UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION

                             WASHINGTON, D.C. 20549

                                    FORM 10-Q

              Quarterly Report Pursuant to Section 13 or 15 (d) of
                       the Securities Exchange Act of 1934

                      For the quarter ended March 31, 2002

                          Commission File No. 333-89521

                               CE GENERATION, LLC
             (Exact name of registrant as specified in its charter)

    Delaware                                                     47-0818523
-----------------                                            -------------------
(State or other jurisdiction of                              (I.R.S. Employer
Incorporation or organization)                               Identification No.)

302 South 36th Street, Suite 400-2 Omaha, NE                       68131
--------------------------------------------                       -----
(Address of principal executive offices)                         (Zip Code)

    Registrant's telephone number, including area code: (402) 341-4500
                                                        --------------

    Securities registered pursuant to Section 12(b) of the Act: N/A

    Securities registered pursuant to Section 12(g) of the Act: N/A

     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
                                               ---      ---

     The members'  equity  accounts are held 50% by MidAmerican  Energy Holdings
Company and 50% by El Paso Merchant  Energy North America  Company as of May 14,
2002.


<PAGE>


TABLE OF CONTENTS

Part I    Financial Information...........................................   1
     Item 1.  Financial Statements........................................   3
     Item 2.  Management's Discussion and Analysis of Financial
                Condition and Results of Operations ......................   9
Part II  .................................................................  15
     Item 1.  Legal Proceedings...........................................  15
     Item 2.  Changes in Securities and Use of Proceeds...................  15
     Item 3.  Defaults on Senior Securities...............................  15
     Item 4.  Submission of Matters to a Vote of Security Holders.........  15
     Item 5.  Other Information...........................................  15
     Item 6.  Exhibits and Reports on Form 8-K............................  15

Signatures................................................................  16


<PAGE>

                         INDEPENDENT ACCOUNTANTS' REPORT


Board of Managers
CE Generation, LLC
Omaha, Nebraska

     We  have  reviewed  the  accompanying  consolidated  balance  sheets  of CE
Generation, LLC and subsidiaries  (collectively,  the "Company") as of March 31,
2002,  and  the  related   consolidated   statements  of  operations  and  other
comprehensive  income and cash flows for the three  months  ended March 31, 2002
and 2001.  These financial  statements are the  responsibility  of the Company's
management.

     We conducted our review in accordance  with  standards  established  by the
American  Institute  of  Certified  Public  Accountants.  A  review  of  interim
financial  information consists principally of applying analytical procedures to
financial data and of making inquiries of persons  responsible for financial and
accounting matters. It is substantially less in scope than an audit conducted in
accordance with auditing  standards  generally  accepted in the United States of
America,  the objective of which is the  expression of an opinion  regarding the
financial  statements taken as a whole.  Accordingly,  we do not express such an
opinion.

     Based on our review,  we are not aware of any material  modifications  that
should be made to such financial  statements  for them to be in conformity  with
accounting principles generally accepted in the United States of America.

     We have previously audited, in accordance with auditing standards generally
accepted in the United States of America,  the consolidated  balance sheet of CE
Generation,  LLC and  subsidiaries  as of  December  31,  2001,  and the related
statements of operations and other  comprehensive  income,  members'  equity and
cash  flows for the year then ended (not  presented  herein);  and in our report
dated January 17, 2002 (March 1, 2002 as to Note 9A) we expressed an unqualified
opinion  on  those  consolidated  financial  statements.  In  our  opinion,  the
information  set  forth in the  accompanying  consolidated  balance  sheet as of
December 31, 2001 is fairly stated, in all material respects, in relation to the
consolidated balance sheet from which it has been derived.


DELOITTE & TOUCHE LLP
Omaha, Nebraska
April 26, 2002

                                      -2-

<PAGE>

                       CE GENERATION, LLC AND SUBSIDIARIES
                           CONSOLIDATED BALANCE SHEETS
                             (AMOUNTS IN THOUSANDS)
<TABLE>
<CAPTION>

                                                              March 31,    December 31,
                                                                2002            2001
                                                             -----------   ------------
                                                             (unaudited)
<S>                                                          <C>            <C>
ASSETS
Cash and cash equivalents ................................   $   142,842    $    34,870
Restricted cash ..........................................        16,859         17,025
Accounts receivable, net of allowance for
  doubtful accounts of $4,668 and $24,754 ................        53,356        128,725
Prepaid expenses and other assets ........................        12,487          7,178
Inventory ................................................        22,773         23,705
Due from affiliates ......................................           897            132
                                                             -----------    -----------
Total current assets .....................................       249,214        211,635

Restricted cash ..........................................        12,289         14,009
Properties, plants, contracts and equipment, net .........     1,273,876      1,287,668
Excess of cost over fair value of net assets acquired, net       265,897        265,897
Note receivable from related party .......................       139,896        139,896
Deferred financing charges and other assets ..............        11,939         13,014
                                                             -----------    -----------
Total assets .............................................   $ 1,953,111    $ 1,932,119
                                                             ===========    ===========

LIABILITIES AND MEMBERS' EQUITY
Liabilities:
Accounts payable .........................................   $     7,175    $     8,766
Accrued interest .........................................        17,932          1,240
Interest rate swap liability .............................        13,417         16,295
Other accrued liabilities ................................        34,909         44,471
Current portion of long term debt ........................        86,212         85,036
                                                             -----------    -----------
Total current liabilities ................................       159,645        155,808

