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 September 30, 1996 

                                   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.

  1-9130        CENTERIOR ENERGY CORPORATION                34-1479083
                (An Ohio Corporation)
                6200 Oak Tree Boulevard
                Independence, Ohio  44131
                Telephone (216) 447-3100

  1-2323        THE CLEVELAND ELECTRIC                      34-0150020
                  ILLUMINATING COMPANY
                (An Ohio Corporation)
                c/o Centerior Energy Corporation
                6200 Oak Tree Boulevard
                Independence, Ohio   44131
                Telephone (216) 622-9800

  1-3583        THE TOLEDO EDISON COMPANY                   34-4375005
                (An Ohio Corporation)
                300 Madison Avenue
                Toledo, Ohio  43652
                Telephone (419) 249-5000


     Indicate by check mark whether each of the registrants (1) has filed 
all reports required to be filed by  Section 13 or 15(d) of  the  
Securities  Exchange Act of 1934 during the preceding 12 months (or for 
such shorter period that the registrants were required to file such 
reports), and  (2) has  been  subject  to  such  filing  requirements for  
the  past  90  days.

Yes   X       No               


     On November 13, 1996, there were 148,025,928 shares of Centerior 
Energy Corporation Common Stock outstanding.  Centerior Energy Corporation 
is the sole holder of the 79,590,689 shares and 39,133,887 shares of common 
stock of The Cleveland Electric Illuminating Company and The Toledo Edison 
Company, respectively, outstanding on that date.






This combined Form 10-Q is separately filed by Centerior Energy Corporation 
("Centerior Energy"), The Cleveland Electric Illuminating Company 
("Cleveland Electric") and The Toledo Edison Company ("Toledo Edison").  
Centerior Energy, Cleveland Electric and Toledo Edison are sometimes 
referred to collectively as the "Companies".  Cleveland Electric and Toledo 
Edison are sometimes collectively referred to as the "Operating Companies". 
Information contained herein relating to any individual registrant is filed 
by such registrant on its behalf.  No registrant makes any representation 
as to information relating to any other registrant, except that information 
relating to either or both of the Operating Companies is also attributed to 
Centerior Energy.

Centerior Energy has made forward-looking statements in Note 8 to the 
financial statements in this Form 10-Q regarding the merger with Ohio 
Edison Company ("Ohio Edison") herein referred to and the associated 
Regulatory Plan (as defined herein), which statements are subject to risks 
and uncertainties, including the impact on the Companies if:  (1) 
competitive pressure in the electric utility industry increases 
significantly;(2) state and federal regulatory initiatives are implemented 
that increase competition, threaten costs and investment recovery and 
impact rate structures; (3) the provisions of the Regulatory Plan vary 
significantly from what has been announced; (4) the effects of the 
Regulatory Plan or other events on the carrying value of regulatory assets 
and on the Operating Companies' ability to continue to apply SFAS 71 (as 
defined herein) cause an impairment of property, plant and equipment or 
variances from the amounts disclosed; (5) expected cost savings from the 
merger cannot be fully realized; (6) costs or difficulties related to the 
integration of the business of Ohio Edison and Centerior Energy are greater 
than expected; (7) unanticipated developments occur which change the 
Operating Companies' expectations regarding cost recovery over the 
Regulatory Plan period; or (8) general economic conditions, either 
nationally or in the area in which the combined company will be doing 
business are less favorable than expected.
















                                     -i-





                               TABLE OF CONTENTS
                                                                           

                                                                       Page
PART I.  FINANCIAL INFORMATION

          Centerior Energy Corporation and Subsidiaries
          The Cleveland Electric Illuminating Company and Subsidiary
          The Toledo Edison Company

         Notes to the Financial Statements  (Unaudited)                   1

        Centerior Energy Corporation and Subsidiaries

             Income Statement                                             5
             Balance Sheet                                                6 
             Cash Flows                                                   7
             Management's Discussion and Analysis of Financial            8
               Condition and Results of Operations

        The Cleveland Electric Illuminating Company and Subsidiary

             Income Statement                                            12
             Balance Sheet                                               13
             Cash Flows                                                  14
             Management's Discussion and Analysis of Financial           15
               Condition and Results of Operations

        The Toledo Edison Company

             Income Statement                                            19
             Balance Sheet                                               20
             Cash Flows                                                  21
             Management's Discussion and Analysis of Financial           22
               Condition and Results of Operations

PART II.  OTHER INFORMATION

          Item 5.  Other Information                                     26
          Item 6.  Exhibits and Reports on Form 8-K                      27


Signatures                                                               28 

Exhibit Index                                                            29



                        






                                     -ii-




                  CENTERIOR ENERGY CORPORATION AND SUBSIDIARIES, 
                 THE CLEVELAND ELECTRIC ILLUMINATING COMPANY AND 
                    SUBSIDIARY, AND THE TOLEDO EDISON COMPANY
                  NOTES TO THE FINANCIAL STATEMENTS (UNAUDITED)

(1)  Interim Financial Statements

Centerior Energy Corporation (Centerior Energy) is the parent 
company of Centerior Service Company (Service Company); two 
electric utilities, The Cleveland Electric Illuminating Company 
(Cleveland Electric) and The Toledo Edison Company (Toledo 
Edison); and three other wholly owned subsidiaries.  The two 
utilities are referred to collectively herein as the "Operating 
Companies" and individually as an "Operating Company".  Centerior 
Energy, Cleveland Electric and Toledo Edison are referred to 
collectively herein as the "Companies".  

The comparative income statement and balance sheet and the related 
statement of cash flows of each of the Companies have been 
prepared from the records of each of the Companies without audit 
by independent public accountants.  In the opinion of management, 
all adjustments necessary for a fair presentation of financial 
position at September 30, 1996 and results of operations and cash 
flows for the three months and nine months ended September 30, 
1996 and 1995 have been included.  All such adjustments were 
normal recurring adjustments, except for the write-down of 
inactive production facilities in the first quarter of 1996 
discussed in Note 7.  

These financial statements and notes should be read in conjunction 
with the financial statements and notes included in the Companies' 
combined Annual Report on Form 10-K for the year ended December 
31, 1995 (1995 Form 10-K) and the Quarterly Reports on Form 10-Q 
for the quarter ended March 31, 1996 (First Quarter 1996 Form 10-
Q) and the quarter ended June 30, 1996 (Second Quarter 1996 Form 
10-Q).  These interim period financial results are not necessarily 
indicative of results for a 12-month period.  

In August 1995, Cleveland Electric formed a wholly owned 
subsidiary, Centerior Funding Corporation (Centerior Funding), to 
serve as the transferor in connection with asset-backed 
securitization transactions completed by the Operating Companies 
in May and July 1996 as discussed in Note 5 to the financial 
statements in the Second Quarter 1996 Form 10-Q.

(2)  Equity Distribution Restrictions

The Operating Companies can make cash available for the funding of 
Centerior Energy's common stock dividends by paying dividends on 
their respective common stock, which is held solely by Centerior 
Energy.  Federal law prohibits the Operating Companies from paying 
dividends out of capital accounts.  However, the Operating 
Companies may pay preferred and common stock dividends out of 
appropriated retained earnings and current earnings.  At September 
30, 1996, Cleveland Electric and Toledo Edison had $187.6 million 
and $208.9 million, respectively, of appropriated retained 
earnings for the payment of dividends.  However, Toledo Edison is 
prohibited from paying a common stock dividend by a provision in 
its mortgage that essentially requires such dividends to be paid 
out of the total balance of retained earnings, which currently is 
a deficit. 

(3)  Common Stock Dividends

Cash dividends per common share declared by Centerior Energy 
during the nine months ended September 30, 1996 and 1995 were as 
follows:  

                       1996        1995
	Paid February 15      $.20        $.20
	Paid May 15            .20         .20
	Paid August 15         .20         .20
	Paid November 15       .20         .20

Common stock cash dividends declared by Cleveland Electric during 
the nine months ended September 30, 1996 and 1995 were as follows: 
 
                            1996        1995
                               (millions)

	Paid in February     $29.6         $--
	Paid in May           46.6        15.0
	Paid in August        29.6        29.6

Toledo Edison did not declare any common stock dividends during 
the nine months ended September 30, 1996 and 1995.  

(4)  Financing Activity

During the three months ended September 30, 1996, mandatory 
redemptions for Cleveland Electric consisted of $80 million 
principal amount of secured medium-term notes; $1 million of 
Serial Preferred Stock, $7.35 Series C; and $0.9 million of first 
mortgage bonds and pollution control notes.  Also, Cleveland 
Electric optionally purchased and retired 26,000 shares of Serial 
Preferred Stock, Adjustable Rate Series L, for $1.8 million.

(5)  Nuclear Fuel Financing

Nuclear fuel is financed for the Operating Companies through 
leases with a special-purpose corporation.  On August 2, 1996, the 
special-purpose corporation completed a transaction in which it 
issued $100 million aggregate amount of intermediate-term secured 
notes maturing in the 1997 through 2000 period.  On October 4, 
1996, the special-purpose corporation completed a two-year $100 
million bank credit arrangement, replacing $150 million of bank 
credit arrangements which terminated in October 1996.  The 
special-purpose corporation used the proceeds from these 
transactions to pay its outstanding borrowings, including $84 
million of intermediate-term secured notes which matured on 
September 30, 1996.

(6)  Generating Plant Lease Agreement

Cleveland Electric had entered into an agreement with Jersey 
Central Power & Light Company (Jersey Central) under which Jersey 
Central leased Cleveland Electric's ownership share (351,000 
kilowatts) of the Seneca Power Plant (Seneca), a pumped-storage, 
hydro-electric generating station.  The agreement began June 1, 
1996 and was expected to provide annual revenues of approximately 
$18 million.  The parties agreed to cancel the agreement effective 
October 2, 1996 because the Federal Energy Regulatory Commission 
(FERC) insisted on terms which were not economic to the parties.

