<PAGE>

                                 UNITED STATES
                        SECURITIES AND EXCHANGE COMMISSION
                            Washington, D.C.  20549


                                   FORM 10-Q


     [X]  QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
          SECURITIES EXCHANGE ACT OF 1934

          For the Quarterly Period Ended March 31, 2000
                                         --------------

     [ ]  TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
          SECURITIES EXCHANGE ACT OF 1934

          For the Transition Period From ____________ to ____________


                             Commission File Number
                             ----------------------
                                     1-956


                             Duquesne Light Company
                             ----------------------
             (Exact name of registrant as specified in its charter)


             Pennsylvania                            25-0451600
             ------------                            ----------
   (State or other jurisdiction of      (I.R.S. Employer Identification No.)
    incorporation or organization)

                               411 Seventh Avenue
                        Pittsburgh, Pennsylvania  15219
                        -------------------------------
               (Address of principal executive offices)(Zip Code)

      Registrant's telephone number, including area code:  (412) 393-6000


Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months and (2) has been subject to such filing requirements for
the past 90 days.  Yes  X    No
                      -----    -----

Indicate the number of shares outstanding of each of the issuer's classes of
common stock as of the latest practicable date:

DQE, Inc., is the holder of all shares of Duquesne Light Company common stock,
$1 par value, consisting of 10 shares as of April 30, 2000.
<PAGE>

Part I.   FINANCIAL INFORMATION

Item 1.  Financial Statements.

Duquesne Light Condensed Statement of Consolidated Income (Unaudited)
-------------------------------------------------------------------------------

<TABLE>
<CAPTION>
                                                              (Thousands of Dollars)
                                                     ----------------------------------------
                                                           Three Months Ended March 31,
                                                     ----------------------------------------
                                                                   2000               1999
---------------------------------------------------------------------------------------------
<S>                                                  <C>                 <C>
Operating Revenues:
Sales of Electricity:
Customer revenues                                            $  240,498         $  254,419
Utilities                                                        11,790             13,653
---------------------------------------------------------------------------------------------
Total Sales of Electricity                                      252,288            268,072
Other                                                            10,695             13,991
---------------------------------------------------------------------------------------------
 Total Operating Revenues                                       262,983            282,063
---------------------------------------------------------------------------------------------

Operating Expenses:
Fuel and purchased power                                         50,627             46,911
Other operating                                                  45,063             62,096
Maintenance                                                      17,689             20,337
Depreciation and amortization                                    61,534             52,840
Taxes other than income taxes                                    21,956             23,590
Income taxes                                                      6,674             17,193
---------------------------------------------------------------------------------------------
 Total Operating Expenses                                       203,543            222,967
---------------------------------------------------------------------------------------------
Operating Income                                                 59,440             59,096
---------------------------------------------------------------------------------------------
Other Income and Deductions                                       4,505              8,149
---------------------------------------------------------------------------------------------
Income Before Interest and Other Charges                         63,945             67,245
---------------------------------------------------------------------------------------------
Interest Charges                                                 20,968             28,236
---------------------------------------------------------------------------------------------
Monthly Income Preferred Securities Dividend
 Requirements                                                     3,141              3,141
---------------------------------------------------------------------------------------------
Net Income                                                       39,836             35,868
=============================================================================================
Dividends on Preferred and Preference Stock                         857                993
 Earnings for Common Stock                                   $   38,979         $   34,875
=============================================================================================
</TABLE>

See notes to condensed consolidated financial statements.

                                       2
<PAGE>

Duquesne Light Condensed Consolidated Balance Sheet (Unaudited)
--------------------------------------------------------------------------------

<TABLE>
<CAPTION>
                                                             (Thousands of Dollars)
                                                    -----------------------------------------
                                                          March 31,          December 31,
Assets                                                       2000                1999
---------------------------------------------------------------------------------------------
<S>                                                 <C>                  <C>
Property, Plant and Equipment:
 Gross property, plant and equipment                       $ 3,994,215         $ 3,959,236
 Less: Accumulated depreciation and
  amortization                                              (2,509,636)         (2,500,719)
---------------------------------------------------------------------------------------------
  Total Property, Plant and Equipment - Net                  1,484,579           1,458,517
---------------------------------------------------------------------------------------------
Long-Term Investments                                           85,462              80,891
---------------------------------------------------------------------------------------------
Current Assets:
Cash and temporary cash investments                             19,590              16,068
Receivables                                                    116,658             131,647
Other current assets                                            74,710             111,134
---------------------------------------------------------------------------------------------
  Total Current Assets                                         210,958             258,849
---------------------------------------------------------------------------------------------
Other Non-Current Assets:
Transition costs                                             1,961,818           2,008,171
Divestiture costs                                              248,687             218,653
Regulatory assets                                              224,500             224,002
Other                                                           27,923              32,329
---------------------------------------------------------------------------------------------
  Total Other Non-Current Assets                             2,462,928           2,483,155
---------------------------------------------------------------------------------------------
  Total Assets                                             $ 4,243,927         $ 4,281,412
=============================================================================================

