UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                              Washington, DC 20549
                                    FORM 10-Q

            THE REGISTRANT MEETS THE CONDITIONS SET FORTH IN GENERAL
   INSTRUCTION H(1) (a) AND (b) OF FORM 10-Q AND IS THEREFORE FILING THIS FORM
                       WITH THE REDUCED DISCLOSURE FORMAT

          [X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
                         SECURITIES EXCHANGE ACT OF 1934

                  For the quarterly period ended June 30, 1999

          [ ] TRANSITION REPORT PURSUANT TO SECTION 13 OF 15(d) OF THE
                             SECURITIES ACT OF 1934

                        Commission file number: 333-58055

                          PECO Energy Transition Trust
             (Exact name of registrant as specified in its charter)

                 Delaware                                51-0382130
      (State or other jurisdiction of                  (I.R.S. Employer
       incorporation or organization)                 Identification No.)

                      c/o First Union Trust Company, N. A.
                       One Rodney Square, 920 King Street
                           Wilmington, Delaware           19801
               (Address of principal executive offices) (Zip Code)

                                 (302) 888-7532
              (Registrant's telephone number, including area code)

         Indicate by check mark whether the registrant (1) has filed all reports
         required to be filed by Section 13 or 15(d) of the Securities  Exchange
         Act of 1934 during the preceding 12 months (or for such shorter  period
         that the  registrant  was required to file such  reports),  and (2) has
         been subject to such filing requirements for the past 90 days.

                 Yes      X               No
                      ----------               ----------
<PAGE>
                          PART I. FINANCIAL INFORMATION

ITEM 1.           FINANCIAL STATEMENTS

                          PECO ENERGY TRANSITION TRUST
             STATEMENTS OF NET ASSETS AVAILABLE FOR TRUST ACTIVITIES
                              (Millions of Dollars)
<TABLE>
<CAPTION>
                                                                    June 30,      December 31,
                                                                      1999            1998
                                                                --------------------------------
                                                                         (Unaudited)
ASSETS

Current Assets:
<S>                                                               <C>                 <C>
     Cash                                                         $     94.1          $ --
     Current portion of intangible transition property                 139.2            --
                                                                    --------          ----
         Total Current Assets                                          233.3            --

Noncurrent Assets:
     Unamortized Debt Issuance Costs                                    24.2           2.1
     Intangible Transition Property                                  3,919.7            --
                                                                    --------          ----
     TOTAL ASSETS                                                    4,177.2           2.1
                                                                    --------          ----

LIABILITIES

Current Liabilities:
     Due to Related Party, Net                                          70.4           1.9
     Accrued Interest Expense                                           66.5            --
     Accrued Expenses                                                   --             0.2
     Current portion of Transition Bonds                               107.0            --
                                                                    --------          ----
         Total Current Liabilities                                     243.9           2.1

Long-term Debt:
     Transition Bonds                                                3,887.9            --
                                                                    --------          ----
     TOTAL LIABILITIES                                               4,131.8           2.1
                                                                    --------          ----

NET ASSETS AVAILABLE FOR TRUST ACTIVITIES                         $     45.4          $ --
                                                                    ========          ====
</TABLE>


                       See Notes to Financial Statements.

                                       2
<PAGE>
                          PECO ENERGY TRANSITION TRUST
        STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR TRUST ACTIVITIES
                                   (Unaudited)
                              (Millions of Dollars)
<TABLE>
<CAPTION>
                                                               Three Months Ended            Six Months Ended
                                                                    June 30,                     June 30,
                                                                1999        1998 (a)         1999       1998 (a)
ADDITIONS
<S>                                                             <C>           <C>           <C>           <C>
     Contributions by Trust Grantor                             $ -           $ -           $ 20.0        $ -
     ITC Collections                                             74.1           -             74.1          -
     Due From Related Party                                      41.1           -             41.1          -
     Deferred Debt Issuance Costs                                 -             -             23.1          -
     Deferred Discount on Transition Bonds                        -             -              5.4          -
     Intangible Transition Property                               -             -          4,080.2          -
     Other                                                         .3           -               .3          -
                                                            ---------       --------      --------     --------