Project loans ............................................       153,000        163,142
Salton Sea notes and bonds ...............................       491,678        491,678
Senior secured bonds .....................................       356,400        356,400
Deferred income taxes ....................................       250,225        237,882
                                                             -----------    -----------
Total liabilities ........................................     1,410,948      1,404,910

Minority interest ........................................        59,253         59,832

Commitments and contingencies (Note 3)
Members' equity ..........................................       489,415        475,073
Accumulated other comprehensive income ...................        (6,505)        (7,696)
                                                             -----------    -----------
Total equity .............................................       482,910        467,377
                                                             -----------    -----------

Total liabilities and members' equity ....................   $ 1,953,111    $ 1,932,119
                                                             ===========    ===========
</TABLE>

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

                                      -3-
<PAGE>

                       CE GENERATION, LLC AND SUBSIDIARIES
      CONSOLIDATED STATEMENTS OF OPERATIONS AND OTHER COMPREHENSIVE INCOME
                             (AMOUNTS IN THOUSANDS)
                                   (UNAUDITED)

<TABLE>
<CAPTION>

                                                                     Three Months Ended
                                                                         March 31,
                                                                   ---------------------
                                                                     2002        2001
                                                                   ---------   ---------
<S>                                                                <C>         <C>
Revenue:

Sales of electricity and steam .................................   $ 125,245   $ 147,986

Interest and other income ......................................       2,165       1,701
                                                                   ---------   ---------

Total revenues .................................................     127,410     149,687



Cost and Expenses:

Fuel ...........................................................      29,153      36,688

Plant operations ...............................................      32,278      33,816

Depreciation and amortization ..................................      20,808      20,650

Interest expense ...............................................      19,545      20,987
                                                                   ---------   ---------

Total expenses .................................................     101,784     112,141
                                                                   ---------   ---------



Income before provision for income taxes .......................      25,626      37,546

Provision for income taxes .....................................       5,958      12,475
                                                                   ---------   ---------

Income before minority interest and cumulative effect
of accounting change ...........................................      19,668      25,071

Minority interest ..............................................       5,326       4,897
                                                                   ---------   ---------

Income before cumulative effect of accounting change ...........      14,342      20,174

Cumulative effect of accounting change, net of tax .............        --       (15,386)
                                                                   ---------   ---------

Net income .....................................................   $  14,342   $   4,788
                                                                   =========   =========

 Other comprehensive income (loss):

 Cumulative effect of change in accounting principle, net of tax        --        (5,954)

 Unrealized gain (loss) on cash flow hedges, net of tax ........       1,191        (953)
                                                                   ---------   ---------

 Comprehensive income (loss) ...................................   $  15,533   $  (2,119)
                                                                   =========   =========
</TABLE>

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

                                      -4-

<PAGE>

                       CE GENERATION, LLC AND SUBSIDIARIES
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                             (AMOUNTS IN THOUSANDS)
                                   (UNAUDITED)
<TABLE>
<CAPTION>
                                                                       Three Months Ended
                                                                           March 31,
                                                                     ----------------------
                                                                       2002         2001
                                                                     ---------    ---------
<S>                                                                  <C>          <C>
Cash flows from operating activities:
Net income .......................................................   $  14,342    $   4,788
Adjustments to reconcile net income to cash flows from
  operating activities:
Cumulative effect of change in accounting
  principle, net of tax ..........................................        --         15,386
Depreciation and amortization ....................................      20,808       20,650
Provision for deferred income taxes ..............................      10,656       (1,508)
Distributions to minority interest less than (in excess) of income        (579)         239
Changes in other items:
Accounts receivable ..............................................      75,369      (46,722)
Due from affiliates ..............................................        (765)      (2,148)
Accounts payable and other accrued liabilities ...................       5,539       30,059
Inventory ........................................................         932        4,809
Other assets .....................................................      (4,927)      (1,909)
                                                                     ---------    ---------

Net cash flows from operating activities .........................     121,375       23,644

Cash flows from investing activities:
Capital expenditures .............................................      (6,323)      (3,979)
Decrease/(Increase) in restricted cash ...........................       1,720       (1,351)
                                                                     ---------    ---------

Net cash flows from investing activities .........................      (4,603)      (5,330)

Cash flows from financing activities:
Repayment of project loans .......................................      (8,966)      (7,804)
Decrease in restricted cash ......................................         166          437
                                                                     ---------    ---------

Net cash flows from financing activities .........................      (8,800)      (7,367)
                                                                     ---------    ---------

Net increase in cash and cash equivalents ........................     107,972       10,947
Cash and cash equivalents at beginning of period .................      34,870       36,152
                                                                     ---------    ---------

Cash and cash equivalents at end of period .......................   $ 142,842    $  47,099
                                                                     =========    =========

Supplemental disclosure:
Interest paid ....................................................   $   4,678    $   5,146
                                                                     =========    =========
Income taxes paid ................................................   $     212    $   6,966
                                                                     =========    =========

</TABLE>

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

                                      -5-
<PAGE>

                       CE GENERATION, LLC AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

1.  GENERAL

In the opinion of the management of CE Generation,  LLC ("CE  Generation" or the
"Company") the accompanying  unaudited consolidated financial statements contain
all adjustments  (consisting of normal recurring  accruals) necessary to present
fairly the financial position as of March 31, 2002 and the results of operations
and cash flows for the three months  ended March 31, 2002 and 2001.  The results
of  operations  for the three  months  ended March 31, 2002 are not  necessarily
indicative of the results to be expected for the full year.

The unaudited  consolidated  financial  statements  shall be read in conjunction
with the financial  statements  included in the CE  Generation  annual report on
Form 10-K for the year ended December 31, 2001.