CAPITALIZATION  AND LIABILITIES
---------------------------------------------------------------------------------------------
Capitalization:
Common stock (authorized - 90,000,000
 shares, issued and outstanding - 10 shares)               $       --          $       --
Capital surplus                                                744,849             746,051
Retained earnings                                               59,052              39,931
Accumulated other comprehensive income                          19,051              12,692
---------------------------------------------------------------------------------------------
  Total Common Stockholder's Equity                            822,952             798,674
---------------------------------------------------------------------------------------------
Preferred and Preference Stock                                 223,271             229,512
---------------------------------------------------------------------------------------------
Long-term debt                                               1,410,814           1,410,754
---------------------------------------------------------------------------------------------
  Total Capitalization                                       2,457,037           2,438,940
---------------------------------------------------------------------------------------------
Obligations Under Capital Leases                                15,320              16,534
---------------------------------------------------------------------------------------------
Current Liabilities:
Notes payable and current debt maturities                      569,308             536,353
Other current liabilities                                      154,613             225,333
---------------------------------------------------------------------------------------------
  Total Current Liabilities                                    723,921             761,686
---------------------------------------------------------------------------------------------
Non-Current Liabilities:
Deferred income taxes - net                                    750,263             760,677
Deferred investment tax credits                                 21,667              22,208
Deferred income                                                 90,162              93,246
Other non-current liabilities                                  185,557             188,121
---------------------------------------------------------------------------------------------
  Total Non-Current Liabilities                              1,047,649           1,064,252
---------------------------------------------------------------------------------------------
Commitments and Contingencies (Note D)
---------------------------------------------------------------------------------------------
  Total Capitalization and Liabilities                     $ 4,243,927         $ 4,281,412
=============================================================================================
</TABLE>

See notes to condensed consolidated financial statements.

                                       3
<PAGE>

Duquesne Light Condensed Statement of Consolidated Cash Flows (Unaudited)
--------------------------------------------------------------------------------

<TABLE>
<CAPTION>
                                                                (Thousands of Dollars)
                                                        ----------------------------------------
                                                             Three Months Ended March 31,
                                                        ----------------------------------------
                                                                  2000                1999
------------------------------------------------------------------------------------------------
<S>                                                     <C>                 <C>
Cash Flows From Operating Activities:
Operations                                                       $ 82,736           $  81,573
Changes in working capital other than cash                        (19,308)             45,221
Other                                                              (8,246)             (2,101)
------------------------------------------------------------------------------------------------
 Net Cash Provided By Operating Activities                         55,182             124,693
------------------------------------------------------------------------------------------------
Cash Flows From Investing Activities:
Acquisitions                                                      (32,000)                 --
Construction expenditures                                         (11,391)            (16,415)
Capitalized divestiture costs                                     (19,607)                 --
Long-term investments                                                  --              (3,311)
Other                                                               7,165              (3,311)
------------------------------------------------------------------------------------------------
  Net Cash Used In Investing Activities                           (55,833)            (23,037)
------------------------------------------------------------------------------------------------
Cash Flows From Financing Activities:
Issuance of commercial paper                                       52,906                  --
Issuance of debt                                                   25,000                  --
Dividends on capital stock                                        (19,857)           (119,222)
Reductions of long-term obligations - net                         (45,056)             (4,808)
Other                                                              (8,820)                425
------------------------------------------------------------------------------------------------
  Net Cash Provided By (Used In) Financing
   Activities                                                       4,173            (123,605)
------------------------------------------------------------------------------------------------
Net (decrease) increase in cash and temporary
 cash investments                                                   3,522             (21,949)
Cash and temporary cash investments at beginning
 of period                                                         16,068              53,151
------------------------------------------------------------------------------------------------
  Cash and Temporary Cash Investments at End of
   Period                                                        $ 19,590           $  31,202
------------------------------------------------------------------------------------------------
Non-Cash Investing and Financing Activities:
Capital lease obligations recorded                               $     --           $   5,984
================================================================================================
</TABLE>

See notes to condensed consolidated financial statements.

                                       4
<PAGE>

Duquesne Light Condensed Statement of Consolidated Comprehensive Income
(Unaudited)
--------------------------------------------------------------------------------

<TABLE>
<CAPTION>
                                                                (Thousands of Dollars)
                                                         -------------------------------------
                                                              Three Months Ended March 31,
                                                         -------------------------------------
                                                                     2000           1999
----------------------------------------------------------------------------------------------
<S>                                                      <C>                  <C>
Net income                                                           $39,836        $35,868
----------------------------------------------------------------------------------------------
Other comprehensive income:
  Unrealized holding gains (losses) arising during
   the period, net of tax of $4,510 and $(3,793)                       6,359         (5,348)
----------------------------------------------------------------------------------------------
Comprehensive Income                                                 $46,195        $30,520
==============================================================================================
</TABLE>
See notes to condensed consolidated financial statements.




Notes to Consolidated Financial Statements

A. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Consolidation

  Duquesne Light Company is a wholly owned subsidiary of DQE, Inc., a multi-
utility delivery and services company. Our two wholly owned subsidiaries,
Monongahela Light and Power Company and Duquesne Financial LLC, are involved in
making long-term investments and providing financing to certain affiliates,
respectively.

  We are engaged in the transmission, distribution and sale of electric energy.
On April 28, 2000, we completed the Pennsylvania Public Utility Commission
(PUC)-approved sale of our generation assets to Orion Power MidWest, L.P. (See
"Generation Asset Sale" discussion, Note B, on page 6.)

  All material intercompany balances and transactions have been eliminated in
the preparation of the consolidated financial statements.

  In the opinion of management, the unaudited condensed consolidated financial
statements included in this report reflect all adjustments that are necessary
for a fair presentation of the results of interim periods and are normal,
recurring adjustments.  Prior periods have been reclassified to conform with
current accounting presentations.

  These statements should be read with the financial statements and notes
included in our Annual Report on Form 10-K for the year ended December 31, 1999
filed with the Securities and Exchange Commission (SEC).  The results of
operations for the three months ended March 31, 2000, are not necessarily
indicative of the results that may be expected for the full year.  The
preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities and disclosure of
contingent assets and liabilities at the date of the financial statements.  The
reported amounts of revenues and expenses during the reporting period may also
be affected by the estimates and assumptions management is required to make.
Actual results could differ from those estimates.

Basis of Accounting

  We are subject to the accounting and reporting requirements of the SEC. In
addition, our electric utility operations are subject to regulation by the PUC
and the Federal Energy Regulatory Commission (FERC) with respect to rates for
interstate sales, transmission of electric power, accounting and other matters.

