FORM 10-Q

                       SECURITIES AND EXCHANGE COMMISSION

                             WASHINGTON, D.C. 20549
                             -----------------------

                [x] Quarterly Report Pursuant To Section 13 or 15(d) of the
                              Securities Exchange Act of 1934

                       FOR THE QUARTERLY PERIOD ENDED JUNE 30, 2000

                                       OR

                   [ ] Transition Report Pursuant to Section 13 or 15(d)
                           of the Securities Exchange Act of 1934
                                 -------------------------

<TABLE>

<S>                 <C>                                                   <C>            <C>
Commission          Exact name of registrant as specified in its charter  State of       I.R.S. Employer
File Number         and principal office address and telephone number     Incorporation  I.D. Number

1-14514             Consolidated Edison, Inc.                             New York       13-3965100
                    4 Irving Place, New York, New York 10003
                    (212) 460-4600

1-1217              Consolidated Edison Company
                      of New York, Inc.                                   New York       13-5009340
                    4 Irving Place, New York, New York 10003
                    (212) 460-4600

1-4315              Orange and Rockland Utilities, Inc.                   New York       13-1727729
                    One Blue Hill Plaza, Pearl River, New York 10965
                    (914) 352-6000

</TABLE>

Indicate  by check  mark  whether  each  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,  and (2) has been  subject to such filing
requirements for the past 90 days. Yes ___X___ No _______

As of the close of business on July 31, 2000,  Consolidated  Edison,  Inc. ("Con
Edison") had outstanding  211,970,337 Common Shares ($.10 par value). Con Edison
owns all of the outstanding common equity of Consolidated  Edison Company of New
York,  Inc.("Con  Edison of New York") and Orange and Rockland  Utilities,  Inc.
("O&R").

O&R MEETS THE CONDITIONS  SPECIFIED IN GENERAL  INSTRUCTION H (1) (a) AND (b) OF
FORM 10-Q AND IS THEREFORE FILING THIS FORM WITH THE REDUCED DISCLOSURE FORMAT.


<PAGE>

                                      - 2 -

                                TABLE OF CONTENTS

                                                                         PAGE

FILING FORMAT                                                               3

FORWARD-LOOKING STATEMENTS                                                  3

PART I. -  FINANCIAL INFORMATION

ITEM 1.    Financial  Statements

           Con Edison               Consolidated Balance Sheet            4-5
                                    Consolidated Income Statements        6-7
                                    Consolidated Statement of Cash Flows    8

                                    Notes to Financial Statements        9-12

           Con Edison of New York   Consolidated Balance Sheet          13-14
                                    Consolidated Income Statements      15-16
                                    Consolidated Statement of Cash Flows   17

                                    Notes to Financial Statements       18-20

            O&R                     Consolidated Balance Sheet          21-22
                                    Consolidated Income Statements      23-24
                                    Consolidated Statement of Cash Flows   25

                                    Notes to Financial Statements       26-29

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

                  Con Edison                                            30-40
                  Con Edison of New York                                41-50
                  O&R                                                     *

O&R MANAGEMENT'S NARRATIVE ANALYSIS OF THE RESULTS OF OPERATIONS        51-53


ITEM 3            Quantitative and Qualitative Disclosures About Market Risk

                  Con Edison                                               54
                  Con Edison of New York                                   54
                  O&R                                                     *


PART II. -  OTHER INFORMATION


ITEM 1.           Legal Proceedings                                     54-55

ITEM 4.           Submission of Matters to a Vote of Securities Holders    56

ITEM 6.           Exhibits and Reports on Form 8-K                      57-58

--------------------
* O&R is omitting  this  information  pursuant to General  Instruction H of Form
10-Q.


<PAGE>

                                      - 3 -

                                  FILING FORMAT

This Quarterly  Report on Form 10-Q is a combined report being filed  separately
by three  different  registrants:  Consolidated  Edison,  Inc.  ("Con  Edison"),
Consolidated  Edison  Company of New York,  Inc.  ("Con Edison of New York") and
Orange and Rockland Utilities,  Inc. ("O&R"). Neither Con Edison of New York nor
O&R makes any  representation  as to the  information  contained  in this report
relating to Con Edison or the subsidiaries of Con Edison other than itself.

O&R, a wholly-owned  subsidiary of Con Edison, meets the conditions specified in
General  Instruction  H of  Form  10-Q  and  is  permitted  to use  the  reduced
disclosure  format  for  wholly-owned  subsidiaries  of  companies,  such as Con
Edison,  that are reporting companies under the Securities Exchange Act of 1934.
Accordingly, O&R has omitted from this report the information called for by Part
1, Item 2,  Management's  Discussion  and  Analysis of Financial  Condition  and
Results of Operations and has included in this report its Management's Narrative
Analysis of the Results of Operations. In accordance with general instruction H,
O&R has also omitted  from this report the  information,  if any,  called for by
Part 1, Item 3, Quantitative and Qualitative  Disclosure About Market Risk; Part
II, Item 2, Changes in Securities and Use of Proceeds; Part II, Item 3, Defaults
Upon Senior Securities;  and Part II, Item 4, Submission of Matters to a Vote of
Security Holders.

                           FORWARD-LOOKING STATEMENTS

This Quarterly Report on Form 10-Q includes  forward-looking  statements,  which
are statements of future  expectation and not facts.  Words such as "estimates,"
"expects,"  "anticipates,"  "intends," "plans" and similar expressions  identify
forward-looking   statements.   Actual  results  or  developments  might  differ
materially  from those  included in the  forward-looking  statements  because of
factors such as competition  and industry  restructuring,  Con Edison's  pending
acquisition  of  Northeast  Utilities,  technological  developments,  changes in
economic  conditions,  changes in historical weather patterns,  changes in laws,
regulations  or  regulatory  policies,  developments  in legal or public  policy
doctrines, and other presently unknown or unforeseen factors.



<PAGE>
                                      - 4 -

                            CONSOLIDATED EDISON, INC.
                           CONSOLIDATED BALANCE SHEET
                    AS AT JUNE 30, 2000 AND DECEMBER 31, 1999
                                   (UNAUDITED)

<TABLE>
<CAPTION>
                                                                                 As at
                                                                    ------------------------------------
                                                                    June 30, 2000      December 31, 1999
                                                                    -------------      -----------------
                                                                          (Thousands of Dollars)
<S>                                                                 <C>                <C>
ASSETS
UTILITY PLANT, AT ORIGINAL COST
       Electric                                                      $11,502,711          $11,323,826
       Gas                                                             2,228,437            2,197,735
       Steam                                                             730,387              722,265
       General                                                         1,398,193            1,328,544
       Unregulated generating assets                                     352,039               48,583
                                                                     -----------          -----------
             Total                                                    16,211,767           15,620,953
          Less: Accumulated depreciation                               4,941,490            4,733,613
                                                                     -----------          -----------
             Net                                                      11,270,277           10,887,340
       Construction work in progress                                     415,137              381,804
       Nuclear fuel assemblies and components,
           less accumulated amortization                                 104,398               84,701
                                                                     -----------          -----------
                        NET UTILITY PLANT                             11,789,812           11,353,845
                                                                     -----------          -----------
CURRENT ASSETS
    Cash and temporary cash investments                                   37,656              485,050
    Accounts receivable - customer, less
         allowance for uncollectible accounts
         of $ 33,222 and $ 34,821                                        685,790              647,545
    Other receivables                                                    143,135               98,454
    Fuel, at average cost                                                 24,291               24,271
    Gas in storage, at average cost                                       43,881               55,387
    Materials and supplies, at average cost                              151,238              142,905
    Prepayments                                                          297,926              197,671
    Other current assets                                                  45,449               61,395
                                                                     -----------          -----------
                        TOTAL CURRENT ASSETS                           1,429,366            1,712,678
                                                                     -----------          -----------
INVESTMENTS
    Nuclear decommissioning trust funds                                  314,774              305,717
    Other                                                                192,757              182,201
                                                                     -----------          -----------
                        TOTAL INVESTMENTS                                507,531              487,918
                                                                     -----------          -----------
DEFERRED CHARGES AND REGULATORY ASSETS
     Goodwill                                                            422,034              427,496
     Regulatory assets
          Future federal income tax                                      773,323              785,014
          Recoverable energy costs                                       278,846               95,162
          Power contract termination costs                                72,659               71,861
          Accrued unbilled gas revenues                                   77,204               67,775
          Divestiture - capacity replacement reconciliation               73,850               24,373
          MTA business tax surcharge                                      64,942               60,712
          Other                                                          355,447              279,255
                                                                     -----------          -----------
                        Total regulatory assets                        1,696,271            1,384,152

     Other deferred charges                                              176,439              165,387
                                                                     -----------          -----------
                        TOTAL DEFERRED CHARGES AND
                             REGULATORY ASSETS                         2,294,744            1,977,035
                                                                     -----------          -----------
                                            TOTAL                    $16,021,453          $15,531,476
                                                                     ===========          ===========
</TABLE>

The accompanying notes are an integral part of these financial statements.


<PAGE>
                                      - 5 -

                            CONSOLIDATED EDISON, INC.
                           CONSOLIDATED BALANCE SHEET
                    AS AT JUNE 30, 2000 AND DECEMBER 31, 1999
                                   (UNAUDITED)

<TABLE>
<CAPTION>
                                                                              As at
                                                                -------------------------------------
                                                                June 30, 2000       December 31, 1999
                                                                -------------       -----------------
                                                                       (Thousands of Dollars)
<S>                                                             <C>                 <C>
CAPITALIZATION AND LIABILITIES
CAPITALIZATION
    Common stock, authorized 500,000,000
         shares; outstanding 211,968,422 shares
         and 213,810,634 shares                                 $  1,482,341           $  1,482,341
    Retained earnings                                              4,946,907              4,921,089
    Treasury stock, at cost; 23,210,700 shares
         and 21,358,500 shares                                    (1,015,642)              (955,311)
    Capital stock expense                                            (35,952)               (36,112)
                                                                ------------           ------------
TOTAL COMMON SHAREHOLDERS' EQUITY                                  5,377,654              5,412,007
                                                                ------------           ------------
    Preferred stock subject to mandatory redemption                   37,050                 37,050
    Other preferred stock                                            212,563                212,563
    Long-term debt                                                 4,933,529              4,524,604
                                                                ------------           ------------
                            TOTAL CAPITALIZATION                  10,560,796             10,186,224
                                                                ------------           ------------
NONCURRENT LIABILITIES
   Obligations under capital leases                                   33,040                 34,544
   Accumulated provision for injuries and damages                    128,062                119,010
   Pension and benefits reserve                                      183,640                143,757
   Other noncurrent liabilities                                       43,666                 42,865
                                                                ------------           ------------
                         TOTAL NONCURRENT LIABILITIES                388,408                340,176
                                                                ------------           ------------
CURRENT LIABILITIES
   Long - term debt due within one year                              328,230                395,000
   Notes payable                                                     204,280                495,371
   Accounts payable                                                  875,904                615,983
   Customer deposits                                                 203,687                204,421
   Accrued taxes                                                      76,662                 18,389
   Accrued interest                                                   58,336                 60,061
   Accrued wages                                                      80,704                 79,408
   Other current liabilities                                         261,482                232,706
                                                                ------------           ------------
                          TOTAL CURRENT LIABILITIES                2,089,285              2,101,339
                                                                ------------           ------------
DEFERRED CREDITS AND REGULATORY LIABILITIES
   Accumulated deferred federal income tax                         2,289,261              2,267,548
   Regulatory liabilities
        Gain on divestiture                                          307,130                306,867
        Accumulated deferred investment tax credits                  135,750                139,838
        Other                                                        250,823                189,317
                                                                ------------           ------------
                          Total regulatory liabilities               693,703                636,022

   Other deferred credits                                                 --                    167
                                                                ------------           ------------
                          TOTAL DEFERRED CREDITS AND
                          REGULATORY LIABILITIES                   2,982,964              2,903,737
                                                                ------------           ------------
                                               TOTAL            $ 16,021,453           $ 15,531,476
                                                                ============           ============
</TABLE>

The accompanying notes are an integral part of these financial statements.
<PAGE>
                                      - 6 -

                            CONSOLIDATED EDISON, INC.
                          CONSOLIDATED INCOME STATEMENT
                 FOR THE THREE MONTHS ENDED JUNE 30, 2000 AND 1999
                                   (UNAUDITED)

<TABLE>
<CAPTION>
                                                                     2000                  1999
                                                                  -----------           -----------
                                                                      (Thousands of Dollars)
<S>                                                               <C>                   <C>
OPERATING REVENUES
     Electric                                                     $ 1,531,262           $ 1,162,543
     Gas                                                              247,016               189,701
     Steam                                                             74,600                52,878
     Non-utility                                                      189,016                73,959
                                                                  -----------           -----------
             TOTAL OPERATING REVENUES                               2,041,894             1,479,081
                                                                  -----------           -----------
OPERATING EXPENSES
     Purchased power                                                  786,689               281,452
     Fuel                                                              47,381               121,427
     Gas purchased for resale                                         164,538                78,012
     Other operations                                                 289,865               278,421
     Maintenance                                                      128,140               103,286
     Depreciation and amortization                                    145,618               133,616
     Taxes, other than federal income tax                             275,349               284,978
     Federal income tax                                                32,985                48,204
                                                                  -----------           -----------
             TOTAL OPERATING EXPENSES                               1,870,565             1,329,396
                                                                  -----------           -----------

OPERATING INCOME                                                      171,329               149,685

OTHER INCOME (DEDUCTIONS)
     Investment income                                                  2,503                   577
     Allowance for equity funds used during construction                  485                   937
     Other income less miscellaneous deductions                        (4,037)               (1,046)
     Federal income tax                                                 1,049                  (658)
                                                                  -----------           -----------
             TOTAL OTHER INCOME (DEDUCTIONS)                            -                      (190)
                                                                  -----------           -----------

INCOME BEFORE INTEREST CHARGES                                        171,329               149,495

Interest on long-term debt                                             87,658                75,820
Other interest                                                         12,559                 4,317
Allowance for borrowed funds used during construction                  (1,032)                 (438)
                                                                  -----------           -----------
             NET INTEREST CHARGES                                      99,185                79,699
                                                                  -----------           -----------
PREFERRED STOCK DIVIDEND REQUIREMENTS                                   3,398                 3,398
                                                                  -----------           -----------
NET INCOME FOR COMMON STOCK                                       $    68,746           $    66,398
                                                                  ===========           ===========
COMMON SHARES OUTSTANDING - AVERAGE (000)                             211,966               225,982
BASIC EARNINGS PER SHARE                                          $      0.33           $      0.30
                                                                  ===========           ===========
DILUTED EARNINGS PER SHARE                                        $      0.33           $      0.30
                                                                  ===========           ===========
DIVIDENDS DECLARED PER SHARE OF COMMON STOCK                      $     0.545           $     0.535
                                                                  ===========           ===========
</TABLE>

The accompanying notes are an integral part of these financial statements.


<PAGE>
                                      - 7 -

                            CONSOLIDATED EDISON, INC.
                          CONSOLIDATED INCOME STATEMENT
                 FOR THE SIX MONTHS ENDED JUNE 30, 2000 AND 1999
                                   (UNAUDITED)

<TABLE>
<CAPTION>
                                                                     2000                  1999
                                                                  -----------           -----------
                                                                      (Thousands of Dollars)
<S>                                                               <C>                   <C>
OPERATING REVENUES
     Electric                                                     $ 3,043,511           $ 2,356,043
     Gas                                                              716,489               571,042
     Steam                                                            244,858               193,611
     Non-utility                                                      355,627               134,971
                                                                  -----------           -----------
             TOTAL OPERATING REVENUES                               4,360,485             3,255,667
                                                                  -----------           -----------
OPERATING EXPENSES
     Purchased power                                                1,515,851               569,277
     Fuel                                                             133,645               238,967
     Gas purchased for resale                                         430,837               258,543
     Other operations                                                 601,963               574,224
     Maintenance                                                      234,972               204,882
     Depreciation and amortization                                    288,340               266,324
     Taxes, other than federal income tax                             566,429               585,359
     Federal income tax                                               134,410               149,938
                                                                  -----------           -----------
             TOTAL OPERATING EXPENSES                               3,906,447             2,847,514
                                                                  -----------           -----------

OPERATING INCOME                                                      454,038               408,153

OTHER INCOME (DEDUCTIONS)
     Investment income                                                  6,826                 1,992
     Allowance for equity funds used during construction                  (91)                1,909
     Other income less miscellaneous deductions                        (4,205)               (1,413)
     Federal income tax                                                  (152)                 (878)
                                                                  -----------           -----------
             TOTAL OTHER INCOME (DEDUCTIONS)                            2,378                 1,610
                                                                  -----------           -----------

INCOME BEFORE INTEREST CHARGES                                        456,416               409,763

Interest on long-term debt                                            170,971               151,663
Other interest                                                         24,555                 9,150
Allowance for borrowed funds used during construction                  (2,787)                 (892)
                                                                  -----------           -----------
             NET INTEREST CHARGES                                     192,739               159,921
                                                                  -----------           -----------
PREFERRED STOCK DIVIDEND REQUIREMENTS                                   6,796                 6,796
                                                                  -----------           -----------
NET INCOME FOR COMMON STOCK                                       $   256,881           $   243,046
                                                                  ===========           ===========
COMMON SHARES OUTSTANDING - AVERAGE (000)                             212,352               228,496
BASIC EARNINGS PER SHARE                                          $      1.21           $      1.06
                                                                  ===========           ===========
DILUTED EARNINGS PER SHARE                                        $      1.21           $      1.06
                                                                  ===========           ===========
DIVIDENDS DECLARED PER SHARE OF COMMON STOCK                      $      1.09           $      1.07
                                                                  ===========           ===========
</TABLE>

The accompanying notes are an integral part of these financial statements.


<PAGE>
                                      - 8 -

                            CONSOLIDATED EDISON, INC.
                      CONSOLIDATED STATEMENT OF CASH FLOWS
                 FOR THE SIX MONTHS ENDED JUNE 30, 2000 AND 1999
                                   (UNAUDITED)

<TABLE>
<CAPTION>
                                                                                             2000                  1999
                                                                                          -----------           -----------
                                                                                               (Thousands of Dollars)
<S>                                                                                       <C>                   <C>
OPERATING ACTIVITIES
     Net income for common stock                                                          $   256,881           $   243,046
     PRINCIPAL NON-CASH CHARGES (CREDITS) TO INCOME
         Depreciation and amortization                                                        288,340               266,324
         Federal income tax deferred                                                           28,134               (21,368)
         Common equity component of allowance for funds used during construction                   91                (1,909)
         Other non-cash charges                                                                29,156                16,954
     CHANGES IN ASSETS AND LIABILITIES
         Accounts receivable - customer, less allowance for uncollectibles                    (38,245)                 (936)
         Materials and supplies, including fuel and gas in storage                              3,153                67,314
         Prepayments, other receivables and other current assets                             (128,990)              (47,325)
         Enlightened Energy program costs                                                      12,463                18,987
         Deferred recoverable energy costs                                                   (183,684)                9,803
         Cost of removal less salvage                                                         (44,575)              (34,144)
         Power contract termination costs                                                      (1,050)               (1,050)
         Accounts payable                                                                     259,921                13,689
         Accrued income taxes                                                                  31,470                21,018
         Other-net                                                                            (20,417)               53,784
                                                                                          -----------           -----------
                   NET CASH FLOWS FROM OPERATING ACTIVITIES                                   492,648               604,187
                                                                                          -----------           -----------
INVESTING ACTIVITIES INCLUDING CONSTRUCTION
         Construction expenditures                                                           (391,189)             (271,035)
         Nuclear fuel expenditures                                                            (24,114)               (2,947)
         Contributions to nuclear decommissioning trust                                       (10,650)              (10,650)
         Common equity component of allowance for funds used during construction                  (91)                1,909
         Funds held - divestiture of utility plant                                                 --            (1,101,814)
         Divestiture of utility plant (net of federal income tax)                                  --             1,167,016
         Non-regulated subsidiary investments                                                  (4,786)              (54,560)
         Non-regulated subsidiary utility plant                                              (258,987)                   --
                                                                                          -----------           -----------
                    NET CASH FLOWS USED IN INVESTING ACTIVITIES
                           INCLUDING CONSTRUCTION                                            (689,817)             (272,081)
                                                                                          -----------           -----------
FINANCING ACTIVITIES INCLUDING DIVIDENDS
         Repurchase of common stock                                                           (68,531)             (423,500)
         Net proceeds from short-term debt                                                   (291,091)              258,498
         Additions to long-term debt                                                          567,395               275,000
         Retirement of long-term debt                                                        (225,000)                   --
         Issuance and refunding costs                                                          (1,768)               (8,716)
         Common stock dividends                                                              (231,230)             (244,548)
                                                                                          -----------           -----------
                    NET CASH FLOWS FROM FINANCING ACTIVITIES
                           INCLUDING DIVIDENDS                                               (250,225)             (143,266)
                                                                                          -----------           -----------
NET INCREASE (DECREASE) IN CASH AND TEMPORARY
         CASH INVESTMENTS                                                                    (447,394)              188,840

CASH AND TEMPORARY CASH INVESTMENTS AT JANUARY 1                                              485,050               102,295
                                                                                          -----------           -----------
CASH AND TEMPORARY CASH INVESTMENTS AT JUNE 30                                            $    37,656           $   291,135
                                                                                          ===========           ===========
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION
      Cash paid during the period for:
             Interest                                                                     $   166,605           $   145,132
             Income taxes                                                                      74,245               118,283
</TABLE>

The accompanying notes are an integral part of these financial statements.




