<PAGE>   1

--------------------------------------------------------------------------------
--------------------------------------------------------------------------------

                UNITED STATES SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                             ---------------------

                                   FORM 10-Q

                             ---------------------

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

                  FOR THE QUARTERLY PERIOD ENDED JUNE 30, 2001

                                       OR

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

             FOR THE TRANSITION PERIOD FROM           TO

                       COMMISSION FILE NUMBER: 333-45124

                             ---------------------

                            EAST COAST POWER L.L.C.
             (Exact name of Registrant as Specified in its Charter)

<Table>
<S>                                            <C>
                   DELAWARE                                      52-2143667
         (State or Other Jurisdiction                         (I.R.S. Employer
      of Incorporation or Organization)                     Identification No.)

               EL PASO BUILDING
            1001 LOUISIANA STREET
                HOUSTON, TEXAS                                     77002
   (Address of Principal Executive Offices)                      (Zip Code)
</Table>

       Registrant's Telephone Number, Including Area Code: (713) 420-2600

     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 [ ]

     99% of the membership interests of East Coast Power L.L.C. are owned
directly or indirectly by Mesquite Investors, L.L.C., and 1% of membership
interests is owned directly or indirectly by East Coast Power Holding Company
L.L.C. Such membership interests are not publicly traded and therefore have no
separate, quantifiable market value.

--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
<PAGE>   2

                        PART I -- FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

                            EAST COAST POWER L.L.C.

                       CONSOLIDATED STATEMENTS OF INCOME
                                 (IN MILLIONS)
                                  (UNAUDITED)

<Table>
<Caption>
                                                                                 SIX MONTHS
                                                              QUARTER ENDED        ENDED
                                                                 JUNE 30,         JUNE 30,
                                                              --------------   --------------
                                                              2001     2000    2001     2000
                                                              -----   ------   -----   ------
<S>                                                           <C>     <C>      <C>     <C>
Operating revenues
  Electricity...............................................  $30.4   $   --   $35.6   $   --
  Steam.....................................................    1.7       --     2.2       --
  Equity in earnings (losses) of affiliates
     Cogen Technologies Linden Venture, L.P.................   34.8     12.2    54.0     26.0
     Camden Cogen L.P.......................................    1.3     (0.6)    4.8      0.5
     Cogen Technologies NJ Venture..........................     --      1.4    (3.6)     4.6
                                                              -----   ------   -----   ------
                                                               68.2     13.0    93.0     31.1
                                                              -----   ------   -----   ------
Operating expenses
  Fuel......................................................   16.7       --    20.6       --
  Operation and maintenance.................................    3.7       --     5.3       --
  Depreciation..............................................    0.8       --     0.9       --
  General and administrative................................    1.6      1.6     3.4      3.9
  Amortization of excess cost...............................    5.9       --     7.1       --
                                                              -----   ------   -----   ------
                                                               28.7      1.6    37.3      3.9
                                                              -----   ------   -----   ------
Operating income............................................   39.5     11.4    55.7     27.2
                                                              -----   ------   -----   ------
Other (income) expense
  Interest and other income.................................   (0.8)    (0.5)   (1.4)    (0.9)
  Interest expense..........................................   22.3     22.8    44.1     46.3
                                                              -----   ------   -----   ------
                                                               21.5     22.3    42.7     45.4
                                                              -----   ------   -----   ------
Net income (loss)...........................................  $18.0   $(10.9)  $13.0   $(18.2)
                                                              =====   ======   =====   ======
</Table>

                            See accompanying notes.

                                        1
<PAGE>   3

                            EAST COAST POWER L.L.C.

                          CONSOLIDATED BALANCE SHEETS
                                 (IN MILLIONS)
                                  (UNAUDITED)

<Table>
<Caption>
                                                              JUNE 30,   DECEMBER 31,
                                                                2001         2000
                                                              --------   ------------
<S>                                                           <C>        <C>
                                       ASSETS


Current assets
  Cash and cash equivalents.................................  $   10.8     $    4.3
  Restricted cash...........................................      14.2         12.7
  Accounts receivable, net..................................      16.6           --
  Inventory.................................................       4.4           --
  Other current assets......................................       0.8          0.6
                                                              --------     --------
          Total current assets..............................      46.8         17.6
                                                              --------     --------
Investment in affiliates
  Cogen Technologies Linden Venture, L.P. ..................     775.3        778.2
  Camden Cogen L.P..........................................     175.1        179.4
  Cogen Technologies NJ Venture.............................        --        178.9
                                                              --------     --------
          Total investment in affiliates....................     950.4      1,136.5
                                                              --------     --------
Property, plant, and equipment, at cost.....................      65.1          0.5
Less accumulated depreciation...............................       0.9          0.2
                                                              --------     --------
          Total property, plant, and equipment, net.........      64.2          0.3
                                                              --------     --------
Other assets
  Construction in progress..................................      91.6         72.9
  NJ Venture power purchase agreement excess costs, net.....     169.7           --
  Other.....................................................      12.0         12.5
                                                              --------     --------
                                                                 273.3         85.4
                                                              --------     --------
          Total assets......................................  $1,334.7     $1,239.8
                                                              ========     ========

                           LIABILITIES AND MEMBERS' EQUITY

Current liabilities
  Accounts payable..........................................  $    5.8     $    0.2
  Accounts payable, affiliate...............................      11.0         14.9
  Current maturities of long-term debt......................      51.4         37.7
  Accrued liabilities.......................................       4.4          2.2
  Interest payable..........................................       4.6          3.4
                                                              --------     --------
          Total current liabilities.........................      77.2         58.4
                                                              --------     --------
Long-term debt..............................................   1,171.8      1,146.2
                                                              --------     --------
Commitments and contingencies
  Members' equity...........................................      84.8         35.2
  Accumulated other comprehensive income....................       0.9           --
                                                              --------     --------
          Total members' equity.............................      85.7         35.2
                                                              --------     --------
          Total liabilities and members' equity.............  $1,334.7     $1,239.8
                                                              ========     ========
</Table>

                            See accompanying notes.

                                        2
<PAGE>   4

                            EAST COAST POWER L.L.C.

                     CONSOLIDATED STATEMENTS OF CASH FLOWS
                                 (IN MILLIONS)
                                  (UNAUDITED)

