CHUGACH ELECTRIC ASSOCIATION, INC.
                                      INDEX




                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549


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                                    FORM 10-Q

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         QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE
         SECURITIES EXHANGE ACT OF 1934


                  For the quarterly period ended June 30, 2001


                                       OR


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

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                         Commission file number 33-42125


                       CHUGACH ELECTRIC ASSOCIATION, INC.


                Incorporated pursuant to the Laws of Alaska State

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        Internal Revenue Service - Employer Identification No. 92-0014224

                    5601 Minnesota Drive, Anchorage, AK 99518
                                 (907) 563-7494

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

Indicate the number of shares outstanding of each of the issuer's class of
common stock, as of the latest practicable date.

                  CLASS                     OUTSTANDING AT AUGUST 1, 2001

                  NONE                                NONE

<PAGE>






                                                                     Page Number

CAUTION REGARDING FORWARD-LOOKING STATEMENTS                               3

PART I FINANCIAL INFORMATION

Item 1. Financial Statements (Unaudited)                                   3

        Balance Sheets, June 30, 2001 and December 31, 2000                4

        Statements of Revenues, Expenses and Patronage Capital, Three and
        Six Months Ended June 30, 2001 and 2000                            6

        Statements of Cash Flows, Six Months Ended June 30, 2001 and 2000  7

        Notes to Financial Statements                                      8

Item 2. Management's Discussion and Analysis of Results of Operations
        and Financial Condition                                          1 0

Item 3. Quantitative and Qualitative Disclosures About Market Risk       1 6

PART II OTHER INFORMATION

Item 1. Legal Proceedings                                                1 8

Item 2. Changes in Securities and Use of Proceeds                        1 8

Item 3. Defaults Upon Senior Securities                                  1 9

Item 4. Submission of Matters to a Vote of Security Holders              1 9

Item 5. Other Information                                                1 9

Item 6. Exhibits and reports on Form 8-K                                 1 9

        Signatures                                                       2 0

        Exhibits                                                         2 1



<PAGE>


     CAUTION REGARDING FORWARD-LOOKING STATEMENTS

     Statements in this report that do not relate to historical facts, including
     statements relating to future plans, events or performance, are
     forward-looking statements that involve risks and uncertainties. Actual
     results, events or performance may differ materially. Readers are cautioned
     not to place undue reliance on these forward-looking statements, that speak
     only as of the date of this report and the accuracy of which is subject to
     inherent uncertainty. Chugach Electric Association, Inc. (Chugach or the
     Association) undertakes no obligation to publicly release any revisions to
     these forward-looking statements to reflect events or circumstances that
     may occur after the date of this report or the effect of those events or
     circumstances on any of the forward-looking statements contained in this
     report, except as required by law.

                          PART I FINANCIAL INFORMATION

     Item 1.  Financial Statements

     The unaudited financial statements of Chugach for the quarter ended June
     30, 2001 follow:

<PAGE>





                       CHUGACH ELECTRIC ASSOCIATION, INC.
                                 BALANCE SHEETS
                                   (Unaudited)



                             Assets
                             ------
<TABLE>
<CAPTION>
<S>                                                                          <C>                     <C>

                                                                             June 30, 2001           December 31, 2000
                                                                             -------------           -----------------
Utility plant

     Electric plant in service                                               $ 704,064,948             $ 687,127,130

     Construction work in progress                                              30,209,136                42,027,617
                                                                                ----------                ----------
                                                                               734,274,084               729,154,747

     Less accumulated depreciation                                           (255,965,252)             (259,999,872)
                                                                             -------------             -------------

         Net utility plant                                                     478,308,832               469,154,875
                                                                               -----------               -----------

Other property and investments, at cost:

     Nonutility property                                                             3,550                   443,555

     Investments in associated organizations                                     9,927,076                 9,857,153
                                                                                 ---------                 ---------
                                                                                 9,930,626                10,300,708
                                                                                 ---------                ----------

Current assets:

     Cash and cash equivalents                                                   5,901,724                 1,695,162

     Cash-restricted construction funds                                            436,244                   378,848

     Special deposits                                                              212,164                   212,163

     Accounts receivable, net                                                   17,367,431                19,200,912

     Fuel cost recovery                                                          4,105,825                 2,915,733

     Materials and supplies                                                     15,513,856                15,357,198

     Prepayments                                                                 1,303,069                   755,276

     Other current assets                                                          217,873                   332,246
                                                                                   -------                   -------

         Total current assets                                                   45,058,186                40,847,538
                                                                                ----------                ----------

Deferred charges                                                                26,081,601                19,442,859
                                                                                ----------                ----------
                                                                             $ 559,379,245             $ 539,745,980
                                                                             =============             =============
<FN>
See accompanying notes to financial statements.
</FN>
</TABLE>


<PAGE>



                    Liabilities and Equities
                    ------------------------
<TABLE>
<CAPTION>
<S>                                                                           <C>                     <C>

                                                                              June 30, 2001           December 31, 2000
                                                                              -------------           -----------------
Equities and margins:

     Memberships                                                               $ 1,032,223               $ 1,009,663

     Patronage capital                                                         125,743,981               122,925,253

     Other                                                                       4,795,476                 4,880,424
                                                                                 ---------                 ---------
                                                                               131,571,680               128,815,340
                                                                               -----------               -----------

Long-term obligations, excluding current Installments:

     2001 Series A bonds payable                                               150,000,000                         0

     First Mortgage bonds payable                                              154,310,000               169,542,000

     National Bank for Cooperatives bonds payable                               65,000,000               142,677,945
                                                                                ----------               -----------
                                                                               369,310,000               312,219,945
                                                                               -----------               -----------

Current liabilities:

     Short-term borrowings                                                               0                40,000,000

     Current installments of long-term debt                                     10,580,267                 6,430,350

     Accounts payable                                                            3,595,248                 9,493,875

     Consumer deposits                                                           1,450,685                 1,324,213

     Accrued interest                                                            6,603,796                 5,861,390

     Salaries, wages and benefits                                                4,518,002                 4,586,407

     Fuel                                                                        7,186,099                 8,154,559

     Estimated settlement of rate lock agreement                                 3,431,384                         0

     Other current liabilities                                                     943,764                 1,434,562
                                                                                   -------                 ---------

         Total current liabilities                                              38,309,245                77,285,356
                                                                                ----------                ----------

     Deferred credits                                                           20,188,320                21,425,339
                                                                                ----------                ----------
                                                                             $ 559,379,245             $ 539,745,980
                                                                             =============             =============
<FN>
See accompanying notes to financial statements.
</FN>
</TABLE>

<PAGE>


                       CHUGACH ELECTRIC ASSOCIATION, INC.
             Statements of Revenues, Expenses and Patronage Capital
                                   (Unaudited)
<TABLE>
<CAPTION>
<S>                                                        <C>               <C>                 <C>                <C>



                                                                 Three months ended June 30 Six months ended June 30

                                                                 2001               2000              2001               2000
                                                                 ----               ----              ----               ----

Operating revenues                                          $ 39,018,695      $ 36,185,683       $ 84,214,272       $ 77,056,757

Operating expenses:
     Power production                                         15,132,787        11,752,363         32,677,221         23,366,379

     Purchased power                                           2,153,516         2,188,159          3,971,251          4,615,439

     Transmission                                                805,511           571,900          1,870,933          1,541,635

     Distribution                                              2,435,425         2,088,968          4,775,595          4,946,410

     Consumer accounts/Information expense                     1,293,400         1,461,881          2,618,258          2,748,636

     Sales expense                                                90,541           252,090            221,105            527,850

     Administrative, general and other                         4,636,545         5,188,626          9,721,309          9,707,742

     Depreciation and amortization                             6,240,878         5,679,268         12,305,476         11,432,620
                                                               ---------         ---------         ----------         ----------
         Total operating expenses                             32,788,603        29,183,255         68,161,148         58,886,711
                                                              ----------        ----------         ----------         ----------

Interest:
     On long-term obligations                                  6,924,727         6,201,277         13,087,314         12,710,982

     On short-term obligations                                   186,557           472,679          1,091,787            533,539

     Charged to construction-credit                             (73,474)         (559,485)          (450,620)          (989,189)
                                                                --------         ---------          ---------          ---------
         Net interest expense                                  7,037,810         6,114,471         13,728,481         12,255,332
                                                               ---------         ---------         ----------         ----------
         Net operating margins                                 (807,718)           887,957          2,324,643          5,914,714
                                                               ---------           -------          ---------          ---------

Nonoperating margins:
     Interest income                                             226,608           191,181            380,182            390,018

     Other                                                       (3,989)            68,993            231,105            226,492
                                                                 -------            ------            -------            -------
         Total nonoperating margins                              222,619           267,174            611,287            616,510
                                                                 -------           -------            -------            -------
         Assignable margins                                    (585,099)         1,155,131          2,935,930          6,531,224
                                                               =========         =========          =========          =========

Patronage capital at beginning of period                     126,376,024       122,653,143        122,925,253        117,335,481
                                                             -----------       -----------        -----------        -----------

Retirement of capital credits and estate payments
                                                                (46,944)          (81,396)          (117,202)          (139,827)
                                                                --------          --------          ---------          ---------

Patronage capital at end of period                         $ 125,743,981     $ 123,726,878      $ 125,743,981      $ 123,726,878
                                                           =============     =============      =============      =============
<FN>
See accompanying notes to financial statements.
</FN>
</TABLE>


<PAGE>

                     CHUGACH ELECTRIC ASSOCIATION, INC.
                         Statement of Cash Flows
                               (Unaudited)
<TABLE>
<CAPTION>
<S>                                                                                       <C>              <C>

                                                                                           Six-months ended June 30
                                                                                             2001            2000
                                                                                             ----            ----
Cash flows from operating activities:

Assignable margins                                                                        $ 2,935,930      $ 6,531,224
                                                                                          ------------     -----------

Adjustments to reconcile assignable margins to net cash provided (used) by
operating activities:

     Depreciation and amortization                                                          12,305,476      11,432,620

     Changes in assets and liabilities:
     (Increase) decrease in assets:

     Fuel cost recovery                                                                    (1,190,092)       1,647,793
     Accounts receivable                                                                     1,833,481       5,232,729
     Prepayments                                                                             (547,793)       (183,210)
     Materials and supplies                                                                  (156,658)         114,407
     Deferred charges                                                                      (3,207,358)         263,816
     Other                                                                                     496,981          58,009