<PAGE>
                                      - 9 -

NOTES TO FINANCIAL STATEMENTS - CON EDISON

NOTE A - GENERAL

These footnotes accompany and form an integral part of the interim  consolidated
financial   statements  of  Consolidated  Edison,  Inc.  (Con  Edison)  and  its
subsidiaries, including the regulated utility Consolidated Edison Company of New
York, Inc. (Con Edison of New York),  the regulated  utility Orange and Rockland
Utilities,  Inc.  (O&R),  which Con Edison  acquired  in July 1999,  and several
non-utility  subsidiaries.  These financial statements are unaudited but, in the
opinion of Con Edison's management,  reflect all adjustments (which include only
normally  recurring  adjustments)  necessary for a fair statement of the results
for the interim periods  presented.  These financial  statements  should be read
together with the audited Con Edison financial  statements  (including the notes
thereto)  included in the  combined  Con Edison,  Con Edison of New York and O&R
Annual  Report on Form 10-K for the year  ended  December  31,  1999 (the  "Form
10-K").

NOTE B - ENVIRONMENTAL MATTERS


Hazardous  substances,  such as asbestos,  polychlorinated  biphenyls (PCBs) and
coal tar,  have been  used or  generated  in the  course  of  operations  of Con
Edison's  utility  subsidiaries  and may be  present  in  their  facilities  and
equipment.

The Federal Comprehensive Environmental Response, Compensation and Liability Act
of 1980  (Superfund)  and similar state statutes impose joint and several strict
liability,  regardless of fault,  upon  generators of hazardous  substances  for
resulting  removal and remedial  costs and  environmental  damages.  Liabilities
under these laws can be material and in some  instances  may be imposed  without
regard to fault, or may be imposed for past acts, even though such past acts may
have been lawful at the time they occurred.

At June 30, 2000,  Con Edison had accrued  $67.5 million as its best estimate of
the utility  subsidiaries'  liability  for sites as to which they have  received
process or notice alleging that hazardous  substances generated by them (and, in
most instances,  other potentially  responsible  parties) were deposited.  There
will be additional liability at these sites and other sites, the amount of which
is not  presently  determinable  but may be material to Con  Edison's  financial
position, results of operations or liquidity.

Con Edison's utility subsidiaries are permitted under current rate agreements to
defer for  subsequent  recovery  through  rates certain site  investigation  and
remediation  costs with respect to  hazardous  waste.  At June 30,  2000,  $42.7
million of such costs had been deferred as a regulatory  asset.

Suits  have been  brought  in New York  State and  federal  courts  against  Con
Edison's utility subsidiaries and many other defendants,  wherein a large number
of plaintiffs  sought large  amounts of  compensatory  and punitive  damages for
deaths and injuries allegedly caused by exposure to asbestos at various premises
of the utility  subsidiaries.  Many of these suits have been disposed of without
any payment by the utility subsidiaries,  or for immaterial amounts. The amounts
specified in all the  remaining  suits total  billions of dollars but Con Edison
believes that these amounts are greatly exaggerated,  as were the claims already
disposed of. Based on the  information and relevant  circumstances  known to Con
Edison at this time,  it does not believe  that these suits will have a material
adverse effect on its financial position, results of operations or liquidity.

<PAGE>

                                      - 10 -
NOTE C - NUCLEAR GENERATION
Con Edison of New York owns the Indian Point 2 nuclear  generating  unit,  which
has a capacity of approximately 1,000 MW, and the retired Indian Point 1 nuclear
generating unit. See Note G to the Con Edison financial  statements  included in
the Form 10-K.

On February 15, 2000,  Con Edison of New York shut down Indian Point 2 following
a leak  in one of its  four  steam  generators.  Nuclear  Regulatory  Commission
approval will be required for restart.

On March 30, 2000, the New York State Public Service  Commission (PSC) issued an
order  instituting a proceeding to investigate the Indian Point 2 outage and its
causes and the prudence of the  company's  actions  regarding  the operation and
maintenance of Indian Point 2 (the PSC Outage  Proceeding).  The order indicated
that the  examination  should  include,  among other  things,  Con Edison of New
York's  inspection  practices,  the circumstances  surrounding  Indian Point 2's
October 1997 to September 1998 outage,  the basis for  postponement of the steam
generator  replacement and whether,  and to what extent,  increased  replacement
power costs and repair and  replacement  costs  should be borne by Con  Edison's
shareholders.

On May 25, 2000, Westchester County, New York sued the PSC and Con Edison of New
York  seeking to prevent  the  company  from  recovering  costs  relating to the
ongoing outage. The suit, which is entitled The County of Westchester et al., v.
Maureen O. Helmer,  et al., was brought in the Supreme Court of the State of New
York, County of Albany.

The costs resulting from the  unavailability of Indian Point 2 to produce energy
have been included in the purchased  power costs that Con Edison of New York has
billed to customers under PSC-approved rate provisions.

Con Edison of New York has commenced  replacement of the steam  generators  with
steam  generators  it has  owned  since  1988.  The  company  expects  the steam
generator  replacement  to be  completed by the end of 2000 and  estimates  that
replacement will require additional expenditures (exclusive of replacement power
costs) of up to $150 million.

At June 30, 2000, Con Edison had accrued $30 million for its potential liability
to customers in connection with the ongoing outage.

On August 8, 2000, the Governor of State of New York signed into law an act (the
Indian Point 2 Law) which provides that:

         "With  respect to the  February  15, 2000 outage at the Indian  Point 2
         Nuclear  Facility,  the New York state public service  commission shall
         prohibit  the  Consolidated  Edison  Company from  recovering  from its
         ratepayers  any costs  associated  with  replacing  the power from such
         facility. Such prohibition shall apply to any such costs incurred until
         the  conclusion  of such  outage,  or  incurred  at any time  until all
         defective steam generation equipment at the facility has been replaced,
         whichever  occurs  later.  Such  prohibition  shall apply to  automatic
         adjustment  mechanisms as well as base rates or any other rate recovery
         mechanism.  The  commission  shall order the company to refund any such
         costs which have been recovered from ratepayers."

On August 9, 2000,  the PSC issued an order with  respect to the Indian  Point 2
Law. The order  directs Con Edison of New York to revise its electric  tariff to
prevent  prospective  recovery of these replacement power costs and,  commencing
September 2000, to implement a refund of all such costs collected since February
15, 2000.  The order  indicates that "the  anticipated  amount to be refunded to
customers is approximately $162 million."

On August  14,  2000,  the  company  initiated  an action in the  United  States
District  Court for the  Northern  District of New York,  entitled  Consolidated
Edison  Company  of New  York,  Inc.  v.  Pataki,  et al.,  seeking  to  prevent
implementation  of the  Indian  Point 2 Law and to have the  Indian  Point 2 Law
declared unconstitutional.

Con Edison  believes that the operation,  maintenance  and inspection  practices
related to Indian Point 2 have been prudent.  However, if the Indian Point 2 Law
is implemented and determined to be constitutional,  Con Edison of New York will
not recover from its customers its Indian Point 2  replacement  power costs.  In
addition,  Con Edison is unable to predict whether or not any other Indian Point
2-related  proceedings,  lawsuits,  legislation or other actions,  including the
PSC's Outage  Proceeding,  will have a material  adverse effect on its financial
position, results of operations or liquidity.

<PAGE>
                                      - 11 -
NOTE D  - O&R

In July 1999, Con Edison  completed its acquisition of O&R for $791.5 million in
cash.  See Note K to the Con Edison  financial  statements  included in the Form
10-K.  The unaudited pro forma  consolidated  Con Edison  financial  information
shown below has been  prepared  based upon the  historical  consolidated  income
statements of Con Edison and O&R for the three and six-month  periods ended June
30,1999,  giving effect to the  acquisition  as if it had occurred at January 1,
1999. The historical  information has been adjusted to reflect  amortization for
the three and  six-month  periods  of the  goodwill  recorded  by Con  Edison in
connection the acquisition and the after-tax cost Con Edison would have incurred
during the period for  financing the  acquisition  by issuing debt on January 1,
1999 at an assumed 8 percent per annum interest  rate. The proforma  information
is not  necessarily  indicative of the results that Con Edison would have had if
the  acquisition  had been completed prior to July 1999, or the results that Con
Edison will have in the future.

(Dollars in Thousands,               Three Months              Six Months
except per share amounts)            Ended                     Ended
                                     June 30, 1999             June 30, 1999

     Revenues                        $1,621,518                $3,581,159

     Operating income                   127,523                   393,572

     Net income                          54,983                   230,115

     Earnings per share              $     0.24              $       1.01

     Average shares outstanding (000)   225,982                   228,496


 NOTE E - FINANCIAL INFORMATION BY BUSINESS SEGMENT


                            CONSOLIDATED EDISON, INC.
                          SEGMENT FINANCIAL INFORMATION
                                     $000's

                FOR THE THREE MONTHS ENDED JUNE 30, 2000 AND 1999
                                   (UNAUDITED)

<TABLE>
<CAPTION>
                                                   ELECTRIC                                 GAS
                                       ------------------------------          ------------------------------
                                          2000                1999               2000                1999
                                       ----------          ----------          ----------          ----------
<S>                                    <C>                 <C>                 <C>                 <C>
Operating revenues                     $1,531,262          $1,162,543          $  247,016          $  189,701
Intersegment revenues                      12,993              40,234               2,106                 615
Depreciation and amortization             118,541             112,573              17,259              15,991
Operating income                          151,215             130,207              29,065              24,620
</TABLE>


<TABLE>
<CAPTION>
                                                    STEAM                                  OTHER
                                       ------------------------------          ------------------------------
                                          2000                1999                2000                1999
                                       ----------          ----------          ----------          ----------
<S>                                    <C>                 <C>                 <C>                 <C>
Operating revenues                     $   74,600          $   52,878          $  189,016          $   73,959
Intersegment revenues                         517                 414                 323                  88
Depreciation and amortization               4,618               4,476               5,200                 576
Operating income                           (4,088)             (2,386)             (4,863)             (2,756)
</TABLE>


<TABLE>
<CAPTION>
                                                     TOTAL
                                       -----------------------------
                                           2000              1999
                                       ----------         ----------
<S>                                    <C>                <C>
Operating revenues                     $2,041,894         $1,479,081
Intersegment revenues                      15,939             41,351
Depreciation and amortization             145,618            133,616
Operating income                          171,329            149,685
</TABLE>

<PAGE>
                                      - 12 -


                            CONSOLIDATED EDISON, INC.
                          SEGMENT FINANCIAL INFORMATION
                                     $000's

                 FOR THE SIX MONTHS ENDED JUNE 30, 2000 AND 1999
                                   (UNAUDITED)

<TABLE>
<CAPTION>
                                                  ELECTRIC                                  GAS
                                       ------------------------------          ------------------------------
                                          2000                1999                2000                1999
                                       ----------          ----------          ----------          ----------
<S>                                    <C>                 <C>                 <C>                 <C>
Operating revenues                     $3,043,511          $2,356,043          $  716,489          $  571,042
Intersegment revenues                      31,737              59,626               4,437               1,230
Depreciation and amortization             235,720             224,685              34,143              31,703
Operating income                          304,670             277,356             129,682             113,066
</TABLE>


<TABLE>
<CAPTION>
                                                   STEAM                                   OTHER
                                       ------------------------------          ------------------------------
                                          2000                1999                2000                1999
                                       ----------          ----------          ----------          ----------
<S>                                    <C>                 <C>                 <C>                 <C>
Operating revenues                     $  244,858          $  193,611          $  355,627          $  134,971
Intersegment revenues                         934                 827                 691                 309
Depreciation and amortization               9,210               8,925               9,267               1,011
Operating income                           26,337              27,316              (6,651)             (9,585)
</TABLE>


<TABLE>
<CAPTION>
                                                     TOTAL
                                       ------------------------------
                                           2000              1999
                                       ----------         ----------
<S>                                    <C>                <C>
Operating revenues                     $4,360,485         $3,255,667
Intersegment revenues                      37,799             61,992
Depreciation and amortization             288,340            266,324
Operating income                          454,038            408,153
</TABLE>



<PAGE>

                                      - 13 -

                  CONSOLIDATED EDISON COMPANY OF NEW YORK, INC.
                                  BALANCE SHEET
                    AS AT JUNE 30, 2000 AND DECEMBER 31, 1999
                                   (UNAUDITED)

<TABLE>
<CAPTION>
                                                                                 As at
                                                                   ------------------------------------
                                                                   June 30, 2000      December 31, 1999
                                                                    -----------          -----------
                                                                        (Thousands of Dollars)
<S>                                                                <C>                <C>
ASSETS
UTILITY PLANT, AT ORIGINAL COST
       Electric                                                     $10,872,604          $10,670,257
       Gas                                                            1,970,437            1,934,090
       Steam                                                            730,387              722,265
       General                                                        1,248,594            1,220,948
                                                                    -----------          -----------
             Total                                                   14,822,022           14,547,560
          Less: Accumulated depreciation                              4,534,397            4,384,783
                                                                    -----------          -----------
             Net                                                     10,287,625           10,162,777
       Construction work in progress                                    387,891              359,431
       Nuclear fuel assemblies and components,
           less accumulated amortization                                104,398               84,701
                                                                    -----------          -----------
                        NET UTILITY PLANT                            10,779,914           10,606,909
                                                                    -----------          -----------
CURRENT ASSETS
    Cash and temporary cash investments                                   1,164              349,033
    Accounts receivable - customer, less
         allowance for uncollectible accounts
         of $ 22,227 and $ 22,600                                       534,431              541,978
    Other receivables                                                    81,992               71,746
    Fuel, at average cost                                                23,666               23,641
    Gas in storage, at average cost                                      35,145               40,280
    Materials and supplies, at average cost                             145,139              138,300
    Prepayments                                                         271,125              178,693
    Other current assets                                                 37,936               32,513
                                                                    -----------          -----------
                        TOTAL CURRENT ASSETS                          1,130,598            1,376,184
                                                                    -----------          -----------
INVESTMENTS
    Nuclear decommissioning trust funds                                 314,774              305,717
    Other                                                                16,659               18,491
                                                                    -----------          -----------
                        TOTAL INVESTMENTS                               331,433              324,208
                                                                    -----------          -----------
DEFERRED CHARGES AND REGULATORY ASSETS
    Regulatory assets
         Future federal income tax                                      740,697              751,899
         Recoverable energy costs                                       245,129               78,650
         Divestiture - capacity replacement reconciliation               73,850               24,373
         Power contract termination costs                                72,659               71,861
         MTA business tax surcharge                                      59,938               60,712
         Property tax reconciliation                                     45,266               29,751
         Accrued unbilled gas revenue                                    43,594               43,594
         Other                                                          179,987              164,411
                                                                    -----------          -----------
                        Total regulatory assets                       1,461,120            1,225,251
    Other deferred charges                                              150,904              149,600
                                                                    -----------          -----------
                        TOTAL DEFERRED CHARGES AND
                             REGULATORY ASSETS                        1,612,024            1,374,851
                                                                    -----------          -----------
                                            TOTAL                   $13,853,969          $13,682,152
                                                                    ===========          ===========
</TABLE>

The accompanying notes are an integral part of these financial statements.


<PAGE>
                                      - 14 -

                  CONSOLIDATED EDISON COMPANY OF NEW YORK, INC.
                                  BALANCE SHEET
                    AS AT JUNE 30, 2000 AND DECEMBER 31, 1999
                                   (UNAUDITED)

<TABLE>
<CAPTION>
                                                                                 As at
                                                                   --------------------------------------
                                                                   June 30, 2000        December 31, 1999
                                                                   -------------        -----------------
                                                                            (Thousands of Dollars)
<S>                                                                <C>                  <C>
CAPITALIZATION AND LIABILITIES
CAPITALIZATION
    Common stock                                                    $  1,482,341           $  1,482,341
    Repurchased CEI common stock                                        (962,092)              (940,477)
    Retained earnings                                                  3,906,176              3,887,993
    Capital stock expense                                                (35,951)               (36,086)
                                                                    ------------           ------------
           TOTAL COMMON SHAREHOLDERS' EQUITY                           4,390,474              4,393,771
                                                                    ------------           ------------
    Preferred stock
      Subject to mandatory redemption
               6-1/8% Series J                                            37,050                 37,050
                                                                    ------------           ------------
           TOTAL SUBJECT TO MANDATORY REDEMPTION                          37,050                 37,050
                                                                    ------------           ------------
      Other preferred stock
             $5 Cumulative Preferred                                     175,000                175,000
               4.65% Series C                                             15,330                 15,330
               4.65% Series D                                             22,233                 22,233
                                                                    ------------           ------------
                            TOTAL OTHER PREFERRED STOCK                  212,563                212,563
                                                                    ------------           ------------
                                  TOTAL PREFERRED STOCK                  249,613                249,613
                                                                    ------------           ------------
    Long - term debt                                                   4,418,735              4,243,080
                                                                    ------------           ------------
                                      TOTAL CAPITALIZATION             9,058,822              8,886,464
                                                                    ------------           ------------
NONCURRENT LIABILITIES
   Obligations under capital leases                                       32,931                 34,406
   Accumulated provision for injuries and damages                        119,633                110,131
   Pension and benefits reserve                                          113,861                 76,807
   Other noncurrent liabilities                                           17,210                 17,210
                                                                    ------------           ------------
                         TOTAL NONCURRENT LIABILITIES                    283,635                238,554
                                                                    ------------           ------------
CURRENT LIABILITIES
   Long - term debt due within one year                                  300,000                275,000
   Accounts payable                                                      714,508                505,357
   Notes payable                                                         109,930                495,371
   Customer deposits                                                     192,641                208,865
   Accrued taxes                                                          70,049                 23,272
   Accrued interest                                                       52,427                 51,581
   Accrued wages                                                          80,704                 79,408
   Other current liabilities                                             198,473                202,657
                                                                    ------------           ------------
                          TOTAL CURRENT LIABILITIES                    1,718,732              1,841,511
                                                                    ------------           ------------
DEFERRED CREDITS AND REGULATORY LIABILITIES
   Accumulated deferred federal income tax                             2,135,706              2,121,054
   Regulatory liabilities
        Gain on divestiture                                              307,130                306,867
        Accumulated deferred investment tax credits                      128,626                132,487
        Other                                                            221,318                155,215
                                                                    ------------           ------------
                          Total regulatory liabilities                   657,074                594,569

