SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 10-K

ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended December 31, 1997

Commission file number   0-25430     

               RIDGEWOOD ELECTRIC POWER TRUST IV               
(Exact Name of Registrant as Specified in Its Charter)

        Delaware                           22-3324608     
(State or Other Jurisdiction             (I.R.S. Employer Identification No.)
of Incorporation or Organization)

  c/o Ridgewood Power Corporation, 947 Linwood Avenue, Ridgewood, 
New Jersey 07450  
  (Address of Principal Executive Offices)                        (Zip Code)  

Registrant's Telephone Number, including Area Code:  (201) 447-9000

	Securities Registered Pursuant to Section 12(b) of the Act:  None
                

Securities Registered Pursuant to Section 12(g) of the Act:

Shares of Beneficial Interest
(Title of Class)

     Indicate by check mark whether the Registrant (1) has filed 
all reports required to be filed by Section 13 or 15(d) of the 
Securities Exchange Act of 1934 during the preceding 12 months 
(or for such shorter period that the Registrant was required to 
file such reports), and (2) has been subject to such filing 
requirements for the past 90 days.  Yes X  No ___

     Indicate by check mark if disclosure of delinquent filers 
pursuant to Item 405 of Regulation S-K is not contained herein, 
and will not be contained, to the best of Registrant's knowledge, 
in definitive proxy or information statements incorporated by 
reference in Part III of this Form 10-K or any amendment to this 
Form 10-K.[ X ]

     There is no market for the Shares.  The aggregate capital 
contributions made for the Registrant's voting Shares held by 
non-affiliates of the Registrant at March 21, 1998 was 
$47,680,000.

Exhibit Index is located on page 57.



<PAGE>

PART I

Item 1.  Business.
Forward-looking statement advisory

This Annual Report on Form 10-K, as with some other statements 
made by the Trust from time to time, has forward-looking 
statements.  These statements discuss business trends and other 
matters relating to the Trust's future results and the business 
climate and are found, among other places, at Items 1(c)(3), 
1(c)(4), 1(c)(6)(ii) and 7.  In order to make these statements, 
the Trust has had to make assumptions as to the future.  It has 
also had to make estimates in some cases about events that have 
already happened, and to rely on data that may be found to be 
inaccurate at a later time.  Because these forward-looking 
statements are based on assumptions, estimates and changeable 
data, and because any attempt to predict the future is subject to 
other errors, what happens to the Trust in the future may be 
materially different from the Trust's statements here.  

The Trust therefore warns readers of this document that they 
should not rely on these forward-looking statements without 
considering all of the things that could make them inaccurate.  
The Trust's other filings with the Securities and Exchange 
Commission and its Confidential Memorandum discuss many (but not 
all) of the risks and uncertainties that might affect these 
forward-looking statements.  

Some of these are changes in political and economic conditions, 
federal or state regulatory structures, government taxation, 
spending and budgetary policies, government mandates, demand for 
electricity and thermal energy, the ability of customers to pay 
for energy received, supplies of fuel and prices of fuels, 
operational status of plant, mechanical breakdowns, availability 
of labor and the willingness of electric utilities to perform 
existing power purchase agreements in good faith.  Some of these 
cautionary factors that readers should consider are described 
below at Item 1(c)(4) - Trends in the Electric Utility and 
Independent Power Industries.

By making these statements now, the Trust is not making any 
commitment to revise these forward-looking statements to reflect 
events that happen after the date of this document or to reflect 
unanticipated future events.
<PAGE>

(a)  General Development of Business.

     Ridgewood Electric Power Trust IV, the Registrant hereunder 
(the "Trust"), was organized as a Delaware business trust on 
September 8, 1994 to participate in the development, construction 
and operation of independent power generating facilities 
("Independent Power Projects" or "Projects").  Ridgewood Energy 
Holding Corporation ("Ridgewood Holding"), a Delaware 
corporation, is the Corporate Trustee of the Trust.

     The Trust sold whole and fractional shares of beneficial 
interest in the Trust ("Investor Shares") at $100,000 per 
Investor Share, and terminated its private placement offering on 
September 30, 1996.  It raised approximately $47,680,000.  Net of 
offering fees, commissions and expenses, the offering provided 
approximately $39,500,000 for investments in the development and 
acquisition of Independent Power Projects and operating expenses.  
The Trust has 943 holders of Investor Shares (the "Investors").  
As described below in Item 1(c)(2), the Trust has invested 
approximately $27.9 million of its funds to the acquisition of 
interests in four Independent Power Projects and in capital 
equipment and is actively seeking additional Projects for 
investment.

     Ridgewood Power Corporation (the "Managing Shareholder"), a 
Delaware corporation, is the Managing Shareholder of the Trust 
and as such has direct and exclusive discretion in the management 
and control of the affairs of the Trust (subject to the general 
supervision and review of the Independent Trustees and the 
Managing Shareholder acting together as the Board of the Trust).  
The Corporate Trustee acts on the instructions of the Managing 
Shareholder and is not authorized to take independent 
discretionary action on behalf of the Trust.  The Independent 
Trustees do not have any management or administrative powers over 
the Trust or its property other than as expressly authorized or 
required by the Declaration of Trust of the Trust (the 
"Declaration") or the Investment Company Act of 1940, as amended 
(the "1940 Act").  See Item 10 - Directors and Executive Officers 
of the Registrant below for a further description of the 
management of the Trust.

     The Trust made an election to be treated as a "business 
development company" under the Investment Company Act of 1940, as 
amended (the "1940 Act").  On January 24, 1995, the Trust 
notified the Securities and Exchange Commission of such election 
and registered the Investor Shares under the Securities Exchange 
Act of 1934, as amended (the "1934 Act").  On March 24, 1995 the 
election and registration became effective.  

     As described below at Item 1(c)(6)(iii) - Business - 
Narrative Description of Business - Regulatory Matters - the 1940 
Act, effective October 3, 1996, the Trust, with the approval of 
the Investors, withdrew its election to be a business development 
company so that it could make investments together with other 
programs sponsored by the Managing Shareholder without requesting 
exemptive relief from the Securities and Exchange Commission.  
The Trust covenanted to comply with most of the substantive 
restrictions on business development companies, other than 
certain transactions with affiliated persons, as described there.

     Unlike three prior investment programs that the Managing 
Shareholder has sponsored in the independent power industry, the 
Trust consolidates its subsidiaries' financial statements with 
its own for purposes of this Annual Report on Form 10-K.  

(b)  Financial Information about Industry Segments.

     The Trust has been organized to operate in only one industry 
segment:  independent power generation.

(c)  Narrative Description of Business.

(1)  General Description.

     The Trust was formed to participate in the development, 
construction and operation of independent electric power projects 
that generate electricity for sale to utilities and other users, 
and that might provide heat energy as well to users.  

     Historically, producers of electric power in the United 
States consisted of regulated utilities and of industrial users 
that produced electricity to satisfy their own needs.  The 
independent power industry in the United States was created by 
federal legislation passed in response to the energy crises of 
the 1970s.  The Public Utility Regulatory Policies Act of 1978, 
as amended ("PURPA"), requires utilities to purchase electric 
power from "Qualifying Facilities" (as defined in PURPA), 
including "cogeneration facilities" and "small power producers," 
and also exempts these Qualifying Facilities from most utility 
regulatory requirements.  Under PURPA, Projects that are 
Qualifying Facilities are generally not subject to federal 
regulation, including the Public Utility Holding Company Act of 
1935, as amended, and state regulation.  Furthermore, PURPA 
generally requires electric utilities to purchase electricity 
produced by Qualifying Facilities at the utility's avoided cost 
of producing electricity (i.e., the incremental costs the utility 
would otherwise face to generate electricity itself or purchase 
electricity from another source).  The Providence and Maine Hydro 
Projects are Qualifying Facilities.

(2)  The Trust's Investments.

(i)  Providence Project.  The Trust and Ridgewood Electric Power 
Trust III, a similar investment program sponsored by the Managing 
Shareholder ("Ridgewood Power III"), acquired in April 1996 all 
of the equity interest in the Providence State Landfill Power 
Plant, located near Providence, Rhode Island.  Ridgewood Power 
III invested $7.1 million in the Project and the Trust invested 
$12.9 million, which was the remainder of the $20 million 
investment in the Project.  The acquisition cost of the Project 
was approximately $15.5 million (including a $3 million partial 
prepayment of Project debt as a condition of obtaining the 
lenders' consents and transaction costs) and the remainder of the 
investment by the programs represents funds applied to operating 
reserves, working capital and cash reserves for capital 
improvements and expansion.  The Project is encumbered by $5.4 
million of debt maturing in installments through 2004.  In 1997, 
as described below, capital improvements were completed.

     The Project burns methane gas (the major component of 
natural gas) generated by the decomposition of garbage in the 
landfill as fuel for a 13.8 Megawatt capacity electric generation 
plant.  The facility has been in operation since 1990 and has a 
Power Contract for 12.0 Megawatts with New England Power Company 
with a 22 year term remaining.  

     The Project leases the right to use the landfill site from 
the Rhode Island Resource Recovery Corporation, a state agency, 
for a royalty of 15% of net Project revenues (increasing from 15% 
to 18% in 2006) until 2020.  The Project in turn subleases those 
rights to Central Gas Limited Partnership ("Gasco").  Gasco, 
which is not affiliated with the Trust, operates and maintains 
the piping system and other facilities to collect the methane gas 
from the landfill and supply it to the Project.  Gasco pays a 
fixed rent, computed on the basis of the Project's generating 
capacity, to the Project under the sublease, and the Project in 
turn buys its fuel from Gasco at a formula price per kilowatt-
hour generated by the Project.

     Since the Trust purchased the Project in April 1996, average 
output from the original eight engine-generator sets has risen by 
approximately 25% from 9.2 Megawatts in the first three months of 
1996 to 12.2 Megawatts in December 1996 and 11.5 Megawatts in 
1997.  Since August 1997, sales have approached the 12.0 Megawatt 
maximum under the Power Contract.  In order to increase output to 
the maximum and to allow engines to be rotated off-line for 
preventative maintenance, an additional engine and generator set 
were installed at the Project in spring 1997.  Although this 
increased nominal Project capacity by approximately 12%, the 
actual benefit is the ability to have one engine off-line at any 
time for maintenance and still produce the entire 12.0 Megawatts 
that can be sold under the existing Power Contract.  Net earnings 
from the Project (less the minority interest of Ridgewood Power 
III) for 1997 totalled $964,000, up from $562,000 for the period 
April 16-December 31, 1996.

(ii) California Pumping Project

     On December 31, 1995, the Trust purchased a package of 11 
irrigation service engines which have an aggregate power output 
equivalent to 1.2 Megawatts (the "California Pumping Project") 
located in Ventura County, California, for a cash purchase price 
of approximately $354,000.  The Trust purchased the Project from 
Ridgewood Power III for the same price paid by Ridgewood Power 
III for the assets to the unaffiliated seller.  In 1996, the 
Trust bought 9 additional engines with a rated equivalent 
capacity of 1.2 Megawatts from unaffiliated sellers at a price of 
$344,000.  The total investment in the Project at December 31, 
1997 was $648,000.

     The California Pumping Project has been operating since 1992 
and uses natural-gas-fired reciprocating engines to provide power 
for irrigation wells which furnish water for orchards of lemon 
and other citrus trees.  The power is purchased by local farmers 
and farmers' co-operatives at a price which represents a discount 
from the equivalent price the customers would have paid to 
purchase electric power.  The California Pumping Project will 
provide power equivalent to approximately 2.4 megawatts. 

     The Trust has entered into a management contract with the 
prior operator of the Project based on the amount of pumping 
power provided by each engine, computed on the basis of the 
equivalent amount of kilowatt-hours of electricity that would 
have been needed to provide that amount of pumping power. Until 
January 1998, the Trust received all cash flow from the engines 
up to $.02 per equivalent kilowatt-hour for the first 3,000 
kilowatt-hours per year, and $.01 per additional kilowatt-hour in 
that year.  The operator, which is responsible for all operating 
costs, received the remainder.  Beginning in January 1998, the 
Trust will receive one-half of revenues after deduction of a 6/10 
cent per equivalent kilowatt-hour maintenance fee and costs of 
fuel for the engines.  If net revenues are less than 1.5 cents 
per equivalent kilowatt-hour, the operator will receive 3/4 cent 
per equivalent kilowatt-hour (or all the net revenues if they are 
less than 3/4 cent) and the Trust will receive any remainder.

     Ridgewood Electric Power Trust II, a prior investment 
program sponsored by the Managing Shareholder ("Ridgewood Power 
II"), owns a package of similar engines located on different 
sites and operated under identical terms by the same operator.  
The engines operate independently of each other and revenues and 
expenses for each Trust are segregated from those of the other.

(iii) Maine Hydro Projects

     On December 23, 1996, the Trust purchased from Consolidated 
Hydro, Inc. a 50% interest in 14 small hydroelectric projects 
located in Maine. In order to increase diversification of the 
Trust's investments, the remaining 50% interest was purchased by 
Ridgewood Electric Power Trust V ("Ridgewood Power V"), a similar 
investment program organized in 1996 by the Managing Shareholder.  
Each Trust paid approximately $6,700,000 for its interest  The 
jointly owned partnership that acquired the Project also assumed 
a lease obligation in the amount of $1,005,000.  The partnership 
was credited with all income relating to the projects from July 
1, 1996 to the closing date and the seller was credited with 
interest on the purchase price at annual rates of 6% to 8.5% 
during that period.  

     The 14 hydroelectric projects have an aggregate rated 
capacity of 11.3 megawatts.  All electricity generated by the 
projects over and above their own requirements is sold to either 
Central Maine Power Company or Bangor Hydro Company under long-
term power purchase contracts.  Eleven of the contracts expire at 
the end of 2008 and the remaining three expire in 2007, 2014 and 
2017.  

     The Trust's net equity in the income of the Maine Hydro 
Projects for 1997 was $521,000.

     The Trusts have entered into a five year operating and 
maintenance agreement with Consolidated Hydro, Inc. under which a 
subsidiary of Consolidated Hydro will manage and administer the 
projects for a fixed annual fee of $307,500 (adjusted upwards for 
inflation), plus an annual incentive fee equal to 50% of the 
excess of aggregate net cash flow over a target amount of $1.875 
million per year.  The maximum incentive fee is $112,500 per 
year; to the extent the annual net cash flow exceeds $2.1 
million, the excess will be carried forward to future years; to 
the extent that the annual net cash flow is less than $1.875 
million, the deficit will be carried forward to future years.  In 
addition, the operator will be reimbursed for certain operating 
and maintenance expenses.  In 1997, the operator was paid a total 
of $429,000 for operating and incentive fees.

(iv) Maine Biomass Projects

     On July 1, 1997, the Trust and Ridgewood Power V purchased a 
preferred membership interest in Indeck Maine Energy, L.L.C., an 
Illinois limited liability company ("Indeck Maine") that owns two 
electric power generating stations fueled by waste wood at West
Enfield and at Jonesboro, Maine.  The Trust and Ridgewood Power V
purchased the interest through a limited liability company
owned equally by each.  The Trust's share of the purchase
price was $7,298,000 and Ridgewood Power V provided an equal 
amount of the total purchase price.

     The original members of Indeck Maine, who continue as equity
members subject to the preferred membership interest, are seven 
individuals.  In connection with the transaction, Indeck Maine 
distributed $9,143,000 of the purchase price to its original 
members.  The preferred membership interest entitles the Trust 
and Ridgewood Power V to receive all net cash flow from 
operations each year until they receive a 18% annual cumulative 
return on their capital contributions to Indeck Maine.  Any 
additional net  operating cash flow in that year is paid to the 
remaining Indeck Maine members until the total paid to them 
equals the amount of the 18% preferred return for that year, 
without cumulation.  Any remaining net operating cash flow for 
the year is payable 25% to the Trust and Ridgewood Power V 
together and 75% to the other Indeck Maine members unless the 
Trust and Ridgewood Power V recover their capital contributions 
from proceeds of a capital event.  Thereafter, these percentages 
change to 50% each.  All non-operating cash flow, such as 
proceeds of capital events, is divided equally between (a) the 
Trust and Ridgewood Power V and (b) the remaining Indeck Maine 
members.

     Under its amended operating agreement, the original Indeck 
Maine members designate a majority of the managers of Indeck 
Maine and thus have management control, although approval of the 
Trust and Ridgewood Power V jointly is required for many 
significant decisions.  If the Trust and Ridgewood Power V do not 
receive annual distributions at least equal to the 18% preferred 
return requirement or if Indeck Maine after a cure period fails 
to make distributions to them in accordance with the operating 
agreement, they have the right to designate a majority of the 
managers of Indeck Maine.  The other Indeck Maine members may 
regain control if Indeck  Maine satisfies the cumulative 
preferred return requirement within the next five calendar 
quarters.  Indeck Operations, Inc., an affiliate of the original 
Indeck Maine members, currently manages  the plant under a 
renewable agreement and is reimbursed for its costs.  In 
addition, the three managers nominated by the original Indeck 
Maine members will receive aggregate annual fees of $300,000 and 
certain other fees are payable to Indeck Maine affiliates.  The 
management agreement may be terminated on notice if the Trust and 
Ridgewood Power V obtain the right to designate a majority of the 
managers of Indeck Maine.  The Trust anticipates that it and 
Ridgewood Power V will have the right to do so and to terminate 
the management agreement at the end of 1998, at which time it 
anticipates that RPMC will assume management of the projects.  
Each of the projects has a 24.5 megawatt rated capacity and uses 
steam turbines to generate electricity.  The fuel is waste wood 
chips, bark, brush and similar biomass.  Both projects are 
Qualifying Facilities.  

     The Indeck Maine projects operated for five months in 1997 
selling electricity to participants in the New England Power Pool 
or to Bangor Hydroelectric Company on monthly contracts.  The 
contracts were not renewed in 1998 and the projects were shut 
down in January 1998.  Later in January 1998, during a severe ice 
storm, local officials requested an emergency restart of the 
projects.  A dispute ensued between Bangor Hydroelectric Company 
and the Indeck Maine projects, caused by the high costs of 
restarting the plants on an emergency basis.  Bangor 
Hydroelectric Company accused the projects of price-gouging in 
the emergency.  Indeck Maine responded that Bangor Hydroelectric 
was distorting the facts to divert attention from other matters 
and that it would sell the emergency energy at cost.  The matter 
is being informally reviewed by the Maine Attorney General's 
office, and no action has been taken to date.  The Trust does not 
anticipate any material adverse effect from the dispute.

     The cost to the owners of Indeck Maine for maintaining the 
facilities in operable condition and for fixed costs such as 
taxes and insurance is approximately $100,000 per month for both 
projects, which is being funded 25% by the Trust, 25% by 
Ridgewood Power V and 50% by the other Indeck Maine owners.

     Beginning in April 1998, ISO-New England, Inc. (the "ISO"), 
an independent, non-profit organization in which Indeck Maine and 
substantially all generators and distribution utilities in New 
England are members, began an auction process as part of the 
deregulation of the New England electricity market.  See (4) --
Trends in the Electric Utility and Independent Power Industries, 
for an explanation of the deregulatory process.  The first 
commodity to be auctioned is "installed capability," a 
measurement of the rated ability of a generating plant to create 
electric power.  Plants are credited with installed capability 
whether or not they run.  For an additional discussion of 
installed capability and other concepts related to electricity 
pricing, see (3) - Plant Operation, below.  Beginning April 1, 
1998 each distribution utility that is a member of the ISO must 
own or purchase installed capability on a monthly basis that at 
least equals its expected load for the month (the maximum amount 
of power that its customers may demand) plus mandated reserves.  
Generating facilities may enter into contracts to sell installed 
capability or may auction it through the ISO.  

     The Maine Biomass plants have sold installed capability for 
April 1998 under contract to a distribution utility and expect to 
sell installed capability for the rest of 1998 either through 
short or long-term contracts or the auction process.  Later in 1998 and 1999,
the ISO will add additional commodities to the auction process, such as 
operating capability (the amount of power that can be delivered by generating 
plants that are operating or can be placed in operation on short notice) and 
energy (the actual energy delivered by operating plants).  The Trust hopes 
that the prices for energy or operating capacity during the remainder of 
1998, either through the auction process or through short-term or long-term 
contracts, will be sufficient to allow the plants to be restarted and operate.

     The Trust believes that as utilities sell off generating 
assets, as state regulators require purchase of "renewable power" 
as described further at (4)(ii) - Trends in the Electric Utility 
and Independent Power Industries - Maine Biomass and "Merchant 
Power Plants" - Renewable Power and as the market in New England 
for generation becomes more competitive, the Maine Biomass 
ant 
Power Plants" - Renewable Power and as the market in New England 
for generation becomes more competitive, the Maine Biomass 
projects will be able to sell their future output profitably.  
However, there can be no assurance that they can do so 
consistently and earn a satisfactory return in the rapidly 
deregulating electricity industry.  See generally (4) - Trends in 
the Electric Utility and Independent Power Industries for further 
discussion of the opportunities and problems related to the 
deregulated industry.

