<PAGE>

                                  UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION

                             WASHINGTON, D.C. 20549

                                    FORM 10-Q


/X/  QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
For the quarterly period ended September 30, 2000

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


                        Commission file number: 333-40478


                               AES RED OAK, L.L.C.
             (Exact name of registrant as specified in its charter)


                DELAWARE                                 54-1889658
     (State or other jurisdiction of                   (I.R.S. Employer
     incorporation or organization)                  Identification Number)


               1001 NORTH 19TH STREET, ARLINGTON, VIRGINIA 22209,
                             C/O THE AES CORPORATION
                                 (703) 522-1315
             (Registrant's address of principal executive offices,)
              (zip code and telephone number, including area code)


     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 / /   No /X/


                                 (Page 1 of 15)
<PAGE>

                               AES RED OAK, L.L.C.

                                TABLE OF CONTENTS

<TABLE>
<CAPTION>
                                                                               Page No.
                                                                               --------
<S>                                                                            <C>
PART I.  FINANCIAL INFORMATION

   Item 1.  Condensed Consolidated Financial Statements (unaudited)

               Condensed Consolidated Statements of Operations,
                  Three months ended September 30, 2000, Six months
                  ended September 30, 2000 and the period from
                  March 15, 2000 (inception) through September 30, 2000 .......    3

               Condensed Consolidated Balance Sheets
                  September 30, 2000 and March 31, 2000 .......................    4

               Condensed Consolidated Statements of Changes in Member's
                  Deficit, Period from March 15, 2000 (inception)
                  through September 30,  2000 .................................    5

               Condensed Consolidated Statements of Cash Flows, Six
                  months ended September 30, 2000 and the period from
                  March 15, 2000 (inception) through September 30, 2000 .......    6

               Notes to the Condensed Consolidated Financial Statements........    7

   Item 2.  Management's Discussion and Analysis of Financial
               Condition and Results of Operations.............................   10

   Item 3.  Quantitative and Qualitative Disclosures
               About Market Risk...............................................   12

PART II. OTHER INFORMATION

   Item 6.  Exhibits and Reports on Form 8-K...................................   13

SIGNATURES.....................................................................   14

</TABLE>

                                 (Page 2 of 15)
<PAGE>

                          PART I. FINANCIAL INFORMATION

               Item 1. CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                   (UNAUDITED)

                               AES RED OAK, L.L.C.
                        (A DEVELOPMENT STAGE ENTERPRISE)

                CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS,
   THREE MONTHS ENDED SEPTEMBER 30, 2000, SIX MONTHS ENDED SEPTEMBER 30, 2000
             AND THE PERIOD FROM MARCH 15, 2000 (INCEPTION) THROUGH
                               SEPTEMBER 30, 2000
                             (DOLLARS IN THOUSANDS)

<TABLE>
<CAPTION>
                                                                                                      March 15, 2000
                                               Three Months Ended         Six Months Ended         (inception) through
                                               September 30, 2000        September 30, 2000         September 30, 2000
                                               ------------------        ------------------        -------------------
<S>                                            <C>                       <C>                       <C>
OPERATING EXPENSES
     General administrative costs.........         $   (11)                  $   (21)                  $  (183)
                                                   -------                   -------                   -------
     Operating Loss.......................             (11)                      (21)                     (183)

OTHER INCOME/EXPENSE
     Interest income......................             615                     1,248                     1,369
     Interest expense.....................            (792)                   (1,795)                   (1,999)
                                                   -------                   -------                   -------
NET LOSS..................................         $  (188)                  $  (568)                  $  (813)
                                                   =======                   =======                   =======

</TABLE>

           See notes to condensed consolidated financial statements.

