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                                                               Exhibit 99.01

      Louisville Gas and Electric Company Cautionary Factors

      The Private Securities Litigation Reform Act of 1995 provides a "safe
harbor" for forward-looking statements to encourage such disclosures without the
threat of litigation providing those statements are identified as
forward-looking and are accompanied by meaningful, cautionary statements
identifying important factors that could cause the actual results to differ
materially from those projected in the statement. Forward-looking statements
have been and will be made in written documents and oral presentations of
Louisville Gas and Electric Company (the "Company"). Such statements are based
on management's beliefs as well as assumptions made by and information currently
available to management. When used in the Company's documents or oral
presentations, the words "anticipate", "estimate", "expect", "objective" and
similar expressions are intended to identify forward-looking statements. In
addition to any assumptions and other factors referred to specifically in
connection with such forward-looking statements, factors that could cause the
Company's actual results to differ materially from those contemplated in any
forward-looking statements include, among others, the following:

*     Increased competition in the utility industry, including effects of:
      decreasing margins as a result of competitive pressures; industry
      restructuring initiatives; transmission system operation and/or
      administration initiatives; recovery of investments made under traditional
      regulation; nature of competitors entering the industry; retail wheeling;
      a new pricing structure; and former customers entering the generation
      market;

*     Changing market conditions and a variety of other factors associated with
      physical energy and financial trading activities including, but not
      limited to, price, basis, credit, liquidity, volatility, capacity,
      transmission, currency, interest rate and warranty risks;

*     Risks associated with price risk management strategies intended to
      mitigate exposure to adverse movement in the prices of electricity and
      natural gas on both a global and regional basis;

*     Economic conditions including inflation rates and monetary fluctuations;

*     Customer business conditions including demand for their products or
      services and supply of labor and materials used in creating their products
      and services;
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*     Financial or regulatory accounting principles or policies imposed by the
      Financial Accounting Standards Board, the Securities and Exchange
      Commission, the Federal Energy Regulatory Commission, state public utility
      commissions, state entities which regulate natural gas transmission,
      gathering and processing and similar entities with regulatory oversight;

*     Availability or cost of capital such as changes in: interest rates, market
      perceptions of the utility and energy-related industries, the Company or
      security ratings;

*     Factors affecting utility operations such as unusual weather conditions;
      catastrophic weather-related damage; unscheduled generation outages,
      unusual maintenance or repairs; unanticipated changes to fossil fuel, or
      gas supply costs or availability due to higher demand, shortages,
      transportation problems or other developments; environmental incidents; or
      electric transmission or gas pipeline system constraints; 

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

*     Rate-setting policies or procedures of regulatory entities, including
      environmental externalities;

*     Social attitudes regarding the utility, natural gas and power industries;

*     Costs and other effects of legal and administrative proceedings,
      settlements, investigations, claims and matters, including but not limited
      to those described in Note 13 of the Notes to Financial Statements of the
      Company's Annual Report on Form 10-K for the year ended December 31, 1996,
      under the caption Commitments and Contingencies;

*     Technological developments, changing markets and other factors that result
      in competitive disadvantages and create the potential for impairment of
      existing assets;

*     Other business or investment considerations that may be disclosed from
      time to time in the Company's Securities and Exchange Commission filings
      or in other publicly disseminated written documents.

The Company undertakes no obligation to publicly update or revise any
forward-looking statements, whether as a result of new information, future
events or otherwise.