CH ENERGY GROUP, INC. SUPPLEMENTAL EXECUTIVE RETIREMENT PLAN

                                                             Exhibit 10(iii)(40)

                                                                       CORRECTED
                                                                  MARCH 31, 2006

                              CH ENERGY GROUP, INC.

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

                              CH ENERGY GROUP, INC.
                     SUPPLEMENTAL EXECUTIVE RETIREMENT PLAN

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

                            Effective January 1, 2006

<PAGE>

                              CH ENERGY GROUP, INC.
                     SUPPLEMENTAL EXECUTIVE RETIREMENT PLAN
                           (Effective January 1, 2006)

                                TABLE OF CONTENTS

ARTICLE I NAME, PURPOSE, LEGAL STATUS.........................................2

ARTICLE II GENERAL DEFINITIONS................................................3

ARTICLE III PARTICIPATION.....................................................5

ARTICLE IV SERP ACCRUED BENEFIT...............................................6

ARTICLE V VESTING.............................................................8

ARTICLE VI NORMAL RETIREMENT BENEFIT..........................................9

ARTICLE VII EARLY RETIREMENT BENEFIT.........................................11

ARTICLE VIII EFFECT OF DEATH AND DISABILITY ON BENEFITS......................13

ARTICLE IX SPECIAL PROVISIONS................................................14

ARTICLE X ADMINISTRATION AND FINANCING.......................................18

ARTICLE XI AMENDMENT AND TERMINATION.........................................20

ARTICLE XII MISCELLANEOUS....................................................21

<PAGE>

                                    ARTICLE I
                           NAME, PURPOSE, LEGAL STATUS

1.1   Name.  The plan  hereunder  shall be known as the CH  Energy  Group,  Inc.
      Supplemental  Executive  Retirement  Plan  (the  "Plan"),  which  shall be
      effective January 1, 2006 (the "Effective Date").

1.2   Purpose.  The  purpose of the Plan is to provide  supplemental  retirement
      benefits  for  eligible   executives  of  the  Company  and  Participating
      Affiliates.

1.3   Legal  Status.  The Company  intends  the Plan to be an unfunded  deferred
      compensation  plan for a select group of management or highly  compensated
      employees,  within the meaning of Sections 201(2), 301(a)(3) and 401(a)(1)
      of ERISA.

1.4   Compliance  with Section 409A. The Company intends the Plan to comply with
      the provisions of Section 409A of the Code, so as to prevent the inclusion
      in gross income of any amounts  deferred  hereunder in a taxable year that
      is  prior  to the  taxable  year or years  in  which  such  amounts  would
      otherwise  actually be distributed or made  available to  Participants  or
      beneficiaries. This Plan shall be construed, administered, and governed in
      a manner that effects such intent,  and the  Committee  shall not take any
      action that would be  inconsistent  with such intent.  Any provisions that
      would cause any amount deferred or payable under the Plan to be includible
      in the gross  income  of any  Participant  or  beneficiary  under  Section
      409A(a)(1)  of the Code shall  have no force and  effect  unless and until
      amended to cause such amount to not be so includible  (which amendment may
      be retroactive to the extent  permitted by Section 409A of the Code).  Any
      reference  in this Plan to Section 409A of the Code shall also include any
      proposed,   temporary  or  final  regulations,   or  any  other  guidance,
      promulgated  with respect to such Section 409A by the U.S.  Department  of
      Treasury or the Internal Revenue Service.


                                      -2-
<PAGE>

                                   ARTICLE II
                               GENERAL DEFINITIONS

2.1   "Affiliate"  means a member of the Company's  Controlled  Group within the
      meaning of Section 1.8 of the Pension  Plan,  or any  successor  provision
      thereto.

2.2   "Board" means the Board of Directors of the Company.

2.3   "Change in Control"  means the  transactions  or events defined in Section
      9.3.

2.4   "Code" means the Internal Revenue Code of 1986, as amended.

2.5   "Committee" means the Compensation  Committee of the Board or its delegate
      as provided in Section 10.1.