<Table>
<Caption>
                                                              SIX MONTHS ENDED
                                                                  JUNE 30,
                                                              -----------------
                                                               2001      2000
                                                              -------   -------
<S>                                                           <C>       <C>
Cash flows from operating activities
  Net income (loss).........................................  $ 13.0    $(18.2)
  Adjustments to reconcile net income (loss) to net cash
     from operating activities
     Distributed earnings of unconsolidated affiliates
       (Earnings) loss from unconsolidated affiliates
          Cogen Technologies Linden Venture, L.P. ..........   (54.0)    (26.0)
          Camden Cogen L.P. ................................    (4.8)     (0.5)
          Cogen Technologies NJ Venture.....................     3.6      (4.6)
       Distributions from unconsolidated affiliates
          Cogen Technologies Linden Venture, L.P. ..........    56.9      60.1
          Camden Cogen L.P. ................................    10.0       6.9
          Cogen Technologies NJ Venture.....................     1.9      20.3
     Depreciation...........................................     0.9        --
     Amortization of NJ Venture power purchase agreement
      excess costs..........................................     7.1        --
     Amortization of deferred financing costs...............     0.6       0.6
     Amortization of Linden Ltd. term loan premium..........    (0.4)     (0.4)
  Working capital changes, net of non-cash transactions
     Change in accounts receivable..........................    (6.4)       --
     Change in accounts payable, affiliate..................     1.0       0.2
     Change in inventory....................................     0.3        --
     Change in interest payable.............................    (0.3)       --
     Net change in other assets and liabilities.............     1.3      (4.2)
                                                              ------    ------
          Net cash provided by operating activities.........    30.7      34.2
                                                              ------    ------
Cash flows from investing activities
  Cash paid for additional interest in Cogen Technologies NJ
     Venture................................................   (16.0)       --
  Advances to unconsolidated affiliates in the form of
     short-term loan from restricted cash...................    (8.0)       --
  Payments received on short-term affiliate loan to
     restricted cash........................................     8.0        --
  Purchases of property, plant, and equipment...............    (0.2)       --
  Construction in progress..................................   (18.7)    (18.2)
  Change in accounts payable, affiliate relating to
     construction...........................................    (4.9)      6.9
                                                              ------    ------
          Net cash used in investing activities.............   (39.8)    (11.3)
                                                              ------    ------
Cash flows from financing activities
  Short-term borrowings under subordinated credit
     facility...............................................      --       1.0
  Long-term repayment under senior secured notes............   (10.0)     (6.3)
  Principal payments on long-term debt......................    (9.6)     (7.5)
  Debt issuance costs.......................................      --      (0.4)
  Contributions received....................................    36.7        --
  Change in restricted cash.................................    (1.5)      0.2
                                                              ------    ------
          Net cash provided by (used in) financing
           activities.......................................    15.6     (13.0)
                                                              ------    ------
Increase in cash and cash equivalents.......................     6.5       9.9
Cash and cash equivalents
  Beginning of period.......................................     4.3       3.2
                                                              ------    ------
  End of period.............................................  $ 10.8    $ 13.1
                                                              ======    ======
Cash paid for interest, net of amount capitalized...........  $ 43.4    $ 46.4
                                                              ======    ======
</Table>

                            See accompanying notes.

                                        3
<PAGE>   5

                            EAST COAST POWER L.L.C.

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                  (UNAUDITED)

1. BASIS OF PRESENTATION

     East Coast Power L.L.C. (the Company) is a Delaware limited liability
company. Through its affiliates, El Paso Corporation (El Paso) obtained control
of the Company through a series of transactions consummated on February 22, 2001
and February 23, 2001. As a result of these transactions, El Paso indirectly
owns a common interest in the Company with a 99% sharing ratio, and Enron North
America (Enron), through its affiliate, East Coast Power Holding Company L.L.C.,
retains a preferred interest in the Company with a 1% sharing ratio. The
financial statements have not been adjusted to fair market value because we have
publicly traded debt. In connection with El Paso obtaining control of the
Company, $157.9 million of the Enron subordinated note was assigned to an
affiliate of El Paso, and the remaining $30 million resides with an affiliate of
Enron.

     Our December 31, 2000, audited financial statements, as presented in our
registration statement on Form S-4/A, include a summary of our significant
accounting policies and other disclosures. You should read those financial
statements in conjunction with this Quarterly Report on Form 10-Q. The financial
statements at June 30, 2001, and for the quarter and six months ended June 30,
2001, are unaudited. The balance sheet at December 31, 2000, is derived from our
audited financial statements. These financial statements have been prepared
pursuant to the rules and regulations of the Securities and Exchange Commission
and do not include all disclosures required by accounting principles generally
accepted in the United States. In our opinion, we have made all adjustments, all
of which are of a normal, recurring nature, to fairly present our interim period
results. Information for interim periods may not necessarily indicate the
results of operations for the entire year due to the seasonal nature of our
business.

  Accounting Policies

     Our accounting policies are consistent with those discussed in our Form
S-4/A, except as discussed below. You should refer to our Form S-4/A for a
further discussion of those policies.

  Accounting for Derivative Instruments and Hedging Activities

     With the adoption of Statement of Financial Accounting Standards (SFAS) No.
133, Accounting for Derivatives and Hedging Activities, as amended by SFAS No.
138, we now record all derivative instruments at their fair value and classify
them as either assets or liabilities on our balance sheet, with a corresponding
offset to income or other comprehensive income depending on their designation,
their intended use, or their ability to qualify as hedges under the standard.
Under SFAS No. 133, we are required to record our proportionate share of the
impact that all derivative instruments have on the financial statements of our
investee as adjustments to our other comprehensive income and our unconsolidated
affiliates. The adoption of SFAS No. 133 did not have a material impact on our
financial position, operating results, or cash flows.

  Reclassifications

     Certain reclassifications have been made to prior-year amounts to conform
to the current-year presentation. All reclassifications have been applied
consistently for periods presented.

2. THE BAYONNE ACQUISITION

     In December 2000 the Company acquired an additional 0.375 percent
partnership interest in Bayonne Venture from an unaffiliated party. In March
2001, we acquired the remaining 7.875 percent partnership interests in Cogen
Technologies NJ Venture (Bayonne Venture), a New Jersey general partnership that
owns and operates a 176-megawatt cogeneration facility in Bayonne, New Jersey,
from unaffiliated parties. As a

                                        4
<PAGE>   6
                            EAST COAST POWER L.L.C.

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

result, we are the sole owner of Bayonne Venture, whose financial statements
were consolidated with East Coast Power from March 13, 2001. We financed these
acquisitions primarily through cash contributions from Mesquite Investors L.L.C.
and Bonneville Pacific Corporation. As a result of the consolidation of Bayonne
Venture, East Coast Power now includes the Bayonne Venture long-term debt of
$58.0 million on its balance sheet as of June 30, 2001. Had all the transactions
to acquire the remaining partnership interests in Bayonne Venture been effective
as of January 1, 2001, the proforma revenue and net income for the six months
ended June 30, 2001, would have been $119.7 million and $12.9 million,
respectively. Had all the transactions to acquire the remaining partnership
interests in Bayonne Venture been effective as of January 1, 2000, the proforma
revenue and net loss as of June 30, 2000 would have been $80.7 million and
$(17.6) million.

3. INVESTMENT IN AFFILIATES

     The following table reflects information on our investments in affiliates
for the six months ended June 30, 2001, and the year ended December 31, 2000:

<Table>
<Caption>
                                                  LINDEN    CAMDEN    BAYONNE
                                                  VENTURE   VENTURE   VENTURE    TOTAL
                                                  -------   -------   -------   --------
                                                              (IN MILLIONS)
<S>                                               <C>       <C>       <C>       <C>
Balance at December 31, 2000....................  $778.2    $179.4    $ 178.9   $1,136.5
Equity in earnings..............................    76.0      11.2        0.7       87.9
Amortization of excess costs....................   (22.0)     (6.4)      (4.3)     (32.7)
Acquisition of additional interests.............      --        --        3.4        3.4
Reclass to NJ Venture PPA excess costs(1).......      --        --     (176.8)    (176.8)
Camden Cogen -- risk management asset...........      --       0.9         --        0.9
Distributions received..........................   (56.9)    (10.0)      (1.9)     (68.8)
                                                  ------    ------    -------   --------
Balance at June 30, 2001........................  $775.3    $175.1    $    --   $  950.4
                                                  ======    ======    =======   ========
</Table>

     The unamortized excess costs over the Company's share of underlying Venture
equity were $847.3 million at June 30, 2001, and $1,046.7 million at December
31, 2000.