     Increase (decrease) in liabilities:
     Accounts payable                                                                      (5,898,627)     (4,179,339)
     Consumer deposits                                                                         126,472          47,310
     Accrued interest                                                                          742,406       (437,758)
         Deferred credits                                                                  (1,237,019)     (2,826,214)
     Other                                                                                 (1,527,663)         259,024
                                                                                           -----------         -------
         Net cash provided by operating activities                                           4,675,536      16,312,618
                                                                                             ---------      ----------

Cash flows from investing activities:

     Extension and replacement of plant                                                   (21,459,433)    (18,749,700)
     Investments in associated organizations                                                  (69,923)        (38,707)
                                                                                              --------       --------
         Net cash used in investing activities                                            (21,529,356)    (18,788,407)
                                                                                          ------------    ------------

Cash flows from financing activities:

     Short-term borrowings, net                                                           (40,000,000)      26,000,000
     Proceeds from long-term debt                                                          150,000,000               0
     Repayments of long-term obligations                                                  (88,760,028)    (24,716,361)
     Retirement of patronage capital                                                         (117,202)       (139,827)
     Other                                                                                    (62,388)          38,554
                                                                                              --------          ------
         Net cash provided by financing activities                                          21,060,382       1,182,366
                                                                                            ----------       ---------

         Net increase in cash and cash equivalents                                           4,206,562     (1,293,423)

Cash and cash equivalents at beginning of period                                           $ 1,695,162     $ 4,110,030
------------------------------------------------                                           -----------     -----------

Cash and cash equivalents at end of period                                                 $ 5,901,724     $ 2,816,607
------------------------------------------                                                 ===========     ===========

Supplemental disclosure of cash flow information - interest expense paid, net of           $12,986,075     $12,693,090
                                                                                           ===========     ===========
amounts capitalized

Non-Cash Transaction - Estimated settlement of rate lock agreement                          $3,431,384              $0

                                                                                            ==========              ==
<FN>
See accompanying notes to financial statements.
</FN>
</TABLE>

<PAGE>



                      CHUGACH ELECTRIC ASSOCIATION, INC.

                        Notes to Financial Statements
                                (Unaudited)

     1.  Presentation of Financial Information

     During interim periods, Chugach follows the accounting policies set forth
     in its audited financial statements included in Form 10-K filed with the
     Securities and Exchange Commission, unless otherwise noted. Users of
     interim financial information are encouraged to refer to the footnotes
     contained in Chugach's Form 10-K when reviewing interim financial results.
     The accompanying unaudited interim financial statements reflect all
     adjustments, which are, in the opinion of management necessary to a fair
     statement of the results for the interim periods presented.

     Certain reclassifications have been made to the 2000 financial statements
     to conform to the 2001 presentation.

     2.  Refinancing

     2001 Series A Bonds

     On April 17, 2001, Chugach issued $150,000,000 of 2001 Series A Bonds, for
     the purpose of retiring indebtedness outstanding under existing lines of
     credit and outstanding bonds, for capital expenditures and for general
     working capital. The lines of credit had an aggregate outstanding principal
     balance of $55,000,000, as of April 17, 2001, are renewable annually and
     bore interest at variable annual rates ranging from 7.55% to 7.80% at April
     17, 2001. The variable-rate bonds retired had an aggregate outstanding
     principal balance of $72,500,000, as of April 17, 2001, would have matured
     in 2002 and bore interest at a variable rate that was 7.55% on April 17,
     2001.

     The 2001 Series A Bonds will mature on March 15, 2011, and bear interest at
     6.55% per annum. Interest will be paid semi-annually on March 15 and
     September 15 of each year commencing with September 15, 2001. The 2001
     Series A Bonds are secured by a first lien on substantially all of
     Chugach's assets. The first lien will be automatically released when all
     bonds issued by Chugach prior to April 1, 2001, cease to be outstanding or
     their holders consent to conversion to unsecured status. Thereafter, the
     2001 Series A Bonds will be unsecured obligations, ranking equally with
     Chugach's other unsecured and unsubordinated obligations.

     1991 Series A Bonds

     In May 2001, Chugach reacquired $10,000,000 of its Series A 2022 Bonds at a
     price of 111%. Total transaction cost, including accrued interest and
     premium, was $11,242,178. The premium paid will be reflected as a
     regulatory asset and amortized over the life of the 2001 Series A Bonds.

     3.  Lines of Credit

     Chugach maintains a line of credit of $35 million with CoBank, ACB,
     (CoBank). The CoBank line of credit expires August 1, 2002, but is subject
     to annual renewal. At June 30, 2001, there was no outstanding balance on
     this line of credit. In addition, the Association has an annual line of
     credit of $50 million available at the National Rural Utilities Cooperative
     Finance Corporation (NRUCFC). At June 30, 2001, there was no outstanding
     balance on this line of credit. The NRUCFC line of credit expires October
     14, 2002, but is subject to annual renewal.

     4.  Changes in Accounting Principles

     Chugach entered into a US Treasury Rate Lock Agreement consisting of
     notional amount of $196.0 million 10-year and $18.7 million 30-year U.S.
     Treasuries on March 17, 1999, with Lehman Brothers Financial Products, Inc.
     (Lehman) for the purpose of taking advantage of favorable interest rates in
     anticipation of the probable refinancing of our 1991 Series A Bonds due
     2022 on their first call date of March 15, 2002. On May 11, 2001, Chugach
     terminated the $18.7 million U.S. Treasury portion of the U.S. Treasury
     Rate Lock Agreement in receipt of payment of $10,000 by Lehman. The Series
     A bonds are callable at a 9.14% premium. As of June 30, 2001, the aggregate
     principal amount of the Series A Bonds was $154,310,000.