                          TOTAL DEFERRED CREDITS AND
                          REGULATORY LIABILITIES                       2,792,780              2,715,623
                                                                    ------------           ------------
                                               TOTAL                $ 13,853,969           $ 13,682,152
                                                                    ============           ============
</TABLE>

The accompanying notes are an integral part of these financial statements.
<PAGE>
                                      - 15 -

                  CONSOLIDATED EDISON COMPANY OF NEW YORK, INC.
                                INCOME STATEMENT
                FOR THE THREE MONTHS ENDED JUNE 30, 2000 AND 1999
                                   (UNAUDITED)

<TABLE>
<CAPTION>
                                                                        2000                   1999
                                                                     ------------           ------------
                                                                           (Thousands of Dollars)
<S>                                                                  <C>                    <C>
OPERATING REVENUES
     Electric                                                        $  1,429,502           $  1,200,079
     Gas                                                                  217,380                189,701
     Steam                                                                 74,600                 52,878
                                                                     ------------           ------------
            TOTAL OPERATING REVENUES                                    1,721,482              1,442,658
                                                                     ------------           ------------
OPERATING EXPENSES
     Purchased power                                                      639,181                274,556
     Fuel                                                                  42,731                121,427
     Gas purchased for resale                                              90,628                 65,192
     Other operations                                                     239,195                261,982
     Maintenance                                                          121,556                103,286
     Depreciation and amortization                                        132,959                133,040
     Taxes, other than federal income tax                                 257,116                281,313
     Federal income tax                                                    32,160                 49,421
                                                                     ------------           ------------
            TOTAL OPERATING EXPENSES                                    1,555,526              1,290,217
                                                                     ------------           ------------
OPERATING INCOME                                                          165,956                152,441

OTHER INCOME (DEDUCTIONS)
     Investment income                                                        817                    130
     Allowance for equity funds used during construction                      400                    937
     Other income less miscellaneous deductions                            (2,315)                  (608)
     Federal income tax                                                     1,206                   (887)
                                                                     ------------           ------------
            TOTAL OTHER INCOME (DEDUCTIONS)                                   108                   (428)
                                                                     ------------           ------------
INCOME BEFORE INTEREST CHARGES                                            166,064                152,013

Interest on long-term debt                                                 81,148                 75,820
Other interest                                                             11,292                  4,061
Allowance for borrowed funds used during construction                        (905)                  (438)
                                                                     ------------           ------------
            NET INTEREST CHARGES                                           91,535                 79,443
                                                                     ------------           ------------
NET INCOME                                                                 74,529                 72,570
PREFERRED STOCK DIVIDEND REQUIREMENTS                                       3,398                  3,398
                                                                     ------------           ------------
NET INCOME FOR COMMON STOCK                                          $     71,131           $     69,172
                                                                     ============           ============
CON EDISON OF NEW YORK SALES
     Electric (thousands of kilowatthours)
        Con Edison of New York customers                                7,402,219              7,167,682
        Delivery service for Retail Choice                              2,120,980              1,817,004
        Delivery service to NYPA and others                             2,336,904              2,256,496
                                                                     ------------           ------------
            Total sales in service territory                           11,860,103             11,241,182
        Off-system and ESCO sales                                         877,683              2,470,029
     Gas (dekatherms)
        Firm sales and transportation                                  18,949,573             17,609,992
        Off-peak firm/interruptible                                     3,500,595              2,799,192
                                                                     ------------           ------------
            Total sales to Con Edison of New York customers            22,450,168             20,409,184
        Transportation of customer-owned gas
            NYPA                                                        5,756,826              2,251,072
            Other                                                      24,811,439              4,667,475
        Off-system sales                                                6,911,069              8,003,871
                                                                     ------------           ------------
            Total sales and transportation                             59,929,502             35,331,602
     Steam (thousands of pounds)                                        4,666,444              4,558,681
</TABLE>

The accompanying notes are an integral part of these financial statements.

<PAGE>
                                      - 16 -

                  CONSOLIDATED EDISON COMPANY OF NEW YORK, INC.
                                INCOME STATEMENT
                FOR THE SIX MONTHS ENDED JUNE 30, 2000 AND 1999
                                   (UNAUDITED)

<TABLE>
<CAPTION>
                                                                        2000                   1999
                                                                     ------------           ------------
                                                                           (Thousands of Dollars)
<S>                                                                 <C>                     <C>
OPERATING REVENUES
     Electric                                                        $   2,852,663          $  2,410,274
     Gas                                                                   611,022               571,042
     Steam                                                                 244,858               193,611
                                                                      ------------           ------------
            TOTAL OPERATING REVENUES                                     3,708,543             3,174,927
                                                                      ------------           ------------
OPERATING EXPENSES
     Purchased power                                                     1,257,424               556,998
     Fuel                                                                  127,929               238,967
     Gas purchased for resale                                              250,180               213,253
     Other operations                                                      496,294               543,400
     Maintenance                                                           222,241               204,882
     Depreciation and amortization                                         264,498               265,313
     Taxes, other than federal income tax                                  527,419               580,189
     Federal income tax                                                    128,117               154,187
                                                                      ------------          ------------
            TOTAL OPERATING EXPENSES                                     3,274,102             2,757,189
                                                                      ------------          ------------
OPERATING INCOME                                                           434,441               417,738

OTHER INCOME (DEDUCTIONS)
     Investment income                                                       1,550                   192
     Allowance for equity funds used during construction                      (226)                1,909
     Other income less miscellaneous deductions                             (2,298)               (1,243)
     Federal income tax                                                        816                  (945)
                                                                      ------------          ------------
            TOTAL OTHER INCOME (DEDUCTIONS)                                   (158)                  (87)
                                                                      ------------          ------------
INCOME BEFORE INTEREST CHARGES                                             434,283               417,651

Interest on long-term debt                                                 157,898               151,663
Other interest                                                              22,762                 8,895
Allowance for borrowed funds used during construction                       (2,585)                 (892)
                                                                      ------------          ------------
            NET INTEREST CHARGES                                           178,075               159,666
                                                                      ------------          ------------
NET INCOME                                                                 256,208               257,985
PREFERRED STOCK DIVIDEND REQUIREMENTS                                        6,796                 6,796
                                                                      ------------          ------------
NET INCOME FOR COMMON STOCK                                          $     249,412          $    251,189
                                                                     =============          ============
CON EDISON OF NEW YORK SALES
     Electric (thousands of kilowatthours)
        Con Edison of New York customers                                15,018,669            15,573,926
        Delivery service for Retail Choice                               4,375,829             2,866,072
        Delivery service to NYPA and others                              4,811,793             4,729,835
                                                                      ------------          ------------
            Total sales in service territory                            24,206,291            23,169,833
        Off-system and ESCO sales                                        2,444,237             3,828,190
     Gas (dekatherms)
        Firm sales and transportation                                   60,647,576            58,205,342
        Off-peak firm/interruptible                                      8,355,644             7,962,748
                                                                      ------------          ------------
            Total sales to Con Edison of New York customers             69,003,220            66,168,090
        Transportation of customer-owned gas
            NYPA                                                         8,981,343             2,267,025
            Other                                                       45,133,010            11,468,573
        Off-system sales                                                15,809,633            16,461,693
                                                                      ------------          ------------
            Total sales and transportation                             138,927,206            96,365,381
     Steam (thousands of pounds)                                        14,892,054            14,774,938
</TABLE>

The accompanying notes are an integral part of these financial statements.


<PAGE>
                                      - 17 -

                  CONSOLIDATED EDISON COMPANY OF NEW YORK, INC.
                             STATEMENT OF CASH FLOWS
                 FOR THE SIX MONTHS ENDED JUNE 30, 2000 AND 1999
                                   (UNAUDITED)

<TABLE>
<CAPTION>
                                                                                             2000                  1999
                                                                                          -----------           -----------
                                                                                                (Thousands of Dollars)
<S>                                                                                       <C>                   <C>
OPERATING ACTIVITIES
     Net income                                                                           $   256,208           $   257,985
     PRINCIPAL NON-CASH CHARGES (CREDITS) TO INCOME
         Depreciation and amortization                                                        264,498               265,313
         Federal income tax deferred                                                           21,235               (27,847)
         Common equity component of allowance for funds used during construction                  226                (1,909)
         Other non-cash charges                                                                 4,976                16,954
     CHANGES IN ASSETS AND LIABILITIES
         Accounts receivable - customer, less allowance for uncollectibles                      7,547                10,919
         Materials and supplies, including fuel and gas in storage                             (1,729)               66,435
         Prepayments, other receivables and other current assets                             (108,101)              (42,636)
         Enlightened Energy program costs                                                      12,463                18,987
         Deferred recoverable energy costs                                                   (166,479)                9,803
         Cost of removal less salvage                                                         (44,575)              (34,144)
         Power contract termination costs                                                      (1,050)               (1,050)
         Accounts payable                                                                     209,151                12,525
         Accrued income taxes                                                                  23,754                16,553
         Other-net                                                                             34,564                81,202
                                                                                          -----------           -----------
                   NET CASH FLOWS FROM OPERATING ACTIVITIES                                   512,688               649,090
                                                                                          -----------           -----------
INVESTING ACTIVITIES INCLUDING CONSTRUCTION
         Construction expenditures                                                           (370,878)             (271,035)
         Nuclear fuel expenditures                                                            (24,114)               (2,947)
         Contributions to nuclear decommissioning trust                                       (10,650)              (10,650)
         Common equity component of allowance for funds used during construction                 (226)                1,909
         Funds held - divestiture of utility plant                                                 --            (1,101,814)
         Divestiture of utility plant (net of federal income tax)                                  --             1,167,016
                                                                                          -----------           -----------
                    NET CASH FLOWS USED IN INVESTING ACTIVITIES
                         INCLUDING CONSTRUCTION                                              (405,868)             (217,521)
                                                                                          -----------           -----------
FINANCING ACTIVITIES INCLUDING DIVIDENDS
         Repurchase of common stock                                                           (29,454)             (423,500)
         Net proceeds from short-term debt                                                   (385,441)              221,498
         Issuance of long-term debt                                                           325,000               275,000
         Retirement of long-term debt                                                        (125,000)                   --
         Issuance and refunding costs                                                          (1,768)               (8,716)
         Common stock dividends                                                              (231,230)             (244,548)
         Preferred stock dividends                                                             (6,796)               (6,796)
                                                                                          -----------           -----------
                    NET CASH FLOWS FROM FINANCING ACTIVITIES
                                  INCLUDING DIVIDENDS                                        (454,689)             (187,062)
                                                                                          -----------           -----------
NET INCREASE (DECREASE) IN CASH AND TEMPORARY
         CASH INVESTMENTS                                                                    (347,869)              244,507

CASH AND TEMPORARY CASH INVESTMENTS AT JANUARY 1                                              349,033                30,026
                                                                                          -----------           -----------
CASH AND TEMPORARY CASH INVESTMENTS AT JUNE 30                                            $     1,164           $   274,533
                                                                                          ===========           ===========
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION
     Cash paid during the period for:
             Interest                                                                     $   151,794           $   145,132
             Income taxes                                                                      67,515               129,217
</TABLE>

The accompanying notes are an integral part of these financial statements.


<PAGE>

                                     - 18 -

NOTES TO FINANCIAL STATEMENTS - CON EDISON OF NEW YORK

NOTE A - GENERAL

These footnotes accompany and form an integral part of the interim  consolidated
financial  statements  of  Consolidated  Edison  Company of New York,  Inc. (Con
Edison of New York) and its subsidiaries. Consolidated Edison, Inc. (Con Edison)
owns all of the  outstanding  common  stock of Con  Edison  of New  York.  These
financial  statements  are  unaudited  but,  in the opinion of Con Edison of New
York's  management,   reflect  all  adjustments  (which  include  only  normally
recurring  adjustments)  necessary  for a fair  statement of the results for the
interim periods  presented.  These financial  statements should be read together
with the  audited Con Edison of New York  financial  statements  (including  the
notes thereto)  included in the combined Con Edison,  Con Edison of New York and
Orange and  Rockland  Utilities,  Inc.  Annual  Report on Form 10-K for the year
ended December 31, 1999 (the "Form 10-K").

NOTE B - ENVIRONMENTAL MATTERS

Hazardous  substances,  such as asbestos,  polychlorinated  biphenyls (PCBs) and
coal tar,  have been used or generated in the course of operations of Con Edison
of New York and may be present in its  facilities  and  equipment.  The  Federal
Comprehensive  Environmental  Response,  Compensation  and Liability Act of 1980
(Superfund)   and  similar  state  statutes  impose  joint  and  several  strict
liability,  regardless of fault,  upon  generators of hazardous  substances  for
resulting  removal and remedial  costs and  environmental  damages.  Liabilities
under these laws can be material and in some  instances  may be imposed  without
regard to fault, or may be imposed for past acts, even though such past acts may
have been lawful at the time they occurred.

At June 30, 2000,  Con Edison of New York had accrued  $50.2 million as its best
estimate  of its  liability  for sites as to which it has  received  process  or
notice alleging that hazardous substances generated by the company (and, in most
instances,  other potentially responsible parties) were deposited. There will be
additional  liability at these sites and other sites, the amount of which is not
presently  determinable but may be material to the company's financial position,
results of operations or liquidity.

Under Con Edison of New York's current electric,  gas and steam rate agreements,
site  investigation  and  remediation  costs in  excess of $5  million  annually
incurred with respect to hazardous  waste for which it is responsible  are to be
deferred and subsequently reflected in rates. At June 30, 2000, $24.2 million of
such costs had been deferred as a regulatory asset.

Suits have been brought in New York State and federal  courts against Con Edison
of New York and many  other  defendants,  wherein a large  number of  plaintiffs
sought  large  amounts  of  compensatory  and  punitive  damages  for deaths and
injuries  allegedly  caused by exposure  to asbestos at various  premises of the
company.  Many of these  suits have been  disposed of without any payment by Con
Edison of New York, or for immaterial amounts.  The amounts specified in all the
remaining  suits total  billions of dollars but the company  believes that these
amounts are greatly  exaggerated,  as were the claims already disposed of. Based
on the information and relevant circumstances known to the company at this time,
it does not believe that these suits will have a material  adverse effect on its
financial position, results of operations or liquidity.


<PAGE>
                                     - 19 -

NOTE C - NUCLEAR GENERATION
Con Edison of New York owns the Indian Point 2 nuclear  generating  unit,  which
has a capacity of approximately 1,000 MW, and the retired Indian Point 1 nuclear
generating unit. See Note G to the Con Edison financial  statements  included in
the Form 10-K.

On February 15, 2000,  Con Edison of New York shut down Indian Point 2 following
a leak  in one of its  four  steam  generators.  Nuclear  Regulatory  Commission
approval will be required for restart.

On March 30, 2000, the New York State Public Service  Commission (PSC) issued an
order  instituting a proceeding to investigate the Indian Point 2 outage and its
causes and the prudence of the  company's  actions  regarding  the operation and
maintenance of Indian Point 2 (the PSC Outage  Proceeding).  The order indicated
that the  examination  should  include,  among other  things,  Con Edison of New
York's  inspection  practices,  the circumstances  surrounding  Indian Point 2's
October 1997 to September 1998 outage,  the basis for  postponement of the steam
generator  replacement and whether,  and to what extent,  increased  replacement
power costs and repair and  replacement  costs  should be borne by Con  Edison's
shareholders.

On May 25, 2000, Westchester County, New York sued the PSC and Con Edison of New
York  seeking to prevent  the  company  from  recovering  costs  relating to the
ongoing outage. The suit, which is entitled The County of Westchester et al., v.
Maureen O. Helmer,  et al., was brought in the Supreme Court of the State of New
York, County of Albany.

The costs resulting from the  unavailability of Indian Point 2 to produce energy
have been included in the purchased  power costs that Con Edison of New York has
billed to customers under PSC-approved rate provisions.

Con Edison of New York has commenced  replacement of the steam  generators  with
steam  generators  it has  owned  since  1988.  The  company  expects  the steam
generator  replacement  to be  completed by the end of 2000 and  estimates  that
replacement will require additional expenditures (exclusive of replacement power
costs) of up to $150 million.

At June 30, 2000, Con Edison had accrued $30 million for its potential liability
to customers in connection with the ongoing outage.

On August 8, 2000, the Governor of State of New York signed into law an act (the
Indian Point 2 Law) which provides that:

         "With  respect to the  February  15, 2000 outage at the Indian  Point 2
         Nuclear  Facility,  the New York state public service  commission shall
         prohibit  the  Consolidated  Edison  Company from  recovering  from its
         ratepayers  any costs  associated  with  replacing  the power from such
         facility. Such prohibition shall apply to any such costs incurred until
         the  conclusion  of such  outage,  or  incurred  at any time  until all
         defective steam generation equipment at the facility has been replaced,
         whichever  occurs  later.  Such  prohibition  shall apply to  automatic
         adjustment  mechanisms as well as base rates or any other rate recovery
         mechanism.  The  commission  shall order the company to refund any such
         costs which have been recovered from ratepayers."

On August 9, 2000,  the PSC issued an order with  respect to the Indian  Point 2
Law. The order  directs Con Edison of New York to revise its electric  tariff to
prevent  prospective  recovery of these replacement power costs and,  commencing
September 2000, to implement a refund of all such costs collected since February
15, 2000.  The order  indicates that "the  anticipated  amount to be refunded to
customers is approximately $162 million."

On August  14,  2000,  the  company  initiated  an action in the  United  States
District  Court for the  Northern  District of New York,  entitled  Consolidated
Edison  Company  of New  York,  Inc.  v.  Pataki,  et al.,  seeking  to  prevent
implementation  of the  Indian  Point 2 Law and to have the  Indian  Point 2 Law
declared unconstitutional.

