We report total-energy electronic structure calculations that provide energetics of encapsulation of C60 in the carbon nanotube and electronic structures of the resulting carbon peapods. We find that the encapsulating process is exothermic for the (10,10) nanotube, whereas the processes are endothermic for the (8,8) and (9,9) nanotubes, indicative that the minimum radius of the nanotube for the encapsulation is 6.4 A. We also find that the C(60)@(10,10) is a metal with multicarriers each of which distributes either along the nanotube or on the C60 chain. This unusual feature is due to the nearly free electron state that is inherent to hierarchical solids with sufficient space inside.