Certain  prior year  amounts  have been  reclassified  in order to conform  with
current year classifications.

2.  ACCOUNTING PRONOUNCEMENTS

CE  Generation  adopted  Statement  of  Financial  Accounting  Standard No. 133,
Accounting for Derivative  Instruments and Hedging Activities,  as amended (SFAS
No. 133) effective January 1, 2001. As a result of the adoption of SFAS No. 133,
CE  Generation  recorded  the fair value of the  liability  associated  with the
interest rate swap agreements at January 1, 2001, which was  approximately  $6.0
million,  net of tax of  approximately  $4.0 million.  These  interest rate swap
agreements are considered  cash flow hedges and therefore the offset is recorded
in accumulated other  comprehensive  income. The adoption did not have an impact
on results of operations or cash flows.

On January 1, 2002,  CE  Generation  adopted  SFAS No. 142,  Goodwill  and Other
Intangible Assets, which dictates the accounting for acquired goodwill and other
intangible  assets.  SFAS No. 142  requires  that  amortization  of goodwill and
indefinite-lived  intangible  assets be discontinued and that entities  disclose
net income for prior periods  adjusted to exclude such  amortization and related
income tax effects, as well as a reconciliation from the originally reported net
income to the adjusted net income. CE Generation's related amortization consists
solely of goodwill amortization,  which has no income tax effect. Following is a
reconciliation of net income as originally reported for the quarters ended March
31, 2002 and 2001, to adjusted net income (in thousands):

                                       Three months
                                      Ended March 31,
                                     2002       2001
                                   -------    -------

     Reported net income.....      $14,342    $ 4,788
     Goodwill amortization...          ---      2,937
                                   -------    -------
     Adjusted net income.....      $14,342    $ 7,725
                                   =======    =======

The following table  summarizes the acquired  intangible  assets as of March 31,
2002 (in thousands):

                                        Gross Carrying       Accumulated
                                            Amount           Amortization
                                        --------------       ------------
     Amortized Intangible Assets:
       Power Purchase Contracts             $313,183            $185,891
       Unpatented Technology                  46,290              13,938
                                            --------            --------
                                            $359,473            $199,829
                                            ========            ========

                                      -6-
<PAGE>

Amortization  expense on  acquired  intangible  assets was $4.5  million for the
three months ended March 31, 2002. CE Generation expects amortization expense on
acquired intangible assets to be $13.6 million for the remainder of fiscal 2002,
$18.1 million for 2003 and $14.9 million for each of the four succeeding  fiscal
years.

CE Generation  is  continuing  to evaluate the other  provisions of the standard
including the  determination  of reporting  units,  the  allocation of corporate
assets and other liabilities,  including goodwill, and the impairment testing of
goodwill.

In August  2001,  FASB  issued  SFAS No. 143,  Accounting  for Asset  Retirement
Obligations.  This standard  addresses  financial  accounting  and reporting for
obligations  related to the  retirement  of tangible  long-lived  assets and the
related  asset  retirement  costs.  SFAS No. 143 is effective  for the Company's
fiscal year beginning January 1, 2003.  Management has not quantified the impact
this standard will have on the Company's consolidated financial statements.

In October 2001, FASB issued SFAS No. 144, Accounting for Impairment or Disposal
of Long-Lived Assets. The standard addresses financial  accounting and reporting
for the  impairment  or disposal of  long-lived  assets.  There was no financial
statement  impact as a result of CE  Generation's  adoption  of SFAS No.  144 on
January 1, 2002.

3.  COMMITMENTS AND CONTINGENCIES

     A.   SOUTHERN CALIFORNIA EDISON AND THE CALIFORNIA POWER EXCHANGE

Southern  California  Edison  ("Edison"),  a  wholly-owned  subsidiary of Edison
International,  is a  public  utility  primarily  engaged  in  the  business  of
supplying   electric  energy  to  retail   customers  in  Central  and  Southern
California,  excluding Los Angeles. Due to reduced liquidity,  Edison had failed
to pay approximately $119 million owed under the power purchase  agreements with
the Imperial Valley Projects (excluding the Salton Sea V and Turbo Projects) for
power  delivered in the fourth  quarter 2000 and the first quarter 2001.  Due to
Edison's  failure to pay contractual  obligations,  the Imperial Valley Projects
(excluding the Salton Sea V and Turbo Projects) had established an allowance for
doubtful accounts of approximately $21 million as of December 31, 2001.

On June 20, 2001, the Imperial Valley  Projects  (excluding the Salton Sea V and
Turbo Projects) entered into Agreements  Addressing Renewable Energy Pricing and
Payment Issues with Edison  ("Settlement  Agreements").  On June 22, 2001 Edison
made an initial $11.6 million  payment to repay the past due balances  under the
Power Purchase Agreements (the "stipulated amounts").  On November 30, 2001, the
Settlement  Agreements  were amended to reflect when Edison would be required to
make the final payment on past due amounts.  The final payment of  approximately
$104.6 million,  representing  the remaining  stipulated  amounts,  was received
March 1, 2002.  Following  the  receipt of  Edison's  final  payment of past due
balances,  the Imperial  Valley  Projects  released the remaining  allowance for
doubtful accounts.

As a result of  uncertainties  related  to  Edison,  the  letter of credit  that
supports the debt service reserve fund at Salton Sea Funding Corporation has not
been extended  beyond its current July 2004  expiration  date, and as such, cash
distributions  are not available to CE  Generation  until the Salton Sea Funding
Corporation  debt service reserve fund of  approximately  $67.6 million has been
funded or the letter of credit has been extended beyond its July 2004 expiration
date or replaced.