  As a result of our PUC-approved restructuring plan (see "Rate Matters," Note
B, below), the electricity supply segment does not meet the criteria of
Statement of Financial Accounting Standards (SFAS) No. 71, Accounting for the
Effects of Certain Types of Regulation (SFAS No. 71). Pursuant to the PUC's
final restructuring order, generation-related regulatory assets are being
recovered through a competitive transition charge (CTC) collected in connection
with providing transmission and distribution services, and these assets have
been reclassified accordingly. The balance of transition costs will be adjusted
by receipt of the generation asset sale proceeds. The electricity delivery
business segment continues to meet SFAS No. 71 criteria, and accordingly
reflects regulatory assets and liabilities consistent with cost-based ratemaking
regulations. The regulatory assets represent probable future revenue, because
provisions for these costs are currently included, or are expected to be
included, in charges to electric utility customers through the ratemaking
process. (See "Rate Matters," Note B, below.) These regulatory assets consist of
a regulatory tax receivable, unamortized debt costs and deferred employee costs.

B.  Rate Matters

Competition and the Customer Choice Act

  Under Pennsylvania ratemaking practice, regulated electric utilities were
granted exclusive geographic franchises to sell electricity, in exchange for
making investments and incurring obligations to serve customers under the then-
existing regulatory framework. Through the rate making process, those prudently
incurred costs were recovered from customers, along with a return on the
investment.  Additionally, certain operating costs were approved for deferral
for future recovery from customers (regulatory assets).  As a result of this
process, utili-

                                       5
<PAGE>

ties had assets recorded on their balance sheets at above-market
costs, thus creating transition costs.

  The Pennsylvania Electricity Generation Customer Choice and Competition Act
(Customer Choice Act) enables Pennsylvania's electric utility customers to
purchase electricity at market prices from a variety of electric generation
suppliers (customer choice).  All customers now have customer choice.  As of
April 30, 2000, approximately 24.3 percent of our customers had chosen
alternative generation suppliers, representing approximately 33.7 percent of our
non-coincident peak load. As of April 28, 2000, the remaining customers are
provided with electricity through our provider of last resort services agreement
with Orion (discussed below). Customers pay their electricity generation
supplier for generation charges, and pay us the CTC and charges for transmission
and distribution. Electricity delivery (including transmission, distribution and
customer service) remains regulated in substantially  the same manner as under
historical regulation.

Rate Cap

  An overall four-and-one-half-year rate cap from January 1, 1997, was
originally imposed on the transmission and distribution charges of Pennsylvania
electric utility companies under the Customer Choice Act.  As part of a
settlement regarding recovery of deferred fuel costs, we have agreed to extend
this rate cap for an additional six months through the end of 2001.

Provider of Last Resort

  We are required not only to deliver electricity, but also to serve as the
provider of last resort for all customers in our service territory.  Although no
longer a generation supplier, as the provider of last resort, we must provide
electricity for any customer who cannot or does not choose an alternative
electric generation supplier, or whose supplier fails to deliver.  While
collecting the CTC, we may charge only PUC-approved rates for the supply of
electricity as the provider of last resort.  As part of the generation asset
sale, Orion has agreed to supply us, under a provider of last resort service
agreement, with all of the electric energy necessary to satisfy our provider of
last resort obligations during the CTC collection period.  This agreement, which
expires upon our final collection of the CTC, in general effectively transfers
to Orion the financial risks and rewards associated with our provider of last
resort obligations.  While we retain the collection risk for the electricity
sales, a component of our regulated delivery rates is designed to cover the cost
of a normal level of uncollectible accounts. In April 2000, we entered into an
agreement with Orion that would, subject to PUC and other approvals, extend this
provider of last resort arrangement beyond the final CTC collection.

Generation Asset Sale

  In its May 29, 1998, final restructuring order, the PUC determined that we
should recover most of the above-market costs of our generation assets,
including plant and regulatory assets, through the collection of the CTC from
electric utility customers. The $1.49 billion of transition costs, net of tax,
was originally to be recovered over a seven-year period ending in 2005. However,
by applying the approximately $1.1 billion of net proceeds of the generation
asset sale to Orion to reduce transition costs, we currently anticipate early
termination of the CTC collection period in 2001 for most major rate classes. In
addition, the transition costs as reflected on the consolidated balance sheet
are being amortized over the same period that the CTC revenues are being
recognized.  We are allowed to earn an 11 percent pre-tax return on
approximately $275 million of unrecovered, net of tax balance of transition
costs, that remain following the generation asset sale. This amount remains
subject to PUC review. We will be filing our recovery request during the second
quarter.

  On April 28, 2000, we completed the sale of our generation assets to Orion.
Orion purchased our wholly owned Cheswick, Elrama, Phillips and Brunot Island
power stations, as well as the stations received from FirstEnergy Corp.  in the
December 3, 1999, power station exchange, for approximately $1.7 billion ($1.1
billion, net of tax and transaction expenses).

Termination of the AYE Merger

  On October 5, 1998, DQE announced its unilateral termination of the merger
agreement with Allegheny Energy, Inc. (AYE).  AYE filed suit in the United
States District Court for the Western District of Pennsylvania, seeking to
compel DQE to proceed with the merger, or in the alternative seeking an
unspecified amount of money damages.  After holding a trial from October 20
through 28, 1999, the District Court ruled on December 3, 1999, that DQE had
properly terminated the merger agreement without breach, and granted judgment in
DQE's favor on all claims and all requests for injunctive relief. On
December 14, 1999, AYE appealed this ruling to the Third Circuit.  Argument was
heard on March 9,  2000, and a decision is pending.  We cannot determine the
ultimate outcome of AYE's appeal at this time.