                                 (Page 3 of 15)
<PAGE>

                               AES RED OAK, L.L.C.
                        (A DEVELOPMENT STAGE ENTERPRISE)

                      CONDENSED CONSOLIDATED BALANCE SHEETS
                      SEPTEMBER 30, 2000 AND MARCH 31, 2000
                             (DOLLARS IN THOUSANDS)

<TABLE>
<CAPTION>
                                                                                            As of                  As of
                                                                                      September 30, 2000      March 31, 2000
<S>                                                                                   <C>                     <C>
ASSETS:
Current Assets:
Cash .........................................................................            $      32             $      26
Investments held by trustee-at cost, which approximates market value .........                6,197                 2,940
                                                                                          ---------             ---------
Total current assets .........................................................                6,229                 2,966

Prepaid Construction Costs ...................................................              227,609               288,573
Land .........................................................................                4,240                 4,240
Construction in progress .....................................................              106,445                26,398
Deferred financing costs - net of accumulated amortization of $443 and $10,
     respectively.............................................................               18,227                18,709
Investments held by trustee-at cost, which approximates market value .........               26,634                45,809
                                                                                          ---------             ---------
Total assets .................................................................            $ 389,384             $ 386,695
                                                                                          =========             =========

LIABILITIES AND MEMBER'S DEFICIT:
Current Liabilities:
Accounts payable .............................................................            $     418             $     213
Accrued Interest .............................................................                2,821                 1,598
Payable to affiliate .........................................................                1,974                   252
Payable to parent ............................................................                  984                   877
                                                                                          ---------             ---------
Total current liabilities ....................................................                6,197                 2,940

Bonds payable ................................................................              384,000               384,000
                                                                                          ---------             ---------
Total liabilities ............................................................              390,197               386,940
                                                                                          =========             =========
Commitments (Notes 4 and 5)

Member's deficit:
Common stock, $1 par value-10 shares authorized, none issued or outstanding ..                 --                    --
Deficit accumulated during the development stage .............................                 (813)                 (245)
                                                                                          ---------             ---------
Total member's deficit .......................................................                 (813)                 (245)
                                                                                          ---------             ---------
Total liabilities and member's deficit .......................................            $ 389,384             $ 386,695
                                                                                          =========             =========

</TABLE>

            See notes to condensed consolidated financial statements.

                                 (Page 4 of 15)
<PAGE>

                               AES RED OAK, L.L.C.
                        (A DEVELOPMENT STAGE ENTERPRISE)

         CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN MEMBER'S DEFICIT
                           PERIOD FROM MARCH 15, 2000
                     (INCEPTION) THROUGH SEPTEMBER 30, 2000

                             (DOLLARS IN THOUSANDS)

<TABLE>
<CAPTION>
                                               Common Stock                Accumulated
                                            Shares        Amount       Deficit        Total
<S>                                         <C>           <C>         <C>            <C>
BALANCE, MARCH 15, 2000 ...........          --             --          --             --
Net Loss ..........................                                    $(245)         $(245)
                                            -----         -----        -----          -----
BALANCE, MARCH 31, 2000 ...........          --             --          (245)          (245)
Net Loss ..........................          --             --          (380)          (380)
                                            -----         -----        -----          -----
BALANCE, JUNE 30, 2000 ............          --             --          (625)          (625)
Net Loss ..........................          --             --          (188)          (188)
                                            -----         -----        -----          -----
BALANCE, SEPTEMBER 30, 2000 .......          --             --         $(813)         $(813)
                                            =====         =====        =====          =====
</TABLE>

            See notes to condensed consolidated financial statements.

                                 (Page 5 of 15)
<PAGE>

                               AES RED OAK, L.L.C.
                        (A DEVELOPMENT STAGE ENTERPRISE)

       CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS FOR THE SIX MONTHS
    ENDED SEPTEMBER 30, 2000 AND THE PERIOD FROM MARCH 15, 2000 (INCEPTION)
                           THROUGH SEPTEMBER 30, 2000
                             (DOLLARS IN THOUSANDS)