Con Edison of New York believes that the operation,  maintenance  and inspection
practices  related to Indian Point 2 have been prudent.  However,  if the Indian
Point 2 Law is implemented  and determined to be  constitutional,  Con Edison of
New York will not recover  from its  customers  its Indian  Point 2  replacement
power costs. In addition, Con Edison of New York is unable to predict whether or
not any other Indian Point 2-related proceedings, lawsuits, legislation or other
actions,  including the PSC's Outage  Proceeding,  will have a material  adverse
effect on its financial position, results of operations or liquidity.
<PAGE>

                                      - 20 -

NOTE D - FINANCIAL INFORMATION BY BUSINESS SEGMENT




                  CONSOLIDATED EDISON COMPANY OF NEW YORK, INC.
                          SEGMENT FINANCIAL INFORMATION
                                     $000's

                FOR THE THREE MONTHS ENDED JUNE 30, 2000 AND 1999
                                   (UNAUDITED)

<TABLE>
<CAPTION>
                                                 ELECTRIC                                  GAS
                                       ------------------------------          ------------------------------
                                          2000                1999                2000                1999
                                       ----------          ----------          ----------          ----------
<S>                                    <C>                 <C>                 <C>                 <C>
Operating revenues                     $1,429,502          $1,200,079          $  217,380          $  189,701
Intersegment revenues                       2,142               2,698                 734                 615
Depreciation and amortization             113,396             112,573              14,945              15,991
Operating income                          140,064             130,207              29,979              24,620
</TABLE>


<TABLE>
<CAPTION>
                                                   STEAM                                    TOTAL
                                       ------------------------------          ------------------------------
                                          2000                1999                2000                1999
                                       ----------          ----------          ----------          ----------
<S>                                    <C>                 <C>                 <C>                 <C>
Operating revenues                     $   74,600          $   52,878          $1,721,482          $1,442,658
Intersegment revenues                         517                 414               3,393               3,727
Depreciation and amortization               4,618               4,476             132,959             133,040
Operating income                           (4,087)             (2,386)            165,956             152,441
</TABLE>



                  CONSOLIDATED EDISON COMPANY OF NEW YORK, INC.
                          SEGMENT FINANCIAL INFORMATION
                                     $000's

                 FOR THE SIX MONTHS ENDED JUNE 30, 2000 AND 1999
                                   (UNAUDITED)

<TABLE>
<CAPTION>
                                                   ELECTRIC                                 GAS
                                       ------------------------------          ------------------------------
                                          2000                1999                2000                1999
                                       ----------          ----------          ----------          ----------
<S>                                    <C>                 <C>                 <C>                 <C>
Operating revenues                     $2,852,663          $2,410,274          $  611,022          $  571,042
Intersegment revenues                       5,327               5,395               1,437               1,230
Depreciation and amortization             225,612             224,685              29,676              31,703
Operating income                          286,801             277,356             121,303             113,066
</TABLE>


<TABLE>
<CAPTION>
                                                   STEAM                                  TOTAL
                                       ------------------------------          ------------------------------
                                          2000                1999                2000                1999
                                       ----------          ----------          ----------          ----------
<S>                                    <C>                 <C>                 <C>                 <C>
Operating revenues                     $  244,858          $  193,611          $3,708,543          $3,174,927
Intersegment revenues                         934                 827               7,698               7,452
Depreciation and amortization               9,210               8,925             264,498             265,313
Operating income                           26,337              27,316             434,441             417,738
</TABLE>


<PAGE>
                                      - 21 -

                        ORANGE AND ROCKLAND UTILITIES, INC.
                           CONSOLIDATED BALANCE SHEET
                    AS AT JUNE 30, 2000 AND DECEMBER 31, 1999
                                   (UNAUDITED)

<TABLE>
<CAPTION>
                                                                                                     As at
                                                                                     ------------------------------------
                                                                                     June 30, 2000      December 31, 1999
                                                                                     -------------      -----------------
                                                                                          (Thousands of Dollars)
<S>                                                                               <C>                    <C>
ASSETS
UTILITY PLANT, AT ORIGINAL COST

       Electric                                                                    $     661,526             $     653,503
       Gas                                                                               268,770                   263,645
       General                                                                           107,410                   107,661
                                                                                      -----------               -----------
            Total                                                                      1,037,706                 1,024,809
       Less: accumulated depreciation                                                    361,855                   348,060
                                                                                      -----------               -----------
            Net                                                                          675,851                   676,749
       Construction work in progress                                                      27,246                    22,373
                                                                                      -----------               -----------
                                    NET UTILITIY PLANT                                   703,097                   699,122
                                                                                      -----------               -----------

CURRENT ASSETS:
       Cash and cash equivalents                                                          31,845                    78,927
       Customer accounts receivable, less allowance for
            uncollectable accounts of $4,450 and $5,395                                   52,660                    58,586
       Other accounts receivable, less allowance for
            uncollectable accounts of $1,482 and $1,401                                   23,137                    13,333
       Accrued utility revenue                                                            33,610                    24,181
       Gas in storage, at average cost                                                     8,473                    14,856
       Materials and supplies, at average cost                                             4,578                     4,333
       Prepayments                                                                        24,983                    20,761
       Other current assets                                                               20,602                    22,316
                                                                                      -----------               -----------
                                    TOTAL CURRENT ASSETS                                 199,888                   237,293
                                                                                      -----------               -----------

INVESTMENTS
       Non-Utility Property-net of accumulated depreciation and amortization               3,406                     3,415
       Other                                                                                   6                         6
                                                                                      -----------               -----------
                                    TOTAL INVESTMENTS                                      3,412                     3,421
                                                                                      -----------               -----------

DEFERRED CHARGES AND REGULATORY ASSETS
    Regulatory Assets
       Future federal income tax                                                          32,626                    33,115
       Recoverable energy costs                                                           35,371                    18,400
       Deferred revenue taxes                                                              9,457                    10,130
       Deferred pension and other postretirement benefits                                 42,831                    45,328
       Other regulatory assets                                                            48,448                    34,730
                                                                                      -----------               -----------
    Total regulatory assets                                                              168,733                   141,703
    Other deferred charges                                                                13,704                     7,237
                                                                                      -----------               -----------
                                    TOTAL DEFERRED CHARGES AND
                                         REGULATORY ASSETS                                182,437                  148,940
                                                                                      -----------               -----------
                                    TOTAL                                          $    1,088,834            $   1,088,776
                                                                                      ===========               ===========

</TABLE>

The accompanying notes are an integral part of these financial statements.

<PAGE>
                                      - 22 -

                       ORANGE AND ROCKLAND UTILITIES, INC.
                                  BALANCE SHEET
                    AS AT JUNE 30, 2000 AND DECEMBER 31, 1999
                                   (UNAUDITED)

<TABLE>
<CAPTION>
                                                                                                     As at
                                                                                     --------------------------------------
                                                                                     June 30, 2000      December 31, 1999
                                                                                     -------------      -----------------
                                                                                          (Thousands of Dollars)
<S>                                                                               <C>                    <C>
CAPITALIZATION AND LIABILITIES
CAPITALIZATION
    Common stock                                                                   $           5                   $     5
    Additional paid in capital                                                           194,499                    194,499
    Capital stock expense                                                                    -                          (25)
    Retained earnings                                                                    135,080                    137,535
                                                                                      -----------                -----------
TOTAL COMMON SHAREHOLDER'S EQUITY                                                        329,584                    332,014
    Long term debt                                                                       335,601                    281,524
                                                                                      -----------                -----------
                    TOTAL CAPITALIZATION                                                 665,185                    613,538
                                                                                      -----------                -----------

NON-CURRENT LIABILITIES:
    Pension and benefit reserve                                                          69,779                     66,950
    Other noncurrent liabilities                                                         34,888                     34,538
                                                                                      -----------                -----------
                TOTAL NON-CURRENT LIABILITIES                                           104,667                    101,488
                                                                                      -----------                -----------

CURRENT LIABILITIES:
    Long-term debt due within one year                                                   20,000                    120,000
    Notes payable                                                                        19,650                          -
    Accounts payable                                                                     56,182                     54,731
    Accrued federal income and other taxes                                                4,807                          -
    Customer deposits                                                                     6,651                      7,217
    Accrued interest                                                                      6,743                      8,521
    Other current liabilities                                                            53,661                     22,319
                                                                                      -----------                -----------
                  TOTAL CURRENT LIABILITIES                                             167,694                    212,788
                                                                                      -----------                -----------

    DEFERRED CREDITS AND REGULATORY LIABILITIES
    Deferred federal income taxes                                                       114,659                    119,509
    Deferred investment tax credits                                                       7,124                      7,351
    Regulatory liabilities and other deferred credits                                    29,505                     34,102
                                                                                      -----------                -----------
                    TOTAL DEFERRED CREDITS AND                                          151,288                    160,962
                        REGULATORY LIABILITIES                                        -----------                -----------

                           TOTAL                                                  $    1,088,834             $    1,088,776
                                                                                      ===========                ===========


</TABLE>

The accompanying notes are an integral part of these financial statements.



<PAGE>
                                      - 23 -

                       ORANGE AND ROCKLAND UTILITIES, INC.
                          CONSOLIDATED INCOME STATEMENT
                FOR THE THREE MONTHS ENDED JUNE 30, 2000 AND 1999
                                    Unaudited

<TABLE>
<CAPTION>
                                                                     2000                 1999
                                                                  -----------           -----------
                                                                        (Thousands of Dollars)
<S>                                                               <C>                   <C>
OPERATING REVENUES
     Electric                                                     $   112,609           $   115,409
     Gas                                                               31,009                26,485
     Non-utility                                                           21                   543
                                                                  -----------           -----------
               TOTAL OPERATING REVENUES                               143,639               142,437
                                                                  -----------           -----------
OPERATING EXPENSES
     Purchased power                                                   54,435                23,960
     Fuel                                                                  --                10,384
     Gas purchased for resale                                          18,779                14,981
     Other operations                                                  28,829                66,109
     Maintenance                                                        6,584                 9,653
     Depreciation and amortization                                      7,460                 9,733
     Taxes, other than federal income tax                              14,530                21,458
     Federal income tax                                                 2,951                (4,712)
                                                                  -----------           -----------
               TOTAL OPERATING EXPENSES                               133,568               151,566
                                                                  -----------           -----------
OPERATING INCOME                                                       10,071                (9,129)

OTHER INCOME (DEDUCTIONS)
     Investment income                                                  1,280                   233
     Allowance for equity funds used during construction                   85                     6
     Other income and deductions                                          105                (2,022)
     Federal income tax                                                  (479)                  (13)
                                                                  -----------           -----------
            TOTAL OTHER INCOME (DEDUCTIONS)                               991                (1,796)
                                                                  -----------           -----------
Income before interest charges                                         11,062               (10,925)
INTEREST CHARGES
   Interest on long-term debt                                           5,107                 6,734
   Other interest                                                         749                 2,136
   Allowance for borrowed funds used during construction                 (128)                  (70)
                                                                  -----------           -----------
                TOTAL INTEREST CHARGES                                  5,728                 8,800
                                                                  -----------           -----------
NET INCOME (LOSS)                                                       5,334               (19,725)
PREFERRED AND PREFERENCE STOCK REQUIREMENTS                                --                   187
                                                                  -----------           -----------
NET INCOME (LOSS) FOR COMMON STOCK                                $     5,334           $   (19,912)
                                                                  ===========           ===========
ORANGE AND ROCKLAND SALES & DELIVERIES
   Electric - Thousands of killowatthours (Mwhr's)
      O&R Customers                                                 1,212,049             1,197,606
      Off-system sales                                                     --                71,400
                                                                  -----------           -----------
           Total Electric Sales & Deliveries                        1,212,049             1,269,006
                                                                  -----------           -----------
   Gas - Dekatherms (Dth)                                           4,916,392             4,830,683
                                                                  -----------           -----------
</TABLE>


The accompanying notes are an integral part of these financial statements.



<PAGE>
                                      - 24 -


                       ORANGE AND ROCKLAND UTILITIES, INC.
                          CONSOLIDATED INCOME STATEMENT
                   FOR SIX MONTHS ENDED JUNE 30, 2000 AND 1999
                                    UNAUDITED

<TABLE>
<CAPTION>
                                                                     2000                   1999
                                                                  ------------           ------------
                                                                        (Thousands of Dollars)
<S>                                                               <C>                    <C>
OPERATING REVENUES
     Electric                                                     $    217,252           $    224,323
     Gas                                                               108,467                100,553
     Non-utility                                                           116                    616
                                                                  ------------           ------------
                TOTAL OPERATING REVENUES                               325,835                325,492
                                                                  ------------           ------------
OPERATING EXPENSES
     Purchased power                                                   109,171                 43,689
     Fuel                                                                   39                 23,064
     Gas purchased for resale                                           66,926                 56,944
     Other operations                                                   57,740                103,732
     Maintenance                                                        12,732                 18,610
     Depreciation and amortization                                      14,577                 19,221
     Taxes, other than federal income tax                               30,991                 46,255
     Federal income tax                                                  7,801                  2,493
                                                                  ------------           ------------
                TOTAL OPERATING EXPENSES                               299,977                314,008
                                                                  ------------           ------------
OPERATING INCOME                                                        25,858                 11,484

OTHER INCOME (DEDUCTIONS)
     Investment income                                                   4,385                    233
     Allowance for equity funds used during construction                   135                     15
     Other income and deductions                                          (243)                (2,187)
     Federal income tax                                                 (1,370)                   172
                                                                  ------------           ------------
             TOTAL OTHER INCOME (DEDUCTIONS)                             2,907                 (1,767)
                                                                  ------------           ------------
Income before interest charges                                          28,765                  9,717
INTEREST CHARGES
   Interest on long-term debt                                           11,670                 12,801
   Other interest                                                        1,253                  4,544
   Allowance for borrowed funds used during construction                  (202)                  (118)
                                                                  ------------           ------------
                 TOTAL INTEREST CHARGES                                 12,721                 17,227
                                                                  ------------           ------------
NET INCOME (LOSS)                                                       16,044                 (7,510)
PREFERRED AND PREFERENCE STOCK REQUIREMENTS                                 --                    886
                                                                  ------------           ------------
NET INCOME FOR (LOSS) COMMON STOCK                                $     16,044           $     (8,396)
                                                                  ============           ============
ORANGE AND ROCKLAND SALES & DELIVERIES
   Electric - Thousands of killowatthours (Mwhr's)
      O&R Customers                                                  2,403,530              2,355,913
      Off-system sales                                                   2,400                108,230
                                                                  ------------           ------------
            Total Electric Sales & Deliveries                        2,405,930              2,464,143
                                                                  ------------           ------------
   Gas - Dekatherms (Dth)                                           17,230,365             16,781,045
                                                                  ------------           ------------
</TABLE>



The accompanying notes are an integral part of these financial statements.



<PAGE>
                                      - 25 -

                       ORANGE AND ROCKLAND UTILITIES, INC.
                      CONSOLIDATED STATEMENT OF CASH FLOWS
                 FOR THE SIX MONTHS ENDED JUNE 30, 2000 AND 1999
                                    Unaudited

<TABLE>
<CAPTION>
                                                                                   2000               1999
                                                                                 ---------           ---------
                                                                                    (THOUSANDS OF DOLLARS)
<S>                                                                              <C>                 <C>
OPERATING ACTIVITIES
Net Income                                                                       $  16,044           $  (7,510)
PRINCIPAL NON-CASH CHARGES (CREDITS) TO INCOME
Depreciation and amortization                                                       14,577              19,221
Amortization of investment tax credit                                                 (227)             (6,083)
Federal income tax deferred                                                         (4,361)            (17,450)
Common equity component of allowance for funds used during construction               (135)                (15)
Other non-cash changes (debits)                                                      1,351                 577
CHANGES IN ASSETS AND LIABILITIES
Accounts receivable -- net, and accrued utility revenue                             (3,503)             (5,302)
Materials and supplies, including fuel and gas in storage                            6,138               5,721
Prepayments, other receivables and other current assets                            (12,317)              7,455
Deferred recoverable energy costs                                                    2,697              11,688
Accounts payable                                                                     1,451              16,537
Refunds to customers                                                                   800               2,293
Other -- net                                                                        (5,544)             31,544
                                                                                 ---------           ---------
NET CASH FLOWS FROM OPERATING ACTIVITIES                                            16,971              58,676
                                                                                 ---------           ---------
INVESTING ACTIVITIES INCLUDING CONSTRUCTION
Construction expenditures                                                          (20,312)            (18,211)
Net proceeds from the sale of the electric generating assets                            --             339,272
Common equity component of allowance for funds used during construction                135                  15
                                                                                 ---------           ---------
NET CASH FLOWS USED IN INVESTING ACTIVITIES INCLUDING CONSTRUCTION                 (20,177)            321,076
                                                                                 ---------           ---------
FINANCING ACTIVITIES
Issuance of long-term debt                                                          55,000              45,000
Retirement of long-term debt                                                      (100,026)             (2,341)
Retirement of preference and preferred stock                                            --             (43,516)
Retirement of capital lease obligations                                                 --              (1,472)
Short-term debt arrangements                                                        19,650             (82,403)
Common stock dividends                                                             (18,500)            (17,858)
Preferred stock dividends                                                               --                (886)
                                                                                 ---------           ---------
NET CASH FLOWS FROM FINANCING ACTIVITIES INCLUDING DIVIDENDS                       (43,876)           (103,476)
                                                                                 ---------           ---------
NET (DECREASE) INCREASE IN CASH AND TEMPORARY CASH INVESTMENTS                     (47,081)            276,276
CASH AND TEMPORARY CASH INVESTMENTS AT JANUARY 1                                    78,927               6,143
                                                                                 ---------           ---------
CASH AND TEMPORARY CASH INVESTMENTS AT JUNE 30                                      31,846             282,419
                                                                                 ---------           ---------

Cash paid during the period for:

      Interest                                                                      14,811              14,224
      Income Taxes                                                                  27,819              11,000
</TABLE>


 The accompanying notes are an integral part of these financial statements.



<PAGE>




                                     - 26 -

NOTES TO FINANCIAL STATEMENTS - O&R

NOTE A - GENERAL

These footnotes accompany and form an integral part of the interim  consolidated
financial   statements  of  Orange  and  Rockland   Utilities,   Inc.  (O&R),  a
wholly-owned  subsidiary  of  Consolidated  Edison,  Inc.  (Con  Edison).  These
financial  statements  are  unaudited  but, in the opinion of O&R's  management,
reflect all  adjustments  (which  include only normally  recurring  adjustments)
necessary for a fair statement of the results for the interim periods presented.
These  financial  statements  should  be read  together  with  the  audited  O&R
financial statements  (including the notes thereto) included in the combined Con
Edison,  Consolidated  Edison Company of New York, Inc. and O&R Annual Report on
Form 10-K for the year ended December 31, 1999 (the Form 10-K).

NOTE B - ENVIRONMENTAL AND OTHER LITIGATION

ENVIRONMENTAL MATTERS

Hazardous  substances,  such as asbestos,  polychlorinated  biphenyls (PCBs) and
coal tar, have been used or generated in the course of operations of O&R and may
be  present  in  its  facilities  and  equipment.   The  Federal   Comprehensive
Environmental  Response,  Compensation and Liability Act of 1980 (Superfund) and
similar state statutes impose joint and several liability,  regardless of fault,
upon generators of hazardous substances for resulting removal and remedial costs
and environmental  damages.  Liabilities under these laws can be material and in
some instances may be imposed  without regard to fault,  or may imposed for past
acts, even though such past acts may have been lawful at the time they occurred.

At June 30,  2000,  O&R had accrued  $17.3  million as its best  estimate of its
liability for sites as to which it has received  process or notice alleging that
hazardous  substances  generated by the company (and, in most  instances,  other
potentially  responsible  parties)  were  deposited.  There  will be  additional
liability at these sites and other sites,  including the costs of  investigating
and remediating  sites where the company or its predecessors  manufactured  gas.
The total amount of liability is not presently  determinable but may be material
to the company's financial position, results of operations or liquidity.

Under O&R's current gas rate  agreement,  O&R may defer for subsequent  recovery
through  rates the  costs of  investigating  and  remediating  manufactured  gas
sites.   At June 30, 2000,  $18.5  million of such costs had been  deferred as a
regulatory asset.

Suits have been  brought in New York State and  federal  courts  against O&R and
many other defendants, wherein a large number of plaintiffs sought large amounts
of compensatory and punitive damages for deaths and injuries allegedly caused by
exposure  to asbestos at various  premises of the  company.  Many of these suits
have been disposed of without any payment by O&R, or for immaterial amounts. The
amounts  specified in all the remaining  suits total billions of dollars but the
company believes that these amounts are greatly exaggerated,  as were the claims
already disposed of. Based on the information and relevant  circumstances  known
to the company at this time,  it does not  believe  that these suits will have a
material  adverse  effect on its  financial  position,  results of operations or
liquidity.

In May 2000, the New York State Department of Environmental  Conservation  (DEC)
issued  notices of violation to O&R and four other  companies that have operated
coal-fired electric generating  facilities in New York State. The notices allege
violations  of the  federal  Clean Air Act and the New York State  Environmental
Conservation  Law resulting from the alleged  failure of the companies to obtain
DEC permits for physical  modifications  to their  generating  facilities and to
install  air  pollution  control  equipment  that  would  have  reduced  harmful
emissions.  The  notice of  violation  received  by O&R  relates  to the  Lovett
Generating  Station that it sold in June 1999. O&R is unable to predict  whether
or not the  alleged  violations  will  have a  material  adverse  effect  on its
financial position, results of operation or liquidity.


<PAGE>




                                     - 27 -


OTHER LITIGATION

In  1996,  O&R was sued for its  alleged  breach  of an  agreement  to  purchase
electric  capacity and associated  energy from a 4 MW cogeneration  facility and
for an alleged breach of an implied  covenant of good faith. In 1999,  plaintiff
filed a motion for  summary  judgment  and O&R filed a motion in  opposition  of
plaintiff's motion. O&R cannot predict the ultimate outcome of this proceeding.