(7)  Write-down of Inactive Production Facilities

In the first quarter of 1996, Toledo Edison wrote down the net 
book value of two inactive production facilities, $11.3 million, 
to "Other Income and Deductions, Net" resulting in nonoperating 
losses for Toledo Edison and Centerior Energy for that period.  
The net write-down was $7.2 million after taxes or, for Centerior 
Energy, $.05 per common share.  The write-down resulted from a 
decision that the facilities are no longer expected to provide 
revenues.

(8)  Commitments and Contingencies

Various legal actions, claims and regulatory proceedings covering 
several matters are pending against the Companies.  See "Item 3.  
Legal Proceedings" in the 1995 Form 10-K; "Part II, Item 5.  Other 
Information" in this Quarterly Report on Form 10-Q and in the 
First and Second Quarter 1996 Form 10-Qs; and "Item 5.  Other 
Events" in the Companies' combined Current Report on Form 8-K 
dated August 21, 1996.

On September 13, 1996, Centerior Energy and Ohio Edison Company (Ohio 
Edison) entered into an Agreement and Plan of Merger to form a new 
holding company, FirstEnergy Corp. (FirstEnergy).  See "Item 5.  Other 
Events" in the Companies' combined Current Report on Form 8-K dated 
September 13, 1996.  The merger agreement is conditioned upon, among 
other matters, approval by The Public Utilities Commission of Ohio 
(PUCO) of a FirstEnergy regulatory plan (Regulatory Plan) for the 
Operating Companies which is mutually acceptable to Ohio Edison and 
Centerior Energy.  Implementation of the Regulatory Plan is conditioned 
upon consummation of the merger.  As announced, the Regulatory Plan is 
expected to include (i) a price freeze through 2005 followed by a $300 
million price reduction in 2006; and (ii) a $2 billion aggregate 
reduction in assets through 2005, resulting from amounts that have been 
sold, revalued, recovered and amortized, and/or depreciated on an 
accelerated basis.  These provisions may be changed, and other 
provisions may be added, to the Regulatory Plan prior to its filing.  
Until the Regulatory Plan is filed, Centerior Energy cannot predict what 
the Plan's effect on the Operating Companies' regulatory assets will be, 
or whether the Plan will demonstrate that the Operating Companies will 
continue to comply with Statement of Financial Accounting Standards 
(SFAS) 71.  If it is determined that the Regulatory Plan ultimately 
approved by the PUCO does not provide for full recovery of costs and 
regulatory assets, or other events cause one or both of the Operating 
Companies to conclude that the SFAS 71 criteria are no longer met, one 
or both of the Operating Companies would be required to record a 
material charge against earnings to write off regulatory assets ($1.328 
billion for Cleveland Electric and $0.932 billion for Toledo Edison, 
aggregating $2.260 billion for Centerior Energy at September 30, 1996), 
and to evaluate whether the effects of the Regulatory Plan would cause 
an impairment of property, plant and equipment.  It is possible that 
only a portion of operations (such as nuclear operations) would no 
longer meet the criteria of SFAS 71, and, therefore, the  write-off 
would be limited to regulatory assets and/or property, plant and 
equipment that are not reflected in cost-based prices established for 
the remaining regulated operations.  Any such effects from the 
Regulatory Plan would be recorded at the time consummation of the merger 
becomes probable.  If the merger is not consummated, the Operating 
Companies are not obligated to adopt either of the two provisions 
described above.  Any asset revaluation must be consistent with the 
Operating Companies' objectives to become more competitive, reduce debt 
and provide the opportunity for share owners to receive   a fair return 
on their investment.  The Operating Companies continue to examine a 
number of accelerated cost recognition and asset recovery plans.

On October 17, 1996, the FERC issued an order authorizing the 
merger of Toledo Edison into Cleveland Electric without a hearing 
and without significant conditions.  The order included the FERC's 
conclusion that it was not necessary to require the Operating Companies 
to turn over control of their facilities to an independent system operator. 
The FERC also approved the Operating Companies' recently filed single-system, 
open-access transmission tariff.  A request for authorization to transfer
certain Nuclear Regulatory Commission licenses to the merged entity was 
recently withdrawn.  The merger agreement between Ohio Edison and Centerior 
Energy requires the approval of Ohio Edison prior to consummation 
of the proposed merger of the Operating Companies.  No decision on 
the proposed merger of the Operating Companies is expected prior 
to February 1997 when Ohio Edison and Centerior Energy common 
stock shareholders are expected to vote on approval of the Ohio 
Edison-Centerior Energy merger agreement.










<TABLE>
<CAPTION>
                     CENTERIOR ENERGY CORPORATION AND SUBSIDIARIES
                                   INCOME STATEMENT
                                     (Unaudited)
                         (Thousands, Except Per Share Amounts)



                                                                    Three Months Ended               Nine Months Ended
                                                                       September 30,                   September 30,
                                                                   ---------------------        ---------------------------
                                                                     1996         1995               1996            1995
                                                                   --------     --------        -----------     -----------
         <S>                                                     <C>          <C>             <C>             <C>
         OPERATING REVENUES                                      $ 727,119    $ 739,579       $  1,941,340    $  1,934,105


         OPERATING EXPENSES
           Fuel and Purchased Power                                122,920      127,914            348,152         361,008
           Other Operation and Maintenance                         169,711      167,818            475,379         458,973
           Generation Facilities Rental Expense, Net                39,853       39,873            119,559         119,576
           Depreciation and Amortization                            76,835       70,420            226,789         209,891
           Taxes, Other Than Federal Income Taxes                   80,129       81,961            247,492         246,341
           Deferred Operating Expenses, Net                         10,853      (16,772)            32,264         (47,542)
           Federal Income Taxes                                     54,385       63,827             93,739         114,769
                                                                   --------     --------        -----------     -----------
             Total Operating Expenses                              554,686      535,041          1,543,374       1,463,016
                                                                   --------     --------        -----------     -----------
         OPERATING INCOME                                          172,433      204,538            397,966         471,089

         NONOPERATING INCOME (LOSS)
           Allowance for Equity Funds Used During Construction         695          120              2,394           1,766
           Other Income and Deductions, Net                         (3,909)      (2,094)           (10,908)          1,176
           Deferred Carrying Charges                                    --       11,804                 --          34,999
           Federal Income Taxes - Credit (Expense)                     939          254              3,734          (2,543)
                                                                   --------     --------        -----------     -----------
             Total Nonoperating Income (Loss)                       (2,275)      10,084             (4,780)         35,398
                                                                   --------     --------        -----------     -----------
         INCOME BEFORE INTEREST CHARGES                            170,158      214,622            393,186         506,487

         INTEREST CHARGES
           Long-term Debt                                           81,192       89,204            247,841         263,939
           Short-term Debt                                           2,300        1,744              6,498           7,315
           Allowance for Borrowed Funds Used During Construction      (640)        (197)            (2,257)         (1,960)
                                                                   --------     --------        -----------     -----------
             Net Interest Charges                                   82,852       90,751            252,082         269,294
                                                                   --------     --------        -----------     -----------
         INCOME AFTER INTEREST CHARGES                              87,306      123,871            141,104         237,193

           Preferred Dividend Requirements of Subsidiaries          13,815       14,959             42,092          46,113
                                                                   --------     --------        -----------     -----------
         NET INCOME                                              $  73,491    $ 108,912       $     99,012    $    191,080
                                                                   ========     ========        ===========     ===========


         WEIGHTED AVERAGE COMMON SHARES OUTSTANDING                148,026      148,032            148,027         148,032
                                                                   ========     ========        ===========     ===========
         EARNINGS PER COMMON SHARE                               $     .50    $     .74       $        .67    $       1.29
                                                                   ========     ========        ===========     ===========



<FN>
         The accompanying notes as they relate to Centerior Energy are an integral part of this statement.
</TABLE>
        


<TABLE>
<CAPTION>

            CENTERIOR ENERGY CORPORATION AND SUBSIDIARIES
                          BALANCE SHEET
                          (Thousands)


                                                               September 30,     December 31,
                                                                  1996              1995
                                                               (Unaudited)
                                                               -----------       -----------
         ASSETS

PROPERTY, PLANT AND EQUIPMENT
  <S>                                                        <C>               <C>
  Utility Plant In Service                                   $  9,835,687      $  9,767,788
  Accumulated Depreciation and Amortization                    (3,218,650)       (3,036,181)
                                                               -----------       -----------
                                                                6,617,037         6,731,607
  Construction Work In Progress                                    92,875           101,031
                                                               -----------       -----------
                                                                6,709,912         6,832,638
  Nuclear Fuel, Net of Amortization                               203,992           199,707
  Other Property, Less Accumulated Depreciation                    92,434           101,745
                                                               -----------       -----------
                                                                7,006,338         7,134,090

CURRENT ASSETS
  Cash and Temporary Cash Investments                             284,993           179,038
  Amounts Due from Customers and Others, Net                      210,755           223,228
  Unbilled Revenues                                                 7,100           100,344
  Materials and Supplies, at Average Cost                          93,562           119,507
  Fossil Fuel Inventory, at Average Cost                           22,140            30,663
  Taxes Applicable to Succeeding Years                            109,810           255,142
  Other                                                            19,937            18,562
                                                               -----------       -----------
                                                                  748,297           926,484
REGULATORY AND OTHER ASSETS
  Amounts Due from Customers for Future Federal Income
   Taxes, Net                                                   1,058,817         1,067,374
  Unamortized Loss from Beaver Valley Unit 2 Sale                  92,837            96,206
  Unamortized Loss on Reacquired Debt                              83,728            88,893
  Carrying Charges and Operating Expenses                       1,024,207         1,053,220
  Nuclear Plant Decommissioning Trusts                            133,034           113,681
  Other                                                           157,610           163,156
                                                               -----------       -----------
                                                                2,550,233         2,582,530
                                                               -----------       -----------
                                                             $ 10,304,868      $ 10,643,104
                                                               ===========       ===========