In January 2001, the California Power Exchange ("PX") declared bankruptcy.  As a
result,  the Salton Sea V and Turbo Projects have not received payment for power
sold under the Transaction  Agreements  during December 2000 and January 2001 of
approximately  $3.8 million.  The Imperial Valley  Projects have  established an
allowance  for  doubtful  accounts for the full amount of this  receivable.  The
Project entities will vigorously pursue collection.

Edison has failed to pay  approximately  $2.8 million of capacity bonus payments
for the months from October 2001  through  March 2002.  On December 10, 2001 the
Imperial Valley  Projects  (excluding the Salton Sea Unit I, Salton Sea Unit IV,
Salton Sea V and Turbo  Projects) filed a lawsuit against Edison in California's
Imperial County  Superior Court seeking a court order  requiring  Edison to make
the required capacity bonus payments under the Power Purchase Agreements. Due to
Edison's  failure to pay these  contractual  obligations,  the  Imperial  Valley
Projects have  established an allowance for doubtful  accounts of  approximately
$.8 million.  The Project  entities  will  vigorously  pursue  collection of the
capacity bonus payments.

                                      -7-
<PAGE>

     B.   ENVIRONMENTAL LIABILITIES

The  Company is subject to numerous  legislative  and  regulatory  environmental
protection  requirements  involving air and water pollution,  waste  management,
hazardous chemical use, noise abatement, and land use aesthetics.

State and federal  environmental laws and regulations currently have, and future
modifications  may  have,  the  effect of (i)  increasing  the lead time for the
construction of new facilities,  (ii) significantly increasing the total cost of
new  facilities,   (iii)  requiring   modification  of  the  Company's  existing
facilities,  (iv)  increasing the risk of delay on  construction  projects,  (v)
increasing   the  Company's  cost  of  waste  disposal  and  (vi)  reducing  the
reliability  of  service  provided  by the  Company  and the  amount  of  energy
available  from  the  Company's  facilities.  Any of  such  items  could  have a
substantial  impact on amounts  required  to be  expended  by the Company in the
future.  Expenditures for ongoing compliance with environmental regulations that
relate to  current  operations  are  expensed  or  capitalized  as  appropriate.
Expenditures that relate to an existing condition caused by past operations, and
which do not contribute to current or future revenue  generation,  are expensed.
Liabilities   are  recorded  when   environmental   assessments   indicate  that
remediation  efforts are  probable  and the costs can be  reasonably  estimated.
Estimates of the liability are based upon currently  available  facts,  existing
technology and presently enacted laws and regulations  taking into consideration
the likely  effects of  inflation  and other social and  economic  factors,  and
include  estimates of associated legal costs.  These amounts also consider prior
experience in remediating sites, other companies'  clean-up  experience and data
released by the Environmental  Protection Agency or other  organizations.  These
estimated  liabilities are subject to revision in future periods based on actual
costs or new circumstances,  and are included in the accompanying balance sheets
at their undiscounted  amounts.  As of March 31, 2002 and December 31, 2001, the
environmental  liabilities  recorded on the balance  sheet were $3.4 million and
$4.2 million, respectively.

4.  CHANGE IN ACCOUNTING POLICY

Effective January 1, 2001, CE Generation changed its accounting policy for major
maintenance,  overhaul and well workover costs.  These costs,  had  historically
been accounted for using deferral and accrual  methods,  and are now expensed as
incurred.  The  Company  has  recorded  a  cumulative  effect of this  change of
approximately  $15.4 million,  net of tax of approximately $9.9 million,  in the
three months ended March 31, 2001.

5.  RELATED PARTY TRANSACTIONS

MidAmerican Energy Holdings Company ("MEHC") provides certain administrative and
management services to CE Generation,  and MEHC's executive,  financial,  legal,
tax and other  corporate  staff  departments  perform  certain  services  for CE
Generation.  Expenses  incurred  by MEHC  and  allocated  to CE  Generation  are
estimated based on the individual services and expense items provided. Allocated
expenses totaled  approximately $.6 million and $.9 million for the three months
ended March 31,  2002 and 2001,  respectively,  and are  included in general and
administrative expenses.

On September 29, 2000,  Salton Sea Power L.L.C.  (Salton Sea Power) and CE Turbo
LLC ("CE Turbo")  entered into an agreement to sell all available power from the
Salton  Sea V  Project  and Turbo  Project  to ElPaso  Merchant  Energy  Company
("EPME").  Under the terms of the  agreement,  EPME purchased and sold available
power on behalf of Salton  Sea  Power  and CE  Turbo,  into the  California  ISO
markets.  The purchase price for the available  power shall be equivalent to the
value actually received by EPME for the sale of such power,  including renewable
premiums.

On January 17, 2001,  Salton Sea Power and CE Turbo  entered into a  Transaction
Agreement  to sell  available  power  from the  Salton  Sea V Project  and Turbo
Project to EPME.  Under the terms of the agreement,  at the option of Salton Sea
Power and CE Turbo,  EPME  purchased all  available  power from the Salton Sea V
Project and Turbo Project based on day ahead price quotes received from EPME.

On March 27, 2001 and May 1, 2001, the Imperial Valley  Projects  entered into a
Transaction  Agreement to sell  available  power to EPME based on percentages of
the Dow Jones SP-15  Index.  On June 28,  2001,  the  Imperial  Valley  Projects
(excluding the Salton Sea V Project and Turbo Project) ceased selling  available
power to EPME and resumed power sales to Edison.