NOTE C - FINANCIAL INFORMATION BY BUSINESS SEGMENT



                       ORANGE AND ROCKLAND UTILTIES, INC.
                          SEGMENT FINANCIAL INFORMATION
                                     $000's

                 FOR THE THREE MONTHS ENDED JUNE 30, 2000 AND 1999
                                   (UNAUDITED)

<TABLE>
<CAPTION>
                                                  ELECTRIC                                  GAS
                                       ------------------------------          ------------------------------
                                          2000                1999                2000                1999
                                       ----------          ----------          ----------          ----------
<S>                                    <C>                 <C>                 <C>                 <C>
Sales revenues                          $  112,609          $ 115,409            $ 31,009           $  26,485
Intersegment revenues                           2                   3                   -                   5
Depreciation and amortization               5,145               7,966               2,314               1,703
Operating income                           11,151              (6,891)               (914)             (1,311)
</TABLE>


<TABLE>
<CAPTION>
                                                   OTHER                                  TOTAL
                                       ------------------------------          ------------------------------
                                          2000                1999                2000                1999
                                       ----------          ----------          ----------          ----------
<S>                                    <C>                 <C>                 <C>                 <C>
Sales revenues                         $       21           $     543          $  143,639           $ 142,437
Intersegment revenues                           -                   -                   2                   8
Depreciation and amortization                   1                  64               7,460               9,733
Operating income                             (166)               (927)             10,071              (9,129)
</TABLE>

<PAGE>
                                      - 28 -

                       ORANGE AND ROCKLAND UTILTIES, INC.
                          SEGMENT FINANCIAL INFORMATION
                                     $000's

                 FOR THE SIX MONTHS ENDED JUNE 30, 2000 AND 1999
                                   (UNAUDITED)

<TABLE>
<CAPTION>
                                                  ELECTRIC                                  GAS
                                       ------------------------------          ------------------------------
                                          2000                1999                2000                1999
                                       ----------          ----------          ----------          ----------
<S>                                    <C>                 <C>                 <C>                 <C>
Sales revenues                         $ 217,252            $ 224,323           $ 108,467           $ 100,553
Intersegment revenues                          6                    7                   -                  37
Depreciation and amortization              10,108              15,807               4,467               3,320
Operating income                           17,869               3,546               8,379               9,558
</TABLE>



<TABLE>
<CAPTION>
                                                   OTHER                                  TOTAL
                                       ------------------------------          ------------------------------
                                          2000                1999                2000                1999
                                       ----------          ----------          ----------          ----------
<S>                                    <C>                 <C>                 <C>                 <C>

Sales revenues                          $     116            $    616           $ 325,835           $ 325,492
Intersegment revenues                           -                   -                   6                  44
Depreciation and amortization                   2                  94              14,577              19,221
Operating income                             (390)             (1,620)             25,858              11,484
</TABLE>



<PAGE>
                                      - 29 -

NOTE D - RELATED PARTY TRANSACTIONS

Each month O&R is invoiced by Con Edison and its  affiliates for the cost of any
services  rendered  to O&R by Con Edison  and its  affiliates.  These  services,
provided  primarily  by  Con  Edison  of New  York,  include  substantially  all
administrative  support operations such as corporate directorship and associated
ministerial  duties,  accounting,   treasury,  investor  relations,  information
resources,  legal, human resources,  fuel supply and energy management services.
The cost of these  services  totaled $5.6 million during the first six months of
2000.  In addition,  O&R  purchased  $21.3 million of gas from Con Edison of New
York during this period.

O&R provides certain  recurring  services to Con Edison of New York on a monthly
basis,  including cash receipts  processing,  rubber goods testing,  and certain
administrative  services. The cost of these services totaled $3.7 million during
the first six months of 2000.  In addition,  O&R sold $4.9 million of gas to Con
Edison of New York during this period.

NOTE E- RESTATEMENT OF RETAINED EARNINGS

In  July  1999,  O&R's  retained  earnings  as of  the  effective  date  of  its
acquisition by Con Edison was  reclassified to additional  paid in capital.  See
"Acquisition  By Con Edison"  immediately  preceding Note A to the O&R financial
statements included in the Form 10-K. As of June 30, 2000, O&R has reversed this
reclassification.  The amounts shown as additional  paid in capital and retained
earnings on O&R's  December 31, 1999 balance sheet have been restated to reflect
this  reclassification.  This  classification  did not change  the total  common
shareholder's equity for any of the periods presented.


<PAGE>

                                     - 30 -

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

CON EDISON

     Consolidated  Edison, Inc. (Con Edison) is a holding company which operates
only through its subsidiaries and has no material assets other than the stock of
its subsidiaries.  Con Edison's principal  subsidiaries are regulated utilities:
Consolidated  Edison  Company  of New York,  Inc.  (Con  Edison of New York) and
Orange  and  Rockland  Utilities,  Inc.  (O&R).  Con  Edison  also  has  several
unregulated subsidiaries. In October 1999 Con Edison agreed to acquire Northeast
Utilities.

         The following  discussion  and  analysis,  which relates to the interim
consolidated financial statements of Con Edison and its subsidiaries  (including
Con Edison of New York and,  from its date of  acquisition  in July  1999,  O&R)
included in Part I, Item 1 of this report,  should be read in  conjunction  with
Con Edison's  Management's  Discussion  and Analysis of Financial  Condition and
Results of  Operations  (Con  Edison's  10-K MD&A) in Item 7 of the combined Con
Edison,  Con Edison of New York and O&R Annual Reports on Form 10-K for the year
ended December 31, 1999 (File Nos.  1-14514,  1-1217 and 1-4315,  the Form 10-K)
and Con Edison's Management's Discussion and Analysis of Financial Condition and
Results of Operations  (Con Edison's  First Quarter 10-Q MD&A) in Part I, Item 2
of the combined Con Edison,  Con Edison of New York and O&R Quarterly Reports on
Form 10-Q for the quarterly  period ended March 31, 2000 (the First Quarter Form
10-Q).  Reference  is  also  made  to the  notes  to the  Con  Edison  financial
statements in Part I, Item 1 of this report, which notes are incorporated herein
by reference.

LIQUIDITY AND CAPITAL RESOURCES

         Cash and temporary cash  investments and outstanding  commercial  paper
(shown as notes payable on the balance  sheet) at June 30, 2000 and December 31,
1999 were (amounts shown in millions):


                                          June 30, 2000       December 31, 1999
                                           --------------     -----------------

Cash and temporary cash investments           $ 37.7                 $485.1
Commercial paper                              $204.3                 $495.4


         Cash and temporary cash investments, net of commercial paper, decreased
at June 30, 2000,  compared to December 31, 1999,  reflecting reduced cash flows
from operations,  increased construction expenditures by Con Edison of New York,
investment in  nonregulated  electric  generating  facilities,   long-term  debt
repayments and issuances and repurchases of common stock.

         Net cash flows from operating activities during the first six months of
2000  decreased  $111.5  million,  compared  to the  first  six  months of 1999,
principally  because  net cash flows in the 2000  period  reflect the effects of
generation  divestiture,   including  increased  recoverable  energy  costs  and
accounts payable related to the purchase of electricity for customers.

         The  approximately  $1.1 billion of  divestiture  net proceeds that was
held by Con  Edison  of New  York  at  June  30,  1999  was  used in 1999 to pay
dividends to Con Edison (which it used to repay  commercial paper issued to fund
initially its  acquisition  of O&R), to repay  commercial  paper and for the Con
Edison common stock repurchase program.

         Construction expenditures during the first six months of 2000 increased
$120.2 million compared to the first six months of 1999, principally as a result
of  expenditures  related  to  meeting  load  growth on Con Edison of New York's
electric distribution system.
<PAGE>

                                     - 31 -

     In June  2000 an  unregulated  subsidiary  of Con  Edison  purchased  an 80
percent interest in a partnership that owns a 236-MW electric generating unit in
Lakewood,  New Jersey (the  Lakewood  Project) for $96.3  million.  The Lakewood
Project had $187 in long term debt  outstanding  which has been  included in Con
Edison's interim consolidated financial statements.

     In January  2000 Con Edison of New York repaid at maturity  $125 million of
7.6 percent Series 1992 C debentures.  In March 2000 O&R redeemed $80 million of
9.375 percent  Series 1990 A debentures  and $20 million of 6.14 percent  Series
1993 C debentures.

     In May 2000 Con Edison of New York issued $325 million aggregate  principal
amount of 10-year 8.125 percent debentures.  In June 2000 O&R issued $55 million
of 10-year 7.5  percent  debentures.  See  "Liquidity  and  Capital  Resources -
Capital  Resources" in Con Edison's 10-K MD&A and in Con Edison's  First Quarter
10-Q MD&A.

     During the first quarter of 2000, Con Edison  purchased  approximately  1.9
million  shares of its common stock at an aggregate  cost of $60.6  million.  No
shares  were  repurchased  in the second  quarter of 2000.  See  "Liquidity  and
Capital Resources - Stock Repurchases" in Con Edison's 10-K MD&A.

     Con  Edison's   accounts   receivable  -  customer,   less   allowance  for
uncollectible  accounts increased $38.2 million at June 30, 2000,  compared with
year-end  1999,  due  primarily to  increased  billings by  Consolidated  Edison
Solutions, Inc., Con Edison's unregulated energy services subsidiary, reflecting
pricing  based on a higher  wholesale  cost of power.  Con  Edison of New York's
equivalent  number of days of revenue  outstanding  (ENDRO) of customer accounts
receivable  was 27.4 days at June 30, 2000,  compared with 28.8 days at December
31,  1999.  For O&R,  the ENDRO was 35.0 days at June 30,  2000 and 40.4 days at
December  31,  1999.


     Other receivables increased $44.7 million, compared with year-end 1999, due
primarily  to the  inclusion  in Con  Edison's  interim  consolidated  financial
statements of other receivables of the Lakewood Project.

     Prepayments at June 30, 2000 include  cumulative credits to pension expense
for Con Edison of New York of $218.0  million,  compared with $116.0  million at
December 31, 1999. See Note D to the Con Edison financial statements included in
Item 8 of the Form 10-K.

     Recoverable  energy  costs  increased  $183.7  million  at June  30,  2000,
compared  with  year-end  1999,   reflecting  increased  purchased  power  costs
discussed below in "Results of Operations,"  offset,  partially,  by the ongoing
recovery of previously deferred amounts.  See "Recoverable Fuel Costs" in Note A
to the Con Edison financial statements included in Item 8 of the Form 10-K. Also
see Note C to the Con Edison financial  statements included in Part I, Item 1 of
this report (which Note C is incorporated herein by reference).
<PAGE>

                                     - 32 -

         Other  regulatory  assets  increased  $76.2  million at June 30,  2000,
compared  with  year-end  1999,  reflecting  the  deferral  of $49.5  million of
electric capacity costs under contracts with the buyers of the generating assets
sold  by Con  Edison  of New  York  (see  Note I to  the  Con  Edison  financial
statements  included  in Item 8 of the Form  10-K),  and the  deferral  of $19.1
million of Indian Point 2 refueling and maintenance  outage  expenses  discussed
below in "Results of Operations."

         Unfunded other  post-employment  benefit (OPEB)  obligations  (shown as
pension and benefit  reserve on the balance  sheet) were $183.6  million at June
30, 2000,  compared to $143.8 million at December 31, 1999. Con Edison's  policy
is to fund its estimated OPEB costs to the extent  deductible  under current tax
limitations.  O&R's  obligations  also  include a reserve  for its  supplemental
executive  retirement program. See Note E to the Con Edison financial statements
included in Item 8 of the Form 10-K.

         The  accumulated  provision for injuries and damages was $128.1 million
at June 30, 2000,  compared to $119.0 million at December 31, 1999. The increase
resulted primarily from increased workers' compensation claims.

     Accounts payable increased $259.9 million, compared with year-end 1999, due
primarily to the higher costs of power purchases.

     Accrued taxes  increased  $58.3  million,  compared to year-end  1999,  due
principally to timing differences.

     Other  regulatory  liabilities  increased  $61.5  million,   compared  with
year-end 1999, reflecting the accrual of a $30 million liability relating to the
ongoing Indian Point 2 outage (see "Nuclear Generation," below) and the deferral
for future refund to customers of $26.9 million of certain transmission revenues
received  from  the  New  York  Independent  System  Operator,   offset  by  the
recognition  of $22.3  million of  previously  deferred  revenues  relating to a
scheduled Indian Point 2 refueling and maintenance outage.

CAPITAL RESOURCES

         Con  Edison's  ratio of  earnings to fixed  charges  (for the 12 months
ended on the date  indicated) and common equity ratio (as of the date indicated)
were:


                                           June 30, 2000      December 31, 1999
                                           --------------     -----------------

Earnings to fixed charges (SEC basis)           3.77                 4.04
Common equity ratio*                            50.9                 53.1

*  Common shareholders' equity as a percentage of total capitalization

<PAGE>

                                     - 33 -

NORTHEAST UTILITIES

     In April 2000 Con Edison and Northeast Utilities  shareholders approved Con
Edison's pending  acquisition of Northeast  Utilities.  In June 2000 the Federal
Energy  Regulatory  Commission  approved the  acquisition.  Approvals  are still
required by utility regulators in New York, New Hampshire,  Connecticut, and the
Securities and Exchange Commission. In addition, the Hart-Scott-Rodino Antitrust
Improvements Act and the related rules and regulations  prohibit Con Edison from
completing the acquisition  until applicable  waiting periods  requirements have
been  satisfied.  Con Edison is in the process of  responding  to  requests  for
additional  information  from  the  Department  of  Justice.  In June  2000,  to
partially   hedge  its  interest   rate  risk  with  respect  to  financing  the
approximately $1.8 billion cash portion of the merger consideration,  Con Edison
purchased,  for $8.9 million,  cash-settled options expiring in December 2000 on
an aggregate $800 million  notional amount of interest rate swap contracts.  See
"Liquidity and Capital  Resources - Northeast  Utilities Merger" in Con Edison's
10-K MD&A.

REGULATORY MATTERS

         In  April  2000  Con  Edison  of  New  York,   pursuant   to  its  1997
restructuring  agreement,  reduced  its  electric  rates by  approximately  $103
million annually and expanded its electric Retail Choice program to a maximum of
3,000 MW of peak load. See "Regulatory  Matters - Electric" in Con Edison's 10-K
MD&A.

         In May 2000 the installed  capacity market of the New York  Independent
System  Operator  commenced  operations,  and Con  Edison of New York  ended its
purchases of capacity under agreements with the buyers of the generating  assets
it sold in 1999. See Note I to the Con Edison financial  statements in Item 8 of
the Form 10-K.

 NUCLEAR GENERATION

         Con Edison of New York's  Indian  Point 2 nuclear  generating  unit was
shut  down on  February  15,  2000  following  a leak in one of its  four  steam
generators.  See "Nuclear Generation" in Con Edison's 10-K MD&A and Con Edison's
First Quarter Form 10-Q MD&A, the combined Con Edison and Con Edison of New York
Current  Report on Form 8-K,  dated  March 30, 2000 and Note C to the Con Edison
financial  statements included in Part I, Item 1 of this report (which Note C is
incorporated herein by reference).

FINANCIAL MARKET RISKS

         Reference is made to  "Financial  Market  Risks" in Con  Edison's  10-K
MD&A.  At June 30, 2000 neither the fair value of  derivatives  outstanding  nor
potential derivative losses from reasonably possible near-term changes in market
prices  were  material  to the  financial  position,  results of  operations  or
liquidity of the company.

ENVIRONMENTAL MATTERS

         For information concerning potential liabilities of the company arising
from laws and  regulations  protecting  the  environment,  including the Federal
Comprehensive  Environmental  Response,  Compensation  and Liability Act of 1980
(Superfund), see the notes to Con Edison's financial statements included in Part
I, Item 1 of this report and also see Part II, Item 3 of this report.
<PAGE>

                                     - 34 -

RESULTS OF OPERATIONS

Second Quarter of 2000 Compared with Second Quarter of 1999

         Con Edison's net income for common stock for the second quarter of 2000
was $68.7 million or $.33 a share (based upon an average of 212.0 million common
shares outstanding),  compared with $66.4 million or $.30 a share (based upon an
average of 226.0 million  common shares  outstanding)  for the second quarter of
1999.  O&R  financial  results are not included in earnings for periods prior to
its July 1999 acquisition by Con Edison.

Earnings for the quarters ended June 30, 2000 and 1999 were as follows:


        (Millions of dollars)                 2000                  1999
                                              -----                 ----

     Con Edison of New York                   $71.1                $69.2
     O&R                                        5.3                  ---
     Nonregulated subsidiaries                 (4.0)                (2.2)
     Other*                                    (3.7)                (0.6)
     Con Edison                               $68.7                $66.4

   * Includes holding company expenses (including  amortization
     of $2.7 million of goodwill from the  acquisition  of O&R)
     and intercompany eliminations.

         Con Edison's  earnings for the second quarter of 2000,  compared to the
second quarter of 1999,  increased $2.3 million,  reflecting $5.3 million of O&R
earnings,  $23.2  million of  increased  pension  credits (see Note D to the Con
Edison financial  statements  included in Item 8 of the Form 10-K), $5.5 million
of lower employee  benefit  expenses and higher electric sales of $57.3 million
as a result of weather  and the  favorable  economy  for Con Edison of New York,
offset,  partially,  by $27.8 million of increased  distribution expense,  $23.4
million  of rate  reductions  under  Con  Edison  of New  York's  1997  electric
restructuring  plan (see  "Regulatory  Matters - Electric" in Con Edison's  10-K
MD&A and "Regulatory  Matters,"  above),  $11.2 million of expenses incurred and
the accrual of a $15 million  liability  relating to the ongoing  Indian Point 2
outage.

         Con Edison  estimates that the divestiture of most of Con Edison of New
York's electric  generating  capacity in 1999 did not  significantly  impact its
earnings per share in the 2000 period.  The company estimates that reductions in
property taxes,  depreciation  and other operating and  maintenance  costs,  its
acquisition of O&R and the common stock  repurchase  program have  substantially
offset the effects of divestiture.

         A comparison  of the results of operations of Con Edison for the second
quarter of 2000 compared to the second quarter of 1999 follows.
<PAGE>

                                     - 35 -

Three Months Ended June 30, 2000 Compared With Three Months Ended June 30, 1999

(Millions of dollars)            Increases (Decreases)     Increases (Decreases)
                                         Amount                  Percent


Operating revenues                        $562.8                 38.1%

Purchased power - electric and steam       505.2                  (A)

Fuel - electric and steam                  (74.0)                (61.0)

Gas purchased for resale                    86.5                  (A)

Operating revenues less purchased power,    45.1                  4.5
fuel and gas purchased for resale (net
revenues)

Other operations and maintenance            36.3                  9.5

Depreciation and amortization               12.0                  9.0

Taxes, other than federal income tax        (9.6)                (3.4)

Federal income tax                         (15.2)               (31.6)

Operating income                            21.6                 14.5

Other income less deductions and             0.2                  (A)
  related federal income tax

Net interest charges                        19.5                 24.4

Preferred stock dividend                     -                     -
 requirements

Net income for common stock                 $2.3                  3.5%

(A)  Amounts in excess of 100 percent

         A discussion of Con Edison's operating revenues and operating income by
business  segment  follows.  Con Edison's  principal  business  segments are its
electric, gas and steam utility businesses. For additional information about Con
Edison's business segments, see the notes to the Con Edison financial statements
included in Part I, Item 1 of this report.

