FIRST SUPPLEMENTAL INDENTURE

Exhibit 4(m)-2

SOUTHERN INVESTMENTS UK plc

and

SWEB HOLDINGS UK

and

BANKERS TRUST COMPANY, as Trustee,
Principal Paying Agent, Registrar and Transfer Agent

and

BANKERS TRUST LUXEMBOURG S.A.,
as Paying and Transfer Agent

FIRST SUPPLEMENTAL INDENTURE

Dated as of December 2, 1998

Debt Securities

      THIS FIRST SUPPLEMENTAL INDENTURE is made as of the 2^nd day of December, 1998, by and between SOUTHERN INVESTMENTS UK plc, a limited liability company incorporated under the laws of England and Wales, with UK Company Registration Number 3073865 (the "Company"), SWEB HOLDINGS UK, an unlimited liability company incorporated under the laws of England and Wales, with UK Company Registration Number 3585938 ("ULC"), BANKERS TRUST COMPANY, a New York banking corporation, as trustee, principal paying agent, registrar and transfer agent ("Bankers Trust") and BANKERS TRUST LEXEMBOURG S.A. as Paying and Transfer Agent (the "Agent").

WITNESSETH:

      WHEREAS, the Company, Bankers Trust and the Agent have heretofore entered into a Subordinated Debenture Indenture, dated as of January 29, 1997 (the "Original Indenture") to provide for 8.23% Subordinated Debenture Indenture, dated as of February 1, 2027 (the "Subordinated Debentures");

      WHEREAS, the Original Indenture is incorporated herein by this reference and the Original Indenture, as supplemented by this First supplemental Indenture, is herein called the "Indenture";

      WHEREAS, Section 901(4) of the Original Indenture provides that the Company and Bankers Trust, as trustee, may at any time without the consent of the holders of the Subordinated Debentures (the "Holders") modify, alter, amend or supplement the Original Indenture in certain respects which are not materially adverse to the Holders;

      WHEREAS, the Company proposes to amend the Original Indenture;

      WHEREAS, the Company desires to make ULC a co-obligor under the Indenture and ULC desires to become a co-obligor under the Indenture;

      WHEREAS, all conditions necessary to authorize the execution and delivery of this First Supplemental Indenture and to make it a valid and binding obligation of the parties have been done or performed.

      NOW, THEREFORE, in consideration of the agreement and obligations set forth herein and for other good and valuable consideration, the sufficiency of which is hereby acknowledged, the parties hereto hereby agree as follows:

ARTICLE ONE

      Section 101. Additional Obligor. As of the date hereof and pursuant to this First Supplemental Indenture, ULC becomes a co-obligor of the Subordinated