SECURITIES AND EXCHANGE COMMISSION

                             WASHINGTON, D.C. 20549

                                    FORM 10-Q

          [ X ]QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE

                         SECURITIES EXCHANGE ACT OF 1934

                For the Quarterly Period Ended September 30, 2000

                         Commission File Number 33-82034

                          INDIANTOWN COGENERATION, L.P.

            (Exact name of co-registrant as specified in its charter)

        Delaware                                     52-1722490
        --------                                     ----------
(State or other jurisdiction of        (I.R.S. Employer Identification Number)
incorporation or organization)



                   Indiantown Cogeneration Funding Corporation

            (Exact name of co-registrant as specified in its charter)

        Delaware                                                52-1889595
        --------                                                ----------
(State or other jurisdiction of        (I.R.S. Employer Identification Number)
incorporation or organization)



                      7500 Old Georgetown Road, 13th Floor
                          Bethesda, Maryland 20814-6161
              (Registrants' address of principal executive offices)


                                 (301)-280-6800
              (Registrants' telephone number, including area code)


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


<PAGE>

                          Indiantown Cogeneration, L.P.
                   Indiantown Cogeneration Funding Corporation

PART I  FINANCIAL INFORMATION                                          Page No.

Item 1  Financial Statements:

        Consolidated Balance Sheets as of September 30, 2000
           (Unaudited) and December 31, 1999..............................1
        Consolidated Statements of Operations for the
           Nine Months Ended September 30, 2000 (Unaudited) and
           September 30, 1999 (Unaudited).................................3
        Consolidated Statements of Cash Flows for the Nine Months
           Ended September 30, 2000 (Unaudited) and September 30, 1999
           (Unaudited)....................................................4

        Notes to Consolidated Financial Statements (Unaudited) ...........5

Item 2  Management's Discussion and Analysis of Financial
        Condition and Results of Operations..............................11

PART II OTHER INFORMATION

Item 1  Legal Proceedings................................................15

Item 5  Other Information................................................17

Item 6  Exhibits and Reports on Form 8K..................................19

Signatures...............................................................20


<PAGE>

<TABLE>
<CAPTION>


                                     PART I
                              FINANCIAL INFORMATION

                          Indiantown Cogeneration, L.P.
                           Consolidated Balance Sheets
                 As of September 30, 2000 and December 31, 1999
                 ----------------------------------------------

<S>                                                                         <C>                        <C>
                                                                             September 30,                December 31,
                            ASSETS                                                2000                        1999
---------------------------------------------------------------            -------------------        ---------------------
                                                                              (Unaudited)
CURRENT ASSETS:
     Cash and cash equivalents                                             $          977,391          $         2,416,997
     Accounts receivable-trade                                                     14,331,046                   13,471,985
     Inventories                                                                    1,172,034                    1,146,017
     Prepaids                                                                         864,604                      807,372
     Deposits                                                                          44,450                       44,450
     Investments held by Trustee, including
        restricted funds of $19,211,173 and
        $2,752,669, respectively                                                   26,293,173                    3,283,909
                                                                           -------------------        ---------------------
               Total current assets                                                43,682,698                   21,170,730
                                                                           -------------------        ---------------------

INVESTMENTS HELD BY TRUSTEE,
     restricted funds                                                              14,577,666                   14,501,877

DEPOSITS                                                                              156,413                       80,000

PROPERTY, PLANT & EQUIPMENT:
     Land                                                                           8,582,363                    8,582,363
     Electric and steam generating facilities                                     700,143,380                  698,401,089
     Less accumulated depreciation                                               (76,744,786)                 (65,534,397)
                                                                           -------------------        ---------------------
               Net property, plant & equipment                                    631,980,957                  641,449,055
                                                                           -------------------        ---------------------

FUEL RESERVE                                                                        2,617,094                    1,318,099


DEFERRED FINANCING COSTS, net of
     accumulated amortization of $44,473,073 and
     $43,854,648, respectively
                                                                                   15,713,843                   16,332,268
                                                                           -------------------        ---------------------
               Total assets                                              $        708,728,671       $          694,852,029
                                                                           ===================        =====================

</TABLE>

              The accompanying notes are an integral part of these
                          consolidated balance sheets.

                                       1
<PAGE>

<TABLE>
<CAPTION>


                         Indiantown Cogeneration, L. P.
                           Consolidated Balance Sheets
                 As of September 30, 2000 and December 31, 1999
                 ----------------------------------------------

<S>                                                                <C>                       <C>
                                                                     September 30,               December 31,
LIABILITIES AND PARTNERS' CAPITAL                                         2000                      1999
--------------------------------------------------------------    ---------------------     ----------------------
                                                                      (Unaudited)
CURRENT LIABILITIES:
     Accrued payables/liabilities                                  $    12,371,993           $      7,584,226
     Accrued interest                                                   15,863,028                  2,267,017
     Current portion - First Mortgage Bonds                             11,337,016                 11,533,135
     Current portion lease payable - railcars                              325,697                    308,534
                                                                  ---------------------     ----------------------
               Total current liabilities                                39,897,734                 21,692,912

LONG TERM DEBT:
     First Mortgage Bonds                                              449,138,417                454,708,865
     Tax Exempt Facility Revenue Bonds                                 125,010,000                125,010,000
     Lease payable - railcars                                            4,028,703                  4,275,166
                                                                  ---------------------     ----------------------
               Total long term debt                                    578,177,120                583,994,031


      Reserve-Major Maintenance                                                  -                    920,536
                                                                  ---------------------     ----------------------
               Total liabilities                                       618,074,854                606,607,479
--------------------------------------------------------------    ---------------------     ----------------------
PARTNERS' CAPITAL:
    Toyan Enterprises                                                  27,241,473                  26,517,489
    Palm Power Corporation                                              9,065,380                   8,824,455
    Indiantown Project Investment Partnership                          18,085,437                  17,604,787
    Thaleia                                                            36,261,527                  35,297,819
                                                                  ---------------------     ----------------------
             Total partners' capital                                   90,653,817                  88,244,550
                                                                  ---------------------     ----------------------
             Total liabilities and partners' capital              $   708,728,671           $     694,852,029
             Capital                                              $   721,268,887           $     708,139,691
                                                                  =====================     ======================

</TABLE>

              The accompanying notes are an integral part of these
                          consolidated balance sheets.

