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

                                    FORM 10-Q

(Mark  One)
     (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

                                       or

    ( ) TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
                              EXCHANGE ACT OF 1934
                    For the transition period from  ______   to ______


Commission        Registrant, State of Incorporation,         I.R.S. Employer
File Number          Address and Telephone Number            Identification No.

1-11377                      CINERGY CORP.                       31-1385023
                        (A Delaware Corporation)
                         139 East Fourth Street
                         Cincinnati, Ohio 45202
                            (513) 287-2644

1-1232           THE CINCINNATI GAS & ELECTRIC COMPANY           31-0240030
                        (An Ohio Corporation)
                        139 East Fourth Street
                        Cincinnati, Ohio 45202
                            (513) 287-2644

1-3543                     PSI ENERGY, INC.                      35-0594457
                       (An Indiana Corporation)
                         1000 East Main Street
                       Plainfield, Indiana 46168
                            (513) 287-2644

2-7793          THE UNION LIGHT, HEAT AND POWER COMPANY          31-0473080
                        (A Kentucky Corporation)
                         139 East Fourth Street
                         Cincinnati, Ohio 45202
                            (513) 287-2644




Indicate  by check mark  whether  the  registrants  (1) have  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  (or for such  shorter  period  that the
registrants  were required to file such  reports),  and (2) have been subject to
such filing requirements for the past 90 days. YES X NO


<PAGE>



This combined Form 10-Q is separately filed by Cinergy Corp., The Cincinnati Gas
& Electric  Company,  PSI  Energy,  Inc.,  and The Union  Light,  Heat and Power
Company.  Information  contained herein relating to any individual registrant is
filed  by  such  registrant  on  its  own  behalf.   Each  registrant  makes  no
representation as to information relating to the other registrants.

The Union  Light,  Heat and Power  Company  meets  the  conditions  set forth in
General  Instruction  H(1)(a) and (b) of Form 10-Q and is  therefore  filing its
company  specific  information with the reduced  disclosure  format specified in
General Instruction H(2) of Form 10-Q.

As of April 30, 2000,  shares of Common Stock  outstanding  for each  registrant
were as listed:

 Registrant                           Description                      Shares

Cinergy Corp.                  Par value $.01 per share             158,923,399

The Cincinnati Gas &
  Electric Company             Par value $8.50 per share             89,663,086


PSI Energy, Inc.               Without par value, stated value       53,913,701
                               $.01 per share
The Union Light, Heat
  and Power Company            Par value $15.00 per share               585,333
  Company







<PAGE>




                                TABLE OF CONTENTS

--------------------------------------------------------------------------------
  Item                                                                     Page
 Number                                                                   Number
--------                                                                 -------
                          PART I FINANCIAL INFORMATION

   1     Financial Statements ...............................................3
           CINERGY CORP......................................................3
             Consolidated Statements of Income...............................4
             Consolidated Balance Sheets.....................................5
             Consolidated Statements of Changes in Common Stock Equity.......7
             Consolidated Statements of Cash Flows...........................8

           THE CINCINNATI GAS & ELECTRIC COMPANY ............................9
             Consolidated Statements of Income and Comprehensive Income.....10
             Consolidated Balance Sheets ...................................11
             Consolidate Statements of Cash Flows...........................13

           PSI ENERGY, INC..................................................14
             Consolidated Statements of Income and Comprehensive Income.....15
             Consolidated Balance Sheets ...................................16
             Consolidate Statements of Cash Flows ..........................18

           THE UNION LIGHT, HEAT AND POWER COMPANY .........................19
             Statements of Income and Comprehensive Income..................20
             Balance Sheets.................................................21
             Statements of Cash Flows.......................................23

         Notes to Financial Statements......................................24

         Cautionary Statements Regarding Forward-Looking Information........35

   2     Management's Discussion and Analysis of Financial Condition........37
              and Results of Operations
           Introduction.....................................................37
           Liquidity........................................................37
           Capital Resources................................................38
           First Quarter 2000 Results of Operations - Historical............41
           Results of Operations - Future...................................46

   3     Quantitative and Qualitative Disclosures About Market Risk ........50


                            PART II OTHER INFORMATION

   1     Legal Proceedings..................................................51

   4     Submission of Matters to a Vote of Security Holders................51

   6     Exhibits and Reports on Form 8-K...................................53

         Signatures ........................................................54










<PAGE>





                                  CINERGY CORP.

                            AND SUBSIDIARY COMPANIES




<PAGE>
<TABLE>
<CAPTION>


                                  CINERGY CORP.
                        CONSOLIDATED STATEMENTS OF INCOME

                                                     Quarter Ended
                                                        March 31
                                                2000                1999
                                        (in thousands, except per share amounts)
                                                      (unaudited)
<S>                                         <C>                 <C>
Operating Revenues
   Electric                                 $1,066,697          $  968,532
   Gas                                         498,728             421,308
   Other                                        17,652              12,439
                                            ----------          ----------
Total Operating Revenues                     1,583,077           1,402,279

Operating Expenses
   Fuel and purchased and exchanged power      500,778             433,169
   Gas purchased                               406,145             334,402
   Operation and maintenance                   245,423             244,548
   Depreciation and amortization                90,135              86,477
   Taxes other than income taxes                66,131              69,534
                                            ----------          ----------
Total Operating Expenses                     1,308,612           1,168,130

Operating Income                               274,465             234,149

Equity in Earnings of
  Unconsolidated Subsidiaries                    1,842              44,682
Miscellaneous - Net                             (2,503)            (11,886)
Interest                                        51,430              60,772

Income Before Taxes                            222,374             206,173



Income Taxes                                    82,572              77,564
Preferred Dividend Requirements
 of Subsidiaries                                 1,363               1,364
                                           -----------         -----------
Net Income                                 $   138,439         $   127,245
                                           ===========         ===========

Average Common Shares Outstanding              158,923             158,746

Earnings Per Common Share
  Net Income                                     $0.87               $0.80

Earnings Per Common Share-Assuming Dilution
  Net income                                     $0.87               $0.80

Dividends Declared Per Common Share              $0.45               $0.45

<FN>
The  accompanying  notes as they relate to Cinergy Corp. are an integral part of
these consolidated financial statements.
</FN>
</TABLE>





<PAGE>
<TABLE>
<CAPTION>





                                  CINERGY CORP.
                           CONSOLIDATED BALANCE SHEETS

ASSETS
<S>                                             <C>                 <C>
                                                   March 31         December 31
                                                     2000              1999
                                                 (unaudited)
                                                       (dollars in thousands)


Current Assets
  Cash and cash equivalents                     $  76,604           $   81,919
  Restricted deposits                                 658                  628
  Notes receivable                                  1,121                  481
  Accounts receivable less accumulated
    provision for doubtful accounts of
    $27,284 at March 31, 2000,                    669,637              706,068
    and $26,811 at December 31, 1999
 Materials, supplies, and fuel -
    at average cost                               174,986              205,749
 Energy risk management current assets            195,150              131,145
 Prepayments and other                             94,235               77,701
                                               ----------           ----------
          Total Current Assets                  1,212,391            1,203,691

Utility Plant - Original Cost
  In service
    Electric                                    9,471,140            9,414,744
    Gas                                           834,411              824,427
    Common                                        189,897              189,124
                                              -----------          -----------
      Total                                    10,495,448           10,428,295
  Accumulated depreciation                      4,337,377            4,259,877
                                              -----------          -----------
      Total                                     6,158,071            6,168,418
  Construction work in progress                   289,390              249,054
                                              -----------          -----------
          Total Utility Plant                   6,447,461            6,417,472


Other Assets
  Regulatory assets                             1,030,901            1,055,012
  Investments in unconsolidated subsidiaries      464,436              358,853
  Energy risk management non-current assets        40,656               26,624
  Other                                           556,895              555,296
                                              -----------          -----------
          Total Other Assets                    2,092,888            1,995,785



Total Assets                                  $ 9,752,740          $ 9,616,948
                                              ===========          ===========



<FN>
The  accompanying  notes as they relate to Cinergy Corp. are an integral part of
these consolidated financial statements.
</FN>
</TABLE>






<PAGE>
<TABLE>
<CAPTION>






                                  CINERGY CORP.
                           CONSOLIDATED BALANCE SHEETS


LIABILITIES AND SHAREHOLDERS' EQUITY
<S>                                       <C>                       <C>

                                             March 31               December 31
                                               2000                    1999
                                             (unaudited)
                                                    (dollars in thousands)
Current Liabilities
  Accounts payable                        $   604,275               $   734,937
  Accrued taxes                               261,265                   219,266
  Accrued interest                             46,983                    49,354
  Notes payable and other short-term
     obligations                              639,321                   550,194
  Long-term debt due within one year           31,871                    31,000
  Energy risk management current
     liabilities                              173,452                   126,682
  Other                                        82,674                    76,774
                                           ----------                ----------
       Total Current Liabilities            1,839,841                 1,788,207


Non-Current Liabilities
  Long-term debt                           2,988,281                  2,989,242
  Deferred income taxes                    1,160,312                  1,174,818
  Unamortized investment tax
      credits                                145,186                    147,550
  Accrued pension and other
      postretirement benefit costs           366,299                    355,917

  Energy risk management non-current
      liabilities                            145,126                    132,041
  Other                                      288,370                    282,855
                                          ----------                 ----------
       Total Non-Current Liabilities       5,093,574                  5,082,423


Total Liabilities                          6,933,415                  6,870,630



Cumulative Preferred Stock of Subsidiaries
  Not subject to mandatory redemption         92,457                     92,597


Common Stock Equity
   Common Stock - $.01 par value;
     authorized shares  -  600,000,000;
     outstanding shares - 158,923,399
     at March 31, 2000 and
     December 31, 1999                         1,589                      1,589
   Paid-in capital                         1,604,096                  1,597,554
   Retained earnings                       1,131,695                  1,064,319
   Accumulated other comprehensive
     income (loss)                           (10,512)                    (9,741)
                                          ----------                 ----------
       Total Common Stock Equity           2,726,868                  2,653,721


Commitments and Contingencies (Note 4)

Total Liabilities and Shareholders'
   Equity                                 $9,752,740                 $9,616,948
                                          ==========                 ==========


<FN>
The  accompanying  notes as they relate to Cinergy Corp. are an integral part of
these consolidated financial statements.
</FN>
</TABLE>






<PAGE>






<TABLE>
<CAPTION>

                                  CINERGY CORP.
            CONSOLIDATED STATEMENTS OF CHANGES IN COMMON STOCK EQUITY


<S>                                                <C>         <C>            <C>              <C>             <C>

                                                                                               Accumulated       Total
                                                                                                  Other          Common
                                                   Common      Paid-in        Retained        Comprehensive      Stock
                                                   Stock       Capital        Earnings        Income/(Loss)      Equity
------------------------------------------------------------------------------------------------------------------------------------
                                                                               (dollars in thousands)
                                                                                    (unaudited)

Quarter Ended March 31, 2000

Balance at January 1, 2000                         $1,589      $1,597,554     $1,064,319       $ (9,741)       $2,653,721
Comprehensive income:
   Net income
   Other comprehensive income (loss),
     net of tax effect of $534                                                   138,439                          138,439
     Foreign currency translation adjustment                                                     (1,728)           (1,728)
     Unrealized gains on grantor and
       rabbi trusts                                                                                 957               957
                                                                                                                 --------
   Total comprehensive income                                                                                     137,668
Treasury shares reissued                                            6,542                                           6,542
Dividends on common stock
  (see page 4 for per share amounts)                                             (71,077)                         (71,077)
Other                                                                                 14                               14
                                                   ---------------------------------------------------------------------------------

Ending balance at March 31, 2000                   $1,589      $1,604,096     $1,131,695       $(10,512)       $2,726,868
                                                   ======      ==========     ==========       =========       ==========
------------------------------------------------------------------------------------------------------------------------------------

Quarter Ended March 31, 1999

Balance at January 1, 1999                         $1,587      $1,595,237      $ 945,214       $   (807)       $2,541,231
Comprehensive income:
  Net income                                                                     127,245                          127,245
  Other comprehensive income (loss),
    net of tax effect of $1,762
    Foreign currency translation adjustment                                                      (8,451)           (8,451)
    Unrealized gains (losses) on grantor and
      rabbi trusts                                                                                  (15)              (15)
                                                                                                                ----------
  Total comprehensive income                                                                                      118,779
Issuance of 115,368 shares of common stock-net          1           1,978                                           1,979
Treasury shares purchased                                            (233)                                           (233)
Treasury shares reissued                                            1,902                                           1,902
Dividends on common stock
 (see page 4 for per share amounts)                                              (71,422)                         (71,422)
Other                                                                                 (3)                              (3)
                                                   ------------------------------------------------------------------------
Ending balance at March 31, 1999                   $1,588      $1,598,884     $1,001,034       $ (9,273)       $2,592,233
                                                   ======      ==========     ==========       =========       ==========




