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

FORM 10-Q

(Mark One)

~~(X)~~ 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~~

orFor the quarterly period ended June 30, 2006

~~( ) TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from ___________to__________~~ or

Commission	Registrant, State of Incorporation,	I.R.S. Employer
File Number	Address and Telephone Number	Identification No.
1-11377	CINERGY CORP.	31-1385023
	(A Delaware Corporation) 139 East Fourth Street Cincinnati, Ohio 45202 (513) 421-9500
1-1232	THE CINCINNATI GAS & ELECTRIC COMPANY	31-0240030
	(An Ohio Corporation) 139 East Fourth Street Cincinnati, Ohio 45202 (513) 421-9500
1-3543	PSI ENERGY, INC.	35-0594457
	(An Indiana Corporation) 1000 East Main Street Plainfield, Indiana 46168 (513) 421-9500
2-7793	THE UNION LIGHT, HEAT AND POWER COMPANY	31-0473080
	(A Kentucky Corporation) 139 East Fourth Street Cincinnati, Ohio 45202 (513) 421-9500

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

~~Indicate~~For ~~by check mark whether~~ the ~~registrants (1) have filed all reports required to be filed by~~transition ~~Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter~~ period ~~that the registrants were required~~ from to ~~file such reports), and (2) have been subject to such filing requirements for the past 90 days. Yes X No __~~

This combined Form 10-Q is separately filed by Cinergy Corp., The Cincinnati Gas & Electric Company, PSI Energy, Inc., and The Union Light, Heat and Power Company. Information contained herein relating to any individual registrant is filed by such registrant on its own behalf. Each registrant makes no representation as to information relating to the other registrants.

Commission File Number	Registrant, State of Incorporation, Address and Telephone Number	I.R.S. Employer Identification No.

1-11377	CINERGY CORP. (A Delaware Corporation) 139 East Fourth Street Cincinnati, Ohio 45202 (513) 421-9500	31-1385023

1-1232	THE CINCINNATI GAS & ELECTRIC COMPANY (An Ohio Corporation) 139 East Fourth Street Cincinnati, Ohio 45202 (513) 421-9500	31-0240030

1-3543	PSI ENERGY, INC. (An Indiana Corporation) 1000 East Main Street Plainfield, Indiana 46168 (513) 421-9500	35-0594457

~~The~~Indicate ~~Union~~by ~~Light,~~check ~~Heat~~mark ~~and~~whether ~~Power~~the ~~Company~~registrants ~~meets~~(1) ~~the~~have ~~conditions~~filed ~~set~~all ~~forth~~reports inrequired ~~General~~to ~~Instruction~~be filed by ~~H(1)(a)~~Section ~~and~~13 or 15(bd) of ~~Form~~the ~~10-Q~~Securities ~~and~~Exchange isAct ~~therefore~~of ~~filing~~1934 ~~its~~during ~~company~~the ~~specific~~preceding ~~information~~12 ~~with~~months ~~the~~(or ~~reduced~~for ~~disclosure~~such ~~format~~shorter ~~specified~~period inthat ~~General~~the ~~Instruction~~registrants were required to Hfile such reports), and (2) ofhave ~~Form~~been ~~10-Q.~~subject to such filing requirements for the past 90 days.

AsCinergy ofCorp. ~~July~~Yes ~~31,~~x ~~2001,~~No ~~shares~~o ofThe ~~Common~~Cincinnati ~~Stock~~Gas ~~outstanding~~& ~~for~~Electric ~~each~~Company ~~registrant~~Yes ~~were~~x asNo ~~listed:~~o PSI Energy, Inc. Yes x No o

Registrant	Description	Shares
Cinergy Corp.	Par value $.01 per share	159,094,704
The Cincinnati Gas & Electric Company	Par value $8.50 per share	89,663,086
PSI Energy, Inc.	Without par value, stated value $.01 per share	53,913,701
The Union Light, Heat and Power Company	Par value $15.00 per share	585,333

Indicate by check mark whether each registrant is a large accelerated filer, an accelerated filer, or a non-accelerated filer. See definition of “accelerated filer and large accelerated filer” in Rule 12b-2 of the Exchange Act.