                                       2
<PAGE>

<TABLE>
<CAPTION>

                          Indiantown Cogeneration, L.P.
                      Consolidated Statements of Operations
       For the Nine Months Ended September 30, 2000 and September 30, 1999
       -------------------------------------------------------------------
<S>                                                           <C>                            <C>
                                                                 Nine Months Ended             Nine Months Ended
                                                                 September 30, 2000            September 30, 1999
                                                              -------------------------     -------------------------
                                                                    (Unaudited)                    (Unaudited)
Operating Revenues:
     Electric capacity and capacity bonus revenue                      $92,934,747                   $92,722,266
     Electric energy revenue                                            40,999,423                    28,992,289
     Steam revenue                                                          78,669                        93,420
                                                                       -----------                   -----------
         Total operating revenues                                      134,012,839                   121,807,975
                                                                       -----------                   -----------

Cost of Sales:

     Fuel and ash                                                       42,291,534                    29,428,041
     Operating and maintenance                                          13,801,455                    13,674,954
     Depreciation                                                       11,366,169                    11,458,853
                                                                        ----------                    ----------
         Total cost of sales                                            67,459,158                    54,561,848
                                                                        ----------                    ----------

Gross Profit                                                            66,553,681                    67,246,127
                                                                        ----------                    ----------

Other Operating Expenses:
     General and administrative                                          3,719,234                     3,185,472
     Insurance and taxes                                                 4,820,204                     4,871,790
                                                                         ---------                     ---------
         Total other operating expenses                                  8,539,438                     8,057,262
                                                                         ---------                     ---------

Operating Income                                                        58,014,243                    59,188,865
                                                                        ----------                    ----------

Non-Operating Income (Expenses):
     Interest expense                                                  (42,807,244)                  (43,158,654)
     Interest/Other income (expense)                                     1,581,732                     1,389,179
                                                                       ------------                   -----------
         Net non-operating expense                                     (41,225,512)                  (41,769,475)
                                                                       ------------                  ------------

Income before cumulative effect  of
      change in accounting principle                                    16,788,731                    17,419,390

Cumulative effect of change in accounting principle                        920,536                             -
                                                                        ----------                    ----------
Net Income                                                             $17,709,267                   $17,419,390
                                                                       ===========                   ===========

</TABLE>

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

                                       3
<PAGE>
<TABLE>
<CAPTION>


                          Indiantown Cogeneration, L.P.
                      Consolidated Statements of Cash Flows
              For the Nine Months Ended September 30, 2000 and 1999

<S>                                                                       <C>                       <C>
                                                                               Nine Months               Nine Months
                                                                                  Ended                     Ended
                                                                              September 30,             September 30,
                                                                                  2000                      1999
                                                                           --------------------     ----------------------
                                                                               (Unaudited)               (Unaudited)

    CASH FLOWS FROM OPERATING ACTIVITIES:
         Net income                                                        $      17,709,267        $       17,419,390
             Adjustments to reconcile net income to net
                cash provided by operating activities:
                   Depreciation and amortization                                  11,984,594                12,068,885
                   Loss on disposal of equipment                                       1,032                         -
                   Increase in accounts receivable                                  (859,061)               (2,367,946)
                   (Increase)decrease inventories and fuel reserves               (1,325,012)                3,080,027
                   Increase in deposits and prepaids                                (133,645)                 (190,628)
                   Increase in accounts payable, accrued liabilities
                       and accrued interest                                       18,383,778                 7,384,553
                   (Decrease) increase in major maintenance
                       reserve                                                      (920,536)                  306,585
                   Decrease in lease payable                                        (229,300)                 (213,332)
                                                                           --------------------    ----------------------
                           Net cash provided by operating activities              44,611,117                47,487,534
                                                                           --------------------     ----------------------

CASH FLOWS FROM INVESTING ACTIVITIES:
            Purchase of property, plant & equipment                               (1,899,103)               (1,385,831)
            Increase in investment held by trustee                               (23,085,053)              (25,013,144)
                                                                           --------------------     ----------------------
                           Net cash used in investing activities                 (24,984,156)              (26,398,975)
                                                                           --------------------     ----------------------

    CASH FLOWS FROM FINANCING ACTIVITIES:
             Payment of bonds                                                     (5,766,567)               (4,998,000)
             Capital distributions                                               (15,300,000)              (16,770,000)
             Increase in working capital loan                                              -                         -
                                                                           --------------------     ----------------------
                           Net cash used in financing activities                 (21,066,567)              (21,768,000)
                                                                           --------------------     ----------------------

    CHANGE IN CASH AND CASH EQUIVALENTS                                           (1,439,606)                 (679,441)
    CASH and CASH EQUIVALENTS, beginning of year                                   2,416,997                 2,419,089
                                                                           --------------------     ----------------------
    CASH and CASH EQUIVALENTS, end of period
                                                                           $         977,391        $        1,739,648
                                                                           ====================     ======================
</TABLE>

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

                                       4
<PAGE>

                          Indiantown Cogeneration, L.P.
                   Notes to Consolidated Financial Statements
                            As of September 30, 2000
                                   (Unaudited)

1.   ORGANIZATION AND BUSINESS:
     -------------------------

        Indiantown  Cogeneration,  L.P. (the "Partnership") is a special purpose
Delaware  limited  partnership  formed on October 4, 1991. The  Partnership  was
formed to develop,  construct,  and operate an approximately  330 megawatt (net)
pulverized  coal-fired  cogeneration  facility  (the  "Facility")  located on an
approximately 240 acre site in southwestern Martin County, Florida. The Facility
produces  electricity  for sale to Florida  Power & Light  Company  ("FPL")  and
supplies  steam to Caulkins  Indiantown  Citrus Co.  ("Caulkins")  for its plant
located near the Facility.