         CAPITALIZATION AND LIABILITIES

CAPITALIZATION
  Common Stock Equity                                        $  1,964,802      $  1,983,560
  Preferred Stock
   With Mandatory Redemption Provisions                           189,267           220,440
   Without Mandatory Redemption Provisions                        448,325           450,871
  Long-Term Debt                                                3,612,166         3,733,892
                                                               -----------       -----------
                                                                6,214,560         6,388,763

CURRENT LIABILITIES
  Current Portion of Long-Term Debt and Preferred Stock           211,423           234,771
  Current Portion of Lease Obligations                             84,239            94,653
  Accounts Payable                                                114,422           152,909
  Accrued Taxes                                                   263,725           373,757
  Accrued Interest                                                 91,063            83,050
  Dividends Declared                                               43,771            14,666
  Other                                                            66,231            73,328
                                                               -----------       -----------
                                                                  874,874         1,027,134
DEFERRED CREDITS AND OTHER LIABILITIES
  Unamortized Investment Tax Credits                              254,294           263,352
  Accumulated Deferred Federal Income Taxes                     1,899,793         1,875,080
  Unamortized Gain from Bruce Mansfield Plant Sale                480,760           498,771
  Accumulated Deferred Rents for Bruce Mansfield Plant
   and Beaver Valley Unit 2                                       137,898           145,393
  Nuclear Fuel Lease Obligations                                  142,464           137,260
  Retirement Benefits                                             182,745           178,579
  Other                                                           117,480           128,772
                                                               -----------       -----------
                                                                3,215,434         3,227,207
COMMITMENTS AND CONTINGENCIES (Note 8)
                                                               -----------       -----------
                                                             $ 10,304,868      $ 10,643,104
                                                               ===========       ===========

<FN>
The accompanying notes as they relate to Centerior Energy are an integral part of this
statement.
</TABLE>



<TABLE>
<CAPTION>

                  CENTERIOR ENERGY CORPORATION AND SUBSIDIARIES
                                   CASH FLOWS
                                  (Unaudited)
                                  (Thousands)


                                                                             Nine Months Ended
                                                                               September 30,
                                                                        ------------------------
                                                                             1996        1995
                                                                        ----------- -----------
            
            CASH FLOWS FROM OPERATING ACTIVITIES                                    
              <S>                                                           <C>        <C>
              Net Income                                                    $99,012    $191,080
                                                                           --------    --------
              Adjustments to Reconcile Net Income  
              to Cash from Operating Activities:
                Depreciation and Amortization                               226,789     209,891
                Deferred Federal Income Tax                                  30,967      52,248
                Unbilled Revenues                                             6,344      11,000
                Deferred Fuel                                                10,777      11,438
                Deferred Carrying Charges                                        --     (34,999)
                Leased Nuclear Fuel Amortization                             58,212      92,682
                Deferred Operating Expenses, Net                             32,264     (47,542)
                Allowance for Equity Funds Used During Construction          (2,394)     (1,766)
                Changes in Amounts Due from Customers and Others, Net       (29,341)    (46,428)
                Proceeds from Accounts Receivable Securitization            135,223          --
                Changes in Inventories                                       34,468      15,355
                Changes in Accounts Payable                                 (38,487)     19,373
                Changes in Working Capital Affecting Operations              34,841      (9,829)
                Other Noncash Items                                         (15,969)      8,362
                                                                            --------    --------
                  Total Adjustments                                         483,694     279,785
                                                                            --------    --------
                  Net Cash from Operating Activities                        582,706     470,865
            
            CASH FLOWS FROM FINANCING ACTIVITIES
              First Mortgage Bond Issues                                         --     541,850
              Reacquired Common Stock                                           (20)         --
              Maturities, Redemptions and Sinking Funds                    (178,153)   (636,413)
              Nuclear Fuel Lease Obligations                                (67,962)    (69,298)
              Common Stock Dividends Paid                                   (88,816)    (88,819)
              Premiums, Discounts and Expenses                                 (561)    (13,955)
                                                                            --------    --------
                  Net Cash from Financing Activities                       (335,512)   (266,635)
            
            CASH FLOWS FROM INVESTING ACTIVITIES
              Cash Applied to Construction                                 (107,451)   (114,686)
              Interest Capitalized as Allowance for Borrowed Funds Used
                During Construction                                          (2,257)     (1,960)
              Contributions to Nuclear Plant Decommissioning Trusts         (16,994)    (11,794)
              Investment in Partnership                                     (21,164)         --
              Other Cash Received (Applied)                                   6,627     (26,776)
                                                                            --------    --------
                  Net Cash from Investing Activities                       (141,239)   (155,216)
                                                                            --------    --------
            NET CHANGE IN CASH AND TEMPORARY CASH INVESTMENTS               105,955      49,014
            CASH AND TEMPORARY CASH INVESTMENTS AT BEGINNING OF PERIOD      179,038     186,399
                                                                            --------    --------
            CASH AND TEMPORARY CASH INVESTMENTS AT END OF PERIOD           $284,993    $235,413
                                                                            ========    ========
            
            Other Payment Information:
              Interest (net of amounts capitalized)                        $235,000    $217,000
              Federal Income Taxes                                            5,200      77,900
            
<FN>            
            The accompanying notes as they relate to Centerior Energy are an integral part of this statement.  
</TABLE>

  
  



  
  
                 CENTERIOR ENERGY CORPORATION AND SUBSIDIARIES 
                    MANAGEMENT'S DISCUSSION AND ANALYSIS OF
               FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Capital Resources and Liquidity

Reference is made to "Management's Discussion and Analysis of Financial 
Condition and Results of Operations" contained in Item 7 of the 1995 
Form 10-K and in the First and Second Quarter 1996 Form 10-Qs.  The 
information under "Capital Resources and Liquidity" remains unchanged 
with the following exceptions:  

During the third quarter of 1996, Cleveland Electric redeemed or retired 
various securities as discussed in Note 4.  

In July 1996, Centerior Funding, a wholly owned subsidiary of Cleveland 
Electric, completed a public sale of $150 million of receivables-backed 
investor certificates in a transaction that qualifies for sale 
accounting treatment for financial reporting purposes.  Centerior 
Funding used the net proceeds of $148.9 million to retire $100 million 
of its receivables-backed investor certificates which were issued in May 
1996, repay its notes payable ($10 million to Cleveland Electric and $16 
million to Toledo Edison) and pay a $22.9 million dividend to Cleveland 
Electric.

As discussed in Note 5, a special-purpose corporation completed 
financing transactions in the 1996 third quarter and October 1996 to 
replace expiring nuclear fuel financing arrangements.

In October 1996, Cleveland Electric completed the purchase and 
retirement of $50 million principal amount of its 7.625% interest rate 
first mortgage bonds due in 2002 and $10 million principal amount of its 
7.42% interest rate secured medium-term notes due in 2001 for a total of 
$59.1 million.  Also in October 1996, Toledo Edison completed the 
purchase and retirement of $15 million principal amount of its 7.25% 
interest rate first mortgage bonds due in 1999 for $14.9 million.  The 
securities are included in current liabilities in the September 30, 1996 
balance sheet.

Additional first mortgage bonds may be issued by the Operating Companies 
under their respective mortgages on the basis of property additions, 
cash or refundable first mortgage bonds.  If the applicable interest 
coverage test is met, each Operating Company may issue first mortgage 
bonds on the basis of property additions and, under certain 
circumstances, refundable bonds.  At September 30, 1996, Cleveland 
Electric and Toledo Edison would have been permitted to issue 
approximately $571 million and $143 million of additional first mortgage 
bonds, respectively, after giving effect to the corresponding security 
retirements in October 1996 discussed above.  

Under its articles of incorporation, Toledo Edison cannot issue 
preferred stock unless certain earnings coverage requirements are met.  
Based on earnings for the 12 months ended September 30, 1996, Toledo 
Edison could not issue additional preferred stock.

Results of Operations

Factors contributing to the 1.7% third quarter decrease and 0.4% nine-
month increase in 1996 operating revenues from 1995 are shown as 
follows:

                                         Changes for Period Ended 
                                            September 30, 1996 
                                             Three	   	Nine
                 Factors	                		 Months	    Months  
                                          						(millions)
	Base Rates		                              $ 27.7     $ 40.2
	Kilowatt-hour Sales Volume and Mix       	 (36.3)     (22.1)
 Wholesale Revenues                          (3.4)      (3.1)
	Fuel Cost Recovery Revenues                 (1.3)     (10.0)
	Miscellaneous Revenues                       0.8        2.2
	Total                           	        $ (12.5)    $  7.2

The increases in 1996 base rates revenues resulted primarily from the 
April 1996 rate order issued by the PUCO for the Operating Companies.  
Renegotiated contracts for certain large industrial customers of the Operating 
Companies resulted in a decrease in base rates which partially offset 
the effect of the general price increase. 

Percentage changes between 1996 and 1995 billed electric kilowatt-hour 
sales are summarized as follows:  

                        Changes for Period Ended
                           September 30, 1996 
                             Three      Nine
		Customer Categories    	  Months     Months

		Residential               (14.9)%    (2.5)%
		Commercial                 (3.5)      0.9
		Industrial                  1.4       0.7
		Other                      (7.6)    (12.1)
		Total                      (5.1)     (1.6)

Third quarter 1996 residential, commercial and total kilowatt-hour sales 
decreased because of cooler summer weather in the 1996 period which 
reduced cooling-related demand.  Weather-normalized residential and 
commercial sales increased 0.6% and 3.8%, respectively, for the 1996 
period.  Weather-normalized commercial sales growth in the 1996 period 
is attributable to an increase in average customer usage of about 4%.  
Industrial sales increased primarily because of increased sales to large 
automotive manufacturers and the broad-based, smaller industrial 
customer group.  Other sales decreased because of less sales to 
wholesale and public authority customers.