                                       6
<PAGE>

C.  RECEIVABLES

  The components of receivables for the periods indicated are as follows:

<TABLE>
<CAPTION>
                                            (Thousands of Dollars)
                             --------------------------------------------------
                                March 31,       March 31,        December 31,
                                  2000            1999               1999
-------------------------------------------------------------------------------
<S>                          <C>               <C>            <C>
Electric customers              $ 74,557        $ 88,970           $ 82,314
Other utility                     24,656          33,941             32,582
Other                             26,043          29,128             25,481
  (Allowance for
  uncollectible
  accounts)                       (8,598)         (9,778)            (8,730)
-------------------------------------------------------------------------------
Receivables - net                116,658         142,261            131,647
Less: Receivables sold                --         (50,000)                --
-------------------------------------------------------------------------------
  Total                         $116,658        $ 92,261           $131,647)
===============================================================================
</TABLE>

  We have an agreement with an unaffiliated corporation that entitles us to sell
and the corporation to purchase, on an ongoing basis, up to $50 million of
accounts receivable.  The accounts receivable sales agreement, which expires in
February 2001, is one of many sources of funds available to us.  We may elect to
extend the agreement upon expiration, replace it with a similar facility, or
terminate it.

D.  COMMITMENTS AND CONTINGENCIES

  We estimate that in 2000 we will spend, excluding the allowance for funds used
during construction, approximately $85 million (including $5 million relating to
generation) for electric utility construction.

E.  BUSINESS SEGMENTS AND RELATED INFORMATION

  We report our results by the following three principal business segments,
determined by products, services and regulatory environment: (1) the
transmission and distribution of electricity (electricity delivery business
segment), (2) the supply of electricity (electricity supply business segment)
and (3) the collection of transition costs (CTC business segment).  We also
report an "all other" category, which includes investments below the
quantitative threshold for separate disclosure.

                                       7
<PAGE>

Business Segments for the Three Months Ended,
--------------------------------------------------------------------------------

<TABLE>
<CAPTION>
                                                                   (Millions of Dollars)
                                         ----------------------------------------------------------------------------
                                            Electricity     Electricity                      All         Consoli-
                                             Delivery          Supply         CTC           Other         dated
                                         ----------------------------------------------------------------------------
March 31, 2000
---------------------------------------------------------------------------------------------------------------------
<S>                                      <C>                <C>           <C>           <C>            <C>
Operating revenues                               $   87.4        $ 78.8       $   96.4         $ 0.4       $  263.0
Operating expenses                                   44.6          79.6           18.6          (0.8)         142.0
Depreciation and amortization
 expense                                              9.1           5.2           46.0           1.2           61.5
---------------------------------------------------------------------------------------------------------------------
  Operating income (loss)                            33.7          (6.0)          31.8            --           59.5
Other income                                          0.9           2.5             --           1.1            4.5
Interest and other charges                           11.2           2.2           11.4           0.2           25.0
---------------------------------------------------------------------------------------------------------------------
  Earnings (loss) for common stock               $   23.4        $ (5.7)      $   20.4         $ 0.9       $   39.0
=====================================================================================================================

Assets                                           $1,527.8        $424.4       $2,206.8         $84.9       $4,243.9
=====================================================================================================================

Capital expenditures                             $   11.4        $   --       $     --         $  --       $   11.4
=====================================================================================================================
</TABLE>

<TABLE>
<CAPTION>
                                                                   (Millions of Dollars)
                                         ----------------------------------------------------------------------------
                                           Electricity     Electricity                     All          Consoli-
                                            Delivery         Supply          CTC          Other          dated
                                         ----------------------------------------------------------------------------
March 31, 1999
---------------------------------------------------------------------------------------------------------------------
<S>                                       <C>             <C>            <C>          <C>             <C>
Operating revenues                             $   82.3         $106.6      $   93.0          $ 0.2       $  282.1
Operating expenses                                 46.7           99.2          23.9            0.4          170.2
Depreciation and amortization
 expense                                           14.3            8.9          29.6             --           52.8
---------------------------------------------------------------------------------------------------------------------
  Operating income (loss)                          21.3           (1.5)         39.5           (0.2)          59.1
Other income                                        1.0            2.0            --            5.1            8.1
Interest and other charges                          8.9           11.7          11.7             --           32.3
---------------------------------------------------------------------------------------------------------------------
  Earnings (loss) for common stock             $   13.4         $(11.2)     $   27.8          $ 4.9       $   34.9
=====================================================================================================================

Assets (1)                                     $1,535.4         $425.7      $2,226.8          $93.5       $4,281.4
=====================================================================================================================

Capital expenditures                           $   13.4         $  3.0      $     --          $  --       $   16.4
=====================================================================================================================
</TABLE>

(1) Relates to assets as of December 31, 1999.

                                       8
<PAGE>

Item 2.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
         RESULTS OF OPERATIONS

   Part I, Item 2 of this Quarterly Report on Form 10-Q should be read in
conjunction with our Annual Report on Form 10-K for the year ended December 31,
1999 filed  with the Securities and Exchange Commission (SEC) and our condensed
consolidated financial statements, which are set forth on pages 2 through 8 of
this Report.

  Duquesne Light Company is a wholly owned subsidiary of DQE, Inc., a multi-
utility delivery and services company. Our two wholly owned subsidiaries,
Monongahela Light and Power Company and Duquesne Financial LLC, are involved in
making long-term investments and providing financing to certain affiliates,
respectively.

  We are engaged in the transmission, distribution and sale of electric energy.
On April 28, 2000, we completed the Pennsylvania Public Utility Commission
(PUC)-approved sale of our generation assets to Orion Power MidWest, L.P. (See
"Generation Asset Sale" discussion on page 12.)

Service Area

  We provide service to approximately 580,000 direct customers in southwestern
Pennsylvania (including in the City of Pittsburgh), a territory of approximately
800 square miles.  Before completing the generation asset sale, we also
historically sold electricity to other utilities. (See "Generation Asset Sale"
discussion on page 12.)

