Plans, a
participant's salary for a year is deemed to include any award under Con
Edison's Executive Incentive Plan (See "Report on Executive Compensation" above)
for that year; provided that the portions of awards that are required to be
deferred will not be included in the pension calculation if such portions are
forfeited in accordance with the plan. Participants in the Plans whose age and
years of service equal 75 are entitled to an annual pension benefit for life,
payable in equal monthly installments. Participants may earn increased pension
benefits by working additional years. Benefits payable to a participant who
retires between ages 55 and 59 with less than 30 years of service are subject to
a reduction of 1 1/2 percent for each full year of retirement before age 60.
Early retirement reduction factors are not applied to pensions of employees
electing retirement at age 55 or older with at least 30 years of service.
However, benefits payable on the portion of final average salary in excess of
the Social Security taxable wage base to a participant who retires before age 65
are subject to IRS reduction factors. The years of service covered by the Plans
are for Mr. McGrath, 36 years; Mr. Evans, 25 years, Mr. Soutar, 41 years, Mr.
Bram, 36 years and Ms. Freilich 21 years. Current compensation rates covered by
the Plans for Messrs. McGrath, Evans, Soutar, Bram and Ms. Freilich are
approximately equal to the sum of the amounts set forth under the captions

17
<PAGE> 22

"Salary" and "Bonus" in the summary compensation table on page 12. The Plans
provide an annual adjustment equal to the lesser of 3% or 3/4 of the annual
increase in the Consumer Price Index to offset partially the effects of
inflation.

Mr. McGrath's agreement provides that under certain circumstances, if he
elects upon termination of his employment to defer the commencement of his
pension as permitted by the Plans, Con Edison will accrue and later pay with
interest the amounts that Mr. McGrath would have been entitled to receive under
the Plans during the deferral period, as supplemented by his agreement.

PERFORMANCE GRAPH

The following performance graph compares Con Edison's cumulative total
stockholder return on its common stock for a five year period (December 31, 1993
to December 31, 1998) with the cumulative total return of the Standard & Poor's
Electric Utilities index and the Standard & Poor's 500 Stock index.

COMPARISON OF FIVE YEAR TOTAL CUMULATIVE RETURN*

CON EDISON, S&P ELECTRIC UTILITIES INDEX AND S&P 500 INDEX
DECEMBER 31, 1993 TO DECEMBER 31, 1998

<TABLE>
<CAPTION>
CON EDISON S&P ELECTRICS S&P 500
---------- ------------- -------
<S> <C> <C> <C>
'1993' 100.0 100.0 100.0
'1994' 86.4 86.9 101.3
'1995' 114.0 114.0 139.4
'1996' 112.2 113.8 171.4
'1997' 166.4 143.6 228.6
'1998' 223.9 165.9 293.9
</TABLE>

* Based on $100 invested at December 31, 1993; reinvestment of all dividends in
equivalent shares of stock; and market price changes on all such shares.

CERTAIN INFORMATION AS TO INSURANCE AND INDEMNIFICATION

No stockholder action is required with respect to the following information
which is included to fulfill the requirements of Sections 725 and 726 of the
Business Corporation Law of the State of New York.

18
<PAGE> 23

Effective December 2, 1998, Con Edison purchased insurance providing for
reimbursement, with certain exclusions and deductions, to (a) CEI or Con Edison
for payments it makes to indemnify directors, trustees, officers and assistant
officers of CEI and its subsidiaries (b) directors, trustees, officers and
assistant officers for losses, costs and expenses incurred by them in actions
brought against them in connection with their acts in those capacities for which
they are not indemnified by CEI or Con Edison and (c) CEI and its subsidiaries
for any payments they make resulting from a securities claim. The insurers are:
A.C.E. Insurance Company, Ltd., Continental Casualty Company, Executive Risk
Indemnity, Inc., Federal Insurance Company, Reliance Insurance Company, and
Zurich-American Insurance Company. The cost of this insurance was $667,500 for a
one year term. Con Edison also purchased from Federal Insurance Company, Royal
Insurance Company, Zurich-American Insurance Company additional insurance
coverage, for one year effective January 1, 1999, insuring the directors,
trustees, officers and employees of CEI and Con Edison and certain other parties
against certain liabilities which could arise in connection with the
administration of Con Edison's employee benefit plans. The cost of such coverage
was $200,000.

STOCKHOLDER PROPOSALS FOR 2000 ANNUAL MEETINGS

In order to be included in the joint proxy statement and form of proxy
relating to the Companies' 2000 Annual Meetings, stockholder proposals must be
received by the Companies at their principal offices at 4 Irving Place, New
York, New York 10003, Attention: Corporate Secretary, by December 7, 1999.

OTHER MATTERS TO COME BEFORE THE MEETINGS

Management intends to bring before the meetings only the election of
Directors/Trustees and Proposal No. 2 above and knows of no matters to come
before the meeting other than the matters set forth herein. If other matters or
motions come before the meetings, it is the intention of the persons named in
the accompanying form of proxy to vote such proxy in accordance with their
judgment on such matters or motions, including any matters dealing with the
conduct of the meetings. If a proposal offered by a stockholder that would
require each director to own at least 2,000 shares of Common Stock, which was
omitted from this proxy statement pursuant to applicable regulations, is
presented to the meeting, it is the intention of the persons named in the form
of proxy to vote against it.