Total kilowatt-hour sales decreased for the nine-month period in 1996 
because of decreases from weather-related demand and a 14% decline in 
wholesale sales.  Residential sales decreased because of the cooler 
summer weather in the 1996 period.  However, commercial and industrial 
sales increased for the 1996 nine-month period.  Colder winter and 
spring weather in the first six months of 1996 had boosted residential 
and commercial sales for the first half of 1996.  Weather-normalized 
residential and commercial sales increased 1.1% and 3%, respectively, 
for the 1996 nine-month period.  Weather-normalized commercial sales 
growth in the 1996 period is attributable to a 1% increase in the 
average number of customers and an increase in average customer usage of 
about 2%.  Increased sales to petroleum refineries and the broad-based, 
smaller industrial customer group were partially offset by less sales to 
large steel industry customers. 

Wholesale sales in 1996 were suppressed by soft market conditions and, 
during the first six months of 1996, limited power availability for bulk 
power transactions because of nuclear generating plant refueling and 
maintenance outages.

The decreases in 1996 fuel cost recovery revenues included in customer 
bills resulted from changes in the fuel cost recovery factors used by 
the Operating Companies to calculate these revenues.  The weighted 
average of the respective fuel cost recovery factors used for the third 
quarter of 1996 decreased about 2% for Cleveland Electric and increased 
about 1.5% for Toledo Edison compared to the weighted average of the 
respective fuel cost recovery factors used for the third quarter of 
1995.  The weighted average of the respective fuel cost recovery factors 
used for the 1996 nine-month period decreased about 5% for Cleveland 
Electric and increased about 2% for Toledo Edison compared to the 
weighted average of the respective fuel cost recovery factors used for 
the 1995 nine-month period.

Third quarter operating expenses in 1996 increased 3.7% from the 1995 
amount.  The cessation of the Rate Stabilization Program deferrals and 
the commencement of their amortization in December 1995 resulted in the 
decrease in deferred operating expenses.  Depreciation and amortization 
expenses increased because of a net increase in depreciation related to 
changes in depreciation rates approved in the April 1996 PUCO rate order 
and the cessation of the accelerated amortization of unrestricted 
investment tax credits under the Rate Stabilization Program, which was 
reported in 1995 as a reduction of depreciation expense.  Federal income 
taxes decreased as a result of lower pretax operating income.  Fuel and 
purchased power expenses decreased as lower fuel expense was partially 
offset by slightly higher purchased power expense. 

Other operation and maintenance expenses for the 1996 third quarter 
included a $22.7 million charge for an ongoing inventory reduction 
program.  The ongoing streamlining of the supply chain process includes 
a shift in management philosophy toward increased use of technology, 
consolidated warehousing and just-in-time purchase and delivery.  Other 
operation and maintenance expenses for the 1995 third quarter had 
included charges totaling $14.6 million for an inventory reduction and 
the recognition of costs associated with preliminary engineering 
studies.  Other cost-control measures helped to reduce third quarter 
1996 other operation and maintenance expenses below the third quarter 
1995 level, exclusive of the charges discussed above.

Third quarter 1996 nonoperating income decreased primarily because the 
deferral of carrying charges related to the Rate Stabilization Program 
ended in November 1995. 

Third quarter 1996 interest charges and preferred dividend requirements 
decreased because of the redemption of securities and refinancing at 
favorable terms.

Nine-month operating expenses in 1996 increased 5.5% from the 1995 
amount.  The cessation of the Rate Stabilization Program deferrals and 
the commencement of their amortization in December 1995 resulted in the 
decrease in deferred operating expenses.  Other operation and 
maintenance expenses increased because of increases in nuclear power 
production expenses (attributable to refueling and maintenance outages, 
and the end of accelerated amortization of certain excess interim spent 
nuclear fuel storage costs under the Rate Stabilization Program), the 
third quarter 1996 inventory reduction charge, and expenses related to 
distribution operations and improvements in customer service and sales 
and marketing efforts.  Depreciation and amortization expenses increased 
for the same reasons cited for the third quarter 1996 increase in these 
expenses.  Federal income taxes decreased as a result of lower pretax 
operating income.  Fuel and purchased power expenses decreased as lower 
fuel expense related to less generation was partially offset by higher 
purchased power expense.

A nine-month 1996 nonoperating loss resulted primarily from Toledo 
Edison's write-down of two inactive production facilities as discussed 
in Note 7.  The deferral of carrying charges related to the Rate 
Stabilization Program ended in November 1995. The nine-month 1996 
federal income tax credit for nonoperating income increased accordingly. 

Nine-month 1996 interest charges and preferred dividend requirements 
decreased because of the same reasons cited for the third quarter 1996 
decrease in these charges.












<TABLE>
<CAPTION>
               
                  THE CLEVELAND ELECTRIC ILLUMINATING COMPANY AND SUBSIDIARY
                               INCOME STATEMENT
                                  (Unaudited)
                                  (Thousands)
  
  
  
                                                                    Three Months Ended              Nine Months Ended
                                                                       September 30,                  September 30,
                                                                   ---------------------        -------------------------
                                                                     1996         1995             1996           1995
                                                                   --------     --------        ----------     ----------
         <S>                                                     <C>          <C>             <C>            <C>
         OPERATING REVENUES                                      $ 506,491    $ 525,833       $ 1,368,042    $ 1,360,578
  
  
         OPERATING EXPENSES
           Fuel and Purchased Power (1)                            102,941      110,104           304,883        317,997
           Other Operation and Maintenance                         115,118      113,421           319,333        308,390
           Generation Facilities Rental Expense, Net                13,892       13,892            41,675         41,675
           Depreciation and Amortization                            53,279       49,290           157,128        146,777
           Taxes, Other Than Federal Income Taxes                   56,537       58,288           176,297        174,535
           Deferred Operating Expenses, Net                          6,567      (11,229)           19,510        (31,686)
           Federal Income Taxes                                     37,434       47,140            66,804         81,592
                                                                   --------     --------        ----------     ----------
             Total Operating Expenses                              385,768      380,906         1,085,630      1,039,280
                                                                   --------     --------        ----------     ----------
         OPERATING INCOME                                          120,723      144,927           282,412        321,298
  
         NONOPERATING INCOME (LOSS)
           Allowance for Equity Funds Used During Construction         366          290             1,465          1,256
           Other Income and Deductions, Net                         (4,506)         804            (3,873)         1,941
           Deferred Carrying Charges                                    --        7,991                --         23,354
           Federal Income Taxes - Credit (Expense)                   1,449         (538)            1,731         (1,441)
                                                                   --------     --------        ----------     ----------
             Total Nonoperating Income (Loss)                       (2,691)       8,547              (677)        25,110
                                                                   --------     --------        ----------     ----------
         INCOME BEFORE INTEREST CHARGES                            118,032      153,474           281,735        346,408
  
         INTEREST CHARGES
           Long-Term Debt                                           58,628       62,889           179,414        184,194
           Short-Term Debt                                           1,063          844             3,127          2,638
           Allowance for Borrowed Funds Used During Construction      (380)        (236)           (1,526)        (1,614)
                                                                   --------     --------        ----------     ----------
             Net Interest Charges                                   59,311       63,497           181,015        185,218
                                                                   --------     --------        ----------     ----------
         NET INCOME                                                 58,721       89,977           100,720        161,190
  
           Preferred Dividend Requirements                           9,563       10,452            29,408         32,127
                                                                   --------     --------        ----------     ----------
         EARNINGS AVAILABLE FOR COMMON STOCK                     $  49,158    $  79,525       $    71,312    $   129,063
                                                                   ========     ========        ==========     ==========
  
  
  
  
         (1)  Includes purchased power expense for
              purchases from Toledo Edison.                      $  24,933    $  25,939       $    77,513    $    75,496
  
<FN>  
         The accompanying notes as they relate to Cleveland Electric are an integral part of this statement.
</TABLE>
  
         









<TABLE>
<CAPTION>

             
                 THE CLEVELAND ELECTRIC ILLUMINATING COMPANY AND SUBSIDIARY
                                       BALANCE SHEET
                                      (Thousands)


                                                               September 30,     December 31,
                                                                  1996              1995
                                                               (Unaudited)
                                                               -----------       -----------
         ASSETS

PROPERTY, PLANT AND EQUIPMENT
  <S>                                                        <C>               <C>
  Utility Plant In Service                                   $  6,911,857      $  6,871,468
  Accumulated Depreciation and Amortization                    (2,212,724)       (2,094,092)
                                                               -----------       -----------
                                                                4,699,133         4,777,376
  Construction Work In Progress                                    69,801            73,250
                                                               -----------       -----------
                                                                4,768,934         4,850,626
  Nuclear Fuel, Net of Amortization                               121,678           121,966
  Other Property, Less Accumulated Depreciation                    56,707            58,299
                                                               -----------       -----------
                                                                4,947,319         5,030,891

CURRENT ASSETS
  Cash and Temporary Cash Investments                              85,234            69,770
  Amounts Due from Customers and Others, Net                      191,445           152,339
  Amounts Due from Affiliates                                       1,502             4,729
  Unbilled Revenues                                                 5,000            78,500
  Materials and Supplies, at Average Cost                          60,276            79,540
  Fossil Fuel Inventory, at Average Cost                           11,104            21,391
  Taxes Applicable to Succeeding Years                             77,935           184,099
  Other                                                            10,029             7,197
                                                               -----------       -----------
                                                                  442,525           597,565
REGULATORY AND OTHER ASSETS
  Amounts Due from Customers for Future Federal Income
   Taxes, Net                                                     643,024           651,264
  Unamortized Loss on Reacquired Debt                              58,681            61,252
  Carrying Charges and Operating Expenses                         626,007           643,561
  Nuclear Plant Decommissioning Trusts                             71,986            61,497
  Other                                                            85,788           105,696
                                                               -----------       -----------
                                                                1,485,486         1,523,270
                                                               -----------       -----------
                                                             $  6,875,330      $  7,151,726
                                                               ===========       ===========