     The following table presents summary balance sheet information for the
Company's affiliates at June 30, 2001, and December 31, 2000:

<Table>
<Caption>
                                                 JUNE 30, 2001                 DECEMBER 31, 2000
                                         ------------------------------   ---------------------------
                                         LINDEN    CAMDEN     BAYONNE     LINDEN    CAMDEN    BAYONNE
                                         VENTURE   VENTURE   VENTURE(1)   VENTURE   VENTURE   VENTURE
                                         -------   -------   ----------   -------   -------   -------
                                                                (IN MILLIONS)
<S>                                      <C>       <C>       <C>          <C>       <C>       <C>
Assets
  Current assets.......................  $ 76.9    $ 24.7      $29.1      $ 76.1    $ 30.2     $30.6
  Property, plant, and equipment,
     net...............................   379.3      94.2       63.9       384.2      96.0      65.3
  Risk management asset................      --       0.9         --          --        --        --
                                         ------    ------      -----      ------    ------     -----
          Total assets.................  $456.2    $119.8      $93.0      $460.3    $126.2     $95.9
                                         ======    ======      =====      ======    ======     =====
Liabilities and partners' capital
  Current liabilities..................  $ 29.4    $ 14.1      $14.2      $ 43.2    $ 20.8     $18.1
  Long-term debt.......................      --      60.6       52.5          --      64.5      55.1
  Other long-term liabilities..........      --        --         --         2.5        --        --
  Partners' capital....................   426.8      44.2       26.3       414.6      40.9      22.7
  Accumulated other comprehensive
     income............................      --       0.9         --          --        --        --
                                         ------    ------      -----      ------    ------     -----
          Total liabilities and
            partners' capital..........  $456.2    $119.8      $93.0      $460.3    $126.2     $95.9
                                         ======    ======      =====      ======    ======     =====
</Table>

---------------

(1) In March 2001, we acquired the remaining 7.875 percent interest in Bayonne
    Venture from unaffiliated parties. As a result, we are the sole owner of
    Bayonne Venture, whose financial statements were consolidated with East
    Coast Power from March 13, 2001.

                                        5
<PAGE>   7
                            EAST COAST POWER L.L.C.

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

     The following table presents summary income statement information for the
Company's affiliates:

<Table>
<Caption>
                             LINDEN VENTURE            CAMDEN VENTURE            BAYONNE VENTURE
                         -----------------------   -----------------------   -----------------------
                         SIX MONTHS   SIX MONTHS   SIX MONTHS   SIX MONTHS   SIX MONTHS   SIX MONTHS
                           ENDED        ENDED        ENDED        ENDED        ENDED        ENDED
                          JUNE 30,     JUNE 30,     JUNE 30,     JUNE 30,     JUNE 30,     JUNE 30,
                            2001         2000         2001         2000       2001(1)        2000
                         ----------   ----------   ----------   ----------   ----------   ----------
                                                        (IN MILLIONS)
<S>                      <C>          <C>          <C>          <C>          <C>          <C>
Operating revenues
  Electricity..........    $230.4       $154.1       $62.3        $41.0        $56.0        $51.3
  Steam................      19.3          8.9          --           --          4.9          2.9
                           ------       ------       -----        -----        -----        -----
                            249.7        163.0        62.3         41.0         60.9         54.2
                           ------       ------       -----        -----        -----        -----
Operation expenses
  Fuel.................     134.2         83.8        39.6         22.0         38.1         27.0
  Operation and
     maintenance.......      19.5          8.6         2.5          3.2          8.2          4.7
  Depreciation and
     amortization......       8.0          7.7         1.9          1.9          1.5          1.5
  General and
     administrative....       0.9          0.7         0.5          0.5          0.3          0.3
  Taxes, other than
     income taxes......       0.9          0.9         0.2          0.2          0.3          0.3
                           ------       ------       -----        -----        -----        -----
                            163.5        101.7        44.7         27.8         48.4         33.8
                           ------       ------       -----        -----        -----        -----
Operating income.......      86.2         61.3        17.6         13.2         12.5         20.4
                           ------       ------       -----        -----        -----        -----
Other (income) expense
  Interest and other
     income............      (3.5)        (0.4)       (0.2)        (0.3)        (0.8)        (0.2)
  Interest expense.....        --           --         2.9          3.3          3.2          3.6
                           ------       ------       -----        -----        -----        -----
                             (3.5)        (0.4)        2.7          3.0          2.4          3.4
                           ------       ------       -----        -----        -----        -----
          Net income...    $ 89.7       $ 61.7       $14.9        $10.2        $10.1        $17.0
                           ======       ======       =====        =====        =====        =====
</Table>

---------------

(1) In March 2001, we acquired the remaining 7.875 percent interest in Bayonne
    Venture from unaffiliated parties. As a result, we are the sole owner of
    Bayonne Venture whose financial statements were consolidated with East Coast
    Power from March 13, 2001.

                                        6
<PAGE>   8
                            EAST COAST POWER L.L.C.

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

4. DEBT AND FINANCING TRANSACTIONS

     Our debt consisted of the following:

<Table>
<Caption>
                                                              JUNE 30,   DECEMBER 31,
                                                                2001         2000
                                                              --------   ------------
                                                                   (IN MILLIONS)
<S>                                                           <C>        <C>
Long-Term Debt
  Senior secured notes......................................  $  807.2     $  817.1
  Enron subordinated note...................................     187.9        187.9
  Linden Ltd. term loan.....................................     170.1        178.9
  Bayonne term loan.........................................      57.5           --
  Bayonne equipment loan....................................       0.5           --
                                                              --------     --------
                                                               1,223.2      1,183.9
  Less current maturities...................................      51.4         37.7
                                                              --------     --------
Long-term debt less current maturities......................  $1,171.8     $1,146.2
                                                              ========     ========
</Table>

5. INCOME TAXES

     As limited liability companies and partnerships, we are not subject to
state or federal income taxes. Such taxes accrue to our members and,
accordingly, such income taxes have not been recognized in the consolidated
financial statements.

6. INTERIM SWAP LOSS

     Bayonne Venture entered into an electricity swap agreement with an
affiliate to exchange a floating electricity rate, which is derived from the
power purchase agreement, for a fixed rate. The electricity swap expired on May
31, 2001, and Bayonne Venture recognized a $1.4 million loss upon settlement.

7. CAMDEN SWAP

     Camden Venture is a party to a term loan agreement called the Camden
Venture Term Loan with General Electric Capital Corporation (GECC). GECC
assigned a portion of the Camden Venture Term Loan called Tranche A to a group
of banks. Camden Venture has entered into an interest rate swap agreement with
GECC to fix the LIBOR portion of the interest rate with respect to Tranche A at
5.945%. The swap agreement has a notional amount equal at all times to the
outstanding principal balance of Tranche A. As of June 30, 2001, Camden Venture
recorded an unrealized interest rate swap gain of $0.9 million in other
comprehensive income.