        The  original  general  partners  were Toyan  Enterprises  ("Toyan"),  a
California corporation and a wholly owned special purpose indirect subsidiary of
PG&E Generating  Company,  LLC and Palm Power Corporation  ("Palm"),  a Delaware
corporation and a special purpose  indirect  subsidiary of Bechtel  Enterprises,
Inc.  ("Bechtel  Enterprises").  The sole limited  partner was TIFD III-Y,  Inc.
("TIFD"),  a special purpose  indirect  subsidiary of General  Electric  Capital
Corporation ("GECC"). During 1994, the Partnership formed its sole, wholly owned
subsidiary,  Indiantown Cogeneration Funding Corporation ("ICL Funding"), to act
as agent for, and co-issuer  with, the  Partnership in accordance  with the 1994
bond  offering.  ICL  Funding has no  separate  operations  and has only $100 in
assets.

        In 1998, Toyan consummated transactions with DCC Project Finance Twelve,
Inc.  ("PFT"),  whereby  PFT,  through  a new  partnership  (Indiantown  Project
Investment,  L.P.  ("IPILP"))  with Toyan,  became a new general  partner in the
Partnership.  Toyan is the  sole  general  partner  of  IPILP.  Prior to the PFT
transaction,  Toyan  converted some of its general  partnership  interest into a
limited  partnership  interest such that Toyan now directly holds only a limited
partnership interest in the Partnership.  In addition,  Bechtel Enterprises sold
all of the stock of Palm to a wholly  owned  indirect  subsidiary  of  Cogentrix
Energy,  Inc.  ("Cogentrix").  Palm holds a 10% general partner  interest in the
Partnership.

        On June 4, 1999, Thaleia, LLC ("Thaleia"),  a wholly-owned subsidiary of
Palm and indirect  wholly-owned  subsidiary of  Cogentrix,  acquired from TIFD a
19.9%  limited  partner  interest in the  Partnership.  On  September  20, 1999,
Thaleia acquired another 20.0% limited partnership interest from TIFD and TIFD's
membership  on the Board of Control.  On November  19, 1999,  Thaleia  purchased
TIFD's remaining limited partner interest in the Partnership from TIFD.

        The net profits and losses of the  Partnership  are  allocated to Toyan,
Palm,  TIFD,  IPILP,  and Thaleia  (collectively,  the "Partners")  based on the
following ownership percentages:


                                       5

<PAGE>
<TABLE>
<CAPTION>
<S>                    <C>               <C>                  <C>               <C>                   <C>    <C>
                       As of             As of                As of             As of                 As of
                       August 21,        October 20,          June 4,           September 20,         November 24,
                       1998              1998                 1999              1999                  1999
                       ----                                   ----              ----                  ----
        Toyan          30.05%            30.05%               30.05%            30.05%                30.05%
        Palm           10%               10%*                 10%*              10%*                  10%*
        IPILP          19.95%**          19.95%**             19.95%**          19.95%**              19.95%**
        TIFD           40%               40%                  20.1%             .1%                   --
        Thaleia        --                --                   19.9%*            39.9%*                40%*
</TABLE>

*Now beneficially owned by Cogentrix.
**PFT's beneficial  ownership in the Partnership through IPILP was equal to 10%
as of August 21, 1998, and 15% as of November 23, 1998.

        The   changes   in   ownership   were  the   subject   of   notices   of
self-recertification of Qualifying Facility status filed by the Partnership with
the Federal Energy Regulatory  Commission on August 20, 1998, November 16, 1998,
June 4, 1999, September 21, 1999, and November 24, 1999.

        All  distributions  other than  liquidating  distributions  will be made
based on the Partners'  percentage  interest as shown above,  in accordance with
the  project  documents  and at such  times and in such  amounts as the Board of
Control of the Partnership determines.

        The  Partnership  is managed by PG&E  Generating  Company  ("PG&E Gen"),
formerly known as U.S.  Generating  Company,  pursuant to a Management  Services
Agreement  (the  "MSA").  The  Facility is operated by PG&E  Operating  Services
Company  ("PG&E  OSC"),  formerly  known  as U.S.  Operating  Services  Company,
pursuant to an Operation and Maintenance  Agreement (the "O&M Agreement").  PG&E
Gen and  PG&E  OSC are  general  partnerships  wholly-owned  by PG&E  Generating
Company, LLC, an indirect wholly-owned subsidiary of PG&E National Energy Group,
Inc.

2.      FINANCIAL STATEMENTS:
        --------------------

        The  consolidated  balance  sheets as of  September  30,  2000,  and the
consolidated  statements of operations  and cash flows for the nine months ended
September  30, 2000 and 1999,  have been  prepared by the  Partnership,  without
audit and in accordance  with the rules and  regulations  of the  Securities and
Exchange  Commission.  In the opinion of management,  these financial statements
include  all  adjustments  (consisting  only of  normal  recurring  adjustments)
necessary to present  fairly the  financial  position of the  Partnership  as of
September 30, 2000,  and the results of  operations  and cash flows for the nine
months ended September 30, 2000 and 1999.