                                      -8-
<PAGE>

Pursuant  to these  agreements,  sales to EPME  from the  Company  totaled  $2.4
million and $16.9  million for the three  months  ended March 31, 2002 and 2001,
respectively.  As of March 31, 2002 and December 31, 2001,  accounts  receivable
from EPME were $1.6 million and $14.2 million, respectively.

                                      -9-
<PAGE>

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

The following is  management's  discussion and analysis of significant  factors,
which have affected CE  Generation,  LLC's ("CE  Generation"  or the  "Company")
financial condition and results of operations during the periods included in the
accompanying  statements  of  operations.  The Company's  actual  results in the
future could differ significantly from the historical results.

FORWARD-LOOKING STATEMENTS

Certain information included in this report contains forward-looking  statements
made pursuant to the Private  Securities  Litigation Reform Act of 1995 ("Reform
Act"). Such statements are based on current expectations and involve a number of
known and unknown risks and  uncertainties  that could cause the actual  results
and  performance of the Company to differ  materially  from any expected  future
results or performance, expressed or implied, by the forward-looking statements.
In connection with the safe harbor provisions of the Reform Act, the Company has
identified   important  factors  that  could  cause  actual  results  to  differ
materially  from  such  expectations,  including  development  and  construction
uncertainty,  operating  uncertainty,  acquisition  uncertainty,   uncertainties
relating  to  geothermal  resources,  uncertainties  relating  to  economic  and
political  conditions  and  uncertainties  regarding the impact of  regulations,
changes in government policy,  industry deregulation and competition.  Reference
is made to all of the Company's SEC filings,  incorporated  herein by reference,
for a description  of such factors.  The Company  assumes no  responsibility  to
update forward-looking information contained herein.

BUSINESS

The  consolidated   financial  statements  reflect  the  consolidated  financial
statements of CE  Generation,  and its  wholly-owned  subsidiaries,  Magma Power
Company ("Magma"), FSRI Holdings, Inc. ("FSRI") and Yuma Cogeneration Associates
("Yuma").

     The following table sets out information concerning CE Generation Projects:

PROJECT                FUEL         COMMERCIAL      CAPACITY     LOCATION
                                    OPERATION

Vulcan               Geothermal       1986            34 MW      California
Del Ranch            Geothermal       1989            38 MW      California
Elmore               Geothermal       1989            38 MW      California
Leathers             Geothermal       1990            38 MW      California
CE Turbo             Geothermal       2000            10 MW      California
Salton Sea I         Geothermal       1987            10 MW      California
Salton Sea II        Geothermal       1990            20 MW      California
Salton Sea III       Geothermal       1989            49.8 MW    California
Salton Sea IV        Geothermal       1996            39.6 MW    California
Salton Sea V         Geothermal       2000            49 MW      California
Power Resources      Gas              1988            200 MW     Texas
Yuma                 Gas              1994            50 MW      Arizona
Saranac              Gas              1994            240 MW     New York

The Vulcan Project, Del Ranch Project,  Elmore Project,  Leathers Project and CE
Turbo  Project are  referred to as the  Partnership  Projects.  The Salton Sea I
Project,  Salton Sea II Project,  Salton Sea III Project,  Salton Sea IV Project
and Salton  Sea V Project  are  referred  to as the  Salton  Sea  Projects.  The
Partnership Projects and the Salton Sea Projects are collectively referred to as
the Imperial  Valley  Projects.  The Power Resources  Project,  Yuma Project and
Saranac Project are collectively referred to as the Gas Projects.

                                      -10-
<PAGE>

CRITICAL ACCOUNTING POLICIES

The  preparation of financial  statements and related  disclosures in conformity
with  accounting  principles  generally  accepted in the United States  requires
management to make judgments,  assumptions and estimates that affect the amounts
reported in the Consolidated Financial Statements and accompanying notes. Note 2
to the  Consolidated  Financial  Statements  in the  Annual  Report on Form 10-K
describes  the  significant   accounting   policies  and  methods  used  in  the
preparation of the Consolidated  Financial  Statements.  Estimates are used for,
but not limited to, the  accounting  for the  allowance  for doubtful  accounts,
impairment of long-lived assets and contingent liabilities. Actual results could
differ from these  estimates.  The following  critical  accounting  policies are
impacted  significantly  by judgments,  assumptions  and  estimates  used in the
preparation of the Consolidated Financial Statements.

Allowance for Doubtful Accounts
-------------------------------

The  allowance  for  doubtful  accounts  is  based  on  our  assessment  of  the
collectibility  of  specific  customer  accounts  and the aging of the  accounts
receivable.  If there is a deterioration of a major customer's credit worthiness
or actual defaults are higher than our historical  experience,  estimates of the
recoverability of amounts due could be adversely affected.

Impairment of Long-Lived Assets
-------------------------------

The  Company's  long-lived  assets  consist  primarily  of  property,  plant and
equipment,  goodwill  and  intangible  assets  that were  acquired  in  business
acquisitions.  We believe the useful  lives we assigned to these  assets,  which
range from 3 to 40 years, are reasonable.  The Company  evaluates the long-lived
assets for  impairment  when  events or changes in  circumstances  indicate,  in
management's  judgment,  that  the  carrying  value  of such  assets  may not be
recoverable.  These computations  utilize judgments and assumptions  inherent in
management's   estimate  of   undiscounted   future  cash  flows  to   determine
recoverability  of an asset. If our  assumptions  about these assets change as a
result of events or  circumstances,  and we believe the assets may have declined
in value, then we may record impairment charges, resulting in lower profits.