<TABLE>
<CAPTION>
                                                                                March 15, 2000
                                                         Six Months Ended     (inception) through
                                                        September 30, 2000     September 30, 2000
                                                        ------------------    -------------------
<S>                                                     <C>                   <C>
OPERATING ACTIVITIES:
Net loss .........................................        $    (568)            $    (813)
Amortization of deferred financing costs .........              433                   443
Change in:
Accounts Payable .................................              205                   418
Accrued interest .................................            1,223                 2,821
Payable to affiliates ............................            1,829                 2,958
                                                          ---------             ---------
Net cash provided by operating activities ........            3,122                 5,827
                                                          ---------             ---------
INVESTING ACTIVITIES:
Change in prepaid construction account ...........           60,964              (227,609)
Payments for construction in progress ............          (80,047)             (106,445)
Payments for land ................................             --                  (4,240)
Change in debt service reserve ...................           15,918               (32,831)
                                                          ---------             ---------
Net cash used in investing activities ............           (3,165)             (371,125)
                                                          ---------             ---------
FINANCING ACTIVITIES:
Proceeds from project debt issuance ..............             --                 384,000
Payments for deferred financing costs ............             --                 (18,719)
Other ............................................               49                    49
                                                          ---------             ---------
Net cash provided by financing activities ........               49               365,330
                                                          ---------             ---------
NET INCREASE IN CASH AND CASH EQUIVALENTS ........                6                    32
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD ...               26                  --
                                                          ---------             ---------
CASH AND CASH EQUIVALENTS, END OF PERIOD .........        $      32             $      32
                                                          =========             =========
SUPPLEMENTAL DISCLOSURE:
Interest paid ....................................        $  15,514             $  15,514
                                                          =========             =========
</TABLE>

            See notes to condensed consolidated financial statements.

                                 (Page 6 of 15)

<PAGE>

                               AES RED OAK, L.L.C.
                        (A DEVELOPMENT STAGE ENTERPRISE)

   NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS THREE MONTHS ENDED AND
     SIX MONTHS ENDED SEPTEMBER 30, 2000 AND THE PERIOD FROM MARCH 15, 2000
                     (INCEPTION) THROUGH SEPTEMBER 30, 2000

1.   ORGANIZATION

     AES Red Oak, L.L.C. (the Company) was formed on September 13, 1998, in the
     State of Delaware, to develop, construct, own and operate an 830-megawatt
     (MW) gas-fired, combined cycle electric generating facility (the facility)
     in Sayreville, New Jersey. The Company was considered dormant until March
     15, 2000, at which time it consummated a project financing and certain
     related agreements. The facility, currently under construction, will
     consist of three Westinghouse 501 FD combustion turbines, three unfired
     heat recovery steam generators, and one multicylinder steam turbine. The
     facility will produce and sell electricity, as well as provide fuel
     conversion and ancillary services, solely to Williams Energy Marketing and
     Trading Company (Williams) under a power purchase agreement with a term of
     20 years that will commence on the facility's anticipated commercial
     operation date, December 31, 2001.

     The Company is in the development stage and is not expected to generate any
     operating revenues until the facility achieves commercial operations. As
     with any new business venture of this size and nature, operation of the
     facility could be affected by many factors. Management of the Company
     believes that the assets of the Company are realizable.

     The Company is a wholly owned subsidiary of AES Red Oak, Inc. (Red Oak),
     which is a wholly-owned subsidiary of The AES Corporation (AES). Red Oak
     has no assets other than its ownership interests in the Company and AES
     Sayreville, L.L.C. Red Oak has no operations and is not expected to have
     any operations. Red Oak's only income will be from distributions it
     receives from the Company and AES Sayreville, L.L.C., once the Company
     achieves commercial operation. The equity that Red Oak is to provide to the
     Company will be provided to Red Oak by AES, which owns all of the stock of
     Red Oak. AES files quarterly and annual audited reports with the Securities
     and Exchange Commission under the Securities Exchange Act of 1934, which
     are publicly available. Red Oak's equity contribution obligations are
     required to be supported by either an insurance bond or letter of credit.
     Currently those obligations are supported by an insurance bond issued to
     the collateral agent.