Regulation

  We are subject to the accounting and reporting requirements of the SEC. In
addition, our electric utility operations are subject to regulation by the PUC
and the Federal Energy Regulatory Commission (FERC) with respect to rates for
interstate sales, transmission of electric power, accounting and other matters.

  As a result of our PUC-approved restructuring plan (see "Rate Matters" on page
12), the electricity supply segment of our business does not meet the criteria
of Statement of Financial Accounting Standards (SFAS) No. 71, Accounting for the
Effects of Certain Types of Regulation (SFAS No. 71). Pursuant to the PUC's
final restructuring order, generation-related regulatory assets are being
recovered through a competitive transition charge (CTC) collected in connection
with providing transmission and distribution services, and these assets have
been reclassified accordingly. The balance of transition costs will be adjusted
by receipt of the proceeds from the generation asset sale. The electricity
delivery business segment continues to meet SFAS No. 71 criteria, and
accordingly reflects regulatory assets and liabilities consistent with cost-
based rate making regulations. The regulatory assets represent probable future
revenue, because provisions for these costs are currently included, or are
expected to be included, in charges to electric utility customers through the
rate making process. (See "Rate Matters" on page 12.)

  On December 15, 1999, the FERC issued its Order No. 2000, which calls on
transmission-owning utilities such as Duquesne Light to voluntarily join
regional transmission organizations. The goal of the order is to put
transmission facilities in a region under common control in an effort to reduce
costs. The order requires utilities to file a proposal for a regional
transmission organization, a description of efforts to join one, or reasons for
not joining one, by October 15, 2000.  We are currently studying Order No. 2000,
and have not yet determined our response.

Business Segments

  For the purposes of complying with SFAS No. 131, Disclosures about Segments of
an Enterprise and Related Information (SFAS No. 131), we are required to
disclose information about our business segments separately. This information is
set forth in "Results of Operations" below and in "Business Segments and Related
Information," Note E to our condensed consolidated financial statements on page
7.

RESULTS OF OPERATIONS

Overall Performance

  Our earnings available for common stock were $39.0 million in the first
quarter of 2000 compared to $34.9 million in the first quarter of 1999, an
increase of 11.7 percent. The increase is due to a lower effective tax rate
resulting from the prescribed accounting on the generation asset sale.

Results of Operations by Business Segment

Historically, Duquesne Light was treated as a single integrated business
segment, due to its regulated operating environment. The PUC authorized a
combined rate for supplying and delivering electricity to customers, that was
(1) cost-based, (2) designed to recover operating expenses and investment in
electric utility assets, and (3) designed to provide a return on the investment.
As a result of the Pennsylvania Electricity Generation Customer Choice and
Competition Act (Customer Choice Act), supply of electricity is deregulated and
charged at a separate rate from the delivery of electricity. For the purposes of
complying with SFAS No. 131, Disclosures about Segments of an Enterprise and
Related Information, we are required to disclose information about our business
segments separately.

  We report our results by the following three principal business segments,
determined by products, services and reg-

                                       9
<PAGE>

ulatory environment: (1) the transmission and distribution of electricity
(electricity delivery business segment), (2) the supply of electricity
(electricity supply business segment), and (3) the collection of transition
costs (CTC business segment). With the completion of our generation asset sale
on April 28, 2000, the electricity supply business segment is now comprised
solely of provider of last resort service.  We also report an "all other"
category, comprised of our investments, which through the first quarter included
leasing and landfill gas reserve investments.

  Additional information on our business segments is set forth in Note E,
"Business Segments and Related Information," in the Notes to the Consolidated
Financial Statements on page 7.

  Electricity Delivery Business Segment. The electricity delivery business
segment contributed $23.4 million to earnings available for common stock in the
first quarter of 2000 compared to $13.4 million in the first quarter of 1999,
an increase of $10.0 million or 74.6 percent.

  Operating revenues for this business segment are primarily derived from the
delivery of electricity. Sales to residential and commercial customers are
influenced by weather conditions.  Warmer summer and colder winter seasons lead
to increased customer use of electricity for cooling and heating. Commercial
sales also are affected by regional development. Sales to industrial customers
are influenced primarily by national and global economic conditions.

  Operating revenues increased by $5.1 million or 6.2 percent compared to the
first quarter of 1999 due to an increase in sales to electric utility customers
of 3.6 percent in the first quarter of 2000. This increase is due to higher
industrial sales due to increased consumption by steel manufacturers. The
following table sets forth kilowatt-hours (KWH) delivered to electric utility
customers.

<TABLE>
<CAPTION>
                                               KWH Delivered
                                 -------------------------------------------
                                               (In Millions)
                                 -------------------------------------------
First Quarter                             2000        1999         Change
----------------------------------------------------------------------------
<S>                              <C>            <C>         <C>
Residential                                904         917          (1.4)%
Commercial                               1,485       1,440           3.1 %
Industrial                                 934         851           9.8 %
-----------------------------------------------------------
  Sales to Electric
   Utility Customers                     3,323       3,208           3.6 %
============================================================================
</TABLE>

  Operating expenses for the electricity delivery business segment primarily are
made up of costs to operate and maintain the transmission and distribution
system; meter reading and billing costs; customer service; collection;
administrative expenses; income taxes; and non-income taxes, such as gross
receipts, property and payroll taxes. Operating expenses were relatively
consistent in the first quarters of 2000 and 1999.

  Depreciation and amortization expense decreased $5.2 million or 36.4 percent
in the first quarter of 2000 compared to the first quarter of 1999. This
decrease can be attributed to a depreciation study completed in the second
quarter of 1999 which reduced the composite depreciation rate of the
transmission and distribution assets.

  Interest and other charges include interest on long-term debt, other interest
and preferred stock dividends. In the first quarter of 2000, there was $2.3
million or 25.8 percent more interest and other charges allocated to the
electricity delivery business segment compared to the first quarter of 1999. The
increase was the result of additional short-term borrowings. Given the recently
completed generation asset sale to Orion, all our remaining financing costs
after recapitalization will be borne by the electricity delivery business
segment.