<FN>
The  accompanying  notes as they relate to Cinergy Corp. are an integral part of
these consolidated financial statements.
</FN>
</TABLE>





<PAGE>
<TABLE>
<CAPTION>







                                  CINERGY CORP.
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
<S>                                                   <C>              <C>

                                                             YEAR TO DATE
                                                               March 31
                                                         2000            1999
                                                        (dollars in thousands)
                                                             (unaudited)

Operating Activities
  Net income                                          $138,439         $127,245
  Items providing or (using) cash currently:
    Depreciation and amortization                       90,135           86,477
    Deferred income taxes and investment tax
       credits-net                                        (841)          12,877
    Unrealized (gain) loss from energy risk
       management activities                           (18,182)         (23,000)
    Equity in earnings of unconsolidated
       subsidiaries                                     (1,842)         (44,682)
    Allowance for equity funds used during
       construction                                       (902)            (775)
    Regulatory assets-net                                6,853            5,140
    Changes in current assets and current
      liabilities:
        Restricted deposits                                (30)             (54)
        Accounts and notes receivable                   35,226          182,265
        Materials, supplies, and fuel                   30,763           21,778
        Accounts payable                              (130,662)        (235,128)
        Accrued taxes and interest                      39,628            1,031
    Other items-net                                     (5,766)           9,478
                                                     ---------        ---------
        Net cash provided by operating activities      182,819          142,652


   Financing Activities

   Change in short-term debt                            89,127          149,111
   Issuance of long-term debt                             -               6,623
   Redemption of long-term debt                           (594)        (116,000)
   Retirement of preferred stock of subsidiaries          (105)             (20)
   Issuance of common stock                               -               1,979
   Dividends on common stock                           (71,077)         (71,422)
                                                     ---------        ---------
        Net cash provided by (used in)
          financing activities                          17,351          (29,729)


   Investing Activities

     Construction expenditures (less allowance
       for equity funds used during construction)     (106,984)         (79,143)
     Investments in unconsolidated subsidiaries        (98,501)         (41,282)
                                                     ----------       ----------
        Net cash used in investing activities         (205,485)        (120,425)


   Net decrease in cash and cash equivalents            (5,315)          (7,502)

   Cash and cash equivalents at beginning of period     81,919          100,154
                                                     ---------        ---------
   Cash and cash equivalents at end of period        $  76,604        $  92,652
                                                     =========        =========

<FN>
The  accompanying  notes as they relate to Cinergy Corp. are an integral part of
these consolidated financial statements.
</FN>
</TABLE>



<PAGE>





                      THE CINCINNATI GAS & ELECTRIC COMPANY

                            AND SUBSIDIARY COMPANIES




<PAGE>
<TABLE>
<CAPTION>







                      THE CINCINNATI GAS & ELECTRIC COMPANY
           CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME

                                                Quarter Ended
                                                   March 31
                                             2000           1999
                                            (dollars in thousands)
                                                 (unaudited)
<S>                                       <C>             <C>
Operating Revenues

  Electric                                $538,018        $481,586
  Gas                                      178,462         163,797
                                          --------        --------
    Total Operating Revenues               716,480         645,383


Operating Expenses

  Fuel and purchased and exchanged power   240,352         198,871
  Gas purchased                             89,616          78,878
  Operation and maintenance                105,047         108,156
  Depreciation and amortization             50,993          50,570
  Taxes other than income taxes             49,931          54,114
                                          --------        --------
    Total Operating Expenses               535,939         490,589

Operating Income                           180,541         154,794

Miscellaneous - Net                         (1,973)         (1,261)
Interest                                    25,749          24,407
                                          --------        --------
Income Before Taxes                        152,819         129,126

Income Taxes                                56,855          48,889
                                         ---------       ---------
Net Income                               $  95,964       $  80,237

Preferred Dividend Requirement                 213             214
                                         ---------       ---------
Net Income Applicable to Common Stock    $  95,751       $  80,023

Other Comprehensive Income (Loss),
  Net of Tax                                     -               -
                                         ---------       ---------
Comprehensive Income                     $  95,751       $  80,023
                                         =========       =========



<FN>
The  accompanying  notes as they relate to The Cincinnati Gas & Electric Company
are an integral part of these consolidated financial statements.
</FN>
</TABLE>


<PAGE>
<TABLE>
<CAPTION>





                     THE CINCINNATI GAS & ELECTRIC COMPANY
                           CONSOLIDATED BALANCE SHEETS


ASSETS
<S>                                                  <C>          <C>
                                                      March 31    December 31
                                                        2000         1999
                                                           (unaudited)
                                                      (dollars in thousands)

Current Assets

  Cash and cash equivalents                          $    4,186   $    9,554
  Restricted deposits                                       110          132
  Accounts receivable less accumulated provision for
    doubtful accounts of $17,386 at March 31, 2000,
    and $16,740 at December 31, 1999                    196,271      279,591
  Accounts receivable from affiliated companies          80,638       12,718
  Materials, supplies, and fuel - at average cost        85,745       98,999
  Energy risk management current assets                  95,145       63,926
  Prepayments and other                                  44,673       35,527
                                                     ----------   ----------
    Total Current Assets                                506,768      500,447


Utility Plant-Original Cost
  In service
    Electric                                          4,898,933    4,875,633
    Gas                                                 834,411      824,427
    Common                                              189,897      189,124
                                                      ---------    ---------
      Total                                           5,923,241    5,889,184
  Accumulated depreciation                            2,322,882    2,279,587
                                                      ---------    ---------
      Total                                           3,600,359    3,609,597
  Construction work in progress                         175,402      153,229
                                                      ---------    ---------
        Total Utility Plant                           3,775,761    3,762,826

Other Assets

  Regulatory assets                                     526,754      536,224
  Energy risk management non-current assets               9,953        7,368
  Other                                                 125,881      109,753
                                                     ----------   ----------
        Total Other Assets                              662,588      653,345



Total Assets                                         $4,945,117   $4,916,618
                                                     ==========   ==========



<FN>

The  accompanying  notes as they relate to The Cincinnati Gas & Electric Company
are an integral part of these consolidated financial statements.
</FN>
</TABLE>




<PAGE>
<TABLE>
<CAPTION>






                     THE CINCINNATI GAS & ELECTRIC COMPANY
                           CONSOLIDATED BALANCE SHEETS


LIABILITIES AND SHAREHOLDER'S EQUITY
<S>                                                 <C>          <C>

                                                      March 31    December 31
                                                        2000         1999
                                                           (unaudited)
                                                      (dollars in thousands)


Current Liabilities

  Accounts payable                                   $  220,540   $  253,115
  Accounts payable to affiliated companies               29,785       65,256
  Accrued taxes                                         165,117      136,118
  Accrued interest                                       10,832       17,375
  Notes payable and other short-term obligations        233,812      234,702
  Notes payable to affiliated companies                  54,051       60,360
  Energy risk management current liabilities             82,891       60,478
  Other                                                  26,667       25,468
                                                     ----------   ----------
    Total Current Liabilities                           823,695      852,872


Non-Current Liabilities

  Long-term debt                                      1,206,002    1,205,916
  Deferred income taxes                                 722,721      720,168
  Unamortized investment tax credits                    103,120      104,655
  Accrued pension and other postretirement
    benefit costs                                       156,993      154,718
  Energy risk management non-current liabilities         58,493       57,644
  Other                                                 152,159      140,794
                                                     ----------   ----------
    Total Non-Current Liabilities                     2,399,488    2,383,895



Total Liabilities                                     3,223,183    3,236,767

Cumulative Preferred Stock
  Not subject to mandatory redemption                    20,606       20,686

Common Stock Equity
  Common Stock-$8.50 par value; authorized
    shares-120,000,000; outstanding
    shares-89,663,086 at March 31, 2000 and
    December 31, 1999                                   762,136      762,136
  Paid-in capital                                       562,863      562,851
  Retained earnings                                     377,295      335,144
  Accumulated other comprehensive income (loss)            (966)        (966)
                                                     ----------   ----------
    Total Common Stock Equity                         1,701,328    1,659,165

Commitments and Contingencies (Note 4)

Total Liabilities and Shareholder's Equity           $4,945,117   $4,916,618
                                                     ==========   ==========



<FN>
The  accompanying  notes as they relate to The Cincinnati Gas & Electric Company
are an integral part of these consolidated financial statements.
</FN>
</TABLE>




<PAGE>
<TABLE>
<CAPTION>









                      THE CINCINNATI GAS & ELECTRIC COMPANY
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
<S>                                                  <C>             <C>
                                                            YEAR TO DATE
                                                              March 31
                                                        2000            1999
                                                       (dollars in thousands)
                                                             (unaudited)

Operating Activities
  Net income                                         $ 95,964        $  80,237
  Items providing or (using) cash currently:
    Depreciation and amortization                      50,993           50,570
    Deferred income taxes and investment
      tax credits-net                                   1,660            8,795
    Unrealized (gain) loss from energy risk
      management activities                           (10,542)         (11,500)
    Allowance for equity funds used
      during construction                                (734)            (775)
    Regulatory assets-net                               4,182            4,496
    Changes in current assets and current liabilities:
        Accounts and notes receivable                  12,569           80,619
        Materials, supplies, and fuel                  13,254           21,131
        Accounts payable                              (68,046)         (89,741)
        Accrued taxes and interest                     22,456          (20,010)
    Other items-net                                    (9,900)          (1,938)
                                                     --------        ---------
        Net cash provided by operating activities     111,856          121,884


Financing Activities
  Change in short-term debt                            (7,199)          86,977
  Redemption of long-term debt                              -         (110,000)
  Retirement of preferred stock                           (68)             (17)
  Dividends on preferred stock                           (214)            (214)
  Dividends on common stock                           (53,600)         (71,400)
                                                     --------        ---------
        Net cash used in financing activities         (61,081)         (94,654)

Investing Activities
  Construction expenditures (less allowance for
    equity funds used during construction)            (56,143)         (36,363)
                                                     --------        ---------
        Net cash used in investing activities         (56,143)         (36,363)


Net decrease in cash and cash equivalents              (5,368)          (9,133)

Cash and cash equivalents at beginning of period        9,554           26,989
                                                     --------        ---------
Cash and cash equivalents at end of period           $  4,186        $  17,856
                                                     ========        =========



<FN>
The  accompanying  notes as they relate to The Cincinnati Gas & Electric Company
are an integral part of these consolidated financial statements.
</FN>
</TABLE>


<PAGE>






                                PSI ENERGY, INC.
                             AND SUBSIDIARY COMPANY


















<PAGE>

<TABLE>
<CAPTION>




                                PSI ENERGY, INC.
           CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME

<S>                                           <C>             <C>
                                                    QUARTER ENDED
                                                      March 31
                                                 2000           1999
                                                (dollars in thousands)
                                                     (unaudited)

Operating Revenues

     Electric                                 $533,752         $482,465


Operating Expenses

    Fuel and purchased and exchanged power     271,429          234,927
    Operation and maintenance                  111,075          113,240
    Depreciation and amortization               34,960           33,743
    Taxes other than income taxes               14,609           14,488
                                              --------         --------
     Total Operating Expenses                  432,073          396,398


Operating Income                               101,679           86,067

Miscellaneous - Net                               (859)             323
Interest                                        20,084           21,364

Income Before Taxes                             80,736           65,026
                                             ---------        ---------

Income Taxes                                    30,523           25,185
                                             ---------        ---------
Net Income                                    $ 50,213         $ 39,841

Preferred Dividend Requirement                   1,150            1,150
                                             ---------        ---------
Net Income Applicable to Common Stock         $ 49,063         $ 38,691

Other Comprehensive Income (Loss),
  Net of Tax                                       632              (15)
                                            ----------        ---------
Comprehensive Income                         $  49,695        $  38,676
                                            ==========        =========



<FN>
The accompanying  notes as they relate to PSI Energy,  Inc. are an integral part
of these consolidated financial statements.
</FN>
</TABLE>




<PAGE>


<TABLE>
<CAPTION>




                                PSI ENERGY, INC.
                           CONSOLIDATED BALANCE SHEETS


ASSETS
<S>                                            <C>                  <C>
                                                  March 31         December 31
                                                    2000               1999
                                                          (unaudited)
                                                    (dollars in thousands)

Current Assets

 Cash and cash equivalents                     $   23,917           $    8,842
 Restricted deposits                                   52                    -
 Notes receivable                                     583                  481
 Notes receivable from affiliated companies        54,051               60,360
 Accounts receivable less accumulated
   provision for doubtful accounts of
   $9,898 at March 31, 2000, and $9,934
   at December 31, 1999                           252,559              253,022
 Accounts receivable from affiliated companies      3,118               42,715
 Materials, supplies, and fuel - at average cost   85,686              103,490
 Energy risk management current assets             95,145               63,927
 Prepayments and other                             39,905               36,173
                                              -----------        -------------
     Total Current Assets                         555,016              569,010