     Neither Indeck Maine, its original members nor Indeck
Operations, Inc. is affiliated with or has any material
relationship with the Trust, Ridgewood Power V, their Managing
Shareholder or their affiliates, directors, officers or
associates of their directors and officers.  The sales price
and the terms of the acquisition were determined in arm's
length negotiations between the Managing Shareholder of the
Trust and representatives of the original Indeck Maine
members.  The source of the Trust's funds was proceeds of its
private placement offering of Investor Shares.

(v)  Proposed Investments.

     In January 1998 the Managing Shareholder executed a letter 
of intent under which the Trust and Ridgewood Power V would 
invest up to $32.3 million collectively in 17 small landfill-gas 
fueled generating plants being developed by NEO Corporation, a 
subsidiary of NRG Energy, Inc., of Minneapolis, Minnesota.  The 
plants are to be located at public landfills in California, 
Washington, New Jersey, New York, Massachusetts, Virginia and 
Florida and range in capacity from .9 Megawatt to 20 Megawatts.  
As currently contemplated, the Trust would invest up to $9 
million of its funds in a limited liability company and Ridgewood 
Power V would invest the remaining $23 million.  As projects were 
completed and received long-term debt financing from a bank 
financing source, the limited liability company would advance 
equity funds to the operating company and would receive a 
preferred right to distributions from the operating company and 
approximately a 50% interest on dissolution.  The funds invested 
by the limited liability company would come first from the 
Trust's contribution and then from Ridgewood Power V's 
contribution.  Unexpended funds would be returned to the Trust 
providing them.  At completion of the investment process 
(expected by November 1998) the Trust and Ridgewood Power V would 
have undivided interests in each plant in proportion to their net 
capital contributions to the limited liability company.

     The Trust is actively seeking additional Projects for 
investment, either by itself or in conjunction with other 
programs sponsored by the Managing Shareholder if such programs 
are authorized to do so. 

     If the Trust and another program with similar investment 
objectives have funds available at the same time for investment 
in the same or similar Projects, and a conflict of interest thus 
arises as to which program will make the investment, the Managing 
Shareholder will review the investment portfolio of each program.  
It will make the investment decision on the basis of such 
factors, among others, as the effects of the investment on the 
diversification of each program's portfolio, potential 
alternative investments, the effects investment by either program 
would have on the program's risk-return profile, the estimated 
tax effects of the investment on each program, the amount of 
funds available and the length of time those funds have been 
available for investment.  If more than one program has funds 
available for investment and the factors discussed above and 
other considerations indicate that the Project has approximately 
equal benefit for each Program, the Managing Shareholder will 
generally allocate the opportunity to each program in order of 
its organization date.  In that event, the Managing Shareholder 
will cause the oldest program to commit all of its reasonably 
available funds to that opportunity; if those funds are 
insufficient, the remainder of the opportunity will be offered to 
each successive program with reasonably available funds until the 
investment opportunity is exhausted.  A similar process would be 
followed for divestiture opportunities or competitive electricity 
sales.  

     An additional conflict could arise where the entities make 
investments in different forms, which would be the case where one 
entity's investment took the form of equity and the other's took 
the form of debt.  Although it anticipates that this situation is 
unlikely to arise, the Managing Shareholder, if practicable, 
would attempt to resolve any conflict of this type by reference 
to the terms negotiated by other debt or equity participants in 
the relevant Project or similar Projects.  Although the Managing 
Shareholder believes these practices may reduce potential 
conflicts of interest of this type, there can be no assurance 
that the interests of the entities will not diverge.  

(3)  Project Operation.

     The Providence and Maine Hydro Projects are Qualifying 
Facilities under PURPA and have entered into long-term power 
purchase agreements ("Power Contracts") with their local 
distribution utilities.  Under the Power Contracts for the 
Providence and Maine Hydro Projects, the local utilities are 
obligated to purchase the entire output of the Projects (up to 
rated levels)at formula prices.  No separate payments are made 
for capacity or capability and all payments under the Power 
Contracts are made for energy supplied. 

     The utility purchaser at the Providence Project, New England 
Power Company, pays 3.0 cents per kilowatt-hour for all power 
provided, adjusted for inflation based on changes in the consumer 
price index since 1989.  In addition to that base amount, it  
pays a flat additional 3.5 cents per kilowatt-hour for peak 
period power and 1.5 cents for non-peak power.  Additional 
adjustments are made to reduce payments in later years so as to 
levelize total amounts paid by the utility.

     The Maine Hydro Projects are licensed or operated as "run-
of-river" facilities, which means that the amount of water 
passing through the turbines is directly dependent upon the 
fluctuating level of flow of the river or stream.  The Projects 
have a very limited ability to store water during high flows for 
use at low flow periods.  As a result, these Projects are unable 
to earn capacity payments and are often unable to produce high 
output in the peak summer and winter months when spot electricity 
rates are highest.  Instead, they produce electric energy and 
sell it as generated at the fixed rates provided in the Power 
Contracts.  

     The Maine Biomass Projects do not have long-term Power 
Contracts and will be selling their output competitively. 

     The Trust's decisions to purchase Projects in New England 
have been driven in part by the relatively high prices paid for 
energy in the region and a shortage of generating capacity caused 
in large part by the forced shutdown of four large nuclear power 
plants owned by Northeast Utilities, Inc. and other utilities for 
regulatory and safety violations.  See the discussion at (4) - 
Trends in the Electric Utility and Independent Power Industries 
and (5) - Competition below for information regarding proposed 
capacity additions and cost factors that may offset that 
shortage.

     Customers of Projects that accounted for more than 10% of 
annual revenues from operating sources to the Trust in each of 
the last two fiscal years are:

<TABLE>

<CAPTION>
                                    Calendar year 
                                 1997          1996        

<S>                             <C>             <C>       
New England Electric System      90.0%           90.7% 
 (Providence Project)
</TABLE>

     The major costs of a Project while in operation will be debt 
service (if applicable), fuel, taxes, maintenance and operating 
labor.  The ability to reduce operating interruptions and to have 
a Project's capacity available at times of peak demand are 
critical to the profitability of a Project.  Accordingly, skilled 
management is a major factor in the Trust's business.  

     The Trust, through the Managing Shareholder, operates the 
Providence Project.  The Managing Shareholder has organized 
Ridgewood Power Management Corporation ("RPMC") to provide 
operating management for facilities operated by its investment 
programs.  See Item 10 - Directors and Executive Officers of the 
Registrant for further information regarding the Operation 
Agreement and RPMC.  The Maine Hydro Projects are managed by 
their former owner, Consolidated Hydro, Inc., which owns other 
hydroelectric facilities in the region, the California Pumping 
Project is managed by H&P, Inc., its former developer and the 
Maine Biomass Plants are currently managed by their former owner, 
Indeck Maine.

     Electricity produced by a Project is typically delivered to 
the purchaser through transmission lines which are built to 
interconnect with the utility's existing power grid, or in the 
case of the Maine Biomass Projects, via utility lines to the 
ISO's transmission facilities.

     The overall demand for electrical energy is somewhat 
seasonal, with demand usually peaking in the summertime as a 
result of the increased use of air conditioning.  As described 
above, peak periods in New England generally are limited to 
daytime and evening hours in the summer months (with a smaller 
peak in Maine for light and heating during the winter) and power 
prices are significantly higher during those periods.

     The technology involved in conventional power plant 
construction and operations as well as electric and heat energy 
transfers and sales is widely known throughout the world.  There 
are usually a variety of vendors seeking to supply the necessary 
equipment for any Project.  So far as the Trust is aware, there 
are no limitations or restrictions on the availability of any of 
the components which would be necessary to complete construction 
and commence operations of any Project.  Generally, working 
capital requirements are not a significant item in the 
independent power industry.  The cost of maintaining adequate 
supplies of fuel is usually the most significant factor in 
determining working capital needs.

     The Providence and Maine Hydro Projects owned by the Trust 
use landfill gas or hydroelectric energy and are not subject to 
fuel price changes or supply interruptions.  Because the Maine 
Hydro Projects are "run-of-river" hydroelectric plants, their 
output is dependent upon rainfall and snowfall in the areas above 
the dams and output has varied in the range of 30% over or 25% 
below the average output from 1987 through 1997.  Output is 
generally lowest in the summer  months and in the winter and 
highest in the spring and fall.

     The Maine Biomass Projects burn wood waste, including brush 
and chips from woodcutting or processing of raw wood at paper 
mills or sawmills.  The price of wood waste fluctuates and is a 
primary determinant of whether the Projects can run profitably or 
not.  The major causes of the fluctuation are changes in 
woodcutting or wood processing volumes caused by general economic 
conditions, increases in the use of wood waste by paper mills for 
their own cogeneration plants, changes in demand from competing 
generating plants using wood waste or paper mill refuse and 
weather conditions.  The cost of wood waste is currently 
significantly in excess of that anticipated at the time the Maine 
Biomass Projects were purchased.

     The California Pumping Project's engines burn natural gas.  
Hydrocarbon fuels, such as natural gas, coal and fuel oil, have 
been generally available in recent years for use by Independent 
Power Projects, although there have been serious supply 
impairments for both oil and natural gas at times during the last 
20 years.  Market prices for natural gas, oil and, to a lesser 
extent, coal have fluctuated significantly over the last few 
years.  Such fluctuations may directly inhibit the development of 
Projects because of the anticipated effects on Project 
profitability and may deter lenders to Projects or result in 
higher costs of financing.  

     In order to commence operations, most Projects require a 
variety of permits, including zoning and environmental permits.  
Inability to obtain such permits will likely mean that a Project 
will not be able to commence operations, and even if obtained, 
such permits must usually be kept in force in order for the 
Project to continue its operations.  

     Compliance with environmental laws is also a material factor 
in the independent power industry.  The Trust believes that 
capital expenditures for and other costs of environmental 
protection have not materially disadvantaged its activities 
relative to other competitors and will not do so in the future.  
Although the capital costs and other expenses of environmental 
protection may constitute a significant portion of the costs of a 
Project, the Trust believes that those costs as imposed by 
current laws and regulations have been and will continue to be 
largely incorporated into the prices of its investments and that 
it accordingly has adjusted its investment program so as to 
minimize material adverse effects.  If future environmental 
standards require that a Project spend increased amounts for 
compliance, such increased expenditures could have an adverse 
effect on the Trust to the extent it is a holder of such 
Project's equity securities.

     Of the 14 Maine Hydro Projects, six operate under existing 
hydroelectric project licenses from the Federal Energy Regulatory 
Commission ("FERC") and two have license applications pending.  
Changes to the six other, unlicensed Projects (which are 
currently exempt from licensing) may trigger a requirement for 
FERC licensing.  FERC licensing requirements have become 
progressively more stringent and often require that output of a 
Project that is being licensed or relicensed be restricted in 
order to allow a more natural flow of water, that archaeological 
and historical surveys be undertaken, that public access to 
waterways be provided (sometimes requiring purchase of property 
rights by the hydroelectric licensee) and that various site 
improvements be made.  These requirements can materially impair a 
project's profitability.  See Item 1(c)(6) - Business - Narrative 
Description of Business - Regulatory Matters.

(4) Trends in the Electric Utility and Independent Power 
Industries

	(i)  Qualifying Facilities with long-term Power Contracts

	The Trust is somewhat insulated from recent deregulatory 
trends in the electric industry because the Providence and Maine 
Hydro Projects are Qualifying Facilities with long-term formula-
price Power Contracts.  Each Power Contract now provides for 
rates in excess of current short-term rates for purchased power. 
There has been much speculation that in the course of 
deregulating the electric power industry, federal or state 
regulators or utilities would attempt to invalidate these power 
purchase contracts as a means of throwing some of the costs of 
deregulation on the owners of independent power plants.  

     To date, the Federal Energy Regulatory Commission and state 
authorities have ruled that existing Power Contracts will not be 
affected by their deregulation initiatives.  The regulators have 
so far rejected the requests of a few utilities to invalidate 
existing Power Contracts. Instead, most state plans for 
deregulation of the electric power industry (including those in 
Maine) treat the value of long-term Power Contracts that are 
above current and anticipated market prices as "stranded costs" 
of the utilities.  The utilities are to be allowed to recover 
those costs during a transition period.  This is typically done 
by imposing a transition fee or surcharge on rates that is paid 
to the utility. 

     No action has yet been taken by federal or state legislators 
to date to impair Independent Power Projects' existing power 
sales contracts, and there are federal constitutional provisions 
restricting actions to impair existing contracts.  There can not 
be any assurance, however, that the rapid changes occurring in 
the industry and the economy as a whole would not cause 
regulators or legislative bodies to attempt to change the 
regulatory structure in ways harmful to Independent Power 
Projects or to attempt to impair existing contracts.  In 
particular, some regulatory agencies have urged utilities to 
construe Power Contracts strictly and to police Independent Power 
Projects' compliance with those Power Contracts vigorously.  

     Predicting the consequences of any legislative or regulatory 
action is inherently speculative and the effects of any action 
proposed or effected in the future may harm or help the Trust.  
Because of the consistent position of the regulatory authorities 
to date and the other factors discussed here, the Trust believes 
that so long as it performs its obligations under the Power 
Contracts, it will be entitled to the benefits of the contracts.   

     In recent years, many electric utilities have attempted to 
exploit all possible means of terminating Power Contracts with 
independent power projects, including requests to regulatory 
agencies and alleging violations of even immaterial terms of the 
Power Contracts as justification for terminating those contracts. 
If such an attempt were to be made, the Trust might face material 
costs in contesting those utility actions.  Other utilities have 
from time to time made offers to purchase and terminate Power 
Contracts for lump sums. No such offer has been suggested or made 
to the Trust, although the Trust would entertain such an offer.

     Finally, the Power Contracts are subject to modification or 
rejection in the event that the utility purchaser enters 
bankruptcy.  There can be no assurance that the utility purchaser 
will stay out of bankruptcy.

     After the Power Contracts for the Providence and Maine Hydro 
Projects expire at varying times from 2008 to 2020 or those 
contracts terminate for other reasons, those Projects under 
currently anticipated conditions would be free to sell their 
output on the competitive electric supply market, either in spot, 
auction or short-term arrangements or under long-term contracts 
if those Power Contracts could be obtained.  There is no 
assurance that the Projects could then sell their output or do so 
profitably.  While the Providence Project is not subject to 
natural gas price fluctuations and it may benefit from 
environmental requirements for utilities to purchase power from 
environmentally favorable sources, the supply of fuel gas from 
the landfill is not assured.  Both it and the Maine Hydro 
Projects may have diseconomies of small scale.  The Trust is 
unable to anticipate whether the Projects would have cost 
disadvantages or advantages after their Power Contracts expire.  
It is thus impossible to predict the profitability of those 
Projects after termination of the Power Contracts.  

	(ii)  Maine Biomass and "Merchant Power Plants"

	The Maine Biomass Projects do not have long-term Power 
Contracts and are exposed to the newly-deregulating market for 
electricity generation.  Those Projects and other similar plants 
without long-term Power Contracts that the Trust may acquire are 
sometimes described as "merchant power plants" because they sell 
their output on the open market.  As a consequence of federal and 
state moves to deregulate large areas of the electric power 
industry and the existence, spurred by PURPA, of private 
competitors to electric utilities in the market for generating 
electricity, a number of interrelated trends are occurring that 
will affect merchant power plants. 

Continued Deregulation of the Generating Market

	The Comprehensive Energy Policy Act of 1992 (the "1992 
Energy Act") encourages electric utilities to expand their 
wholesale generating capacity by removing some, but not all, of 
the limitations on their ownership of new generating facilities 
that qualify as "exempt wholesale generators" ("EWG's") and on 
their ability to participate in merchant power plants.  Many 
state electric utility regulators are considering plans to 
further encourage investment in wholesale generators and to 
facilitate utility decisions to spin off or divest generating 
capacity from the transmission or distribution businesses of the 
utilities. As a result, merchant power plants in the future will 
face competition not only from other independent power plants 
seeking to sell electricity on a wholesale basis but also from 
EWG's, electric utilities with excess capacity and independent 
generators spun off or otherwise separated from their parent 
utilities. 

Wholesale-level Access to Transmission Capacity

	Without access to transmission capacity, an independent 
power plant or other wholesale generator can only sell to the 
local electric utility or to a facility on which it is located 
(or, in some states, which adjoins its location). The most 
important changes occurring in the electric power industry are 
the efforts of FERC to compel utilities and power pools to 
provide nationwide access to transmission facilities to all 
wholesale power generators. When combined with the increased 
competition in the generating area, this is likely to create an 
electricity supply market that may profoundly change the 
operations of electric utilities, consumers and independent power 
plants.

	The 1992 Energy Act empowered FERC to require electric 
utilities and power pools to transmit electric power generated by 
other wholesale generators to wholesale customers. This process 
is referred to as "wheeling" the electric power. Essentially, the 
generator contributes power to a utility or power pool and is 
credited with that contribution, and the utility or power pool 
serving the wholesale customer makes available that amount of 
electric power to the customer and debits the generator. Wheeling 
is effected between power pools on a similar basis. 

	On April 24, 1996 the Federal Energy Regulatory Commission 
adopted Order 888, which requires electric utilities and power 
pools to provide wholesale transmission facilities and 
information to all power producers on the same terms, and 
endorses the recovery by utilities of uneconomic capital costs 
from wholesale customers who change suppliers. The utilities 
would also be required to furnish ancillary services, such as 
scheduling, load dispatch, and system protection, as needed. 
These rights, however, would apply only to sales of new electric 
power over and above existing utility supply arrangements.  Non-
utility wholesale deliveries of electricity have grown vigorously 
and according to the federal government have grown at the rate of 
21% per year in the ten years from 1986 to 1996.

   	The Maine Biomass Projects are dependent on wheeling power 
in order to sell their capacity or energy to purchasers other 
than Bangor Hydroelectric Company.  Currently, they access the 
ISO's facilities through transmission lines owned by Bangor 
Hydroelectric Company and would pay material tariff charges for 
transmitting energy to the ISO's lines.  Indeck Maine and the 
Trust are pursuing regulatory and engineering measures to either 
have the Bangor Hydroelectric lines reclassified as ISO 
facilities (which would greatly reduce transmission costs) or to 
connect directly to ISO facilities.

	Order 888 takes no action to modify existing Power 
Contracts. The order intends to create a competitive national 
market in electricity generation and thus may create additional 
pressure on electric utilities to seek changes to long-term power 
purchase contracts, as described further below.  State public 
utility regulatory agencies must also review and approve certain 
aspects of wholesale power deregulation, and those agencies are 
currently holding proceedings and making determinations.
 
	In addition to the FERC order or other Congressional or 
regulatory actions that may result in freer access to 
transmission capacity, agreements with Canada, and to a lesser 
extent with Mexico, are leading toward access for those 
countries' generators to U.S. markets. In particular, certain 
Canadian suppliers, such as HydroQuebec (the Quebec provincial 
utility) are already offering substantial amounts of electricity 
in New England, and more may be offered if sufficient 
transmission capacity can be approved and built.  These 
agreements may also afford access to those countries' markets in 
the future for independent power plants. As a result, there is 
the possibility that a North American wholesale market will 
develop for electricity, with additional competitive pressures on 
U.S. generators.

Retail-level Competition

	An even more radical prospect for the electric power 
industry is retail-level competition, in which generators would 
be allowed to sell directly to customers by using (and paying a 
fee for) the local utility's distribution facilities. Retail-
level competition presupposes the ability to wheel power in the 
appropriate amounts at economic costs from the generating Project 
to the electric utility whose wires link to the retail customer 
(typically a large industrial, commercial or governmental unit) 
and the ability to use the local utility's facilities to deliver 
the electricity to the customer. In addition to the business and 
regulatory issues arising from wholesale wheeling, retail-level 
competition raises fundamental concerns as to the ability of 
utilities to recover stranded costs at the generating and 
distribution levels, the possibility that smaller customers will 
have less ability to demand pricing concessions, incentives for 
governmental agencies to act as intermediaries for consumers and 
the functions of state-level regulatory agencies in a price-
competitive environment which may be inconsistent with their 
traditional price-setting and service-prescribing roles. 

	Although retail deregulation is being implemented currently 
on a state-by-state basis, there are some common elements which 
are expected to be included in the Maine and Massachusetts 
deregulation plans.  First, most deregulating states will require 
that local utilities will be the "suppliers of last resort," 
which are required to serve any customers in their existing 
territories who do not purchase generated electricity from 
another source and which are required to obtain adequate 
generating capacity to meet those needs.  Second, most 
deregulating states are requiring that utilities and other 
suppliers of electricity work through "independent system 
operators" such as the ISO, which coordinate purchase, 
transmission and sale of electricity between generators and 
distribution utilities. Independent system operators will have 
significant responsibility for supply reliability. 