Contingent Liabilities
----------------------

The Company is subject to the possibility of various loss contingencies  arising
in the ordinary course of business.  The Company considers the likelihood of the
loss or impairment  of an asset or the  incurrence of a liability as well as our
ability  to  reasonably   estimate  the  amount  of  loss  in  determining  loss
contingencies. An estimated loss contingency is accrued when it is probable that
a liability  has been  incurred or an asset has been  impaired and the amount of
loss can be  reasonably  estimated.  The  Company  regularly  evaluates  current
information  available  to us to  determine  whether  such  accruals  should  be
adjusted.

RESULTS OF OPERATIONS

Sales of electricity  and steam decreased to $125.2 million for the three months
ended March 31, 2002 from  $148.0  million for the same period in 2001,  a 15.5%
decrease.  Sales of  electricity  and steam for the three months ended March 31,
2002  included  the  impact of a $20  million  reduction  in the  allowance  for
doubtful  accounts.  Sales of  electricity  and steam for the three months ended
March 31, 2001  included the impact of a $44 million  increase in the  allowance
for doubtful  accounts.  Excluding the impact of the adjustments  related to the
allowance for doubtful  accounts,  sales of electricity  and steam decreased $87
million to $105  million  for the three  months  ended  March 31, 2002 from $192
million for the three months ended March 31, 2001. This decrease was a result of
lower energy prices under the Imperial  Valley  Projects' and the Yuma Project's
PPAs.

                                      -11-
<PAGE>

Edison's Average Avoided Cost of Energy was 2.9 cents per kilowatt-hour and 15.2
cents per  kilowatt-hour  for the three  months  ended  March 31, 2002 and 2001,
respectively.   Estimates  of  Edison's  future  Avoided  Cost  of  Energy  vary
substantially  from  year to year.  As a result  of the  Settlement  Agreements,
Edison has  elected  to pay the  Imperial  Valley  Projects  (except  Salton Sea
Projects  IV and V and the  Turbo  Project)  a  fixed  energy  price  in lieu of
Edison's  Average  Avoided  Cost of  Energy.  The  fixed  energy  price was 3.25
cents/per  kilowatt-hour  in the first quarter 2002 and is scheduled to increase
to 5.37 cents per kilowatt-hour effective May 1, 2002 through April 30, 2007.

The following  operating data represents the aggregate  capacity and electricity
production of the Imperial Valley Projects:

                                             Three Months Ended
                                                 March 31,
                                             2002          2001
                                             ----          ----

Overall capacity factor                      89.5%         92.4%
Megawatt-hours produced                    630,800       651,500
Capacity (net megawatts)(average)            326.4         326.4

The overall capacity factor for the Salton Sea Projects  decreased for the three
months  ended  March 31,  2002  compared  to the same period in 2001 due to more
extensive overhauls in 2002 than in 2001.

The following  operating data represents the aggregate  capacity and electricity
production of the Gas Projects:

                                                   Three Months Ended
                                                       March 31,
                                                   2002           2001
                                                   ----           ----

Overall capacity factor                            93.5%          95.1%
Megawatt-hours produced                          989,300      1,006,940
Capacity (net megawatts)(weighted average)           490            490

The  overall  capacity  factor  of the  Gas  Projects  reflects  the  effect  of
contractual  curtailments  and  maintenance  scheduling.  The  capacity  factors
adjusted for the  contractual  curtailments  during the three months ended March
31, 2002 and 2001 were 100.9% and 99.6%, respectively.

Interest  and other income  increased  to $2.2  million  during the three months
ended  March 31,  2002  from  $1.7  million  for the same  period in 2001.  This
increase is primarily the result of interest  income earned on Edison's past due
balances in the first quarter of 2002.

Fuel  expenses  decreased  during the three months ended March 31, 2002 to $29.2
million from $36.7 million for the same period in 2001.  The decrease was due to
decreased production in 2002 and higher gas prices in 2001, primarily at Yuma.

Plant operating  expenses decreased during the three months ended March 31, 2002
to $32.3  million  from $33.8  million for the same period in 2001.  These costs
include operating,  maintenance,  resource, general and administrative and other
plant operating  expenses.  The decrease was primarily due to decreased  royalty
costs at the  Imperial  Valley  Projects  due to the  decrease in revenue.  This
decrease was partially offset by extensive overhaul costs at the Imperial Valley
Projects in 2002.

Depreciation  and  amortization  increased  slightly to $20.8 million during the
three  months  ended  March 31,  2002 from $20.7  million for the same period in
2001. The increase resulted from the capital additions,  partially offset by the
discontinuation  of goodwill  amortization,  as a result of the adoption of SFAS
No. 142, which was $2.9 million in the first quarter of 2001.

                                      -12-
<PAGE>

Interest expense decreased during the three months ended March 31, 2002 to $19.5
million from $21.0  million for the same period in 2001.  The decrease  resulted
from the paydown of debt balances.

The provision for income taxes decreased to $6.0 million during the three months
ended March 31, 2002 from $12.5 million for the same period in 2001. The changes
from year to year in the effective tax rate are due primarily to the  generation
of energy tax credits and depletion deductions.

Minority interest  increased to $5.3 million during the three months ended March
31, 2002 from $4.9  million for the same period in 2001.  The  increase  was the
result of higher net income at the Saranac Project.

The Company has changed its accounting  policy for major  maintenance,  overhaul
and well workover costs. These costs, which have historically been accounted for
using deferral and accrual methods, are now expensed as incurred. The cumulative
effect of the change in accounting policy represents a January 1, 2001 write off
of  prepaid  and  accrued  major  maintenance  and  well  workover  balances  of
approximately $15.4 million, net of tax of approximately $9.9 million.