TOTAL ADDITIONS                                                 115.5           -          4,244.2          -
                                                            ---------       --------      --------     --------

DEDUCTIONS
     Due to Related Party                                          .8           -            109.6          -
     Transition Bonds                                             -             -          4,000.0          -
     Accrued Interest on Transition Bonds                        62.4           -             66.5          -
     Amortization of Debt Issuance Costs                           .8           -               .8          -
     Amortization of Intangible Transition Property              21.3           -             21.3          -
     Amortization of Debt Discount                                -             -               .6          -
                                                            ---------       --------      --------     --------

     TOTAL DEDUCTIONS                                            85.3           -          4,198.8          -
                                                            ---------       --------      --------     --------

CHANGES IN NET ASSETS AVAILABLE FOR TRUST ACTIVITIES             30.2           -             45.4          -
                                                            ---------       --------      --------     --------

NET ASSETS AVAILABLE FOR TRUST ACTIVITES
AT BEGINNING OF PERIOD                                           15.2           -              -            -
                                                            ---------       --------      --------     --------

NET ASSETS AVAILABLE FOR TRUST ACTIVITIES
AT END OF PERIOD                                               $ 45.4         $ -           $ 45.4        $ -
                                                            =========       ========      ========     ========
</TABLE>

(a)  PECO Energy  Transition Trust was formed on June 23, 1998. At inception,  a
     $5,000 contribution was made by the Trust Grantor.


                       See Notes to Financial Statements.

                                       3
<PAGE>
                          PECO ENERGY TRANSITION TRUST
                          NOTES TO FINANCIAL STATEMENTS

1.  NATURE OF OPERATIONS
         PECO  Energy  Transition  Trust  (PETT),  a  statutory  business  trust
established  by PECO Energy Company (PECO Energy) under the laws of the State of
Delaware, was formed on June 23, 1998 pursuant to a trust agreement between PECO
Energy, as grantor,  First Union Trust Company, N.A., as issuer trustee, and two
beneficiary  trustees  appointed by PECO  Energy.  PECO Energy  provides  retail
electric  and  natural  gas  service  to the public in its  traditional  service
territory  and  retail  electric  generation  service  throughout   Pennsylvania
pursuant to Pennsylvania's  Customer Choice Program. PECO Energy also engages in
the wholesale marketing of electricity on a national basis.

         PETT was  organized for the special  purpose of  purchasing  and owning
Intangible  Transition  Property (ITP),  issuing  transition  bonds  (Transition
Bonds), pledging its interest in ITP and other collateral to the bond trustee to
secure the Transition  Bonds,  and performing  activities that are necessary and
suitable to accomplish these purposes.  ITP represents the irrevocable  right of
PECO  Energy,  or  its  successor  or  assignee,  to  collect  a  non-bypassable
Intangible  Transition Charge (ITC) from customers  pursuant to a Qualified Rate
Order (QRO) issued on May 14, 1998 by the Pennsylvania Public Utility Commission
(PUC) in accordance with the Pennsylvania Electricity Generation Customer Choice
and Competition Act (Competition  Act) enacted in Pennsylvania in December 1996.
The QRO  authorizes the ITC to be sufficient to recover up to $4 billion of PECO
Energy's  stranded  costs and an amount  sufficient  to  recover  the  aggregate
principal amount of the Transition  Bonds,  plus an amount sufficient to provide
for any credit enhancement, to fund any reserves and to pay interest, redemption
premiums,  if any,  servicing fees and other expenses relating to the Transition
Bonds.

         PETT's organizational  documents require it to operate in such a manner
that it should not be  consolidated  in the bankruptcy  estate of PECO Energy in
the event PECO Energy becomes subject to such a proceeding, and both PECO Energy
and  PETT  have  treated  the  transfer  of ITP to  PETT  as a  sale  under  the
Competition Act. The Transition Bonds are debt obligations of PETT.