2.6   "Company"  means CH Energy  Group,  Inc., a New York  corporation,  or any
      corporate successor thereto.

2.7   "ERISA"  means the Employee  Retirement  Income  Security Act of 1974,  as
      amended.

2.8   "Effective  Date"  means the  effective  date of the Plan,  which  date is
      January 1, 2006.

2.9   "Earliest Retirement Date" means the date provided in Section 7.2.

2.10  "Employee"  means a common law  employee of the Company,  a  Participating
      Affiliate or other Affiliate.

2.11  "Eligible  Executive"  means an Employee  who is described in Section 3.4,
      provided  the  Employee  is a member of a select  group of  management  or
      highly  compensated  employees  within  the  meaning of  Sections  201(2),
      301(a)(3) and 401(a) of ERISA.

2.12  "Normal Retirement Date" means the date described in Section 6.2.

2.13  "Participant" means an Eligible Executive who becomes a Participant in the
      Plan under Section 3.1.

2.14  "Participating Affiliate" means an Affiliate that adopts the Plan with the
      consent of the Company.

2.15  "Pension  Plan" means the  Retirement  Income Plan of Central Hudson Gas &
      Electric Corporation.

2.16  "Plan" means this CH Energy Group, Inc. Supplemental  Executive Retirement
      Plan, and any amendment thereto.

2.17  "Restoration  Plan"  means the Central  Hudson Gas & Electric  Corporation
      Retirement Benefit Restoration Plan.

2.18  "SERP Accrued Benefit" means the amount determined under Section 4.1.


                                      -3-
<PAGE>

2.19  "SRP" means the CH Energy Group, Inc. Supplementary Retirement Plan.

2.20  "Termination  of  Employment"  means  the  termination  of  an  Employee's
      employment  with the Company and all  Participating  Affiliates  and other
      Affiliates as a result of his quit,  retirement,  discharge,  death or his
      becoming  eligible to receive  disability  benefits under the Company's or
      Affiliate's  long-term  disability plan, to the extent such termination of
      employment  constitutes:  (i) a  "separation  from  service" as defined in
      Section 409A of the Code or (ii)  "disability"  as defined in Section 409A
      of the Code.

2.21  "Years of Benefit Service" or "Benefit Service" means the years of service
      described in Section 4.3.

2.22  "Years of Vesting Service" or "Vesting Service" means the years of service
      described in Section 7.2.


                                      -4-
<PAGE>

                                   ARTICLE III
                                  PARTICIPATION

3.1   Participant.  An Eligible Executive shall become a Participant in the Plan
      on the date he first becomes an Eligible Executive,  or such later date as
      designated by the Committee.

3.2   Suspension of  Participation.  A Participant who has an employment  status
      change,   as  provided   under  Section  9.2,   shall  be  suspended  from
      participation in the Plan.

3.3   Reinstatement.  A Participant who has been suspended from participation in
      the Plan under  Section  3.2 may be  reinstated  as a  Participant  at the
      discretion of the Committee.

3.4   Eligible Executive. An Eligible Executive is an Employee of the Company or
      of Central Hudson Gas & Electric Corporation who holds an officer position
      with the Company or with Central Hudson Gas & Electric Corporation, unless
      otherwise determined by the Committee.


                                      -5-
<PAGE>

                                   ARTICLE IV
                              SERP ACCRUED BENEFIT

4.1   SERP Accrued Benefit. A Participant's monthly SERP Accrued Benefit payable
      commencing on his Normal  Retirement Date shall equal the amount,  if any,
      by which (i) the  Participant's  monthly  Target  Retirement  Benefit  (as
      defined in the next  sentence)  exceeds (ii) the sum of the  Participant's
      Pension  Monthly  Benefit,  Restoration  Monthly  Benefit  and SRP Monthly
      Benefit (all as defined below in this Article IV). Subject to Section 7.1,
      the Participant's  monthly "Target Retirement Benefit" shall be determined
      pursuant to the following formula:

                                               Years of Benefit Service
              (57% x Final Average Pay)   x    (not to exceed 30 years)
              -------------------------        ------------------------
                       12 months                      30 years

4.2   Final Average Pay. A  Participant's  "Final Average Pay" is the sum of his
      highest  annual   compensation   (as  defined  herein)  during  the  three
      consecutive  calendar  years of the ten  consecutive  calendar years which
      immediately precede his Termination of Employment, divided by three.