        The financial  statements and related notes  contained  herein should be
read in conjunction  with the  Partnership's  Annual Report on Form 10-K for the
year ended December 31, 1999.


                                       6
<PAGE>

Investments Held by Trustee

        The investments  held by trustee  represent bond and equity proceeds and
revenue funds held by a bond trustee/disbursement agent and are carried at cost,
which  approximates  market.  All funds are invested in either Nations  Treasury
Fund-Class A or other permitted  investments for longer periods. The Partnership
also maintains  restricted  investments  covering a portion of the Partnership's
debt as required by the financing documents. The proceeds include $12,501,000 of
restricted  tax-exempt debt service reserve required by the financing  documents
and are classified as a noncurrent asset on the accompanying balance sheets. The
Partnership  maintains  restricted   investments  covering  a  portion  of  debt
principal and interest payable,  as required by the financing  documents.  These
investments  are classified as current assets in the  accompanying  consolidated
balance  sheets.  A qualifying  facility  ("QF") reserve of $2.0 million is also
held in long term assets in the accompanying balance sheets.

Property, Plant and Equipment

        Property, plant and equipment,  which consist primarily of the Facility,
are recorded at actual  cost.  The Facility is  depreciated  on a  straight-line
basis over 35 years,  with a residual  value on the  Facility  approximating  25
percent of the gross Facility costs.

          Other property and equipment are depreciated on a straight-line  basis
over the estimated  economic or service lives of the respective  assets (ranging
from five to seven  years).  Routine  maintenance  and  repairs  are  charged to
expense as incurred.

Change in Accounting Principle

        The Partnership's depreciation is based on the plant being considered as
a single  property  unit.  Certain  components  within  the plant  will  require
replacement  or overhaul  several times within the estimated  life of the plant.
The scheduled major overhaul represented an accrual for anticipated expenditures
for scheduled  significant  replacement and overhaul costs of the Facility.  The
expense was being  recognized  ratably over the scheduled  overhaul cycle of the
related equipment.

        The Securities and Exchange  Commission ("SEC") has recently stated that
it objects to the accrue in advance method for scheduled significant replacement
and  overhaul  costs.  The SEC has  asked  the  Accounting  Standards  Executive
Committee  ("AcSEC") to issue  guidance  related to accounting  for these costs,
which will not include the accrue in advance  method.  Prior to the  issuance of
guidance  from the AcSEC,  the SEC has stated  that it will allow  companies  to
recognize  the change from accrue in advance as a cumulative  effect of a change
in accounting principle.  The Partnership has, therefore,  changed its method of
accounting  for  scheduled  major  overhaul  to  the  as  incurred  method.  The
Partnership  has  recognized  a  cumulative  effect  of a change  in  accounting
principle  of  $920,536  in its  financial  statements  for  the  period  ending
September 30, 2000.

New Accounting Pronouncement

        In June 1998, the Financial  Accounting  Standards Board issued SFAS No.
133,  "Accounting  for Derivative  Instruments  and Hedging  Activities"  ("SFAS
133").  SFAS 133

                                       7
<PAGE>

established  accounting  and  reporting  standards for  derivative  instruments,
including certain derivative  instruments  embedded in other contracts,  and for
hedging   activities.   It  requires  that  entities  recognize  all  derivative
instruments  as either  assets or  liabilities  in the  statement  of  financial
position and measure those instruments at fair value. If certain  conditions are
met, a derivative may be specifically  designated as (a) a hedge of the exposure
to  changes  in  the  fair  value  of a  recognized  asset  or  liability  or an
unrecognized  firm  commitment,  or (b) a hedge of the exposure to variable cash
flows of a forecasted transaction. The Partnership has also entered into certain
other  contracts  that may meet the definition of derivative  instruments  under
SFAS 133. The Partnership is evaluating all contracts to determine the impact on
its financial statements. SFAS 133, as amended, is effective for the Partnership
on January 1, 2001.

3.  DEPOSITS:

        In  1991,  in  accordance  with  the  Planned  Unit  Development  Zoning
Agreement between the Partnership and Martin County,  the Partnership  deposited
$1,000,000 in trust with the Board of County Commissioners of Martin County (the
"PUD  Trustee").  Income  from  this  trust  will be used  solely  for  projects
benefiting  the community of  Indiantown.  On July 23, 2025,  the PUD Trustee is
required to return the deposit to the Partnership.  As of September 30, 2000 and
December  31,  1999,  estimated  present  value of this deposit was $156,413 and
$80,000,  respectively.  The  remaining  balance  has been  included in property
plant, and equipment as part of total construction expenses.


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

        The  following  discussion  should  be  read  in  conjunction  with  the
Consolidated  Financial  Statements  of the  Partnership  and the notes  thereto
included elsewhere in this report.

General

        The Partnership is primarily engaged in the ownership and operation of a
non-utility electric generating facility.  From its inception and until December
21, 1995,  the  Partnership  was in the  development  stage and had no operating
revenues or expenses.  On December 22, 1995 the  Facility  commenced  commercial
operation.  As of September 30, 2000, the Partnership had  approximately  $632.0
million of  property,  plant and  equipment  (net of  accumulated  depreciation)
consisting  primarily of purchased  equipment,  construction  related  labor and
materials,  interest  during  construction,  financing  cost,  and  other  costs
directly  associated with the construction of the Facility.  For the nine months
ended  September  30, 2000,  the  Partnership  had total  operating  revenues of
approximately  $134.0  million,  total operating  costs of  approximately  $76.0
million,  total net interest  expenses of  approximately  $41.2  million,  and a
cumulative effect of change in accounting  principle of $0.9 million,  resulting
in net income of approximately $17.7 million.