         For financial  reporting and Federal and  Commonwealth  of Pennsylvania
income and franchise tax purposes,  the transfer of ITP to PETT has been treated
as a  financing  arrangement  and not as a sale.  Furthermore,  the  results  of
operations  of PETT will be  consolidated  with PECO  Energy for  financial  and
income tax reporting purposes.

2.  SIGNIFICANT ACCOUNTING POLICIES
Basis of Presentation
         The accompanying  financial  statements as of June 30, 1999 and for the
three and six months then ended are unaudited,  but include all adjustments that
PETT considers  necessary for a fair presentation of such financial  statements.
All adjustments are of a normal,  recurring  nature.  The year-end balance sheet
data was  derived  from  audited  financial  statements  but do not  include all
disclosures   required  by  generally  accepted   accounting   principles.   The
preparation  of financial  statements  in  conformity  with  generally  accepted

                                       4
<PAGE>
accounting  principles  requires  management to make estimates and  assumptions.
These  estimates  and  assumptions  affect  the  reported  amount  of  revenues,
expenses,  assets,  and  liabilities  and  disclosure of  contingencies.  Actual
results could differ from these estimates.

Cash and Cash Equivalents
         PETT considers all liquid debt instruments purchased with a maturity of
three months or less to be cash equivalents.

Unamortized Debt Issuance Costs
         The costs  associated  with the issuance of the  Transition  Bonds have
been capitalized and are being amortized over the life of the Transition Bonds.

Income Taxes
         PETT is a wholly owned subsidiary of PECO Energy and has elected not to
be taxed as a corporation for federal income tax purposes. PETT is being treated
as a division of PECO Energy and not as a separate taxable entity.

Derivative Financial Instruments
         Hedge accounting is applied only if the derivative  reduces the risk of
the underlying hedged item and is designed at inception as a hedge, with respect
to the hedged item. If a derivative  instrument  ceased to meet the criteria for
deferral,  any gains or losses,  would be currently  recognized in income.  PETT
does not hold or issue derivative financial instruments for trading purposes.

3.  TRANSITION BONDS
         On March 25,  1999,  PETT,  an  independent  statutory  business  trust
organized  under the laws of  Delaware  and a wholly  owned  subsidiary  of PECO
Energy,  issued $4 billion  aggregate  principal  amount of Transition  Bonds to
securitize a portion of PECO Energy's  authorized  stranded cost  recovery.  The
Transition  Bonds are solely  obligations  of PETT,  secured by ITP sold by PECO
Energy  to PETT  concurrently  with the  issuance  of the  Transition  Bonds and
certain other collateral related thereto.


                                       5
<PAGE>
         The terms of the Transition Bonds are as follows:
<TABLE>
<CAPTION>
                       Approximate
                       Face Amount          Bond              Expected                  Final
         Class         (millions)           Rate              Maturity                  Maturity
<S>                  <C>                   <C>              <C>                       <C>
         A-1           $244.5               5.48%             March 1, 2001             March 1, 2003
         A-2           $275.4               5.63%             March 1, 2003             March 1, 2005
         A-3           $667.0               5.18% (a)         March 1, 2004             March 1, 2006
         A-4           $458.5               5.80%             March 1, 2005             March 1, 2007
         A-5           $464.6               5.26% (a)         September 1, 2007         March 1, 2009
         A-6           $993.4               6.05%             March 1, 2007             March 1, 2009
         A-7           $896.7               6.13%             September 1, 2008         March 1, 2009
<FN>
         (a) The Class A-3 and A-5 Transition  Bonds earn interest at a floating
         rate.  The rates  provided for each such class above are as of June 30,
         1999.
</FN>
</TABLE>

         PETT used the proceeds of the Transition Bonds to purchase the ITP from
PECO Energy. In accordance with the terms of the Competition Act and the May 14,
1998 QRO, PECO Energy will use the proceeds  principally  to reduce its stranded
costs and related capitalization.