~~TABLE~~Large OFAccelerated ~~CONTENTS --------------------------------------------------------------------------------~~ Filer Item Page Number Number ------ ------ PARTAccelerated IFiler ~~FINANCIAL~~Non- ~~INFORMATION 1 Financial~~Accelerated ~~Statements~~ Filer Cinergy Corp. ~~....................................................~~x ~~4 Consolidated~~o ~~Statements~~o of Income............................. 5 Consolidated Balance Sheets................................... 6 Consolidated Statements of Changes in Common Stock Equity..... 8 Consolidated Statements of Cash Flows.........................10 The Cincinnati Gas & Electric Company~~.............................11 Consolidated~~ ~~Statements~~o ofo ~~Income~~x ~~and Comprehensive Income....12 Consolidated Balance Sheets...................................13 Consolidated Statements of Cash Flows.........................15~~ PSI Energy, Inc.~~..................................................16 Consolidated~~ ~~Statements~~o ofo Income and Comprehensive Income....17 Consolidated Balance Sheets...................................18 Consolidated Statements of Cash Flows.........................20 The Union Light, Heat and Power Company...........................21 Statements of Income..........................................22 Balance Sheets................................................23 Statements of Cash Flows......................................25 Notes to Financial Statements..........................................26 Cautionary Statements Regarding Forward-Looking Information............45 2 Management's Discussion and Analysis of Financial Condition and Results of Operations Introduction..................................................47 Organization..................................................47 Liquidity.....................................................48 Capital Resources ............................................50 2001 Quarterly Results of Operations - Historical.............54 2001 Year to Date Results of Operations - Historical..........58 Results of Operations - Future................................63 3 Quantitative and Qualitative Disclosures About Market Risk.............71 PART II OTHER INFORMATION 1 Legal Proceedings......................................................72 6 Exhibits and Reports on Form 8-K.......................................73 Signatures.............................................................74 x

~~CINERGY~~Indicate ~~CORP. CONSOLIDATED~~by ~~STATEMENTS~~check ~~OF INCOME~~mark ~~Quarter~~whether ~~Ended Year~~the toregistrant ~~Date June~~is ~~30 June~~a 30 2001 2000 2001 2000 ---------------------------------------------------------------------------------------------------- (dollarsshell ~~in thousands, except per share amounts)~~ (~~unaudited) Operating~~as Revenues Electric $2,383,217 $1,250,353 $4,257,902 $2,317,050 Gas 1,236,779 491,627 3,050,601 990,355 Other 22,096 27,534 40,118 45,186 ------ ------ ------ ------ Totaldefined Operating Revenues 3,642,092 1,769,514 7,348,621 3,352,591 ---------------------------------------------------------------------------------------------------- Operating Expenses Fuel and purchased and exchanged power 1,855,615 700,552 3,201,496 1,201,330 Gas purchased 1,195,668 449,806 2,906,278 855,951 Operation and maintenance 267,065 297,584 516,555 550,511 Depreciation and amortization 92,203 85,807 180,767 168,438 Taxes other than income taxes 53,409 68,458 116,501 134,589 ------ ------ ------- ------- Total Operating Expenses 3,463,960 1,602,207 6,921,597 2,910,819 ---------------------------------------------------------------------------------------------------- Operating Income 178,132 167,307 427,024 441,772 ---------------------------------------------------------------------------------------------------- Equity in ~~Earnings~~Rule ~~of Unconsolidated Subsidiaries 2,072 4,333 833 6,175 Miscellaneous~~ 12b- ~~Net 13,173~~ 2,617 8,479 114 Interest 68,067 53,113 131,617 104,543 ---------------------------------------------------------------------------------------------------- Income Before Taxes 125,310 121,144 304,719 343,518 ---------------------------------------------------------------------------------------------------- Income Taxes 41,485 44,754 99,789 127,326 Preferred Dividend Requirements of ~~Subsidiaries 858 1,275 1,716 2,638 --- ----- ----- ----- Net~~the ~~Income $ 82,967 $ 75,115 $ 203,214 $ 213,554~~Exchange ========== ========== ========== ========== ---------------------------------------------------------------------------------------------------- Average Common Shares Outstanding 159,061 158,923 159,025 158,923 ---------------------------------------------------------------------------------------------------- Earnings Per Common Share Net Income $ 0Act).~~51 $ 0.47 $ 1.27 $ 1.34~~ ---------------------------------------------------------------------------------------------------- Earnings Per Common Share - Assuming Dilution Net Income $ 0.51 $ 0.47 $ 1.26 $ 1.34 ---------------------------------------------------------------------------------------------------- Dividends Declared Per Common Share $ 0.45 $ 0.45 $ 0.90 $ 0.90 ---------------------------------------------------------------------------------------------------- The accompanying notes as they relate to Cinergy Corp. are an integral part of these consolidated financial statements. Yes o No x