     Under the US Treasury Rate Lock Agreement, we will receive a lump-sum
     payment on March 15, 2002, if the yield on 10-year Treasury bonds as of
     mid-February 2002, exceeds a specified target level (5.653%.) Conversely,
     on the same date, we will be required to make a payment if the yield on the
     10-year Treasury bond falls below the target yields.

     Chugach adopted SFAS No. 133, Accounting for Derivative Instruments and
     Hedging Activities, as amended by SFAS No. 138, effective January 1, 2001.
     This new standard requires all derivative financial instruments to be
     reflected on the balance sheet. As of June 30, 2001, we have established a
     regulatory asset of $3.4 million and a liability for the same amount. The
     regulatory asset and liability will be adjusted for changes in the
     estimated value of the US Treasury Rate Lock Agreement entered into by us.
     Management believes it is probable the regulatory asset will be recovered
     through rates.

     5.  Environmental Matters

     Chugach discovered polychlorinated biphenyls (PCBs) in paint, caulk and
     grease at the Cooper Lake Hydroelectric Plant during initial phases of a
     turbine overhaul. An Environmental Protection Agency (EPA) approved plan
     was implemented to remediate the PCBs in the plant. As a condition of its
     approval of the license amendment for the overhaul project, the Federal
     Energy Regulatory Commission (FERC) required Chugach to also investigate
     the presence of PCBs in Kenai Lake. A sampling plan was developed by
     Chugach in consultation with various agencies and approved by FERC. In 2000
     Chugach sampled sediments and fish collected from Kenai Lake and other
     waters. While extremely low levels of PCBs were found in some sediment
     samples taken near the plant, no pathway from sediment to fish was
     established. Additional sediment sampling and analysis in this area is
     being performed. While the presence of PCBs in fish did not reveal amounts
     above background levels, Chugach is conducting additional sampling and
     analysis of fish in Kenai Lake and other waters. A report will be provided
     to FERC on the results of the additional fish and sediment sampling by
     December 31, 2001. Management believes the costs of this work will be
     recoverable through rates and therefore will have no material impact on the
     financial condition or results of operations.

     6.  Legal Proceedings

     On July 7, 1999, Matanuska Electric Association, Inc., (MEA) filed a
     complaint against Chugach asserting that Chugach violated the parties'
     Power Supply Agreement in several different ways. Chugach and MEA have each
     filed various motions in the case. While a trial date has not yet been set,
     the parties seek a trial in February 2002. We are not able to estimate the
     costs of our participation. This case is described in greater detail under
     Part II, Other Information, Item 1 Legal Proceedings, Matanuska Electric
     Association, Inc. v. Chugach Electric Association, Inc. 3AN-99-8152
     (Omnibus case).

     Item 2.  Management's Discussion and Analysis of Financial Condition and
     Results of Operations

     Reference is made to the information contained under the caption "CAUTION
     REGARDING FORWARD-LOOKING STATEMENTS" at the beginning of this Report.

     For certain information concerning a U.S. Treasury Rate Lock transaction
     entered into by Chugach in March 1999, reference is made to information
     appearing in Part I, Item 3 "Quantitative and Qualitative Disclosures about
     Market Risk - Interest Rate Risk." of this Report.

     RESULTS OF OPERATIONS

     Current Year Quarter Versus Prior Year Quarter

     In general, net margins decreased due to a $923 thousand, or 15%, increase
     in net interest expense, a $562 thousand, or 10% increase in depreciation
     expense and the remaining is due to a decline in kilowatt hour sales due to
     warmer weather.

     Operating revenues, which include sales of electric energy to retail,
     wholesale and economy energy customers and other miscellaneous revenues,
     increased by $2.8 million, or 8.0%, for the quarter ended June 30, 2001,
     over the same quarter in 2000. This increase was due to increased fuel
     prices, resulting in increased revenue collected through the fuel surcharge
     mechanism. Economy energy sales were lower due to decreased sales to Golden
     Valley Electric Association (GVEA). Increased fuel prices have made it more
     economical for GVEA to produce their own power rather than purchase from
     Chugach.

     Retail demand and energy rates did not change in the second quarter of 2001
     compared to the second quarter of 2000. Over this same period, the
     wholesale demand and energy rates charged to Homer Electric Association,
     Inc. (HEA) and Matanuska Electric Association, Inc. (MEA) decreased by 0.7
     percent and 0.8 percent, respectively. Wholesale demand and energy rates
     charged to Seward Electric System (SES) did not change this quarter
     compared to the same quarter last year.

     In February 2001, Chugach submitted a request with the Regulatory
     Commission of Alaska (RCA) to extend the power sales agreement between
     Chugach and the City of Seward, scheduled to terminate September 1, 2001,
     to January 31, 2006. The RCA conditionally approved the extension in April
     2001. Final regulatory approval of the Agreement was gained on June 7,
     2001.

     In April 2001 Chugach received final regulatory approval of its 1997
     revenue requirement filing, which indicated that no rate refunds were
     required.

     Chugach submitted its 1998 test year revenue requirement filing to the
     Regulatory Commission of Alaska in February 2001. A hearing to resolve the
     outstanding issues associated with the filing is scheduled for September
     2001. Management believes the resolution of the remaining issues will not
     have a material effect on Chugach.