         PETT has  entered  into  interest  rate swaps to manage  interest  rate
exposure  associated with the issuance of two floating rate series of Transition
Bonds.  At June 30, 1999, the fair value of these  instruments was $13.9 million
based on the present value difference between the contracted rate (i.e.,  hedged
rate) and the market rates at that date.  The fixed interest rates of series A-3
and A-5 are  6.58%  and  6.94%,  respectively.  A  hypothetical  50 basis  point
increase or  decrease in the spot yield at June 30, 1999 would have  resulted in
an aggregate  fair value of these  interest  rate swaps of $24.1 million or $1.4
million, respectively. If the derivative instruments had been terminated at June
30, 1999,  these  estimated  fair values  represent the amount to be paid by the
counterparties to PETT.

4.  SIGNIFICANT AGREEMENTS AND RELATED PARTY TRANSACTIONS
         Under the  Master  Servicing  Agreement  entered  into by PETT and PECO
Energy dated as of March 25,  1999,  PECO  Energy,  as servicer,  is required to
manage  and  administer  the ITP sold to PETT  and to  collect  the ITC  related
thereto on behalf of PETT. PETT will pay an annual  servicing fee based upon the
outstanding  principal  amount of the  Transition  Bonds.  Upon  closing  of the
Transition Bond issuance, PETT recorded an intercompany liability to PECO Energy
in the  amount  of  $110.7  million  consisting  of:  (1)  overcollateralization
deposits of $60.1 million,  (2) servicing fees of $49.2 million, and (3) trustee
fees of $1.4  million.  This  liability is reflected on PETT's  Statement of Net
Assets Available for Trust Activities as Due to Related Party.

         Copies of the executed Sale Agreement  between PECO Energy,  as seller,
and PETT, as purchaser,  the Master Servicing Agreement,  and the Indenture were
filed with the  Securities  and Exchange  Commission in a Current Report on Form
8-K dated March 31, 1999.

                                       6
<PAGE>
5.       LITIGATION
         Indianapolis Power and Light Company (IPL) filed an action which sought
to  invalidate  the  Competition  Act and  thereby  preclude  PECO  Energy  from
recovering and  securitizing  stranded costs.  IPL asserted that the Competition
Act  discriminates  against  interstate  commerce in  violation  of the Commerce
Clause of the United States Constitution. The Commonwealth Court of Pennsylvania
dismissed this action.  IPL sought review of this dismissal by the United States
Supreme  Court.  The IPL petition for certiorari was denied by the United States
Supreme Court as reported on PECO Energy  Company's  Current  Report on Form 8-K
dated  March 8, 1999.  All  appeals of the PUC's  Final Order dated May 14, 1998
that were being pursued have been resolved and all other appeals that were being
held in abeyance have been withdrawn with prejudice from the Commonwealth  Court
of Pennsylvania and the United States District Court.











                                       7
<PAGE>
ITEM 2.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS

         The  following  analysis  of the  financial  condition  and  results of
activities of PECO Energy  Transition  Trust (PETT) is in an abbreviated  format
pursuant  to  Instruction  H of  Form  10-Q.  Such  analysis  should  be read in
conjunction  with the  Financial  Statements  and Notes to Financial  Statements
included in Item 1 above, and the Note Issuer's annual Financial  Statements and
the Notes to Financial  Statements included in its Registration  Statement dated
March 18, 1999.

         PETT  was  formed  under  the  laws  of  Delaware  pursuant  to a trust
agreement  between PETT,  PECO Energy Company (PECO  Energy),  First Union Trust
Company,  N.A., acting  thereunder not in its individual  capacity but solely as
issuer trustee of PETT, and two beneficiary  trustees  appointed by PECO Energy.
PETT is currently  governed by an amended and restated trust agreement among the
same parties.

         Additions,  primarily  representing  the  recovery of ITC, for both the
three and six  months  ended  June 30,  1999  were  $117.4  million.  Deductions
incurred  for the three and six months  ended June 30, 1999 were $87.2 and $91.9
million,   respectively,   and  included:   $62.9  million  and  $67.6  million,
respectively,   of  interest  charges   associated  with  the  transition  bonds
(Transition Bonds) issued on March 25, 1999; amortization charges related to the
ITC of $21.3 million and servicing fees of $3.0 million.