8. COMMITMENTS AND CONTINGENCIES

  Linden 6 Expansion Project

     During February 2000, we entered into an energy services agreement (the
ESA) with Tosco Refining L.P. (Tosco), a subsidiary of Tosco Corporation, under
which we are required to construct, own, and operate the Linden 6 facility, a
172-megawatt cogeneration facility on part of the existing Linden site under a
sublease entered into with Cogen Technologies Linden Venture L.P. (Linden
Venture). Linden 6 will be owned and operated by a wholly owned subsidiary of
our Company. The estimated $107 million cost of Linden 6 will be financed with
cash flow from operations and owner capital contributions. The ESA contemplates
an in-service date of January 8, 2002. In the event Linden 6 is not in service
by January 23, 2002, the ESA requires the Company to make delay payments in the
amount of $18,000 per day for the first 60 days and $36,000 for each day
thereafter. In connection with the ESA, we entered into a $91.8 million, fixed
price,

                                        7
<PAGE>   9
                            EAST COAST POWER L.L.C.

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

engineering, procurement and construction agreement (the EPC) with National
Energy Production Corporation (NEPCO), an affiliate of Enron. Under the EPC,
NEPCO has guaranteed completion of Linden 6 by late October 2001. Linden 6 is
expected to be fully operational during the last quarter of 2001. Total
expenditures for Linden 6 were $91.6 million as of June 30, 2001, which have
been capitalized as construction in progress. Interest costs related to the
construction of Linden 6 are capitalized to construction in progress. We
capitalized interest of $6.2 million as of June 30, 2001, and $1.8 million as of
June 30, 2000.

     In connection with obtaining the consent of the Linden Venture partners and
lenders for the transactions, we have indemnified Linden Venture from any and
all losses that may be incurred as a result of Linden 6. Enron and El Paso
guaranteed the Company's obligations under this indemnity in an aggregate amount
of $15.0 million. In connection with El Paso gaining control of the Company,
Enron's obligation under the guarantee was assumed by El Paso.

  Legal Proceedings

     On June 30, 2000, Infineum USA L.P. (Infineum) filed an action against
Linden Venture in the United States District Court for the District of New
Jersey seeking an unspecified amount of actual and punitive damages. Infineum's
petition claims that Linden Venture interfered with Infineum's ability to sell
to Bayway Refining Company (Bayway), a subsidiary of Tosco, steam that Infineum
purchases from the Linden facility. Infineum claims that such interference is in
violation of federal and New Jersey antitrust laws, is in breach of Linden
Venture's agreement with Infineum and tortuously interferes with Infineum's
economic relationships with Bayway. Linden Venture filed an answer, and a
counterclaim on September 26, 2000. On September 28, 2000, an initial scheduling
conference was held before the court. During the scheduling conference, Linden
Venture asked the court to initially limit discovery to resolve the fundamental
issue of whether Infineum is indeed a competitor of Linden Venture with standing
to bring antitrust claims. The court, by order dated October 11, 2000, granted
the request of Linden Venture and set an expedited discovery schedule limited to
the standing issue. The order also granted Linden Venture the option to submit,
at the end of the limited discovery period, a dispositive motion challenging
Infineum's standing to bring its antitrust claims. Linden Venture filed its
motion on January 5, 2001, in accordance with court rules. Management believes
the claims made in this litigation are without merit, and management intends to
vigorously defend against these claims. Although no assurances can be given,
management believes that based upon information known to date, the ultimate
resolution of this litigation will not have a material adverse effect on Linden
Venture's or the Company's financial position, operating results, or cash flows.
In connection with the Infineum action, Linden Venture has recorded estimated
legal expenses of $2.0 million.

     The McNair interests have indemnified the Company against any and all
damages, losses, liabilities and expenses with respect to an environmental
lawsuit filed in Louisiana state court against a predecessor entity of McNair
Energy Services Corporation.

     While the outcome of the matters discussed above cannot be predicted with
certainty, we do not expect that the ultimate resolution of these matters, based
upon information known to date, will have a material adverse effect on our
financial position, results of operations, or cash flows.

9. RESTRUCTURING OF POWER PURCHASE AGREEMENTS

     On May 22, 2001, we reached an agreement, subject to lender, partner, and
other unaffiliated party approval and on-going negotiations, with the Public
Services Electric and Gas Company of New Jersey (PSE&G) to restructure the
long-term PSE&G power purchase agreements relating to our Camden Cogen L.P.
(Camden) and Bayonne facilities. Completion of the restructuring is subject to
customary conditions to closing for similar transactions, including prior
approval by the New Jersey Board of Public Utilities (NJBPU). On July 19, 2001,
the NJBPU approved the restructuring, however, we received written

                                        8
<PAGE>   10
                            EAST COAST POWER L.L.C.

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

approval on July 27, 2001, pending the expiration of a 45-day waiting period.
However, since many of the conditions to closing are outside of our control, we
cannot assure that we will be able to complete the restructuring. We also agreed
with PSE&G to modifications of the PSE&G gas service agreements relating to the
Camden and Bayonne facilities effective upon the consummation of the
restructuring.

     If the restructuring is consummated, our Camden and Bayonne facilities will
be released from their obligations under their current power purchase agreements
with PSE&G. Under the current power purchase agreements, PSE&G is required to
purchase all power produced by our Camden facility, and approximately 24 percent
of the electrical output at the Bayonne facility, at established prices. If the
restructuring is completed, we expect to operate the Camden facility and
approximately 24 percent of the electrical output of the Bayonne facility as
merchant facilities. Upon the Camden restructuring, the facility will qualify as
an exempt wholesale generator under the Energy Policy Act of 1992, rather than a
qualifying facility under the Public Utility Regulatory Policies Act of 1978. If
the restructuring is implemented, the cash flows from the Camden facility and
approximately 24 percent of the output of the Bayonne facility relating to the
PSE&G contract will be subject to conditions in the wholesale electric market.
It is likely that our financial position, operation results, and cash flows will
be more volatile, than if the restructuring were not implemented, and the
long-term power purchase contracts with PSE&G remained in place. Such volatility
in our cash flows from the affected facilities could in turn adversely affect
the distributions we receive and, therefore, our ability to pay the notes and
our other debt. In conjunction with the restructuring of the power purchase
agreements, and due to the uncertainty of the electric market demand for the
Camden facility and a portion of the Bayonne facility, the plants could be
impaired. Such impairments, if so incurred, would result in the plants being
written down to the post-restructuring fair market value. These potential
impairments could have a material adverse effect on our financial position,
results of operations, or cash flows.

     The restructuring could be deemed a power contract buyout under the
indenture executed in connection with our notes, in which case we expect to seek
confirmation from the rating agencies that the restructuring will not cause a
Rating Downgrade. As a power contract buyout, the restructuring could result in
the mandatory redemption of all or a portion of our notes without premium.

10. NEW ACCOUNTING PRONOUNCEMENTS NOT YET ADOPTED

  Goodwill and Other Intangible Assets

     In July 2001, the Financial Accounting Standards Board (FASB) issued SFAS
No. 142, Goodwill and Other Assets. This statement requires that goodwill no
longer be amortized but intermittently tested for impairment at least on an
annual basis. Other intangible assets are to be amortized over their useful life
and reviewed for impairment in accordance with the provisions of SFAS No. 121,
Accounting for the Impairment of Long-Lived Assets and Long-Lived Assets to be
Disposed of. An intangible asset with an indefinite useful life can no longer be
amortized until its useful life becomes determinable. This statement has various
effective dates, the most significant of which is January 1, 2002. We are
currently evaluating the effects of this pronouncement.