Electric Utility Plant-Original Cost

 In service                                     4,572,207            4,539,111
 Accumulated depreciation                       2,014,495            1,980,290
                                               ----------           ----------
    Total                                       2,557,712            2,558,821
                                               ----------           ----------
 Construction work in progress                    113,988               95,825
                                               ----------           ----------
        Total Electric Utility Plant            2,671,700            2,654,646



Other Assets
 Regulatory assets                                504,147              518,788
 Energy risk management non-current assets          9,953                7,368
 Other                                             89,069               85,024
                                                ---------           ----------
        Total Other Assets                        603,169              611,180


Total Assets                                   $3,829,885           $3,834,836
                                               ==========           ==========



<FN>
The accompanying  notes as they relate to PSI Energy,  Inc. are an integral part
of these consolidated financial statements.
</FN>
</TABLE>




<PAGE>

<TABLE>
<CAPTION>





                                PSI ENERGY, INC.
                          CONSOLIDATED BALANCE SHEETS


LIABILITIES AND SHAREHOLDER'S EQUITY
<S>                                           <C>                   <C>

                                               March 31           December 31
                                                 2000                 1999
                                                       (unaudited)
                                                 (dollars in thousands)


Current Liabilities

 Accounts payable                             $  193,880            $  241,072
 Accounts payable to affiliated companies         96,851                 6,762
 Accrued taxes                                    89,522                93,056
 Accrued interest                                 22,886                26,989
 Notes payable and other short-term
   obligations                                   155,508               232,597
 Notes payable to affiliated companies                 -                 6,707
 Long-term debt due within one year               31,871                31,000
 Energy risk management current liabilities       82,891                60,478
 Other                                             2,416                 1,986
                                              ----------            ----------
   Total Current Liabilities                     675,825               700,647


Non-Current Liabilities

 Long-term debt                                1,210,923             1,211,552
 Deferred income taxes                           457,484               460,748
 Unamortized investment tax credits               42,066                42,895
 Accrued pension and other postretirement
   benefit costs                                 133,463               129,103
 Energy risk management non-current
   liabilities                                    58,493                57,645
 Other                                            92,365               104,638
                                               ---------             ---------
   Total Non-Current Liabilities               1,994,794             2,006,581



Total Liabilities                              2,670,619             2,707,228
                                               ---------             ---------
Cumulative Preferred Stock
 Not subject to mandatory redemption              71,851                71,911


Common Stock Equity

 Common Stock-without par value; $.01
   stated value; authorized shares-
   60,000,000; outstanding shares-
   53,913,701 at March 31, 2000 and
   December 31, 1999                                 539                   539
 Paid-in capital                                 411,220               411,198
 Retained earnings                               673,633               642,569
 Accumulated other comprehensive income
   (loss)                                          2,023                 1,391
                                               ---------             ---------
   Total Common Stock Equity                   1,087,415             1,055,697


Commitments and Contingencies (Note 4)

Total Liabilities and Shareholder's Equity    $3,829,885           $3,834,836
                                              ==========           ==========



<FN>
The accompanying  notes as they relate to PSI Energy,  Inc. are an integral part
of these consolidated financial statements.
</FN>
</TABLE>




<PAGE>


<TABLE>
<CAPTION>





                                PSI ENERGY, INC.
                     CONSOLIDATED STATEMENTS OF CASH FLOWS


                                                      YEAR TO DATE
                                                        March 31

                                                    2000       1999
                                                 (dollars in thousands)
                                                      (unaudited)
<S>                                             <C>          <C>

Operating Activities

 Net income                                     $  50,213    $  39,841
 Items providing or (using) cash currently:
   Depreciation and amortization                   34,960       33,743
   Deferred income taxes and investment tax
     credits-net                                   (2,166)      (3,476)
   Unrealized (gain) loss from energy risk
     management activities                        (10,542)     (11,500)
   Allowance for equity funds used during
     construction                                    (168)           -
   Regulatory assets-net                            2,671         644
   Changes in current assets and current
     liabilities:
       Restricted deposits                            (52)         (54)
       Accounts and notes receivable               48,533       85,834
       Materials, supplies, and fuel               17,804       (3,344)
       Accounts payable                            42,897      (94,074)
       Accrued taxes and interest                  (7,637)      20,950
   Other items-net                                 (7,214)       7,593
                                                 ----------    ---------
Net cash provided by operating activities         169,299       76,157


Financing Activities

 Change in short-term debt                        (83,796)    (15,419)
 Redemption of long-term debt                        (150)     (6,000)
 Retirement of preferred stock                        (37)         (3)
 Dividends on preferred stock                      (1,150)     (1,150)
 Dividends on common stock                        (18,000)          -
                                               -----------  ----------
Net cash used in financing activities            (103,133)    (22,572)


Investing Activities

 Construction expenditures (less allowance
  for equity funds used during construction)      (51,091)    (41,186)
                                               -----------  ----------
Net cash used in investing activities             (51,091)    (41,186)


Net increase in cash and cash equivalents          15,075      12,399

Cash and cash equivalents at beginning of period    8,842      18,788
                                                 ----------   ---------
Cash and cash equivalents at end of period      $  23,917   $  31,187
                                                ===========   =========



<FN>
The accompanying  notes as they relate to PSI Energy,  Inc. are an integral part
of these consolidated financial statements.
</FN>
</TABLE>


<PAGE>






                     THE UNION LIGHT, HEAT AND POWER COMPANY


















<PAGE>


<TABLE>
<CAPTION>










                     THE UNION LIGHT, HEAT AND POWER COMPANY
                  STATEMENTS OF INCOME AND COMPREHENSIVE INCOME


                                                            QUARTER ENDED
                                                               March 31
                                                          2000          1999
                                                        (dollars in thousands)
                                                              (unaudited)
<S>                                                     <C>           <C>

Operating Revenues
  Electric                                              $49,288       $49,159
  Gas                                                    33,487        33,000
                                                        -------       -------
   Total Operating Revenues                              82,775        82,159

Operating Expenses
  Electricity purchased from parent company
   for resale                                            35,211        36,748
  Gas purchased                                          17,994        17,322
  Operation and maintenance                               9,228        10,190
  Depreciation and amortization                           3,736         3,571
  Taxes other than income taxes                           1,098         1,083
                                                        -------       -------
   Total Operating Expenses                              67,267        68,914

Operating Income                                         15,508        13,245

Miscellaneous - Net                                        (191)         (390)
Interest                                                  1,571         1,563
                                                        -------       -------
Income Before Taxes                                      13,746        11,292


Income Taxes                                              5,600         4,749
                                                       --------      --------
Net Income Applicable to Common Stock                   $ 8,146       $ 6,543

Other Comprehensive Income (Loss), Net of Tax                 -             -
                                                       --------      --------
Comprehensive Income                                   $  8,146      $  6,543
                                                       ========      ========



<FN>
The accompanying notes as they relate to The Union Light, Heat and Power Company
are an integral part of these financial statements.
</FN>
</TABLE>




<PAGE>




<TABLE>
<CAPTION>



                     THE UNION LIGHT, HEAT AND POWER COMPANY
                                 BALANCE SHEETS








ASSETS
<S>                                               <C>                  <C>

                                                  March 31          December 31
                                                    2000                1999
                                                          (unaudited)
                                                    (dollars in thousands)

Current Assets

 Cash and cash equivalents                        $  1,900             $  3,641
 Accounts receivable less accumulated
  provision for doubtful accounts of $1,500
  at March 31, 2000, and $1,513 at
  December 31, 1999                                  9,476               17,786
 Accounts receivable from affiliated companies         881                  775
 Materials, supplies, and fuel - at average cost     3,216                7,654
 Prepayments and other                                 107                  219
                                                  --------            ---------
    Total Current Assets                            15,580               30,075


Utility Plant - Original Cost
 In service
  Electric                                         224,097              222,035
  Gas                                              177,034              173,011
  Common                                            42,457               42,351
                                                  --------            ---------
    Total                                          443,588              437,397
 Accumulated depreciation                          158,655              154,607
                                                  --------            ---------
    Total                                          284,933              282,790
 Construction work in progress                      14,639               13,761
                                                  --------            ---------
    Total Utility Plant                            299,572              296,551


Other Assets

 Regulatory assets                                  10,420               10,639
 Other                                               5,928                5,000
                                                  --------            ---------
    Total Other Assets                              16,348               15,639


Total Assets                                      $331,500             $342,265
                                                  ========            =========



<FN>
The accompanying notes as they relate to The Union Light, Heat and Power Company
are an integral part of these financial statements.
</FN>
</TABLE>




<PAGE>
<TABLE>
<CAPTION>






                     THE UNION LIGHT, HEAT AND POWER COMPANY

                                 BALANCE SHEETS











LIABILITIES AND SHAREHOLDER'S EQUITY
<S>                                              <C>                  <C>
                                                  March 31          December 31
                                                    2000                1999
                                                          (unaudited)
                                                     (dollars in thousands)

Current Liabilities

 Accounts payable                                $  6,279             $  8,487
 Accounts payable to affiliated companies          14,088               20,122
 Accrued taxes                                      6,852                  739
 Accrued interest                                     552                1,298
 Notes payable to affiliated companies             19,137               37,752
 Other                                              5,211                4,062
                                                 --------             --------
  Total Current Liabilities                        52,119               72,460

Non-Current Liabilities
 Long-term debt                                    74,565               74,557
 Deferred income taxes                             21,947               23,000
 Unamortized investment tax credits                 3,892                3,961
 Accrued pension and other postretirement
   benefit costs                                   12,497               12,333
 Amounts due to customers - income taxes           11,895               11,308
 Other                                             14,389               12,596
                                                 --------             --------
  Total Non-Current Liabilities                   139,185              137,755

Total Liabilities                                 191,304              210,215

Common Stock Equity

 Common Stock-$15.00 par value; authorized
   shares- 1,000,000; outstanding shares-
   585,333 at March 31, 2000
   and December 31, 1999                            8,780                8,780
 Paid-in capital                                   20,142               20,142
 Retained earnings                                111,274              103,128
                                                 --------             --------
  Total Common Stock Equity                       140,196              132,050


Commitments and Contingencies (Note 4)

Total Liabilities and Shareholder's Equity       $331,500             $342,265
                                                 ========             ========



<FN>
The accompanying notes as they relate to The Union Light, Heat and Power Company
are an integral part of these financial statements.
</FN>
</TABLE>




<PAGE>
<TABLE>
<CAPTION>






                     THE UNION LIGHT, HEAT AND POWER COMPANY

                            STATEMENTS OF CASH FLOWS


<S>                                                   <C>            <C>
                                                            YEAR TO DATE
                                                              March 31
                                                          2000        1999
                                                        (dollars in thousands)
                                                             (unaudited)

Operating Activities

 Net income                                           $  8,146        $  6,543
 Items providing or (using) cash currently:
  Depreciation and amortization                          3,736           3,571
  Deferred income taxes and investment tax
    credits - net                                         (536)           (200)
  Allowance for equity funds used during construction        -              16
  Regulatory assets - net                                  169              35
  Changes in current assets and current liabilities:
   Accounts and notes receivable                         7,351           4,006
   Materials, supplies, and fuel                         4,438           4,601
   Accounts payable                                     (8,242)          1,422
   Accrued taxes and interest                            5,367           2,873
  Other items - net                                      3,514           4,286
                                                      --------        ---------
      Net cash provided by operating activities         23,943          27,153

Financing Activities

 Change in short-term debt                             (18,615)        (20,431)
                                                      ---------       ---------
      Net cash used in financing activities            (18,615)        (20,431)

Investing Activities

 Construction expenditures (less allowance for equity
    funds used during construction)                     (7,069)         (4,973)
                                                      ---------       ---------
      Net cash used in investing activities             (7,069)         (4,973)


Net increase (decrease) in cash and cash equivalents    (1,741)          1,749

Cash and cash equivalents at beginning of period         3,641           3,244
                                                      ---------       ---------
Cash and cash equivalents at end of period            $  1,900        $  4,993
                                                      =========       =========



<FN>
The accompanying notes as they relate to The Union Light, Heat and Power Company
are an integral part of these financial statements.
</FN>
</TABLE>





<PAGE>




NOTES TO FINANCIAL STATEMENTS

1.  Summary of Significant Accounting Policies

(a)  Presentation  These Financial  Statements  reflect all  adjustments  (which
include  normal,   recurring  adjustments)  necessary  in  the  opinion  of  the
registrants for a fair  presentation of the interim  results.  These  statements
should  be read in  conjunction  with the  Financial  Statements  and the  notes
thereto included in the combined 1999 Form 10-K of the registrants.