     Chugach submitted a general rate case based on the 2000 test year to the
     Regulatory Commission of Alaska on July 10, 2001. The filing requests base
     rate increases of 4.0 percent on an interim basis and 6.5 percent on a
     permanent basis. Chugach has requested that the interim base rate increase
     become effective for billings rendered during September 2001. If approved,
     the 4.0 percent increase will result in approximately $1.6 million in
     additional revenue in 2001 or $4.7 million on an annualized basis. The
     interim rate increase proposal is based on a normalized test year and a
     system ratemaking Times Interest Earned Ratio (TIER) of 1.35.

     Chugach requested a permanent system base rate increase of 6.5 percent,
     which Chugach anticipates becoming effective during 2002. In contrast to
     Chugach's traditional TIER-based approach to establishing rates, which was
     used to establish the 4.0 percent interim rate increase, Chugach's
     permanent base rate increase was established on the basis of return on rate
     base. The permanent rate increase for electric operations is based on a
     return of 7.0 percent, or $28.3 million in interest expense and $10.8
     million in margins. The interest and margin requirements yield an
     equivalent system TIER of 1.44.

     If approved, the 6.5 percent permanent base rate increase will result in
     $7.5 million in annualized revenue, or approximately $2.8 million above the
     annualized interim increase.

     Power production expense increased by $3.4 million, or 29%, from the second
     quarter 2000 to second quarter 2001 due to an increase in fuel prices.
     Purchased power expense decreased by $35 thousand, or 2%, for the quarter
     ended June 30, 2001, compared to the same period in 2000 due to the Nikiski
     power plant being offline until June 2001. Transmission and Distribution
     expense increased by $234 thousand, or 41% and $346 thousand, or 17%,
     respectively, in this period compared to the same period last year, due to
     Federal Emergency Management Agency (FEMA) proceeds received in the second
     quarter 2000 for avalanche damage in the first quarter of 2000. Consumer
     Accounts and Information expense, Sales expense and Administrative, general
     and other expense decreased respectively by $168 thousand, or 12%, $162
     thousand, or 64% and $552 thousand, or 11% from the second quarter 2000 to
     the second quarter 2001 all due to the sale of the ISP business venture in
     March 2001. Depreciation expense increased by $562 thousand, or 10%, due to
     project close-outs in the second quarter of 2001, compared to the second
     quarter of 2000.

     Interest on long-term debt increased by $723 thousand or 12%, due to the
     $150 million of lower interest rate 2001 Series A Bonds issued in the
     second quarter of 2001. Interest charged to construction saw a decrease of
     $486 thousand, or 87% in the second quarter of 2001 compared to the same
     period in 2000 due to lower construction work in progress balances during
     the second quarter. Other interest expense decreased by $286 thousand or
     61%, due to lower outstanding balances on the lines of credit in the second
     quarter of 2001.

     Other nonoperating margins were lower for the quarter ended June 30, 2001,
     compared to the same period in 2000 due to the decrease in Allowance for
     Funds Used During Construction (AFUDC) during the second quarter due to
     lower Construction Work in Progress (CWIP) balances in 2001. This was
     offset by higher inventory write-offs in the second quarter of 2000
     compared to the same quarter in 2001.

     Current Year to Date Versus Prior Year to Date

     In general, net margins decreased due to a $1.5 million, or 12%, increase
     in net interest expense, an $873 thousand, or 8% increase in depreciation
     expense and the remaining is due to a decline in kilowatt hour sales due to
     warmer weather.

     Operating revenues increased by $7.2 million, or 9%, for six months ended
     June 30, 2001, over the same period in 2000. The increase was due to
     increased fuel prices, resulting in increased revenue collected through the
     fuel surcharge mechanism. Economy energy sales were lower due to decreased
     sales to GVEA.

     Power production increased by $9.3 million, or 40%, in the first six months
     of 2001, compared to the same period in 2000 due to higher fuel costs.
     Purchased power expense decreased by $644 thousand, or 14%, because we made
     no purchases from the Soldotna Unit #1 because it was offline while it was
     moved to Nikiski. Transmission expense increased by $329 thousand, or 21%,
     due to increased line clearing as a result of Spruce Bark Beetle killed
     trees. Sales expense decreased by $307 thousand, 58%, due to the sale of
     the Internet business in March 2001. Depreciation expense increased by $873
     thousand, or 8%, due to the close-out of $65 million of CWIP in late 2000.
     Net interest increased by $1.5 million, or 12%, due to the transactions
     associated with the 2001 Series A Bonds issued in April 2001.