      The  Participant's  "annual  compensation"  is his base  salary and annual
      incentive  compensation  from the Company,  Participating  Affiliates  and
      other Affiliates paid during a calendar year (including any years prior to
      his Plan  participation).  The Participant's annual compensation shall not
      be reduced by any elective contributions or deferrals from his base salary
      or annual incentive compensation made to the Central Hudson Gas & Electric
      Company  Savings  Incentive  Plan, any Code Section 125 plan maintained by
      the Company or Affiliate,  or any nonqualified  deferred compensation plan
      maintained by the Company or Affiliate.

      A  Participant's  "annual  compensation"  shall not  include  compensation
      received by a  Participant  during any period that  precedes  the date the
      Participant's employer became an Affiliate.

      If  the  Participant  does  not  have  three  calendar  years  of  "annual
      compensation,"  his  Final  Average  Pay is  the  average  of his  monthly
      compensation  while employed with the Company,  a Participating  Affiliate
      and other Affiliates, multiplied by twelve.

4.3   Years of Benefit Service. A Participant's "Years of Benefit Service" shall
      equal his years of benefit service under Section 1.34 of the Pension Plan,
      or any successor  provision  thereto.  However,  a  Participant  shall not
      receive  credit for periods of service  with the  Company or an  Affiliate
      after his suspension from participation in the Plan under Section 3.2.

4.4   Pension   Monthly   Benefit.   The  "Pension   Monthly   Benefit"  is  the
      Participant's monthly retirement benefit under the Pension Plan, paid as a
      single life annuity,  in the amount payable on his Normal Retirement Date,
      which  shall  include  the  social  security  supplement  payable  to  the
      Participant  under  Section  3.3 of the  Pension  Plan,  or any  successor
      provision  thereto,  converted  to a single  life  annuity,  but shall not
      include the retirement  account component of the Pension Plan as described
      in Article XI of the Pension Plan.

4.5   Restoration  Monthly  Benefit.  The  "Restoration  Monthly Benefit" is the
      Participant's  monthly retirement benefit under the Restoration Plan, paid
      as a single life annuity,  in the amount payable on his Normal  Retirement
      Date.


                                      -6-
<PAGE>

4.6   SRP Monthly Benefit. The "SRP Monthly Benefit" is the actuarial equivalent
      monthly amount of the Participant's  retirement  benefit under the SRP (if
      any) payable as of his Normal Retirement Date. For this purpose, actuarial
      equivalence  shall be determined (i) by converting the  participant's  SRP
      benefit payable on his Normal Retirement Date to an equivalent single life
      annuity payable on his Normal  Retirement Date based on the  Participant's
      single life expectancy as of his Normal  Retirement Date and (ii) based on
      actuarial  assumptions  and  procedures  prescribed by the Committee  from
      time-to-time, consistent with Section 9.7.


                                      -7-
<PAGE>

                                    ARTICLE V
                                     VESTING

5.1   Vesting  Requirements.  A Participant must become vested to be entitled to
      receive a SERP Accrued Benefit.  The Participant  shall become "vested" in
      the SERP  Accrued  Benefit  under the Plan under any one of the  following
      circumstances while an Employee:

      (a)   Attaining age 61 (under Section 5.2).

      (b)   Attaining Earliest Retirement Date (under Section 5.3).

      (c)   A Change in Control of the Company (under Section 5.5).

5.2   Attaining Age 61. A  Participant  shall become vested if he is an Employee
      of the  Company or an  Affiliate  on or after the day he attains age 61. A
      Participant  does not need 10 Years of Vesting Service to become vested in
      this case.