        The  Partnership  is engaged in litigation  with FPL, the  Partnership's
primary source of revenue. Under certain circumstances, an adverse ruling in the
litigation  could have a material adverse effect on the  Partnership's  business
and financial  condition.  Please see Part II Item 1, Legal  Proceedings,  for a
description of the  litigation,  and Part II, Item 5, Other  Information,  for a
description  of the  Partnership's  options  to  mitigate  the risk  posed by an
adverse ruling in such litigation. On July 31, 2000, FPL announced that it would
combine with Entergy Corp.  FPL

                                       8
<PAGE>

Group,  Inc. and Entergy Corp. have stated that they will seek to consummate the
merger by late 2001. The combination  remains subject to many  contingencies and
regulatory  approvals and the Partnership can not determine what impact, if any,
such combination would have on the Partnership or its business.

        The  Partnership  has obtained all  material  environmental  permits and
approvals  required as of September 30, 2000, in order to continue the operation
of the Facility.  Certain of these permits and approvals are subject to periodic
renewal. Certain additional permits and approvals will be required in the future
for the continued operation of the Facility. The Partnership is not aware of any
technical  circumstances  that would  prevent the  issuance of such  permits and
approvals or the renewal of currently existing permits.

        The Partnership timely filed its application for a Title V air permit on
May 24, 1996. The permit was issued on October 11, 1999.

Results of Operations

        For the nine months  ending  September  30, 2000 and 1999,  the Facility
achieved an average Capacity Billing Factor of 98.31% and 100.72%, respectively.
This resulted in earning monthly capacity payments aggregating $84.5 million and
$84.3 million and bonuses aggregating $8.4 million and $8.4 million for the nine
months ended  September 30, 2000 and 1999,  respectively.  The Capacity  Billing
Factor measures the overall  availability  of the Facility,  but gives a heavier
weighting to on-peak  availability.  During the nine months ended  September 30,
2000, the Facility was dispatched by FPL and generated 1,782,262  megawatt-hours
compared  to  1,248,743  megawatt-hours  during  the same  period  in 1999.  The
increase  was due to higher oil and gas prices  incurred by FPL during the first
three quarters to generate energy from its facilities. The monthly dispatch rate
for the first nine months of 2000 ranged from 62% to 97%, as compared to a range
of 18% to 88% for the corresponding period in 1999.

        Net  income  for  the  nine  months  ended   September  30,  2000,   was
approximately  $17.7 million compared to the net income of  approximately  $17.4
million  for the  corresponding  period  in the  prior  year.  The $0.3  million
increase is primarily  attributable  to an increase in capacity  revenue of $0.2
million,  a decrease  in net  non-operating  expenses  of $0.6  million,  and an
expense reversal of $0.9 million for a cumulative change in accounting principle
relating to major maintenance costs. This is offset by an increase in net energy
costs of $0.8 million,  higher general and administrative  costs of $0.5 million
primarily for legal fees for the FPL litigation and an increase in operating and
maintenance costs of $0.1 million.




                                       9
<PAGE>


Electric Energy Revenues
------------------------
<TABLE>
<CAPTION>

                                                           For the nine months ended
<S>                                               <C>                        <C>
                                                  September 30, 2000          September 30, 1999
                                                  ------------------          ------------------
Revenues                                          $   134.0 million            $  121.8 million
KWhs                                                  1,782.3                     1,248.7
Average Capacity Billing Factor                       98.31%                      100.72%
Average Dispatch Rate                                 86.23%                      60.88%
</TABLE>


        For the nine months ended  September 30, 2000, the Partnership had total
operating revenues of approximately $134.0 million as compared to $121.8 million
for the  corresponding  period in the prior year. The $12.2 million  increase in
operating  revenue is primarily  due to higher  energy  revenue  resulting  from
higher dispatch by FPL.

        Costs of revenues for the nine months  ended  September  30, 2000,  were
approximately  $67.5  million on sales of  1,782,262  MWhs as  compared to $54.6
million on sales of  1,248,743  MWhs for the  corresponding  period in the prior
year.  This increase is primarily a result of higher fuel and ash costs of $12.9
million resulting from higher dispatch.

        Total other  operating  expenses for the nine months ended September 30,
2000,  were  approximately  $8.5  million  compared to the $8.1 million of total
other  operating  expenses for the  corresponding  period in the prior year. The
$0.4  million  increase is due  primarily to higher  general and  administrative
expenses for legal expenses for the FPL litigation.

        Net interest  expense for the nine months ended  September  30, 2000, of
approximately  $41.2 million  compared to $41.8 million of net interest  expense
for the same period in the prior year.  The December 1999 maturity of Series A-8
and a June 2000  payment on Series  A-9 of the first  mortgage  bonds  decreased
interest  expense by approximately  $344,000.  An increase in interest income of
approximately $193,000 resulted in the net decrease.


Liquidity and Capital Resources

        On  November  22, 1994 the  Partnership  and ICL  Funding  issued  first
mortgage  bonds in an  aggregate  principal  amount of $505  million (the "First
Mortgage Bonds"), $236.6 million of which bear an average interest rate of 9.26%
and $268.4  million of which bear an interest rate of 9.77%.  Concurrently  with
the  Partnership's  issuance  of its First  Mortgage  Bonds,  the Martin  County
Industrial  Development Authority issued $113 million of Industrial  Development
Refunding  Revenue  Bonds  (Series  1994A) which bear an interest rate of 7.875%
(the "1994A Tax Exempt  Bonds").  A second  series of tax exempt  bonds  (Series
1994B) in the approximate amount of $12 million,  which bear an interest rate of
8.05%,  were issued by the Martin  County  Industrial  Development  Authority on
December 20, 1994 (the "1994B Tax Exempt Bonds" and, together with the 1994A Tax
Exempt Bonds,  the "1994 Tax Exempt  Bonds").  The First  Mortgage Bonds and the
1994 Tax Exempt Bonds are hereinafter collectively referred to as the "Bonds."