         CAPITALIZATION AND LIABILITIES

CAPITALIZATION
  Common Stock Equity                                        $  1,102,128      $  1,126,762
  Preferred Stock
   With Mandatory Redemption Provisions                           185,912           215,420
   Without Mandatory Redemption Provisions                        238,325           240,871
  Long-Term Debt                                                2,599,076         2,665,981
                                                               -----------       -----------
                                                                4,125,441         4,249,034

CURRENT LIABILITIES
  Current Portion of Long-Term Debt and Preferred Stock           140,874           176,474
  Current Portion of Lease Obligations                             49,468            54,634
  Accounts Payable                                                 52,486            89,038
  Accounts and Notes Payable to Affiliates                         59,437            63,961
  Accrued Taxes                                                   227,225           296,141
  Accrued Interest                                                 65,185            58,608
  Dividends Declared                                                6,092            15,818
  Other                                                            40,947            40,766
                                                               -----------       -----------
                                                                  641,714           795,440
DEFERRED CREDITS AND OTHER LIABILITIES
  Unamortized Investment Tax Credits                              178,088           184,002
  Accumulated Deferred Federal Income Taxes                     1,311,649         1,298,260
  Unamortized Gain from Bruce Mansfield Plant Sale                299,467           310,678
  Accumulated Deferred Rents for Bruce Mansfield Plant             98,183            91,604
  Nuclear Fuel Lease Obligations                                   85,465            85,569
  Retirement Benefits                                              71,352            65,424
  Other                                                            63,971            71,715
                                                               -----------       -----------
                                                                2,108,175         2,107,252
COMMITMENTS AND CONTINGENCIES (Note 8)
                                                               -----------       -----------
                                                             $  6,875,330      $  7,151,726
                                                               ===========       ===========

<FN>
The accompanying notes as they relate to Cleveland Electric are an integral part of this
statement.

</TABLE>




<TABLE>
<CAPTION>
                     THE CLEVELAND ELECTRIC ILLUMINATING COMPANY AND SUBSIDIARY
                                                   CASH FLOWS
                                                  (Unaudited)
                                                  (Thousands)




                                                                             Nine Months Ended
                                                                               September 30,
                                                                              1996        1995

                                                                        ----------- -----------
            
            CASH FLOWS FROM OPERATING ACTIVITIES                                    
              <S>                                                          <C>         <C>
              Net Income                                                   $100,720    $161,190
                                                                        -----------   ---------
              Adjustments to Reconcile Net Income  
              to Cash from Operating Activities:
                Depreciation and Amortization                               157,128     146,777
                Deferred Federal Income Tax                                  21,514      36,106
                Unbilled Revenues                                             5,500       9,000
                Deferred Fuel                                                 3,245      13,900
                Deferred Carrying Charges                                        --     (23,354)
                Leased Nuclear Fuel Amortization                             33,537      52,552
                Deferred Operating Expenses, Net                             19,510     (31,686)
                Allowance for Equity Funds Used During Construction          (1,465)     (1,256)
                Changes in Amounts Due from Customers and Others, Net       (16,219)    (35,066)
                Proceeds from Accounts Receivable Securitization             57,988          --
                Changes in Inventories                                       29,551       6,824
                Changes in Accounts Payable                                 (36,552)     (3,565)
                Changes in Working Capital Affecting Operations              38,596     (16,558)
                Other Noncash Items                                          (7,157)     (2,438)
                                                                            --------    --------
                  Total Adjustments                                         305,176     151,236
                                                                            --------    --------
                  Net Cash from Operating Activities                        405,896     312,426
            
            CASH FLOWS FROM FINANCING ACTIVITIES
              Notes Payable to Affiliates                                     1,281     (58,100)
              First Mortgage Bond Issues                                         --     442,850
              Maturities, Redemptions and Sinking Funds                    (134,288)   (428,455)
              Nuclear Fuel Lease Obligations                                (38,532)    (39,776)
              Dividends Paid                                               (135,598)    (77,078)
              Premiums, Discounts and Expenses                                 (307)     (8,644)
                                                                            --------    --------
                  Net Cash from Financing Activities                       (307,444)   (169,203)
            
            CASH FLOWS FROM INVESTING ACTIVITIES
              Cash Applied to Construction                                  (74,747)    (89,534)
              Interest Capitalized as Allowance for Borrowed Funds Used
                During Construction                                          (1,526)     (1,614)
              Contributions to Nuclear Plant Decommissioning Trusts          (9,194)     (6,408)
              Other Cash Received (Applied)                                   2,479     (18,389)
                                                                            --------    --------
                  Net Cash from Investing Activities                        (82,988)   (115,945)
                                                                            --------    --------
            NET CHANGE IN CASH AND TEMPORARY CASH INVESTMENTS                15,464      27,278
            CASH AND TEMPORARY CASH INVESTMENTS AT BEGINNING OF PERIOD       69,770      65,643
                                                                            --------    --------
            CASH AND TEMPORARY CASH INVESTMENTS AT END OF PERIOD            $85,234     $92,921
                                                                            ========    ========
            
            Other Payment Information:
              Interest (net of amounts capitalized)                        $169,000    $149,000
              Federal Income Taxes (Refund)                                  (6,200)     60,300
            
<FN>            
            The accompanying notes as they relate to Cleveland Electric are an integral part of this statement. 
</TABLE>



       THE CLEVELAND ELECTRIC ILLUMINATING COMPANY AND SUBSIDIARY 
                  MANAGEMENT'S DISCUSSION AND ANALYSIS OF
    		         FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Capital Resources and Liquidity

Reference is made to "Management's Discussion and Analysis of Financial 
Condition and Results of Operations" contained in Item 7 of the 1995 
Form 10-K and in the First and Second Quarter 1996 Form 10-Qs.  The 
information under "Capital Resources and Liquidity" remains unchanged 
with the following exceptions:  

During the third quarter of 1996, Cleveland Electric redeemed or retired 
various securities as discussed in Note 4.  

In July 1996, Centerior Funding, a wholly owned subsidiary of Cleveland 
Electric, completed a public sale of $150 million of receivables-backed 
investor certificates in a transaction that qualifies for sale 
accounting treatment for financial reporting purposes.  Centerior 
Funding used the net proceeds of $148.9 million to retire $100 million 
of its receivables-backed investor certificates which were issued in May 
1996, repay its notes payable ($10 million to Cleveland Electric and $16 
million to Toledo Edison) and pay a $22.9 million dividend to Cleveland 
Electric.

As discussed in Note 5, a special-purpose corporation completed 
financing transactions in the 1996 third quarter and October 1996 to 
replace expiring nuclear fuel financing arrangements.  

In October 1996, Cleveland Electric completed the purchase and 
retirement of $50 million principal amount of its 7.625% interest rate 
first mortgage bonds due in 2002 and $10 million principal amount of its 
7.42% interest rate secured medium-term notes due in 2001 for a total of 
$59.1 million.  The securities are included in current liabilities in 
the September 30, 1996 balance sheet.

Additional first mortgage bonds may be issued by Cleveland Electric 
under its mortgage on the basis of property additions, cash or 
refundable first mortgage bonds.  If the applicable interest coverage 
test is met, Cleveland Electric may issue first mortgage bonds on the 
basis of property additions and, under certain circumstances, refundable 
bonds.  At September 30, 1996, Cleveland Electric would have been 
permitted to issue approximately $571 million of additional first 
mortgage bonds after giving effect to the October 1996 security 
retirements discussed above.  

Results of Operations

Factors contributing to the 3.7% third quarter decrease and 0.5% nine-
month increase in 1996 operating revenues from 1995 are shown as 
follows:  
                                 Changes for Period Ended 
                                    September 30, 1996 
                                      Three      Nine
		Factors                             Months     Months
	                                         (millions) 

	Base Rates                          $ 20.2       33.4
	Kilowatt-hour Sales Volume and Mix	  (38.2)     (22.4)
	Wholesale Revenues                    (0.9)       3.9 
	Fuel Cost Recovery Revenues           (1.8)     (11.5) 
	Miscellaneous Revenues                1.44         .1
	Total                               $(19.3)    $  7.5

The increases in 1996 base rates revenues resulted primarily from the 
April 1996 rate order issued by the PUCO.  Renegotiated contracts for 
certain large industrial customers resulted in a decrease in base rates 
which partially offset the effect of the general price increase.

Percentage changes between 1996 and 1995 billed electric kilowatt-hour 
sales are summarized as follows:                   

           				        Changes for Period Ended 
                          September 30, 1996
     			                 Three           Nine
		Customer Categories    Months         Months

		Residential            (15.4)%         (2.8)%
		Commercial              (3.7)           0.5
		Industrial              (0.6)          (0.8)
		Other                    5.8            5.2
		Total                   (4.4)          (0.3)

Third quarter 1996 residential, commercial and total kilowatt-hour sales 
decreased because of cooler summer weather in the 1996 period which 
reduced cooling-related demand.  Weather-normalized residential and 
commercial sales increased 0.8% and 2.8%, respectively, for the 1996 
period.  Weather-normalized commercial sales growth in the 1996 period 
is attributable to an increase in average customer usage of about 3%.  
Industrial sales decreased as less sales to large automotive 
manufacturers and the broad-based, smaller industrial customer group 
were partially offset by increased sales to large steel industry 
customers.  Other sales increased as increased wholesale sales were 
partially offset by less sales to public authorities.