5.3   Earliest  Retirement Date. A Participant  shall also be vested if he is an
      Employee  of  the  Company  or an  Affiliate  on  or  after  his  Earliest
      Retirement Date as defined in Section 7.2. A Participant shall be entitled
      to a reduced  benefit if the  Participant  begins to receive  his  benefit
      before  attaining  age 61,  but after his  Earliest  Retirement  Date,  as
      provided for under Article VII.

5.4   Non-Vested  Termination.  Upon a  Participant's  Termination of Employment
      with the Company and all  Participating  Affiliates  and other  Affiliates
      before meeting any of the vesting requirements under Section 5.1, he shall
      not receive any benefit  from the Plan  whatsoever.  If a  Participant  is
      reemployed,  he may receive  credit for his prior  years of service  under
      Section 9.6.

5.5   Change in Control.  If a Participant is not otherwise vested under Section
      5.1, a  Participant  shall  become  vested upon a Change in Control of the
      Company as provided in Section 9.3.

5.6   Forfeiture Events. Even if vested, a Participant shall cease to be vested,
      and thereafter not entitled to any benefit from the Plan (regardless if it
      has  commenced),  under  certain  prescribed  circumstances  involving his
      conduct under Section 9.5.


                                      -8-
<PAGE>

                                   ARTICLE VI
                           NORMAL RETIREMENT BENEFIT

6.1   SERP Benefit.  If a  Participant  is vested under Article V as a result of
      attaining age 61, he shall receive his SERP Accrued  Benefit  effective as
      of his Normal Retirement Date (the  "commencement  date") as calculated in
      Section 4.1, to be paid in accordance with Section 6.3.

6.2   Normal Retirement Date. A Participant's "Normal Retirement Date" means the
      later of the date of his 61st birthday or the date of his  Termination  of
      Employment on or after his 61st birthday.

6.3   Actual  Payment.  A  Participant's  benefit  shall  be  paid  as  soon  as
      administratively  practicable  beginning  on the first day of the  seventh
      month  immediately  following  the  month in which the  commencement  date
      occurs in  accordance  with Section 6.1. The  Participant's  first payment
      shall include the value (without interest) of the payments the Participant
      would have  received  had his payment from the Plan begun on the first day
      of the first month following the commencement date.

6.4   Normal  Annuity  Form. A  Participant's  SERP  Accrued  Benefit is payable
      monthly in the form of a single life annuity.  However, if the Participant
      is married, his retirement benefit is payable in a joint and 100% survivor
      annuity with his spouse which is the  actuarial  equivalent  of the single
      life annuity.

      The normal annuity form of his SERP Accrued Benefit,  therefore, shall not
      be the actual  annuity  form in which he receives his  retirement  benefit
      from the Pension Plan.  Rather, the normal annuity form is based solely on
      his marital status at the commencement of his SERP Accrued Benefit.

6.5   Alternative  Form of Payment.  A Participant may elect to receive his SERP
      Accrued  Benefit  in one of the  following  forms of  payment  that is the
      actuarial  equivalent of the single life annuity form of payment,  subject
      to such rules and procedures as established by the Committee:

      (a)   A single life annuity.

      (b)   A 30%, 40%, 50%, 75% or 100% joint and survivor annuity.

      (c)   Any  other  annuity  form of  payment,  as may be  permitted  by the
            Committee.

      The Committee  shall disregard any election by a Participant to change the
      form of his SERP Accrued  Benefit to the extent such election would result
      in an  impermissible  acceleration  of the  payment  of the  Participant's
      benefit under the Plan within the meaning of Section 409A of the Code.

      At the election of the  Participant,  the joint and  survivor  annuity may
      provide  that  if  the  Participant's  joint  annuitant  dies  before  the
      Participant, the Participant's monthly benefit will increase to the amount
      he would have received had he  originally  elected the single life annuity
      form of payment. The joint and survivor annuity that includes this feature
      will be the actuarial  equivalent of a single life annuity form of payment
      as provided above.