Certain  amounts in the 1999  Financial  Statements  have been  reclassified  to
conform to the 2000 presentation.

(b) Energy Marketing and Trading We market and trade  electricity,  natural gas,
and other  energy-related  products.  We designate  transactions  as physical or
trading  at the time they are  originated.  Physical  refers to our  intent  and
projected  ability to fulfill  obligations from  company-owned  assets.  We sell
generation  to  third  parties  when  it is not  required  to meet  native  load
requirements  (end-use  customers  within  our  operating  companies'  franchise
service territory).  We account for physical  transactions on a settlement basis
and trading  transactions using the mark-to-market  method of accounting.  Under
the mark-to-market method of accounting,  trading transactions are shown at fair
value in our  consolidated  balance  sheets as energy risk  management  assets -
current and  non-current,  and energy risk management  liabilities - current and
non-current.  We reflect changes in fair value resulting in unrealized gains and
losses in fuel and purchased and exchanged  power and gas  purchased.  We record
the revenues and costs for all  transactions in our  consolidated  statements of
income when the  contracts  are  settled.  We  recognize  revenues in  operating
revenues;  costs are recorded in fuel and purchased and exchanged  power and gas
purchased.

Although we intend to settle physical contracts with  company-owned  generation,
there are times when we have to settle these  contracts with power  purchased on
the open trading markets.  The cost of these purchases could be in excess of the
associated  revenues.  We recognize the gains or losses on these transactions as
the  power  is  delivered.  Open  market  purchases  may  occur  for some of the
following reasons:

     *    generating station outages;

     *    least-cost alternative;

     *    native load requirements; and

     *    extreme weather.

We value  contracts  in the trading  portfolio  using  end-of-the-period  market
prices, utilizing the following factors (as applicable):

     *    closing  exchange  prices (that is,  closing  prices for  standardized
          electricity  products traded on an organized  exchange such as the New
          York Mercantile Exchange);

     *    broker-dealer and over-the-counter price quotations; and

     *    model pricing (which  considers  time value and historical  volatility
          factors of electricity  pricing underlying any options and contractual
          commitments).

We anticipate that some of these  obligations,  even though  considered  trading
contracts, will ultimately be settled using company-owned  generation.  The cost
of this  generation  is  usually  below the  market  price at which the  trading
portfolio has been valued.

Earnings  volatility  results from period to period due to the risks  associated
with marketing and trading  electricity,  natural gas, and other  energy-related
products.

(c) Financial Derivatives We use derivative financial instruments to manage: (1)
funding  costs;  (2)  exposures  to  fluctuations  in  interest  rates;  and (3)
exposures to foreign currency exchange rates.  These financial  instruments must
be designated as a hedge (for example, an offset of foreign exchange or interest
rate risks) at the  inception  of the contract and must be effective at reducing
the risk associated with the underlying instrument.  An underlying instrument is
one that gives rise to the  derivative  financial  instrument,  for  example,  a
foreign currency denominated contract. Accordingly, changes in the market values
of instruments  designated as hedges must be highly  correlated  with changes in
the market values of the underlying instrument.

From time to time,  we may  utilize  foreign  exchange  forward  contracts  (for
example,  a  contract  obligating  one party to buy,  and the  other to sell,  a
specified quantity of a foreign currency for a fixed price at a future date) and
currency swaps (for example,  a contract whereby two parties exchange  principal
and interest cash flows denominated in different currencies) to hedge certain of
our net investments in foreign  operations.  Accordingly,  any translation gains
and losses are recorded in accumulated other comprehensive  income (loss), which
is a component of Common stock equity.  Aggregate  translation losses related to
these  instruments are reflected net in current  liabilities in our Consolidated
Balance Sheets. At March 31, 2000, no such instruments were held.

We also use  interest  rate  swaps (an  agreement  by two  parties  to  exchange
fixed-interest  rate cash flows for  floating-interest  rate cash flows). We use
the accrual method to account for these interest rate swaps. Accordingly,  gains
and losses are calculated based on the difference between the fixed-rate and the
floating-rate interest amounts, using agreed upon principal amounts. These gains
and  losses  are  recognized  in our  Consolidated  Statements  of  Income  as a
component of Interest over the life of the agreement.

(d)  Accounting  Changes  During  the  second  quarter  of 1998,  the  Financial
Accounting  Standards  Board (FASB)  issued  Statement  of Financial  Accounting
Standards No. 133, Accounting for Derivative  Instruments and Hedging Activities
(Statement  133).  This  standard   requires   companies  to  record  derivative
instruments  as assets or  liabilities,  measured at fair value.  Changes in the
derivative's fair value must be recognized currently in earnings unless specific
hedge accounting criteria are met. Hedges are transactions  entered into for the
purpose of reducing  exposure to one or more types of business  risk.  Gains and
losses on derivatives  that qualify as hedges can offset related  results on the
hedged item in the income statement.

This  standard,  as  subsequently  amended by Statement of Financial  Accounting
Standards  No.  137,   Accounting   for  Derivative   Instruments   and  Hedging
Activities-Deferral  of the Effective Date of FASB Statement  No.133  (Statement
137), is effective for fiscal years  beginning  after June 15, 2000. The purpose
of Statement 137 was to delay the  effective  date of Statement 133 by one year.
We expect to reflect the  adoption  of this  standard  in  financial  statements
issued  beginning in the first quarter of 2001. In recognition of the complexity
of this new standard,  the Derivatives  Implementation  Group has been formed by
the FASB. In preparation for our  implementation  of this new standard,  we have
formed a  cross-functional  project team.  The project team is  identifying  and
analyzing all contracts  which could be subject to the new standard,  developing
required  documentation,  defining  relevant  processes and information  systems
needs,  and  promoting  internal  awareness of the  requirements  and  potential
effects  of the new  standard.  While we  continue  to  analyze  and  follow the
development of implementation  guidelines, at this time we are unable to predict
whether the  implementation of this accounting  standard will be material to our
results of operations and financial position. However, the adoption of Statement
133 could increase volatility in earnings and other comprehensive income.

2.   Change in Preferred Stock of Subsidiaries

On January 14, 2000, The Cincinnati  Gas & Electric  Company (CG&E)  repurchased
700 shares of its 4 3/4% Series Cumulative Preferred Stock at a redemption price
of $84.21 per share.  On February 18, 2000, PSI Energy,  Inc. (PSI)  repurchased
600 shares of its 3 1/2% Series Cumulative Preferred Stock at a redemption price
of $62 per share.

3.   Long-Term Debt

On February 15, 2000,  PSI retired  $150,000  principal  amount of its Series YY
First Mortgage Bonds.

4.   Commitments and Contingencies

(a)  Ozone Transport RulemakinG

     (i)  NOx  SIP  Call  Ozone  transport  refers  to  wind-blown  movement  of
ozone-causing  materials across city and state  boundaries.  As discussed in the
1999 Form 10-k, in October  1998,  the United  States  Environmental  Protection
Agency (EPA) finalized its ozone transport rule, also known as the NOx SIP call.
(A SIP is a state's  implementation plan for achieving  emissions  reductions to
address air quality  concerns.)  It applied to 22 states in the eastern  half of
the United  States  (U.S.),  including  the three  states in which our  electric
utilities  operate,  and also  proposes a model  nitrogen  oxide (NOx)  emission
allowance  trading  program.  If implemented by the states,  the trading program
would  allow  us to buy NOx  emission  allowances  from,  or sell  nox  emission
allowances to, other  companies as necessary.  This rule  recommends that states
reduce NOx emissions  primarily from industrial and utility sources to a certain
level by May 2003. The EPA gave the affected states until September 30, 1999, to
incorporate  NOx  reductions  and,  in the  discretion  of the state,  a trading
program  into their  SIPs.  The EPA  proposed  to  implement  a federal  plan to
accomplish the equivalent NOx reductions by May 2003, if states failed to revise
their SIPs. The EPA must approve all SIPs.

Ohio,  Indiana,  a number of other states,  and various industry groups (some of
which we are a member) filed legal  challenges to the Nox SIP Call in late 1998.
On May 25, 1999, the U.S.  Circuit Court of Appeals for the District of Columbia
(Court of Appeals) granted a request for a deferral of the rule and indefinitely
suspended the September 30 filing deadline,  pending further review by the Court
of Appeals.

In March 2000,  the Court of Appeals  substantially  upheld the EPA's  rule.  On
April 11,  2000,  the EPA asked the Court of Appeals to remove its May 25, 1999,
suspension  of the rule and also  directed the states to submit SIP revisions by
September 1, 2000. On April 17, 2000,  various states and industry  groups (some
of which we are a  member)  filed a  request  with the  court of  appeals  for a
rehearing of the NOx SIP Call decisions. On April 24, 2000, the same group filed
a request  with the Court of Appeals to (1) obtain more time to file their SIPs,
and (2) require  rulemaking  and a comment  period to determine a new compliance
date.  Nevertheless,  the states  will have to begin  adopting  new  regulations
requiring implementation of the requirements of the October 1998 ozone transport
rulemaking this year.

We estimate the capital  expenditures  for  compliance  with the NOx SIP Call at
$500  million to $700  million  (in 1999  dollars)  by May 2003.  This  estimate
depends on several factors, including:

     *    final  determination  regarding  both the timing and strictness of the
          final NOx  reductions  required  by the SIPs  adopted by the states in
          which we operate;

     *    utilization of our generating units;

     *    availability of adequate  supplies of materials and labor to construct
          the necessary control equipment; and

     *    whether a viable market will exist to buy and sell NOx allowances.

     (ii) Section 126 Petitions As discussed in the 1999 Form 10-K, in February
1998,  the  northeast states filed  petitions  seeking the EPA's  assistance in
reducing ozone in the eastern U.S. under Section 126 of the Clean Air Act (CAA).
The EPA believes that Section 126 petitions  allow a state to claim that another
state is  contributing  to its air  quality  problem  and  request  that the EPA
require the upwind state to reduce its emissions.

In December  1999,  the EPA granted four Section 126  petitions  relating to NOx
emissions.  This ruling affects all of our Ohio and Kentucky facilities, as well
as some of our Indiana  facilities,  and requires us to reduce our NOx emissions
to a certain  level by May 2003.  The EPAs  action  granting  the  Section  126
petitions has been appealed in the court of appeals.  In April 2000, the parties
to the appeal filed a proposed  scheduling order,  which if approved,  would set
oral  arguments in late 2000,  with a court  decision  expected in the spring of
2001.  We currently  cannot  predict the outcome of this  proceeding.  We do not
anticipate that any Section 126 rules will have any significant financial impact
in addition to that of the NOx SIP Call.

     (iii) State Ozone Plans as discussed in the 1999 Form 10-K, on November 15,
1999,  the  State of  Indiana  and the  Commonwealth  of  Kentucky  (along  with
Jefferson County, Kentucky) jointly filed an amendment to their SIPs on how they
intend to bring the greater Louisville area,  including Floyd and Clark Counties
in Indiana, into attainment with the one-hour ozone standard. The SIP amendments
call for, among other things,  statewide  NOx  reductions  from  utilities  in
Indiana, Kentucky, and surrounding  states which are less  stringent than the
EPA's NOx SIP Call. The states of Indiana and Kentucky have committed to adopt
utility  NOx control rules by December  2000 that would require  controls be
installed by May 2003. The states are waiting for further guidance from the EPA
on how the NOx SIP Call and the state  rules  should be  coordinated.  Since the
state  rules are the legal  mechanism  through  which the SIP  requirements  are
imposed on regulated  facilities,  we do not anticipate that the State NOx rules
will have any significant  financial  impact in addition to that of the NOx SIP
Call.

(b) New Source  Review (NSR) As  discussed in the 1999 Form 10-K,  the CAA's NSR
provisions require that a company obtain a  pre-construction  permit if it plans
to build a new  stationary  source  of  pollution  or make a major  change to an
existing facility unless the changes are exempt. In July 1998, the EPA requested
comments  on  proposed  revisions  to  the  NSR  rules  that  would  change  NSR
applicability by eliminating exemptions contained in the current regulation.  We
believe that if these changes are finalized,  it will be significantly harder to
maintain our facilities without triggering the NSR permit requirements.

Since July 1999,  CG&E and PSI have  received  requests from the EPA (Region 5),
under  Section  114 of the CAA,  seeking  documents  and  information  regarding
capital and maintenance  expenditures at several of their respective  generating
stations. These activities are part of an industry-wide  investigation assessing
compliance  with  the  NSR  and  the New  Source  Performance  Standards  (NSPS,
emissions  standards that apply to new and changed units) of the CAA at electric
generating stations.