	Third, most deregulating states are requiring that utilities 
be compensated for stranded costs (which include long-term Power 
Contracts with Independent Power Projects that are above current 
and anticipated market prices) for a transition period. This is 
typically done by imposing a transition fee or surcharge on rates 
that is paid to the utility. In some states, utilities are being 
encouraged or ordered to issue bonds or other financial 
instruments to retire stranded cost assets or contracts, 
supported by transition charges.  Fourth, many states are 
requiring local utilities to divest a large portion or all of 
their generating assets or to sell their rights under long-term 
Power Contracts. The states have cited concerns such as the anti-
competitive effects of allowing the utilities, which retain a 
monopoly over the wires that take electricity the last stages to 
the customer, to own generating assets. Further, the sale of 
assets (or above-market Power Contracts) sets a market price for 
those assets and allows a somewhat objective computation of the 
stranded costs related to those assets or contracts. For example, 
the true stranded cost of a nuclear plant is approximately the 
difference between the value assigned to it under state 
regulation and the price someone will pay for it at auction. 

	Fifth, utilities having stranded costs are expected to 
mitigate those costs by buying out contracts or selling costly 
assets. Finally, many states are attempting to protect generators 
who use "renewable fuels" or that are considered to have 
environmental or social benefits.   As discussed below, Maine and 
Massachusetts are doing so.

Price and Cost Pressures

	The pricing pressures that retail and wholesale deregulation 
are bringing are expected to decrease the marginal cost of 
electricity.  Competition will force utilities and generators to 
reduce overhead and administrative costs, to trim operation and 
maintenance costs and to more efficiently buy and use fuel.  
Further, wholesale and retail deregulation and new generating 
technologies discussed below are expected to significantly reduce 
capital costs. For example, electric utilities currently maintain 
large amounts of generating capacity in reserve to meet peak 
loads (for example, to serve customers during a heat wave in 
July).  According to the federal government, competition may lead 
to pricing strategies that reduce these peak loads.  Competition 
may also force utilities to stop maintaining high-cost reserve 
capacity and to take greater risks.  Finally, the widening 
wholesale market for electricity may increase efficiency by 
allowing utilities and power consumers to obtain distant, lower-
cost capacity for reserve purposes rather than maintain local, 
higher cost, underutilized reserve capacity. For these and other 
reasons, the federal government currently estimates that national 
average electricity rates in real terms (adjusted for inflation) 
will decline to about 6.3 cents per kilowatt-hour in 2015 from 
the 1996 average level of 7.1 cents per kilowatt-hour. 

	As these trends continue, high-cost generators will be 
disadvantaged and may fail.  The Trust's small-scale generating 
plants have tended to have higher per-kilowatt hour costs (except 
for fuel) than new, large scale generating plants.  The fuel cost 
advantages, if any, of landfill gas, hydroelectricity or waste 
biomass are thus critical to the competitiveness of the Trust's 
merchant power plants.

New Generating Technologies and 
New Industry Participants 

	Recent improvements in turbine technology, coupled with what 
is seen as the ample supply and relative cheapness of natural 
gas, have made gas turbines the favored technology for new 
electric generating plants. The federal government estimates that 
80% of the new electric generating capacity to be added from 1995 
to 2015 will be fueled by natural gas and that the amount of 
generation fueled by natural gas will increase from the current 
10% to 29%. According to the federal government, new gas turbines 
only need 15 days per year of maintenance, on the average, 
compared with 30 days a year for steam turbines. Although gas 
turbines historically have been used to meet peak demand rather 
than baseload demand, new "combined cycle" units (which use heat 
from the turbine's exhaust to drive a second steam or gas 
turbine) have thermal efficiencies approaching 60% (60% of the 
theoretical maximum heat from the burning gas is converted to 
electricity) and can be used as baseload units. In contrast, 
steam turbines fired by coal have efficiencies in the 36% range 
and have operating and maintenance costs higher than those of 
combined cycle plants.  Further, natural gas-fired turbines emit 
relatively low levels of sulfur dioxide, particulates and complex 
carbon compounds and thus may have lower environmental compliance 
costs than coal-fired or oil-fired plants.  The federal 
government estimates that combined cycle gas turbine plants alone 
will account from 96,000 to 143,000 Megawatts of the 319,000 
Megawatts of additional capacity to be added in the next 17 
years. 

	The new emphasis on natural gas-fired generation is causing 
large natural gas transmission or brokering companies to enter 
the electricity generation market rapidly. They have access to 
large volumes of gas and have the ability to raise large amounts 
of capital. Accordingly, most new investment in combined cycle 
gas Projects and other large-scale gas turbine Projects is being 
made by these natural gas/energy companies or by large utilities 
that are entering the competitive generation industry. 

	A number of large participants in the independent generating 
industry have announced their intentions to build large gas 
turbine merchant power plants in Connecticut, Massachusetts and 
Maine in sizes from 250 to 750 Megawatts.  The capacity of the 
proposed plants exceeds one-half of the total deficit in capacity 
caused by the shutdown of the Northeast Utilities nuclear power 
plants.  If all or many of the announced plants were built, there 
might be a material increase in low-cost generation capacity in 
the New England area.  There have also been reports, especially 
from the northeastern states, that large non-utility generating 
companies and utilities entering the competitive generating 
market outside their existing service territories are buying 
large numbers of older plants from local utilities with the 
intention of replacing them on site with new, large, natural gas-
fueled plants. It is unclear whether many of the announced 
merchant power plants will actually be built, given the 
uncertainties of the market for electricity and the possibility 
that there may be insufficient gas pipeline capacity or supplies 
to fuel all of the recently announced plants.  

	Many companies, including affiliates of fuel suppliers and 
utilities, have applied to FERC to act as electric power 
marketers, because they anticipate that if wholesale wheeling 
becomes significant there will be strong demand for brokers or 
market makers in electric power. It is uncertain whether power 
marketers will become significant factors in the electric power 
market. A related development is the creation of derivative 
contracts for hedging of and speculation in electricity supplies, 
which may offer generators, utilities and large industrial or 
commercial consumers the ability to reduce the volatility of 
competitive prices. To date, the effects of derivative contracts 
on the market for electricity in the Northeast have not been 
material.

Renewable Power

	The pressures of competition are expected to harm the 
"renewable power" segment of the industry, which includes the 
Maine Biomass Projects. "Renewable power" is a catchphrase that 
includes Projects (such as solar, wind, small hydroelectric, 
biomass, geothermal and landfill-gas) that do not use fossil 
fuels or nuclear fuels.  Renewable power plants typically have 
high capital costs and often have total costs that are well above 
current total costs for new gas-turbine production. Many 
observers believe that renewable power plants without existing 
Power Contracts (with the possible exception of biomass, 
hydroelectric and geothermal plants with very low or zero fuel 
costs) will be non-competitive in the new markets unless they are 
given governmental protection. A number of states, including 
Massachusetts and Maine, are requiring that retailers of 
electricity purchase a certain minimum amount of electricity 
(often between 5% to 30% of their total requirements) from 
renewable power sources.  Unless there is a shortage of renewable 
capacity these state requirements may still not raise the price 
for renewable power high enough to make those Projects 
profitable. 

Initial Effects of Trends

	With these conditions in mind, many observers see two 
primary strategies for non-utility generating plants to succeed 
in the United States: first, Projects that have existing, firm, 
long-term Power Contracts may do well so long as regulatory or 
legislative actions do not abrogate the contracts. Second, 
Projects that are low-cost producers of electricity, either from 
efficiencies or good management or as the result of successful 
cogeneration technologies, will have advantages in the market. 

	Finally, there have been industry-wide moves toward 
consolidation of participants and divestiture of Projects. A 
number of utilities and equipment suppliers have proposed or 
entered into joint ventures to reduce risks and mobilize 
additional capital for the more competitive environment, while 
many electric utilities are in the process of combining, either 
as a means of reducing costs and capturing efficiencies, or as a 
means of increasing size as an organizational survival tactic. 
This consolidation tends to create additional competitive 
pressures in the electric power industry; however, this trend may 
also encourage the divestiture of smaller Projects or Projects 
that are deemed less central to the operations of large, 
consolidated businesses. 


(5).  Competition

     There are a large number of participants in the independent 
power industry.  Several large corporations specialize in 
developing, building and operating independent power plants.  
Equipment manufacturers, including many of the largest 
corporations in the world, provide equipment and planning 
services and provide capital through finance affiliates.  Many 
regulated utilities are preparing for a competitive market, and a 
significant number of them already have organized subsidiaries or 
affiliates to participate in unregulated activities such as 
planning, development, construction and operating services or in 
owning exempt wholesale generators or up to 50% of independent 
power plants.  In addition, there are many smaller firms whose 
businesses are conducted primarily on a regional or local basis.  
Many of these companies focus on limited segments of the 
cogeneration and independent power industry and do not provide a 
wide range of products and services.  There is significant 
competition among non-utility producers, subsidiaries of 
utilities and utilities themselves in developing and operating 
energy-producing projects and in marketing the power produced by 
such projects.

     The Trust is unable to accurately estimate the number of 
competitors but believes that there are many competitors at all 
levels and in all sectors of the industry.  Many of those 
competitors, especially affiliates of utilities and equipment 
manufacturers, may be far better capitalized than the Trust.

     Please also review the discussion of changes in the industry 
above at (4) - Trends in the Electric Utility and Independent 
Power Industries.

(6).  Regulatory Matters.

     Projects are subject to energy and environmental laws and 
regulations at the federal, state and local levels in connection 
with development, ownership, operation, geographical location, 
zoning and land use of a Project and emissions and other 
substances produced by a Project.  These energy and environmental 
laws and regulations generally require that a wide variety of 
permits and other approvals be obtained before the commencement 
of construction or operation of an energy-producing facility and 
that the facility then operate in compliance with such permits 
and approvals.  Since the Trust has agreed to comply with most of the 
requirements for "business development companies" under the 1940 Act, it also
is contractually bound to comply with the requirements summarized below 
and others described at Exhibit 99 to this Annual Report on Form 10-K.

(i)  Energy Regulation.

(A)  PURPA.  The enactment in 1978 of PURPA and the adoption of 
regulations thereunder by FERC provided incentives for the 
development of cogeneration facilities and small power production 
facilities meeting certain criteria.  Qualifying Facilities under 
PURPA are generally exempt from the provisions of the Public 
Utility Holding Company Act of 1935, as amended (the "Holding 
Company Act"), the Federal Power Act, as amended (the "FPA"), 
and, except under certain limited circumstances, state laws 
regarding rate or financial regulation.  In order to be a 
Qualifying Facility, a cogeneration facility must (a) produce not 
only electricity but also a certain quantity of heat energy (such 
as steam) which is used for a purpose other than power 
generation, (b) meet certain energy efficiency standards when 
natural gas or oil is used as a fuel source and (c) not be 
controlled or more than 50% owned by an electric utility or 
electric utility holding company.  Other types of Independent 
Power Projects, known as "small power production facilities," can 
be Qualifying Facilities if they meet regulations respecting 
maximum size (in certain cases), primary energy source and 
utility ownership.  Recent federal legislation has eliminated the 
maximum size requirement for solar, wind, waste and geothermal 
small power production facilities (but not for hydroelectric or 
biomass) for a fixed period of time.

     In addition, PURPA requires electric utilities to purchase 
electricity generated by Qualifying Facilities at a price equal 
to the purchasing utility's full "avoided cost" and to sell back 
up power to Qualifying Facilities on a non discriminatory basis. 
Avoided costs are defined by PURPA as the "incremental costs to 
the electric utility of electric energy or capacity or both 
which, but for the purchase from the Qualifying Facility or 
Qualifying Facilities, such utility would generate itself or 
purchase from another source."  While public utilities are not 
required by PURPA to enter into long-term Power Contracts to meet 
their obligations to purchase from Qualifying Facilities, PURPA 
helped to create a regulatory environment in which it has become 
more common for such contracts to be negotiated until recent 
years.

     The exemptions from extensive federal and state regulation 
afforded by PURPA to Qualifying Facilities are important to the 
Trust and its competitors.  The Trust believes that the 
Providence and Maine Hydro Projects, which sells electricity to 
public utilities, are Qualifying Facilities.  Maintaining the 
Qualified Facility status of an electric generating Project is of 
utmost importance to the Trust.  Such status may be lost if a 
Project does not meet the operational or ownership requirements 
of PURPA.  For small power production facilities such as the 
Providence and Maine Hydro Projects, the requirements are limited 
to maximum size, fuel use and ownership requirements that are 
currently unlikely to be violated.  Cogeneration Projects that 
are Qualifying Facilities have more stringent requirements, such 
as minimum operating efficiency standards and minimum use of 
thermal energy by customers of a cogeneration Project.  

     The Trust endeavors to comply with applicable PURPA 
requirements and does not believe that either the Providence or 
Maine Hydro Projects are subject to any requirement that could 
jeopardize their statuses as Qualified Facilities.  If the Trust 
were to invest in cogeneration Projects or certain other types of 
Qualifying Facilities, the PURPA standards could raise material 
compliance questions.  In any event, there can be no assurance 
that a Project will maintain its Qualified Facility status.  If a 
Project loses its Qualifying Facility status, the utility can 
reclaim payments it made for the Project's non-qualifying output 
to the extent those payments are in excess of current avoided 
costs (which are generally substantially below the Power Contract 
rates) or the Project's Power Contract can be terminated by the 
electric utility.  States may require utilities to institute 
monitoring systems under which electric utilities continuously 
meter a cogeneration Project's performance. 

(B)  The 1992 Energy Act.  The Comprehensive Energy Policy Act of 
1992 (the "1992 Energy Act") empowered FERC to require electric 
utilities to make available their transmission facilities to and 
wheel power for Independent Power Projects under certain 
conditions and created an exemption for electric utilities, 
electric utility holding companies and other independent power 
producers from certain restrictions imposed by the Holding 
Company Act.  Although the Trust believes that the exemptive 
provisions of the 1992 Energy Act will not materially and 
adversely affect its business plan, the act may result in 
increased competition in the sale of electricity.

     The 1992 Energy Act created the "exempt wholesale generator" 
category for entities certified by FERC as being exclusively 
engaged in owning and operating electric generation facilities 
producing electricity for resale.  Exempt wholesale generators 
remain subject to FERC regulation in all areas, including rates, 
as well as state utility regulation, but electric utilities that 
otherwise would be precluded by the Holding Company Act from 
owning interests in exempt wholesale generators may do so. Exempt 
wholesale generators, however, may not sell electricity to 
affiliated electric utilities without express state approval that 
addresses issues of fairness to consumers and utilities and of 
reliability.

(C)  The Federal Power Act.  The FPA grants FERC exclusive rate-
making jurisdiction over wholesale sales of electricity in 
interstate commerce.  The FPA provides FERC with ongoing as well 
as initial jurisdiction, enabling FERC to revoke or modify 
previously approved rates.  Such rates may be based on a cost-of-
service approach or determined through competitive bidding or 
negotiation.  While Qualifying Facilities under PURPA are exempt 
from the rate-making and certain other provisions of the FPA, 
non-Qualifying Facilities are subject to the FPA and to FERC 
rate-making jurisdiction.  

     Companies whose facilities are subject to regulation by FERC 
under the FPA because they do not meet the requirements of PURPA 
may be limited in negotiations with power purchasers.  However, 
since such projects would not be bound by PURPA's heat energy use 
requirement for cogeneration facilities, they may have greater 
latitude in site selection and facility size.  If any of the 
Trust's electric power Projects failed to be a Qualifying 
Facility, it would have to comply with the FPA.

     The FPA also provides that any hydroelectric facility that 
is located on a navigable stream or that affects public lands or 
water from a government dam may not be constructed or be operated 
without a license from FERC.  Certain facilities that were 
operating before 1935 are exempt, if the waterway is non-
navigable, or "grandfathered" and do not require licenses so long 
as the facilities are not modernized or otherwise materially 
altered.  Licenses are granted for 30 to 50 year terms.  All but 
two of the Maine Hydro Projects (with a rated capacity of 2.1 
Megawatts) are subject to licensing.  Of these 12 Projects, six 
(with a rated capacity of 6.4 Megawatts) have current licenses 
that expire from time to time between the years 2019 and 2037 and 
two (1.5 Megawatts) are currently in the licensing process, which 
can take from three to five years.  The Trust believes that it 
will obtain licenses for each of these.  

     The proposed conditions for one pending license, at the 
Pittsfield Project on the Kennebec River (1.1 Megawatt), have 
been received.  The Project will have to provide upstream fish 
passages no earlier than 2002 or, if later, the time when all 
dams further upstream have provided passage.  The Project will 
also have to provide interim fish passage both upstream and 
downstream to the extent warranted by fishery studies; downstream 
mitigation measures may require the Project to restrict flow 
through its turbines during certain spring peak flow periods that 
could materially impair electricity output.  Until studies are 
complete, it is not possible to estimate the effects of these 
conditions.  Further, as noted above at Item 1(c)(3) - Business - 
Narrative Description of Business - Project Operation, the 
licenses may include other onerous conditions.  The Trust is a 
member of the Kennebec Hydro Developers Group, which is 
negotiating with Maine agencies and environmental groups for 
watershed-wide studies and remediation programs.

     Finally, six of the Maine Hydro Projects (with a rated 
capacity of 3.7 Megawatts) are exempt, grandfathered or are not 
otherwise subject to FERC licensing.

(D)  Fuel Use Act.  Projects that may be developed or acquired 
may also be subject to the Fuel Use Act, which limits the ability 
of power producers to burn natural gas in new generation 
facilities unless such facilities are also coal-capable within 
the meaning of the Fuel Use Act.  

(E)  State Regulation.  State public utility regulatory 
commissions have broad jurisdiction over Independent Power 
Projects which are not Qualifying Facilities under PURPA, and 
which are considered public utilities in many states.  In states 
where the wholesale or retail electricity market remains 
regulated, Projects that are not Qualifying Facilities may be 
subject to state requirements to obtain certificates of public 
convenience and necessity to construct a facility and could have 
their organizational, accounting, financial and other corporate 
matters regulated on an ongoing basis.  Although FERC generally 
has exclusive jurisdiction over the rates charged by a non-
Qualifying Facility to its wholesale customers, state public 
utility regulatory commissions have the practical ability to 
influence the establishment of such rates by asserting 
jurisdiction over the purchasing utility's ability to pass 
through the resulting cost of purchased power to its retail 
customers.  In addition, states may assert jurisdiction over the 
siting and construction of non-Qualifying Facilities and, among 
other things, issuance of securities, related party transactions 
and sale and transfer of assets.  The actual scope of 
jurisdiction over non-Qualifying Facilities by state public 
utility regulatory commissions varies from state to state.

(ii)  Environmental Regulation.

     The construction and operation of Independent Power Projects 
and the exploitation of natural resource properties are subject 
to extensive federal, state and local laws and regulations 
adopted for the protection of human health and the environment 
and to regulate land use.  The laws and regulations applicable to 
the Trust and Projects in which it invests primarily involve the 
discharge of emissions into the water and air and the disposal of 
waste, but can also include wetlands preservation and noise 
regulation.  These laws and regulations in many cases require a 
lengthy and complex process of renewing licenses, permits and 
approvals from federal, state and local agencies.  Obtaining 
necessary approvals regarding the discharge of emissions into the 
air is critical to the development of a Project and can be time-
consuming and difficult.  Each Project requires technology and 
facilities which comply with federal, state and local 
requirements, which sometimes result in extensive negotiations 
with regulatory agencies.  Meeting the requirements of each 
jurisdiction with authority over a Project may require extensive 
modifications to existing Projects.

     The Clean Air Act Amendments of 1990 contain provisions 
which regulate the amount of sulfur dioxide and oxides of 
nitrogen which may be emitted by a Project.  These emissions may 
be a cause of "acid rain."  Qualifying Facilities are currently 
exempt from the acid rain control program of the Clean Air Act 
Amendments.  However, non-Qualifying Facility Projects will 
require "allowances" to emit sulfur dioxide after the year 2000. 
Under the Amendments, these allowances may be purchased from 
utility companies then emitting sulfur dioxide or from the 
Environmental Protection Agency ("EPA").  Further, an Independent 
Power Project subject to the requirements has a priority over 
utilities in obtaining allowances directly from the EPA if (a) it 
is a new facility or unit used to generate electricity; (b) 80% 
or more of its output is sold at wholesale; (c) it does not 
generate electricity sold to affiliates (as determined under the 
Holding Company Act) of the owner or operator (unless the 
affiliate cannot provide allowances in certain cases) and (d) it 
is non-recourse project-financed.  The market price of an 
allowance cannot be predicted with certainty at this time.  In 
recent years, supply of allowances has tended to exceed demand, 
primarily because of improved control technologies and the 
increased use of natural gas.

     Title V of the Clean Air Act Amendments added a new 
permitting requirement for existing sources that requires all 
significant sources of air pollution to submit new applications 
to state agencies.  Title V implementation by the states 
generally does not impose significant additional restrictions on 
the Trust's Projects, other than requirements to continually 
monitor certain emissions and document compliance.  The 
permitting process is voluminous and protracted and the costs of 
fees for Title V applications, of testing and of engineering 
firms to prepare the necessary documentation have increased.  The 
Trust believes that all of its facilities will be in compliance 
with Title V requirements with only minor modifications such as 
the installation of an additional catalytic converter on some 
engines.