     The Company owns all of the equity interests in AES Red Oak Urban Renewal
     Corporation (URC), which was organized as an urban renewal corporation
     under New Jersey Law. As an urban renewal corporation under New Jersey law,
     portions of the facility can be designated as redevelopment areas in order
     to provide real estate tax and development benefits to the facility. URC
     has no operations outside of its activities in connection with the
     facility.

     On March 15, 2000, the Company issued $384 million in senior secured bonds
     for the purpose of providing financing for the construction of the facility
     and to fund, through the construction period, interest payments to the
     bondholders. In late September 2000, the Company consummated an exchange
     offer whereby the holders of the senior secured bonds exchanged their
     privately placed senior secured bonds for registered senior secured bonds.

                                 (Page 7 of 15)
<PAGE>

     Pursuant to an equity subscription agreement (See Note 3), Red Oak has
     agreed to contribute up to approximately $55.7 million to the Company to
     fund construction after the bond proceeds have been fully utilized.

2.   BASIS OF PRESENTATION

     In the Company's opinion, all adjustments necessary for a fair presentation
     of the unaudited results of operations for the three months ended and six
     months ended September 30, 2000, and the period from March 15, 2000
     (inception) through September 30, 2000 are included. All such adjustments
     are accruals of a normal and recurring nature. The results of operations
     for the three months ended and six months ended September 30, 2000 and the
     period from March 15, 2000 (inception) through September 30, 2000, are not
     necessarily indicative of the results of operations to be expected for the
     full year.

     These financial statements have been prepared in accordance with generally
     accepted accounting principles for interim financial information and with
     the instructions to Form 10-Q and Regulation S-X. Accordingly, they do not
     include all of the information and footnotes required by generally accepted
     accounting principles for complete financial statements. Because the
     accompanying condensed consolidated financial statements do not include all
     of the information and footnotes required by generally accepted accounting
     principles, they should be read in conjunction with the audited financial
     statements for the period ended March 31, 2000 and notes thereto included
     in the Company's prospectus dated August 11, 2000.

3.   EQUITY SUBSCRIPTION AGREEMENT

     The Company, along with Red Oak, has entered into an Equity Subscription
     Agreement, pursuant to which Red Oak has agreed to contribute up to
     approximately $55.7 million to the Company to fund project costs. This
     amount is secured by an acceptable bond issued by Red Oak. Red Oak will
     fund these amounts as they come due upon the earlier of (a) expenditure of
     all funds that have been established for construction or (b) the
     occurrence, and during the continuation of, an event of default, as defined
     under the indenture governing its senior secured bonds. A portion of this
     equity requirement may be made in the form of affiliate debt, between Red
     Oak and the Company, which would be subordinate to the senior secured
     bonds.

4.   POWER PURCHASE AGREEMENT

     The Company and Williams have entered into a power purchase agreement (PPA)
     for the sale of all electric energy and capacity produced by the facility,
     as well as ancillary services and fuel conversion services. The term of the
     PPA is 20 years, commencing on the Commercial Operation Date defined in the
     PPA as the day the initial start up testing procedures have been
     successfully completed and notified to Williams by the Company. Payment
     obligations to the Company are guaranteed by The Williams Companies, Inc.
     Such payment obligations under the guarantee are capped at an amount equal
     to 125% of the sum of the principal amount of the senior secured bonds plus
     the maximum debt service reserve account required balance. The Company has
     provided Williams a guaranty issued by AES of specific payment obligations
     should the facility not achieve commercial operation by December 31, 2001.
     AES's liability under the guaranty is capped at $30 million. The Company
     has the option, and may be required under specific conditions described in
     the PPA, to replace the guaranty issued by AES with a letter of credit
     issued by a commercial bank. In such case, the repayment obligations with
     respect to drawings under the letter of credit are to be a senior debt
     obligation of the Company.