Total kilowatt-hour sales decreased for the nine-month period in 1996 as 
decreases from weather-related demand were partially offset by a 10% 
increase in wholesale sales.  Residential sales decreased because of the 
cooler summer weather in the 1996 period.  Colder winter and spring 
weather in the first six months of 1996 had boosted residential and 
commercial sales for the first half of 1996.  Weather-normalized 
residential and commercial sales increased 1.2% and 2.4%, respectively, 
for the 1996 nine-month period.  Weather-normalized commercial sales 
growth in the 1996 period is attributable to a 1% increase in the 
average number of customers and an increase in average customer usage of 
about 1.5%.  Industrial sales decreased primarily because of less sales 
to large automotive manufacturers and the broad-based, smaller 
industrial customer group.

The decreases in 1996 fuel cost recovery revenues included in customer 
bills resulted from decreases in the fuel cost recovery factors used in 
1996 to calculate these revenues compared to those used in 1995.  The 
decreases in the weighted averages of the fuel cost recovery factors for 
1996 were about 2% and 5% for the third quarter and nine months, 
respectively.

Miscellaneous revenues in 1996 increased from the 1995 amounts primarily 
because of the new revenues related to the Seneca lease agreement 
discussed in Note 6.

Third quarter operating expenses in 1996 increased 1.3% from the 1995 
amount.  The cessation of the Rate Stabilization Program deferrals and 
the commencement of their amortization in December 1995 resulted in the 
decrease in deferred operating expenses.  Depreciation and amortization 
expenses increased because of a net increase in depreciation related to 
changes in depreciation rates approved in the April 1996 PUCO rate order 
and the cessation of the accelerated amortization of unrestricted 
investment tax credits under the Rate Stabilization Program, which was 
reported in 1995 as a reduction of depreciation expense.  Federal income 
taxes decreased as a result of lower pretax operating income.  Lower 
fuel and purchased power expenses resulted from both lower fuel expense 
and lower purchased power expense. 

Other operation and maintenance expenses for the 1996 third quarter 
included a $16.6 million charge for an ongoing inventory reduction 
program.  The ongoing streamlining of the supply chain process includes 
a shift in management philosophy toward increased use of technology, 
consolidated warehousing and just-in-time purchase and delivery.  Other 
operation and maintenance expenses for the 1995 third quarter had 
included charges totaling $11.4 million for an inventory reduction and 
the recognition of costs associated with preliminary engineering 
studies.  Other cost-control measures helped to reduce third quarter 
1996 other operation and maintenance expenses below the third quarter 
1995 level, exclusive of the charges discussed above.

Third quarter 1996 nonoperating income decreased primarily because the 
deferral of carrying charges related to the Rate Stabilization Program 
ended in November 1995. The third quarter 1996 federal income tax credit 
for nonoperating income increased accordingly. 

Nine-month operating expenses in 1996 increased 4.5% from the 1995 
amount.  The cessation of the Rate Stabilization Program deferrals and 
the commencement of their amortization in December 1995 resulted in the 
decrease in deferred operating expenses.  Other operation and 
maintenance expenses increased because of increases in nuclear power 
production expenses (attributable to refueling and maintenance outages, 
and the end of accelerated amortization of certain excess interim spent 
nuclear fuel storage costs under the Rate Stabilization Program), the 
third quarter 1996 inventory reduction charge, and expenses related to 
distribution operations and improvements in customer service and sales 
and marketing efforts.  Depreciation and amortization expenses increased 
for the same reasons cited for the third quarter 1996 increase in these 
expenses.  Federal income taxes decreased as a result of lower pretax 
operating income.  Lower fuel and purchased power expenses resulted 
primarily from less amortization of previously deferred fuel costs than 
the amount amortized in 1995. 

Nine-month 1996 nonoperating income decreased because the deferral of 
carrying charges related to the Rate Stabilization Program ended in 
November 1995.  The nine-month 1996 federal income tax credit for 
nonoperating income increased accordingly. 









<TABLE>
<CAPTION>
                         THE TOLEDO EDISON COMPANY
                              INCOME STATEMENT
                                (Unaudited)
                                (Thousands)



                                                            Three Months Ended           Nine Months Ended
                                                               September 30,               September 30,
                                                          ---------------------        ---------------------
                                                            1996         1995            1996        1995
                                                          --------     --------        --------     --------
<S>                                                     <C>          <C>             <C>          <C>
OPERATING REVENUES (1)                                  $ 252,198    $ 245,830       $ 673,931    $ 667,257


OPERATING EXPENSES
  Fuel and Purchased Power                                 46,928       44,239         126,348      120,196
  Other Operation and Maintenance                          59,287       60,881         174,050      169,553
  Generation Facilities Rental Expense, Net                25,961       25,981          77,884       77,901
  Depreciation and Amortization                            23,556       21,130          69,661       63,114
  Taxes, Other Than Federal Income Taxes                   23,503       23,555          70,928       71,452
  Deferred Operating Expenses, Net                          4,287       (5,543)         12,755      (15,856)
  Federal Income Taxes                                     17,011       16,730          27,110       33,404
                                                          --------     --------        --------     --------
    Total Operating Expenses                              200,533      186,973         558,736      519,764
                                                          --------     --------        --------     --------
OPERATING INCOME                                           51,665       58,857         115,195      147,493

NONOPERATING INCOME (LOSS)
  Allowance for Equity Funds Used During Construction         330         (169)            929          510
  Other Income and Deductions, Net                             96       (2,905)         (8,683)         223
  Deferred Carrying Charges                                    --        3,813              --       11,645
  Federal Income Taxes - Credit (Expense)                     (92)       1,100           3,218         (182)
                                                          --------     --------        --------     --------
    Total Nonoperating Income (Loss)                          334        1,839          (4,536)      12,196
                                                          --------     --------        --------     --------
INCOME BEFORE INTEREST CHARGES                             51,999       60,696         110,659      159,689

INTEREST CHARGES
  Long-Term Debt                                           22,564       26,315          68,427       79,746
  Short-Term Debt                                           1,712          905           4,075        5,370
  Allowance for Borrowed Funds Used During Construction      (260)          39            (731)        (346)
                                                          --------     --------        --------     --------
    Net Interest Charges                                   24,016       27,259          71,771       84,770
                                                          --------     --------        --------     --------
NET INCOME                                                 27,983       33,437          38,888       74,919

  Preferred Dividend Requirements                           4,250        4,507          12,683       13,986
                                                          --------     --------        --------     --------
EARNINGS AVAILABLE FOR COMMON STOCK                     $  23,733    $  28,930       $  26,205    $  60,933
                                                          ========     ========        ========     ========




(1) Includes revenues from bulk power sales
    to Cleveland Electric.                              $  24,933    $  25,939       $  77,513    $  75,496

<FN>
The accompanying notes as they relate to Toledo Edison are an integral part of this statement.
</TABLE>
<TABLE>
<CAPTION>

                    THE TOLEDO EDISON COMPANY
                           BALANCE SHEET
                             (Thousands)


                                                               September 30,     December 31,
                                                                  1996              1995
                                                               (Unaudited)
                                                               -----------       -----------
         ASSETS

PROPERTY, PLANT AND EQUIPMENT
  <S>                                                        <C>               <C>
  Utility Plant In Service                                   $  2,923,830      $  2,896,320
  Accumulated Depreciation and Amortization                    (1,005,926)         (942,088)
                                                               -----------       -----------
                                                                1,917,904         1,954,232
  Construction Work In Progress                                    23,073            27,781
                                                               -----------       -----------
                                                                1,940,977         1,982,013
  Nuclear Fuel, Net of Amortization                                82,314            77,741
  Other Property, Less Accumulated Depreciation                     8,283            19,555
                                                               -----------       -----------
                                                                2,031,574         2,079,309

CURRENT ASSETS
  Cash and Temporary Cash Investments                             164,664            93,669
  Amounts Due from Customers and Others, Net                       15,973            68,077
  Amounts Due from Affiliates                                      22,054            18,905
  Unbilled Revenues                                                 2,100            21,844
  Materials and Supplies, at Average Cost                          33,286            39,967
  Fossil Fuel Inventory, at Average Cost                           11,036             9,273
  Taxes Applicable to Succeeding Years                             31,875            71,044
  Other                                                             3,346             4,315
                                                               -----------       -----------
                                                                  284,334           327,094
REGULATORY AND OTHER ASSETS
  Amounts Due from Customers for Future Federal Income
   Taxes, Net                                                     416,034           416,351
  Unamortized Loss from Beaver Valley Unit 2 Sale                  92,837            96,206
  Unamortized Loss on Reacquired Debt                              25,047            27,640
  Carrying Charges and Operating Expenses                         398,200           409,659
  Nuclear Plant Decommissioning Trusts                             61,048            52,185
  Other                                                            65,010            65,345
                                                               -----------       -----------
                                                                1,058,176         1,067,386
                                                               -----------       -----------
                                                             $  3,374,084      $  3,473,789
                                                               ===========       ===========

         CAPITALIZATION AND LIABILITIES

CAPITALIZATION
  Common Stock Equity                                        $    789,059      $    762,877
  Preferred Stock
   With Mandatory Redemption Provisions                             3,355             5,020
   Without Mandatory Redemption Provisions                        210,000           210,000
  Long-Term Debt                                                1,013,090         1,067,603
                                                               -----------       -----------
                                                                2,015,504         2,045,500