         On March 25,  1999,  PETT issued  $244.5  million  aggregate  principal
amount of 5.48% Transition Bonds, Class A-1, $275.4 million aggregate  principal
amount of 5.63% Transition Bonds, Class A-2, $667.0 million aggregate  principal
amount of LIBOR+0.125%  (5.18% on June 30, 1999)  Transition  Bonds,  Class A-3,
$458.5 million aggregate  principal amount of 5.80% Transition Bonds, Class A-4,
$464.6 million  aggregate  principal  amount of LIBOR+0.200%  (5.26% on June 30,
1999) Transition Bonds, Class A-5, $993.4 million aggregate  principal amount of
6.05% Transition Bonds, Class A-6, $896.7 million aggregate  principal amount of
6.13% Transition Bonds, Class A-7.


         PETT relies on the  computer  systems of PECO Energy in its capacity as
servicer  under the Master  Servicing  Agreement.  PECO Energy is faced with the
task of  addressing  the Year 2000 (Y2K)  issue.  The Y2K issue is the result of
computer  programs being written using two digits rather than four to define the
applicable  year  and  other   programming   techniques   which  constrain  date
calculations or assign special  meanings to certain dates.  Any of PECO Energy's
computer  systems  that have  date-sensitive  software  of  microprocessors  may
recognize  a date using "00" as the year 1900  rather  than the year 2000.  This
could  result in a system  failure or  miscalculations  causing  disruptions  of
operations,  including,  among other  things,  a temporary  inability to measure
usage,  read  meters,  process  transactions,  send  bills or  operate  electric
generation  stations.  In  addition,  the Y2K issue could  affect the ability of
customers to receive bills sent by PECO Energy or make payments on such bills.

         PECO  Energy  has  determined  that it will be  required  to  modify or
replace  significant  portions of its software so that its computer systems will
properly use dates beyond  December 31,  1999.  PECO Energy  presently  believes

<PAGE>

that, with  modifications to existing  software and conversions to new software,
the Y2K issue can be mitigated.  However,  if such modifications and conversions
are not made or are not completed in a timely manner, the Y2K issue could have a
material  adverse  impact on the  operations  and  financial  condition  of PECO
Energy.  The costs associated with this potential impact are speculative and not
presently quantifiable. PECO Energy has not investigated and has no intention of
investigating  the Y2K issue as it relates to any customer's  ability to receive
bills sent by PECO Energy or make payments on bills.

         For  additional  information  on PECO  Energy's Y2K  project,  see PECO
Energy's Quarterly Report on Form 10-Q for the quarter ended June 30, 1999.


ITEM 3.  QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT
MARKET RISK

Omitted with respect to PETT pursuant to Instruction H of Form 10-Q.










                                       9
<PAGE>
                           PART II. OTHER INFORMATION

ITEM 1.  LEGAL PROCEEDINGS

         None.

ITEM 2.  CHANGES IN SECURITIES AND USE OF PROCEEDS

         Omitted with respect to PETT pursuant to Instruction H of Form 10-Q.

ITEM 3.  DEFAULTS UPON SENIOR SECURITIES

         Omitted with respect to PETT pursuant to Instruction H of Form 10-Q.

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

         Omitted with respect to PETT pursuant to Instruction H of Form 10-Q.

ITEM 5.  OTHER INFORMATION

         None.

ITEM 6. - EXHIBITS AND REPORTS ON FORM 8-K

(a)      Exhibits:

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

(b) Reports on Form 8-K filed during the reporting period:

         Report,  dated May 12, 1999, reporting information under "ITEM 5. OTHER
                  EVENTS"  regarding  the  Monthly  Servicer   Certificates  and
                  Monthly Servicer Report for April 1999.










                                       10
<PAGE>
                          PECO ENERGY TRANSITION TRUST


                                   SIGNATURES

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





Date:  August 13, 1999                      By:  /s/ Diana Moy Kelly
                                                 ----------------------------
                                                 Diana Moy Kelly
                                                 Beneficiary Trustee







                                       11