                                 (Page 8 of 15)
<PAGE>

5.   COMMITMENTS AND CONTINGENCIES

     CONSTRUCTION - The Company has entered into a fixed-price turnkey
     construction agreement (EPC) with Raytheon Engineers and Constructors, Inc.
     (the Contractor) for the design, engineering, procurement and construction
     of the facility. The Company has prepaid the EPC in the amount of $288.6
     million, representing a discounted fixed price. In consideration of the
     prepayment, the Contractor issued in favor of the Company a letter of
     credit with an initial amount of $237.7 million to be reduced over the
     construction period. As of September 30, 2000, the letter of credit has
     been reduced by approximately $61 million representing completion of
     certain construction milestones.

     On July 7, 2000, Morrison Knudsen Corporation completed its acquisition of
     the Contractor and formed the Washington Group International, Inc. (The
     Washington Group). The Washington Group is comprised of Morrison Knudsen
     Corporation, Raytheon Engineers & Constructors and Westinghouse Government
     Services Group. The terms and conditions under the EPC and the letter of
     credit obligation remain unchanged.

     MAINTENANCE SERVICES AGREEMENT - The Company has entered into an agreement
     with Siemens Westinghouse Power Corporation (Siemens). Siemens will provide
     the Company with specific combustion turbine maintenance services and spare
     parts for an initial term of between six and sixteen years. For the first
     six years of operation, the Company is committed to pay $306 per kilowatt
     hour of service. The value of this commitment is difficult to ascertain at
     this time due to the unknown operational mode Williams will require from
     the Company.

     WATER SUPPLY - The Company has entered into a contract with the Borough of
     Sayreville (the Borough) by which the Borough will provide untreated water
     to the Company. The contract has a term of 30 years with an option to
     extend for up to four additional five-year terms. The Company is
     contractually committed to a minimum annual payment of $300,000. Based on
     estimated maximum usage, the Company believes that its annual payment will
     not exceed approximately $400,000.

     INTERCONNECTION AGREEMENT - The Company has entered into an interconnection
     agreement with Jersey Central Power & Light Company d/b/a GPU Energy (GPU)
     to transmit the electricity generated by the facility to the transmission
     grid so that it may be sold as prescribed under the Company's PPA. The
     agreement is in effect for the life of the facility, yet may be terminated
     by mutual consent of both GPU and the Company under certain circumstances
     as detailed in the agreement. Costs associated with the agreement are based
     on electricity transmitted via GPU at a variable price, the PJM
     (Pennsylvania/New Jersey/Maryland) Tariff as charged by GPU to the Company,
     which is comprised of both service cost and asset recovery cost, as
     determined by GPU and approved by the Federal Energy Regulatory Committee.

     WATER SUPPLY PIPELINE - The Borough will design the Lagoon Water Pipeline,
     Lagoon Pumping Station and Sayreville Interconnection Number 2 in
     conformance with standard water system practice. The Company is responsible
     for selection of a contractor and for payment of all costs. The pipeline
     engineering and routing has been finalized. The construction contract has
     been awarded, pipeline materials have been procured and the construction
     will commence after closing of the right-of-way. The value of the pipeline
     contract is approximately $1 million and will be payable by December 2000.
     The construction contract for the Pumping Station has not been awarded. The
     value of the project is estimated to be approximately $500,000.

                                 (Page 9 of 15)
<PAGE>

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

     CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

     Some of the statements in this Form 10-Q, as well as statements made by the
     Company in periodic press releases and other public communications,
     constitute "forward-looking statements" within the meaning of the Private
     Securities Litigation Reform Act of 1995. Certain, but not necessarily all,
     of such forward-looking statements can be identified by the use of
     forward-looking terminology, such as "believes," "estimates," "plans,"
     "projects," "expects," "may," "will," "should," "approximately," or
     "anticipates" or the negative thereof or other variations thereof or
     comparable terminology, or by discussion of strategies, each of which
     involves risks and uncertainties. The Company has based these
     forward-looking statements on its current expectations and projections
     about future events based upon its knowledge of facts as of the date of
     this Form 10-Q and its assumptions about future events.