CURRENT LIABILITIES
  Current Portion of Long-Term Debt and Preferred Stock            70,549            58,297
  Current Portion of Lease Obligations                             34,771            40,019
  Accounts Payable                                                 58,971            56,233
  Accounts and Notes Payable to Affiliates                         26,160            53,245
  Accrued Taxes                                                    38,717            78,178
  Accrued Interest                                                 25,884            24,250
  Other                                                            16,039            18,607
                                                               -----------       -----------
                                                                  271,091           328,829
DEFERRED CREDITS AND OTHER LIABILITIES
  Unamortized Investment Tax Credits                               76,206            79,350
  Accumulated Deferred Federal Income Taxes                       582,247           573,035
  Unamortized Gain from Bruce Mansfield Plant Sale                181,293           188,093
  Accumulated Deferred Rents for Bruce Mansfield Plant
   and Beaver Valley Unit 2                                        39,715            53,789
  Nuclear Fuel Lease Obligations                                   56,758            51,691
  Retirement Benefits                                             102,508           103,060
  Other                                                            48,762            50,442
                                                               -----------       -----------
                                                                1,087,489         1,099,460
COMMITMENTS AND CONTINGENCIES (Note 8)
                                                               -----------       -----------
                                                             $  3,374,084      $  3,473,789
                                                               ===========       ===========

<FN>
The accompanying notes as they relate to Toledo Edison are an integral part of this
statement.
</TABLE>
                   

<TABLE>
<CAPTION>

                        THE TOLEDO EDISON COMPANY
                               CASH FLOWS
                               (Unaudited)
                               (Thousands)




                                                                           Nine Months Ended
                                                                              September 30,
                                                                        ------------------------
                                                                            1996        1995
                                                                        ----------- -----------
            
            CASH FLOWS FROM OPERATING ACTIVITIES                                    
              <S>                                                           <C>         <C>
              Net Income                                                    $38,888     $74,919 
                                                                           --------    --------
              Adjustments to Reconcile Net Income  
              to Cash from Operating Activities:
                Depreciation and Amortization                                69,661      63,114
                Deferred Federal Income Tax                                   9,863      16,244
                Unbilled Revenues                                               844       2,000
                Deferred Fuel                                                 7,532      (2,463)
                Deferred Carrying Charges                                        --     (11,645)
                Leased Nuclear Fuel Amortization                             24,677      40,131
                Deferred Operating Expenses, Net                             12,755     (15,856)
                Allowance for Equity Funds Used During Construction            (929)       (510)
                Changes in Amounts Due from Customers and Others, Net       (12,597)    (11,398)
                Proceeds from Accounts Receivable Securitization             77,235          --
                Changes in Inventories                                        4,918       8,531
                Changes in Accounts Payable                                   2,738      27,645
                Changes in Working Capital Affecting Operations              (3,260)     (2,014)
                Other Noncash Items                                          (8,812)     10,800
                                                                            --------    --------
                  Total Adjustments                                         184,625     124,579
                                                                            --------    --------
                  Net Cash from Operating Activities                        223,513     199,498
            
            CASH FLOWS FROM FINANCING ACTIVITIES
              Notes Payable to Affiliates                                   (20,950)         --
              First Mortgage Bond Issues                                         --      99,000
              Maturities, Redemptions and Sinking Funds                     (43,865)   (199,183)
              Nuclear Fuel Lease Obligations                                (29,430)    (29,522)
              Dividends Paid                                                (12,702)    (14,155)
              Premiums, Discounts and Expenses                                 (254)     (5,311)
                                                                            --------    --------
                  Net Cash from Financing Activities                       (107,201)   (149,171)
            
            CASH FLOWS FROM INVESTING ACTIVITIES
              Cash Applied to Construction                                  (32,704)    (25,152)
              Interest Capitalized as Allowance for Borrowed Funds Used
                During Construction                                            (731)       (346)
              Loans to Affiliates                                            (6,281)         --
              Contributions to Nuclear Plant Decommissioning Trusts          (7,800)     (5,386)
              Other Cash Received (Applied)                                   2,199      (5,421)
                                                                            --------    --------
                  Net Cash from Investing Activities                        (45,317)    (36,305)
                                                                            --------    --------
            NET CHANGE IN CASH AND TEMPORARY CASH INVESTMENTS                70,995      14,022
            CASH AND TEMPORARY CASH INVESTMENTS AT BEGINNING OF PERIOD       93,669      87,800
                                                                            --------    --------
            CASH AND TEMPORARY CASH INVESTMENTS AT END OF PERIOD           $164,664    $101,822
                                                                            ========    ========
            
            Other Payment Information:
              Interest (net of amounts capitalized)                         $66,000     $69,000
              Federal Income Taxes                                           10,400      17,500
<FN>            
           
            The accompanying notes as they relate to Toledo Edison are an integral part of this statement.
</TABLE>





                           THE TOLEDO EDISON COMPANY 
                    MANAGEMENT'S DISCUSSION  AND ANALYSIS OF
                   FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Capital Resources and Liquidity

Reference is made to "Management's Discussion and Analysis of Financial 
Condition and Results of Operations" contained in Item 7 of the 1995 
Form 10-K and in the First and Second Quarter 1996 Form 10-Qs.  The 
information under "Capital Resources and Liquidity" remains unchanged 
with the following exceptions:
  
As discussed in Note 5, a special-purpose corporation completed 
financing transactions in the 1996 third quarter and October 1996 to 
replace expiring nuclear fuel financing arrangements.

In October 1996, Toledo Edison completed the purchase and retirement of 
$15 million principal amount of its 7.25% interest rate first mortgage 
bonds due in 1999 for $14.9 million.  The securities are included in 
current liabilities in the September 30, 1996 balance sheet.

Additional first mortgage bonds may be issued by Toledo Edison under its 
mortgage on the basis of property additions, cash or refundable first 
mortgage bonds.  If the applicable interest coverage test is met, Toledo 
Edison may issue first mortgage bonds on the basis of property additions 
and, under certain circumstances, refundable bonds.  At September 30, 
1996, Toledo Edison would have been permitted to issue approximately 
$143 million of additional first mortgage bonds after giving effect to 
the October 1996 first mortgage bond retirement discussed above.
Under its articles of incorporation, Toledo Edison cannot issue 
preferred stock unless certain earnings coverage requirements are met.  
Based on earnings for the 12 months ended September 30, 1996, Toledo 
Edison could not issue additional preferred stock.  

Results of Operations

Factors contributing to the 2.6% and 1% increases in 1996 operating 
revenues from 1995 for the third quarter and nine months, respectively, 
are shown as follows:

                                     Changes for Period Ended 
                                         September 30, 1996 
                                       Three              Nine
		Factors                              Months            Months
                                             (millions)

	Base Rates                           $ 7.5             $ 6.8
	Kilowatt-hour Sales Volume and Mix     1.9               0.4
	Wholesale Revenues                    (1.9)             (1.1)
	Fuel Cost Recovery Revenues            0.5               1.5
	Miscellaneous Revenues                (1.6)             (0.9)
	Total                                $ 6.4             $ 6.7

The increase in third quarter base rates revenues in 1996 resulted 
primarily from the April 1996 rate order issued by the PUCO.  
Renegotiated contracts for certain large industrial customers also 
resulted in a decrease in base rates which partially offset the effect 
of the general price increase.

For the nine-month period in 1996, the impact of the April 1996 price 
increase was offset by a change in the implementation of summer prices. 
As a result of this change, higher summer prices were in effect for 
most customers from June through September 1996.  Previously, higher 
summer prices were in effect from May through September.  Consequently, 
base rates revenues for the May 1996 billing period were lower relative 
to the May 1995 amount.  Renegotiated contracts for certain large 
industrial customers also resulted in a decrease in base rates which 
partially offset the effect of the general price increase.

Percentage changes between 1996 and 1995 billed electric kilowatt-hour 
sales are summarized as follows:

                      Changes for Period Ended 
                          September 30, 1996
                       Three              Nine
	Customer Categories   Months            Months

	Residential           (13.7)%            (1.8)%
	Commercial             (3.0)              2.1
	Industrial              5.0               3.5
	Other                 (12.0)             (9.5)
	Total                  (4.9)             (1.3)

Third quarter 1996 total kilowatt-hour sales decreased as less 
residential and commercial sales, along with less wholesale sales 
(included in the "Other" category), completely offset increased industrial 
sales.  Residential and commercial sales decreased because of the cooler 
summer weather in the third quarter of 1996 versus the third quarter of 1995, 
which reduced cooling-related demand.  Weather-normalized commercial 
sales increased 7.6% for the 1996 period.  Weather-normalized commercial 
sales growth in the 1996 period is attributable to a 1% increase in the 
average number of customers and an increase in average customer usage of 
about 6%.  Industrial sales increased on the strength of increased sales 
to large automotive and glass manufacturers. 

Total kilowatt-hour sales for the nine-month period in 1996 decreased as 
less residential and wholesale sales completely offset increased 
commercial and industrial sales.  Residential sales decreased because of 
the cooler summer weather in the 1996 period.  Colder winter and spring 
weather in the first six months of 1996 had boosted residential and 
commercial sales for the first half of 1996.  Weather-normalized 
residential and commercial sales increased 0.9% and 5.1%, respectively, 
for the 1996 nine-month period.  Weather-normalized commercial sales 
growth in the 1996 period is attributable to a 1.6% increase in the 
average number of customers and an increase in average customer usage of 
about 3.5%.  Industrial sales increased on the strength of increased 
sales to petroleum refineries, large automotive manufacturers and the 
broad-based, smaller industrial customer group. 

Wholesale sales in 1996 were suppressed by soft market conditions and, 
during the first six months of 1996, limited power availability for bulk 
power transactions because of nuclear generating plant refueling and 
maintenance outages.

The increases in 1996 fuel cost recovery revenues included in customer 
bills resulted from increases in the fuel cost recovery factors used in 
1996 to calculate these revenues compared to those used in 1995.  The 
increases in the weighted averages of the fuel cost recovery factors for 
1996 were about 1.5% and 2% for the third quarter and nine months, 
respectively.                 
             