     In July 1997 the Environmental Protection Agency adopted 
more stringent standards for levels of ozone and small 
particulate matter (particles less than 25 microns in diameter) 
in geographic areas.  These new standards may cause some areas in 
which Projects are located to be classified as non-attainment 
areas.  If so, states will be required to impose additional 
requirements for industries to reduce emissions.  It is uncertain 
whether or how any reductions would be applied to small 
facilities such as the Trust's Projects.  If reductions were 
required, the Trust might have to make significant capital 
investments to install new control technology or might have to 
reduce operations.  In addition, many eastern states, including 
Maine, have organized in the Ozone Transport Assessment Group to 
require further restrictions on emissions of nitrogen oxides.  
The Environmental Protection Agency is considering the Group's 
recommendations as well as other proposals to reduce emissions of 
nitrogen oxides and other ozone-forming chemicals.  If adopted, 
new regulations could required the Trust to install additional 
equipment to reduce those emissions or to change operations.  
Nitrogen oxide reductions can be difficult to achieve with add-on 
equipment and often require decreases in operating efficiency, 
both of which could cause material cost to the Trust.  It is not 
possible at this time to estimate whether or not any potential 
regulatory changes would materially affect the Trust.

     The Clean Air Act Amendments empower states to impose annual 
operating permit fees of at least $25 per ton of regulated 
pollutants emitted up to $100,000 per pollutant.  To date, no 
state in which the Trust operates has done so.  If a state were 
to do so, such fees might have a material effect on the Trust's 
costs of generation, in light of the relatively small size of the 
Trust's facilities as opposed to large utility generation plants 
that might benefit from the cap on fees.

     The Trust's Projects must comply with many federal and state 
laws and regulations governing wastewater and stormwater 
discharges from the Projects.  These are generally enforced by 
states under "NPDES" permits for point sources of discharges and 
by stormwater permits.  Under the Clean Water Act, NPDES permits 
must be renewed every five years and permit limits can be reduced 
at that time or under re-opener clauses at any time.  The 
Projects have not had material difficulty in complying with their 
permits or obtaining renewals.  The Projects use closed-loop 
engine cooling systems which do not require large discharges of 
coolant except for periodic flushing to local sewer systems under 
permit and do not make other material discharges. 

     In 1998, the Trust's Projects will become subject to the 
reporting requirements of the Emergency Planning and Community 
Right-to-Know Act that require the Projects to prepare toxic 
release inventory release forms.  These forms will list all toxic 
substances on site that are used in excess of threshold levels so 
as to allow governmental agencies and the public to learn about 
the presence of those substances and to assess potential hazards 
and hazard responses.  The Trust does not anticipate that this 
will result in any material adverse effect on it.  

     Based on current trends, the Managing Shareholder expects 
that environmental and land use regulation will become more 
stringent.  The Trust and the Managing Shareholder have developed 
limited expertise and experience in obtaining necessary licenses, 
permits and approvals, which in the case of the Maine Hydro 
Project are the responsibility of Consolidated Hydro, Inc. andin 
the case of the Maine Biomass Projects are the responsibility of 
Indeck Operations, Inc.  The Trust will rely upon qualified 
environmental consultants and environmental counsel retained by 
it or by Project Sponsors to assist in evaluating the status of 
Projects regarding such matters.

 (iii)  The 1940 Act

     Since its Shares are registered under the 1934 Act, the 
Trust is required to file with the Commission certain periodic 
reports (such as Forms 10-K (annual report), 10-Q (quarterly 
report) and 8-K (current reports of significant events) and to be 
subject to the proxy rules and other regulatory requirements of 
that act that are applicable to the Trust.  The Trust has no 
intention to and will not permit the creation of any form of a 
trading market in the Shares in connection with this 
registration.

     On January 24, 1995, the Trust notified the Securities and 
Exchange Commission (the "Commission") of its election to be a 
"business development company" and registered its Shares under 
the 1934 Act.  On March 24, 1995, the election and registration 
became effective.  As a "business development company," the Trust 
was subject to prohibitions and restrictions on transactions 
between business development companies and their affiliates as 
defined in that act, and required that a majority of the board of 
the company be persons other than "interested persons" as defined 
in the act.

     In particular, Commission approval was required for certain 
transactions involving certain closely affiliated persons of 
business development companies, including many transactions with 
the Managing Shareholder and the other investment programs 
sponsored by the Managing Shareholder.  The decision to co-invest 
in the Providence Project with Ridgewood Power III required 
approval of the Commission, which took more than eight months to 
obtain.  The decision to co-invest in the Maine Hydro Projects 
with Ridgewood Power V would also have required approval of the 
Commission.  There was no assurance that the necessary approval 
for that co-investment or others could be obtained.

     Accordingly, in September 1996 the Managing Shareholder made 
a proxy solicitation requesting that the Investors in this Trust 
approve a proposal to end the Trust's status as a business 
development company.  The purpose of the change was to allow the 
Trust to invest with other programs sponsored by the Managing 
Shareholder, with only the approval of the Trust's Independent 
Trustees.  The Independent Trustees may not be "interested 
persons" (as defined by law) of the Trust or the Managing 
Shareholder.  The Managing Shareholder advised the Investors of 
its belief that the change would end the delays and uncertainties 
of seeking approval from the Securities and Exchange Commission 
(the "Commission") for such transactions and therefore would 
increase opportunities for the Trust to diversify its investments 
and to increase the size and quality of the potential investment 
pool.

     A majority in interest of the Investors approved an 
amendment to the Trust's Declaration of Trust by written consent.  
The amendment and the termination of business development company 
status became effective on October 3, 1996.  In summary, the 
amendment authorized the Trust to withdraw the business 
development company election.  It also defined a "Ridgewood 
Program Transaction" as a transaction with a Ridgewood Program, 
an entity controlled by a Ridgewood Program or Programs, or an 
entity in which a Ridgewood Program or Program has invested, that 
would otherwise be prohibited by the 1940 Act.  The amendment 
stated that Ridgewood Program Transactions will not be subject to 
any provision of the 1940 Act or rules thereunder that would 
restrict the Trust or entities the Trust controls or has invested 
inform entering into Ridgewood Program Transactions.  Instead, a 
Ridgewood Program Transaction must be approved either by the 
Managing Shareholder and a majority of the Independent Trustees, 
or by a majority of the Independent Trustees and a Majority of 
the Investors.  No express standards for approval are specified, 
although the Managing Shareholder and the Independent Trustees 
are subject to the fiduciary requirements of Delaware law in 
making their decisions.

     The amendment also required the Trust to continue to comply 
with all other requirements of the 1940 Act as if the Trust 
continued to be a business development company, except that the 
Trust would not be required to file any reports required of 
business development companies with the Commission or any other 
regulatory agency.  With regard to the requirements that the 
Trust will continue to adhere to, the Trust will not be able to 
request exemptive relief from or to take actions requiring 
approval by the Commission, and the Commission will not have the 
ability to regulate the Trust under the 1940 Act, because the 
Trust will no longer be subject to the Commission's authority 
over business development companies.

     The requirements of the 1940 Act that the Trust has promised 
to comply with, and those that it will not be required to follow, 
are listed in Exhibit 99 to this Annual Report on Form 10-K.  
Some of those requirements that are particularly relevant to the 
Trust's acquisitions of Projects are described below.

     The Trust may not acquire any asset other than a "Qualifying 
Asset" unless, at the time the acquisition is made, Qualifying 
Assets comprise at least 70% of the Trust's total assets by 
value.  The principal categories of Qualifying Assets that are 
relevant to the Trust's activities are:

(A)  Securities issued by "eligible portfolio companies" that are 
purchased by the Trust from the issuer in a transaction not 
involving any public offering (i.e., private placements of 
securities).  An "eligible portfolio company" (1) must be 
organized under the laws of the United States or a state and have 
its principal place of business in the United States; (2) may not 
be an investment company other than a small business investment 
company licensed by the Small Business Administration and wholly-
owned by the Trust and (3) may not have issued any class of 
securities that may be used to obtain margin credit from a broker 
or dealer in securities.  The last requirement essentially 
excludes all issuers that have securities listed on an exchange 
or quoted on the National Association of Securities Dealers, 
Inc.'s national market system, along with other companies 
designated by the Federal Reserve Board.  Except for temporary 
investments of the Trust's available funds, substantially all of 
the Trust's investments are expected to be Qualifying Assets 
under this provision.

(B)  Securities received in exchange for or distributed on or 
with respect to securities described in paragraph (A) above, or 
on the exercise of options, warrants or rights relating to those 
securities.

(C)  Cash, cash items, U.S. Government securities or high quality 
debt securities maturing not more than one year after the date of 
investment.

     A business development company must make available 
"significant managerial assistance" to the issuers of Qualifying 
Assets described in paragraphs (A) and (B) above, which may 
include without limitation arrangements by which the business 
development company (through its directors, officers or 
employees) offers to provide (and, if accepted, provides) 
significant guidance and counsel concerning the issuer's 
management, operation or business objectives and policies.

     A business development company also must be organized under 
the laws of the United States or a state, have its principal 
place of business in the United States and have as its purpose 
the making of investments in Qualifying Assets described in 
paragraph (A) above.

(d)  Financial Information about Foreign and Domestic Operations 
and Export Sales. 

     The Trust has committed funds to Projects located in Rhode 
Island, Maine and California.  Although the Managing Shareholder 
from time to time considers potential projects located outside 
the United States as potential investments for the Trust, the 
Trust has not acquired any Project located outside the United 
States.

(e)  Employees.

     The Trust has no employees.  The persons described below at 
Item 10 - Directors and Executive Officers of the Registrant 
serve as executive officers of the Trust and have the duties and 
powers usually applicable to similar officers of a Delaware 
corporation in carrying out the Trust business.

Item 2.  Properties.

     Pursuant to the Management Agreement between the Trust and 
the Managing Shareholder (described at Item 10(c)), the Managing 
Shareholder provides the Trust with office space at the Managing 
Shareholder's principal office at The Ridgewood Commons, 947 
Linwood Avenue, Ridgewood, New Jersey 07450.  

     The following table shows the material properties (relating 
to Projects) owned or leased by the Trust's subsidiaries or 
partnerships or limited liability companies in which the Trust 
has an interest.

                                                     Approximate
                                                       Square
                     Ownership  Ground   Approximate  Footage of   Description
                     Interests  Lease      Acreage    Project          of  
Projects   Location  in Land  Expiration   of Land    (Actual        Project
                                                     or Projected)

Provi-     Providence,
 dence     Rhode       Leased    2020        4         10,000       Landfill
           Island                                                  gas-fired
                                                                  generation
                                                                    facility
Maine Hydro 14 sites
            in Maine   Owned     n/a        24            n/a          Hydro-
                       by joint                                     electric
                       venture*                                   facilities

Pump Ser-   Ventura    License   n/a        n/a        nominal       Natural-
 vices       County,                                               gas-fueled
           California                                             engines for
                                                                   irrigation
                                                                pumps located
                                                                   on various
                                                                        farms
Maine    West Enfield  Owned     n/a       less        18,000     Wood waste-
 Bio-    and Jonesboro, by joint           than                 fired genera-
 mass    Maine          venture             25                  tion facility

*Joint venture equally owned by Trust and Ridgewood Power V.
**  Joint venture owned by Indeck Maine former members, the Trust
 and Ridgewood Power V.

Item 3.  Legal Proceedings.

     There are no legal proceedings involving the Trust.

Item 4.  Submission of Matters to a Vote of Security Holders.

     The Trust has not submitted any matters to a vote of its 
security holders during the fourth quarter of 1997.

PART II

Item 5.  Market for Registrant's Common Equity and Related 
Stockholder Matters.

(a)  Market Information.  

     The Trust sold 476.8 Investor Shares of beneficial interest 
in the Trust in its private placement offering, which concluded 
on September 30, 1996.  There is currently no established public 
trading market for the Investor Shares and the Trust does not 
intend to allow a public trading market to develop.  As of the 
date of this Form 10-K, all such Investor Shares have been issued 
and are outstanding.  There are no outstanding options or 
warrants to purchase, or securities convertible into, Investor 
Shares.

     Investor Shares are restricted as to transferability under 
the Declaration, as well as under federal and state laws 
regulating securities.  The Investor Shares have not been and are 
not expected to be registered under the Securities Act of 1933, 
as amended (the "1933 Act"), or under any other similar law of 
any state (except for certain registrations that do not permit 
free resale) in reliance upon what the Trust believes to be 
exemptions from the registration requirements contained therein.  
Because the Investor Shares have not been registered, they are 
"restricted securities" as defined in Rule 144 under the 1933 
Act.

     The Managing Shareholder is considering the possibility of a 
combination of the Trust and four other investment programs 
sponsored by the Managing Shareholder (Ridgewood Electric Power 
Trusts I, II, IV and V) into a publicly traded entity.  This 
would require the approval of the Investors in the Trust and the 
other programs after proxy solicitations complying with 
requirements of the Securities and Exchange Commission, 
compliance with the "rollup" rules of the Securities and Exchange 
Commission and other regulations, and a change in the federal 
income tax status of the Trust from a partnership (which is not 
subject to tax) to a corporation.  The process of considering and 
effecting a combination, if the decision is made to do so, will 
be very lengthy.  There is no assurance that the Managing 
Shareholder will recommend a combination, that the Investors of 
the Trust or other programs will approve it, that economic 
conditions or the business results of the participants will be 
favorable for a combination, that the combination will be 
effected or that the economic results of a combination, if 
effected, will be favorable to the Investors of the Trust or 
other programs.  

(b)  Holders

     As of the date of this Form 10-K, there are 943 record 
holders of Investor Shares.

(c)  Dividends

     The Trust made distributions as follows in 1996 and 1997:


                                      Year ended December 31,
                                         1996         1997
Total distributions to Investors      $1,659,928  $3,287,256
Distributions per Investor Share           3,481       6,894
Distributions to Managing Shareholder    $16,767     $33,205

     Distributions are made on a monthly basis.  The Trust's 
ability to make future distributions to Investors and their 
timing will depend on the net cash flow of the Trust and 
retention of reasonable reserves as determined by the Trust to 
cover its anticipated expenses.

     Subject to the other factors described in this Annual Report 
on Form 10-K, the Trust's goal is to provide Investors with 
annual distributions of net cash flow, as defined in the 
Declaration of Trust, of 14% of their Capital Contributions to 
the Trust.  Occasionally, distributions may include funds derived 
from the release of cash from operating or debt service reserves.  
For purposes of generally accepted accounting principles, amounts 
of distributions in excess of accounting income may be considered 
to be capital in nature.  Investors should be aware that the 
Trust is organized to return net cash flow rather than accounting 
income to Investors.

Item 6.  Selected Financial Data.

     The following data is qualified in its entirety by the 
financial statements presented elsewhere in this Annual Report on 
Form 10-K.

<TABLE>
<CAPTION>
Supplemental Information                                            As of and for the 
Schedule                                                          Period from Commencement 
Selected Financial                                                   of Share Offering 
Data                           As of and for the Years Ended        (February 6, 1995)
                                     December 31,                         through
                              1997                 1996              December 31, 1995
                                                                        (Restated)*
Total Fund Information:

<S>                        <C>                <C>                     <C>               
Net sales                      $6,810,911      $4,087,722                        $0
Net income (loss)                 402,777          72,769                  (156,133)
Net assets (shareholders'
  equity)                      35,023,361      38,746,599                13,502,131
Investments in Project
  development limited 
  partnerships, power 
  generation equipment 
  and developmental costs       26,048,431     20,467,908                         0
Investment in electric 
  power sales contract 
  (net of amortization)          7,391,828      7,947,697                         0
Total assets                    47,964,823     52,453,335                13,890,163
Long-term obligations            4,848,067      5,440,260                         0
Per Share of Trust 
 Interest:
  Revenues                          15,059         $9,121                        $0
  Net income (loss)                   (845)           153                      (963)
  Net asset value                   73,455         81,264                    83,295
Distributions to Investors           6,894          3,517                         0

</TABLE>
*   Restated on consolidation and equity method accounting 
principles.  See Item 8 - Financial Statements and Supplementary 
Data.

Item 7.  Management's Discussion and Analysis of Financial 
Condition and Results of Operations.

Introduction

     The following discussion and analysis should be read in 
conjunction with the Trust's financial statements and the notes 
thereto presented below.  Dollar amounts in this discussion are 
generally rounded to the nearest $1,000, except per share data.

     The consolidated financial statements include the accounts 
of the Trust and the limited partnerships owning the Providence 
and California Pumping Projects.  The Trust uses the equity 
method of accounting for its investments in the Maine Hydro 
Projects and the Indeck Maine Biomass Projects, which are owned 
50% by the Trust.

Outlook

     The U.S. electricity markets are being restructured and 
there is a trend away from regulated electricity systems towards 
deregulated, competitive market structures.  The States that the 
Trust's Projects operate in have passed or are considering new 
legislation that would permit utility customers to choose their 
electricity supplier in a competitive electricity market.  The 
Providence and Maine Hydro Projects are "Qualified Facilities" as 
defined under the Public Utility Regulatory Policies Act of 1978 
and currently sell their electric output to utilities under long-
term contracts.  The Providence contract expires in 2020 and 
eleven of the Maine Hydro contracts expire in 2008 and the 
remaining three expire in 2004, 2014 and 2017.  During the term 
of the contracts, the utilities may or may not attempt to buy out 
the contracts prior to expiration.  At the end of the contracts, 
the Projects will become merchant plants and may be able to sell 
the electric output at then current market prices.  There can be 
no assurance that future market prices will sufficient to allow 
the Trust's Projects to operate profitably.

     The Providence Project generates electricity from methane 
gas produced at the Central Landfill in Johnston, Rhode Island.  
Gas reserves are estimated to be in excess of the amount needed 
to generate the 12 Megawatt maximum under the Power Contract with 
New England Power Company.  The price paid for the gas is a 
percentage (15% to 18%) of net revenue from power sales.  
Accordingly, the Providence Project is not affected by fuel cost 
price changes.  The quality of the gas may vary from time to 
time.  Poor quality gas may cause operating problems, down time 
and unplanned maintenance at the generating facility.

     The Maine Hydro Projects have a limited ability to store 
water.  Accordingly, the amount of revenue from electricity 
generation from these Projects is directly related to river water 
flows, which have fluctuated as much as 30% from the average over 
the past ten years.  It is not possible to accurately predict 
revenues from the Maine Hydro Projects.

     The Indeck Maine Biomass Projects sold electricity under 
short-term contracts during the months of July, August, October, 
November and December 1997.  The Projects are currently shut down 
and will not be operated unless sales arrangements are obtained 
which would provide sufficient revenue to cover the Projects 
fixed and variable costs.  Under current legislation, the 
electricity market in the State of Maine will be deregulated on 
March 1, 2000.  Assuming biomass fuel can be purchased at 
reasonable prices in the year 2000 and beyond, the Indeck Maine 
Biomass Projects should be among the low cost producers of 
electricity in Maine and should be able to operate profitably in 
a competitive market environment.  In the meantime, the Trust 
intends to keep the Projects in an idle mode until market 
conditions become more favorable, and the Project operator will 
seek short-term contracts to sell energy, installed capacity and 
operable capacity.

     All Projects currently owned by the Trust produce 
electricity from renewable energy sources, such as landfill gas, 
hydropower and biomass ("Green Power").  In the State of Maine, 
as a condition of licensing, competitive generation providers and 
power marketers will have to demonstrate that at least 30% of 
their generation portfolio is Green Power sources.  Other States 
in the New England Power Pool have or are expected to have 
similar Green Power licensing requirements, although the 
percentage of Green Power generation may differ from State to 
State.  These Green Power licensing requirements should have a 
beneficial affect on the future profitability of the Trust's 
Projects.

     Industry trends that may affect results of operations in 
1998 and beyond are discussed above at Item 1(c)(4) - Business - 
Trends in the Electric Utility and Independent Power Industries.

Results of Operations
The year ended December 31, 1997 compared to the year ended 
December 31, 1996.

     In 1997, the Trust had a net loss of $403,000 as compared to 
net income of $73,000 in 1996.  The 1997 results include 
earnings, net of minority interest, from the Providence Project 
of $964,000, equity in net income from the Maine Hydro Projects 
of $522,000, equity in the net loss of the Indeck Maine Biomass 
Projects of $680,000, and a minor contribution from the 
California Pumping Project of $10,000, interest income at the 
Trust level of $701,000, less Trust level expenses of $1,920,000.  
The Trust-level expenses include  management fees, due diligence 
costs and general, and administrative and other expenses of 
$1,155,000, $669,000 and $96,000, respectively.

     The Trust's only investments in the first nine months of 
1996 were the Providence Project and the California Pumping 
Project and the Trust had significant investment fee expenses 
relating to the share offering. Net income for 1996 of $73,000, 
includes earnings, net of minority interest, from the Providence 
Project of $520,000, equity in net income from the Maine Hydro 
Projects of $99,000 a minor contribution to earnings from the 
California Pumping Project of $16,000, interest income at the 
Trust level of $1,004,000, less Trust-level expenses of 
$1,566,000.  The Trust-level expenses include investment fees, 
management fees and general, and administrative and other 
expenses of $628,000, $845,000 and $93,000, respectively.

The year ended December 31, 1996 compared to the period from 
February 6, 1995 to December 31, 1995.