PLEASE VOTE, SIGN AND DATE THE ENCLOSED PROXY CARD AND MAIL IT PROMPTLY IN
THE ENCLOSED POSTAGE PAID ENVELOPE, OR VOTE YOUR PROXY BY TELEPHONE IN
ACCORDANCE WITH THE INSTRUCTIONS SET FORTH ON THE PROXY CARD. YOUR VOTE IS
IMPORTANT. Stockholders planning to attend the meetings but choosing not to
return the proxy card should send a note requesting an admission ticket in the
envelope provided.

By Order of the Board of Directors and Trustees,

ARCHIE M. BANKSTON
Secretary
New York, N.Y.
April 5, 1999

19
<PAGE> 24

(LOGO)
printed on recycled paper
<PAGE> 25
<TABLE>
<CAPTION>
<S> <C>
[CON EDISON LOGO] Consolidated Edison Company of New York, Inc. VOTE BY TELEPHONE AND INTERNET
4 Irving Place, New York, N.Y. 10003 24 HOURS A DAY, 7 DAYS A WEEK

TELEPHONE INTERNET MAIL
800-650-4886 https://proxy.shareholder.com/edp

Use any touch-tone telephone to vote Use the Internet to vote your proxy. Have Mark, sign and date your proxy
your proxy. Have your proxy card in hand your proxy card in hand when you access the card and return it in the postage-
when you call. You will be prompted to website. You will be prompted to enter your paid envelope we have provided.
enter your control number, located in the control number, located in the box below, to
box below, and then follow the simple create an electronic ballot.
directions.

Your telephone or Internet vote authorizes the named If you have submitted your proxy by telephone or the Internet
proxies to vote your shares in the same manner as if there is no need for you to mail back your proxy.
you marked, signed, and returned the proxy card.

-----------------------------------------------

CALL TOLL-FREE TO VOTE * IT'S FAST AND CONVENIENT CONTROL NUMBER FOR TELEPHONE OR INTERNET VOTING
800-650-4886 ------------------------------------------------

DETACH PROXY CARD HERE IF YOU ARE NOT
VOTING BY TELEPHONE OR INTERNET
- - ----------------------------------------------------------------------------------------------------------------------------
</TABLE>

/ /

THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR THE FOLLOWING:
<S> <C> <C> <C>

(1) ELECTION OF FOR all nominees listed on the reverse side WITHHELD Authority to vote for *EXCEPTIONS
TRUSTEES (except as marked to the contrary below) / X / all nominees on the reverse side /X / / X /

(INSTRUCTIONS: TO WITHHOLD AUTHORITY TO VOTE FOR ANY INDIVIDUAL NOMINEE, MARK THE "EXCEPTIONS" BOX AND WRITE THAT NOMINEE'S NAME IN
THE SPACE PROVIDED BELOW.)

*Exceptions
-----------------------------------------------------------------------------------------------------------------------

FOR AGAINST ABSTAIN
(2) Ratification of appointment of independent accountants. / X / / X / / X /

Address Change and/or
Comments Mark Here / X /

If you plan to attend the
meeting and want an
admission ticket, check here. / /

Dated: 1999
-------------------------------------------,

------------------------------------------------------
SIGNATURE(S)

PLEASE SIGN, DATE AND RETURN THIS PROXY PROMPTLY. Votes MUST be indicated / X /
(x) in black or blue in.

PLEASE DETACH HERE
You Must Detach This Portion of the Proxy Card
Before Returning it in the Enclosed Envelope
</TABLE>
<PAGE> 26
<TABLE>
<CAPTION>

CONSOLIDATED EDISON COMPANY OF NEW YORK, INC. THIS PROXY IS SOLICITED ON BEHALF
$5 CUMULATIVE PREFERRED STOCK OF THE BOARD OF TRUSTEES
- - ------------------------------------------------------------------------------------------------------------------------------------
<S> <C>
PLEASE DATE AND The undersigned hereby appoints E. Virgil Conway, Peter W. Likins and Joan S. Freilich and each or
SIGN ON REVERSE any of them with power of substitution, proxies to vote all stock of the undersigned at the
SIDE. TO VOTE IN Annual Meeting of Stockholders on May 17, 1999 at The Theatre at Madison Square Garden,
ACCORDANCE WITH Seventh Avenue between 31st and 33rd Streets, New York, N.Y. or at any adjournments thereof, as
THE RECOMMENDA- specified on the reverse side in the election of Trustees and on the proposals more fully set forth in the
TIONS OF THE proxy statement, and in their discretion on any matters that may come before the meeting.
BOARD OF TRUSTEES
NO BOXES NEED BE Your vote for the election of Trustees may be indicated on the reverse side. Nominees are:
CHECKED. 01 - E.V. Conway, 02 - G.J. Davis, 03 - R.M. Davis, 04 - J.S. Freilich, 05 - E.V. Futter,
06 - S. Hernandez-Pinero, 07 - P.W. Likins, 08 - E.R. McGrath, 09 - R.G. Schwartz, 10 - R.A. Voell and
11 - S.R. Volk.