Third quarter operating expenses in 1996 increased 7.3% from the 1995 
amount. The cessation of the Rate Stabilization Program deferrals and 
the commencement of their amortization in December 1995 resulted in the 
decrease in deferred operating expenses.  Fuel and purchased power 
expenses increased because of higher purchased power expense.  Depreciation 
and amortization expenses increased because of a net increase in 
depreciation related to changes in depreciation rates approved in the April
1996 PUCO rate order and the cessation of the accelerated amortization of 
unrestricted investment tax credits under the Rate Stabilization Program, 
which was reported in 1995 as a reduction of depreciation expense.  

Other operation and maintenance expenses for the 1996 third quarter 
included a $6.1 million charge for an ongoing inventory reduction 
program.  The ongoing streamlining of the supply chain process includes 
a shift in management philosophy toward increased use of technology, 
consolidated warehousing and just-in-time purchase and delivery.  Other 
operation and maintenance expenses for the 1995 third quarter had 
included charges totaling $3.2 million for an inventory reduction and 
the recognition of costs associated with preliminary engineering 
studies.  Other cost-control measures helped to reduce third quarter 
1996 other operation and maintenance expenses below the third quarter 
1995 level, exclusive of the charges discussed above.
Third quarter 1996 nonoperating income decreased primarily because the 
deferral of carrying charges related to the Rate Stabilization Program 
ended in November 1995. 

Third quarter 1996 interest charges and preferred dividend requirements 
decreased because of the redemption of securities and refinancing at 
favorable terms.

Nine-month operating expenses in 1996 increased 7.5% from the 1995 
amount.  The cessation of the Rate Stabilization Program deferrals and 
the commencement of their amortization in December 1995 resulted in the 
decrease in deferred operating expenses.  Depreciation and amortization 
expenses increased for the same reasons cited for the third quarter 1996 
increase in these expenses.  Fuel and purchased power expenses increased 
as higher purchased  power expense was partially offset by lower fuel 
expense.  Other operation and maintenance expenses increased because of 
increases in nuclear power production expenses (attributable to 
refueling and maintenance outages, and the end of accelerated 
amortization of certain excess interim spent nuclear fuel storage costs 
under the Rate Stabilization Program), the third quarter 1996 inventory 
reduction charge, and expenses related to improvements in customer 
service and sales and marketing efforts.  Federal income taxes decreased 
as a result of lower pretax operating income.  

A nine-month 1996 nonoperating loss resulted primarily from the write-
down of two inactive production facilities as discussed in Note 7.  The 
deferral of carrying charges related to the Rate Stabilization Program 
ended in November 1995.  The nine-month 1996 federal income tax credit 
for nonoperating income increased accordingly.

Nine-month 1996 interest charges and preferred dividend requirements 
decreased because of the same reasons cited for the third quarter 1996 
decrease in these charges.



PART II.  OTHER INFORMATION

Item 5.  Other Information

1.	PUCO Rate Order

For background relating to this topic, see "Note 6 to the 
Financial Statements (Unaudited) -- (6) Regulatory Matters" in the 
First Quarter 1996 Form 10-Q and "Item 5.  Other Information.  5. 
PUCO Rate Order" in the Second Quarter 1996 Form 10-Q.

The City of Cleveland, the Office of the Ohio Consumers' Counsel, 
the Ohio Council of Retail Merchants, the Empowerment Center of 
Greater Cleveland, the City of Toledo, the Lucas County Board of 
Commissioners and Congresswoman Marcy Kaptur have filed appeals 
with the Ohio Supreme Court of the PUCO's April 11, 1996 rate 
order for the Operating Companies.  The Operating Companies have 
filed motions to dismiss the appeals filed by Congresswoman Kaptur 
and the Lucas County Board of Commissioners because neither was a 
party to the PUCO proceeding.   The appellants filed their merit 
briefs with the Ohio Supreme Court on November 4, 1996, and the 
Operating Companies expect to file their reply briefs with the 
Supreme Court by December 4, 1996. 

2.	PUCO Order on Request by City of Clyde

For background relating to this topic, see "Item 5.  Other Events. 

 2.  PUCO Order on Request by City of Clyde" in the Companies' 
combined Current Report on Form 8-K dated April 11, 1996; "Item 5. 
Other Information.  6.  PUCO Order on Request by City of Clyde" 
in the Second Quarter 1996 Form 10-Q; and "Item 5.  Other Events. 
2.  City of Clyde" in the Companies' combined Current Report on 
Form 8-K dated August 21, 1996 ("8/21/96 Form 8-K").

On August 28, 1996, the Ohio Supreme Court granted a Writ of 
Mandamus against the City of Clyde, Ohio, requiring the City to 
allow buildings which existed in the City prior to its February 
1995 Ordinance to receive electric service from Toledo Edison or 
from the City's electric company, at the option of the customer.  
On November 5, 1996, voters in the City of Clyde passed a 
referendum rescinding the Ordinance.

3.	Medical Center Co. -- FERC Petition

For background relating to this topic, see "Item 1.  Business--
Operations--Competitive Conditions--Cleveland Electric" in the 
1995 Form 10-K; "Item 5.  Other Information.  8.  Medical Center 
Co.--FERC Petition" in the Second Quarter 1996 Form 10-Q; and 
"Item 5.  Other Events.  3.  Medical Center" in the 8/21/96 Form 
8-K.

On July 31, 1996, the FERC ruled that Cleveland Electric is 
obligated to provide transmission service to Cleveland Public 
Power ("CPP").  This ruling enabled CPP to provide electric 
service to Medical Center Co. beginning in August 1996.  The FERC 
concluded that such transmission service by Cleveland Electric to 
CPP does not violate the Federal Power Act.  The FERC also 
dismissed Cleveland Electric's request for stranded cost recovery, 
without prejudice to its refiling and demonstrating that such 
request meets the criteria for seeking stranded cost recovery 
under FERC Order 888.  Cleveland Electric has sought rehearing of 
the FERC ruling and has agreed to provide the requested 
transmission service to CPP.  On September 18, 1996, the FERC 
granted rehearing for further consideration of the issues.


                               - 26 -



4.	City of Cleveland Lawsuit

For background relating to this topic, see "Item 5.  Other 
Information.  9.  City of Cleveland Lawsuit" in the Second Quarter 
1996 Form 10-Q.

On August 5, 1996, the City of Cleveland filed with the Court of 
Common Pleas of Cuyahoga County a complaint against Cleveland 
Electric seeking an order requiring Cleveland Electric to remove 
certain lamp posts, street lights and/or utility poles and 
assessing penalties for failure to take such action.  Cleveland 
Electric has filed a motion to dismiss the complaint for lack of 
jurisdiction, which motion is decisional.  

5.	Cost Reduction Efforts

For background relating to this topic, see "Item 5.  Other 
Information.  Cost Reduction Efforts" in the First Quarter 1996 
Form 10-Q.

On May 13, 1996, the Companies announced their intention to reduce 
the number of employees from 6,800 at January 1, 1996 to 6,300 by 
December 31, 1996.  At September 30, 1996, the Operating Companies 
and Centerior Service Company had 6,279 employees, with further 
reductions expected prior to year end.  The Companies also are 
decommissioning two older fossil-fueled generating units at the 
Acme Station in Toledo and the C-Plant in Ashtabula and reducing 
generating activities at three other plants.  These steps are part 
of an ongoing effort to reduce annual operating costs and are 
expected to result in annualized savings of at least $30 million.

Item 6.  Exhibits and Reports on Form 8-K

a.	Exhibits

	See Exhibit Index following.

b.	Reports on Form 8-K

During the quarter ended September 30, 1996, Centerior Energy, 
Cleveland Electric and Toledo Edison each filed two Current 
Reports on Form 8-K with the Securities and Exchange Commission.

A Form 8-K dated August 21, 1996 and filed on September 13, 1996 
included three items under "Item 5.  Other Events".  The first, 
"Management Changes", reported on the election of Lew W. Myers as 
Vice President - Nuclear--Perry.  The second, "2.  City of Clyde", 
reported on the status of Toledo Edison's litigation with the City 
of Clyde.  The third, "3.  Medical Center", reported on the status 
of proceedings against Ohio Power Company.

A Form 8-K dated September 13, 1996 and filed on September 17, 
1996 included one item under "Item 5.  Other Events".   That item, 
"Merger with Ohio Edison", reported on the merger agreement 
between Centerior Energy and Ohio Edison.






                                 - 27 -




                                Signatures


Pursuant to the requirements of the Securities Exchange Act of 1934, each 
registrant has duly caused this report to be signed on its behalf by the 
undersigned thereunto duly authorized.  The person signing this report on 
behalf of each such registrant is also signing in his capacity as each 
registrant's Chief Accounting Officer.


          
                                    CENTERIOR ENERGY CORPORATION
                                           (Registrant)



                                    THE CLEVELAND ELECTRIC 
                                       ILLUMINATING COMPANY	
                                           (Registrant)



                                    THE TOLEDO EDISON COMPANY
                                           (Registrant)











                               By:  E. LYLE PEPIN                       
                                    E. Lyle Pepin, Controller and Chief 
                                    Accounting Officer of each Registrant










Date: November 14, 1996  








                                         - 28 -



                                  EXHIBIT INDEX


The following exhibits are submitted herewith:

                             CENTERIOR ENERGY EXHIBIT

Exhibit Number               Description

27(a)                        Financial Data Schedule for the period ended
                             September 30, 1996.


                             CLEVELAND ELECTRIC EXHIBITS

Exhibit Number               Description

27(b)                        Financial Data Schedule for the period ended
                             September 30, 1996.


                             TOLEDO EDISON EXHIBITS

Exhibit Number               Description

27(c)                        Financial Data Schedule for the period ended  
                             September 30, 1996.






















                                     - 29 -