     During 1995, the Trust had not yet acquired any interests in 
Projects and its activities were limited to organizational and 
offering efforts and to initial review of potential investments.

     The Trust acquired the California Pumping Project at the end 
of 1995 and acquired its interest in the Providence Project on 
April 16, 1996.  The Trust closed on the acquisition of its 50% 
in the Maine Hydro Projects on December 23, 1996.  Accordingly, 
the 1995 results reflected only income earned on interim 
investments and Trust level administration expenses, while the 
1996 results primarily reflect the results of the Providence 
Project for eight and one half months, and insignificant results 
from the California Pumping and Maine Hydro Projects.

     Total 1996 revenues from the operating Projects were 
$4,349,000 and, after subtracting the $2,992,000 cost of sales, 
the 1996 gross profit from operations was $1,357,000 (a 31.2% 
operating margin).  Other operating expenses, primarily 
reflecting the costs of administering the Trust and carrying on 
its investment program, totaled $1,994,000, as compared with 
$454,000 in 1995.  The 339.2% increase was caused primarily by 
the $888,000 management fee (3% of net asset value) that was 
charged for the first time in 1996 and a $323,000 (105.9%) 
increase in the investment fee.  The increase in the investment 
fee was directly proportional to the higher level of sales of 
Investor Shares in 1996.  There was also a $303,000 (439.1%) 
increase in general and administrative expenses, reflecting the 
larger size of the Trust, costs of the Providence Project, the 
increase in the number of Investors and the costs of the proxy 
solicitation and related legal and accounting expenses.  As a 
result of these factors, the operating loss for 1996 increased by 
only $183,000 (40.2%) from 1995 to 1996.

     Non-operating income in 1996 (up $701,000, or 235.2% from 
1995) was made up of interest income on the Trust's uninvested 
funds and a small amount of accrued income from the eight days on 
which the Trust owned a 50% interest in the Maine Hydro Projects.  
Against this in 1996 was subtracted $395,000 of interest expense 
on the debt encumbering the Providence Project.

     Distributions from the Providence Project for 1996 were low 
(an 11.6% annualized return on investment) but within 
expectations.  At the time the Project was purchased its 
profitability was low and the Trust planned to make major 
investments and changes to operations to increase efficiency.  
Electric output increased by an average of 33% in the eight and 
one half months in which RPMC has operated the Project in 1996.

Liquidity and Capital Resources

     As of December 31, 1997, the Trust had raised approximately 
$40,507,000 of funds from its offering, net of offering fees and 
expenses.  The Trust has invested $12,850,000 in the Providence 
Project, $7,080,000 in the Maine Hydro Projects, $7,298,000 in 
the Indeck Maine Biomass Project, $723,000 in the California 
Pumping Project and $455,000 in equipment.

     At December 31, 1997, the Trust had $11,086,000 of cash 
available for investment in Projects.  Cash flow provided by 
operation activities in 1997 amounted to $2,656,000.  
Distributions to shareholders of the Trust amounted to 
$3,320,000. 

     In 1997, capital expenditures amounted to $3,060,000, most 
of which related to the installation of a ninth generator engine 
at the Providence Project.

     During the fourth quarter of 1997, the Trust and Fleet Bank, 
N.A. (the "Bank") entered into a revolving line of credit 
agreement, whereby the Bank provides a three year committed line 
of credit facility of $1,150,000.  Outstanding borrowings bear 
interest at the Bank's prime rate or, at the Trust's choice, at 
LIBOR plus 2.5%.  The credit agreement requires the Trust to 
maintain a ratio of total debt to tangible net worth of no more 
than 1 to 1 and a minimum debt service coverage ratio of 2 to 1.  
The credit facility was obtained in order to allow the Trust to 
operate using a minimum amount of cash, maximize the amount 
invested in Projects and maximize cash distributions to 
shareholders.  There were no borrowings under the line of credit 
in 1997.

     Other than investments of available cash in power generation 
Projects, obligations of the Trust are generally limited to 
payment of Project operating expenses, payment of a management 
fee to the Managing Shareholder, payments for certain accounting 
and legal services to third persons and distributions to 
shareholders of available operating cash flow generated by the 
Trust's investments.  The Trust's policy is to distribute as much 
cash as is prudent to shareholders.  Accordingly, the Trust has 
not found it necessary to retain a material amount of working 
capital.  The amount of working capital retained is further 
reduced by the availability of the line of credit facility.

     The Trust anticipates that during 1998 its cash flow from 
operations, unexpended offering proceeds and line of credit 
facility will be adequate to fund its obligations.

Financial instruments

     The Trust's investments in financial instruments are short-
term investments of working capital or excess cash.  Those short-
term investments are limited by its Declaration of Trust to 
investments in United States government and agency securities or 
to obligations of banks having at least $5 billion in assets.  
Currently the Trust invests only in bank obligations of Fleet 
Bank, N.A.  Because the Trust invests only in short-term 
instruments for cash management, its exposure to interest rate 
changes is low.

Year 2000 Remediation

     The Managing Shareholder and its affiliates began year 2000 
review and planning in early 1997.  After initial remediation was 
completed, a more intensive review discovered additional issues 
and the Managing Shareholder began a formal remediation program 
in late 1997.  The Managing Shareholder has assessed problems, 
has a written plan for remediation and is implementing the plan 
on schedule.  

     The accounting, network and financial packages for the 
Ridgewood companies are basically off-the-shelf packages that 
will be remediated, where necessary, by obtaining patches or 
updated versions.  The Managing Shareholder expects that updating 
will be complete before the end of 1998 with ample time for 
implementation, testing and custom changes to some modifications 
made by Ridgewood to those programs.  

     The marketing and investor relations functions rely on 
custom-written software and the Managing Shareholder has hired a 
specialist to remedy that software. The year 2000 changes in the 
distribution system, which is used to send checks to Investors, 
have been completed and are being tested.  The effort is on 
schedule to complete remediation and testing by December 31, 1998 
and the Managing Shareholder believes that all material systems 
will be year 2000 compliant by early 1999.  Some systems are 
being remediated using the "sliding window" technique.  Although 
this will allow compliance for several years beyond the year 
2000, eventually those systems will have to be rewritten again or 
replaced.

     The Managing Shareholder and its affiliates do not 
significantly rely on computer input from suppliers and customers 
and thus are not directly affected by other companies' year 2000 
compliance.  However, if customers' payment systems or suppliers' 
systems were adversely affected by year 2000 problems, the Trust 
could be affected.  Because the Trust and the Managing 
Shareholder are extremely small relative to the size of their 
material customers and suppliers and are paid or supplied using 
the same systems as larger companies, requests for written 
assurances of compliance from those customers or suppliers are 
not cost-effective.

     Although the total cost associated with year 2000 compliance 
is not yet determined, the Trust does not believe that the costs 
will be material to its financial position or results of 
operation.


Item 8.  Financial Statements and Supplementary Data.

Index to Financial Statements       
Report of Independent Accountants                   F-2  
Balance Sheets at December 31, 1997 and 1996        F-3  
Statement of Operations for Years Ended
  December 31, 1997 and 1996 and for Period 
  from Commencement of Share Offering 
  (February 6, 1995) through December 31, 1995      F-4  
Statement of Changes in Shareholders' Equity for
  Years Ended December 31, 1997 and 1996 and for
  Period from Commencement of Share Offering
  through December 31, 1995                         F-5  
Statement of Cash Flows for 
  Years Ended December 31, 1997 and 1996 and for
  Period from Commencement of Share Offering 
  through December 31, 1995                         F-6  
Notes to Financial Statements               F-7 to F-17

Financial Statements for Maine Hydro Projects *
Financial Statements for Maine Biomass Projects*

*To be supplied by amendment.

     All schedules are omitted because they are not applicable or 
the required information is shown in the financial statements or 
notes thereto.

     The financial statements are presented in accordance with 
generally accepted accounting principles for operating companies, 
using consolidation and equity method accounting principles.  
This differs from the basis used by the three prior independent 
power programs sponsored by the Managing Shareholder, which 
present the Trust's investments in Projects on the estimated fair 
value method rather than the consolidation and equity accounting 
method.  The financial statements for 1995 have been restated on 
the same basis used for 1996 and 1997.  No material changes in 
net income or cash flow resulted..

Item 9.  Changes in and Disagreements with Accountants on 
Accounting and Financial Disclosure.

     Neither the Trust nor the Managing Shareholder has had an 
independent accountant resign or decline to continue providing 
services since their respective inceptions and neither has 
dismissed an independent accountant during that period.  During 
that period of time no new independent accountant has been 
engaged by the Trust or the Managing Shareholder, and the 
Managing Shareholder's current accountants, Price Waterhouse LLP, 
have been engaged by the Trust.

PART III

Item 10.  Directors and Executive Officers of the Registrant.

(a)  General.

     As Managing Shareholder of the Trust, Ridgewood Power 
Corporation has direct and exclusive discretion in management and 
control of the affairs of the Trust (subject to the general 
supervision and review of the Independent Trustees and the 
Managing Shareholder acting together as the Board of the Trust). 
The Managing Shareholder will be entitled to resign as Managing 
Shareholder of the Trust only (i) with cause (which cause does 
not include the fact or determination that continued service 
would be unprofitable to the Managing Shareholder) or (ii) 
without cause with the consent of a majority in interest of the 
Investors.  It may be removed from its capacity as Managing 
Shareholder as provided in the Declaration.

     Ridgewood Energy Holding Corporation ("Ridgewood Holding"), 
a Delaware corporation incorporated in April 1992, is the 
Corporate Trustee of the Trust.

(b)  Managing Shareholder.

     The Managing Shareholder was incorporated in February 1991 
as a Delaware corporation for the primary purpose of acting as a 
managing shareholder of business trusts and as a managing general 
partner of limited partnerships which are organized to 
participate in the development, construction and ownership of 
Independent Power Projects.

     The Managing Shareholder has also organized Ridgewood 
Electric Power Trust I ("Ridgewood Power I"), Ridgewood Electric 
Power Trust II ("Ridgewood Power II"), Ridgewood Electric Power 
Trust III ("Ridgewood Power III"), Ridgewood Electric Power Trust 
V ("Ridgewood Power V") and The Ridgewood Power Growth Fund (the 
"Growth Fund") as Delaware business trusts to participate in the 
independent power industry.  The business objectives of these 
four trusts are similar to those of the Trust.

     The Managing Shareholder is an affiliate of Ridgewood Energy 
Corporation ("Ridgewood Energy"), which has organized and 
operated 46 limited partnership funds and one business trust over 
the last 16 years (of which 25 have terminated) and which had 
total capital contributions in excess of $190 million.  The 
programs operated by Ridgewood Energy have invested in oil and 
natural gas drilling and completion and other related activities.  
Other affiliates of the Managing Shareholder include Ridgewood 
Securities Corporation ("Ridgewood Securities"), an NASD member 
which has been the placement agent for the private placement 
offerings of the six trusts sponsored by the Managing Shareholder 
and the funds sponsored by Ridgewood Energy; Ridgewood Power 
Capital Corporation ("Ridgewood Capital"), organized in 1998, 
which assists in offerings made by the Managing Shareholder; and 
Ridgewood Power VI Corporation ("Power VI Corp."), which is a 
managing shareholder of the Growth Fund and RPMC.  Each of these 
corporations is wholly owned by Robert E. Swanson, who is their 
sole director.

     Robert E. Swanson has been the President, sole director and 
sole stockholder of the Managing Shareholder since its inception 
in February 1991.  Set forth below is certain information 
concerning Mr. Swanson and other executive officers of the 
Managing Shareholder.

     Robert E. Swanson, age 51, has also served as President of 
the Trust since its inception in November 1992 and as President 
of RPMC, Ridgewood Power I, Ridgewood Power II, Ridgewood Power 
III, Ridgewood Power V and the Growth Fund, since their 
respective inceptions.  Mr. Swanson has been President and 
registered principal of Ridgewood Securities and became the 
Chairman of the Board of Ridgewood Capital on its organization in 
1998.  In addition, he has been President and sole stockholder of 
Ridgewood Energy since its inception in October 1982.  Prior to 
forming Ridgewood Energy in 1982, Mr. Swanson was a tax partner 
at the former New York and Los Angeles law firm of Fulop & Hardee 
and an officer in the Trust and Investment Division of Morgan 
Guaranty Trust Company.  His specialty is in personal tax and 
financial planning, including income, estate and gift tax.  Mr. 
Swanson is a member of the New York State and New Jersey bars, 
the Association of the Bar of the City of New York and the New 
York State Bar Association.  He is a graduate of Amherst College 
and Fordham University Law School.  

     Robert L. Gold, age 39, has served as Executive Vice 
President of the Managing Shareholder, RPMC, Ridgewood Power I, 
the Trust, Ridgewood Power II, Ridgewood Power III, Ridgewood 
Power V and the Growth Fund since their respective inceptions, 
with primary responsibility for marketing and acquisitions.  He 
has been President of Ridgewood Power Capital Corporation since 
its organization in 1998.  He has served as Vice President and 
General Counsel of Ridgewood Securities Corporation since he 
joined the firm in December 1987.  Mr. Gold has also served as 
Executive Vice President of Ridgewood Energy since October 1990.  
He served as Vice President of Ridgewood Energy from December 
1987 through September 1990. For the two years prior to joining 
Ridgewood Energy and Ridgewood Securities Corporation, Mr. Gold 
was a corporate attorney in the law firm of Cleary, Gottlieb, 
Steen & Hamilton in New York City where his experience included 
mortgage finance, mergers and acquisitions, public offerings, 
tender offers, and other business legal matters. Mr. Gold is a 
member of the New York State bar.  He is a graduate of Colgate 
University and New York University School of Law.

     Thomas R. Brown, age 43, joined the Managing Shareholder in 
November 1994 as Senior Vice President and holds the same 
position with the Trust, RPMC and each of the other trusts 
sponsored by the Managing Shareholder.  He became Chief Operating 
Officer of the Managing Shareholder, RPMC and the Ridgewood Power 
I through V trusts in October 1996, and is the Chief Operating 
Officer of the Growth Fund.  Mr. Brown has over 20 years' 
experience in the development and operation of power and 
industrial projects.  From 1992 until joining the Managing 
Shareholder he was employed by Tampella Services, Inc., an 
affiliate of Tampella, Inc., one of the world's largest 
manufacturers of boilers and related equipment for the power 
industry.  Mr. Brown was Project Manager for Tampella's Piney 
Creek project, a $100 million bituminous waste coal fired 
circulating fluidized bed power plant.  Between 1990 and 1992 Mr. 
Brown was Deputy Project Manager at Inter-Power of Pennsylvania, 
where he successfully developed a 106 megawatt coal fired 
facility.  Between 1982 and 1990 Mr. Brown was employed by 
Pennsylvania Electric Company, an integrated utility, as a Senior 
Thermal Performance Engineer.  Prior to that, Mr. Brown was an 
Engineer with Bethlehem Steel Corporation.  He has an Bachelor of 
Science degree in Mechanical Engineering from Pennsylvania State 
University and an MBA in Finance from the University of 
Pennsylvania.  Mr. Brown satisfied all requirements to earn the 
Professional Engineer designation in 1985.

     Martin V. Quinn, age 50, assumed the duties of Chief 
Financial Officer of the Managing Shareholder, the Trust, the 
other four trusts organized by the Managing Shareholder and RPMC 
in November 1996 under a consulting arrangement.  He became a 
full-time officer of the Managing Shareholder and RPMC in April 
1997 and is now also Chief Financial Officer of the Growth Fund.  

     Mr. Quinn has 29 years of experience in financial management 
and corporate mergers and acquisitions, gained with major, 
publicly-traded companies and an international accounting firm. 
He formerly served as Vice President of Finance and Chief 
Financial Officer of NORSTAR Energy, an energy services company, 
from February 1994 until June 1996.  From 1991 to March 1993, Mr. 
Quinn was employed by Brown-Forman Corporation, a diversified 
consumer products company and distiller, where he was Vice 
President-Corporate Development.  From 1981 to 1991, Mr. Quinn 
held various officer-level positions with NERCO, Inc., a mining 
and natural resource company, including Vice President- 
Controller and Chief Accounting Officer for his last six years 
and Vice President-Corporate Development.  Mr. Quinn's 
professional qualifications include his certified public 
accountant qualification in New York State, membership in the 
American Institute of Certified Public Accountants, six years of 
experience with the international accounting firm of Price 
Waterhouse, and a Bachelor of Science degree in Accounting and 
Finance from the University of Scranton (1969).

     Mary Lou Olin, age 45, has served as Vice President of the 
Managing Shareholder, RPMC, Ridgewood Capital, the Trust, 
Ridgewood Power I, Ridgewood Power II, Ridgewood Power III, 
Ridgewood Power V and the Growth Fund since their respective 
inceptions.  She has also served as Vice President of Ridgewood 
Energy since October 1984, when she joined the firm.  Her primary 
areas of responsibility are investor relations, communications 
and administration.  Prior to her employment at Ridgewood Energy, 
Ms. Olin was a Regional Administrator at McGraw-Hill Training 
Systems where she was employed for two years.  Prior to that, she 
was employed by RCA Corporation.  Ms. Olin has a Bachelor of Arts 
degree from Queens College.

(c)  Management Agreement.

     The Trust has entered into a Management Agreement with the 
Managing Shareholder detailing how the Managing Shareholder will 
render management, administrative and investment advisory 
services to the Trust.  Specifically, the Managing Shareholder 
will perform (or arrange for the performance of) the management 
and administrative services required for the operation of the 
Trust.  Among other services, it will administer the accounts and 
handle relations with the Investors, provide the Trust with 
office space, equipment and facilities and other services 
necessary for its operation and conduct the Trust's relations 
with custodians, depositories, accountants, attorneys, brokers 
and dealers, corporate fiduciaries, insurers, banks and others, 
as required.  The Managing Shareholder will also be responsible 
for making investment and divestment decisions, subject to the 
provisions of the Declaration.

     The Managing Shareholder will be obligated to pay the 
compensation of the personnel and all administrative and service 
expenses necessary to perform the foregoing obligations.  The 
Trust will pay all other expenses of the Trust, including 
transaction expenses, valuation costs, expenses of preparing and 
printing periodic reports for Investors and the Commission, 
postage for Trust mailings, Commission fees, interest, taxes, 
legal, accounting and consulting fees, litigation expenses and 
other expenses properly payable by the Trust.  The Trust will 
reimburse the Managing Shareholder for all such Trust expenses 
paid by it.

     As compensation for the Managing Shareholder's performance 
under the Management Agreement, the Trust is obligated to pay the 
Managing Shareholder an annual management fee described below at 
Item 13 -- Certain Relationships and Related Transactions.

     The Board of the Trust (including both initial Independent 
Trustees) have approved the initial Management Agreement and its 
renewals.  Each Investor consented to the terms and conditions of 
the initial Management Agreement by subscribing to acquire 
Investor Shares in the Trust.  The Management Agreement will 
remain in effect until January 4, 1999 and year to year 
thereafter as long as it is approved at least annually by (i) 
either the Board of the Trust or a majority in interest of the 
Investors and (ii) a majority of the Independent Trustees.  The 
agreement is subject to termination at any time on 60 days' prior 
notice by the Board, a majority in interest of the Investors or 
the Managing Shareholder.  The agreement is subject to amendment 
by the parties with the approval of (i) either the Board or a 
majority in interest of the Investors and (ii) a majority of the 
Independent Trustees.

(d)  Executive Officers of the Trust.

     Pursuant to the Declaration, the Managing Shareholder has 
appointed officers of the Trust to act on behalf of the Trust and 
sign documents on behalf of the Trust as authorized by the 
Managing Shareholder.  Mr. Swanson has been named the President 
of the Trust and the other executive officers of the Trust are 
identical to those of the Managing Shareholder, with the addition 
of Joseph A. Heyison, Senior Vice President and General Counsel.  
Mr. Heyison, age 43, joined RPMC in January 1996.  He was 
previously of counsel to the law firm of De Forest & Duer, 
concentrating in corporate finance, banking, environmental law 
and securities.  He is a member of the bars of New Jersey, New 
York and Ohio and was graduated from the University of 
Pennsylvania Law School in 1979.

     The officers have the duties and powers usually applicable 
to similar officers of a Delaware business corporation in 
carrying out Trust business.  Officers act under the supervision 
and control of the Managing Shareholder, which is entitled to 
remove any officer at any time.  Unless otherwise specified by 
the Managing Shareholder, the President of the Trust has full 
power to act on behalf of the Trust.  The Managing Shareholder 
expects that most actions taken in the name of the Trust will be 
taken by Mr. Swanson and the other principal officers in their 
capacities as officers of the Trust under the direction of the 
Managing Shareholder rather than as officers of the Managing 
Shareholder. 

(e)  The Trustees.