~~CINERGY~~This ~~CORP. CONSOLIDATED~~combined ~~BALANCE~~Form SHEETS ASSETS June 30 December 31 2001 2000 (unaudited) 10-~~-------------------------------------------------------------------------------~~Q ~~(dollars~~is inseparately ~~thousands) Current~~filed ~~Assets Cash~~by ~~and~~Cinergy ~~cash equivalents $ 133~~Corp.,~~204 $ 93,054~~ ~~Restricted~~The ~~deposits 7,528 4,195 Notes~~Cincinnati ~~receivable 25,837 35,945 Accounts~~Gas ~~receivable~~& ~~less~~Electric ~~accumulated provision for doubtful accounts of $35~~Company,~~567 at June 30, 2001,~~ and ~~$29,951~~PSI ~~at December 31, 2000 1,864,630 1,623,402 Materials, supplies, and fuel - at average cost 206,693 159,340~~ Energy ~~risk management current assets (Note 1(c)) 512~~,~~842 1,413,281 Prepayments~~ ~~and~~Inc. Information ~~other 223,193 129,666 ------- ------- Total~~contained ~~Current~~herein ~~Assets 2,973,927 3,458,883 -------------------------------------------------------------------------------- Property,~~relating ~~Plant,~~to ~~and Equipment - at Cost~~any ~~Utility~~individual ~~plant~~registrant inis ~~service 7,887,673 7,681,612 Construction~~filed ~~work~~by insuch ~~progress 360,608 323,350 ------- ------- Total~~registrant ~~Utility~~on ~~Plant 8,248,281 8,004,962 Non-regulated~~its ~~property,~~own ~~plant,~~behalf. Each ~~and~~registrant ~~equipment 4,007,657 3,401,203 Accumulated~~makes ~~depreciation 4,702,197 4,586,089 --------- --------- Net~~no ~~Property,~~representation ~~Plant,~~as ~~and Equipment 7,553,741 6,820,076~~to ~~-------------------------------------------------------------------------------- Other~~information ~~Assets Regulatory~~relating assets 974,507 976,614 Investments in unconsolidated subsidiaries 562,931 538,322 Energy risk management non-current assets (Note 1(c)) 97,157 37,228 Other investments 155,705 146,986 Other 315,590 351,619 ------- ------- Total Other Assets 2,105,890 2,050,769 -------------------------------------------------------------------------------- Total Assets $12,633,558 $12,329,728 =========== =========== -------------------------------------------------------------------------------- The accompanying notes as they relate to ~~Cinergy~~the ~~Corp.~~other ~~are an integral part of these consolidated financial statements~~registrants.

~~CINERGY CORP.~~Cinergy ~~CONSOLIDATED~~Corp., ~~BALANCE~~The ~~SHEETS LIABILITIES~~Cincinnati ~~AND SHAREHOLDERS' EQUITY~~Gas ~~June~~& ~~30 December~~Electric 31 2001 2000 (unaudited) ---------------------------------------------------------------------------------------------------- (dollarsCompany, inand ~~thousands)~~PSI ~~Current Liabilities Accounts payable $ 1~~Energy,~~798,198 $ 1,496,494 Accrued~~ ~~taxes 219,938 247,006 Accrued~~Inc. ~~interest 54,516 47,351 Notes~~meet ~~payable~~the ~~and~~conditions ~~other~~set ~~short-term~~forth ~~obligations~~in ~~(Note 3) 1,653,136 1,128,657~~General ~~Long-term~~Instruction ~~debt due within one year~~ H(~~Note 2) 80,620 40,545 Energy risk management current liabilities (Note~~ 1(c)) 527,645 1,456,375 Other 83,682 106,679 ------ ------- Total Current Liabilities 4,417,735 4,523,107 ---------------------------------------------------------------------------------------------------- Non-Current Liabilities Long-term debt (~~Note 2~~a) ~~3,188,174 2,876,367 Deferred~~ ~~income taxes 1,198,350 1,185,968 Unamortized investment tax credits 131,857 137,965 Accrued pension~~ and ~~other postretirement benefit costs 423,553 404,764 Energy risk management non-current liabilities~~ (~~Note 1 (c~~b)) 135,482 97,507 Other 226,691 252,255 ------- ------- Total Non-Current Liabilities 5,304,107 4,954,826 ---------------------------------------------------------------------------------------------------- Total Liabilities 9,721,842 9,477,933 ---------------------------------------------------------------------------------------------------- Cumulative Preferred Stock of ~~Subsidiaries Not~~Form ~~subject to mandatory redemption 62,833 62,834~~ 10-~~--------------------------------------------------------------------------------------------------- Common~~Q ~~Stock~~and ~~Equity Common~~are ~~stock~~therefore -filing ~~$.01~~their ~~par value; authorized~~company ~~shares~~specific -information ~~600,000,000;outstanding~~with ~~shares~~the ~~- 158,088,053~~reduced atdisclosure ~~June~~format ~~30,~~specified ~~2001 and 158,967,661 December 31, 2000 1,591 1,590 Paid-~~in ~~capital 1,623,458 1,619,153~~General ~~Retained~~Instruction ~~earnings 1,240,761 1,179,113 Accumulated other comprehensive income~~ H(~~loss) (16,927) (10,895) ------- ------- Total Common Stock Equity~~ 2~~,848,883 2,788,961 ---------------------------------------------------------------------------------------------------- Commitments and Contingencies (Note 4~~) ~~Total~~ ~~Liabilities~~of ~~and~~Form ~~Shareholders' Equity $ 12,633,558 $ 12,329,728 ============ ============~~ 10-~~--------------------------------------------------------------------------------------------------- The accompanying notes as they relate to Cinergy Corp~~Q. ~~are an integral part of these consolidated financial statements.~~