        Certain proceeds from the issuance of the First Mortgage Bonds were used
to repay $421 million of the  Partnership's  indebtedness and financing fees and
expenses  incurred in

                                       10
<PAGE>


connection with the development and construction of the Facility and the balance
of the  proceeds  were  deposited  in  various  restricted  funds that are being
administered by an independent  disbursement  agent pursuant to trust indentures
and a disbursement agreement.  Funds administered by such disbursement agent are
invested  in  specified  investments.  These  funds  together  with other  funds
available  to the  Partnership  were being used:  (i) to finance  completion  of
construction,  testing,  and initial operation of the Facility;  (ii) to finance
construction interest and contingency;  and (iii) to provide for initial working
capital.

        The  proceeds  of the 1994 Tax  Exempt  Bonds  were used to refund  $113
million principal amount of Industrial  Development  Revenue Bonds (Series 1992A
and Series 1992B) previously issued by the Martin County Industrial  Development
Authority  for the  benefit of the  Partnership,  and to fund,  in part,  a debt
service reserve  account for the benefit of the holders of its tax-exempt  bonds
and to complete construction of certain portions of the Facility.

     The  Partnership's  total borrowings from inception  through  September 30,
2000 were $769  million.  The equity loan of $139 million was repaid on December
26, 1995. As of September 30, 2000,  the  borrowings  included $125 million from
the 1994 Tax Exempt Bonds and all of the available First Mortgage Bond proceeds.
The First Mortgage Bonds have matured as follows:

Series            Aggregate Principal Amount            Date Matured and Paid

A-1                      $4,397,000                       June 15, 1996
A-2                       4,398,000                       December 15, 1996
A-3                       4,850,000                       June 15, 1997
A-4                       4,851,000                       December 15, 1997
A-5                       5,132,000                       June 15, 1998
A-6                       5,133,000                       December 15, 1998
A-7                       4,998,000                       June 15, 1999
A-8                       4,999,000                       December 15, 1999

         The weighted  average interest rate paid by the Partnership on its debt
for the nine months ended  September  30, 2000 and 1999,  was 9.204% and 9.177%,
respectively.

        The  Partnership,  pursuant  to certain  of the  Project  Contracts,  is
required to post letters of credit,  which,  in the aggregate,  will have a face
amount of no more than $65 million. Certain of these letters of credit have been
issued  pursuant to a Letter of Credit and  Reimbursement  Agreement with Credit
Suisse and the remaining  letters of credit will be issued when  required  under
the Project Contracts,  subject to conditions contained in such Letter of Credit
and  Reimbursement  Agreement.  As of September  30, 2000, no drawings have been
made on any of these letters of credit.  The Letter of Credit and  Reimbursement
Agreement  has a term of seven years  subject to extension at the  discretion of
the banks party thereto.

        The Partnership entered into a debt service reserve letter of credit and
reimbursement agreement,  dated as of November 1, 1994, with Banque Nationale de
Paris ("BNP")  pursuant to which a debt service  reserve letter of credit in the
amount of  approximately  $60 million was issued.  This  agreement has a rolling
term of five years,  subject to extension at the  discretion  of the banks party
thereto.  Drawings on the debt service reserve letter of credit became available
on the  Commercial  Operation Date of the Facility to pay principal and interest
on the First Mortgage Bonds, the 1994 Tax Exempt Bonds and interest on any loans
created by  drawings on such debt  service  reserve  letter of credit.  Cash and
other  investments held in the debt service

                                       11
<PAGE>

reserve  account will be drawn on for the Tax Exempt Bonds prior to any drawings
on the debt  service  reserve  letter of credit.  As of September  30, 2000,  no
drawings have been made on the debt service  reserve letter of credit.  In April
2000, BNP merged with Banque Paribas and is now know as BNP Paribas.

        In order to provide for the  Partnership's  working  capital needs,  the
Partnership  entered into a Revolving  Credit Agreement with Credit Suisse dated
as of  November 1, 1994.  This  Agreement  has a term of seven years  subject to
extension at the  discretion of the banks party  thereto.  The revolving  credit
agreement has a maximum  available  amount of $15 million and may be drawn on by
the  Partnership  from time to time.  The  interest  rate is based upon  various
short-term indices at the Partnership's option and is determined  separately for
each draw. As of September 30, 2000,  seventeen  working  capital loans had been
made to the  Partnership  under the working  capital loan facility.  All working
capital loans were repaid.


                                     PART II
                                OTHER INFORMATION

Item 1  LEGAL PROCEEDINGS

Dispute with FPL

          On March 19, 1999, the  Partnership  filed a complaint  against FPL in
the United States District Court for the Middle District of Florida. The lawsuit
stems from a course of action pursued by FPL beginning in the Spring of 1997, in
which FPL purported to exercise its dispatch and control  rights under the Power
Purchase Agreement in a manner which the Partnership believes violated the terms
of the power sales  agreement.  In its complaint,  the Partnership  charges that
such conduct was  deliberately  calculated to cause the Partnership to be unable
to meet the  requirements  to maintain  the  Facility's  status as a  Qualifying
Facility under the Public Utility Regulatory Policies Act of 1978.

        The complaint alleges that FPL took the position that if the Facility is
off-line for any reason,  then FPL is under no  obligation to allow the Facility
to reconnect to FPL's system. The original complaint asserted, however, that the
Partnership  specifically and successfully negotiated for a contractual right to
operate  the  Facility  up to 100 MW  ("Minimum  Load") in order to enable it to
cogenerate  sufficient steam to maintain its Qualifying  Facility status.  While
FPL has not disputed that the Partnership  may maintain  Minimum Load operations
if the  Facility  is  delivering  power when FPL  requests  the  Partnership  to
decommit  the  Facility,  the  complaint  states that FPL has  claimed  absolute
discretion  to deny the  Partnership  permission  to reconnect the Facility with
FPL's system.