     The 1940 Act requires the Independent Trustees to be 
individuals who are not "interested persons" of the Trust as 
defined under the 1940 Act (generally, persons who are not 
affiliated with the Trust or with affiliates of the Trust). There 
must always be at least two Independent Trustees; a larger number 
may be specified by the Board from time to time.  Each 
Independent Trustee has an indefinite term.  Vacancies in the 
authorized number of Independent Trustees will be filled by vote 
of the remaining Board members so long as there is at least one 
Independent Trustee; otherwise, the Managing Shareholder must 
call a special meeting of Investors to elect Independent 
Trustees.  Vacancies must be filled within 90 days.  An 
Independent Trustee may resign effective on the designation of a 
successor and may be removed for cause by at least two-thirds of 
the remaining Board members or with or without cause by action of 
the holders of at least two-thirds of Shares held by Investors. 
Under the Declaration, the Independent Trustees are authorized to 
act only where their consent is required under the 1940 Act and 
to exercise a general power to review and oversee the Managing 
Shareholder's other actions.  They are under a fiduciary duty 
similar to that of corporation directors to act in the Trust's 
best interest and are entitled to compel action by the Managing 
Shareholder to carry out that duty, if necessary, but ordinarily 
they have no duty to manage or direct the management of the Trust 
outside their enumerated responsibilities.

     The Independent Trustees of the Trust are John C. Belknap 
and Dr. Richard D. Propper.  Mr. Belknap and Dr. Propper also 
serve as independent trustees for Ridgewood Power I and the 
Growth Fund.  Set forth below is certain information concerning 
these individuals, who are not otherwise affiliated with the 
Trust, the Managing Shareholder or their directors, officers or 
agents.

     John C. Belknap, age 49, has been chief financial officer of 
three national retail chains and their parent companies.  Since 
July 1997, he has been Executive Vice President and Chief 
Financial Officer of Richfood Holdings, Inc., a Virginia-based 
food manufacturer.  From December 1995 to June 1997 Mr. Belknap 
was Executive Vice President and Chief Financial Officer of 
OfficeMax, Inc., a national chain of office supply stores.  From 
February 1994 to February 1995, Mr. Belknap was Executive Vice 
President and Chief Financial Officer of Zale Corporation, a 
1,200 store jewelry retail chain.  From January 1990 to January 
1994 and from February 1995 to December 1995, Mr. Belknap was an 
independent financial consultant.  From January 1989 through May 
1993 he aso served as a director of and consultant to Finlay 
Enterprises, Inc., an operator of leased fine jewelry departments 
in major department stores nationwide.  Prior to 1989, Mr. 
Belknap served as Chief Financial Officer of Seligman & Latz, Kay 
Corporation and its subsidiary, Kay Jewelers, Inc.

     From January 1990 until February 1994, Mr. Belknap consulted 
in a variety of strategic corporate transactions, including 
mergers and acquisitions, divestitures and refinancing.  One such 
transaction involved the recapitalization and change of control 
of Finlay in May 1993.  From 1979 to 1985, Mr. Belknap served as 
Chief Financial Officer of Kay Corporation ("Kay"), the parent of 
Kay Jewelers, Inc. ("KJI"), a national chain of jewelry stores 
and leased jewelry departments in major department stores.  He 
served as Chief Financial Officer of KJI from 1974 to 1979 and as 
its Assistant Controller from 1973 to 1974.  Between 1970 and 
1973, Mr. Belknap was a senior auditor at Arthur Young & Company 
(now Ernst & Young), a national accounting firm.  Mr. Belknap 
earned BA and MBA degrees from Cornell University.

     Dr. Richard D. Propper, age 47, graduated from McGill 
University in 1969 and received his medical degree from Stanford 
University in 1972.  He completed his internship and residency in 
Pediatrics in 1974, and then attended Harvard University for post 
doctoral training in hematology/oncology.  Upon the completion of 
such training, he joined the staff of the Harvard Medical School 
where he served as an assistant professor until 1983.  In 1983, 
Dr. Propper left academic medicine to found Montgomery Medical 
Ventures, one of the largest medical technology venture capital 
firms in the United States.  He served as managing general 
partner of Montgomery Medical Ventures until 1993.

     Dr. Propper is currently a consultant to a variety of 
companies for medical matters, including international 
opportunities in medicine.  In June 1996 Dr. Propper agreed to an 
order of the Commission that required him to make filings under 
Sections 13(d) and (g) and 16 of the 1934 Act and that imposed a 
civil penalty of $15,000.  In entering into that agreement, Dr. 
Propper did not admit or deny any of the alleged failures to file 
recited in that order.

     The Corporate Trustee of the Trust is Ridgewood Holding.  
Legal title to Trust property is now and in the future will be in 
the name of the Trust, if possible, or Ridgewood Holding as 
trustee.  Ridgewood Holding is also a trustee of Ridgewood Power 
I, Ridgewood Power II, Ridgewood Power III and of an oil and gas 
business trust sponsored by Ridgewood and is expected to be a 
trustee of other similar entities that may be organized by the 
Managing Shareholder and Ridgewood Energy.  The President, sole 
director and sole stockholder of Ridgewood Holding is Robert E. 
Swanson; its other executive officers are identical to those of 
the Managing Shareholder. The principal office of Ridgewood 
Holding is at 1105 North Market Street, Suite 1300, Wilmington, 
Delaware 19899.

     The Trustees are not liable to persons other than 
Shareholders for the obligations of the Trust.

     The Trust has relied and will continue to rely on the 
Managing Shareholder and engineering, legal, investment banking 
and other professional consultants (as needed) and to monitor and 
report to the Trust concerning the operations of Projects in 
which it invests, to review proposals for additional development 
or financing, and to represent the Trust's interests.  The Trust 
will rely on such persons to review proposals to sell its 
interests in Projects in the future.

(f)  Section 16(a) Beneficial Ownership Reporting Compliance

     All individuals subject to the requirements of Section 16(a) 
have complied with those reporting requirements during 1997.

(g)  RPMC.

     As discussed above at Item 1 - Business, RPMC assumed day-
to-day management responsibility for the Providence Project.  
Like the Managing Shareholder, RPMC is wholly owned by Robert E. 
Swanson.  It entered into an "Operation Agreement" with the 
Trust's subsidiary that owns the Project under which RPMC, under 
the supervision of the Managing Shareholder, will provide the 
management, purchasing, engineering, planning and administrative 
services for the Providence Project.   RPMC will charge the Trust 
at its cost for these services and for the Trust's allocable 
amount of certain overhead items.  RPMC shares space and 
facilities with the Managing Shareholder and its affiliates. To 
the extent that common expenses can be reasonably allocated to 
RPMC, the Managing Shareholder may, but is not required to, 
charge RPMC at cost for the allocated amounts and such allocated 
amounts will be borne by the Trust and other programs.  Common 
expenses that are not so allocated will be borne by the Managing 
Shareholder.  

     Initially, the Managing Shareholder does not anticipate 
charging RPMC for the full amount of rent, utility supplies and 
office expenses allocable to RPMC.  As a result, both initially 
and on an ongoing basis the Managing Shareholder believes that 
RPMC's charges for its services to the Trust are likely to be 
materially less than its economic costs and the costs of engaging 
comparable third persons as managers.  RPMC will not receive any 
compensation in excess of its costs.

     Allocations of costs will be made either on the basis of 
identifiable direct costs, time records or in proportion to each 
program's investments in Projects managed by RPMC;  and 
allocations will be made in a manner consistent with generally 
accepted accounting principles.

     RPMC will not provide any services related to the 
administration of the Trust, such as investment, accounting, tax, 
investor communication or regulatory services, nor will it 
participate in identifying, acquiring or disposing of Projects.  
RPMC will not have the power to act in the Trust's name or to 
bind the Trust, which will be exercised by the Managing 
Shareholder or the Trust's officers.

     The Operation Agreement does not have a fixed term and is 
terminable by RPMC, by the Managing Shareholder or by vote of a 
majority in interest of Investors, on 60 days' prior notice. The 
Operation Agreement may be amended by agreement of the Managing 
Shareholder and RPMC; however, no amendment that materially 
increases the obligations of the Trust or that materially 
decreases the obligations of RPMC  shall become effective until 
at least 45 days after notice of the amendment, together with the 
text thereof, has been given to all Investors. 

     The executive officers of RPMC are Mr. Swanson (President), 
Mr. Gold (Executive Vice President), Mr. Brown (Senior Vice 
President and Chief Operating Officer), Mr. Quinn (Senior Vice 
President and Chief Financial Officer), Ms. Olin (Vice President) 
and Mr. Heyison, (Senior Vice President and General Counsel).  
Douglas V. Liebschner, Vice President - Operations, is a key 
employee.

     Douglas V. Liebschner, age 50, joined RPMC in June 1996 as 
Vice President of Operations.  He has over 27 years of experience 
in the operation and maintenance of power plants.  From 1992 
until joining RPMC, he was employed by Tampella Services, Inc., 
an affiliate of Tampella, Inc., one of the world's largest 
manufacturers of boilers and related equipment for the power 
industry.  Mr. Liebschner was Operations Supervisor for 
Tampella's Piney Creek project, a $100 million bituminous waste 
coal fired circulating fluidized bed ("CFB") power plant. Between 
1989 and 1992, he supervised operations of a waste to energy 
plant in Poughkeepsie, N.Y. and an anthracite-waste-coal-burning 
CFB in Frackville, Pa.  From 1969 to 1989, Mr. Liebschner served 
in the U.S. Navy, retiring with the rank of Lieutenant Commander.  
While in the Navy, he served mainly in billets dealing with the 
operation, maintenance and repair of ship propulsion plants, 
twice serving as Chief Engineer on board U.S. Navy combatant 
ships.  He has a Bachelor of Science degree from the U.S. Naval 
Academy, Annapolis, Md.

Item 11.  Executive Compensation.

     Through 1995, the executive officers of the Trust and the 
Managing Shareholder were compensated by Ridgewood Energy.  The 
Trust was not charged for their compensation; the Managing 
Shareholder remitted a portion of the fees paid to it by the 
Trust to reimburse Ridgewood Energy for employment costs incurred 
on Ridgewood Power's business.  In 1996 and future years, the 
Managing Shareholder compensates its officers without additional 
payments by the Trust and will be reimbursed by Ridgewood Energy 
for costs related to Ridgewood Energy's business.  The Trust will 
reimburse RPMC at cost for services provided by RPMC's employees; 
no such reimbursement per employee exceeded $60,000 in 1996 or 
1997  Information as to the fees payable to the Managing 
Shareholder and certain affiliates is contained at Item 13 - 
Certain Relationships and Related Transactions.

     As compensation for services rendered to the Trust, pursuant 
to the Declaration, each Independent Trustee is entitled to be 
paid by the Trust the sum of $5,000 annually and to be reimbursed 
for all reasonable out-of-pocket expenses relating to attendance 
at Board meetings or otherwise performing his duties to the 
Trust.  Accordingly in January 1995 and following years the Trust 
paid each Independent Trustee $5,000 for his services.  The Board 
of the Trust is entitled to review the compensation payable to 
the Independent Trustees annually and increase or decrease it as 
the Board sees reasonable.  The Trust is not entitled to pay the 
Independent Trustees compensation for consulting services 
rendered to the Trust outside the scope of their duties to the 
Trust without prior Board approval.

     Ridgewood Holding, the Corporate Trustee of the Trust, is 
not entitled to compensation for serving in such capacity, but is 
entitled to be reimbursed for Trust expenses incurred by it which 
are properly reimbursable under the Declaration.

Item 12.  Security Ownership of Certain Beneficial Owners and 
Management.

     The Managing Shareholder purchased for cash one full 
Investor Share. By virtue of its purchase of Investor Shares, the 
Managing Shareholder is entitled to the same ratable interest in 
the Trust as all other purchasers of Investor Shares.  No other 
Trustees or executive officers of the Trust acquired Investor 
Shares in the Trust's offering.  No person beneficially owns 5% 
or more of the Investor Shares.

     The Managing Shareholder was issued one Management Share in 
the Trust representing the beneficial interests and management 
rights of the Managing Shareholder in its capacity as the 
Managing Shareholder (excluding its interest in the Trust 
attributable to Investor Shares it acquired in the offering).  
The management rights of the Managing Shareholder are described 
in further detail above at Item 1 - Business and below in Item 
10.  Directors and Executive Officers of the Registrant.  Its 
beneficial interest in cash distributions of the Trust and its 
allocable share of the Trust's net profits and net losses and 
other items attributable to the Management Share are described in 
further detail below at Item 13 -- Certain Relationships and 
Related Transactions.

Item 13.  Certain Relationships and Related Transactions.

     The Declaration provides that cash flow of the Trust, less 
reasonable reserves which the Trust deems necessary to cover 
anticipated Trust expenses, is to be distributed to the Investors 
and the Managing Shareholder (collectively, the "Shareholders"), 
from time to time as the Trust deems appropriate.  Prior to 
Payout (the point at which Investors have received cumulative 
distributions equal to the amount of their capital 
contributions), each year all distributions from the Trust, other 
than distributions of the revenues from dispositions of Trust 
Property, are to be allocated 99% to the Investors and 1% to the 
Managing Shareholder until Investors have been distributed during 
the year an amount equal to 14% of their total capital 
contributions (a "14% Priority Distribution"), and thereafter all 
remaining distributions from the Trust during the year, other 
than distributions of the revenues from dispositions of Trust 
Property, are to be allocated 80% to Investors and 20% to the 
Managing Shareholder.  Revenues from dispositions of Trust 
Property are to be distributed 99% to Investors and 1% to the 
Managing Shareholder until Payout.  In all cases, after Payout, 
Investors are to be allocated 80% of all distributions and the 
Managing Shareholder 20%.    

     For any fiscal period, the Trust's net profits, if any, 
other than those derived from dispositions of Trust Property, are 
allocated 99% to the Investors and 1% to the Managing Shareholder 
until the profits so allocated offset (1) the aggregate 14% 
Priority Distribution to all Investors and (2) any net losses 
from prior periods that had been allocated to the Shareholders.  
Any remaining net profits, other than those derived from 
dispositions of Trust Property, are allocated 80% to the 
Investors and 20% to the Managing Shareholder.  If the Trust 
realizes net losses for the period, the losses are allocated 80% 
to the Investors and 20% to the Managing Shareholder until the 
losses so allocated offset any net profits from prior periods 
allocated to the Shareholders.  Any remaining net losses are 
allocated 99% to the Investors and 1% to the Managing 
Shareholder.  Revenues from dispositions of Trust Property are 
allocated in the same manner as distributions from such 
dispositions.  Amounts allocated to the Investors are apportioned 
among them in proportion to their capital contributions. 

     On liquidation of the Trust, the remaining assets of the 
Trust after discharge of its obligations, including any loans 
owed by the Trust to the Shareholders, will be distributed, 
first, 99% to the Investors and the remaining 1% to the Managing 
Shareholder, until Payout, and any remainder will be distributed 
to the Shareholders in proportion to their capital accounts.

     The Trust did not make any distributions in 1995 to the 
Managing Shareholder (which is a member of the Board of the 
Trust) or any other person and made distributions in 1996 as 
stated at Item 5 - Market for Registrant's Common Equity and 
Related Stockholder Matters.  The Trust paid fees to the Managing 
Shareholder and its affiliates as follows:

Fee                    Paid to        1997         1996     1995

Management fee        Managing
                      Shareholder  $1,154,758   $888,209       $0
Cost reimbursements*   RPMC         3,995,249    337,228        0
Investment fee        Managing
                      Shareholder           0    627,561  304,697
Placement agent fee   Ridgewood
 and sales commis-    Securities
 sions                Corporation           0    315,493  172,674
Organizational,       Managing
 distribution and    Shareholder
 offering fee                               0  1,892,959  954,342

*  These include all payroll, parts, routine maintenance and 
other expenses (except for royalties for landfill gas but 
including an allocation of RPMC overhead) of the Providence 
Project.

     The investment fee equaled 2% of the proceeds of the 
offering of Investor Shares and was payable for the Managing 
Shareholder's services in investigating and evaluating investment 
opportunities and effecting investment transactions.  The 
placement agent fee (1% of the offering proceeds) and sales 
commissions were also paid from proceeds of the offering, as was 
the organizational, distribution and offering fee (5% of offering 
proceeds) for legal, accounting, consulting, filing, printing, 
distribution, selling, closing and organization costs of the 
offering.

     The management fee, payable monthly under the Management 
Agreement at the annual rate of 3% of the Trust's net asset 
value, began on the date the first Project was acquired and 
compensates the Managing Shareholder for certain management, 
administrative and advisory services for the Trust.  In addition 
to the foregoing, the Trust reimbursed the Managing Shareholder 
at cost for expenses and fees of unaffiliated persons engaged by 
the Managing Shareholder for Trust business and for payroll and 
other costs of operation of the Providence and California Pumping 
Projects.  Beginning in 1996, these reimbursements were paid to 
RPMC.  The reimbursements to RPMC, which do not exceed its actual 
costs and allocable overhead, are described at Item 10(g) - 
Directors and Executive Officers of the Registrant -- RPMC.

     Other information in response to this item is reported in 
response to Item 11.  Executive Compensation, which information 
is incorporated by reference into this Item 13.

PART IV

Item 14.  Exhibits, Financial Statement Schedules, and Reports on 
Form 8-K.

 (a)  Financial Statements.

     See the Index to Financial Statements in Item 8 hereof.

 (b)  Reports on Form 8-K.

     No Form 8-K was filed with the Commission by the Registrant 
during the quarter ending December 31, 1997.

     (c)  Exhibits

     3A.  Certificate of Trust of the Registrant is incorporated 
by reference to Exhibit 3A of Registrant's Registration Statement 
filed with the Commission onFebruary 15, 1994.

     3B.  Declaration of Trust of the Registrant is incorporated 
by reference to Exhibit 3B of Registrant's Registration Statement 
filed with the Commission on February 19, 1994.

     3C.  Amendment No. 1 to Declaration of Trust is incorporated 
by reference to Exhibit 3C of Registrant's Annual Report on Form 
10-K for the year ended December 31, 1996.

     10A.  Asset Acquisition Agreement by and among Northeast 
Landfill Power Joint Venture, Northeast Landfill Power Company, 
Johnson Natural Power Corporation and Ridgewood Providence Power 
Partners, L.P. , is incorporated by reference to Exhibit 2 of the 
Registrant's Current Report on Form 8-K filed with the Commission 
on May 2, 1996.

     10B.  Agreement of Merger, dated as of July 1, 1996, by and 
among Consolidated Hydro Maine, Inc., CHI Universal, Inc., 
Consolidated Hydro, Inc., Ridgewood Maine Power Partners, L.P. 
and Ridgewood Maine Hydro Corporation.  Incorporated by reference 
to Exhibit 2.1 of the Registrant's Current Report on Form 8-K 
filed with the Commission on January 8, 1997.

     10C.  Letter, dated November 15, 1996, amending Agreement of 
Merger.  Incorporated by reference to Exhibit 2.2 of Amendment 
No. 1 to the Registrant's Current Report on Form 8-K filed with 
the Commission on January 9, 1997

     10D.  Letter, dated December 3, 1996, amending Agreement of 
Merger.  Incorporated by reference to Exhibit 2.3 of the 
Registrant's Current Report on Form 8-K filed with the Commission 
on January 8, 1997.

     10E.  Operation, Maintenance and Administration Agreement, 
dated November __, 1996, by and among Ridgewood Maine Hydro 
Partners, L.P., CHI Operations, Inc. and Consolidated Hydro, Inc. 
Incorporated by reference to Exhibit 10 of the Registrant's 
Current Report on Form 8-K filed with the Commission on January 
8, 1997.

     10F.  Management Agreement, dated as of __________, 1996, 
between the Registrant and Ridgewood Power Corporation.  
Incorporated by reference to Exhibit 10F of the Registrant's 
Annual Report on Form 10-K for the year ended December 31, 1996.

     10G.  Operation Agreement, dated as of April 16, 1996, among 
the Registrant, Ridgewood Providence Corporation and Ridgewood 
Power Management Corporation.  Incorporated by reference to 
Exhibit 10G of the Registrant's Annual Report on Form 10-K for 
the year ended December 31, 1996

     10H.  Agreement to Purchase Membership Interests, dated 
as of June 11, 1997, by and between Ridgewood Maine, L.L.C. 
and Indeck Maine Energy, L.L.C.  Incorporated by reference to 
Exhibit 2.A. of Amendment No. 1 to Registrant's Current Report on 
Form 8-K dated July 1, 1997.

     10I.  Amended and Restated Operating Agreement of
Indeck Maine Energy, L.L.C., dated as of June 11, 1997. 
Incorporated by reference to Exhibit 2.B. of Amendment No. 1 to 
Registrant's Current Report on Form 8-K dated July 1, 1997.

The Registrant agrees to furnish supplementally a copy of any 
omitted exhibit or schedule to agreements filed as exhibits to 
the Commission upon request.

     21.   Subsidiaries of the Registrant               Page 78

     24.   Powers of Attorney                           Page 79

     27.   Financial Data Schedule                      Page 81

     99.   Listing of Statutory Provisions that the Trust Agrees 
to Comply with.  Incorporated by reference to Exhibit 99 of the 
Registrant's Annual Report on Form 10-K for the year ended 
December 31, 1996.



SIGNATURES

     Pursuant to the requirements of Section 13 or 15(d) of the 
Securities Exchange Act of 1934, the Registrant has duly caused 
this report to be signed on its behalf by the undersigned, 
thereunto duly authorized.