                                      -9-
<PAGE>

6.6   Lump Sum for Small  Benefits.  The Plan does not allow a lump sum payment.
      However,  if the  actuarially  equivalent  lump  sum  present  value  of a
      Participant's  benefit  is under  $20,000 as of the  Participant's  Normal
      Retirement  Date, his benefit shall be paid in a lump sum on the first day
      of the  seventh  month  immediately  following  the  month  in  which  the
      Participant's Normal Retirement Date occurs.


                                      -10-
<PAGE>

                                   ARTICLE VII
                            EARLY RETIREMENT BENEFIT

7.1   Early Retirement Benefit. If a Participant is vested under Section 5.3, he
      shall receive an early retirement  benefit effective as of his Termination
      of Employment  (the  "commencement  date"),  to be paid in accordance with
      Section 7.3. The  Participant's  early retirement  benefit shall equal his
      SERP Accrued  Benefit  determined in accordance  with Section 4.1,  except
      that for purposes of this calculation,  the  Participant's  monthly Target
      Retirement  Benefit shall be reduced by one-third of one percent per month
      (or 4% per year) for each full month by which the commencement date of his
      SERP Accrued Benefit precedes the date he attains age 61.

7.2   Earliest Retirement Date. A Participant's "Earliest Retirement Date" means
      the date he has both (i)  attained age 55 and (ii) been  credited  with at
      least 10 Years of Vesting Service.

      A  Participant's  "Years  of  Vesting  Service"  shall  equal his years of
      vesting  service  under Section 1.35 of the Pension Plan, or any successor
      provision thereto.

7.3   Actual  Payment.  A  Participant's  benefit  shall  be  paid  as  soon  as
      administratively  practicable  beginning  on the first day of the  seventh
      month  immediately  following  the  month in which the  commencement  date
      occurs in  accordance  with Section 7.1. The  Participant's  first payment
      shall include the value (without interest) of the payments the Participant
      would have  received  had his payment from the Plan begun on the first day
      of the first month following the commencement date.

7.4   Normal Annuity Form. A  Participant's  SERP Accrued  Benefit is payable in
      the "normal"  annuity form based on his marital status on the commencement
      date of his SERP Accrued Benefit, as provided in Section 6.4.

7.5   Alternative  Form of Payment.  A Participant may elect to receive his SERP
      Accrued  Benefit  in one of the  following  forms of  payment  that is the
      actuarial  equivalent of the single life annuity form of payment,  subject
      to such rules and procedures as established by the Committee:

      (a)   A single life annuity.

      (b)   A 30%, 40%, 50%, 75% or 100% joint and survivor annuity.

      (c)   Any  other  annuity  form of  payment,  as may be  permitted  by the
            Committee.

      The Committee  shall disregard any election by a Participant to change the
      form of his SERP Accrued  Benefit to the extent such election would result
      in an  impermissible  acceleration  of the  payment  of the  Participant's
      benefit under the Plan within the meaning of Section 409A of the Code.

      At the election of the  Participant,  the joint and  survivor  annuity may
      provide  that  if  the  Participant's  joint  annuitant  dies  before  the
      Participant, the Participant's monthly benefit will increase to the amount
      he would have received had he  originally  elected the single life annuity
      form of payment. The joint and survivor annuity that includes this feature
      will be the actuarial equivalent of single life annuity form of payment as
      provided above.

7.6   Lump Sum for Small  Benefits.  The Plan does not allow a lump sum payment.
      However, if the lump sum present value of a Participant's benefit is under
      $20,000 as of the  Participant's  Termi-


                                      -11-
<PAGE>

      nation of Employment, his benefit shall be paid in a lump sum on the first
      day of the  seventh  month  immediately  following  the month in which the
      Participant's Termination of Employment occurs.


                                      -12-
<PAGE>

                                  ARTICLE VIII
                   EFFECT OF DEATH AND DISABILITY ON BENEFITS

8.1   Death Benefit.  If a Participant  dies before  becoming vested in his SERP
      Accrued Benefit under Article V, the Participant  shall not be entitled to
      any benefit under the Plan. If a Participant is vested in his SERP Accrued
      Benefit under Article V and dies before the commencement  date of his SERP
      Accrued  Benefit,