     All statements other than of historical facts included herein, including
     those regarding market trends, the Company's financial position, business
     strategy, projected plans and objectives of management for future
     operations and the anticipated commercial operation date of the facility,
     are forward-looking statements. Such forward-looking statements involve
     known and unknown risks, uncertainties and other factors outside of the
     Company's control that may cause the actual results or performance of the
     Company to be materially different from any future results, performance or
     achievements expressed or implied by the forward-looking statements. These
     risks, uncertainties and other factors include, among others, the
     following:

          -    unexpected construction delays,

          -    unexpected problems relating to the start-up, commissioning and
               performance of the facility,

          -    the financial condition of third parties on which we depend,

          -    an adequate merchant market after the expiration of the power
               purchase agreement,

          -    capital shortfalls and access to additional capital on reasonable
               terms,

          -    inadequate insurance coverage,

          -    unexpected expenses or lower than expected revenues once
               commercial operations have begun,

          -    environmental and regulatory compliance, and

          -    the additional factors discussed in the "Risk Factors" section of
               the Company's prospectus dated August 11, 2000.

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

     GENERAL

     The Company was formed on September 13, 1998 to develop, construct, own,
     operate and maintain its facility. The Company was dormant until March 15,
     2000, the date of the sale of the senior secured bonds. The Company is in
     the development stage and has no operating revenues. The Company obtained
     $384.0 million of project financing from the sale of the senior secured
     bonds. The total cost of the construction of the Company's facility is
     estimated to be approximately $439.8 million, which

                                 (Page 10 of 15)
<PAGE>

     will be financed by the proceeds from the sale of the senior secured bonds
     and the equity contribution described below. In late September 2000, the
     Company consummated an exchange offer whereby the holders of the senior
     secured bonds exchanged their privately placed senior secured bonds for
     registered senior secured bonds.

     The Company's facility is still under construction and is expected to be
     completed and operational by approximately December 31, 2001. The Company
     cannot assure that these expectations will be met. See "--Cautionary Note
     Regarding Forward-Looking Statements."

     EQUITY CONTRIBUTIONS

     Under the equity subscription agreement, Red Oak is obligated to contribute
     up to approximately $55.7 million to the Company to fund project costs. Red
     Oak's obligation to make the contributions is, and will be, supported by an
     acceptable letter of credit or an acceptable bond.

     RESULTS OF OPERATIONS

     As of September 30, 2000 and March 31, 2000, Construction in Progress,
     which includes capitalized facility construction costs, was $106.4 million
     and $26.4 million, respectively. For the three months and six months ended
     September 30, 2000, capitalized facility construction costs were $45.6
     million and $80.0 million, respectively. As discussed in greater detail
     below, Construction in Progress also includes the capitalization of
     construction related interest cost incurred on the portion of the bond
     proceeds expended during the construction period. These capitalized costs
     are included as assets on the balance sheet.

     The Company has prepaid the EPC contract in the amount of $288.6 million
     and in consideration of the prepayment the Contractor issued in favor of
     the Company a letter of credit. As of September 30, 2000, the letter of
     credit has been reduced by approximately $61 million, representing
     completion of certain construction milestones resulting in prepaid
     construction costs in the amount of $227.6 million and included as assets
     on the balance sheet. The cost of purchasing land for construction of the
     Company's facility has been separately identified on the Balance Sheets.

     For the three months and six months ended September 30, 2000 and the period
     from March 15, 2000 (inception) through September 30, 2000, general and
     administrative costs of $11,000, $21,000 and $183,000, respectively, were
     incurred. These costs did not directly relate to construction and are
     included as expenses in the Statement of Operations.

     A portion of the proceeds from the sale of the senior secured bonds have
     not yet been expended on construction and were invested by the trustee. For
     the three months and six months ended September 30, 2000 and the period
     from March 15, 2000 (inception) through September 30, 2000, the interest
     income earned on these invested funds was approximately $615,000, $1.2
     million and $1.4 million, respectively, and is included in the Statement of
     Operations.