Signature                     Title                          Date



RIDGEWOOD ELECTRIC POWER TRUST IV (Registrant)

By:/s/ Robert E. Swanson    President and Chief    April 15, 1998
       Robert E. Swanson     Executive Officer

        Pursuant to the requirements of the Securities Exchange 
Act of 1934, this report has been signed below by the following 
persons on behalf of the Registrant and in the capacities and on 
the dates indicated.

By:/s/ Robert E. Swanson    President and Chief    April 15, 1998
       Robert E. Swanson     Executive Officer

By:/s/ Martin V. Quinn      Senior Vice President and
       Martin V. Quinn    Chief Financial Officer  April 15, 1998

By:/s/ Kathleen P. McSherry   Controller           April 15, 1998
       Kathleen P. McSherry

RIDGEWOOD POWER CORPORATION  Managing Shareholder  April 15, 1998

By:/s/ Robert E. Swanson    President
       Robert E. Swanson        

 /s/ Robert E. Swanson  *   Independent Trustee    April 15, 1998
       John C. Belknap 

 /s/ Robert E. Swanson  *   Independent Trustee    April 15, 1998
       Richard D. Propper 



  As attorney-in-fact for Independent Trustee



<PAGE>



Ridgewood Electric Power Trust IV

Consolidated Financial Statements

December 31, 1997, 1996 and 1995

























                             -F1-

<PAGE>

Price Waterhouse LLP 1177   Avenue of the Americas   Telephone 212 596 7000
                            New York, NY 10036       Facsimile 212 596 8910
[Letterhead of Price Waterhouse LLP]

Report of Independent Accountants

April 2, 1998

To the Shareholders and Trustees of 
Ridgewood Electric Power Trust IV

In our opinion, the accompanying consolidated balance sheets and the related 
consolidated statements of operations, changes in shareholders' equity and of 
cash flows present fairly, in all material respects, the financial position of 
Ridgewood Electric Power Trust IV at December 31, 1997 and 1996, and the 
results of their operations and their cash flows for each of the two years in 
the period ended December 31, 1997 and the period February 6, 1995 
(commencement of share offering) through December 31, 1995, in conformity with 
generally accepted accounting principles.  These financial statements are the 
responsibility of the Trust's management; our responsibility is to express an 
opinion on these financial statements based on our audits.  We conducted our 
audits of these statements in accordance with generally accepted auditing 
standards which require that we plan and perform the audit to obtain 
reasonable assurance about whether the financial statements are free of 
material misstatement.  An audit includes examining, on a test basis, evidence 
supporting the amounts and disclosures in the financial statements, assessing 
the accounting principles used and significant estimates made by management, 
and evaluating the overall financial statement presentation.  We believe that 
our audits provide a reasonable basis for the opinion expressed above.

As discussed in Notes 1 and 2, effective on October 2, 1996, the shareholders 
of the Trust consented to end its election to be treated as a Business 
Development Corporation under the Investment Company Act of 1940.  As a 
result, generally accepted accounting principles for investment companies no 
longer applied to the Trust and the Trust adopted generally accepted 
accounting principles applicable to operating companies.  The financial 
statements of the Trust have been restated to reflect the application of 
generally accepted accounting principles for operating companies for the 
period from February 6, 1995 (commencement of share offering) to October 2, 
1996.

/s/  Price Waterhouse LLP



                               -F2-

<PAGE>
Ridgewood Electric Power Trust IV
Consolidated Balance Sheet
                                                      December 31,
                                                 1997            1996
                                                                         
Assets:
Cash and cash equivalents               $  11,086,281    $ 22,685,829
Maintenance reserve fund                          ---         394,070
Accounts receivable, trade                    559,764       1,065,181
Other receivables                              97,453         109,999
Due from affiliates                           164,536             ---
Other assets                                  383,810         528,345
               
     Total current assets                  12,291,844      24,783,424
               
Investments:               
Investment in Maine Hydro Projects          6,694,826       6,913,421
Investment in Maine Biomass Projects        6,617,862             ---
Electric power equipment held for resale      455,182         455,182
Deferred due diligence costs                   27,159         245,828

Plant and equipment                        14,949,735      11,889,451
  Less- Accumulated depreciation           (1,068,812)       (357,109)
               
Electric power sales contract               8,338,040       8,338,040
  Less- Accumulated amortization             (946,212)       (390,343)
               
Debt reserve fund                             605,199         575,441
               
Total assets                             $ 47,964,823    $ 52,453,335
               
Liabilities and Shareholders' Equity:               
               
Current maturities of long-term debt     $    592,193    $    538,191
Accounts payable and accrued expenses         384,533         747,960
Due to affiliates                             658,253          92,057
     Total current liabilities              1,634,979       1,378,208
               
Long-term debt, less current portion        4,848,067       5,440,260
Minority interest in the Providence
 Project                                    6,458,416       6,888,268
 

Commitments and contingencies

Shareholders' Equity:               
Shareholders' equity       
 (476.8 shares issued
 and outstanding)                          35,078,194      38,764,199
Managing shareholder's
 accumulated deficit                          (54,833)        (17,600)
     Total shareholders' equity            35,023,361      38,746,599
               
     Total liabilities and
      shareholders' equity               $ 47,964,823    $ 52,453,335

See accompanying notes to the consolidated financial statements.
                                  -F3-

<PAGE>
Ridgewood Electric Power Trust IV
Consolidated Statement of Operations

                                                            Commencement
                                                       of Share Offering
                                                      (February 6, 1995)
                        Year Ended       Year Ended              through
                      December 31,     December 31,         December 31,
                              1997             1996                 1995
                                                                Restated

Net sales             $  6,810,911     $  4,087,722      $          ---
Sublease income            369,000          261,375                 ---
    Total revenue        7,179,911        4,349,047                 ---

Cost of sales,
 including depreciation
 and amortization of
 $1,267,572 and
 $747,452 in 1997
 and 1996                4,879,962        2,991,835                 ---
               
Gross profit             2,299,949        1,357,262                 ---
               
General and
 administrative expenses   505,116          372,415              68,752
Management fee           1,154,758          888,209                 ---
Investment fee                 ---          627,561             304,697
Project due diligence
 costs                     668,554           63,052              50,000
Other expenses              32,255           43,160              31,089
    Total other
     operating expenses  2,360,683        1,994,397             454,538

Loss from operations       (60,734)        (637,135)           (454,538)
               
Other income (expense):               
  Interest income          926,641        1,294,037             298,405
  Interest expense        (572,660)        (394,665)                ---
  Loss from Maine  
   Biomass projects       (680,109)             ---                 ---
  Income from Maine
   Hydro projects          521,710           99,224                 ---
     Other income, net     195,582          998,596             298,405
               
Income (loss) before
 minority interest         134,848          361,461            (156,133)
               
Minority interest
 in the earnings of
 the Providence Project   (537,625)        (288,692)                ---
                
Net income (loss)         (402,777)    $     72,769      $     (156,133)
               

See accompanying notes to the consolidated financial statements.

                                  -F4-

<PAGE>

Ridgewood Electric Power Trust IV
Consolidated Statement Of Changes in Shareholders' Equity
For the Years Ended December 31, 1997 and 1996 and the Period 
February 6, 1995 (inception) to December 31, 1995

                                             Managing     
                         Shareholders       Shareholder          Total

Initial capital
 contributions, net
 (162.1 shares)           $13,658,264      $       ---      $13,658,264
               
Net loss for the period      (154,572)          (1,561)        (156,133)
                     
Shareholders' equity,
 December 31, 1995               
  (162.1 shares)           13,503,692           (1,561)      13,502,131
               
Capital contributions,
 net (314.7 shares)        26,848,394              ---       26,848,394
               
Cash distributions         (1,659,928)         (16,767)      (1,676,695)
                  
Net income for the year        72,041              728           72,769
                  
Shareholders' equity
 December 31, 1996               
 (476.8 shares)           $38,764,199      $   (17,600)     $38,746,599

Cash distributions         (3,287,256)         (33,205)      (3,320,461)

Net loss for the year        (398,749)          (4,028)        (402,777)

Shareholders' equity,
 December 31, 1997
 (476.8 shares)           $35,078,194     $    (54,833)     $35,023,361
 
See accompanying notes to the consolidated financial statements.

                                 -F5-

<PAGE>
Ridgewood Electric Power Trust IV     
Consolidated Statement of Cash Flows

                                                                Commencement
                                                           of Share Offering
                                                          (February 6, 1995)
                            Year Ended       Year Ended              through
                          December 31,     December 31,         December 31,
                                  1997             1996                 1995
  

Cash flows from
 operating activities:
  Net income (loss)         $  (402,777)    $     72,769      $    (156,133)
                  
Adjustments to reconcile
 net income (loss) to net
 cash provided by (used
 in) operating activities:                
  Depreciation and
   amortization               1,267,572          747,452                ---
  Amortization of prepaid
   and accrued royalties-
   net                              ---          777,886                ---
  Minority interest in
   earnings of the
   Providence Project           537,625          288,692                ---
  Income of unconsolidated
   Maine Hydro Projects        (521,710)         (99,224)               ---
  Loss from unconsolidated
   Maine Biomass Projects       680,109              ---                ---
               
Changes in assets and
 liabilities, net of effects
 of Providence Project
 investment:
  Decrease (increase) in
   maintenance reserve fund     394,070          (14,164)               ---
  Decrease (increase) in
   accounts receivable, trade   505,417         (418,433)               ---
  Decrease (increase) in
   other receivables             12,546          (50,535)           (59,464)
  Decrease in customer
   escrow fund                      ---         1,119,115               ---
  (Decrease) increase in
   accounts payable and
   accrued expenses            (363,426)          450,418            34,413
  Increase (decrease) in
   due to/from affiliates,
   net                          401,660          (261,562)              ---
  Other- net                    144,535            76,628               ---
               
     Total adjustments        3,058,398         2,616,273           (25,051)
                  
Net cash provided by (used
 in) operating activities     2,655,621         2,689,042          (181,184)
               
Cash flows from investing
 activities:               
  Investment in the
   Providence Project,
   net of cash
   acquired                         ---        (8,287,184)              ---
  Investment in Maine
   Hydro Projects              (265,953)       (6,814,197)              ---
  Investment in Maine
   Biomass Project           (7,297,971)              ---               ---
  Distributions from
   Maine Hydro Projects       1,006,257               ---               ---
  Capital expenditures       (3,060,284)       (1,928,332)              ---
  Deferred due diligence          
   costs                        218,669          (222,393)          (23,435)
  Purchase of electric
   generating equipment             ---               ---          (455,182)
               
Net cash used in
 investing activities        (9,399,282)      (17,252,106)         (478,617)
               
Cash flows from
 financing activities:               
  Proceeds from
   shareholders'
   contributions                    ---        31,495,223        16,017,470
  Selling commissions
   and offering costs
   paid                             ---        (4,646,829)       (2,359,206)
  Cash distributions
   to shareholders           (3,320,461)       (1,676,695)              ---
  Payments to reduce
   long-term debt              (538,191)         (331,953)              ---
  Increase in debt
   reserve fund                 (29,758)          (58,677)              ---
  Distributions to
   minority interest           (967,477)         (530,639)              ---
               
     Net cash (used in)
      provided by
      financing
      activities             (4,855,887)       24,250,430        13,658,264
               
Net (decrease) increase
 in cash and cash
 equivalents                (11,599,548)        9,687,366        12,998,463
               
Cash and cash
 equivalents,
 beginning of period         22,685,829        12,998,463               ---
               
Cash and cash
 equivalents,
 end of period              $11,086,281     $  22,685,829     $  12,998,463


See accompanying notes to the consolidated financial statements.

                                   -F6-

<PAGE>
Ridgewood Electric Power Trust IV
Notes to the Consolidated Financial Statements

1.  Organization and Purpose

Nature of Business

     Ridgewood Electric Power Trust IV (the "Trust") was formed as a Delaware 
business trust in September 1994 by Ridgewood Energy Holding Corporation 
acting as the Corporate Trustee.  The managing shareholder of the Trust is 
Ridgewood Power Corporation.  The Trust began offering shares on February 6, 
1995 and discontinued its offering of shares in March 1996.

     The Trust has been organized to invest in independent power generation 
facilities and in the development of these facilities. These independent power 
generation facilities will include cogeneration facilities, which produce both 
electricity and heat energy and other power plants that use various fuel 
sources (except nuclear).  The power plants will sell electricity and, in some 
cases, heat energy to utilities and industrial users under long-term 
contracts.

Business Development Company Election

     The Trust initially made an election to be treated as a Business 
Development Company ("BDC") under the Investment Company Act of 1940 ("the 
1940 Act").  On January 24, 1995, the Trust notified the Securities Exchange 
Commission of such election and registered its shares under the Securities 
Exchange Act of 1934 ("the 1934 Act").  On March 24, 1995, the election and 
registration became effective.

     On September 9, 1996, through a proxy solicitation the Trust requested 
investor consent to end the BDC status.  As of October 2, 1996, more than 50% 
of the investors shares consented to the elimination of the BDC status.  
Accordingly, the Trust is no longer an investment company under the 1940 Act.

2.  Summary of Significant Accounting Policies

Accounting changes

     As a BDC under the 1940 Act, the Trust utilized generally accepted 
accounting principles for investment companies.  As a result of the 
elimination of the BDC status, the Trust now utilizes generally accepted 
accounting principles for operating companies.  In accordance with the 
generally accepted accounting principles for BDCs, investments in power 
generation projects were stated at fair value in previously issued financial 
statements.  As a result of the elimination of the BDC status, consolidation 
and equity method accounting principles now apply to the accounting for 
investments.  Accordingly, the financial data for the period from February 6, 
1995 to December 31, 1995 has been restated to reflect the use of 
consolidation and equity method accounting principles.  Because the Trust did 
not invest in projects until 1996, the restatement had no impact on net income 
or stockholders' equity.

Principles of consolidation and accounting for investment in power generation 
projects

     The consolidated financial statements include the accounts of the Trust 
and affiliates owned more than 50%.  All material intercompany transactions 
have been eliminated.
                                   -F7-

<PAGE>
Ridgewood Electric Power Trust IV
Notes to the Consolidated Financial Statements

     The Trust uses the equity method of accounting for its investments in 
affiliates which are 50% owned because the Trust has the ability to exercise 
significant influence over the operating and financial policies of the 
affiliate but does not control the affiliate.  The Trust's share of the 
earnings of the affiliates is included in the consolidated results of 
operations.

Use of estimates

     The preparation of consolidated financial statements in conformity with 
generally accepted accounting principles requires management to make estimates 
and assumptions that affect the reported amounts of assets and liabilities, 
and disclosure of contingent assets and liabilities at the date of the 
financial statements and the reported amounts of revenues and expenses during 
the reporting period.  Actual results could differ from the estimates.

Cash and cash equivalents

     The Trust considers all highly liquid investments with maturities when 
purchased of three months or less as cash and cash equivalents.

Plant and equipment

     Plant and equipment, consisting principally of electrical generating 
equipment, is stated at cost.  Renewals and betterments that increase the 
useful lives of the assets are capitalized.  Repair and maintenance 
expenditures that increase the efficiency of the assets are expensed as 
incurred.  The Trust periodically assesses the recoverability of plant and 
equipment, and other long-term assets, based on their estimated future cash 
flows.

     Depreciation is recorded using the straight-line method over the useful 
lives of the assets, which is 10 to 20 years.  During 1997 and 1996, the Trust 
recorded depreciation expense of $711,703 and $357,109, respectively.

Intangible asset

     A portion of the purchase price of the Providence Project was assigned to 
the Electric Power Sales Contract and is being amortized over the life of the 
asset (15 years) on a straight-line basis.  During 1997 and 1996, the Trust 
recorded amortization expense of $555,869 and $390,343, respectively.

Electric power equipment held for resale

     The Trust owns certain used electric power equipment that is stated at 
cost, which approximates estimated net realizable value.

Revenue recognition

     Power generation revenue is recognized based on power delivered at rates 
stipulated in the power sales contract.  Interest and dividend income is 
recorded when earned.


                                   -F8-

 <PAGE>
Ridgewood Electric Power Trust IV
Notes to the Consolidated Financial Statements

In come taxes

     No provision is made for income taxes in the accompanying financial 
statements as the income or losses of the Trust are passed through and 
included in the tax returns of the individual shareholders of the Trust.

Offering costs 

     Costs associated with offering Trust shares (selling commissions, 
distribution and offering costs) are reflected as a reduction of the 
shareholders' capital contributions.  

Due diligence costs relating to potential power projects

     Costs relating to the due diligence performed on potential power project 
investments are initially deferred, until such time as the Trust determines 
whether or not it will make an investment in the project.  Costs relating to 
completed projects are capitalized and costs relating to rejected projects are 
expensed at the time of rejection.

3.  Investments

     The Trust has the following investments in power generation projects and 
electric power equipment:



                      Nature of   Ownership            December 31,
Project Name          Ownership    Interest         1997         1996

Consolidated:
Providence Project    Partnerships    64.3%  $11,632,385  $12,411,572

California Pumping 
 Project              Direct  
                      Ownership      100.0%      648,176      687,733
Electric Power 
 Equipment            Direct 
                      Ownership      100.0%      455,182      455,182

Equity method:
Maine Hydro 
 Projects             Partnerships    50.0%   $6,694,826   $6,913,421

Maine Biomass 
 Projects             Limited
                      Liability
                      Companies       50.0%    6,617,862          ---

Providence Project

     In 1996, Ridgewood Providence Power Partners, L.P. was formed as a 
Delaware limited partnership ("Providence Power").  The Trust invested 
$12,721,500 and owns a 64.3% limited partnership interest in Providence Power. 

                                   -F9-

<PAGE>
Ridgewood Electric Power Trust IV
Notes to the Consolidated Financial Statements

In addition, Ridgewood Providence Power Corporation, was formed as a Delaware 
corporation ("RPPCorp.").  The Trust invested $128,500 and owns 64.3% of the 
outstanding common stock of RPPCorp., which is the sole general partner of  
Providence Power. 

     On April 16, 1996, Providence Power purchased substantially all of the 
net assets of Northeastern Landfill Power Joint Venture.  The assets acquired 
include a 12.3 megawatt capacity electrical generating station, located at the 
Central Landfill in Johnston, Rhode Island (the "Providence Project").  In 
1997, the capacity was increased to 13.8 megawatts.  The Providence Project 
includes nine reciprocating electric generator engines, which are fueled by 
methane gas produced and collected from the landfill.  The electricity 
generated is sold to New England Power Corporation under a long-term contract.  
The purchase price was $15,533,021 in cash, including transaction costs and 
repayment of $3,000,000 of principal on the senior secured non-recourse notes 
payable.  In addition, Providence Power assumed the obligation to repay the 
remaining principal outstanding of $6,310,404 on the senior secured non-
recourse notes payable.

     Through ownership in RPPCorp. and Providence Power, the Trust owns 64.3% 
of the Providence Project.  The remaining 35.7% is owned by Ridgewood Electric 
Power Trust III ("Trust III").  Ridgewood Power Corporation is the managing 
partner of the Trust and Trust III.

     The acquisition of the Providence Project was accounted for as a purchase 
as of April 16, 1996, and the results of operations of the Providence Project 
have been included in the Trust's Consolidated Financial Statements since that 
date.  The purchase price was allocated to the net assets acquired, based on 
their respective fair values.  Of the purchase price, $8,338,040 was allocated 
to the Electric Power Sales Contract and is being amortized over 15 years.

     The following unaudited pro forma information has been prepared assuming 
the Providence Project was acquired as of the beginning of the periods 
presented.  The pro forma information is presented for information purposes 
only and is not necessarily indicative of what would have occurred if the 
formation and acquisition had been made as of those dates.  In addition, the 
pro forma information is not intended to be a projection of future results and 
does not reflect capital equipment additions and changes in operating 
management which have been made at the Providence Project subsequent to the 
acquisition.


                                    Pro Forma Information
                                         (Unaudited)
                                  1996                  1995

Net sales                   $5,511,642            $4,146,000
Income from operations       1,032,806               712,975
Net income (loss)               88,558               (28,696)

California Pumping Project

     On December 31, 1995, the Trust acquired a package of natural gas fueled 
diesel engines which drive deep irrigation well pumps in Ventura County, 
California from an affiliated trust.  The engines' shaft horsepower-hours are 

                                    -F10-

<PAGE>
Ridgewood Electric Power Trust IV
Notes to the Consolidated Financial Statements

sold to the operator at a discount from the equivalent kilowatt hours of 
electricity.  The Trust receives a distribution of $0.02 per equivalent 
kilowatt up to 3,000 running hours per year and $0.01 per equivalent kilowatt 
for each additional running hour per year. The operator pays for fuel, 
maintenance, repair and replacement. The initial acquisition included 11 
engines with a rated capacity of 1.2 megawatts.  The purchase price of 
$353,619 was paid in 1996.  During 1996, the Trust acquired an additional 9 
engines with a rated capacity of 1.2 megawatts at a purchase price of 
$344,111.  At December 31, 1997 and 1996, the Trusts total investment in the 
California Pumping Project was $697,730.