On September 15, 1999,  and on November 3, 1999,  the  Attorneys  General of the
States  of New York and  Connecticut,  respectively,  issued  letters  notifying
Cinergy (Cinergy Corp. and all of its regulated and non-regulated  subsidiaries)
and CG&E of their intent to sue under the citizens  suit  provisions of the CAA.
New  York and  Connecticut  allege  violations  of the CAA by  constructing  and
continuing to operate a major change to CG&E's W.C. Beckjord Station  (Beckjord)
without obtaining the required NSR pre-construction permits.

On November 3, 1999,  the EPA sued a number of holding  companies  and  electric
utilities,  including  Cinergy,  CG&E, and PSI, in various U.S. District Courts.
The Cinergy,  CG&E,  and PSI suit alleges  violations  of the CAA at some of our
generating  stations relating to NSR and NSPS  requirements.  The suit seeks (1)
injunctive  relief to require  installation of pollution  control  technology on
each of the  generating  units at Beckjord and PSI's Cayuga  Generating  Station
(Cayuga),  and (2) civil  penalties in amounts of up to $27,500 per day for each
violation.

On March 1, 2000, the EPA filed an amended complaint against Cinergy,  CG&E, and
PSI. The amended complaint added the alleged  violations of the NSR requirements
of the CAA  contained  in the  notice  of  violation  (NOV)  filed by the EPA on
November 3, 1999.

It also added claims for relief alleging  violations of (1)  nonattainment  NSR,
(2)  Indiana  and Ohio SIPs,  and (3)  particulate  matter  emission  limits (as
discussed in Note 4(d) on page 30). The amended  complaint  seeks (1) injunctive
relief to require  installation of pollution  control  technology on each of the
generating  units at Beckjord,  Cayuga,  and PSI's  Wabash  River and  Gallagher
Generating  Stations,  and such  other  measures  as  necessary,  and (2)  civil
penalties in amounts of up to $27,500 per day for each violation. We believe the
allegations  contained in the amended  complaint  are without  merit and plan to
defend  the suit  vigorously  in court.  At this  time,  it is not  possible  to
determine  the  likelihood  that the EPA will  prevail  on its claims or whether
resolution  of  this  matter  will  have a  material  effect  on  our  financial
condition.  In addition,  we cannot predict  whether any additional  allegations
will be added to this proceeding.

On March 1, 2000, the EPA also filed an amended complaint alleging violations of
the CAA relating to NSR, Prevention of Significant  Deterioration,  and Ohio SIP
requirements  regarding a generating  station operated by the Columbus  Southern
Power  Company  (CSP)  and  jointly-owned  by CSP,  The  Dayton  Power and Light
Company,  and CG&E. The EPA is seeking  injunctive relief and civil penalties of
up to $27,500  per day for each  violation.  We believe the  allegations  in the
amended  complaint  are  without  merit.  At this time,  it is not  possible  to
determine  the  likelihood  that the EPA will  prevail  on its claims or whether
resolution  of  this  matter  will  have a  material  effect  on  our  financial
condition.

(c) Manufactured Gas PlanT (MGP) Sites

     (i) GeneraL As discussed in the 1999 Form 10-K, prior to the 1950s, gas was
produced at MGP sites through a process that involved the heating of coal and/or
oil. The gas produced  from this process was sold for  residential,  commercial,
and industrial uses.

     (ii)  PSI Coal tar  residues,  related  hydrocarbons,  and  various  metals
associated  with MGP sites  have  been  found at  former  MGP sites in  Indiana,
including at least 21 sites which PSI or its predecessors  previously owned. PSI
acquired four of the sites from Northern Indiana Public Service Company (NIPSCO)
in 1931.  At the same  time,  PSI sold  NIPSCO  the sites  located in Goshen and
Warsaw,  Indiana.  In 1945, PSI sold 19 of these sites (including the four sites
it acquired  from NIPSCO) to the  predecessor  of the Indiana Gas Company,  Inc.
(IGC). IGC later sold the site located in Rochester, Indiana, to NIPSCO.

IGC (in 1994) and NIPSCO (in 1995) both made claims  against  PSI.  The basis of
these claims was that PSI is a Potentially Responsible Party with respect to the
21 MGP sites under the Comprehensive  Environmental  Response,  Compensation and
Liability  Act  (CERCLA).  The claims  further  asserted  that PSI is  therefore
legally responsible for the costs of investigating and remediating the sites. In
August 1997,  NIPSCO filed suit against PSI in federal court  claiming  recovery
(pursuant  to CERCLA) of NIPSCO's  past and future  costs of  investigating  and
remediating MGP-related contamination at the Goshen MGP site.

In November 1998,  NIPSCO,  IGC, and PSI entered into a Site  Participation  and
Cost Sharing  Agreement.  The agreement  allocated CERCLA liability for past and
future  costs at seven MGP sites in  Indiana  among  the three  companies.  As a
result of the agreement, NIPSCO's lawsuit against PSI was dismissed. The parties
have  assigned  lead  responsibility  for  managing  further  investigation  and
remediation  activities  at each of the  sites  to one of the  parties.  Similar
agreements were reached between IGC and PSI that allocate CERCLA liability at 14
MGP sites with which  NIPSCO was not  involved.  These  agreements  conclude all
CERCLA and similar claims between the three companies  related to MGP sites. The
parties  continue to investigate and remediate the sites,  as appropriate  under
the  agreements and applicable  laws.  The Indiana  Department of  Environmental
Management (IDEM) oversees investigation and cleanup of some of the sites.

PSI notified its insurance carriers of the claims related to MGP sites raised by
IGC,  NIPSCO,  and the IDEM. In April 1998,  PSI filed suit in Hendricks  County
Circuit Court in the State of Indiana  against its general  liability  insurance
carriers.  Among other matters,  PSI requested a declaratory judgment that would
obligate its insurance carriers to (1) defend MGP claims against PSI, or (2) pay
PSI's  costs of  defense  and  compensate  PSI for its  costs of  investigating,
preventing,  mitigating,  and  remediating  damage to property and paying claims
related to MGP sites.  The case was moved to the Hendricks County Superior Court
1 on a request for a change of judge.  The Hendricks County Superior Court 1 has
set the case for trial  beginning  in May 2001.  It ordered  the parties to meet
certain  deadlines for  discovery  proceedings  based upon this trial date.  PSI
cannot predict the outcome of this litigation.  Recently,  PSI has been involved
in settlement  discussions with some of the insurance  carriers.  At the present
time, PSI cannot predict either the progress or outcome of these discussions.

PSI has accrued costs for the sites related to investigation,  remediation,  and
groundwater  monitoring for the work performed to date. The estimated  costs for
such  remedial  activities  are accrued  when the costs are  probable and can be
reasonably  estimated.  PSI does not  believe it can  provide an estimate of the
reasonably  possible  total  remediation  costs for any site  before a  remedial
investigation/feasibility study has been completed. To the extent remediation is
necessary,  the  timing  of the  remediation  activities  impacts  the  cost  of
remediation.  Therefore, PSI currently cannot determine the total costs that may
be incurred in connection  with the remediation of all sites, to the extent that
remediation is required. According to current information, these future costs at
the 21 Indiana MGP sites are not material to our financial  condition or results
of operations. As further investigation and remediation activities are performed
at these sites,  the potential  liability for the 21 MGP sites could be material
to our financial position or results of operations.

     (iii) CG&E CG&E and its utility  subsidiaries  are aware of potential sites
where MGP activities have occurred at some time in the past. None of these sites
is known to present a risk to the environment. CG&E and its utility subsidiaries
have begun  preliminary  site  assessments to obtain  information  about some of
these MGP sites.

(d) Other As  discussed in the 1999 Form 10-K,  on November  30,  1999,  the EPA
filed a NOV against  Cinergy and CG&E  alleging  that  emissions of  particulate
matter at Beckjord  exceeded the allowable limit. The NOV indicated that the EPA
may (1)  issue an  administrative  penalty  order,  or (2)  file a civil  action
seeking  injunctive relief and civil penalties of up to $27,500 per day for each
violation.  The allegations  contained in this NOV were incorporated  within the
March 1, 2000, amended  complaint,  as discussed in Note 4(b) on page 28. We are
currently  unable to  determine  whether  resolution  of this matter will have a
material effect on our financial condition.




<PAGE>





5.   Financial Information by Business Segment

As discussed in the 1999 Form 10-K,  during 1998, we adopted the requirements of
Statement of Financial  Accounting Standards No. 131, Disclosures about Segments
of an Enterprise and Related Information (Statement 131). Statement 131 requires
disclosures about reportable  operating segments in annual and interim condensed
financial statements.

The Energy Commodities  Business Unit  (Commodities)  operates and maintains our
domestic electric  generating  plants and some of our  jointly-owned  plants. It
also  conducts the following  activities:  (1)  wholesale  energy  marketing and
trading, (2) energy risk management,  (3) financial  restructuring services, and
(4) proprietary arbitrage  activities.  Commodities earns revenues from external
customers  from  its  marketing,   trading,  and  risk  management   activities.
Commodities earns  intersegment  revenues from the sale of electric power to the
Energy Delivery Business Unit (Delivery).

Delivery plans,  constructs,  operates,  and maintains our operating  companies'
transmission  and  distribution  systems and provides gas and electric energy to
consumers. Delivery earns revenues from customers other than consumers primarily
by  transmitting  electric  power  through  our  transmission  system.  Delivery
currently  receives all of its electricity  from Commodities at a transfer price
based upon current regulatory ratemaking methodology.

The Cinergy Investments  Business Unit (Cinergy  Investments)  primarily manages
the development,  marketing,  and sales of our  non-regulated  retail energy and
energy-related  products and  services.  This is  accomplished  through  various
subsidiaries and joint ventures.  Cinergy  Investments earns all of its revenues
from the  sale of such  products  and  services  to  ultimate  consumers.  These
products and services include the following:

     *    energy management and consulting services to commercial customers that
          operate retail  facilities  (for example,  finding more efficient ways
          for a customer to use energy);

     *    utility operations/services to other utilities (for example, providing
          underground locating and construction services for other utilities);

     *    building,   operating,   and  maintaining   combined  heat  and  power
          facilities through joint ventures with Trigen Energy Corporation; and

     *    building and maintaining  fiber optic  telecommunication  networks for
          businesses, municipalities, telecommunications carriers, and schools.

The  International  Business  Unit  (International)   directs  and  manages  our
international  business  holdings,   which  include  wholly-  and  jointly-owned
companies  in  six  countries.  In  addition,  International  also  directs  our
renewable energy investing activities (for example,  wind farms) both inside and
outside the U.S.  International earns (1) revenues, and (2) equity earnings from
unconsolidated companies primarily from energy-related businesses.




<PAGE>

<TABLE>
<CAPTION>




Financial  results by business unit for the quarters  ended March 31, 2000,  and
1999,  and total segment assets at March 31, 2000, and December 31, 1999, are as
follows:

-----------------------------------------------------------------------------------------------------------------------------------
Business Units
-----------------------------------------------------------------------------------------------------------------------------------

                                                                            2000
                                                 Cinergy Business Units
<S>                        <C>          <C>         <C>           <C>            <C>         <C>         <C>           <C>
                                                       Cinergy                                 (1)       Reconciling
                           Commodities    Delivery   Investments  International     Total    All Other   Eliminations(2)Consolidated
                                                                        (in thousands)

Operating revenues -
  External customers       $  690,057   $  860,621  $  18,549     $  13,850      $1,583,077    $    -     $       -      $1,583,077
  Intersegment revenues       453,719            -          -             -         453,719         -      (453,719)              -
Segment profit (loss) (3)      80,064       58,495        (56)          (64)(4)     138,439         -             -         138,439

Total segment assets at
  March 31, 2000            5,165,144    4,044,712    138,409       351,654       9,699,919    52,821             -       9,752,740

</TABLE>


<TABLE>
<CAPTION>

                                                                            1999
                                                 Cinergy Business Units
<S>                        <C>          <C>         <C>           <C>            <C>         <C>         <C>            <C>

                                                       Cinergy                                           Reconciling
                           Commodities    Delivery   Investments  International     Total    All Other   Eliminations   Consolidated
                                                                        (in thousands)         (1)          (2)

Operating revenues -
  External customers       $   503,638  $  868,367  $  17,400     $  12,874      $1,402,279    $    -     $       -      $1,402,279
  Intersegment revenues        456,536           -          -             -         456,536         -      (456,536)              -
Segment Profit (Loss) (3)       50,494      62,526     (1,949)       15,695         126,766       479             -         127,245

Total segment assets at
  December 31, 1999          5,041,578   4,058,164    129,935       339,905       9,569,582    47,366             -       9,616,948




<FN>

(1)  The All Other category represents  miscellaneous corporate items, which are
     not allocated to business units for purposes of segment profit measurement.