<PAGE>


     Financial Condition

     Total assets increased by $19.6 million, or 4%, from December 31, 2000, to
     June 30, 2001. This increase was due to a $6.6 million, or 34%, increase in
     deferred charges, attributed in part to the recording of the estimated
     regulatory asset associated with the liability established for the rate
     lock agreement and the financing charges associated with the $150 million
     public bond offering in April 2001. There was a $9.2 million, or 2%,
     increase in net utility plant caused by the completion of several projects,
     including the Cooper Lake overhaul, the Supervisory Control and Data
     Acquisition (SCADA) upgrade, and the International Generating Terminal
     (IGT) auxiliaries improvement, as well as miscellaneous distribution
     projects. This, however, was offset by the retirement of assets related to
     Beluga Unit #6 and Unit #7, as well as assets retired from Cooper Lake.
     There was also a $4.2 million increase to cash and cash equivalents. This
     was associated with funds received from the public bond offering in April
     2001, which left a higher balance at June 30, 2001. There was a $1.2
     million, or 41%, increase in fuel cost recovery due to higher than
     anticipated fuel prices, as well as lower output from Bradley Lake. These
     increases were partially offset by a $1.8 million, or 10%, decrease in
     accounts receivable caused by the payment of wholesale power bills that
     were accrued but not paid at December 31, 2000. Notable changes to total
     liabilities include the $3.4 million recording of the estimated settlement
     value of the rate lock agreement, in compliance with FASB 133. There were
     several variances associated with the public bond offering in April 2001.
     These included a $742 thousand, or 13%, increase in accrued interest, as
     well as an increase of $57.1 million, or 18%, in long-term obligations,
     offset, however, by the reacquired bonds in May 2001. There was also an
     increase of $4.1 million, or 65%, in current installments of long-term debt
     due to the first installment of CoBank 5 due in June of 2002. This was
     offset by the decrease of $40 million in short-term borrowings, which was
     also associated with the public bond offering in April 2001. There was also
     a decrease of $5.9 million in accounts payable due to the payment of
     year-end accruals.

     Liquidity and Capital Resources

     Chugach has satisfied its operational and capital cash requirements
     primarily through internally generated funds, an annual $50 million line of
     credit from NRUCFC and a $35 million line of credit with CoBank. At June
     30, 2001, there was no outstanding balance with NRUCFC or CoBank.


<PAGE>


     Chugach has negotiated a supplemental indenture (Seventh Supplemental
     Indenture of Trust) that eliminated the maximum aggregate amounts of bonds
     the Association may issue under the agreement. At June 30, 2001, Chugach
     had the following bonds outstanding under this financing arrangement.
<TABLE>
<CAPTION>
<S>     <C>                    <C>                       <C>                     <C>                 <C>

                                                 Interest rate at June                            Principal Payment
          Bond              Principal balance           30, 2001             Maturity Date              Dates


        CoBank 1                  $348,267               8.95%                   2002                2001 - 2002
        CoBank 2               $10,000,000               7.76%                   2005                   2005
        CoBank 3               $21,500,000               5.60%                   2022                2003 - 2022
        CoBank 4               $23,500,000               5.60%                   2022                2003 - 2022
        CoBank 5               $15,000,000               5.60%                   2012                2002 - 2012

         Total                 $70,348,267
</TABLE>

     Additionally, Chugach has negotiated a similar supplemental indenture
     (Fifth Supplemental Indenture of Trust) with NRUCFC for $80 million. At
     June 30, 2001 there was no amount outstanding under this financing
     arrangement.

     Capital construction in 2001 is estimated at $36.3 million. At June 30,
     2001, approximately $21.5 million had been expended. Capital improvement
     expenditures are expected to increase in the upcoming third quarter as the
     construction season began in April and extends into October.

     On April 17, 2001, Chugach issued $150,000,000 of 2001 Series A Bonds, for
     the purpose of retiring indebtedness outstanding under existing lines of
     credit and outstanding bonds, for capital expenditures and for general
     working capital. The lines of credit had an aggregate outstanding principal
     balance of $55,000,000, as of April 17, 2001, are renewable annually and
     bore interest at variable annual rates ranging from 7.55% to 7.80% at April
     17, 2001. The variable-rate bonds retired had an aggregate outstanding
     principal balance of $72,500,000, as of April 17, 2001, would have matured
     in 2002 and bore interest at a variable rate that was 7.55% on April 17,
     2001.

     The 2001 Series A Bonds will mature on March 15, 2011, and bear interest at
     6.55% per annum. Interest will be paid semi-annually on March 15 and
     September 15 of each year commencing with September 15, 2001. The 2001
     Series A Bonds are secured by a first lien on substantially all of
     Chugach's assets. The first lien will be automatically released when all
     bonds issued by Chugach prior to April 1, 2001, cease to be outstanding or
     their holders consent to conversion to unsecured status. Thereafter, the
     2001 Series A Bonds will be unsecured obligations, ranking equally with
     Chugach's other unsecured and unsubordinated obligations.

     Chugach is a party to a U.S. Treasury Rate Lock Agreement with respect to
     the probable refinancing of a portion of the 1991 Series A Bonds. The
     settlement date of this contract is March 15, 2002. At June 30, 2001, the
     U.S. Treasury Rate Lock Agreement had an estimated value of $(3,431,384).
     At August 13, 2001, the agreement had an estimated value of $(8,721,384).
     On May 11, 2001, Chugach terminated a portion of the agreement in receipt
     of payment of $10,000. See Item 3 "Quantitative and Qualitative Disclosures
     about Market Risk - Interest Rate Risk."

     Chugach management continues to expect that cash flows from operations and
     external funding sources will be sufficient to cover operational and
     capital funding requirements in 2001 and thereafter.

     Changes in Accounting Principles

     In July 2001, the Financial Accounting Standards Board issued Statement No.
     141, Business Combinations, and Statement No. 142, Goodwill and Other
     Intangible Assets. Statement 141 requires that the purchase method of
     accounting be used for all business combinations initiated or completed
     after June 30, 2001. Statement 142 will require that goodwill and
     intangible assets with indefinite useful lives no longer be amortized, but
     instead tested for impairment at least annually. The provisions of
     Statement 142 are required to be applied starting with fiscal years
     beginning after December 15, 2001. Chugach believes the adoption of
     Statement 141 and 142 will have no impact on Chugach's financial
     statements.