Net income  increased to $14.3 during the three months ended March 31, 2002 from
$4.8 million for the same period in 2001.

RELATED PARTY TRANSACTIONS

MEHC provides certain  administrative and management  services to CE Generation,
and  MEHC's  executive,   financial,   legal,  tax  and  other  corporate  staff
departments  perform certain  services for CE Generation.  Expenses  incurred by
MEHC and  allocated  to CE  Generation  are  estimated  based on the  individual
services and expense items provided.  Allocated  expenses totaled  approximately
$.6 million and $.9 million for the three  months ended March 31, 2002 and 2001,
respectively, and are included in general and administrative expenses.

On September 29, 2000,  Salton Sea Power L.L.C.  (Salton Sea Power) and CE Turbo
LLC ("CE Turbo")  entered into an agreement to sell all available power from the
Salton  Sea V  Project  and  Turbo  Project  to  EPME.  Under  the  terms of the
agreement, EPME purchased and sold available power on behalf of Salton Sea Power
and CE Turbo,  into the  California  ISO  markets.  The  purchase  price for the
available  power shall be equivalent to the value actually  received by EPME for
the sale of such power, including renewable premiums.

On January 17, 2001,  Salton Sea Power and CE Turbo  entered into a  Transaction
Agreement  to sell  available  power  from the  Salton  Sea V Project  and Turbo
Project to EPME.  Under the terms of the agreement,  at the option of Salton Sea
Power and CE Turbo,  EPME  purchased all  available  power from the Salton Sea V
Project and Turbo Project based on day ahead price quotes received from EPME.

On March 27, 2001 and May 1, 2001, the Imperial Valley  Projects  entered into a
Transaction  Agreement to sell  available  power to EPME based on percentages of
the Dow Jones SP-15  Index.  On June 28,  2001,  the  Imperial  Valley  Projects
(excluding the Salton Sea V Project and Turbo Project) ceased selling  available
power to EPME and resumed power sales to Edison.

Pursuant  to these  agreements,  sales to EPME  from the  Company  totaled  $2.4
million and $16.9  million for the three  months  ended March 31, 2002 and 2001,
respectively.  As of March 31, 2002 and December 31, 2001,  accounts  receivable
from EPME were $1.6 million and $14.2 million, respectively.

LIQUIDITY AND CAPITAL RESOURCES

Each of CE Generation's direct or indirect  subsidiaries is organized as a legal
entity  separate and apart from CE  Generation  and its other  subsidiaries  and
MEHC.  Pursuant to separate  project  financing  agreements,  the assets of each
subsidiary  (excluding  Yuma) are pledged or  encumbered to support or otherwise
provide the security for their own project or subsidiary  debt. It should not be
assumed that any asset of any subsidiary of CE Generation,  will be available to
satisfy  the  obligations  of CE  Generation  or any of its other  subsidiaries;
provided,  however,  that  unrestricted cash or other assets which are available
for  distribution  may,  subject to  applicable  law and the terms of  financing
arrangements  for such  parties,  be  advanced,  loaned,  paid as  dividends  or
otherwise  distributed or  contributed  to CE Generation or affiliates  thereof.
"Subsidiary"  means all of CE Generation's  direct or indirect  subsidiaries (1)
owning direct or indirect  interests in the Imperial Valley Projects  (including
the Salton

                                      -13-
<PAGE>

Sea Projects and the  Partnership  Projects  other than Magma Power  Company and
Salton Sea Power Company),  or (2) owning direct  interests in the  subsidiaries
that own interests in the foregoing projects,  the Saranac Project and the Power
Resources Project.

CE Generation  generated  cash flows from  operations of $121.4  million for the
three  months  ended March 31,  2002  compared  with $23.6  million for the same
period in 2001.  The  increase  was  primarily  due to the  receipt  of past due
balances from Southern California Edison ("Edison").

Edison, a wholly-owned  subsidiary of Edison International,  is a public utility
primarily  engaged  in the  business  of  supplying  electric  energy  to retail
customers  in Central and Southern  California,  excluding  Los Angeles.  Due to
reduced  liquidity,  Edison failed to pay approximately  $119 million owed under
the power purchase agreements with the Imperial Valley Projects,  (excluding the
Salton Sea V and Turbo  Projects) for power delivered in the fourth quarter 2000
and  the  first  quarter  2001.  Due to  Edison's  failure  to  pay  contractual
obligations,  the Imperial Valley Projects (excluding the Salton Sea V and Turbo
Projects) had  established an allowance for doubtful  accounts of  approximately
$21.0 million as of December 31, 2001.

On June 20, 2001, the Imperial Valley  Projects  (excluding the Salton Sea V and
Turbo Projects) entered into Agreements  Addressing Renewable Energy Pricing and
Payment Issues with Edison  ("Settlement  Agreements").  On June 22, 2001 Edison
made an initial $11.6 million  payment to repay the past due balances  under the
Power Purchase Agreements (the "stipulated amounts").  On November 30, 2001, the
Settlement  Agreements  were amended to reflect when Edison would be required to
make the final payment on past due amounts.  The final payment of  approximately
$104.6 million,  representing  the remaining  stipulated  amounts,  was received
March 1, 2002.  Following  the  receipt of  Edison's  final  payment of past due
balances,  the Imperial  Valley  Projects  released the remaining  allowance for
doubtful accounts.