THIS PROXY WILL BE VOTED AS DIRECTED ON THE REVERSE SIDE, BUT IF NO CHOICE IS MADE, THIS PROXY WILL BE
VOTED "FOR" THE ELECTION OF THE NOMINEES FOR TRUSTEES LISTED ABOVE (PROPOSAL 1) AND "FOR" PROPOSAL 2;
AND "AGAINST" PROPOSALS 3 AND 4.

CON EDISON
P.O. BOX 11003
NEW YORK, N.Y. 10203-0003

[CON EDISON LOGO]
</TABLE>
<PAGE> 27
<TABLE>
<CAPTION>
<S> <C>
[CON EDISON LOGO] Consolidated Edison Inc. VOTE BY TELEPHONE AND INTERNET
4 Irving Place, New York, N.Y. 10003 24 HOURS A DAY, 7 DAYS A WEEK

TELEPHONE INTERNET MAIL
800-650-4644 https://proxy.shareholder.com/coned

-----------------------------------------------

CALL TOLL-FREE TO VOTE * IT'S FAST AND CONVENIENT CONTROL NUMBER FOR TELEPHONE OR INTERNET VOTING
800-650-4644 ------------------------------------------------

/ /

THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR THE FOLLOWING:
<S> <C> <C> <C>

(INSTRUCTIONS: TO WITHHOLD AUTHORITY TO VOTE FOR ANY INDIVIDUAL NOMINEE, MARK THE "EXCEPTIONS" BOX AND WRITE THAT NOMINEE'S NAME IN
THE SPACE PROVIDED BELOW.)

*Exceptions
-----------------------------------------------------------------------------------------------------------------------

FOR AGAINST ABSTAIN
(2) Ratification of appointment of independent accountants. / X / / X / / X /

THE BOARD OF DIRECTORS RECOMMENDS A VOTE AGAINST THE FOLLOWING STOCKHOLDER PROPOSALS (NOS. 3 AND 4)

(3) Cumulative voting. (4) Additional compensation information

FOR / X / AGAINST / X / ABASTAIN / X / FOR / X / AGAINST / X / ABASTAIN / X /

Address Change and/or
Comments Mark Here / X /

If you plan to attend the
meeting and want an
admission ticket, check here. / /

Dated: 1999
-------------------------------------------,

------------------------------------------------------
SIGNATURE(S)

PLEASE SIGN, DATE AND RETURN THIS PROXY PROMPTLY. Votes MUST be indicatred / X /
(x) in black or blue in.

PLEASE DETACH HERE
You Must Detach This Portion of the Proxy Card
Before Returning it in the Enclosed Envelope
</TABLE>
<PAGE> 28
<TABLE>
<CAPTION>

CONSOLIDATED EDISON INC. THIS PROXY IS SOLICITED ON BEHALF
COMMON STOCK OF THE BOARD OF TRUSTEES
- - ------------------------------------------------------------------------------------------------------------------------------------
<S> <C>
PLEASE DATE AND The undersigned hereby appoints E. Virgil Conway, Peter W. Likins and Joan S. Freilich and each or
SIGN ON REVERSE any of them with power of substitution, proxies to vote all stock of the undersigned (including any shares
SIDE. TO VOTE IN held through the Company's Automatic Dividend Reinvestment and Cash Payment Plan ) at at the Annual
ACCORDANCE WITH Meeting of Stockholders on Monday, May 17, 1999 at The Theatre at Madison Square Garden, Seventh Avenue
THE RECOMMENDA- between 31st and 33rd Streets, New York, N.Y. or at any adjournments thereof, as specified on the reverse
TIONS OF THE side in the election of Directors and on the proposals, all as more fully set forth in the proxy
BOARD OF DIRECTORS statement, and in their discretion on any matters that may come before the meeting.
NO BOXES NEED BE
CHECKED. Your vote for the election of Trustees may be indicated on the reverse side. Nominees are:
01 - E.V. Conway, 02 - G.J. Davis, 03 - R.M. Davis, 04 - J.S. Freilich, 05 - E.V. Futter,
06 - S. Hernandez-Pinero, 07 - P.W. Likins, 08 - E.R. McGrath, 09 - R.G. Schwartz, 10 R.A. Voell,
11 - S.R. Volk and 12 M.J. Del Giudice.

THIS PROXY WILL BE VOTED AS DIRECTED ON THE REVERSE SIDE, BUT IF NO CHOICE IS MADE, THIS PROXY WILL BE
VOTED "FOR" THE ELECTION OF THE NOMINEES FOR DIRECTORS LISTED ABOVE (PROPOSAL 1) AND "FOR" PROPOSAL 2;
ATRUSTEES ND "AGAINST" PROPOSALS 3 AND 4.

CON EDISON
P.O. BOX 11003
NEW YORK, N.Y. 10203-0003

[CON EDISON LOGO]
</TABLE>