(2)  The Reconciling  Eliminations category eliminates the intersegment revenues
     of Commodities.

(3)  Management   utilizes   segment   profit   (loss)   to   evaluate   segment
     profitability.

(4)  Reflects the loss of earnings  from the July 1999 sale of our 50% ownership
     interest in Avon Energy Partners  Holdings,  the parent company of Midlands
     Electricity plc, to GPU, Inc.
</FN>
</TABLE>

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




<PAGE>




6.   Earnings Per Common Share

A reconciliation of earnings per common share (EPS) to earnings per common share
assuming dilution (diluted EPS) is presented below:

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

                                            Income         Shares         EPS
                                        ----------------------------------------
                                        (in thousands, except per share amounts)


Quarter ended March 31, 2000
Earnings per common share:
   Net income                              $138,439        158,923       $0.87

Effect of dilutive securities:
  Common stock options                                           9
  Contingently issuable common stock                           343
                                        ----------------------------------------

EPS-assuming dilution:
  Net income plus assumed conversions      $138,439        159,275       $0.87

Quarter ended March 31, 1999
Earnings per common share:
  Net income                               $127,245        158,746       $0.80

Effect of dilutive securities:
  Common stock options                                         412
  Contingently issuable common stock                            26
                                        ----------------------------------------

EPS-assuming dilution:
  Net income plus assumed conversions      $127,245        159,184       $0.80

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

Options to purchase  shares of common stock are excluded from the calculation of
diluted EPS when the  exercise  prices of these  options  are  greater  than the
average  market price of the common shares  during the period.  For the quarters
ended March 31,  2000,  and 1999,  approximately  seven  million and two million
shares, respectively, were excluded from the diluted EPS calculation.

The Employee  Stock  Purchase and Savings Plan is also excluded from the diluted
EPS  calculation,  because the purchase price is greater than the average market
price during this period.  This plan allows all full-time,  regular employees to
purchase shares of common stock pursuant to a stock option  feature.  A detailed
description of this plan is available in the 1999 Form 10-K.


7.   Ohio Deregulation

As discussed in the 1999 Form 10-K, on July 6, 1999,  Ohio Governor  Robert Taft
signed  Amended  Substitute  Senate  Bill No. 3 (Electric  Restructuring  Bill),
beginning the transition to electric  deregulation  and customer  choice for the
state of Ohio. The Electric  Restructuring  Bill creates a competitive  electric
retail service market beginning January 1, 2001. The legislation  provides for a
market  development  period that begins  January 1, 2001, and ends no later than
December 31, 2005. Ohio electric utilities have an opportunity to recover Public
Utilities Commission of Ohio (PUCO)-approved  transition costs during the market
development  period.  The legislation  also freezes retail electric rates during
the market development period, at the rates in effect on October 4, 1999, except
for a five percent  reduction in the generation  component of residential  rates
and other potential adjustments.  Furthermore, the legislation contemplates that
twenty percent of the current electric retail customers will switch suppliers no
later than December 31, 2003.

The Electric  Restructuring Bill required each utility supplying retail electric
service in Ohio to file a comprehensive  proposed  transition plan with the PUCO
addressing  specific  requirements  of the  legislation.  CG&E filed its plan on
December  28, 1999.  The PUCO is required to issue a  transition  order no later
than October 31, 2000.  On March 27, 2000,  the PUCO staff issued a Staff Report
on  CG&E's  plan,  identifying  exceptions  and  offering   recommendations  for
Commission action.

On May 8, 2000,  CG&E  reached a  stipulated  agreement  with the PUCO staff and
various  other  interested  parties  with  respect to its  proposal to implement
electric  customer choice in Ohio beginning  January 1, 2001. The major features
of this agreement include:

*    Residential customer rates will be frozen through December 31, 2005;

*    Residential  customers  will  receive  a  five-percent   reduction  in  the
     generation portion of their electric rates, effective January 1, 2001;

*    CG&E has agreed to  provide $4 million  over the next five years in support
     of energy efficiency and weatherization services for low income customers;

*    The creation of a Regulatory Transition Charge, or RTC, designed to recover
     CG&E's regulatory assets and other transition costs over a ten-year period;

*    Authority  for  CG&E to  transfer  its  generation  assets  to a  separate,
     non-regulated  corporate  subsidiary to provide  flexibility  to manage its
     generation  asset  portfolio in a manner that enhances  opportunities  in a
     competitive marketplace;

*    Authority for CG&E to defer cost and apply the proceeds of transition  cost
     recovery  to  costs  incurred  during  the  transition   period   including
     implementation costs and purchased power costs that may be incurred by CG&E
     to continue to maintain a sufficient  reserve  margin  necessary to provide
     reliable and adequate services to its customers;

*    CG&E will provide standard offer default supplier service (i.e.,  CG&E will
     be the  supplier of last  resort,  so that no  customer  will be without an
     electric supplier); and

*    CG&E has agreed to provide shopping credits to switching customers.

CG&E expects to receive an order on the proposed  settlement prior to the end of
the third quarter of 2000.

CG&E expects to discontinue the application of Statement of Financial Accounting
Standards No. 71,  Accounting  for the Effects of Certain  Types of  Regulation,
with respect to its generating assets coincident with the regulatory approval of
the settlement.  To the extent the generating  assets are financially  impaired,
CG&E will be required to recognize a loss under  generally  accepted  accounting
principles.




<PAGE>





CAUTIONARY STATEMENTS


Cautionary Statements Regarding Forward-Looking Information

"Item 2. Management's Discussion and Analysis of Financial Condition and Results
of  Operations"  (MD&A)  discusses  various  matters that may make  management's
corporate vision of the future more clear for you. Certain of management's goals
and aspirations are outlined and specific  projections may be made.  These goals
and  projections  are  considered  forward-looking  statements  and are based on
management's beliefs and assumptions.

Forward-looking statements involve risks and uncertainties that may cause actual
results to be  materially  different  from the results  predicted.  Factors that
could cause actual results to differ are often  presented  with  forward-looking
statements.  In addition,  other  factors  could cause actual  results to differ
materially from those indicated in any forward-looking statement. These include:

*    Factors affecting operations, such as:

     (1)  unusual weather conditions;

     (2)  catastrophic weather-related damage;

     (3)  unscheduled generation outages;

     (4)  unusual maintenance or repairs;

     (5)  unanticipated  changes in fossil  fuel  costs,  gas supply  costs,  or
          availability constraints;

     (6)  environmental  incidents;  and

     (7)  electric transmission or gas pipeline system constraints.

*    Legislative  and  regulatory  initiatives  regarding  deregulation  of  the
     industry,  including Ohio's comprehensive  deregulation legislation and the
     outcome  of  The  Cincinnati  Gas  &  Electric  Company's  (CG&E)  Proposed
     Transition Plan.

*    The timing and extent of the entry of additional competition in electric or
     gas markets and the effects of continued industry consolidation through the
     pursuit of mergers, acquisitions, and strategic alliances.

*    Regulatory  factors such as changes in the policies or procedures  that set
     rates, changes in our ability to recover investments made under traditional
     regulation  through rates,  and changes to the frequency and timing of rate
     increases.

*    Financial  or  regulatory  accounting  principles  or  policies  imposed by
     governing bodies.

*    Political,  legal,  and economic  conditions and developments in the United
     States and the foreign  countries  in which we have a presence.  This would
     include inflation rates and monetary fluctuations.

*    Changing market conditions and other factors related to physical energy and
     financial trading  activities.  These would include price,  basis,  credit,
     liquidity,  volatility,  capacity,  transmission,  currency exchange rates,
     interest rates, and warranty risks.

*    The performance of projects undertaken by our non-regulated  businesses and
     the success of efforts to invest in and develop new opportunities.

*    Availability of, or cost of capital.

*    Employee workforce factors, including changes in key executives, collective
     bargaining agreements with union employees, and work stoppages.

*    Legal and regulatory  delays and other  obstacles  associated with mergers,
     acquisitions, and investments in joint ventures.

*    Costs and  effects of legal and  administrative  proceedings,  settlements,
     investigations,  and claims.  Examples can be found in Note 4 of the "Notes
     to Financial  Statements" in "Part 1. Financial  Information"  beginning on
     page 26.

*    Changes   in   international,   federal,   state,   or  local   legislative
     requirements,  such as changes in tax laws,  tax rates,  and  environmental
     laws and regulations.

Unless  we  otherwise  have  a  duty  to do  so,  the  Securities  and  Exchange
Commission's (SEC) rules do not require forward-looking statements to be revised
or  updated  (whether  as a result of  changes  in actual  results,  changes  in
assumptions,  or other factors  affecting the statements).  Our  forward-looking
statements  reflect our best beliefs as of the time they are made and may not be
updated for subsequent developments.


<PAGE>



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

INTRODUCTION

In MD&A, we explain  liquidity,  capital  resources,  and results of operations.
Specifically, we discuss the following:

* factors affecting current and future  operations;
* why revenues and expenses changed  from  period to period;  and
* how the above  items  affect our overall financial condition.

LIQUIDITY

In the "Liquidity"  section, we discuss  environmental  issues as they relate to
our current and future cash needs. In the "Capital  Resources" section beginning
on page 38, we discuss how we intend to meet these capital requirements.

Environmental Issues

In the "Environmental  Issues" section, we discuss ozone transport  rulemakings,
new source review, and manufactured gas plant sites as they relate to us and our
operating companies.

Ozone Transport Rulemakings, New Source Review,
Manufactured Gas Plant Sites, and Other

See Notes 4(a),  (b),  (c),  and (d),  respectively,  of the "Notes to Financial
Statements" in "Part I. Financial Information" on pages 26 through 30.


<PAGE>




CAPITAL RESOURCES

Debt

Cinergy Corp.  has current  authorization  from the SEC under the Public Utility
Holding  Company Act of 1935, as amended  (PUHCA),  to issue and sell short-term
notes and commercial  paper and long-term  unsecured  debt through  December 31,
2002,  provided the total principal  amount of all these debt securities may not
exceed $2 billion at any time.  In  addition,  Cinergy  Corp.'s  long-term  debt
cannot exceed $400 million at any time. As of March 31, 2000,  Cinergy Corp. has
$400 million of long-term debt  outstanding,  and  therefore,  under the current
authorization,  it cannot issue any additional long-term debt. Cinergy Corp. has
a request for additional authority pending with the SEC.

SHORT-TERM DEBT In connection with the current SEC authorization,  Cinergy Corp.
has established  lines of credit.  As of March 31, 2000,  Cinergy Corp. had $468
million remaining unused and available on its established lines.

Our operating  companies  have  regulatory  authority to borrow up to a total of
$853  million in  short-term  debt ($453  million for CG&E and its  subsidiaries
including $50 million for The Union Light,  Heat and Power Company (ULH&P),  and
$400 million for PSI Energy,  Inc.  (PSI)).  In connection  with this authority,
CG&E and PSI have  established  lines of credit,  of which, $87 million and $129
million, respectively, remained unused and available at March 31, 2000.

As of March  31,  2000,  our  non-regulated  subsidiaries  have $82  million  in
short-term debt and established  lines of credit of which $.6 million was unused
and available.  Our  non-regulated  subsidiaries  have the availability of funds
from Cinergy Corp. if the need arises.

A portion of each  company's  committed  lines is used to provide credit support
for  commercial  paper  (discussed  below)  and other  uncommitted  lines.  When
committed lines are reserved for commercial  paper or other  uncommitted  lines,
they are not available for additional borrowings.

COMMERCIAL  PAPER The  commercial  paper  (debt  instruments  exchanged  between
companies) program is limited to a maximum outstanding  principal amount of $400
million for Cinergy  Corp. As of March 31, 2000,  Cinergy Corp.  had issued $156
million in commercial paper.

CG&E and PSI also have the  capacity to issue  commercial  paper,  which must be
supported by available  committed lines of the respective  company.  The maximum
outstanding  principal  amount  for  CG&E  is $200  million  and for PSI is $100
million.  At March 31,  2000,  neither  CG&E nor PSI had issued  any  commercial
paper.

Variable Rate  Pollution  Control  Notes CG&E and PSI have issued  variable rate
pollution  control notes (tax-exempt notes obtained to finance equipment or land
development for pollution control purposes).  Because the holders of these notes
have the right to redeem their notes on any business  day, they are reflected in
Notes payable and other  short-term  obligations  in the  Consolidated  Balance
Sheets for Cinergy  (Cinergy  Corp.  and all of its regulated and  non-regulated
subsidiaries)  on page 6, for CG&E on page 12,  and for PSI on page 17. At March
31,  2000,  CG&E  and PSI  had  $184  million  and  $83  million,  respectively,
outstanding in pollution control notes.