     OUTLOOK

     Electric industry deregulation has suffered a major setback with the
     industry deterioration in California. The competitive marketplace in Alaska
     now seems quite distant and there is no movement in that direction.

     In the recent past Chugach has been active at the Alaska Legislature in
     support of the customer's right to choose their electric power provider.
     Virtually all Alaska utilities opposed Chugach's efforts to develop
     competition and no movement in that direction currently exists.

     To insure readiness for competition and to build organizational experience
     and expertise in competitive-type business, Chugach operates with three
     divisions: Finance and Energy Supply, Transmission and Distribution Network
     Services and Retail Services. Chugach also operates a key account program
     for larger customers and has developed several new services to enhance
     existing customer satisfaction.

     ENVIRONMENTAL MATTERS

     Compliance with Environmental Standards

     Chugach's operations are subject to certain federal, state and local
     environmental laws that Chugach monitors to ensure compliance. The costs
     associated with environmental compliance are included as a component of
     both the operating and capital budget processes. Chugach accrues for costs
     associated with environmental remediation obligations when such costs are
     probable and reasonably estimable.

     Environmental Matters

     Chugach discovered polychlorinated biphenyls ("PCBs) in paint, caulk and
     grease at the Cooper Lake Hydroelectric Plant during initial phases of a
     turbine overhaul. An Environmental Protection Agency (EPA) approved plan
     was implemented to remediate the PCBs in the plant. As a condition of its
     approval of the license amendment for the overhaul project, the FERC
     required Chugach to also investigate the presence of PCBs in Kenai Lake. A
     sampling plan was developed by Chugach in consultation with various
     agencies and approved by FERC. In 2000 Chugach sampled sediments and fish
     collected from Kenai Lake and other waters. While extremely low levels of
     PCBs were found in some sediment samples taken near the plant, no pathway
     from sediment to fish was established. Additional sediment sampling and
     analysis in this area is being performed. While the presence of PCBs in
     fish did not reveal amounts above background levels, Chugach is conducting
     additional sampling and analysis of fish in Kenai Lake and other waters. A
     report will be provided to FERC on the results of the additional fish and
     sediment sampling by December 31, 2001. Management believes the costs of
     this work will be recoverable through rates and therefore will have no
     material impact on the financial condition or results of operations.

     Item 3. Quantitative and Qualitative Disclosures About Market Risk

     Chugach is exposed to a variety of risks, including changes in interest
     rates and changes in commodity prices due to repricing mechanisms inherent
     in gas supply contracts. In the normal course of our business, Chugach
     manages its exposure to these risks as described below. Chugach does not
     engage in trading market risk-sensitive instruments for speculative
     purposes.

     Interest Rate Risk

     As of June 30, 2001, all of our outstanding long-term borrowings were at
     fixed interest rates with varying maturity dates. The following table
     provides information regarding cash flows for principal payments on total
     debt by maturity date (dollars in thousands) as of June 30, 2001.

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

                                                                                                        Fair
                         2001       2002       2003     2004       2005      Thereafter     Total       Value
Total Debt*              ----       ----       ----     ----       ----      ----------     -----       -----


Fixed rate                 $170    $10,410    $5,907   $6,447     $17,036      $339,920    $379,890    $393,944


Average
interest rate             8.95%      6.90%     8.62%    8.62%       8.12%         7.50%       7.55%
<FN>
     *   Includes current portion
</FN>
</TABLE>

     On March 17, 1999, Chugach entered into a U.S. Treasury Rate Lock
     Agreement, consisting of notional amount of $196 million 10-year and of
     $18.7 million 30-year U.S. Treasuries, with Lehman Brothers Financial
     Products, Inc. (Lehman) for the purpose of taking advantage of favorable
     market interest rates in anticipation of refinancing Chugach's Series A
     Bonds Due 2022 on their first call date (March 15, 2002). As of June 30,
     2001, the aggregate principal amount of Series A Bonds due 2022 was
     $154,310,000. On May 11, 2001, Chugach terminated the $18.7 million U.S.
     Treasury portion of the U.S. Treasury Rate Lock Agreement in receipt of
     payment of $10,000 by Lehman Brothers. Under the Treasury rate lock
     contract, Chugach will receive a lump-sum payment from Lehman Brothers on
     March 15, 2002, if the yield on 10-year Treasury bonds as of mid-February,
     2002, exceeds a specified target level (5.653%). Conversely, on the same
     date, Chugach will be required to make a payment to Lehman Brothers if the
     yield on the 10-year Treasury bonds falls below its stated target yield.
     The fair value of the treasury rate lock agreement on August 13, 2001,
     approximated $(8.7) million. A 10 basis-point change (up or down) in the
     prevailing yield on 10-year Treasury bonds would change the value of the
     rate lock agreement (up or down) by approximately $1.4 million.

     Commodity Price Risk

     Chugach's gas contracts provide for adjustments to gas prices based on
     fluctuations of certain commodity prices and indices. Because purchased
     power costs are passed directly to our wholesale and retail customers
     through a fuel surcharge, fluctuations in the price paid for gas pursuant
     to long-term gas supply contracts do not normally impact margins. The fuel
     surcharge mechanism mitigates the commodity price risk related to market
     fluctuations in the price of purchased power.