  Accounting for Asset Retirement Obligations

     In July 2001, the FASB approved for issuance SFAS No. 143, Accounting for
Asset Retirement Obligations. This statement requires companies to record a
liability relating to the retirement and removal of assets used in their
business. The liability is discounted to the present value, and the related
asset value is increased by the amount of the resulting liability. Over the life
of the asset, the liability will be accreted to its future value and eventually
extinguished when the asset is taken out of service. The provisions of this
statement are effective for fiscal years beginning after June 15, 2002. We are
currently evaluating the effects of this pronouncement.

                                        9
<PAGE>   11
                            EAST COAST POWER L.L.C.

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

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

     The information contained in Item 2 should be read in conjunction with
information disclosed in our amended registration statement on Form S-4/A
(Registration No. 333-45124) dated August 8, 2001, in addition to the financial
statements and notes presented in Item 1, Financial Statements, of this
Quarterly Report on Form 10-Q.

GENERAL

     East Coast Power L.L.C. (the Company) is a Delaware limited liability
company. Through its affiliates, El Paso Corporation (El Paso) obtained control
of the Company through a series of transactions consummated on February 22, 2001
and February 23, 2001. As a result of these transactions, El Paso indirectly
owns a common interest in the Company with a 99% sharing ratio, and Enron North
America (Enron), through its affiliate, East Coast Power Holding Company L.L.C.,
retains a preferred interest in the Company with a 1% sharing ratio. The
financial statements have not been adjusted to fair market value because we have
publicly traded debt. In connection with El Paso obtaining control of the
Company, $157.9 million of the Enron subordinated note was assigned to an
affiliate of El Paso, and the remaining $30 million resides with an affiliate of
Enron.

INTEREST IN BAYONNE VENTURE

     In December 2000, we acquired an additional 0.375 percent partnership
interest in Cogen Technologies NJ Venture (Bayonne Venture) from an unaffiliated
party. In March 2001, the Company acquired the remaining 7.875 percent
partnership interests in Bayonne Venture from unaffiliated parties.

ADMINISTRATIVE AND GAS SERVICES SUPPORT AGREEMENT

     We utilize the officers, employees and management services of El Paso,
under the administrative and gas services support agreement to manage the
day-to-day operations of our company. Effective as of April 1, 2001, we entered
into the administrative and gas services support agreement with El Paso to
provide gas management, administrative, accounting, and finance services for the
Company. The administrative and gas services support agreement originally
provides for an annual fee of $3.6 million adjusted annually for increases in
the Consumer Price Index and is renewed annually.

POWER PURCHASE AGREEMENTS

     Our facilities sell their electric output pursuant to long-term power
purchase agreements with investor-owned utilities. Each of our utility power
purchasers has an investment-grade senior debt rating. Our facilities
historically have provided consistent and substantial cash distributions,
reflecting in part the fixed payment components of the power purchase
agreements.

     The power purchase agreements for our facilities typically include a fixed
capacity payment, an escalating operation and maintenance payment tied to an
inflation index and a fuel expense component tied to the utility's weighted
average cost of gas (WACOG) or another measure. The fuel components of the
Camden Cogen L.P. (Camden) and Bayonne power purchase agreements historically
have been well correlated to our actual fuel costs. The fuel component in one of
the Bayonne agreements is based on the utility's prior year's WACOG resulting in
a lag between reimbursement of fuel costs and actual costs.

     The fuel component in the Cogen Technologies Linden Venture, L.P. (Linden
Venture) power purchase agreement is based on a cap indexed to the purchaser's,
Consolidated Edison's (Con Ed's), weighted average cost of gas. Con Ed
reimburses the project for Linden Venture's actual fuel costs throughout the
year. At the

                                        10
<PAGE>   12
                            EAST COAST POWER L.L.C.

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

end of the contract year (April 30), actual costs are compared to the cap. If
Linden Venture's fuel costs exceed the cap, Linden Venture reimburses Con Ed for
the excess over the next 12 months. If fuel costs are below the cap, Linden
Venture and Con Ed split the difference on a 50/50 basis, and Con Ed reimburses
Linden Venture for its share of the savings over the next 12 months.

     As a result of Con Ed's divestiture of its gas-fired electric generation
assets and further anticipated changes in its gas-purchasing portfolio, Con Ed
has initiated negotiations with us to modify the existing fuel component of the
power purchase agreement. In addition, we are discussing with Con Ed the
methodology of calculating the WACOG in light of Con Ed's acquisition of Orange
and Rockland Utilities. We do not believe that modification to the existing fuel
component, if any, will have a material adverse effect on the financial position
or results of operations of Linden Venture or our Company.

  Interim Operating Agreements

     During 2000, Camden Venture entered into an interim operating agreement
with the Public Services Electric and Gas Company of New Jersey (PSE&G). Under
this agreement, Camden Venture agreed to shut down the Camden Venture facility
from November 1, 2000 through May 31, 2001, to allow PSE&G to resell the gas
otherwise provided to the facility under the gas service agreement. In return,
Camden Venture realized an energy and capacity payment equal to 149 megawatts
per hour, every hour, for the term of the agreement plus 50 percent of the
savings realized by PSE&G in this transaction.

     For various economic reasons, effective January 23, 2001, Bayonne Venture
chose to reduce electric output to the minimum level necessary to serve its
steam customers. Simultaneously, Bayonne Venture entered into interim operating
agreements with PSE&G and Jersey Central Power and Light (JCP&L). PSE&G, in its
interim operating agreement, agreed to accept 100 percent of the electricity
generated from this reduced output (up to approximately 45 megawatts). The term
of the interim operating agreement was from January 23, 2001 through May 31,
2001. As an incentive to enter into this agreement, PSE&G agreed to accept
payment of $1.8 million. PSE&G also agreed to waive any variable demand-wheeling
charges (approximately $40,000 per month) it would have otherwise collected from
Bayonne Venture to wheel electricity to JCP&L. JCP&L, in its interim operating
agreement, agreed not to accept any generation from Bayonne Venture in return
for a 5 percent discount off the power purchase agreement rates. Bayonne Venture
gave a rebate to JCP&L for the value of the power it would have otherwise
provided (125 megawatts) at wholesale market rates known as day-ahead locational
marginal pricing in the Pennsylvania Jersey Maryland system. Bayonne Venture
entered into an electricity swap agreement with an affiliate to exchange a
floating electricity rate, which was derived from the power purchase agreement,
for a fixed rate. The electricity swap expired on May 31, 2001, and Bayonne
Venture recognized a $1.4 million loss upon settlement.

     Effective June 1, 2001, both the Camden and Bayonne facilities resumed
normal operations. As a result of the interim operating agreements, the Camden
facility improved operating results by approximately $6.9 million from November
1, 2000 through May 31, 2001, and the Bayonne facility improved operating
results by approximately $5.2 million from January 23, 2001 through May 31,
2001.