Money Pool Our operating companies and their subsidiaries participate in a money
pool arrangement to better manage cash and working capital  requirements.  Under
this arrangement,  our operating  companies and their  subsidiaries with surplus
short-term funds provide  short-term loans to each other.  This surplus cash may
be from internal or external sources.  The amounts  outstanding under this money
pool  arrangement are shown as Notes  receivable  from  affiliated  companies or
Notes payable to affiliated  companies on the  Consolidated  Balance  Sheets for
CG&E on pages 11 through 12, PSI on pages 16 through 17, and the Balance  Sheets
for ULH&P on pages 21 through 22.

Long-Term Debt Under the PUHCA authorization  mentioned previously,  we are able
to issue and sell long-term debt at the parent  holding  company level.  Cinergy
Corp.'s  long-term  debt cannot exceed $400 million at any time. As of March 31,
2000,  Cinergy  Corp.  has $400  million  of  long-term  debt  outstanding,  and
therefore,  under the  current  authorization,  it cannot  issue any  additional
long-term  debt.  Cinergy Corp. has a request for additional  authority  pending
with the SEC.

Currently,  our  operating  companies  have the following  types of  outstanding
long-term  debt:  First Mortgage  Bonds and other Secured Notes,  and Senior and
Junior  Unsecured Debt.  Under our existing  authority,  the remaining  unissued
debt, as of April 30, 2000, is reflected in the following table:


              Authorizing Agency             CG&E           PSI           ULH&P

                                                     (in millions)


Applicable State Utility Commission          $200          $400            $30
(Secured or Unsecured Debt)




We may, at any time, request additional long-term debt authorization to increase
our authority.  This request is subject to regulatory approval, which may or may
not be granted.

As of March 31, 2000, through shelf  registrations  filed with the SEC under the
Securities Act of 1933, we could issue the following amounts of debt securities:



                                                   CG&E        PSI        ULH&P

                                                           (in millions)

First Mortgage Bonds and Other Secured Notes       $300         $265       $20
Senior or Junior Unsecured Debt                      50          400        30



For information  regarding recent redemptions of long-term debt securities,  see
Note 3 of the "Notes to Financial Statements" in "Part I. Financial Information"
on page 26.




<PAGE>




Guarantees

We are subject to a SEC order under the PUHCA,  which limits the amounts Cinergy
Corp. can have outstanding under guarantees (promises to pay by one party in the
event of default by another  party) at any one time to $1  billion.  As of March
31, 2000, we had $576 million  outstanding under the guarantees issued.  Cinergy
Corp. has a request for additional  authority to issue  guarantees  pending with
the SEC.




<PAGE>




2000 RESULTS OF OPERATIONS

SUMMARY OF RESULTS

Electric  and gas  margins  and net income for  Cinergy,  CG&E,  and PSI for the
quarters ended March 31, 2000, and 1999, were as follows:

                          Cinergy (1)           CG&E                PSI
                        2000      1999      2000     1999      2000     1999
                                           (in thousands)

Electric gross margin $565,919  $535,363 $297,666  $282,715  $262,323  $247,538
Gas gross margin        92,583    86,906   88,846    84,919         -         -
Net income             138,439   127,245   95,964    80,237    50,213    39,841

  (1)  The results of Cinergy also include amounts related to non-registrants.


Our diluted  earnings per share for the first quarter of 2000  increased to $.87
per share from $.80 per share for the same period of 1999.

Earnings of our regulated operations,  including the supply business,  increased
$.21 per share in the first quarter of 2000,  when  compared to 1999.  Partially
offsetting this increase was a decrease of $.15 per share in the contribution to
earnings of our non-regulated  investment  activities.  This decrease  primarily
reflects  the loss of  earnings  from the July  1999  sale of our 50%  ownership
interest in Avon Energy Partners  Holdings (Avon Energy),  the parent company of
Midlands Electricity plc, to GPU, Inc. (GPU).

The  explanations  below follow the line items on the  Statements  of Income for
Cinergy, CG&E, and PSI, which begin on page 4. However, only the line items that
varied significantly from prior periods are discussed.

ELECTRIC OPERATING REVENUES




                Cinergy (1)              CG&E                    PSI
            2000  1999  % Change  2000  1999  % Change    2000  1999 % Change
                                  (in millions)

Retail      $650   $676    (4)    $351  $358     (2)      $298  $318    (6)
Wholesale    384    266    44      182   121     50        227   157    45
Other         33     27    22        5     3     67          9     7    29
          ------   ----           ----  ----              ----  ----
  Total   $1,067   $969    10     $538  $482     12       $534  $482    11


   (1)   The results of Cinergy also include amounts related to non-registrants.



Electric operating revenues for Cinergy, CG&E, and PSI increased for the quarter
ended March 31, 2000, as compared to 1999,  mainly due to an increase in volumes
on  non-firm  wholesale  transactions  related to energy  marketing  and trading
activity.  Non-firm power is power without a guaranteed  commitment for physical
delivery. Partially offsetting this increase was a decrease in the average price
per kilowatt-hour (kWh) realized for wholesale power transactions and lower firm
wholesale kWh sales.

Despite an increase in  customers,  retail  revenues  declined  during the first
quarter of 2000, as compared to last year.  Retail revenues for Cinergy and CG&E
decreased  as a result of an overall  decrease  in volumes  and a lower  average
realization  per kWh. This decrease in volumes was mainly due to the warmer than
normal  weather  experienced  during  the first  quarter of 2000.  PSI's  retail
revenues decreased mainly as a result of a lower average realization per kWh.

GAS OPERATING REVENUES


                          Cinergy (1)                        CG&E
                 2000      1999     % Change       2000      1999     % Change
                                      (in millions)

Non-regulated    $321      $257         25         $  -      $  -          -
Retail            154       142          8          154       142          8
Transportation     22        20         10           22        20         10
Other               2         2          -            2         2          -
                 ----     -----                    ----      ----
   Total         $499      $421         19         $178      $164          9


  (1)  The results of Cinergy also include amounts related to non-registrants.



Gas operating  revenues for Cinergy increased in the first quarter of 2000, when
compared to the same period last year.  This increase is primarily the result of
a higher price received per thousand cubic feet (mcf) sold by Cinergy  Marketing
and Trading, LLC.

CG&E's retail  revenues  increased  primarily due to a higher price received per
mcf sold. This increase was partially  offset by a decline in mcf sales due to a
reduction  in   residential   customers   and  a  warmer  than  normal   winter.
Transportation   revenues   increased  due  to  the  continued   progression  of
full-service   customers   (customers   who   purchase   gas  and   utilize  the
transportation  services of CG&E)  purchasing  gas directly  from  suppliers and
using transportation services provided by CG&E.

OTHER REVENUES

Other  operating  revenues for Cinergy  increased $5 million  (42%) in the first
quarter of 2000,  when  compared  to the same period in 1999,  primarily  due to
revenues from the marketing of energy-related services.




<PAGE>




OPERATING EXPENSES


                       CINERGY (1)           CG&E                 PSI

                    2000 1999  % Change  2000 1999 % Change  2000 1999  % Change
                                        (in millions)

Fuel             $  186 $  198    (6)   $ 82 $ 86     (5)    $ 99 $107      (7)
Purchased and
  exchanged power   315    235    34     158  113     40      172  128      34
Gas purchased       406    334    22      90   79     14        -    -       -
Operation           194    195    (1)     80   84     (5)      85   88      (3)
Maintenance          51     50     2      25   24      4       26   25       4
Depreciation and
  amortization       90     86     5      51   51      -       35   34       3
Taxes other than
  income taxes       66     70    (6)     50   54     (7)      15   14       7
                 ------ ------          ---- ----            ---- ----
  Total          $1,308 $1,168    12    $536 $491      9     $432 $396       9


(1)   The results of Cinergy also include amounts related to non-registrants.


Fuel

Fuel represents the cost of coal,  natural gas, and oil that is used to generate
electricity.  The  following  table details the changes to fuel expense from the
quarter ended March 31, 1999, to the quarter ended March 31, 2000:




                                       Cinergy (1)   CG&E      PSI
                                                (in millions)

Fuel expense - March 31, 1999            $198        $86      $107

Increase (decrease) due to changes in:

Price of fuel                              (2)       (2)         -
Deferred fuel cost                        (21)       (3)       (18)
KWh generation                             11         1         10
                                         ----      ----       ----
Fuel expense - March 31, 2000            $186       $82        $99



   (1) The results of Cinergy also include amounts related to non-registrants.




Purchased and exchanged power

Purchased and exchanged power  represents the  electricity  that is bought to be
sold through our energy marketing and trading activities. This expense increased
for Cinergy,  CG&E, and PSI for the first quarter of 2000 compared to last year.
This  increase  was  primarily  due to an  increase  in  purchases  of  non-firm
wholesale  power as a  result  of an  increase  in sales  volume  in the  energy
marketing and trading operations.

Gas purchased

Gas  purchased  expense  increased for Cinergy and CG&E for the first quarter of
2000,  when compared to the same period last year,  primarily due to an increase
in the average cost per mcf of gas purchased.




<PAGE>




Depreciation and amortization

Cinergy's  and PSI'S  Depreciation  and  amortization  costs  increased  for the
quarter  ended  March 31,  2000,  as  compared  to the same  period  last  year,
primarily  due to  additions  to  depreciable  plant.

EQUITY IN  EARNINGS  OF UNCONSOLIDATED SUBSIDIARIES

Cinergy's  Equity in  earnings  of  unconsolidated  subsidiaries  decreased  $43
million  (96%) for the first  quarter of 2000,  when compared to the same period
last year. This decrease is primarily due to the loss in earnings resulting from
the sale of our 50% ownership interest in Avon Energy to GPU on July 15, 1999.

INTEREST

Cinergy's  Interest expense  decreased $9 million (15%) for the first quarter of
2000, when compared to the same period last year. This decrease is primarily due
to a reduction in short-term  borrowings as a result of the sale of Avon Energy.
This decrease was slightly offset by an increase in average short-term  interest
rates.




<PAGE>




ULH&P

The format of the following  Results of Operations  discussion  has been changed
from the  format  of  prior  reports.  Unlike  prior  reports,  the  Results  of
Operations  discussion  for ULH&P is presented  only for the quarter ended March
31, 2000, in accordance with General Instruction H(2)(a).

Electric and gas margins and net income for ULH&P for the quarters ended March
31, 2000, and 1999, were as follows:

                                                ULH&P
                                          2000          1999
                                            (in thousands)

   Electric gross margin                $14,077       $12,411
   Gas gross margin                      15,493        15,678
   Net income                             8,146         6,543





Retail  Electric  operating  revenues  for the  quarter  ended  March 31,  2000,
compared to last year,  decreased mainly due to a lower average  realization per
kWh. This decrease was offset by an increase in electric  property rental income
related to an  intercompany  transaction  beginning  in April 1999.  Electricity
purchased  from parent  company for resale also decreased due to a lower average
realization per kWh.

The increase in Gas  operating  revenues  for the quarter  ended March 31, 2000,
compared to last year,  was mainly due to a higher  price  received per mcf sold
and an increase  in the number of  residential  and  commercial  customers.  Gas
purchased  expense  increased  due to an increase in the average cost per mcf of
gas purchased.

The decrease in Operation and maintenance costs for the quarter ended
March 31, 2000, as compared to the same period last year, was primarily due to a
decrease in administrative and general expenses.




<PAGE>


FUTURE EXPECTATIONS/TRENDS

In the  "Future  Expectations/Trends"  section,  we  discuss  electric  industry
developments,  market  risk  sensitive  instruments  and  positions,  impact  of
acquisitions,  accounting changes, and the corporate center restructuring.  Each
of these discussions will address the current status and potential future impact
on our results of operations and financial condition.

ELECTRIC INDUSTRY

Wholesale Market Developments

Supply-side  Actions As discussed in the 1999 Form 10-K,  on September 30, 1999,
one of our non-regulated  subsidiaries formed a partnership (each party having a
50% ownership)  with Duke Energy North America LLC, in an effort to increase the
available  generating  capacity  for  use  during  peak  demand  periods.   This
partnership  is  to  jointly  construct  and  own  three  wholesale   generating
facilities.  On March 9, 2000, the Indiana Utility Regulatory  Commission (IURC)
issued  an order  (Cause  No.  41569),  requiring  us to  immediately  cease all
construction  activities at the site located near Cadiz,  (Henry County) Indiana
(a planned 132 megawatts (MW) capacity  peaking plant).  In making this decision
the IURC  found that it needs  additional  information  related  to the  project
before  issuing  a final  decision.  The IURC has  requested  the  Henry  County
Planning  Commission and/or the Henry County  Commissioners to supply additional
information by June 1, 2000. At this time,  Cinergy cannot currently predict the
outcome of any potential  decision.  Construction  of the  remaining  facilities
(with total capacity of approximately  1,268 MW) continues with the anticipation
of being fully  operational  by the summer of 2000.  We are  supplementing  this
additional  capability  with block power  purchases  for the summer of 2000 peak
period.