~~CINERGY~~As CORP. CONSOLIDATED STATEMENTS OF CHANGES IN COMMON STOCK EQUITY Accumulated Total Other Common Common Paid-in Retained Comprehensive Stock Stock Capital Earnings Income/(Loss) Equity ------------------------------------------------------------------------------------------------------------------------------------ (dollars in thousands) (unaudited) Quarter Ended June 30, 2001 Balance at April 1, 2001 $ 1,590 $ 1,619,366 $ 1,229,552 $ (15,356) $ 2,835,152 Comprehensive income: Net income 82,967 82,967 Other comprehensive income (loss), net of ~~tax~~July ~~effect Foreign currency translation adjustment (3~~31,~~401) (3,401) Unrealized~~ gain (loss) on investment trusts 540 540 Minimum pension liability adjustment (23) (23) Cash flow hedges (Note 1(b)) 12006,~~313 1,313~~ ~~----- Total comprehensive income 81,396 Issuance of 86,522~~ shares of common stock -outstanding ~~net 1 2,865 2,866 Treasury~~for ~~shares~~each ~~purchased (7,824) (7,824) Treasury~~registrant ~~shares~~were reissued 5,622 5,622 Dividends on common stock ($.45 per share) (71,555) (71,555) Other 3,429 (203) 3,226 ----- ----- ---- ----- ----- Ending balance at June 30, 2001 $ 1,591 $ 1,623,458 $ 1,240,761 $ (16,927) $ 2,848,883 =========== =========== =========== =========== =========== ------------------------------------------------------------------------------------------------------------------------------------ Quarter Ended June 30, 2000 Balance at April 1, 2000 $ 1,589 $ 1,604,096 $ 1,131,695 $ (10,512) $ 2,726,868 Comprehensive income: Net income 75,115 75,115 Other comprehensive income (loss), net of tax effect Foreign currency translation adjustment 6,014 6,014 Unrealized gain (loss) on investment trusts (818) (818) ---- Total comprehensive income 80,311 Treasury shares purchased (1,490) (1,490) Treasury shares reissued 5,795 5,795 Dividends on common stock ($.45 per share) (71,114) (71,114) Other 4,171 7 4,178 ----- ----- ----- ----- ----- Ending Balance at June 30, 2000 $ 1,589 $ 1,612,572 $ 1,135,703 $ (5,316) $ 2,744,548 =========== =========== =========== =========== =========== ------------------------------------------------------------------------------------------------------------------------------------ The accompanying notes as ~~they relate to Cinergy Corp. are an integral part of these consolidated financial statements.~~ follows:

                                            CINERGY CORP.
                          CONSOLIDATED STATEMENTS OF CHANGES IN COMMON STOCK EQUITY
                                             (Continued)

                                                                                                         Accumulated        Total
                                                                                                            Other           Common
                                                                   Common      Paid-in     Retained     Comprehensive       Stock
                                                                   Stock       Capital     Earnings     Income/(Loss)       Equity
------------------------------------------------------------------------------------------------------------------------------------
                                                                                       (dollars in thousands)
                                                                                             (unaudited)