  Electricity Supply and CTC Business Segments. In the first quarter of 2000,
the electricity supply and CTC business segments reported earnings available for
common stock of $14.7 million compared to $16.6 million in the first quarter of
1999, a decrease of $1.9 million or 11.4 percent.

  For the electricity supply and CTC business segments, operating revenues are
derived primarily from the supply of electricity for delivery to retail
customers, the supply of electricity to wholesale customers and the collection
of generation-related transition costs from electricity delivery customers.

  Energy requirements for our retail electric utility customers are reduced as
more customers participate in customer choice. Energy requirements for
residential and commercial customers are also influenced by weather conditions.
Warmer summer and colder winter seasons lead to increased customer use of
electricity for cooling and heating. Commercial energy requirements are also
affected by regional development. Energy requirements for industrial customers
are primarily influenced by national and global economic conditions.

  Short-term sales to other utilities are made at market rates. Fluctuations in
electricity sales to other utilities are related to customer energy
requirements, the energy market and transmission conditions, and the
availability of generating stations.  We no longer make short-term sales to
other utilities now that the generation asset sale is completed.

  Operating revenues decreased by $24.4 million or  12.2 percent compared to the
first quarter of 1999. The decrease in revenues resulted primarily from 13.9
percent less energy supplied to electric utility customers due to greater
participation in customer choice. In addition, there was a 25.3 percent decrease
in energy supplied to other utilities in the first quarter of 2000 compared to
the first quarter of 1999, due to our decision to make 600 megawatts available
during the first six months of 1999 to licensed generation suppliers to
stimulate competition. The following table sets forth KWH supplied for customers
who have not chosen an alternative generation supplier.

                                       10
<PAGE>

<TABLE>
<CAPTION>
                                               KWH Supplied
                                --------------------------------------------
                                              (In Millions)
                                --------------------------------------------
First Quarter                            2000          1999        Change
----------------------------------------------------------------------------
<S>                             <C>            <C>           <C>
Residential                               682           823        (17.1)%
Commercial                                879         1,152        (23.7)%
Industrial                                849           823          3.2 %
------------------------------------------------------------
  Sales to Electric
   Utility Customers                    2,410         2,798        (13.9)%
------------------------------------------------------------
Sales to Other Utilities                  495           663        (25.3)%
------------------------------------------------------------
  Total Sales                           2,905         3,461        (16.1)%
============================================================================
</TABLE>

  Operating expenses for the electricity supply business segment are primarily
made up of energy costs; costs to operate and maintain the power stations;
administrative expenses; income taxes; and non-income taxes, such as gross
receipts, property and payroll taxes.

  Fluctuations in energy costs generally result from changes in the cost of
fuel; total KWH supplied; and generating station availability. In the first
quarter of 1999, fluctuations also resulted from the mix between coal, nuclear
generation and purchased power.

  Operating expenses decreased $24.9 million or 20.2 percent from the first
quarter of 1999, as a result of (1) less energy supplied due to customers
switching to alternative generation suppliers, (2) reduced maintenance costs due
to first quarter 1999 generation station outages, and (3) reduced non-fuel
operating expenses associated with the December 1999 power station exchange.

  Depreciation and amortization expense includes the depreciation of the power
stations' plant and equipment, amortization of transition costs and, in the
first quarter of 1999, accrued nuclear decommissioning costs. There was an
increase of $12.7 million or 33.0 percent compared to the first quarter of 1999.
This increase was due to a higher level of transition cost amortization in the
first quarter of 2000.

  Interest and other charges include interest on long-term debt, other interest
and preferred stock dividends of Duquesne Light. In the first quarter of 2000
there was a $9.8 million or 41.9 percent decrease in interest and other charges
compared to the first quarter of 1999. The decrease reflects $9.6 million of
Beaver Valley Unit 2 lease-related costs in the first quarter of 1999, which
were eliminated with the lease cancellation in December 1999.

  All Other. The all other category contributed $0.9 million to earnings
available for common stock in the first quarter of 2000 compared to $4.9 million
in the first quarter of 1999, a decrease of $4.0 million. The decrease is
primarily the result of lower lease income in the first quarter of 2000.

Liquidity and Capital Resources

Capital Expenditures

  We estimate that during 2000 we will spend, excluding the allowance for funds
used during construction, approximately $85 million for electric utility
construction, including $5 million for generation.  During the first three
months of 2000, we have spent approximately $11.4 million on capital
expenditures related to the electricity delivery business.

Acquisitions and Dispositions

  On March 31, 2000, we purchased from Itron, Inc. the Customer Advanced
Reliability System (CARS), the automated electronic meter reading system
developed by Itron for use with our electric utility customers. We had
previously leased these assets.

  On April 28, 2000, we completed the sale of our generation assets to Orion for
approximately $1.7 billion ($1.1 billion, net of tax and transaction costs).
(See "Generation Asset Sale" discussion on page 12.)

Financing

  During the first quarter, in addition to capital provided from operations, we
raised capital to finance a portion of the CARS acquisition and continue our
recapitalization program in connection with the generation divestiture.
Additional capital was required for the maturity of $45 million of first
mortgage bonds and the payment of $20 million of dividends.

  At March 31, 2000, we had $190 million of commercial paper borrowings
outstanding, and $379 million of current debt maturities. During the quarter,
the maximum amount of bank loans and commercial paper borrowings outstanding was
$190 million, the amount of average daily borrowings was $14 million, and the
weighted average daily interest rate was 6.0 percent. In the first quarter we
issued $25 million of first mortgage bonds to fund a portion of the CARS
acquisition, all of which were retired in May 2000.