        Since the loss of Qualifying  Facility  status may result in an event of
default under the Power Purchase Agreement,  the Partnership must take action to
address  this  matter.   The  Partnership   continues  to  investigate   various
alternatives  to mitigate its QF risk.  These are described under "QF Mitigation
Options" below.

        The  complaint  asserted  causes of action  for (i) FPL's  breach of the
Power  Purchase  Agreement,  (ii) FPL's  anticipatory  repudiation  of the Power
Purchase  Agreement,  (iii) breach of the implied  covenant of good faith,  fair
dealing and  commercial  reasonableness  and (iv) a declaratory  judgment by the
court of the  rights of the  parties  under the Power  Purchase

                                       12
<PAGE>

Agreement.  The  Partnership  seeks (a) a declaratory  ruling that FPL's actions
constitute a breach of the terms of the Power  Purchase  Agreement  and that the
Partnership  has the  absolute  right to operate the  Facility  at Minimum  Load
(except for reasons of safety or system  security) at the rates  provided for in
the Power Purchase Agreement,  (b) injunctive relief preventing FPL from further
violating the Power Purchase Agreement,  (c) compensatory  damages and (d) other
relief as the court may deem appropriate.

        On April 23,  1999,  FPL filed a  responsive  pleading to the  complaint
including a motion to dismiss two of the four  counts  raised in the  complaint,
raising  certain  affirmative  defenses  and  seeking  declaration  that FPL has
unfettered dispatch rights under the Power Purchase Agreement.  On the same day,
FPL also filed an answer to the counts that were not challenged in the motion to
dismiss.  On May 13, 1999, the Partnership filed its response to FPL's motion to
dismiss and request for declaratory judgement. On May 18, 1999, the Court denied
FPL's  Motion to  Dismiss  in its  entirety.  The  Partnership  filed an amended
complaint  that was  accepted on June 17,  1999.  The amended  complaint  simply
consolidated the  Partnership's  claims for breach of contract and breach of the
implied  obligation  of good  faith and fair  dealing  which  was,  in part,  in
response to a recent  federal  court  decision.  FPL moved to dismiss the entire
amended  complaint and the  Partnership  filed its  opposition  papers August 2,
1999.  The Court  granted FPL's motion to dismiss only with respect to the first
count of the  complaint.  The  Partnership  has amended its complaint to address
issues  raised by the Court in its  decision to dismiss  this count.  The second
amended  complaint that was filed on March 21, 2000 is attached as an exhibit to
the  Partnership's  Annual  Report on Form 10-K  filed with the  Securities  and
Exchange  Commission on March 30, 2000. On April 7, 2000,  FPL filed a motion to
dismiss ICL's second amended  complaint and the Partnership filed its opposition
papers  April 21,  2000.  On August 18, 2000 the Court  issued an order  denying
FPL's motion to dismiss the second  amended  complaint and discovery  activities
have resumed while FPL and the  Partnership  attempt to resolve the  litigation.
The Court has also ordered a mediation session. In addition,  a trial period has
been established by the Court in April 2001.

        This summary of the Partnership's  complaint against FPL is qualified in
its  entirety  by the  complaint,  which  was  filed  with the  court in  docket
99-317-CIV-ORL-19C.  This summary does not, nor does it purport to,  include all
of the  material  statements  and  claims  made in the  complaint,  and has been
provided solely for the reader's convenience. This summary is not intended to be
relied upon for any purpose without reference to the complaint.

Item 5  OTHER INFORMATION

QF Mitigation Options

       If the court rules against the  Partnership in the  litigation  with FPL,
the  Facility  could  lose its QF  status,  unless  the  Partnership  is able to
implement  mitigating  action.  Loss of QF  status  would  result in an event of
default  under the Power  Purchase  Agreement  and the  indenture for the Bonds.
Unless cured, such events of default would have a material adverse effect on the
Partnership's business, results of operation and financial condition.

        To  mitigate  the risk of a possible  adverse  ruling by the Court,  the
Partnership  has  analyzed  the  feasibility  of various  options.  The analyses
included the following:

o       providing steam to Caulkins for refrigeration

                                       13
<PAGE>

o       constructing a liquid carbon dioxide production facility to which the
        Facility would supply steam
o       installing distilled water production equipment to which the Facility
        would supply steam
o       providing steam for a facility to dry chicken manure at a nearby farm
        for use as a fertilizer
o       providing steam to Caulkins to dry orange peels for use in cattle feed
o       providing steam to Caulkins for wash-water cooling
o       providing steam or chilled water for water temperature control at a
        nearby fish farm
o       constructing a cold storage food distribution center to which the
        Facility would supply chilled water
o       providing chilled water to a nearby hen house for cooling
o       constructing a lumber kiln to dry wood using steam provided by the
        Facility
o       providing chilled water to a nearby flour mill for temperature control

        The analyses  included an  evaluation  as to whether the steam usage for
these  alternatives would qualify for QF purposes and to determine each option's
feasibility  - whether the option can increase  steam  production on a schedule,
which may include  regulatory  approval,  that would  assure  maintenance  of QF
status at an acceptable cost to the  Partnership.  The Partnership has completed
its  initial  analyses of the  options,  but has not yet  determined  whether to
implement  any option.  The  Partnership  has,  however,  commenced  the lengthy
process of amending its Site  Certification  to allow for a chilled  water plant
and a carbon dioxide facility. The Partnership may defer a decision to implement
any option until a judgment is made in the litigation with FPL. If any option is
implemented,  the Partnership may, subject to the terms of the indenture for the
Bonds,  finance such option with senior secured debt ranking pari passu with the
Bonds.