Six Months Ended June 30, 2001

Balance at January 1, 2001                                    $     1,590    $ 1,619,153    $ 1,179,113   $   (10,895)  $ 2,788,961
Comprehensive income:
   Net income                                                                                   203,214                     203,214
   Other comprehensive income (loss), net of tax effect
     Foreign currency translation adjustment                                                                   (2,705)       (2,705)
     Unrealized gain (loss) on investment trusts                                                                 (143)         (143)
     Cumulative effect of change in accounting
       principle (Note 1(b))                                                                                   (2,500)       (2,500)
     Minimum pension liability adjustment                                                                          68            68
     Cash flow hedges (Note 1(b))                                                                                (752)         (752)
                                                                                                                               ----
   Total comprehensive income                                                                                               197,182

Issuance of 120,392 shares of common stock - net                        1          3,691                                      3,692
Treasury shares purchased                                                        (10,015)                                   (10,015)
Treasury shares reissued                                                           6,000                                      6,000
Dividends on common stock ($.90 per share)                                                     (143,096)                   (143,096)
Other                                                                              4,629          1,530                       6,159
                                                                    -----          -----          -----         -----         -----
Ending balance at June 30, 2001                               $     1,591    $ 1,623,458    $ 1,240,761   $   (16,927)  $ 2,848,883
                                                              ===========    ===========    ===========   ===========   ===========

------------------------------------------------------------------------------------------------------------------------------------
Six Months Ended June 30, 2000

Balance at January 1, 2000                                    $     1,589    $ 1,597,554    $ 1,064,319   $    (9,741)  $ 2,653,721
Comprehensive income:
   Net income                                                                                   213,554                     213,554
   Other comprehensive income (loss), net of tax effect
     Foreign currency translation adjustment                                                                    4,286         4,286
     Unrealized gain (loss) on investment trusts                                                                  139           139
                                                                                                                                ---
   Total comprehensive income                                                                                               217,979

Treasury shares purchased                                                         (1,490)                                    (1,490)
Treasury shares reissued                                                          10,365                                     10,365
Dividends on common stock ($.90 per share)                                                     (142,191)                   (142,191)
Other                                                                              6,143             21                       6,164
                                                                    -----          -----          -----         -----         -----
Ending Balance at June 30, 2000                               $     1,589    $ 1,612,572    $ 1,135,703   $    (5,316)  $ 2,744,548
                                                              ===========    ===========    ===========   ===========   ===========

------------------------------------------------------------------------------------------------------------------------------------
The accompanying notes as they relate to Cinergy Corp. are an integral part of these consolidated financial statements.

Registrant	Description	Shares

Cinergy Corp.	Par value $.01 per share	100

The Cincinnati Gas & Electric Company	Par value $8.50 per share	89,663,086

PSI Energy, Inc.	Without par value, stated value $.01 per share	53,913,701

~~CINERGY~~TABLE ~~CORP. CONSOLIDATED STATEMENTS~~ OF CASH FLOWS Year to Date June 30 2001 2000 ------------------------------------------------------------------------------------------ (dollars in thousands) (unaudited) Operating Activities Net income $ 203,214 $ 213,554 Items providing or (using) cash currently: Depreciation and amortization 180,767 168,438 Unrealized (gain) loss from energy risk management activities (50,245) (49,032) Deferred income taxes and investment tax credits - net 13,886 9,625 Equity in earnings of unconsolidated subsidiaries (833) (6,175) Allowance for equity funds used during construction (3,219) (3,100) Regulatory assets - net (7,672) 18,511 Changes in other current assets and current liabilities: Restricted deposits (882) (15,333) Accounts and notes receivable, net of reserves on receivables sold (234,953) (197,566) Materials, supplies, and fuel (47,346) 27,229 Accounts payable 299,060 137,975 Accrued taxes and interest (19,903) 7,530 Other items - net (90,212) (49,403) ------- ------- Net cash provided by operating activities 241,662 262,253 ------------------------------------------------------------------------------------------ Financing Activities Change in short-term debt 524,479 196,584 Issuance of long-term debt 372,476 123,189 Redemption of long-term debt (37,090) (55,720) Retirement of preferred stock of subsidiaries -- (10,951) Issuance of common stock 3,692 -- Dividends on common stock (143,096) (142,191) -------- -------- Net cash provided by financing activities 720,461 110,911 ------------------------------------------------------------------------------------------ Investing Activities Construction expenditures (less allowance for equity funds used during construction) (376,917) (215,519) Acquisitions and other investments (545,056) (137,290) -------- -------- Net cash used in investing activities (921,973) (352,809) ------------------------------------------------------------------------------------------ Net increase in cash and cash equivalents 40,150 20,355 Cash and cash equivalents at beginning of period 93,054 81,919 ------ ------ Cash and cash equivalents at end of period $ 133,204 $ 102,274 ========= ========= ------------------------------------------------------------------------------------------ The accompanying notes as they relate to Cinergy Corp. are an integral part of these consolidated financial statements CONTENTS