<PAGE>


                             PART II OTHER INFORMATION

     Item 1. Legal Proceedings

     Matanuska Electric Association, Inc. v. Chugach Electric Association, Inc.
     3AN-99-8152 (Omnibus case)

     On July 7, 1999, Matanuska Electric Association, Inc., (MEA) filed a
     complaint against Chugach Electric Association, Inc., (Chugach) in Alaska
     Superior Court in Anchorage, asserting that Chugach violated the parties'
     Power Supply Agreement, (Agreement) in failing to provide MEA with
     information about several different matters that MEA asserts could affect
     the cost of the power MEA purchases from Chugach. MEA also asserted that
     Chugach violated the Agreement in the management of its long-term bond
     indebtedness, violated Alaska statutes and Chugach's bylaws in the manner
     in which it conducted a special meeting in 1999 and violated the Agreement
     in failing to follow a certain procedure prior to filing its 2000 test-year
     general rate case.

     Chugach has filed several motions for partial summary judgment that have
     been granted, eliminating MEA's claims relating to Chugach's 1999 special
     meeting, holding that a certain Arthur Andersen report was properly
     withheld, and holding that certain matters considered by Chugach's Board in
     executive session were properly withheld.

     On March 5, 2001, Chugach filed a Motion for Partial Summary Judgement
     seeking dismissal of MEA's financial mismanagement claim, on the grounds
     that there is no genuine issue of material fact regarding whether Chugach
     properly managed its long-term bond indebtedness. Chugach relied
     substantially on the fact that MEA's financial experts did not opine that
     Chugach had acted unreasonably. On March 13, 2001, MEA filed a motion
     asking the court to deny Chugach's Motion for Partial Summary Judgment and
     instead reopen expert witness discovery so it could add additional experts.
     MEA's motion was granted allowing MEA to use additional expert witnesses.
     Briefing of Chugach's Motion for Partial Summary Judgement continues and
     oral argument on this motion has not been set.

     Discovery in this matter is still in its preliminary stages. While a trial
     date has not yet been set officially, the parties seek a trial in February
     2002. Because of the preliminary nature of the case, we are not able to
     estimate the costs of our participation.

     For additional information, refer to the discussion of this matter in Part
     I, Item 3 - Legal Proceedings, Matanuska Electric Association, Inc., v.
     Chugach Electric Association, Inc., 3AN 99-8152CI of the Form 10-K filed by
     Chugach with respect to the annual report period ended December 31, 2000.

     Item 2. Changes in Securities and Use of Proceeds

     Not applicable



<PAGE>


     Item 3. Defaults Upon Senior Securities

     Not applicable

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

     Not applicable

     Item 5. Other Information

     On April 26, 2001 at the Registrant's annual membership meeting, the
     members approved amendments to the Registrant's Bylaws and Articles of
     Incorporation. Included in the amendments were changes to allow any legally
     recognized entity to be eliglble to become a member of Chugach, to conform
     the bylaws to actual practice concerning the termination of members who
     fail to comply with Association regulations and to permit voting
     electronically over the Internet when allowed by state statute.

     The Regulatory Commission of Alaska approved of the proposed amendment to
     the contract for power sales to the City of Seward on June 7, 2001. The
     amendment extends the term of the agreement to January 31, 2006, provides
     protections for Chugach in the event of a sale of the Seward utility,
     allows for the rate terms of the contract to be re-opened after the
     Commission has made a final decision in Chugach's General Rate Case and
     allows for Seward to provide notice to Chugach that the contract is
     terminated effective 12 months from the effective final order of the
     Commission in the General Rate Case in the event that new price terms are
     not agreed.


     Item 6. Exhibits and Reports on Form 8-K

(a)      Exhibits:

         Articles of Incorporation (as amended April 26, 2001).

         Revised Amendment No. 1 to Agreement for the Sale and Purchase of
         Electric Power and Energy between the Registrant and the City of Seward
         dated effective as of June 7, 2001.

         Second Amendment to the Nikiski Cogeneration Plant System Use and
         Dispatch Agreement between the Registrant and Alaska Electric
         Generation and Transmission Cooperative, Inc. dated effective June
         1, 2001.

(b)      Reports on Form 8-K:

         No reports on Form 8-K were filed for the quarter ended June 30, 2001


<PAGE>



                                SIGNATURES

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



                             CHUGACH ELECTRIC ASSOCIATION, INC.



                             By:      /s/ Eugene N. Bjornstad

                                      Eugene N. Bjornstad
                                      General Manager

                             Date:    August 14, 2001



                             By:      /s/ Evan J. Griffith

                                      Evan J. Griffith
                                      Executive Manager, Finance & Energy Supply

                             Date:    August 14, 2001


<PAGE>


                                   EXHIBITS

     Listed below are the exhibits which are filed as part of this
     Report:
<TABLE>
<CAPTION>
<S>                    <C>                                                                                  <C>


     Exhibit Number             Description                                                                Page

          3.1          Articles of Incorporation (as amended April 26, 2001)                                22

         10.4          Revised Amendment No. 1 to Agreement for the Sale and Purchase of Electric           26
                       Power and Energy between the Registrant and the City of Seward dated
                       effective July 9, 2001.

        10.39          Second Amendment to the Nikiski Cogeneration Plant System Use and Dispatch           29
                       Agreement between the Registrant and Alaska Electric Generation and
                       Transmission Cooperative, Inc. dated effective June 1, 2001.


</TABLE>


<PAGE>