FORM 8-K



                  SECURITIES AND EXCHANGE COMMISSION

                        Washington, D.C.  20549



                            CURRENT REPORT



                Pursuant to Section 13 or 15(d) of the
                    Securities Exchange Act of 1934

                    Date of Report:  December, 1998


                      MAINE PUBLIC SERVICE COMPANY            
        (Exact name of registrant as specified in its charter)



            Maine                   1-3429          01-0113635      
(State, or other jurisdiction    (Commission       (IRS Employer
      of incorporation)          File Number)    Identification No.)


209 State Street, Presque Isle, Maine                 04769  
(Address of principal executive offices)            (Zip Code)


Registrant's Telephone Number, Including Area Code   207-768-5811










Current Report, Form 8-K for                            Date of Report
Maine Public Service Company                            December, 1998

Item 5(a) Other Material Events - Agreement Reached on Transmission
          Concerns.

          Reference is made to the Company's Form 10-K for December 31,
          1997 and Form 10-Q for the quarter ended September 30, 1998,
          where the Company's efforts to divest of its generating assets
          in accordance with Maine's restructuring legislation are
          discussed, including concerns by the Maine Public Utilities
          Commission (MPUC) regarding the development of a retail market
          in Northern Maine.  One particular concern was related to the
          transmission tariffs charged by New Brunswick Power on power
          delivered to Northern Maine.

          Paul R. Cariani, President and CEO of Maine Public Service
          Company (MPS), announced today that an agreement in principle
          was reached pursuant to a two-day negotiating session in
          Augusta on December 16 and 17, 1998.  This agreement resolves
          all transmission issues in New Brunswick and will allow
          competitively-priced electricity to flow from New England,
          through New Brunswick into Northern Maine.  Parties to the
          agreement, beside Maine Public Service Company, are the Office
          of the Public Advocate, Eastern Maine Electric Co-Operative,
          Houlton Water Company, Van Buren Light and Power District and
          NB Power.

          Pleased with the preliminary settlement, Cariani said the
          final agreement is expected in January and requires approval
          of the MPUC.

                                   MAINE PUBLIC SERVICE COMPANY
                                             Registrant



Dated:  December 18, 1998          /s/  Larry E. LaPlante                      
                                   Larry E. LaPlante, Vice President,
                                   Finance, Administration & Treasurer













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