                                THE CINCINNATI GAS & ELECTRIC COMPANY
                      CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME

                                                               Quarter Ended              Year to Date
                                                                  June 30                   June 30
                                                            2001          2000         2001          2000
--------------------------------------------------------------------------------------------------------------
                                                                          (dollars in thousand)
                                                                               (unaudited)

Operating Revenues
   Electric                                            $ 1,198,015   $   646,973   $ 2,130,760    $ 1,184,991
   Gas                                                      79,407        59,598       404,500        238,060
                                                            ------        ------       -------        -------
         Total Operating Revenues                        1,277,422       706,571     2,535,260      1,423,051
--------------------------------------------------------------------------------------------------------------

Operating Expenses
   Fuel and purchased and exchanged power                  915,835       339,176     1,576,515        579,528
   Gas purchased                                            51,555        24,246       289,846        113,862
   Operation and maintenance                               120,770       130,274       232,395        242,557
   Depreciation and amortization                            46,656        45,569        92,263         89,326
   Taxes other than income taxes                            44,597        53,891        91,968        103,822
                                                            ------        ------        ------        -------
         Total Operating Expenses                        1,179,413       593,156     2,282,987      1,129,095
--------------------------------------------------------------------------------------------------------------

Operating Income                                            98,009       113,415       252,273        293,956
--------------------------------------------------------------------------------------------------------------

Miscellaneous - Net                                            672           962        (1,732)        (1,011)
Interest                                                    26,487        23,724        53,883         49,473
--------------------------------------------------------------------------------------------------------------

Income Before Taxes                                         72,194        90,653       196,658        243,472
--------------------------------------------------------------------------------------------------------------

Income Taxes                                                22,793        34,772        65,682         91,627
                                                            ------        ------        ------         ------

Net Income                                             $    49,401   $    55,881   $   130,976    $   151,845

Preferred Dividend Requirement                                 212           212           423            425
                                                               ---           ---           ---            ---

Net Income Applicable to Common Stock                  $    49,189   $    55,669   $   130,553    $   151,420
                                                       ===========   ===========   ===========    ===========
--------------------------------------------------------------------------------------------------------------

Net Income                                             $    49,401   $    55,881   $   130,976    $   151,845

Other Comprehensive Income (Loss), Net of Tax Effect         1,255            --        (2,660)            --
                                                             -----         -----        ------          -----

Comprehensive Income                                   $    50,656   $    55,881   $   128,316    $   151,845
                                                       ===========   ===========   ===========    ===========
--------------------------------------------------------------------------------------------------------------

The accompanying notes as they relate to The Cincinnati Gas & Electric Company are an integral part of these consolidated financial
statements.

Item Number
		PART I. FINANCIAL INFORMATION

		Cautionary Statement Regarding Forward-Looking Information

1		Financial Statements
		Cinergy Corp. and Subsidiary Companies
		Consolidated Statements of Operations for the Three Months Ended March 31, 2006; June 30, 2006 and 2005; and the Six Months Ended June 30, 2005, as revised
		Consolidated Balance Sheets as of June 30, 2006 and December 31, 2005, as revised
		Consolidated Statements of Changes in Common Stockholder’s Equity and Comprehensive Income (Loss) for the Three Months Ended March 31, 2006 and June 30, 2006 and the Six Months Ended June 30, 2005, as revised
		Consolidated Statements of Cash Flows for the Three Months Ended March 31, 2006 and June 30, 2006 and the Six Months Ended June 30, 2005, as revised