RESULTS OF OPERATIONS

     The following are our results by each of our affiliates for the second
quarter 2001 compared to second quarter 2000 and for the six months ended June
30, 2001 compared to six months ended June 30, 2000. The operating results
discussed below are not necessarily indicative of the results that may be
achieved for any subsequent or prior three or six month period or for a full
year.

                                        11
<PAGE>   13
                            EAST COAST POWER L.L.C.

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

  Second Quarter 2001 Compared to Second Quarter 2000

     Operating revenues for the quarter ended June 30, 2001, were $68.2 million
compared to $13.0 million for the same period ended in 2000. The increase was
due to the Linden pass through of fuel costs and the purchase of the remaining
partnership interests in Bayonne Venture in March 2001. As the sole owner of
Bayonne Venture, Bayonne Venture's results of operations are presented on a
consolidated basis beginning March 13, 2001. For the quarter ended June 30,
2001, we received $35.2 million in cash distributions and $36.8 million during
the quarter ended June 30, 2000.

          Linden Venture.  Revenues increased by $34.4 million, or 41.1 percent,
     to $118.2 million for the quarter ended June 30, 2001, compared to $83.8
     million for the quarter ended June 30, 2000. Electricity revenues increased
     by $29.4 million, or 37.2 percent, primarily as a result of a $17.5 million
     increase in pass-through fuel costs to Con Ed under the power purchase
     agreement, $8.7 million increase in the fuel component, and a $1.0 million
     increase in capacity. The increase in the fuel component was primarily due
     to a 16.4 percent increase in fuel costs as a result of higher natural gas
     prices. Steam revenues increased by $5.0 million, or 104.2 percent,
     primarily due to $4.1 million in steam sales to Infineum and higher price
     of steam due to the fuel costs as described above. Historically, the
     high-tension service (HTS) rate exceeded the price of steam, however, for
     the annual period ended April 2001, the cost of steam was higher. Costs and
     expenses were $66.0 million for the quarter ended June 30, 2001, compared
     to $54.6 million for the quarter ended June 30, 2000. This increase is due
     to the increase in fuel costs as described above, and a $3.7 million
     increase in operation and maintenance expenses for major overhauls
     performed in 2001.

          Linden Venture reported net income of $53.1 million for the quarter
     ended June 30, 2001, compared to net income of $29.4 million for the
     quarter ended June 30, 2000. Our company was allocated earnings of $45.8
     million for the quarter ended June 30, 2001, and $23.2 million for the same
     period ended in 2000. Our share of Linden Venture's earnings was included
     in our results of operations and reported net of $11.0 million of
     amortization of the excess of our investment over our share of Linden
     Venture's equity for the quarter ended June 30, 2001 and 2000.

          Linden Venture made cash distributions of $41.2 million during the
     quarter ended June 30, 2001, compared to cash distributions of $33.1
     million during the quarter ended June 30, 2000. The increase is primarily
     the result of improved profitability as described above. Our company's
     share of these distributions was $30.6 million for the quarter ended June
     30, 2001, compared to $23.3 million for the quarter ended June 30, 2000.

          Camden Venture.  Revenues increased by $5.6 million, or 26.9 percent,
     to $26.4 million for the quarter ended June 30, 2001, compared to $20.8
     million for the quarter ended June 30, 2000. This increase was a result of
     a 37.3 percent increase in fuel component revenues primarily due to higher
     natural gas prices and $1.3 million in revenues earned in accordance with
     the interim operating agreement effective November 1, 2000 through May 31,
     2001. Costs and expenses increased by $3.8 million, or 25.5 percent, to
     $18.7 million for the quarter ended June 30, 2001, compared to $14.9
     million for the quarter ended June 30, 2000. This increase resulted from a
     $4.4 million increase in fuel costs, mostly attributable to a 27 percent
     increase in fuel rates, partially offset by lower planned maintenance
     costs.

          Camden Venture reported earnings of $6.3 million for the quarter ended
     June 30, 2001, compared to earnings of $4.2 million for the quarter ended
     June 30, 2000. Our company was allocated earnings of $4.5 million for the
     quarter ended June 30, 2001, and $2.5 million for the same period ended in
     2000. Our share of Camden Venture's earnings is included in our results of
     operations and was reported net of $3.2 million of amortization of the
     excess of our investment over our share of Camden Venture's equity for the
     quarter ended June 30, 2001 and 2000.

                                        12
<PAGE>   14
                            EAST COAST POWER L.L.C.

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

          Camden Venture made cash distributions of $5.6 million during the
     quarter ended June 30, 2001, compared to cash distributions of $3.1 million
     during the quarter ended June 30, 2000. Our company's share of these
     distributions was $4.7 million for the quarter ended June 30, 2001,
     compared to $2.4 million for the quarter ended June 30, 2000.

          Bayonne Venture.  Revenues increased by $5.2 million, or 19.3 percent,
     to $32.1 million for the quarter ended June 30, 2001, compared to $26.9
     million for the quarter ended June 30, 2000. This increase was the result
     of a 22.1 percent increase in the JCP&L electric rate (which represents
     approximately 75 percent of the Bayonne Venture's electric revenues
     sources) due to higher natural gas prices. Costs and expenses increased by
     $4.0 million, or 22.9 percent, to $21.5 million for the quarter ended June
     30, 2001, compared to $17.5 million for the quarter ended June 30, 2000.
     This increase was due to a $2.7 million increase in fuel costs due to
     higher natural gas prices and $1.3 million in planned maintenance costs
     partially offset by $0.4 million in obsolete parts sold to third parties.

          Bayonne Venture reported earnings of $9.5 million for the quarter
     ended June 30, 2001, compared to earnings of $7.6 million for the quarter
     ended June 30, 2000. Our company was consolidated for the quarter ended
     June 30, 2001 and therefore was not allocated earnings for this period,
     compared to allocated earnings of $7.0 million for the quarter ended June
     30, 2000. Bayonne Venture's earnings were included in our results of
     operations through consolidation and were reported net of $5.8 million and
     $5.5 million of amortization of the excess of our investment over our share
     of Bayonne Venture's equity for the quarter ended June 30, 2001 and 2000.

          Bayonne Venture made cash distributions of $4.5 million during the
     quarter ended June 30, 2001, compared to cash distributions of $12.1
     million during the quarter ended June 30, 2000. Our company's share of
     these distributions was $4.5 million for the quarter ended June 30, 2001,
     compared to $11.1 million for the quarter ended June 30, 2000.

     General and administrative costs for our company were $1.6 million for the
quarter ended June 30, 2001, compared to costs of $1.6 million for the quarter
ended June 30, 2000. Lower costs were primarily due to a decrease in payroll
costs. Interest expense decreased by $0.5 million to $22.3 million at June 30,
2001, compared to $22.8 million for the quarter ended June 30, 2000, due to the
increase of capitalized construction costs and a lower outstanding debt balance.

  Six Months Ended June 30, 2001 Compared to Six Months Ended June 30, 2000

     Operating revenues for the six months ended June 30, 2001, were $93.0
million, compared to $31.1 million for the same period in 2000. The increase was
due to the Linden pass through of fuel costs and the purchase of the remaining
partnership interests in Bayonne Venture in March 2001. As the sole owner of
Bayonne Venture, Bayonne Venture's results of operations are presented on a
consolidated basis beginning March 13, 2001. For the six months ended June 30,
2001, we received $68.8 million in cash distributions and $87.3 million during
the six months ended June 30, 2000.

