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Exhibit 99.01

Louisville Gas and Electric Company Cautionary Factors


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

*      Increased competition in the utility industry, including
       effects of: decreasing margins as a result of competitive
       pressures; industry restructuring initiatives;
       transmission system operation and/or administration
       initiatives; recovery of investments made under
       traditional regulation; nature of competitors entering the
       industry; retail wheeling; a new pricing structure; and
       former customers entering the generation market;
*      Changing market conditions and a variety of other factors
       associated with physical energy and financial trading
       activities including, but not limited to, price, basis,
       credit, liquidity, volatility, capacity, transmission,
       currency, interest rate and warranty risks;
*      Risks associated with price risk management strategies
       intended to mitigate exposure to adverse movement in the
       prices of electricity and natural gas on both a global and
       regional basis;
*      Economic conditions including inflation rates and monetary
       fluctuations;
*      Customer business conditions including demand for their
       products or services and supply of labor and materials
       used in creating their products and services;<PAGE>
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*      Financial or regulatory accounting principles or policies
       imposed by the Financial Accounting Standards Board, the
       Securities and Exchange Commission, the Federal Energy
       Regulatory Commission, state public utility commissions,
       state entities which regulate natural gas transmission,
       gathering and processing and similar entities with
       regulatory oversight;
*      Availability or cost of capital such as changes in: 
       interest rates, market perceptions of the utility and
       energy-related industries, the Company or security
       ratings;
*      Factors affecting utility operations such as unusual
       weather conditions; catastrophic weather-related damage;
       unscheduled generation outages, unusual maintenance or
       repairs; unanticipated changes to fossil fuel, or gas
       supply costs or availability due to higher demand,
       shortages, transportation problems or other developments;
       environmental incidents; or electric transmission or gas
       pipeline system constraints;
*      Employee workforce factors including changes in key
       executives, collective bargaining agreements with union
       employees, or work stoppages;
*      Rate-setting policies or procedures of regulatory
       entities, including environmental externalities;
*      Social attitudes regarding the utility, natural gas and
       power industries;
*      Costs and other effects of legal and administrative
       proceedings, settlements, investigations,  claims and
       matters, including but not limited to those described in
       Note 13 of the Notes to Financial Statements of the
       Company's Annual Report on Form 10-K for the year ended
       December 31, 1995, under the caption Commitments and
       Contingencies;
*      Technological developments, changing markets and other
       factors that result in competitive disadvantages and
       create the potential for impairment of existing assets;
*      Other business or investment considerations that may be
       disclosed from time to time in the Company's Securities
       and Exchange Commission filings or in other publicly
       disseminated written documents.

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