		The Cincinnati Gas & Electric Company and Subsidiary Companies
		Consolidated Statements of Operations for the Three Months Ended March 31, 2006; June 30, 2006 and 2005; and the Six Months Ended June 30, 2005, as revised
		Consolidated Balance Sheets as of June 30, 2006 and December 31, 2005, as revised
		Consolidated Statements of Changes in Common Stockholder’s Equity and Comprehensive Income (Loss) for the Three Months Ended March 31, 2006 and June 30, 2006 and the Six Months Ended June 30, 2005, as revised
		Consolidated Statements of Cash Flows for the Three Months Ended March 31, 2006 and June 30, 2006 and the Six Months Ended June 30, 2005, as revised

		PSI Energy, Inc. and Subsidiary Company
		Consolidated Statements of Operations for the Three and Six Months Ended June 30, 2006 and 2005, as revised
		Consolidated Balance Sheets as of June 30, 2006 and December 31, 2005, as revised
		Consolidated Statements of Cash Flows for the Six Months Ended June 30, 2006 and 2005, as revised

		Notes to Consolidated Financial Statements

2		Management’s Discussion and Analysis of Financial Condition and Results of Operations
		Cinergy Merger with Duke Energy
		2006 Quarterly Results of Operations - Cinergy
		2006 Quarterly Results of Operations - CG&E
		2006 Year to Date Results of Operations - PSI

4		Controls and Procedures

		PART II. OTHER INFORMATION

1		Legal Proceedings

1A		Risk Factors

6		Exhibits

		Signatures

THE CINCINNATI GAS & ELECTRIC COMPANY CONSOLIDATED BALANCE SHEETS ASSETS June 30 December 31 2001 2000 (unaudited) -------------------------------------------------------------------------------- (dollars in thousands) Current Assets Cash and cash equivalents $ 12,986 $ 20,637 Restricted deposits 1,085 160 Notes receivable from affiliated companies -- 91,732 Accounts receivable less accumulated provision for doubtful accounts of $24,058 at June 30, 2001, and $19,044 at December 31, 2000 664,552 494,501 Accounts receivable from affiliated companies 24,193 26,743 Materials, supplies, and fuel - at average cost 109,120 99,061 Energy risk management current assets (Note 1(c)) 225,751 697,488 Prepayments and other 43,633 39,320 ------ ------ Total Current Assets 1,081,320 1,469,642 -------------------------------------------------------------------------------- Property, Plant, and Equipment - at Cost Utility plant in service Electric 1,947,640 1,905,795 Gas 888,299 865,303 Common 251,619 211,424 ------- ------- Total Utility Plant In Service 3,087,558 2,982,522 Construction work in progress 91,431 132,577 ------ ------- Total Utility Plant 3,178,989 3,115,099 Non-regulated property, plant, and equipment 3,234,794 3,181,076 Accumulated depreciation 2,499,659 2,444,867 --------- --------- Net Property, Plant, and Equipment 3,914,124 3,851,308 -------------------------------------------------------------------------------- Other Assets Regulatory assets 521,058 502,328 Energy risk management non-current assets (Note 1(c)) 37,841 7,000 Other 130,123 156,692 ------- ------- Total Other Assets 689,022 666,020 -------------------------------------------------------------------------------- Total Assets $ 5,684,466 $ 5,986,970 =========== =========== -------------------------------------------------------------------------------- The accompanying notes as they relate to The Cincinnati Gas & Electric Company are an integral part of these consolidated financial statements.

THECAUTIONARY CINCINNATI GAS & ELECTRIC COMPANY CONSOLIDATED BALANCE SHEETS LIABILITIES AND SHAREHOLDER'S EQUITY June 30 December 31 2001 2000 (unaudited) -------------------------------------------------------------------------------- (dollars in thousands) Current Liabilities Accounts payable $ 709,053 $ 543,006 Accounts payable to affiliated companies 31,613 23,927 Accrued taxes 125,036 152,750 Accrued interest 21,878 17,645 Notes payable and other short-term obligations 184,000 264,000 Notes payable to affiliated companies 280,448 163,478 Long-term debt due within one year 1,200 1,200 Energy risk management current liabilities (Note 1(c)) 235,792 717,902 Other 32,292 37,603 ------ ------ Total Current Liabilities 1,621,312 1,921,511 -------------------------------------------------------------------------------- Non-Current Liabilities Long-term debt 1,205,234 1,205,061 Deferred income taxes 738,470 735,799 Unamortized investment tax credits 94,153 98,624 Accrued pension and other postretirement benefit costs 164,696 164,901 Energy risk management non-current liabilities (Note 1(c)) 53,361 26,337 Other 106,117 118,421 ------- ------- Total Non-Current Liabilities 2,362,031 2,349,143 -------------------------------------------------------------------------------- Total Liabilities 3,983,343 4,270,654 -------------------------------------------------------------------------------- Cumulative Preferred Stock Not subject to mandatory redemption 20,486 20,486 -------------------------------------------------------------------------------- Common Stock Equity Common stock - $8.50 par value; authorized shares - 120,000,000; outstanding shares - 89,663,086 at June 30, 2001 and December 31, 2000 762,136 762,136 Paid-in capital 565,777 565,777 Retained earnings 356,378 368,911 Accumulated other comprehensive income (loss) (3,654) (994) ------ ---- Total Common Stock Equity 1,680,637 1,695,830 -------------------------------------------------------------------------------- Commitments and Contingencies (Note 4) Total Liabilities and Shareholder's Equity $5,684,466 $5,986,970 ========== ========== -------------------------------------------------------------------------------- The accompanying notes as they relate to The Cincinnati Gas & Electric Company are an integral part of these consolidated financial statements. STATEMENT