          Linden Venture.  Revenues increased by $86.7 million, or 53.2 percent,
     to $249.7 million for the six months ended June 30, 2001, compared to
     $163.0 million for the six months ended June 30, 2000. Electricity revenues
     increased by $76.3 million, or 49.5 percent, primarily as a result of a
     $18.5 million increase in pass-through fuel costs to Con Ed under the power
     purchase agreement, $50.4 million increase in the fuel component, and a
     $4.1 million increase in capacity. The increase in the fuel component was
     primarily due to an increase in fuel costs as a result of higher natural
     gas prices. Steam revenues increased by $10.4 million, or 116.9 percent,
     primarily due to $4.1 million in steam sales to Infineum and higher price
     of steam due to the fuel costs as described above. Historically, the HTS
     rate exceeded the price of steam, however, for the annual period ending
     April 2001, the cost of steam was higher. Costs and expenses were $163.5
     million for the six months ended June 30, 2001, compared to

                                        13
<PAGE>   15
                            EAST COAST POWER L.L.C.

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

     $101.7 million for the six months ended June 30, 2000. This increase was
     due to the increase in fuel costs as described above and a $10.9 million
     increase in operation and maintenance expenses as a result of major
     overhauls performed in 2001.

          Linden Venture reported net income of $89.7 million for the six months
     ended June 30, 2001, compared to net income of $61.7 million for the six
     months ended June 30, 2000. Our company was allocated earnings of $76.0
     million for the six months ended June 30, 2001, and $48.0 million for the
     same period ended in 2000. Our share of Linden Venture's earnings was
     included in our results of operations and reported net of $22.0 million of
     amortization of the excess of our investment over our share of Linden
     Venture's equity for the six months ended June 30, 2001 and 2000.

          Linden Venture made cash distributions of $77.5 million during the six
     months ended June 30, 2001, compared to cash distributions of $81.1 million
     during the six months ended June 30, 2000. The decrease was the result of
     the distribution of $11.7 million of excess cash in the first quarter of
     2000. Our company's share of these distributions was $56.9 million for the
     six months ended June 30, 2001, compared to $60.1 million for the six
     months ended June 30, 2000.

          Camden Venture.  Revenues increased by $21.3 million, or 52.0 percent,
     to $62.3 million for the six months ended June 30, 2001, compared to $41.0
     million for the six months ended June 30, 2000. This increase was a result
     of a 104.4 percent increase in fuel component revenues primarily due to
     higher natural gas prices and transaction revenues earned in accordance
     with the interim operating agreement effective November 1, 2000 through May
     31, 2001. Costs and expenses increased by $16.9 million, or 60.8 percent,
     to $44.7 million for the six months ended June 30, 2001, compared to $27.8
     million for the six months ended June 30, 2000. This increase was primarily
     due to a $17.6 million increase in fuel costs resulting from higher natural
     gas prices.

          Camden Venture reported earnings of $14.9 million for the six months
     ended June 30, 2001, compared to earnings of $10.2 million for the six
     months ended June 30, 2000. Our company was allocated earnings of $11.2
     million for the six months ended June 30, 2001, and $6.9 million for the
     same period ended in 2000. Our share of Camden Venture's earnings was
     included in our results of operations and reported net of $6.4 million of
     amortization of the excess of our investment over our share of Camden
     Venture's equity for the six months ended June 30, 2001 and 2000.

          Camden Venture made cash distributions of $11.6 million during the six
     months ended June 30, 2001, compared to cash distributions of $8.6 million
     during the six months ended June 30, 2000. Our company's share of these
     distributions was $10.0 million for the six months ended June 30, 2001,
     compared to $6.9 million for the six months ended June 30, 2000.

          Bayonne Venture.  Revenues increased by $6.7 million, or 12.4 percent,
     to $60.9 million for the six months ended June 30, 2001, compared to $54.2
     million for the six months ended June 30, 2000. Costs and expenses
     increased by $14.6 million, or 43.2 percent, to $48.4 million for the six
     months ended June 30, 2001, compared to $33.8 million for the same period
     ended in 2000. This increase resulted from an $11.1 million, or 41.1
     percent, increase in fuel costs, mostly attributable to a 66.0 percent
     increase in fuel rates and higher planned maintenance costs.

          Bayonne Venture reported earnings of $10.1 million for the six months
     ended June 30, 2001, compared to earnings of $17.0 million for the six
     months ended June 30, 2000. Our company was allocated earnings of $0.7
     million for the six months ended June 30, 2001, compared to earnings of
     $15.6 million for the six months ended June 30, 2000. Our share of Bayonne
     Venture's earnings was included in our results of operations through March
     12, 2001, and was reported net of $4.3 million and $11.0 million of
     amortization of the excess of our investment over our share of Bayonne
     Venture's equity for the period ended March 12, 2001, and June 30, 2000.
     Additionally, amortization of excess costs of $7.1 million was recorded for
     the period from March 13, 2001 through June 30, 2001.
                                        14
<PAGE>   16
                            EAST COAST POWER L.L.C.

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

          Bayonne Venture made cash distributions of $6.6 million during the six
     months ended June 30, 2001, compared to cash distributions of $22.1 million
     during the six months ended June 30, 2000. Our company's share of these
     distributions was $6.4 million for the six months ended June 30, 2001,
     compared to $20.3 million for the six months ended June 30, 2000.

     General and administrative costs for our company were $3.4 million for the
six months ended June 30, 2001, compared to costs of $3.9 million in the six
months ended June 30, 2000. Lower costs were primarily due to a decrease in
payroll costs. Interest expense decreased by $2.2 million to $44.1 million at
June 30, 2001, compared to $46.3 million for the six months ended June 30, 2000,
due to the increase of capitalized construction costs and a lower outstanding
debt balance.

     Our loan agreements require us to maintain compliance with certain
financial covenants. We believe that we are in compliance with the terms and
conditions of the loan agreements as of June 30, 2001.

LIQUIDITY AND CAPITAL RESOURCES

  Acquisition Financing

     We financed the acquisition in part with an $831 million bridge loan and a
$250 million subordinated note originally issued by us to Enron. We repaid all
amounts outstanding under the bridge loan and $62.1 million of the amount
outstanding under the Enron subordinated note with the proceeds of the offering
of the outstanding senior secured notes and an equity contribution by Joint
Energy Development Investments II Limited Partnership (JEDI II). In connection
with El Paso obtaining control of the Company, $157.9 million of the Enron
subordinated note was assigned to an affiliate of El Paso, and the remaining $30
million resides with Enron, effective February 23, 2001. This subordinated note
bears interest at 9% per annum and matures on July 15, 2017.

     On April 20, 1999, we sold $850.0 million of senior secured notes in three
tranches as follows: $296.0 million of 6.737% notes due 2008, $236.0 million of
7.066% notes due 2012, and $318.0 million of 7.536% notes due 2017. The 2008
notes are repayable in 36 quarterly installments of varying amounts beginning on
June 30, 1999, with the final payment due March 31, 2008. The 2012 notes are
repayable in 17 quarterly installments of varying amounts beginning on March 31,
2008, with the final payment due March 31, 2012. The 2017 notes are repayable in
22 quarterly installments of varying amounts beginning on March 31, 2012, with
the final payment due June 30, 2017. Interest on the outstanding notes is
payable quarterly, with the first interest payment made on June 30, 1999.