Retail Market Developments

Ohio As discussed in the 1999 Form 10-K,  during 1999, Ohio Governor Robert Taft
signed into law a bill creating a competitive  electric  retail  service  market
beginning  January 1, 2001. As required by the bill,  CG&E filed its  transition
plan on December 28, 1999.

On May 8, 2000,  CG&E  reached a  stipulated  agreement  with the PUCO staff and
various  other  interested  parties  with  respect to its  proposal to implement
electric  customer choice in Ohio beginning  January 1, 2001. The major features
of this agreement include:

*    Residential customer rates will be frozen through December 31, 2005;

*    Residential  customers  will  receive  a  five-percent   reduction  in  the
     generation portion of their electric rates, effective January 1, 2001;

*    CG&E has agreed to  provide $4 million  over the next five years in support
     of energy efficiency and weatherization services for low income customers;

*    The creation of a Regulatory Transition Charge, or RTC, designed to recover
     CG&E's regulatory assets and other transition costs over a ten-year period;

*    Authority  for  CG&E to  transfer  its  generation  assets  to a  separate,
     non-regulated  corporate  subsidiary to provide  flexibility  to manage its
     generation  asset  portfolio in a manner that enhances  opportunities  in a
     competitive marketplace;

*    Authority  for CG&E to apply the proceeds of  transition  cost  recovery to
     costs incurred during the transition period including  implementation costs
     and  purchased  power  costs that may be  incurred  by CG&E to  continue to
     maintain a sufficient  reserve  margin  necessary  to provide  reliable and
     adequate services to its customers; and

*    CG&E will provide standard offer default supplier service (i.e.,  CG&E will
     be the  supplier of last  resort,  so that no  customer  will be without an
     electric supplier); and

*    CG&E has agreed to provide shopping credits to switching customers.

CG&E expects the settlement to be approved prior to the end of the third quarter
of 2000.

For additional information, see Note 7 of the "Notes to Financial Statements" in
"Part I. Financial Information" on page 33.

Midwest ISO

As part of the effort to create a competitive  wholesale power marketplace,  the
Federal  Energy  Regulatory  Commission  (FERC)  approved  the  formation of the
Midwest  Independent  Transmission  Systems Operator,  Inc. (Midwest ISO) during
1998.  The Midwest ISO will  oversee the  combined  transmission  systems of its
members.  The  organization  is expected to begin  operations in late 2001. This
effort will help to  facilitate  a reliable  and  efficient  market for electric
power and create open  transmission  access  consistent with FERC policies.  The
Midwest ISO currently includes 13 members with over 52,000 miles of transmission
lines in 11 states and an  aggregate  investment  of  approximately  $8 billion.
Discussions   are   currently   underway  to  merge  the  Midwest  ISO  and  the
Mid-Continent  Area Power Pool (MAPP).  The MAPP Board of Directors and the MAPP
Members have approved the consolidation of assets between the two organizations.
The final  requirement  for the merger is two-thirds of the MAPP load voting for
the Midwest ISO becoming the operator of their transmission systems.

Significant Rate Developments

Purchased  Power  Tracker On May 28,  1999,  PSI filed a petition  with the IURC
seeking approval of a purchased power tracking mechanism (tracker). This request
is designed to provide for the  recovery of costs  related to purchases of power
necessary  to meet  native  load  requirements  to the extent such costs are not
sought through the existing fuel adjustment  clause.  The tracker is intended to
apply to a limited number of purchases made for the purpose of ensuring adequate
power  reserves to meet peak retail  native load  requirements,  which in recent
years have  coincided with periods of extreme price  volatility.  As proposed by
PSI, the tracker would only apply to capacity  purchases  which are presented to
the IURC for review and approval as to reasonableness under the circumstances.


A hearing on this  request  was  completed  on  December  9,  1999.  An order is
expected during the second quarter of 2000.

MARKET RISK SENSITIVE INSTRUMENTS AND POSITIONS

Energy Commodities Sensitivity

We market and trade electricity, natural gas, and other energy-related products.
We use  over-the-counter  forward and option contracts for the purchase and sale
of electricity and also trade exchange-traded futures contracts.  See Notes 1(b)
and  1(c)  of  the  "Notes  to  Financial  Statements"  in  "Part  I.  Financial
Information"  on pages 24 through 25, for our  accounting  policies  for certain
derivative instruments.  For additional  information,  see "Item 7. Management's
Discussion and Analysis of Financial  Condition and Results of Operations" pages
61  through  64,  of our 1999 Form  10-K.  Our  market  risks  have not  changed
materially from the market risks reported in the 1999 Form 10-K.

Exchange Rate Sensitivity

From  time to time,  we may  utilize  foreign  exchange  forward  contracts  and
currency swaps to hedge certain of our net  investments  in foreign  operations.
See Notes  1(b) and 1(c) of the  "Notes  to  Financial  Statements"  in "Part I.
Financial  Information" on pages 24 through 25, for our accounting  policies for
certain derivative instruments.

Interest Rate Sensitivity

Our net  exposure  to  changes  in  interest  rates  primarily  consist  of debt
instruments with floating  interest rates that are benchmarked to various market
indices.  To manage the exposure to  fluctuations in interest rates and to lower
funding  costs,  we evaluate the use of, and have entered  into,  interest  rate
swaps.  See Notes 1(b) and 1(c) of the "Notes to Financial  Statements" in "Part
I. Financial  Information"  on pages 24 through 25, for our accounting  policies
for certain derivative instruments. Our market risks have not changed materially
from the market risks reported in the 1999 Form 10-K.

ACCOUNTING CHANGES

During the second  quarter of 1998,  the Financial  Accounting  Standards  Board
(FASB) issued Statement of Financial  Accounting  Standards No. 133,  Accounting
for Derivative Instruments and Hedging Activities (Statement 133). This standard
requires  companies to record  derivative  instruments as assets or liabilities,
measured  at  fair  value.  Changes  in the  derivative's  fair  value  must  be
recognized  currently in earnings unless specific hedge accounting  criteria are
met. Hedges are transactions  entered into for the purpose of reducing  exposure
to one or more types of  business  risk.  Gains and losses on  derivatives  that
qualify as hedges can offset  related  results on the hedged  item in the income
statement.

This  standard,  as  subsequently  amended by Statement of Financial  Accounting
Standards  No.  137,   Accounting   for  Derivative   Instruments   and  Hedging
Activities-Deferral  of the Effective Date of FASB Statement  No.133  (Statement
137), is effective for fiscal years  beginning  after June 15, 2000. The purpose
of Statement 137 was to delay the  effective  date of Statement 133 by one year.
We expect to reflect the  adoption  of this  standard  in  financial  statements
issued  beginning in the first quarter of 2001. In recognition of the complexity
of this new standard,  the Derivatives  Implementation  Group has been formed by
the FASB. In preparation for our  implementation  of this new standard,  we have
formed a  cross-functional  project team.  The project team is  identifying  and
analyzing all contracts  which could be subject to the new standard,  developing
required  documentation,  defining  relevant  processes and information  systems
needs,  and  promoting  internal  awareness of the  requirements  and  potential
effects  of the new  standard.  While we  continue  to  analyze  and  follow the
development of implementation  guidelines, at this time we are unable to predict
whether the  implementation of this accounting  standard will be material to our
results of operations and financial position. However, the adoption of Statement
133 could increase volatility in earnings and other comprehensive income.

CORPORATE CENTER RESTRUCTURING

On March 10, 2000, we announced a plan to reorganize  our corporate  center that
will eliminate approximately 240 jobs. A limited early retirement program (LERP)
and unfilled vacancies are expected to reduce the number of employees  displaced
to   approximately   45.  These  employees  will  be  able  to  seek  other  job
opportunities  within Cinergy or voluntarily  elect to accept a severance  plan.
Overall, this reorganization is expected to achieve approximately $25 million in
annual savings for Cinergy.


<PAGE>





                ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES
                                ABOUT MARKET RISK

Reference  is made to the "Market  Risk  Sensitive  Instruments  and  Positions"
section in "Item 2. Management's  Discussion and Analysis of Financial Condition
and Results of Operations" in "Part I.  Financial  Information"  on page 48, and
Notes 1(b) and 1(c) of the "Notes to Financial Statements" in "Part I. Financial
Information" on pages 24 through 25.




<PAGE>





                           PART II. OTHER INFORMATION

                            ITEM 1. LEGAL PROCEEDINGS


NEW SOURCE REVIEW, MANUFACTURED GAS PLANT SITES, AND OTHER

See  Notes  4(b),  (c),  and  (d),  respectively,  of the  "Notes  to  Financial
Statements" in "Part I. Financial Information" on pages 28 through 30.

           ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

The annual meeting of  shareholders of Cinergy Corp. was held April 27, 2000, in
Cincinnati, Ohio.

At the meeting,  one Class I director was elected to the board of Cinergy  Corp.
to serve for a one-year term ending in 2001,  and four Class III directors  were
elected to the board of Cinergy Corp. to serve  three-year terms ending in 2003,
as set forth below:


           Class I                 Votes For          Votes Withheld

     Michael G. Browning          125,416,635            2,912,311


        Class III                  Votes For          Votes Withheld

     Phillip R. Cox               125,499,093            2,829,853
     James E. Rogers              124,687,045            3,641,901
     John J. Schiff, Jr.          124,907,634            3,421,312
     Oliver W. Waddell            125,368,524            2,960,422



In lieu of the annual meeting of  shareholders  of The Cincinnati Gas & Electric
Company (CG&E),  a resolution was duly adopted via unanimous  written consent of
Cinergy Corp.,  CG&E's sole shareholder,  effective April 26, 2000, electing the
following members of the Board of Directors for one-year terms expiring in 2001:

*    Jackson H. Randolph
*    James E. Rogers
*    James L. Turner

The annual meeting of shareholders of PSI Energy,  Inc. was held April 27, 2000,
in Cincinnati, Ohio.

Proxies  were not  solicited  for the  annual  meeting,  at which  the  Board of
Directors was re-elected in its entirety (see below).

By  unanimous  vote,  the  following  members  of the  Board of  Directors  were
re-elected at the annual meeting for one-year terms expiring in 2001:

*        James K. Baker
*        Michael G. Browning
*        John A. Hillenbrand II
*        Jackson H. Randolph
*        James E. Rogers












<PAGE>





                    ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K

(a) Exhibits  identified  with a pound sign (#) are being filed  herewith by the
registrant  identified  in the  exhibit  discussion  below and are  incorporated
herein by reference with respect to any other  designated  registrant.  Exhibits
not so identified are filed herewith:




     Exhibit
   Designation         Registrant                   Nature of Exhibit

Articles of Incorporation/By-Laws

       3a           Cinergy       By-Laws of Cinergy as amended April 27, 2000.
Financial Data Schedule
       27           Cinergy       Financial Data Schedules (included in
                    CG&E          electronic submission only)
                    PSI
                    ULH&P

(b) The following  reports on Form 8-K were filed during the quarter or prior to
the filing of the Form 10-Q for the quarter ended March 31, 2000.


 Date of Report       Registrant          Item Filed


 May 10, 2000           Cinergy        Item 5. Other Events
                        CG&E           Item 7. Financial Statements and Exhibits






<PAGE>






                                   SIGNATURES

Certain  information  and footnote  disclosures  normally  included in financial
statements prepared in accordance with generally accepted accounting  principles
have been condensed or omitted pursuant to such rules and regulations,  although
Cinergy Corp., The Cincinnati Gas & Electric  Company,  PSI Energy Inc., and The
Union Light, Heat and Power Company believe that the disclosures are adequate to
make the information presented not misleading.  In the opinion of Cinergy, CG&E,
PSI, and ULH&P,  these statements reflect all adjustments (which include normal,
recurring  adjustments)  necessary to reflect the results of operations  for the
respective periods.  The unaudited statements are subject to such adjustments as
the annual audit by independent public accountants may disclose to be necessary.

Pursuant to the  requirements of Section 13 or 15(d) of the Securities  Exchange
Act of 1934,  the  Registrants  have duly  caused this report to be signed by an
officer  and the chief  accounting  officer on their  behalf by the  undersigned
thereunto duly authorized.

                                                   CINERGY CORP.
                                         THE CINCINNATI GAS & ELECTRIC COMPANY
                                                  PSI ENERGY, INC.
                                        THE UNION LIGHT, HEAT AND POWER COMPANY

                                                    Registrants

DATE:  MAY 12, 2000                   /S/        BERNARD F. ROBERTS

                                                 Bernard F. Roberts
                                              Duly Authorized Officer
                                                       and
                                             Chief Accounting Officer