Electric Power Equipment Held for Resale

     The Trust purchased, from an affiliated entity, various used electric 
power generation equipment to be held for resale or, in the event a buyer is 
not found, for use in potential power generation projects.  The equipment is 
held in storage.  At December 31, 1997 and 1996, the cost of such equipment 
was $455,182.

Maine Hydro Projects

     On September 5, 1996, Ridgewood Maine Hydro Partners, L.P. was formed as 
a Delaware limited partnership ("Ridgewood Hydro L.P.").  The Trust made 
investments totaling $6,748,256 and owns a 50% limited partnership interest in 
Ridgewood Hydro L.P.  In addition, Ridgewood Maine Hydro Corporation, was 
formed as a Delaware corporation ("RMHCorp.").  The Trust invested $65,941 and 
owns 50% of the outstanding common stock of RMHCorp., which is the sole 
general partner of Ridgewood Hydro L.P. 

     On December 23, 1996, in a merger transaction, Ridgewood Hydro L.P. 
acquired 14 hydroelectric projects, located in Maine (the "Maine Hydro 
Projects"), from a subsidiary of Consolidated Hydro, Inc.  The assets acquired 
include a total of 11.3 megawatts of electrical generating capacity.  The 
electricity generated is sold to Central Maine Power Company and Bangor Hydro 
Company under  long-term contracts.  The purchase price was $13,628,395 cash, 
including transaction costs.  In addition, Ridgewood Hydro L.P. assumed a 
long-term lease obligation of $1,004,679.  The Trust's 50% share of the cash 
consideration paid was $6,814,198. The remaining 50% was paid by Ridgewood 
Electric Power Trust V ("Trust V").  Ridgewood Power Corporation is the 
managing partner of the Trust and Trust V.

     The Trust's 50% investment in the Maine Hydro Projects is accounted for 
under the equity method of accounting.  The Trust's equity in the earnings of 
the Maine Hydro Projects has been included in the Consolidated Financial 
Statements since December 23, 1996.

     The Maine Hydro Projects are operated by a subsidiary of Consolidated 
Hydro, Inc., under an Operation, Maintenance and Administrative Agreement.  
The annual operator's fee is $307,500, adjusted for inflation, plus an annual 
incentive fee equal to 50% of the net cash flow in excess of a target amount.  
The Maine Hydro Projects recorded $429,430 and $3,070 of expense under this 
arrangement during the periods ended December 31, 1997 and 1996, respectively.  
The agreement has a five year term and can be renewed for two additional five 
year terms by mutual consent.

                                       F11-


<PAGE>
Ridgewood Electric Power Trust IV
Notes to the Consolidated Financial Statements

     Summarized financial information for the Maine Hydro Prjects are as 
follows:

Balance Sheet Information

                              December 31, 1997        December 31, 1996
Current assets                     $  1,757,908             $  2,115,375
Electric power sales contract        12,225,765               13,286,920
Other non-current assets                634,952                  800,000
  
Total assets                       $ 14,618,625             $ 16,202,295


Current liabilities                 $   291,911            $   1,370,774
Non-current liabilities                 937,062                1,004,679
Partners' equity                     13,389,652               13,826,842
Total liabilities and equity       $ 14,618,625             $ 16,202,295

Statement of Operations Information

                                                            For the Period
                                                         September 5, 1996
                           For The Year Ended          (date of inception)
                            December 31, 1997          To December 31, 1996

Revenue                         $4,113,065                      $192,152
Operating expenses               2,952,589                        50,340
Net income                       1,043,420                       198,447

Maine Biomass Projects

     On July 1, 1997, through a subsidiary, the Trust purchased a preferred 
membership interest in Indeck Maine Energy, L.L.C. ("Maine Biomass Projects"), 
which owns two electric power generating stations fueled by waste wood.  The 
aggregate purchase price was $7,297,971 and includes transaction costs of 
$297,971.  Each project has 24.5 megawatts of electrical generating capacity.  
The Penobscot project is located in West Enfield, Maine and the Eastport 
project is located in Jonesboro, Maine.  The Maine Biomass Projects had a 
power sales contract with the New England Power Pool, which expired on August 
31, 1997.  The facilities were shut down in September 1997 and were 
reactivated in November 1997 to sell capacity and energy to Bangor Hydro-
Electric Company, a local utility ("BHC") on a month-to-month basis.  The 
facilities were again shut down in January 1998.  The cost of maintaining the 
idled facilities in good condition is approximately $100,000 per month.

     The preferred membership interest entitles the Trust to receive an 18% 
cumulative annual return on its $7,000,000 capital contribution to the Maine 
Biomass Projects from the operating net cash flow from the projects.  Trust V 
also purchased an identical preferred membership interest in the Maine Biomass 
Projects.  After payments in full to the preferred membership interests, up to 
$2,500,000 of any remaining cash flow during the year is paid to the other the 
Maine Biomass Projects members.  Any remaining operating net cash flow is 
payable 25% to the Trust and Trust V and 75% to the other the Maine Biomass 
Projects members.

                                    -F12-

<PAGE>
Ridgewood Electric Power Trust IV
Notes to the Consolidated Financial Statements


     The Trust's investment in the Maine Biomass Projects is accounted for 
under the equity method of accounting.  The Trust's equity in the loss of the 
Maine Biomass Projects for the period July 1, 1997 to December 31, 1997 was 
$680,109.

     The Penobscot and Eastport projects are operated by Indeck Operations, 
Inc., an affiliate of the other members of Indeck Maine under a management 
agreement.  The annual operator's fee is $300,000, of which $200,000 is 
payable contingent upon the Trusts receiving their cumulative annual return.  
The management agreement has a form of one year and automatically continues 
for successive one year terms unless canceled by either the Maine Biomass 
Projects or Indeck Operations, Inc.  The Trusts can also cancel the contract 
effective December 31, 1998 if certain preferred membership interest payments 
have not been made.

     Summarized financial information for the Maine Biomass Projects is as 
follows:

Balance Sheet Information at December 31, 1997

Current assets        $  861,677     Current liabilities      $  912,683
Non-current assets     3,524,356     Members' equity           3,473,350
Total assets        $  4,386,033     Total liabilities and
                                      equity                  $4,386,033

Statement of Operations Information for the Period July 1, 1997 (date of 
acquisition) to December 31, 1997

Revenue                           $  2,991,793
Operating expenses                   4,276,373
Depreciation & Amortization            100,085
Net loss                          $ (1,384,665)

4.  Long-term Debt

     Following is a summary of long-term debt at December 31, 1997:

Senior secured non-recourse notes payable      $5,440,260
Less - Current maturity                          (592,193)
Total long-term debt                           $4,848,067

     The senior secured non-recourse notes are due in monthly installments of 
$90,738 including interest at 9.6%.  Final payment is due on October 15, 2004.  
The notes also provide for additional interest equal to 5% of the annual net 
cash flow of the Providence Project, as defined.  No additional interest was 
due for the year ended December 31, 1997 or for the eight and one half months 
ending December 31, 1996.  The notes are secured by a leasehold mortgage on 
Providence Power's landfill lease agreements and substantially all of the 
assets of Providence Power.  In addition to the required monthly payments, 
mandatory prepayments may be required if certain events occur.  The loan 
agreement also provides for a cash funded debt service reserve and maintenance 
reserve.  At December 31, 1997 and 1996, the cash balance in these reserve 
accounts was $605,199 and $575,441, respectively.  Additions and reductions to 

                                    -F13-

<PAGE>
Ridgewood Electric Power Trust IV
Notes to the Consolidated Financial Statements

these reserve accounts are defined in the loan agreement.  As of January 31, 
1997, Providence Power's obligations to maintain a cash balance in the 
maintenance reserve account terminated and the cash balance in the reserve 
account was released to Providence Power.  The loan agreement contains various 
covenants, including the maintenance of a specified debt service ratio.

     Scheduled repayments of long-term debt principal for the next five years 
are as follows:

                        Year Ended
                      December 31,          Repayment

                          1998              $592,193
                          1999               651,613
                          2000               716,995
                          2001               788,937
                          2002               868,098

     During the fourth quarter of 1997, the Trust and its principal bank 
executed a revolving line of credit agreement, whereby the bank will provide a 
three year committed line of credit facility of $1,150,000.  At December 31, 
1997, there were no borrowings outstanding under the credit facility.  
Outstanding borrowing bear interest at the bank's prime rate or, at the 
Trust's choice, at LIBOR plus 2.5%.  The credit agreement will require the 
Trust to maintain a ratio of total debt to tangible net worth of no more than 
1 to 1 and a minimum debt service coverage ratio of 2 to 1.

5.  Fair Value of Financial Instruments

     At December 31, 1997, the carrying value of the Trust's cash, accounts 
receivable, debt service reserve fund and accounts payable approximates their 
fair value.  The fair value of the long-term debt, calculated using current 
rates for loans with similar maturities, also approximates its carrying value.

6.  Electric Power Sales Contracts

     Providence Power is committed to sell all of the electricity it produces 
to New England Power Company ("NEP") for prices as specified in the Power 
Purchase Agreement.  The prices are adjusted annually for changes in the 
Consumer Price Index, as defined.  The NEP agreement expires in the year 2020 
and can be terminated by either party under certain conditions in 2010.  At 
the time of the acquisition of the Providence Project, Providence Power was 
required under the NEP agreement to maintain in an escrow account cash to 
secure payment to NEP in the event of default.  At April 16, 1996, the 
required escrow balance amounted to $1,065,989.  In October 1996, the required 
escrow balance decreased to zero and the cash held in escrow was released to 
Providence Power.  For the year ended December 31, 1997 and the eight and one 
half months ended December 31, 1996, sales revenue under the NEP Power 
Purchase Agreement amounted to $6,458,648 and $3,946,077, respectively.

     The Maine Hydro Projects qualify as small power production facilities 
under the Public Utility Regulatory Policies Act ("PURPA").  PURPA requires 
that each electric utility company, operating at the location of a small power 
production facility, as defined, purchase the electricity generated by such 
facility at a specified or negotiated price.  The Maine Hydro Projects sell 

                                    -F14-

<PAGE>
Ridgewood Electric Power Trust IV
Notes to the Consolidated Financial Statements

substantially all of their electrical output to two public utility companies, 
Central Maine Power Company ("CMP") and Bangor Hydro-Electric Company ("BHC"), 
under long-term power purchase agreements.  Eleven of the twelve power 
purchase agreements with CMP expire in December 2008 and are renewable for an 
additional five year period.  The twelfth power purchase agreement with CMP 
expires in December 2007 with CMP having the option to extend the contract for 
three more five-year periods.  The two power purchase agreements with BHC 
expire in December 2014 and February 2017.

7.  Landfill Lease and Sublease 

     Providence Power leases the Central Landfill, located in Johnston, Rhode 
Island from Rhode Island Solid Waste Management Corporation ("RISWMC").  The 
lease expires in 2020 and can be extended for an additional 10 years.  This 
operating lease requires Providence Power to pay a royalty equal to 15% of net 
revenues, as defined, for the first 15 years of the lease.  For subsequent 
years, the royalty is 15% of net revenues for each month in which the average 
daily kilowatt hour production is less than 180,000 and 18% of net revenues 
for each month in which the average daily kilowatt hour production exceeds 
180,000.  At the time of the acquisition of the Providence Project, Providence 
Power made a royalty prepayment to RISWMC of $925,000.  For the year ended 
December 31, 1997 and the eight and one half months ended December 31, 1996, 
royalty expense relating to the RISWMC lease amounted to $951,767 and 
$588,456, respectively.

     Providence Power subleases the Central Landfill to Central Gas Limited 
Partnership ("Gasco"). Gasco operates and maintains the landfill gas 
collection system and supplies landfill gas to the Providence Project.  The 
sublease agreement is effective through December 31, 2010 and provides for the 
following:

     1.  Sublease Income - Gasco is to pay Providence Power an annual amount 
equal to the product of $30,000 times the assumed output capacity of each 
engine generator set in megawatts installed and operating by the joint 
venture.  Income recorded under the sublease amounted to $369,000 and $261,375 
for the year ended December 31, 1997 and eight and one half months ended 
December 31, 1996, respectively.

     2.  Fuel Expense - Providence Power agreed to purchase all the landfill 
gas produced by Gasco and pay on a monthly basis $.01183 per kilowatt hour for 
the first 4,000,000 kilowatt hours, $.005 per kilowatt hour for kilowatt hours 
in excess of 4,000,000 and $.05 per million BTU's of excess landfill gas.  The 
price is adjusted annually for changes in the Consumer Price Index, as 
defined.  Purchases from Gasco for the year ended December 31, 1997 and the 
eight and one half months ended December 31, 1996, amounted to $863,536 and 
$555,447, respectively.

8.  Transactions With Managing Shareholder and Affiliates

     The Trust pays to the managing shareholder a distribution and offering 
fee up to 6% of each capital contribution made to the Trust.  This fee is 
intended to cover legal, accounting, consulting, filing, printing, 
distribution, selling and closing costs for the offering of  the Trust.  For 

                                     -F15-

<PAGE>
Ridgewood Electric Power Trust IV
Notes to the Consolidated Financial Statements

the period ended December 31, 1996 and 1995, the Trust paid fees for these 
services to the managing shareholder of $1,892,959 and $954,342, respectively.  
These fees were recorded as a reduction in the shareholders' capital 
contribution.

     The Trust also pays to the managing shareholder an investment fee up to 
2% of each capital contribution made to the Trust.  The fee is payable to the 
managing shareholder for its services in investigating and evaluating 
investment opportunities and effecting transactions for investing the capital 
of the Trust. For the periods ended December 31, 1996 and 1995, the Trust paid 
investment fees to the managing shareholder of $627,561 and $304,697, 
respectively.

     The Trust entered into a management agreement with the managing 
shareholder under which the managing shareholder renders certain management, 
administrative and advisory services and provides office space and other 
facilities to the Trust. As compensation to the managing shareholder, the 
Trust pays the managing shareholder an annual management fee equal to 3% of 
the net asset value of the Trust payable monthly upon the closing of the 
Trust.  For the year ended December 31, 1997 and 1996, the Trust paid an 
annual management fees to the managing shareholder of $1,154,758 and $888,209, 
respectively.

     Under the Declaration of Trust, the managing shareholder is entitled to 
receive each year 1% of all distributions made by the Trust (other than those 
derived from the disposition of Trust property) until the shareholders have 
been distributed each year an amount equal to 14% of their equity 
contribution.  Thereafter, the managing shareholder is entitled to receive 20% 
of the distributions for the remainder of the year.  The managing shareholder 
is entitled to receive 1% of the proceeds from dispositions of Trust 
properties until the shareholders have received cumulative distributions equal 
to their original investment ("Payout").  After Payout, the managing 
shareholder is entitled to receive 20% of all remaining distributions of the 
Trust.

     Where permitted, in the event the managing shareholder or an affiliate 
performs brokering services in respect of an investment acquisition or 
disposition opportunity for the Trust, the managing shareholder or such 
affiliate may charge the Trust a brokerage fee.  Such fee may not exceed 2% of 
the gross proceeds of any such acquisition or disposition.  No such fees have 
been paid through December 31, 1997.

     The managing shareholder purchased one share of the Trust for $83,000 in 
1995.  Through December 31, 1997, commissions and placement fees of $172,674 
were earned by Ridgewood Securities Corporation, an affiliate of the managing 
shareholder.

     Under an Operating Agreement with the Trust, Ridgewood Power Management 
Corporation ("Ridgewood Management"), an entity related to the managing 
shareholder through common ownership, provides management, purchasing, 
engineering, planning and administrative services to the Trust's power 
generation projects.  Ridgewood Management charges the projects at its cost 
for these services and for the allocable amount of certain overhead items.  
Allocations of costs are on the basis of identifiable direct costs, time 
records or in proportion to amount invested in projects managed by Ridgewood 

                                    -F16-
<PAGE>
Ridgewood Electric Power Trust IV
Notes to the Consolidated Financial Statements

Management.  During the year ended December 31, 1997 and the eight and one 
half months ended December 31, 1996, Ridgewood Management charged Providence 
Power $467,881 and $337,228, respectively.  During the periods ended December 
31, 1997 and 1996, Ridgewood Management did not charge any amounts to the 
Maine Hydro projects or the Maine Biomass projects.





















                                -F17-
Exhibit 21 - Subsidiaries of the Registrant

Subsidiary corporations serving as general partners or managers 
of limited liability entities are listed with those entities.


<TABLE>

<CAPTION>

Name of Subsidiary                        Type of entity      Jurisdiction of
                                                                organization

<S>                                          
<C>                      
<C>
Ridgewood/Providence Power Partners, L.P.  limited partnership      Delaware
Ridgewood/Providence Corporation           corporation              Delaware

Ridgewood/Maine Hydro Partners, L.P.       limited partnership      Delaware*
Ridgewood Maine Hydro Corporation          corporation              Delaware*

Ridgewood Pump Services Partners IV, L.P.  limited partnership      Delaware
Ridgewood Pump Services IV Corporation     corporation              Delaware

Ridgewood Maine, L.L.C.                    limited liability co.    Delaware*

*50% owned by Registrant and 50% owned by Ridgewood Power V.

</TABLE>


EXHIBIT 24 -- POWERS OF ATTORNEY

POWER OF ATTORNEY


	KNOW ALL PERSONS BY THESE PRESENTS, that the undersigned, 
John Belknap, appoints Robert E. Swanson and Martin V. Quinn, and 
each of them, as his true and lawful attorneys-in-fact with full 
power to act and do all things necessary, advisable or 
appropriate, in their discretion, to execute on his behalf as an 
Independent Trustee of Ridgewood Electric Power Trust I and of  
Ridgewood Electric Power Trust IV, the Annual Reports on Form 10-
K for the year ended December 31, 1997 for each of the above-
named trusts, and all amendments or documents relating thereto.

	IN WITNESS WHEREOF, the undersigned has executed this Power 
of Attorney this 30th day of March, 1998, at Fort Lauderdale, 
Florida.

					    /s/John Belknap
						John Belknap


<PAGE>
POWER OF ATTORNEY


	KNOW ALL PERSONS BY THESE PRESENTS, that the undersigned, 
Richard Propper, M.D., appoints Robert E. Swanson and Martin V. 
Quinn, and each of them, as his true and lawful attorneys-in-fact 
with full power to act and do all things necessary, advisable or 
appropriate, in their discretion, to execute on his behalf as an 
Independent Trustee of Ridgewood Electric Power Trust I and of  
Ridgewood Electric Power Trust IV, the Annual Reports on Form 10-
K for the year ended December 31, 1997 for each of the above-
named trusts, and all amendments or documents relating thereto.

	IN WITNESS WHEREOF, the undersigned has executed this Power 
of Attorney this 30th day of March, 1998, at Fort Lauderdale, 
Florida.

					     /s/Richard Propper, M.D.
						Richard Propper, M.D.


<TABLE> <S> <C>

<ARTICLE> 5
<LEGEND>This schedule contains summary financial information 
extracted from the Registrant's audited interim financial 
statements for the year ended December 31, 1997 and is qualified 
in its entirety by reference to those financial statements.
</LEGEND>
<CIK> 0000930364
<NAME> RIDGEWOOD ELECTRIC POWER TRUST IV
       
<S>                             <C>                   
<PERIOD-TYPE>                   YEAR
<FISCAL-YEAR-END>                          DEC-31-1997
<PERIOD-END>                               DEC-31-1997
<CASH>                                      11,086,281
<SECURITIES>                                13,312,688<F1>
<RECEIVABLES>                                  657,217
<ALLOWANCES>                                         0
<INVENTORY>                                          0
<CURRENT-ASSETS>                            12,291,844<F2>
<PP&E>                                      14,949,735
<DEPRECIATION>                              (1,068,812)
<TOTAL-ASSETS>                              47,964,823
<CURRENT-LIABILITIES>                        1,634,979<F3>
<BONDS>                                      4,848,067
                                0
                                          0
<COMMON>                                             0
<OTHER-SE>                                  35,023,361<F4>
<TOTAL-LIABILITY-AND-EQUITY>                47,964,823
<SALES>                                      6,810,911
<TOTAL-REVENUES>                             7,179,911
<CGS>                                        4,879,962
<TOTAL-COSTS>                                4,879,962
<OTHER-EXPENSES>                             2,898,308<F5>
<LOSS-PROVISION>                                     0
<INTEREST-EXPENSE>                             572,660
<INCOME-PRETAX>                               (402,777)
<INCOME-TAX>                                         0
<INCOME-CONTINUING>                           (402,777)
<DISCONTINUED>                                       0
<EXTRAORDINARY>                                      0
<CHANGES>                                            0
<NET-INCOME>                                  (402,777)
<EPS-PRIMARY>                                     (845)
<EPS-DILUTED>                                     (845)

<FN>
<F1>Investment in power project partnership and limited liability 
company accounted for on equity basis.
<F2>Includes $164,536 due from affiliates.
<F3>Includes $658,253 due to affiliates.
<F4>Represents Investor Shares of beneficial interest in Trust 
with capital accounts of $35,078,194 less managing shareholder's 
accumulated deficit of $54,833.
<F5>Includes minority interest in earnings of project.
</FN>
        

</TABLE>



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