SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549
 
                                 SCHEDULE 14D-9

                                (Amendment No. 1) 

                     SOLICITATION/RECOMMENDATION STATEMENT
                          PURSUANT TO SECTION 14(D)(4)
                     OF THE SECURITIES EXCHANGE ACT OF 1934
 
                               ----------------
 
                              MAGMA POWER COMPANY
                           (Name of Subject Company)
 
                              MAGMA POWER COMPANY
                      (Name of Person(s) Filing Statement)
 
                    COMMON STOCK, PAR VALUE $0.10 PER SHARE
           (INCLUDING THE ASSOCIATED PREFERRED STOCK PURCHASE RIGHTS)
                         (Title of Class of Securities)
 
                                   0005591941
                     (CUSIP number of Class of Securities)
 
                               JON R. PEELE, ESQ.
            Executive Vice President, Secretary and General Counsel
                              MAGMA POWER COMPANY
                        4365 EXECUTIVE DRIVE, SUITE 900
                          SAN DIEGO, CALIFORNIA 92121
                                 (619) 622-7800
 (Name, address and telephone number of person authorized to receive notice and
          communications on behalf of the person(s) filing statement)
 
                                   Copies to:
 

                                            
             Michael J. Kennedy, Esq.                     David W. Heleniak, Esq.
               SHEARMAN & STERLING                          SHEARMAN & STERLING
              555 California Street                         599 Lexington Avenue
         San Francisco, California 94104                  New York, New York 10022
                  (415) 616-1100                               (212) 848-4000


 
 
  This Amendment No. 1 amends and supplements the Solicitation/Recommendation 
Statement on Schedule 14D-9, dated October 11, 1994, as amended (the "Schedule 
14D-9"), filed by Magma Power Company, a Nevada corporation, relating to the
tender offer disclosed in a Tender Offer Statement on Schedule 14D-1 dated
October 6, 1994, as amended through the date hereof, of CE Acquisition Company,
Inc., a Delaware corporation and a wholly owned subsidiary of California Energy
Company, Inc., a Delaware corporation, to purchase 12,400,000 Shares at a price
of $35 per Share net to the seller in cash, upon the terms and subject to the
conditions set forth in the Offer to Purchase dated October 6, 1994, as amended
through the date hereof, and the related Letter of Transmittal and any
supplement thereto. Capitalized terms used and not defined herein shall have the
meanings set forth in the Schedule 14D-9.
 
ITEM 9. MATERIAL TO BE FILED AS EXHIBITS.
 
Item 9 is hereby amended and supplemented by adding thereto the following:
 
  Exhibit 12 -- Slide Show Presentation.


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                                   SIGNATURE
 
  After reasonable inquiry and to the best of my knowledge and belief, I
certify that the information set forth in this Statement is true, complete and
correct.
 
                                          MAGMA POWER COMPANY
 
                                                    /s/ Jon R. Peele
                                          By:__________________________________
                                             Name: Jon R. Peele
                                             Title: Executive Vice President,
                                                   Secretary and General
                                                   Counsel
 
Dated: October 13, 1994
 
 
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                               INDEX TO EXHIBITS
 


 EXHIBITS
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 Exhibit 12 --Slide Show Presentation.