Future Capital Requirements and Availability

  Having completed our generation asset sale, we are using the proceeds to
recapitalize. This process includes the retirement of short-term debt and the
redemption of long-term debt. Using proceeds from the generation asset sale, we
acquired the $359 million ($9 million of which was current debt) of 8.7 percent
collateralized lease bonds previously assumed as part of the Beaver Valley Unit
2 lease termination in December 1999. We retired an additional $410 million of
current debt, including $40 million related to our receivables facility, and
reduced our notes payable by $131 million in the second quarter. We also paid
$48 million of related interest and transaction expenses.

                                       11
<PAGE>

  We maintain a $225 million revolving credit agreement expiring in September
2000.  We have the option to convert the revolver into a term loan facility for
a period of two years for any amounts then outstanding upon expiration of the
revolving credit period. Interest rates can, in accordance with the option
selected at the time of the borrowing, be based on one of several indicators,
including prime, Eurodollar, or certificate of deposit rates. Facility fees are
based on the unborrowed amount of the commitment.  At March 31, 2000, no
borrowings were outstanding.

  We have an agreement with an unaffiliated corporation that entitles us to
sell, and the corporation to purchase, on an ongoing basis, up to $50 million of
accounts receivable.  At various times during the first quarter, we had sold
receivables under the facility. No amounts were outstanding at March 31, 2000.
At March 31, 1999 we had sold $50 million of receivables. The accounts
receivable sales agreement, which expires in February 2001, is one of many
sources of funds available to us.  We may elect to extend the agreement upon
expiration, replace it with a similar facility, or terminate it.

  With customer choice fully in effect, and our generation asset divestiture
complete, all our electric utility customers are buying their generation
directly from alternative suppliers or indirectly from Orion (who supplies
generation to us pursuant to our provider of last resort service agreement).
Customer revenues from our operations have been reduced by an amount equal to
the generation rate previously applicable to those customers using alternative
generation suppliers.   A further impact on customer revenues is expected to
occur when the CTC has been fully collected, which is currently expected to
occur in 2001 for most major rate classes; elimination of the CTC will reduce
customer rates.

RATE MATTERS

Competition and the Customer Choice Act

  Under Pennsylvania rate making practice, regulated electric utilities were
granted exclusive geographic franchises to sell electricity, in exchange for
making investments and incurring obligations to serve customers under the then-
existing regulatory framework. Through the rate making process, those prudently
incurred costs were recovered from customers, along with a return on the
investment.  Additionally, certain operating costs were approved for deferral
for future recovery from customers (regulatory assets).  As a result of this
process, utilities had assets recorded on their balance sheets at above-market
costs, thus creating transition costs.

  The Pennsylvania Electricity Generation Customer Choice and Competition Act
(Customer Choice Act) enables Pennsylvania's electric utility customers to
purchase electricity at market prices from a variety of electric generation
suppliers (customer choice).  All customers now have customer choice.  As of
April 30, 2000, approximately 24.3  percent of our customers had chosen
alternative generation suppliers, representing approximately 33.7 percent of our
non-coincident peak load.  As of April 28, 2000, the remaining customers are
provided with electricity through our provider of last resort service agreement
with Orion (discussed below). Customers pay their electricity generation
supplier for generation charges, and pay us the CTC and charges for transmission
and distribution. Electricity delivery (including transmission, distribution and
customer service) remains regulated in substantially the same manner as under
historical regulation.

Rate Cap

  An overall four-and-one-half-year rate cap from January 1, 1997, was
originally imposed on the transmission and distribution charges of Pennsylvania
electric utility companies under the Customer Choice Act.  As part of a
settlement regarding recovery of deferred fuel costs, we have agreed to extend
this rate cap for an additional six months through the end of 2001.

Provider of Last Resort

  We are required not only to deliver electricity, but also to serve as the
provider of last resort for all customers in our service territory.  Although no
longer a generation supplier, as the provider of last resort, we must provide
electricity for any customer who cannot or does not choose an alternative
electric generation supplier, or whose supplier fails to deliver.  While
collecting the CTC, we may charge only PUC-approved rates for the supply of
electricity as the provider of last resort.  As part of the generation asset
sale, Orion has agreed to supply us, under a provider of last resort service
agreement, with all of the electric energy necessary to satisfy our provider of
last resort obligations during the CTC collection period.  This agreement, which
expires upon our final collection of the CTC, in general effectively transfers
to Orion the financial risks and rewards associated with our provider of last
resort obligations.  While we retain the collection risk for the electricity
sales, a component of our regulated delivery rates is designed to cover the cost
of a normal level of uncollectible accounts. In April 2000, we entered into an
agreement with Orion that would, subject to PUC and other approvals, extend this
provider of last resort arrangement beyond the final CTC collection.

Generation Asset Sale

  In its May 29, 1998, final restructuring order, the PUC determined that we
should recover most of the above-market costs of our generation assets,
including plant and regulatory assets, through the collection of the CTC from
electric utility customers. The $1.49 billion of transition costs, net of tax,
was originally to be recovered over a seven-year period ending in 2005. However,
by applying the approximately $1.1 billion of net proceeds of the generation
asset sale to Orion to reduce transition costs, we currently anticipate early
termination of

                                       12
<PAGE>

the CTC collection period in 2001 for most major rate classes. In addition, the
transition costs as reflected on the consolidated balance sheet are being
amortized over the same period that the CTC revenues are being recognized.  We
are allowed to earn an 11 percent pre-tax return on approximately $275 million
of unrecovered, net of tax balance of transition costs, that remains following
the generation asset sale. This amount remains subject to PUC review. We will be
filing our recovery request during the second quarter.

  On April 28, 2000, we completed the sale of our generation assets to Orion.
Orion purchased our wholly owned Cheswick, Elrama, Phillips and Brunot Island
power stations, as well as the stations received from FirstEnergy Corp. in the
power station exchange, for approximately $1.7 billion ($1.1 billion, net of tax
and transaction expenses).