     As noted above, for the three and six months ended September 30, 2000 and
     the period from March 15, 2000 (inception) through September 30, 2000,
     construction related interest costs incurred on the portion of the bond
     proceeds expended during the construction period is capitalized to
     Construction in Progress, was approximately $7.5 million, $14.9 million and
     $16.3 million respectively, and is included on the balance sheet. For the
     three months and six months ended September 30, 2000 and the period from
     March 15, 2000 (inception) through September 30, 2000, interest cost
     incurred on the bond proceeds not spent on construction of the Company's
     facility was approximately $792,000, $1.8

                                 (Page 11 of 15)
<PAGE>

     million and $2.0 million respectively, and is included as interest expense
     in the Statement of Operations.

     For the three and six months ended September 30, 2000 and the period from
     March 15, 2000 (inception) through September 30 2000, non-capitalizable
     costs plus interest cost and less interest income resulted in a net loss of
     approximately $188,000, $568,000 and $813,000 respectively. The results of
     operations may not be comparable with the results of operations during
     future periods, especially when the Company's facility commences commercial
     operations.

     LIQUIDITY AND CAPITAL RESOURCES

     The Company believes that the net proceeds from the sale of the senior
     secured bonds, together with the equity contribution, will be sufficient to
     (1) fund the engineering, procurement, construction, testing and
     commissioning of the Company's facility until it is placed in commercial
     operation, (2) pay certain fees and expenses in connection with the
     financing and development of the Company's project and (3) pay project
     costs, including interest on the senior secured bonds. After the Company's
     facility is placed in commercial operation, it will depend on revenues
     under the power purchase agreement, and after the power purchase agreement
     expires, it will depend revenues generated from market sales of
     electricity.

     In order to provide liquidity in the event of cash flow shortfalls, the
     debt service reserve account will contain an amount equal to the debt
     service reserve account required balance through cash funding, issuance of
     the debt service reserve letter of credit or a combination of the two.

     As of September 30, 2000, apart from commitments totaling $541,000 arising
     from the construction of the facility, the Company has committed to three
     additional capital expenditures totaling $1.8 million. These expenditures
     are for a water pipeline for approximately $1 million, road modifications
     for an estimated $332,000 and a water pumping station for an estimated
     $500,000. The Company expects to pay these amounts in fiscal year 2000 with
     the proceeds from the sale of the senior secured bonds issued on March 15,
     2000. As of September 30, 2000, water inlet infrastructure and pump-house
     design was complete. The electrical supply to the pump-house design is
     currently 95% complete. The Company is seeking bids for the installation of
     this scope of work.

     BUSINESS STRATEGY AND OUTLOOK

     The Company's overall business strategy is to market and sell all of its
     net capacity, fuel conversion and ancillary services to Williams during the
     20-year term of the power purchase agreement. After expiration of the power
     purchase agreement, the Company anticipates selling its facility's
     capacity, ancillary services and energy under a power purchase agreement or
     into the PJM power pool market. The Company intends to cause its facility
     to be managed, operated and maintained in compliance with the project
     contracts and all applicable legal requirements.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.

     The Company's market risks are not materially different from those market
     risks described in its prospectus dated August 11, 2000.

                                 (Page 12 of 15)
<PAGE>

                           PART II. OTHER INFORMATION

ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K

     a)   EXHIBITS

<TABLE>
<CAPTION>
               Exhibit Number         Description
               --------------         -----------
<S>                               <C>
                     27           Financial data schedule
</TABLE>

     b)   REPORTS ON FORM 8-K.

     The Company did not file any reports on Form 8-K during the quarter ended
September 30, 2000.

                                 (Page 13 of 15)

<PAGE>
                                   SIGNATURES

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


                                       AES RED OAK, L.L.C.



Date:  November 13, 2000               By: /s/ John Ruggirello
                                           ----------------------------
                                           John Ruggirello
                                           President


Date:  November 13, 2000               By: /s/ Barry Sharp
                                          ------------------------------
                                          Barry Sharp
                                          Vice President and Chief Financial
                                          Officer (and principal accounting
                                          officer)


                                 (Page 14 of 15)