Electric

         Con Edison's electric  operating revenues in the second quarter of 2000
increased $368.7 million, compared to the second quarter of 1999, reflecting Con
Edison of New York's increased sales volumes and increased purchased power costs
(which it bills to customers  under  PSC-approved  rate  provisions),  offset by
electric  rate  reductions of  approximately  $23.4  million.  The increase also
reflects $112.6 million of O&R electric  operating  revenues.  See Note C to the
Con Edison financial statements included in Part I, Item 1 of this report (which
Note C is incorporated herein by reference).
<PAGE>

                                     - 36 -

         Electricity  sales volume in Con Edison of New York's service territory
increased  5.5  percent in the second  quarter of 2000,  compared  to the second
quarter of 1999. The increase in sales volume reflects the continued strength of
the New York City economy.  After adjusting for variations,  principally weather
and billing days, in each period,  electricity sales volume in Con Edison of New
York's   service   territory   increased   3.7  percent  in  the  2000   period.
Weather-adjusted  sales  represent an estimate of the sales that would have been
made if historical average weather conditions had prevailed.

         Con Edison of New York's purchased power costs increased $359.0 million
in the second  quarter of 2000,  compared  to the second  quarter of 1999,  as a
result  of its  divestiture  of most of its  generating  capacity  in 1999,  the
ongoing  Indian Point 2 outage and  increases  in the price of purchased  power.
Fuel costs decreased $91.0 million as a result of generation divestiture.

     Con Edison's  electric  operating  income  increased  $21.0  million in the
second  quarter of 2000,  compared to the second  quarter of 1999. The principal
components  of the  increase  were:  O&R's  electric  operating  income of $11.1
million and an increase in Con Edison of New York's electric operating income of
$9.9  million,  comprised  primarily of a reduction  in net revenues  (operating
revenues  less fuel and  purchased  power) of $38.5  million,  $11.2  million of
expenses  incurred  and the accrual of a $15 million  liability  relating to the
ongoing Indian Point 2 outage, offset by lower pension expenses ($18.4 million),
lower employee benefit expenses ($4.8 million),  property taxes ($15.8 million),
Federal income tax ($15.8 million) and the deferral of $12.4 million of electric
capacity costs.

     The  increase  in the 2000  period  in  other  operations  and  maintenance
expenses  reflects  certain  expenses  relating  to  Indian  Point 2 and a $37.7
million decrease in expenses relating to Con Edison of New York's other electric
generating  assets (most of which were sold in 1999).  Refueling and maintenance
procedures  that had been planned for a previously  scheduled  April 2000 outage
have been performed as part of the ongoing Indian Point 2 outage.  Refueling and
maintenance  expenses  of $18.7  million  and a like  amount  of  revenues  were
recognized in income in the second quarter of 2000. An additional  $19.1 million
of refueling and  maintenance  expenses have been deferred for recovery  through
rates  during the  remaining  months of the rate year  ending  March  2001.  See
"Outage Accounting" in Note G to the Con Edison financial statements included in
the Form 10-K.  In addition  operation  and  maintenance  expenses in the second
quarter of 2000 reflect $11.2 million of other  expenses  related to the ongoing
Indian Point 2 outage.

Gas

         Con Edison's gas operating  revenues and gas operating income increased
$57.3 million and $4.4  million,  respectively,  in the second  quarter of 2000,
compared  to the  second  quarter  of 1999.  These  changes  reflect  O&R's  gas
operating revenues of approximately $31.0 million and gas operating loss of $0.9
million,  and Con Edison of New York's  increased  gas sales and  transportation
volumes.

         Gas sales and  transportation  volume for Con Edison of New York's firm
customers  increased 7.6 percent in the second quarter of 2000,  compared to the
second quarter of 1999. After adjusting for variations,  principally weather and
billing days, in each period, firm gas sales and transportation volume increased
0.7 percent in the 2000 period.

         A weather-normalization provision that applies to the gas businesses of
Con Edison's utility subsidiaries operating in New York moderates,  but does not
eliminate, the effect of weather-related changes on gas operating income.
<PAGE>

                                     - 37 -

Steam

         Con Edison's  steam  operating  revenues  increased  $21.7  million and
operating income decreased $1.7 million in the second quarter of 2000,  compared
to the second  quarter of 1999.  The higher  revenues  reflect Con Edison of New
York's  increased  fuel and  purchased  power costs (which it bills to customers
under the fuel adjustment clause applicable to steam sales).

         Steam sales  volume  increased  2.3 percent in the 2000  period.  After
adjusting for variations,  principally weather and billing days, in each period,
steam sales volume decreased 0.1 percent in the 2000 period.

Net Interest Charges

         Net  interest  charges  increased  $19.5  million  in the 2000  period,
reflecting  primarily the addition of $5.7 million of O&R debt expense and, with
respect  to Con  Edison of New York,  $5.6  million  of  increased  interest  on
long-term  borrowings,  $1.9 million of increased interest related to short-term
borrowing  and $4.0  million  of  interest  accrued  on the  gain on  generation
divestiture that has been deferred for disposition by the PSC.

Six Months Ended June 30, 2000 Compared with the Six Months Ended June 30, 1999

         Con  Edison's net income for common stock for the six months ended June
30,  2000 was $256.9  million or $1.21 a share  (based  upon an average of 212.4
million  common shares  outstanding),  compared  with $243.0  million or $1.06 a
share (based upon an average of 228.5 million common shares outstanding) for the
six months  ended June 30,  1999.  O&R  financial  results  are not  included in
earnings for periods prior to its July 1999 acquisition by Con Edison.

         Earnings  for the six  months  ended  June 30,  2000  and 1999  were as
follows:


        (Millions of dollars)                 2000                  1999
                                              -----                 ----

     Con Edison of New York                  $249.4               $251.2
     O&R                                       16.0                  ---
     Nonregulated subsidiaries                 (1.7)                (7.9)
     Other*                                    (6.8)                (0.3)
     Con Edison                              $256.9               $243.0


                  *   Includes holding company expenses (including  amortization
                      of $5.5 million of goodwill from the  acquisition  of O&R)
                      and intercompany eliminations.

         Con Edison's earnings for the first six months of 2000, compared to the
first six months of 1999,  increased $13.9 million,  reflecting $16.0 million of
O&R earnings,  $57.0 million of increased pension credits (see Note D to the Con
Edison financial  statements  included in Item 8 of the Form 10-K), $5.0 million
of lower employee  benefits expenses and higher electric sales of $78.0 million
as a result of weather  and the  favorable  economy  for Con Edison of New York,
offset,  partially,  by $40.2 million of increased distribution and transmission
expense,  $47.6 million of rate  reductions  under Con Edison of New York's 1997
electric restructuring plan (see "Regulatory Matters - Electric" in Con Edison's
10-K MD&A and "Regulatory  Matters," above),  $15.2 million of expenses incurred
and the accrual of a $30 million liability  relating to the ongoing Indian Point
2 outage.
<PAGE>

                                     - 38 -

         Con Edison  estimates that the divestiture of most of Con Edison of New
York's electric  generating  capacity in 1999 did not  significantly  impact its
earnings per share in the 2000 period.  The company estimates that reductions in
property taxes,  depreciation  and other operating and  maintenance  costs,  its
acquisition of O&R and the common stock  repurchase  program have  substantially
offset the effects of divestiture.

         A  comparison  of the results of  operations  of Con Edison for the six
months  ended  June 30,  2000  compared  to the six months  ended June 30,  1999
follows.

Six Months Ended June 30, 2000 Compared With Six Months Ended June 30, 1999

(Millions of dollars)            Increases (Decreases)     Increases (Decreases)
                                         Amount                  Percent

Operating revenues                        $1,104.8                33.9%

Purchased power - electric and steam         946.5                 (A)

Fuel - electric and steam                   (105.3)              (44.1)

Gas purchased for resale                     172.3                66.7

Operating revenues less purchased power,      91.3                 4.2
fuel and gas purchased for resale (net
revenues)

Other operations and maintenance              57.8                 7.4

Depreciation and amortization                 22.0                 8.3

Taxes, other than federal income tax         (18.9)               (3.2)

Federal income tax                           (15.5)              (10.4)

Operating income                              45.9                11.2

Other income less deductions and               0.8                47.7
related federal income tax

Net interest charges                          32.8                20.5

Preferred stock dividend                        -                   -
 requirements

Net income for common stock                  $13.9                 5.7%

      (A)  Amounts in excess of 100 percent

         A discussion of Con Edison's operating revenues and operating income by
business  segment  follows.  Con Edison's  principal  business  segments are its
electric, gas and steam utility businesses. For additional information about Con
Edison's business segments, see the notes to the Con Edison financial statements
included in Part I, Item 1 of this report.
<PAGE>

                                     - 39 -
Electric

         Con Edison's electric  operating revenues for the six months ended June
30, 2000  increased  $687.5 million  compared to the comparable  period of 1999,
reflecting  Con Edison of New  York's  increased  sales  volumes  and  increased
purchased  power costs  (which it bills to  customers  under  PSC-approved  rate
provisions),  offset by electric rate reductions of approximately $47.6 million.
The increase also reflects  $217.3 million of O&R electric  operating  revenues.
See Note C to the Con Edison financial  statements included in Part I, Item 1 of
this report (which Note C is incorporated herein by reference).

         Electricity  sales volume in Con Edison of New York's service territory
increased  4.5 percent for the six months ended June 30,  2000,  compared to the
six months  ended June 30,  1999.  The  increase in sales  volume  reflects  the
continued strength of the New York City economy. After adjusting for variations,
principally  weather and billing days, in each period,  electricity sales volume
in Con Edison of New York's service territory  increased 3.4 percent in the 2000
period.  Weather-adjusted  sales  represent  an estimate of the sales that would
have been made if historical average weather conditions had prevailed.

         Con Edison of New York's purchased power costs increased $693.5 million
in the six months  ended June 30,  2000,  compared to the six months  ended June
30,1999,  as a result of its  divestiture of most of its generating  capacity in
1999,  the ongoing Indian Point 2 outage and increases in the price of purchased
power.   Fuel  costs  decreased   $145.6  million  as  a  result  of  generation
divestiture.

         Con Edison's electric  operating income increased $27.3 million for the
six months ended June 30, 2000 from the  comparable  1999 period.  The principal
components  of the  increase  were:  O&R's  electric  operating  income of $17.9
million and an increase in Con Edison of New York's electric operating income of
$9.4  million,  comprised  primarily of a reduction  in net revenues  (operating
revenues  less fuel and  purchased  power) of $105.5  million,  $15.2 million of
expenses  incurred  and the accrual of a $30 million  liability  relating to the
ongoing Indian Point 2 outage, offset by lower pension expenses ($45.5 million),
employee  benefit  expenses ($4.9  million),  property taxes ($35.7 million),
Federal income tax ($23.5 million) and the deferral of $49.5 million of electric
capacity costs.

     The  increase  in the 2000  period  in  other  operations  and  maintenance
expenses  reflects  certain  expenses  relating  to  Indian  Point 2 and a $71.4
million decrease in expenses relating to Con Edison of New York's other electric
generating  assets (most of which were sold in 1999).  Refueling and maintenance
procedures  that had been planned for a previously  scheduled  April 2000 outage
have been performed as part of the ongoing Indian Point 2 outage.  Refueling and
maintenance  expenses  of $36.7  million  and a like  amount  of  revenues  were
recognized  in  income  in the 2000  period.  An  additional  $19.1  million  of
refueling and maintenance expenses have been deferred for recovery through rates
during the  remaining  months of the rate year ending  March  2001.  See "Outage
Accounting"  in Note G to the Con Edison  financial  statements  included in the
Form 10-K. In addition operation and maintenance  expenses in the second quarter
of 2000 reflect $15.2 million of other  expenses  related to the ongoing  Indian
Point 2 outage.
<PAGE>

                                     - 40 -
Gas

         Con Edison's gas operating  revenues and gas operating income increased
$145.4  million and $16.6 million,  respectively,  for the six months ended June
30, 2000,  compared to the six months ended June 30, 1999. These changes reflect
O&R's gas operating  revenues of approximately  $108.5 million and gas operating
income of approximately $8.4 million, and Con Edison of New York's increased gas
sales and transportation volumes.

         Gas sales and  transportation  volume for Con Edison of New York's firm
customers  increased 4.2 percent in the six months ended June 30, 2000, compared
to the  six  months  ended  June  30,  1999.  After  adjusting  for  variations,
principally  weather  and  billing  days,  in each  period,  firm gas  sales and
transportation volume increased 1.2 percent in the 2000 period.

         A weather-normalization provision that applies to the gas businesses of
Con Edison's utility subsidiaries operating in New York moderates,  but does not
eliminate, the effect of weather-related changes on gas operating income.

Steam

         Con Edison's  steam  operating  revenues  increased  $51.2  million and
operating  income decreased $1.0 million for the six months ended June 30, 2000,
compared to the six months ended June 30, 1999. The higher revenues  reflect Con
Edison of New York's increased fuel and purchased power costs (which it bills to
customers under the fuel adjustment clause applicable to steam sales).

         Steam sales volume increased slightly (0.8 percent) in the 2000 period.
After  adjusting for variations,  principally  weather and billing days, in each
period, steam sales volume decreased 0.7 percent in the 2000 period.

Net Interest Charges

         Net  interest  charges  increased  $32.8  million  in the 2000  period,
reflecting primarily the addition of $12.7 million of O&R debt expense and, with
respect  to Con  Edison of New York,  $6.8  million  of  increased  interest  on
long-term  borrowings,  $7.9 million of increased interest related to short-term
borrowing  and $4.0  million  of  interest  accrued  on the  gain on  generation
divestiture that has been deferred for disposition by the PSC.


<PAGE>


                                     - 41 -

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

CON EDISON OF NEW YORK

         Consolidated  Edison Company of New York, Inc. (Con Edison of New York)
is a regulated  utility that  provides  electric  service to over three  million
customers  and gas  service to over one million  customers  in New York City and
Westchester County. It also provides steam service in parts of Manhattan. All of
the common stock of Con Edison of New York is owned by Consolidated Edison, Inc.
(Con Edison).

         This  discussion and analysis  should be read in  conjunction  with Con
Edison of New York's Management's Discussion and Analysis of Financial Condition
and Results of  Operations  in Item 7 of the combined Con Edison,  Con Edison of
New York and Orange and Rockland  Utilities,  Inc.  (O&R) Annual Reports on Form
10-K for the year ended December 31, 1999 (File Nos. 1-14514, 1-1217 and 1-4315,
the Form 10-K) and Con Edison of New York's Management's Discussion and Analysis
of Financial Condition and Results of Operations (Con Edison of New York's First
Quarter 10-Q MD&A) in Part I, Item 2 of the  combined Con Edison,  Con Edison of
New York and O&R Quarterly  Reports on Form 10-Q for the quarterly  period ended
March 31, 2000 (Con Edison of New York's First Quarter Form 10-Q).  Reference is
also made to the  notes to the  financial  statements  in Part I, Item 1 of this
report, which notes are incorporated herein by reference.

LIQUIDITY AND CAPITAL RESOURCES

         Cash and temporary cash  investments and outstanding  commercial  paper
(shown as notes payable on the balance  sheet) at June 30, 2000 and December 31,
1999 were (amounts shown in millions):


                                          June 30, 2000       December 31, 1999
                                           --------------     -----------------

Cash and temporary cash investments           $  1.2                $349.0
Commercial paper                              $109.9                $495.4

         Cash and temporary cash investments, net of commercial paper, decreased
at June 30, 2000,  compared to December 31, 1999,  reflecting reduced cash flows
from  operations,   increased  construction   expenditures  and  long-term  debt
repayments and issuances.

     Net cash flows  from  operating  activities  during the first six months of
2000  decreased  $136.4  million,  compared  to the  first  six  months of 1999,
principally  because  net cash flows in the 2000  period  reflect the effects of
generation  divestiture,   including  increased  recoverable  energy  costs  and
accounts payable related to the purchase of electricity for customers.

         The  approximately  $1.1 billion of  divestiture  net proceeds that was
held by Con  Edison  of New  York  at  June  30,  1999  was  used in 1999 to pay
dividends to Con Edison (which it used to repay  commercial paper issued to fund
initially its  acquisition  of O&R), to repay  commercial  paper and for the Con
Edison common stock repurchase program.

         Construction expenditures during the first six months of 2000 increased
$99.8 million, compared to the first six months of 1999, principally as a result
of  expenditures  related  to  meeting  load  growth on the  company's  electric
distribution system.
<PAGE>


                                     - 42 -

         In January 2000 Con Edison of New York repaid at maturity  $125 million
of 7.6 percent Series 1992 C debentures.

         In May 2000  Con  Edison  of New York  issued  $325  million  aggregate
principal amount of 10-year 8.125 percent debentures. See "Liquidity and Capital
Resources - Capital  Resources" in Con Edison of New York's 10-K MD&A and in Con
Edison of New York's First Quarter 10-Q MD&A.

         Con Edison of New York's accounts receivable - customer, less allowance
for  uncollectible  accounts  decreased $7.5 million at June 30, 2000,  compared
with  year-end  1999.  Con  Edison of New  York's  equivalent  number of days of
revenue  outstanding  (ENDRO) of customer  accounts  receivable was 27.4 days at
June 30, 2000, compared with 28.8 days at December 31, 1999.

         Prepayments  at June 30,  2000  include  cumulative  credits to pension
expense of $218.0  million,  compared with $116.0  million at December 31, 1999.
See Note D to the Con Edison of New York financial statements included in Item 8
of the Form 10-K.

     Recoverable  energy  costs  increased  $166.5  million  at June  30,  2000,
compared  with  year-end  1999,   reflecting  increased  purchased  power  costs
discussed below in "Results of Operations,"  offset,  partially,  by the ongoing
recovery of previously deferred amounts.  See "Recoverable Fuel Costs" in Note A
to the Con Edison of New York  financial  statements  included  in Item 8 of the
Form 10-K.  Also see Note C to the Con Edison of New York  financial  statements
included in Part I, Item 1 of this report (which Note C is incorporated  herein
by reference).


         Deferred charges for divestiture - capacity replacement  reconciliation
increased  $49.5  million  at  June  30,  2000,  compared  with  year-end  1999,
reflecting the deferral of additional  electric  capacity costs under  contracts
with the buyers of the  generating  assets  sold by Con Edison of New York.  See
Note G to the Con Edison of New York financial  statements included in Item 8 of
the Form 10-K.

         Other  regulatory  assets  increased  $15.6  million at June 30,  2000,
compared with year-end 1999,  reflecting the deferral of $19.1 million of Indian
Point 2 refueling and maintenance outage expenses discussed below in "Results of
Operations."

         Unfunded other  post-employment  benefit (OPEB)  obligations  (shown as
pension and benefit  reserve on the balance  sheet) were $113.9  million at June
30, 2000,  compared to $76.8  million at December  31,  1999.  Con Edison of New
York's policy is to fund its estimated OPEB costs to the extent deductible under
current  tax  limitations.  See Note E to the Con  Edison of New York  financial
statements included in Item 8 of the Form 10-K.

         The  accumulated  provision for injuries and damages was $119.6 million
at June 30, 2000,  compared to $110.1 million at December 31, 1999. The increase
resulted primarily from increased workers' compensation claims.

     Accounts payable increased $209.2 million, compared with year-end 1999, due
primarily to the higher costs of power purchases.

     Accrued taxes  increased  $46.8  million,  compared to year-end  1999,  due
principally to timing differences.


<PAGE>


                                     - 43 -

         Other  regulatory  liabilities  increased $66.1 million,  compared with
year-end 1999, reflecting the accrual of a $30 million liability relating to the
ongoing  outage at Indian  Point 2 (see  "Nuclear  Generation,"  below)  and the
deferral for future refund to customers of $26.9 million of certain transmission
revenues received from the New York Independent  System Operator,  offset by the
recognition  of $22.3  million of  previously  deferred  revenues  relating to a
scheduled Indian Point 2 refueling and maintenance outage.