     The outstanding notes are senior secured obligations, which rank senior in
right of payment to all existing and future subordinated indebtedness and pari
passu in right of payment with all existing and future senior secured
indebtedness. In addition, the outstanding notes are structurally subordinated
to all indebtedness and other liabilities, including trade payables, of our
subsidiaries and to the distribution rights of minority partners in the
ventures. The outstanding notes are secured by the pledge by our owners of their
interests in our Company, our pledge of our ownership interests in certain of
our subsidiaries that own indirect interests in the facilities, and the pledge
of Linden Ltd.'s $289.6 million intercompany subordinated note payable to us.

     The terms of the outstanding notes limit our ability to pay dividends,
incur additional indebtedness, make payments on subordinated debt, and make
certain other restricted payments. The terms of the outstanding notes also
require us to fund a debt service reserve account unless we provide acceptable
debt service credit support in the form of an undertaking or an acceptable
letter of credit. El Paso has provided the required undertaking, and, therefore,
we are not currently funding the debt service reserve account.

     In December 2000, we acquired an additional 0.375 percent partnership
interest in Bayonne Venture from an unaffiliated party. In March 2001, we
acquired the remaining 7.875 percent interest in Bayonne Venture from
unaffiliated parties. As a result, we are the sole owner of Bayonne Venture. We
financed these

                                        15
<PAGE>   17
                            EAST COAST POWER L.L.C.

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

acquisitions primarily through cash contributions from Mesquite Investors L.L.C.
and Bonneville Pacific Corporation.

     Through its affiliates, El Paso obtained control of the Company through a
series of transactions consummated on February 22, 2001 and February 23, 2001.
As a result of these transactions, El Paso indirectly owns a common interest in
the Company with a 99 percent sharing ratio, and Enron, through its affiliates,
retain a preferred interest in the Company with a 1 percent sharing ratio.

     Because the ratings assigned to our notes were confirmed by the rating
agencies following the change in ownership, we were not required to offer to
repurchase the notes after that change in ownership, as defined in the
indenture. While the change in ownership represents a change in control, the
financial statements have not been adjusted to fair market value because we have
publicly traded debt.

  Capital Expenditures

     During February 2000, we entered into an energy services agreement (the
ESA) with Tosco Refining L.P. (Tosco), a subsidiary of Tosco Corporation, under
which we are required to construct, own and operate the Linden 6 facility, a 172
megawatt cogeneration facility on part of the existing Linden site under a
sublease entered into with Linden Venture. Linden 6 will be owned and operated
by a wholly owned subsidiary of our Company. The estimated $107 million cost of
Linden 6 will be financed with cash flow from operations and owner capital
contributions. The ESA contemplates an in-service date of January 8, 2002. In
the event Linden 6 is not in service by January 23, 2002, the ESA requires the
Company to make delay payments in the amount of $18,000 per day for the first 60
days and $36,000 for each day thereafter. In connection with the ESA, we entered
into a $91.8 million, fixed price, engineering, procurement and construction
agreement (the EPC) with National Energy Production Corporation (NEPCO), an
affiliate of Enron. Under the EPC, NEPCO has guaranteed completion of Linden 6
by late October 2001. Linden 6 is expected to be fully operational during the
last quarter of 2001. Total expenditures for Linden 6 were $91.6 million as of
June 30, 2001, which have been capitalized as construction in progress. Interest
costs related to the construction of Linden 6 are capitalized to construction in
progress. We capitalized interest of $6.2 million as of June 30, 2001, and
interest of $1.8 million as of June 30, 2000.

     In addition to the EPC, we also entered into a ground lease with Tosco to
provide a site for the interconnection of Linden 6, and three additional ground
leases with Bayway Refining Company (Bayway), a subsidiary of Tosco, to provide
sites for future development projects. Required consent has been obtained from
the Linden Venture partners and lenders for these transactions.

     In connection with obtaining the consent of the Linden Venture partners and
lenders for the transactions, we have indemnified Linden Venture from any and
all losses that may be incurred as a result of Linden 6. Enron and El Paso have
guaranteed the Company's obligations under this indemnity in an aggregate amount
of $15.0 million. In connection with El Paso gaining control of the Company,
Enron's obligation under the guarantee was assumed by El Paso.

     In addition, the ESA requires an amendment to the steam sale agreement
between Bayway, a subsidiary of Tosco, and Linden Venture to increase the
minimum amounts of steam Bayway is required to take.

     Future capital expenditures by the Company will be financed by cash flows
from operations and cash contributions by our members.

                                  CAMDEN SWAP

     See Item 1, Financial Statements, Note 7, which is incorporated herein by
reference.

                                        16
<PAGE>   18
                            EAST COAST POWER L.L.C.

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

                          COMMITMENT AND CONTINGENCIES

     See Item 1, Financial Statements, Note 8, which is incorporated herein by
reference.

                   RESTRUCTURING OF POWER PURCHASE AGREEMENTS

     See Item 1, Financial Statements, Note 9, which is incorporated herein by
reference.

                 NEW ACCOUNTING PRONOUNCEMENTS NOT YET ADOPTED

     See Item 1, Financial Statements, Note 10, which is incorporated herein by
reference.

      CAUTIONARY STATEMENT FOR PURPOSES OF THE "SAFE HARBOR" PROVISIONS OF
              THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995

     This report contains or incorporates by reference forward-looking
statements within the meaning of the Private Securities Litigation Reform Act of
1995. Where any forward-looking statement includes a statement of the
assumptions or bases underlying the forward-looking statement, we caution that,
while we believe these assumptions or bases to be reasonable and to be made in
good faith, assumed facts or bases almost always vary from the actual results,
and the differences between assumed facts or bases and actual results can be
material, depending upon the circumstances. Where, in any forward-looking
statement, we or our management express an expectation or belief as to future
results, that expectation or belief is expressed in good faith and is believed
to have a reasonable basis. We cannot assure you, however, that the statement of
expectation or belief will result or be achieved or accomplished. The words
"believe," "expect," "estimate," "anticipate" and similar expressions will
generally identify forward-looking statements.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

     Our Company's exposure to interest rate risk results from the Linden Ltd.
term loan. In regards to the floating rate and working capital portion of this
loan, a 10% fluctuation in LIBOR rates and in financial commercial paper rates
in effect during 2001 would not have a material adverse effect on our financial
position, operation results, or cash flows.

                                        17
<PAGE>   19

                          PART II -- OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

     See Part I, Item 1, Financial Statements, Note 8, which is incorporated
herein by reference.

ITEM 2. EXHIBITS AND REPORTS ON FORM 8-K

     a. Exhibits

          None.

     b. Reports on Form 8-K

          None.

                                        18
<PAGE>   20

                                   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.

                                          EAST COAST POWER L.L.C.

Date: September 7, 2001                          /s/ JOHN L. HARRISON
                                          --------------------------------------
                                                     John L. Harrison
                                                  Vice President, Senior
                                                    Managing Director
                                              (Principal Financial Officer)

Date: September 7, 2001                         /s/ CECILIA T. HEILMANN
                                          --------------------------------------
                                                   Cecilia T. Heilmann
                                                 Vice President, Managing
                                                 Director and Controller
                                              (Principal Accounting Officer)

                                        19