Termination of the AYE Merger

  On October 5, 1998, DQE announced its unilateral termination of the merger
agreement with Allegheny Energy, Inc. (AYE).  AYE filed suit in the United
States District Court for the Western District of Pennsylvania, seeking to
compel DQE to proceed with the merger, or in the alternative seeking an
unspecified amount of money damages.  After holding a trial from October 20
through 28, 1999, the District Court ruled on December 3, 1999, that DQE had
properly terminated the merger agreement without breach, and granted judgment in
DQE's favor on all claims and all requests for injunctive relief. On December
14, 1999, AYE appealed this ruling to the Third Circuit.  Argument was heard on
March 9, 2000, and a decision is pending.  We cannot determine the ultimate
outcome of AYE's appeal at this time.

OUTLOOK

  Following the generation asset sale, we will be much smaller than we
historically have been. Among the challenges we face is changing the role of our
administrative infrastructure.  While the number of electricity customers that
we serve will not change, our margins from these customers will decline to
reflect the fact that we are providing only the delivery service and not the
electricity itself.  Our reduced margins will necessitate a lower level of
support costs at the electricity delivery business.  We expect to retrain and
redeploy some of our administrative employees, but we also must reduce our
overall administrative costs to maintain profitability.  DQE has initiated a
corporate center excellence project designed to consolidate administrative
resources and significantly reduce administrative costs, including those at
Duquesne Light, by the end of 2001.

  Additionally, we will be looking for opportunities to provide new services to
our existing customer base and to new customers.  For example, with the CARS
acquisition in the first quarter we expect not only to reduce operating costs,
but to position ourselves to offer additional products to our customers and
telemetry services to other utilities.

  Also related to the generation divestiture, we will be changing our capital
structure. With the proceeds from the sale, we have retired higher-cost series
of outstanding debt, reduced the level of equity and provided DQE with $450
million ($200 million in dividends). We will continue to recapitalize
accordingly to create a capital structure appropriate for an electricity
delivery company.

  We continue to expect that 2000 will be an evolutionary year.  We are now
fully out of the electricity generation business and are taking steps to
solidify returns in our delivery business.


Item 3.  Quantitative and Qualitative Disclosures
         About Market Risk.

  Market risk represents the risk of financial loss that may impact our
consolidated financial position, results of operations or cash flows due to
adverse changes in market prices and rates.

  We manage our interest rate risk by balancing our exposure between fixed and
variable rates while attempting to minimize our interest costs. Currently, our
variable interest rate debt is approximately 30 percent of long-term borrowings.
This variable rate debt is low-cost, tax-exempt debt.  We also manage our
interest rate risk by retiring and issuing debt from time to time and by
maintaining a balance of short-term, medium-term and long-term debt.  A 10
percent increase in interest rates would have affected our variable rate debt
obligations by increasing interest expense by approximately $0.4 million for the
three months ended March 31, 2000 and 1999.  A 10 percent reduction in interest
rates would have increased the market value of our fixed rate debt by
approximately $21.4 million and $15.1 million as of March 31, 2000 and March 31,
1999. Such changes would not have had a significant near-term effect on our
future earnings or cash flows.

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

  Except for historical information contained herein, the matters discussed in
this report are forward-looking statements that involve risks and uncertainties
including, but not limited to: the final outcome of AYE's merger-related
litigation; economic, competitive, regulatory, governmental and technological
factors affecting operations, markets, products, services and prices; and other
risks discussed in our filings with the SEC.

                                       13
<PAGE>

PART II.  OTHER INFORMATION.

Item 1.   Legal Proceedings.

Termination of the AYE Merger

  On October 5, 1998, DQE announced the unilateral termination of the merger
agreement with Allegheny Energy, Inc. (AYE). DQE believes that AYE suffered a
material adverse effect as a result of the PUC's final restructuring order
regarding AYE's utility subsidiary, West Penn Power Company. AYE filed suit in
the United States District Court for the Western District of Pennsylvania,
seeking to compel DQE to proceed with the merger, or in the alternative seeking
an unspecified amount of money damages. On October 28, 1998, the judge ruled in
DQE's favor regarding termination of the merger agreement.  AYE appealed to the
United States Court of Appeals for the Third Circuit, who on March 11, 1999,
remanded the case to the District Court for further proceedings. Trial was held
from October 20 through 28, 1999. On December 3, 1999, the District Court ruled
that DQE had properly terminated the merger agreement without breach, and
granted judgment in its favor on all claims and all requests for injunctive
relief. On December 14, 1999, AYE appealed this decision to the Third Circuit.
Argument was heard on March 9, 2000, and a decision is pending.  DQE will
continue to defend itself vigorously against AYE's claims. The ultimate outcome
of the appeal cannot be determined at this time.

Item 6.   Exhibits and Reports on Form 8-K

a.  Exhibits:

    EXHIBIT 12.1 - Calculation of Ratio of Earnings to Fixed
                   Charges and Preferred and Preference
                   Stock Dividend Requirements.

    EXHIBIT 27.1 - Financial Data Schedule

b.  A report on Form 8-K was filed May 12, 2000, to report the completion of
    the sale of our power plants and provider of last resort service. Pro forma
    financial statements were filed with this report.

                         _____________________________

                                       14
<PAGE>

                                  SIGNATURES

  Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant identified below has duly caused this report to be signed on its
behalf by the undersigned thereunto duly authorized.


                                           Duquesne Light Company
                                    ------------------------------------
                                                (Registrant)



Date   May 15, 2000                         /s/ Morgan K. O'Brien
      -------------                 ------------------------------------
                                               (Signature)
                                             Morgan K. O'Brien
                                          Vice President - Finance
                                        (Principal Financial Officer)



Date   May 15, 2000                         /s/ Stevan R. Schott
      -------------                 ------------------------------------
                                               (Signature)
                                             Stevan R. Schott
                                        Vice President and Controller
                                       (Principal Accounting Officer)

                                       15