CAPITAL RESOURCES

         Con Edison of New York's ratio of earnings to fixed charges (for the 12
months  ended on the date  indicated)  and common  equity  ratio (as of the date
indicated) were:

                                          June 30, 2000       December 31, 1999
                                           --------------     -----------------

Earnings to fixed charges (SEC basis)          3.91                  4.17
Common equity ratio*                           48.5                  49.4

*  Common shareholders' equity as a percentage of total capitalization

COLLECTIVE BARGAINING AGREEMENTS

           In June 2000 Con Edison of New York concluded a four-year  collective
bargaining agreement with the union representing approximately two-thirds of its
employees.  The  agreement,  among  other  things,  provides  for  general  wage
increases  of 3.0  percent in each of the first  three  years and 2.5 percent in
year four, with a potential 0.5 percent merit increase in each year.

REGULATORY MATTERS

         In  April  2000  Con  Edison  of  New  York,   pursuant   to  its  1997
restructuring  agreement,  reduced  its  electric  rates by  approximately  $103
million annually and expanded its electric Retail Choice program to a maximum of
3,000 MW of peak load. See "Regulatory  Matters - Electric" in Con Edison of New
York's 10-K MD&A.

         In May 2000 the installed  capacity market of the New York  Independent
System  Operator  commenced  operations,  and Con  Edison of New York  ended its
purchases of capacity under agreements with the buyers of the generating  assets
it sold in 1999. See Note I to the Con Edison of New York  financial  statements
in Item 8 of the Form 10-K.

NUCLEAR GENERATION

     Con Edison of New York's  Indian Point 2 nuclear  generating  unit was shut
down on February 15, 2000 following a leak in one of its four steam  generators.
See "Nuclear Generation" in Con Edison of New York's 10-K MD&A and Con Edison of
New York's First Quarter Form 10-Q MD&A,  the combined Con Edison and Con Edison
of New York Current  Report on Form 8-K,  dated March 30, 2000 and Note C to the
Con Edison of New York financial  statements  included in Part I, Item 1 of this
report (which Note C is incorporated herein by reference).

FINANCIAL MARKET RISKS

         Reference  is made to  "Financial  Market  Risks" in Con  Edison of New
York's  10-K  MD&A.  At June 30,  2000  neither  the fair  value of  derivatives
outstanding nor potential  derivative losses from reasonably  possible near-term
changes in market  prices were material to the  financial  position,  results of
operations or liquidity of the company.

ENVIRONMENTAL MATTERS

         For information  concerning potential  liabilities of Con Edison of New
York arising from laws and regulations protecting the environment, including the
Federal Comprehensive Environmental Response,  Compensation and Liability Act of
1980 (Superfund), see the notes to Con Edison of New York's financial statements
included  in Part I, Item 1 of this  report and also see Part II, Item 3 of this
report.
<PAGE>


                                     - 44 -

RESULTS OF OPERATIONS

Second Quarter of 2000 Compared with Second Quarter of 1999

            Con Edison of New York's net income for common  stock for the second
quarter of 2000 was $71.1  million,  compared  with $69.2 million for the second
quarter of 1999. Con Edison of New York's net income  reflects  higher  electric
sales of $57.3  million as a result of weather  and the  favorable  economy  and
increased pension credits of $23.2 million, offset,  partially, by electric rate
reductions of $23.4 million,  increased  distribution expenses of $22.5 million,
$11.2  million of expenses  incurred and the accrual of a $15 million  liability
relating to the ongoing Indian Point 2 outage.

         A comparison of the results of operations of Con Edison of New York for
the second quarter of 2000 compared to the second quarter of 1999 follows.

Three Months Ended June 30, 2000 Compared With Three Months Ended June 30, 1999

(Millions of dollars)            Increases (Decreases)     Increases (Decreases)
                                         Amount                  Percent

Operating revenues                       $278.8                  19.3%

Purchased power - electric and steam      364.6                   (A)

Fuel - electric and steam                 (78.7)                (64.8)

Gas purchased for resale                   25.4                  39.0

Operating revenues less purchased power,  (32.5)                 (3.3)
fuel and gas purchased for resale (net
revenues)

Other operations and maintenance           (4.4)                 (1.2)

Depreciation and amortization              (0.1)                 (0.1)

Taxes, other than federal income tax      (24.2)                 (8.6)

Federal income tax                        (17.3)                (34.9)

Operating income                           13.5                   8.9

Other income less deductions and            0.5                   (A)
related federal income tax

Net interest charges                       12.1                  15.2

Net income for common stock                $1.9                   2.8%

         (A)  Amounts in excess of 100 percent

         A  discussion  of Con  Edison  of New  York's  operating  revenues  and
operating income by business segment follows. Con Edison of New York's principal
business  segments  are its  electric,  gas and steam  utility  businesses.  For
additional information about Con Edison of New York's business segments, see the
notes to the Con Edison of New York  financial  statements  included  in Part I,
Item 1 of this report.
<PAGE>


                                     - 45 -
Electric

         Con  Edison of New York's  electric  operating  revenues  in the second
quarter of 2000  increased  $229.4  million,  compared to the second  quarter of
1999.  The increase  reflects  increased  sales volumes and increased  purchased
power costs (which it bills to customers  under  PSC-approved  rate  provisions)
offset by electric rate reductions of approximately $23.4 million. See Note C to
the Con Edison of New York  financial  statements  included in Part I, Item 1 of
this report (which Note C is incorporated herein by reference).

         Con Edison of New York's electric sales,  excluding  off-system  sales,
for the second quarter of 2000 compared with the second quarter of 1999 were:

<TABLE>
<CAPTION>
                               Millions of Kwhrs.

Description                                        Three Months         Three Months                       Percent
                                                       Ended                Ended           Variation     Variation
                                                  June 30, 2000        June 30, 1999
                                                  --------------       --------------     ------------  ------------
<S>                                                       <C>                   <C>             <C>           <C>
Residential/Religious                                      2,610                 2,469           141           5.7%
Commercial/Industrial                                      4,688                 4,578           110           2.4
Other                                                        104                   121           (17)        (14.0)
                                                   --------------       --------------     ------------  ------------
  Total Full Service Customers                             7,402                 7,168           234           3.3

Retail Choice Customers                                    2,121                 1,817           304          16.7
                                                   --------------       --------------     ------------  ------------
   Sub-total                                               9,523                 8,985           538           6.0
                                                  --------------        --------------     ------------  ------------
NYPA, Municipal Agency and Other Sales                     2,337                 2,256            81           3.6
                                                   --------------       --------------     ------------  ------------
   Total Service Area                                     11,860                11,241           619           5.5%

</TABLE>

         Electricity  sales volume in Con Edison of New York's service territory
increased  5.5  percent in the second  quarter of 2000,  compared  to the second
quarter of 1999. The increase in sales volume reflects the continued strength of
the New York City economy.  After adjusting for variations,  principally weather
and billing days, in each period,  electricity sales volume in Con Edison of New
York's   service   territory   increased   3.7  percent  in  the  2000   period.
Weather-adjusted  sales  represent an estimate of the sales that would have been
made if historical average weather conditions had prevailed.

         Con Edison of New York's purchased power costs increased $359.0 million
in the second  quarter of 2000,  compared  to the second  quarter of 1999,  as a
result of its divestiture of most of its generating capacity in 1999,  increases
in the price of purchased  power,  and the ongoing  Indian Point 2 outage.  Fuel
costs decreased $91.0 million as a result of generation divestiture.

         Con Edison of New  York's  electric  operating  income  increased  $9.9
million in the second quarter of 2000, compared with the second quarter of 1999,
as a  result  of  decreased  net  revenues  (operating  revenues  less  fuel and
purchased  power) of $38.5 million,  $11.2 million of expenses  incurred and the
accrual of a $15  million  liability  relating  to the  ongoing  Indian  Point 2
outage,  offset by reduced pension  expenses ($18.4  million),  employee benefit
expenses ($4.8  million),  property taxes ($15.8 million), Federal income tax
($15.8 million) and the deferral of $12.4 of electric capacity costs.
<PAGE>


                                     - 46 -

     The  increase  in the 2000  period  in  other  operations  and  maintenance
expenses  reflects  certain  expenses  relating  to  Indian  Point 2 and a $37.7
million decrease in expenses relating to Con Edison of New York's other electric
generating  assets (most of which were sold in 1999).  Refueling and maintenance
procedures  that had been planned for a previously  scheduled  April 2000 outage
have been performed as part of the ongoing Indian Point 2 outage.  Refueling and
maintenance  expenses  of $18.7  million  and a like  amount  of  revenues  were
recognized in income in the second quarter of 2000. An additional  $19.1 million
of refueling and  maintenance  expenses have been deferred for recovery  through
rates  during the  remaining  months of the rate year  ending  March  2001.  See
"Outage Accounting" in Note G to the Con Edison of New York financial statements
included in the Form 10-K. In addition operation and maintenance expenses in the
second  quarter of 2000 reflect $11.2 million of other  expenses  related to the
ongoing Indian Point 2 outage.

Gas

         Con Edison of New  York's  gas  operating  revenues  and gas  operating
income  increased  $27.7 million and $5.4 million,  respectively,  in the second
quarter of 2000,  compared to the second quarter of 1999.  These changes reflect
increased gas sales and transportation volumes.

         Gas sales and  transportation  volume for Con Edison of New York's firm
customers  increased 7.6 percent in the second quarter of 2000,  compared to the
1999 period.  After  adjusting for variations,  principally  weather and billing
days, in each period,  firm gas sales and  transportation  volume  increased 0.7
percent in the 2000 period.

         A  weather-normalization  provision  that  applies to Con Edison of New
York's  gas  business  moderates,   but  does  not  eliminate,   the  effect  of
weather-related changes on gas operating income.

Steam

         Con Edison of New  York's  steam  operating  revenues  increased  $21.7
million and operating  income  decreased  $1.7 million in the second  quarter of
2000,  compared  to the second  quarter of 1999.  The  higher  revenues  reflect
increased fuel and purchased  power costs (which it bills to customers under the
fuel adjustment clause applicable to steam sales).

         Steam sales  volume  increased  2.3 percent in the 2000  period.  After
adjusting for variations,  principally weather and billing days, in each period,
steam sales volume decreased 0.1 percent in the 2000 period.

Net Interest Charges

         Net  interest  charges  increased  $12.1  million  in the 2000  period,
reflecting  $5.6 million of increased  interest on  long-term  borrowings,  $1.9
million of increased  interest related to short-term  borrowing and $4.0 million
of interest accrued on the gain on generation divestiture that has been deferred
for disposition by the PSC.
<PAGE>


                                     - 47 -

Six Months Ended June 30, 2000 Compared with the Six Months Ended June 30, 1999

         Con Edison of New York's net income for common stock for the six months
ended June 30, 2000 was $249.4 million, compared with $251.2 million for the six
months ended June 30, 1999. Con Edison of New York's net income  reflects higher
electric sales of $78.0 million as a result of weather and the favorable economy
and  increased  pension  credits  of $57.0  million,  offset  by  electric  rate
reductions of $47.6 million,  increased  distribution expenses of $33.5 million,
$15.2  million of expenses  incurred and the accrual of a $30 million  liability
relating to the ongoing Indian Point 2 outage.

            A comparison  of the results of operations of Con Edison of New York
for the six months ended June 30, 2000 compared to the six months ended June 30,
1999 follows.

Six Months Ended June 30, 2000 Compared With Six Months Ended June 30, 1999

(Millions of dollars)            Increases (Decreases)     Increases (Decreases)
                                         Amount                  Percent

Operating revenues                       $533.6                   16.8%

Purchased power - electric and steam      700.4                    (A)

Fuel - electric and steam                (111.0)                 (46.5)

Gas purchased for resale                   36.9                   17.3

Operating revenues less purchased power,  (92.7)                  (4.3)
fuel and gas purchased for resale (net
revenues)

Other operations and maintenance          (29.7)                  (4.0)

Depreciation and amortization              (0.8)                  (0.3)

Taxes, other than federal income tax      (52.8)                  (9.1)

Federal income tax                        (26.1)                 (16.9)

Operating income                           16.7                    4.0

Other income less deductions and           (0.1)                 (81.6)
related federal income tax

Net interest charges                       18.4                   11.5

Net income for common stock               $(1.8)                  (0.7)%

     (A)  Amounts in excess of 100 percent

         A  discussion  of Con  Edison  of New  York's  operating  revenues  and
operating income by business segment follows. Con Edison of New York's principal
business  segments  are its  electric,  gas and steam  utility  businesses.  For
additional information about Con Edison of New York's business segments, see the
notes to the Con Edison of New York  financial  statements  included  in Part I,
Item 1 of this report.
<PAGE>


                                     - 48 -
Electric

         Con Edison of New York's electric  operating revenues in the six months
ended June 30, 2000 increased  $442.4 million,  compared to the six months ended
June 30, 1999.  The increase  reflects  increased  sales  volumes and  increased
purchased  power costs  (which it bills to  customers  under  PSC-approved  rate
provisions),  offset by electric rate reductions of approximately $47.6 million.
See Note C to the Con Edison of New York financial  statements  included in Part
I, Item 1 of this report (which Note C is incorporated herein by reference).

         Con Edison of New York's electric sales,  excluding  off-system  sales,
for the six months ended June 30, 2000  compared  with the six months ended June
30, 1999 were:

<TABLE>
<CAPTION>
                               Millions of Kwhrs.

Description                                        Six Months           Six Months                        Percent
                                                       Ended                Ended           Variation     Variation
                                                  June 30, 2000        June 30, 1999
                                                  --------------       --------------     ------------  ------------
<S>                                                       <C>                   <C>             <C>           <C>

Residential/Religious                                      5,407                5,193            214           4.1%
Commercial/Industrial                                      9,371               10,120           (749)         (7.4)
Other                                                        240                  261            (21)         (8.1)
                                                   --------------       --------------     ------------  ------------
  Total Full Service Customers                            15,018               15,574           (556)         (3.6)

Retail Choice Customers                                    4,376                2,866           1,510         52.7
                                                   --------------       --------------     ------------  ------------
  Sub-total                                               19,394               18,440             954          5.2
                                                   --------------       --------------     ------------  ------------
NYPA, Municipal Agency and Other Sales                     4,812                4,730              82          1.7
                                                   --------------       --------------     ------------  ------------
   Total Service Area                                     24,206               23,170            1,036         4.5%
</TABLE>



         Electricity  sales volume in Con Edison of New York's service territory
increased  4.5 percent for the six months ended June 30,  2000,  compared to the
six months  ended June 30,  1999.  The  increase in sales  volume  reflects  the
continued strength of the New York City economy. After adjusting for variations,
principally  weather and billing days, in each period,  electricity sales volume
in Con Edison of New York's service territory  increased 3.4 percent in the 2000
period.  Weather-adjusted  sales  represent  an estimate of the sales that would
have been made if historical average weather conditions had prevailed.
<PAGE>


                                     - 49 -

         Con Edison of New York's purchased power costs increased $693.5 million
for the six months  ended June 30,  2000,  compared to the six months ended June
30, 1999, as a result of its  divestiture of most of its generating  capacity in
1999,  increases in the price of purchased power, and the ongoing Indian Point 2
outage.   Fuel  costs  decreased  $145.6  million  as  a  result  of  generation
divestiture.

         Con Edison of New  York's  electric  operating  income  increased  $9.4
million in the six  months  ended June 30,  2000,  compared  with the six months
ended June 30, 1999, as a result of decreased net revenues  (operating  revenues
less fuel and purchased  power) of $105.5 million,  increased  distribution  and
transmission expenses associated with system reinforcement and the relocation of
company facilities to avoid interference with municipal  infrastructure projects
of $33.1  million,  $15.2 million of expenses  incurred and the accrual of a $30
million  liability  relating to the  ongoing  Indian  Point 2 outage,  offset by
reduced  pension  expenses  ($45.5  million),  employee  benefit  expenses ($4.9
million), property taxes ($35.7 million), Federal income tax ($23.5 million) and
the deferral of $49.5 million of electric capacity costs.

     The  increase  in the 2000  period  in  other  operations  and  maintenance
expenses  reflects  certain  expenses  relating  to  Indian  Point 2 and a $71.4
million decrease in expenses relating to Con Edison of New York's other electric
generating  assets (most of which were sold in 1999).  Refueling and maintenance
procedures  that had been planned for a previously  scheduled  April 2000 outage
have been performed as part of the ongoing Indian Point 2 outage.  Refueling and
maintenance  expenses  of $36.7  million  and a like  amount  of  revenues  were
recognized  in  income  in the 2000  period.  An  additional  $19.1  million  of
refueling and maintenance expenses have been deferred for recovery through rates
during the  remaining  months of the rate year ending  March  2001.  See "Outage
Accounting"  in  Note G to the  Con  Edison  of New  York  financial  statements
included in the Form 10-K. In addition operation and maintenance expenses in the
2000  period  reflect  $15.2  million of other  expenses  related to the ongoing
Indian Point 2 outage.

Gas

         Con Edison of New  York's  gas  operating  revenues  and gas  operating
income  increased  $40.0  million and $8.2  million,  respectively,  for the six
months  ended June 30,  2000,  compared to the six months  ended June 30,  1999.
These changes reflect increased gas sales and transportation  volumes and higher
pension credits.
<PAGE>


                                     - 50 -

         Gas sales and  transportation  volume for Con Edison of New York's firm
customers increased 4.2 percent for the six months ended June 30, 2000, compared
to the 1999 period.  After  adjusting for  variations,  principally  weather and
billing days, in each period, firm gas sales and transportation volume increased
1.2 percent in the 2000 period.

         A  weather-normalization  provision  that  applies to Con Edison of New
York's  gas  business  moderates,   but  does  not  eliminate,   the  effect  of
weather-related changes on gas operating income.

Steam

         Con Edison of New  York's  steam  operating  revenues  increased  $51.2
million and  operating  income  decreased  $1.0 million for the six months ended
June 30,  2000,  compared  to the six  months  ended June 30,  1999.  The higher
revenues  reflect  increased  fuel and purchased  power costs (which it bills to
customers under the fuel adjustment clause applicable to steam sales).

         Steam sales volume increased slightly (0.8 percent) in the 2000 period.
After  adjusting for variations,  principally  weather and billing days, in each
period, steam sales volume decreased 0.7 percent in the 2000 period.

Net Interest Charges

         Net  interest  charges  increased  $18.4  million  in the 2000  period,
reflecting  $6.8 million of increased  interest on  long-term  borrowings,  $7.9
million of increased  interest related to short-term  borrowing and $4.0 million
of interest accrued on the gain on generation divestiture that has been deferred
for disposition by the PSC.


<PAGE>

                                     - 51 -


O&R MANAGEMENT'S NARRATIVE ANALYSIS OF THE RESULTS OF OPERATIONS

         Orange and Rockland Utilities, Inc. (O&R), a wholly-owned subsidiary of
Consolidated  Edison,  Inc.  (Con  Edison),  meets the  conditions  specified in
General  Instruction  H to  Form  10-Q  and  is  permitted  to use  the  reduced
disclosure  format  for  wholly-owned  subsidiaries  of  companies,  such as Con
Edison,  that are reporting companies under the Securities Exchange Act of 1934.
Accordingly,  this  O&R  Management's  Narrative  Analysis  of  the  Results  of
Operations is included in this report,  and O&R has omitted from this report the
information  called for by Part I, Item 2 (Management's  Discussion and Analysis
of Financial Condition and Results of Operations).

         O&R's net income for common  stock for the six month  period ended June
30, 2000 was $16.0  million,  $24.4 million higher than the  corresponding  1999
period.  The 1999 period  included  $21.5  million of  non-recurring  merger and
divestiture related charges.  Excluding the impact of these charges,  net income
would  have  increased  $2.9  million  in  the  2000  period,  compared  to  the
corresponding  1999 period.  This increase was due primarily to higher  electric
and gas sales, and reduced operation and maintenance  expenses,  property taxes,
depreciation  expense and interest  charges,  offset,  in part, by electric rate
changes implemented in the third quarter of 1999.