        No assurance can be given that of any option under  consideration or any
other option will finally be determined  to be feasible or that,  even if one or
more  options  are  determined  to be  feasible,  that  such  option(s)  will be
implemented or will result in assuring the maintenance of QF status.

        Notwithstanding  the 18-day period,  in March of 1999,  during which FPL
prevented   the  Facility  from   reconnecting   to  FPL's  system  and  thereby
cogenerating  qualifying steam, the Partnership  cogenerated steam totaling 6.1%
of  electrical  output in 1999 thereby  exceeding  the  statutorily  required 5%
threshold.

Governmental Approvals

        The  Partnership  has obtained all  material  environmental  permits and
approvals  required,  as of September 30, 2000, in order to continue  commercial
operation of the Facility. Certain of these permits and approvals are subject to
periodic renewal.  Certain  additional permits and approvals will be required in
the future for the continued  operation of the Facility.  The Partnership is not
aware of any  technical  circumstances  that would  prevent the issuance of such
permits  and  approvals  or  the  renewal  of  currently  issued  permits.   The
Partnership  timely  filed its  application  for a Title V air permit on May 24,
1996. The permit was issued on October 11, 1999.

        On  December  22,  1999,  the  Partnership   submitted  to  the  Florida
Department of Environmental  Protection  ("DEP") a request for amendments to the
Site Certification and an application for modifications of the Site Certificate.
The  amendments to the Site  Certification

                                       14
<PAGE>

are being provided to inform DEP of certain changes to the Facility's design and
operation.   The  requests  will  not  require  changes  to  the  Conditions  of
Certification  for the  Facility  and do not involve  significant  environmental
impacts  that  would  require  new  environmental  permits  or  approvals.  Also
submitted was an application for  modifications of the Site  Certificate,  which
describes  other proposed  changes to the Facility  design and  operations.  The
modifications  will require  changes to the  Conditions  of  Certification.  The
requests include  modifications to allow the additions of a carbon dioxide plant
and a chilled water plant,  changes in the cooling water storage pond elevation,
and  modifications  of the  operation  of the  pulverized  coal-fired  boiler to
increase the electric generation output.

        The DEP has proposed to modify the conditions of the Site  Certification
to allow  emergency  discharge of cooling  water and process water to conform to
NPDES Permit Number FL0183750, which was issued on January 19, 2000.

Energy Prices

        In October 1999, FPL filed with the Florida  Public  Service  Commission
its projections for its 2000-2001 "as available"  energy costs (in this context,
"as available"  energy costs reflect actual energy  production  costs avoided by
FPL resulting from the purchase of energy from the Facility and other Qualifying
Facilities). The projections filed by FPL are lower for certain periods than the
energy prices  specified in the Power  Purchase  Agreement  for energy  actually
delivered by the Facility.  At other times,  the  projections  exceed the energy
prices  specified in the Power Purchase  Agreement.  Should FPL's "as available"
energy cost projections  prove to reflect actual rates, FPL may elect,  pursuant
to its  dispatch  and control  rights over the  Facility  set forth in the Power
Purchase  Agreement,  to run the Facility less frequently or at lower loads than
if the Facility's energy prices were lower than the cost of other energy sources
available to FPL. Since capacity payments under the Power Purchase Agreement are
not affected by FPL's dispatch of the Facility and because capacity payments are
expected  by the  Partnership  to cover all of the  Partnership's  fixed  costs,
including debt service,  the  Partnership  currently  expects that, if the filed
projections prove to reflect actual rates, such rates and the resulting dispatch
of the Facility  will not have a material  adverse  effect on the  Partnership's
ability to service its debt.  To the extent the  Facility is not operated by FPL
during Caulkins' processing season (November to June), the Partnership may elect
to run the  Facility  at a  minimum  load  or shut  down  the  Facility  and run
auxiliary  boilers to produce steam for Caulkins in amounts  required  under the
Partnership's  steam  agreement  with  Caulkins.  Such  operations may result in
decreased net operating  income for such periods.  The Partnership  expects that
the decrease, if any, will not be material.  For the nine months ended September
30, 2000, FPL has not requested the  Partnership  to decommit the Facility.  The
Partnership's  election to operate at minimum load has not had a material impact
on the Partnership or its financial  condition  although energy delivered during
such operations is sold at reduced prices.

Debt Service Reserve Account

        As permitted by the Partnership's financing arrangements,  on August 19,
1998, the  Partnership  requested  that the balance in the Debt Service  Reserve
Account be reduced  to the Debt  Service  Reserve  Account  Required  Balance by
reducing the Debt Service  Reserve  Letter of Credit.  On January 11, 1999,  the
reduction  was  approved.  The Debt  Service  Reserve  Account now  contains the
$29,609,840  Debt  Service  Reserve  Letter of Credit  and  $12,501,000  of cash
(available only as a debt service reserve for the Tax Exempt Bonds).

                                       15
<PAGE>

Item 6  EXHIBITS AND REPORTS ON FORM 8-K

        a) Reports on Form 8-K:

               None

        b) Exhibits:

      Exhibit
        No.                                     Description
      -------                                   -----------
        27                                 Financial Data Schedule



                                       16
<PAGE>




                                    SIGNATURE

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

                                               INDIANTOWN COGENERATION, L.P.
                                               (Co-Registrant)


Date:  November 14, 2000                       ________________________
                                               John R. Cooper
                                               Vice President and
                                               Chief Financial Officer




                                               INDIANTOWN COGENERATION FUNDING
                                               CORPORATION
                                               (Co-Registrant)

Date:  November 14, 2000                       ________________________
                                               John R. Cooper
                                               Vice President and
                                               Chief Financial Officer


                                       17