As a result of  uncertainties  related  to  Edison,  the  letter of credit  that
supports the debt service reserve fund at Salton Sea Funding Corporation has not
been extended  beyond its current July 2004  expiration  date, and as such, cash
distributions  are not available to CE  Generation  until the Salton Sea Funding
Corporation  debt service reserve fund of  approximately  $67.6 million has been
funded or the letter of credit has been extended beyond its July 2004 expiration
date or replaced.

In January 2001, the California Power Exchange ("PX") declared bankruptcy.  As a
result,  the Salton Sea V and Turbo Projects have not received payment for power
sold under the Transaction  Agreements  during December 2000 and January 2001 of
approximately  $3.8 million.  The Imperial Valley  Projects have  established an
allowance for doubtful accounts for the full amount of this receivable.

Edison has failed to pay  approximately  $2.8 million of capacity bonus payments
for the months from October 2001  through  March 2002.  On December 10, 2001 the
Imperial Valley  Projects  (excluding the Salton Sea Unit I, Salton Sea Unit IV,
Salton Sea V and Turbo  Projects) filed a lawsuit against Edison in California's
Imperial County  Superior Court seeking a court order  requiring  Edison to make
the required capacity bonus payments under the Power Purchase Agreements. Due to
Edison's  failure to pay these  contractual  obligations,  the  Imperial  Valley
Projects have  established an allowance for doubtful  accounts of  approximately
$.8 million.  The Project  entities  will  vigorously  pursue  collection of the
capacity bonus payments.

Cash flow used in  investing  activities  was $4.6  million for the three months
ended March 31, 2002 compared with cash used of $5.3 million for the same period
in  2001.   Capital   expenditures  are  the  primary  components  of  investing
activities.

Cash flow used in  financing  activities  was $8.8  million for the three months
ended March 31, 2002 compared with $7.4 million for the same period in 2001. The
changes  in  cash  flows  from  financing  activities  principally  reflect  the
scheduled debt repayments.


ENVIRONMENTAL LIABILITIES

The  Company is subject to numerous  legislative  and  regulatory  environmental
protection  requirements  involving air and water pollution,  waste  management,
hazardous chemical use, noise abatement, and land use aesthetics.

                                      -14-
<PAGE>

State and federal  environmental laws and regulations currently have, and future
modifications  may  have,  the  effect of (i)  increasing  the lead time for the
construction of new facilities,  (ii) significantly increasing the total cost of
new  facilities,   (iii)  requiring   modification  of  the  Company's  existing
facilities,  (iv)  increasing the risk of delay on  construction  projects,  (v)
increasing   the  Company's  cost  of  waste  disposal  and  (vi)  reducing  the
reliability  of  service  provided  by the  Company  and the  amount  of  energy
available  from  the  Company's  facilities.  Any of  such  items  could  have a
substantial  impact on amounts  required  to be  expended  by the Company in the
future.  Expenditures for ongoing compliance with environmental regulations that
relate to  current  operations  are  expensed  or  capitalized  as  appropriate.
Expenditures that relate to an existing condition caused by past operations, and
which do not contribute to current or future revenue  generation,  are expensed.
Liabilities   are  recorded  when   environmental   assessments   indicate  that
remediation  efforts are  probable  and the costs can be  reasonably  estimated.
Estimates of the liability are based upon currently  available  facts,  existing
technology and presently enacted laws and regulations  taking into consideration
the likely  effects of  inflation  and other social and  economic  factors,  and
include  estimates of associated legal costs.  These amounts also consider prior
experience in remediating sites, other companies'  clean-up  experience and data
released by the Environmental  Protection Agency or other  organizations.  These
estimated  liabilities are subject to revision in future periods based on actual
costs or new circumstances,  and are included in the accompanying balance sheets
at their undiscounted  amounts.  As of March 31, 2002 and December 31, 2001, the
environmental  liabilities  recorded on the balance  sheet were $3.4 million and
$4.2 million, respectively.

INFLATION

Inflation has not had a significant impact on CE Generation's cost structure.

QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET RISK

There have been no  material  changes in the  market  risk from the  information
provided in Item 7A Quantitative and Qualitative  Disclosures  About Market Risk
of the  Company's  Annual  Report on Form 10-K for the year ended  December  31,
2001.

CONTRACTUAL OBLIGATIONS AND COMMERCIAL COMMITMENTS

There  have  been  no  material  changes  in  the  contractual  obligations  and
commercial  commitments from the information provided in Item 7 of the Company's
Annual Report on Form 10-K for the year ended December 31, 2001.

                                      -15-

<PAGE>



         PART II  OTHER INFORMATION.

ITEM I - LEGAL PROCEEDINGS

     Neither CE  Generation  nor its  subsidiaries  are parties to any  material
legal matters except those described in Footnote 3 of CE Generation's  financial
statements.

ITEM 2 - CHANGES IN SECURITIES

     Not applicable.

ITEM 3 - DEFAULT ON SENIOR SECURITIES

     Not applicable.

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

     Not applicable.

ITEM 5 - OTHER INFORMATION

     Not applicable.

ITEM 6 - EXHIBITS AND REPORTS ON FORM 8-K


     (a)  Exhibits:
          Not applicable.

(b)      Reports on Form 8-K:
         -------------------
         Current  Report filed March 4, 2002,  reporting of receipt of past due
         payments  from  Southern  California Edison.

                                      -16-
<PAGE>

SIGNATURES

     Pursuant  to the  requirements  of  Section  13 or 15(d) 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,  in the City of Omaha,
State of Nebraska, on this 14th day of May 2002



                                            CE Generation, LLC

                                            /s/ Joseph M. Lillo
                                            ---------------------------
                                            By:  Joseph M. Lillo
                                                 Vice President and Controller


                                      -17-