          In June  2000 O&R  concluded  a new  four-year  collective  bargaining
agreement with the union representing approximately 65 percent of its employees.
The O&R  agreement,  among other things,  provides for general wage increases of
3.25 percent in the first year,  and 3.0 percent for the next two years and 3.25
percent in the fourth year of the contract.

         A  comparison  of the results of  operations  of O&R for the six months
ended June 30, 2000 compared to the six months ended June 30, 1999 follows.


(Millions of dollars)            Increases (Decreases)     Increases (Decreases)
                                         Amount                  Percent


Operating revenues                        $0.3                     0.1%

Purchased power - electric                65.5                     (A)

Fuel - electric                          (23.0)                    (A)

Gas purchased for resale                  10.0                    17.5

Operating revenues less purchased power, (52.2)                  (25.8)
fuel and gas purchased for resale (net
revenues)

Other operations and maintenance         (51.9)                  (42.4)

Depreciation and amortization             (4.7)                  (24.2)

Taxes, other than federal income tax     (15.3)                  (33.0)

Federal income tax                         5.3                    (A)

Operating income                          14.4                    (A)

Other income less deductions and           4.6                    (A)
related federal income tax

Net interest charges                      (4.5)                  (26.2)

Preferred stock dividend                  (0.9)                   (A)
requirements

Net income for common stock              $24.4                    (A)

(A)  Amounts in excess of 100 percent

<PAGE>

                                     - 52 -


         A discussion of O&R's operating  revenues by business  segment follows.
O&R's principal  business segments are its electric and gas utility  businesses.
For additional  information about O&R's business segments,  see the notes to the
O&R financial statements included in Part I, Item 1 of this report.

         Electric  operating  revenues  decreased $7.1 million in the six months
ended June 30, 2000,  compared to the  corresponding  1999  period.  In the 1999
period, O&R reduced revenues by $3.2 million to reflect a liability to refund to
customers  this  portion of the  proceeds  of its June 1999  divestiture  of the
company's electric generating assets. Excluding the impact of this non-recurring
accrual,  electric  operating revenues would have decreased $10.3 million in the
2000  period,  compared to the  corresponding  1999  period.  This  decrease was
attributable  primarily to the rate  reductions  implemented  by O&R in July and
August 1999.  These rate  reductions were made as a result of the divestiture by
O&R of its generating  capacity in June 1999 and O&R's acquisition by Con Edison
in July  1999.  See  Note A to the  O&R  financial  statements  in Item 8 of the
combined Con Edison,  Con Edison of New York and O&R Annual  Report on Form 10-K
for the year ended December 31, 1999 (File Nos. 1-14514,  1-1217 and 1-4315, the
Form 10-K).

           O&R's  electric  energy  sales in the six months  ended June 30, 2000
increased 2.0 percent to 2,403,530  megawatt hours (MWhr) from 2,355,913 MWhr in
the corresponding  1999 period.  The increase was due primarily to the continued
strength of the economy. After adjusting for variations, principally weather and
billing  days,  electricity  sales were 2.8 percent  higher in the 2000  period.
Weather-adjusted  sales  represent an estimate of the sales that would have been
made if historical average weather conditions had prevailed.

         O&R's  purchased  power costs  increased  $65.5 million  during the six
months  ended June 30, 2000,  compared to the  corresponding  1999 period.  Fuel
costs  decreased  $23.0  million  in  the  2000  period.  These  variations  are
attributable  primarily to the June 1999  divestiture of the company's  electric
generating assets, higher customer sales, and increases in the cost of purchased
energy.  O&R`s  purchased  power  and fuel  costs  are  recoverable  from  O&R's
customers  under rate  provisions  approved  by the  appropriate  state  utility
regulatory commissions and did not impact earnings in the 2000 or 1999 periods.

         O&R's gas operating  revenues  increased $7.9 million in the six months
ended June 30, 2000, compared to the corresponding 1999 period. The increase was
due  primarily to recovery  from  customers of higher gas costs and increases in
gas sales and  transportation  volumes in the 2000 period.  O&R's total sales of
gas to customers  during the 2000 period totaled  17,230,365  Dekatherms  (Dth),
compared with 16,781,045 Dth during the 1999 period, an increase of 2.7 percent.

         O&R's  revenues  from gas  sales in New York are  subject  to a weather
normalization  clause.  After adjusting for variations,  principally weather and
billing  days,  in each  period,  gas  sales and  transportation  volume to firm
customers  was 0.2  percent  lower  for the 2000  period,  compared  to the 1999
period.

<PAGE>

                                     - 53 -

         O&R's cost of gas purchased for resale increased $10 million in the six
months  ended June 30, 2000,  compared to the  corresponding  1999  period,  due
primarily to higher gas costs and an increase in firm sales for the period.

         O&R's other operation and maintenance  expenses decreased $51.9 million
in the six months  ended  June 30,  2000,  compared  to the  corresponding  1999
period,  due primarily to the June 1999  divestiture  of the company's  electric
generating  assets and operating  efficiencies  resulting from Con Edison's July
1999 acquisition of the company.

         Taxes other than federal income tax decreased  $15.3 million in the six
months  ended June 30, 2000,  compared to the  corresponding  1999  period,  due
primarily to reduced  property taxes resulting from the June 1999 divestiture of
the company's electric generating assets.

         O&R's other income  increased $4.7 million in the six months ended June
30, 2000,  compared to the corresponding  1999 period, due primarily to interest
earned on proceeds  from the June 1999  divestiture  of the  company's  electric
generating  assets.  In  addition,   the  1999  period  included   non-recurring
adjustments  to  expense  related  to O&R's  acquisition  by Con  Edison of $1.3
million.

         O&R's interest  charges  decreased $4.5 million in the six months ended
June 30, 2000, compared to the corresponding 1999 period, due primarily to lower
debt outstanding as a result of repayment of indebtedness  with a portion of the
proceeds from the June 1999  divestiture  of the company's  electric  generating
assets.

         O&R redeemed all  outstanding  shares of its  preferred  stock in April
1999 and  therefore  had no preferred  stock  dividend  requirements  in the six
months ended June 30, 2000.


<PAGE>


                                     - 54 -



ITEM 3            QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET RISK

CON EDISON

For  information  about  Con  Edison's  primary  market  risks  associated  with
activities in derivative financial instruments,  other financial instruments and
derivative commodity  instruments,  see "Financial Market Risks" in Con Edison's
Management's  Discussion  and  Analysis of  Financial  Condition  and Results of
Operations  in Part 1, Item 2 of this  report  and Item 7A of the  combined  Con
Edison,  Con Edison of New York and O&R Annual  Report on Form 10-K for the year
ended December 31, 1999 (the "Form 10-K"),  which  information  is  incorporated
herein by reference.

CON EDISON OF NEW YORK

For information  about Con Edison of New York's primary market risks  associated
with activities in derivative financial instruments, other financial instruments
and derivative commodity instruments, see "Financial Market Risks" in Con Edison
of New York's  Management's  Discussion and Analysis of Financial  Condition and
Results of  Operations  in Part 1, Item 2 of this report and Item 7A of the Form
10-K, which information is incorporated herein by reference.

PART II. OTHER INFORMATION


ITEM 1.           LEGAL PROCEEDINGS

CON EDISON

NORTHEAST UTILITIES SHAREHOLDERS' SUIT

Reference is made to "Northeast Utilities Shareholders Suit" in Part II, Item 1,
Legal  Proceedings  in the combined  Con Edison,  Con Edison of New York and O&R
Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2000 (the
"First Quarter Form 10-Q")

CON EDISON OF NEW YORK

SUPERFUND - ARTHUR KILL TRANSFORMER SITE

Reference is made to "Superfund - Arthur Kill Transformer  Site" in Part I, Item
3, Legal Proceedings of the combined Con Edison,  Con Edison of New York and O&R
Annual  Report on Form 10-K for the year  ended  December  31,  1999 (the  "Form
10-K") and in Part II, Item 1, Legal Proceedings in the First Quarter Form 10-Q.

SUPERFUND - MANUFACTURED GAS SITES

Reference  is made to  "Superfund -  Manufactured  Gas Sites" in Part I, Item 3,
Legal Proceedings of the Form 10-K.

Coal tar and  other  manufactured  gas  plant-related  contamination  have  been
detected in the soil and  groundwater  beneath a Con Edison of New York electric
distribution  substation in White Plains, New York. Based on the limited testing
conducted  to date,  it appears that the  contamination  extends to at least one
neighboring  property and  possibly  others.  Additional  studies are planned to
delineate  the full  extent of the  contamination.  Depending  on the results of
those  studies and the  cleanup  requirements  imposed by the DEC,  the costs of
cleaning up the contamination could exceed $10 million.

SUPERFUND - BCF OIL REFINING SITE


In May 2000, the United States Environmental  Protection Agency (EPA) designated
Con Edison of New York and numerous  other  parties as  potentially  responsible
parties (PRPs) for the BCF Oil Refining Site in Brooklyn, New York. The site was
operated as a waste oil reprocessing  facility from the late 1970's until August
1994,  when the  facility  was  forced to close down  because  its  storage  and
processing  tanks  had  become  contaminated  with  elevated  concentrations  of
polychlorinated  biphenyls (PCBs). In November 1994, the owners of the site sued
Con  Edison  of New  York,  alleging  that its  shipments  of waste oil and oily
wastewater  to the facility  were the source of the high  concentration  of PCBs
that had  contaminated  the facility's  tanks.  The action was dismissed after a
jury verdict in Con Edison of New York's favor.  However,  the facility's  tanks
still  contain  significant  quantities  of  PCB-contaminated  oil  and  EPA has
determined that an emergency  cleanup program  estimated to cost $2.1 million is
required for them.  EPA is currently  attempting to negotiate with the owners of
the facility for the  implementation of the required  emergency cleanup program,
but has  indicated  that it may order PRPs who shipped waste oil to the facility
to implement or to fund the program if the facility owners do not agree to carry
out the program.

<PAGE>

                                     - 55 -

SUPERFUND - MATTIACE PETROCHEMICAL COMPANY SITE


In  July  2000,  Con  Edison  of New  York  was  served  with  an EPA  Superfund
information  request for the Mattiace  Petrochemical  Company  Superfund Site in
Glen Cove,  New York.  According  to EPA,  the  Mattiace  Petrochemical  Company
processed,  blended,  repacked,  and  distributed  solvents at the site from the
mid-1960's  until  1987.  Between  1974  and  1982,   Mattiace   Petrochemical's
affiliate,  the M&M Drum  Company,  cleaned and  refurbished  metal drums at the
site.  Since 1988, EPA has spent in excess of $12 million  conducting  emergency
removal  and  cleanup  work at the site.  Con  Edison  of New York is  presently
investigating  whether it shipped  hazardous  substances to the site.  While the
investigation is not yet complete,  it appears that during the early 1980's, Con
Edison of New York  purchased  naphta and a mineral spirit solvent from Mattiace
Petrochemical and sold scrap drums to Mattiace and M&M Drum.

EMPLOYEES' CLASS ACTION

Reference  is made to  "Employees'  Class  Action"  in  Part  I,  Item 3,  Legal
Proceedings of the Form 10-K. In June 2000, the court  preliminarily  approved a
settlement  agreement between Con Edison of New York and the plaintiffs.  If the
agreement receives final approval,  the company will pay an estimated  aggregate
$10 million  (including  attorneys'  fees) and will take  certain  actions  with
respect  to  its  personnel  practices.  At  June  30,  2000,  the  company  had
approximately $10 million accrued as its liability with respect to this action.

INDIAN POINT 2 OUTAGE LITIGATION

Reference is made to Note C to the Con Edison of New York financial statements
included in Part I, Item 1 of this report.

O&R

SHAREHOLDER LAWSUITS

Reference is made to "Shareholder Lawsuits" in Part I, Item 3, Legal Proceedings
of the Form 10-K and in Part II, Item 1, Legal  Proceedings in the First Quarter
Form 10-Q.  In May 2000,  the trial  court  dismissed  plaintiffs'  actions  and
imposed sanctions on plaintiffs' counsel in Suzanne Hennessy, et al. v. D. Louis
Peoples, et al.

O&R CLEAN AIR ACT PROCEEDING

In May 2000, the New York State Department of Environmental Conservation ("DEC")
issued  notices of violation to O&R and four other  companies that have operated
coal-fired electric generating  facilities in New York State. The notices allege
violations  of the  federal  Clean Air Act and the New York State  Environmental
Conservation  Law resulting from the alleged  failure of the companies to obtain
DEC permits for physical  modifications  to their  generating  facilities and to
install  air  pollution  control  equipment  that  would  have  reduced  harmful
emissions.  The  notice of  violation  received  by O&R  relates  to the  Lovett
Generating  Station that it sold in June 1999. O&R is unable to predict  whether
or not the  alleged  violations  will  have a  material  adverse  effect  on its
financial position, results of operation or liquidity.


<PAGE>

                                     - 56 -

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

CON EDISON

(a) At the Annual  Meeting of  Stockholders  of Con Edison on May 15, 2000,  the
stockholders of Con Edison voted to elect management's nominees for the Board of
Directors,  to ratify and approve the  appointment  of Con Edison's  independent
accountants,  and not to adopt a  stockholder  proposal.  161,785,528  shares of
Common Stock of Con Edison, representing approximately 76.21% of the 212,292,190
shares of Common Stock  outstanding  and  entitled to vote,  were present at the
meeting in person or by proxy.

(b) The name of each nominee for  election as a member of Con Edison's  Board of
Directors and the number of shares voted for or with respect to which  authority
to vote for was withheld are as follows:

                                              VOTES             VOTES
                                              FOR             WITHHELD

E. VIRGIL CONWAY                            159,242,410       2,543,118
PETER W. LIKINS                             159,481,540       2,303,988
RUTH M. DAVIS                               159,243,513       2,542,015
EUGENE R. MCGRATH                           159,439,504       2,346,024
GORDON J. DAVIS                             158,276,938       3,508,590
ELLEN V. FUTTER                             159,413,924       2,371,604
RICHARD A. VOELL                            159,079,447       2,706,081
SALLY HERNANDEZ-PINERO                      159,320,147       2,465,381
STEPHEN R. VOLK                             158,928,813       2,856,715
JOAN S. FREILICH                            159,496,944       2,288,584
MICHAEL J. DEL GIUDICE                      159,475,634       2,309,894
GEORGE CAMPBELL, JR.                        159,431,695       2,353,833

(c) The results of the vote on the appointment of PricewaterhouseCoopers  LLP as
independent  accountants  for Con Edison for 2000 were as  follows:  159,387,727
shares were voted for this  proposal;  1,057,945  shares were voted  against the
proposal; and 1,339,856 shares were abstentions.

(d)  The  following  stockholder-proposed  resolution  was  voted  upon  by  the
stockholders of Con Edison at the Annual Meeting:

"RESOLVED:  That the  shareholders  recommend  that the Board take the necessary
step that Con Edison  specifically  identify by name and corporate  title in all
future proxy statements those executive  officers,  not otherwise so identified,
who are contractually entitled to receive in excess of $250,000 annually as base
salary,  together with whatever other additional  compensation bonuses and other
cash payments were due them."

The results of the vote on this proposal were as follows: 17,246,681 shares were
voted for this  proposal;  108,946,848  shares were voted  against the proposal;
4,900,600 shares were abstentions; and 30,691,399 shares were broker nonvotes

CON EDISON OF NEW YORK

At the Annual Meeting of Stockholders of Con Edison of New York on May 15, 2000,
all  235,488,094  outstanding  shares of common  stock of Con Edison of New York
were voted to elect as members  of Con  Edison of New York's  Board of  Trustees
management's  nominees for the Board of Trustees (George Cambell, Jr., E. Virgil
Conway, Ruth M. Davis, Gordon J. Davis, Joan S. Freilich, Ellen V. Futter, Sally
Hernandez-Pinero,  Peter W.  Likins,  Eugene  R.  McGrath,  Richard  A. Voel and
Stephen   R.   Volk),   and  to  ratify   and   approve   the   appointment   of
PricewaterhouseCoopers  LLP as Con Edison of New York's independent  accountants
for  2000.  All of the  common  stock of Con  Edison of New York is owned by Con
Edison.

<PAGE>




                                      - 57 -



ITEM 6.     EXHIBITS AND REPORTS ON FORM 8-K


(a)   EXHIBITS


CON EDISON

Exhibit 10        The Consolidated Edison, Inc. Discount Stock Plan.

Exhibit 12.1      Statement of computation of Con Edison's ratio of earnings
                  to fixed charges for the twelve-month periods ended
                  June 30, 2000 and 1999.

Exhibit 27.1      Financial Data Schedule for Con Edison.*



CON EDISON OF NEW YORK

Exhibit 12.2       Statement  of  computation  of Con Edison of New York's
                   ratio of earnings to fixed charges for the  twelve-month
                   periods ended June 30, 2000 and 1999.

Exhibit 27.2      Financial Data Schedule for Con Edison of New York.*




O&R

Exhibit 12.3      Statement of  computation  of O&R's ratio of earnings to
                  fixed charges for the twelve-month periods ended June 30, 2000
                  and 1999.

Exhibit 27.3      Financial Data Schedule for O&R.*







-----------
*To the extent provided in Rule 402 of Regulation S-T, this exhibit shall not be
deemed  "filed",  or otherwise  subject to  liabilities,  or be deemed part of a
registration statement.


<PAGE>




                                     - 58 -

(b)      REPORTS ON FORM 8-K

CON EDISON

Con Edison,  along with Con Edison of New York,  filed a combined Current Report
on Form 8-K,  dated March 29,  2000,  reporting  (under Item 5) the  information
contained in the supplement to the joint proxy statement/prospectus  referred to
under "Northeast Utilities Shareholders' Suit" in the discussion of Con Edison's
legal proceedings in Part II, Item 1 of the First Quarter Form 10-Q. Con Edison,
along with O&R, filed a combined Current Report on Form 8-K, dated May 25, 2000,
reporting  (under  Item 5) the  proceeding  referred to under "O&R Clean Air Act
Proceeding" in the  discussion of O&R's legal  proceedings in Part II, Item 1 of
this report.

CON EDISON OF NEW YORK

Con Edison of New York,  along with Con Edison,  filed a combined Current Report
on Form 8-K,  dated March 29,  2000,  reporting  (under Item 5) the  information
contained  in  supplement  to the joint proxy  statement/prospectus  referred to
under "Northeast Utilities Shareholders' Suit" in the discussion of Con Edison's
legal  proceedings in Part II, Item 1 of the First Quarter Form 10-Q. Con Edison
of New York also filed a Current  Report,  dated May 3, 2000,  reporting  (under
Item 5) the issuance and sale of $325 million aggregate  principal amount of its
8 1/8% Debentures, Series 2000 A.

O&R

O&R, along with Con Edison,  filed a combined  Current Report on Form 8-K, dated
May 25, 2000,  reporting  (under Item 5) the  proceeding  referred to under "O&R
Clean Air Act  Proceeding" in the discussion of O&R's legal  proceedings in Part
II, Item 1 of this report. O&R also filed a Current Report, dated June 13, 2000,
reporting  (under  Item  5) the  issuance  and  sale  of $55  million  aggregate
principal amount of its 7.50 % Debentures, Series 2000 A.


<PAGE>



                                     - 59 -


                                   SIGNATURES

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

                                              CONSOLIDATED EDISON, INC.

                                              CONSOLIDATED EDISON COMPANY
                                                    OF NEW YORK, INC.


DATE: August 14, 2000                         By   Joan S. Freilich
                                                   Joan S. Freilich
                                               Executive Vice President, Chief
                                                 Financial Officer and Duly
                                                    Authorized Officer



                                             ORANGE AND ROCKLAND UTILITIES, INC.


DATE: August 14, 2000                         By      Hyman Schoenblum
                                                      Hyman Schoenblum
                                               Vice President, Chief Financial
                                             Officer and Duly Authorized Officer