THECAUTIONARY CINCINNATISTATEMENT GASREGARDING & ELECTRIC COMPANY CONSOLIDATED STATEMENTS OF CASH FLOWS Year to Date June 30 2001 2000 FORWARD-------------------------------------------------------------------------------------------- (dollarsLOOKING in thousands) (unaudited) Operating Activities Net income $ 130,976 $ 151,845 Items providing or (using) cash currently: Depreciation and amortization 92,263 89,326 Deferred income taxes and investment tax credits - net 3,170 8,378 Unrealized (gain) loss from energy risk management activities (14,190) (28,280) Allowance for equity funds used during construction (941) (2,646) Regulatory assets - net (28,623) 8,085 Changes in current assets and current liabilities: Restricted deposits (925) 22 Accounts and notes receivable, net of reserves on receivables sold (76,146) (11,302) Materials, supplies, and fuel (10,059) 731 Accounts payable 173,649 55,160 Accrued taxes and interest (23,481) 10,039 Other items - net 4,474 (38,678) ----- ------- Net cash provided by operating activities 250,167 242,680 -------------------------------------------------------------------------------------------- Financing Activities Change in short-term debt 36,970 (22,403) Retirement of preferred stock - (160) Dividends on preferred stock (339) (425) Dividends on common stock (143,086) (107,200) -------- -------- Net cash used in financing activities (106,455) (130,188) -------------------------------------------------------------------------------------------- Investing Activities Construction expenditures (less allowance for equity funds used during (151,363) (107,109) -------- -------- Net cash used in investing activities (151,363) (107,109) -------------------------------------------------------------------------------------------- Net increase (decrease) in cash and cash equivalents (7,651) 5,383 Cash and cash equivalents at beginning of period 20,637 9,554 ------ ----- Cash and cash equivalents at end of period $ 12,986 $ 14,937 ========== ========== -------------------------------------------------------------------------------------------- The accompanying notes as they relate to The Cincinnati Gas & Electric Company are an integral part of these consolidated financial statements. INFORMATION

~~PSI~~This ~~ENERGY,~~document ~~INC.~~includes ~~CONSOLIDATED~~forward-looking ~~STATEMENTS~~statements OFwithin ~~INCOME~~the ~~AND~~meaning ~~COMPREHENSIVE~~of ~~INCOME Quarter~~Section ~~Ended Year~~27A toof ~~Date June~~the ~~30 June 30~~Securities 2001 2000 2001 2000 ---------------------------------------------------------------------------------------------------- (dollarsAct inof ~~thousands) (unaudited) Operating~~1933 Revenues Electric $1,184,393 $ 619,760 $2,099,937 $1,153,512 ---------------------------------------------------------------------------------------------------- Operating Expenses Fuel and ~~purchased~~Section ~~and~~21E ~~exchanged~~of ~~power 967,888 397,807 1,655,979 669,236 Operation~~the ~~and~~Securities ~~maintenance 105,278 124,406 196,140 235,749 Depreciation~~Exchange ~~and~~Act ~~amortization 37,202 34,733 73,995 69,425 Taxes~~of ~~other~~1934. Forward-looking ~~than~~statements ~~income~~are ~~taxes 7,551 13,800 22,535 28,409 ----- ------ ------ ------ Total~~based ~~Operating~~on ~~Expenses 1,117,919 570,746 1,948,649 1,002,819~~management’s ~~---------------------------------------------------------------------------------------------------- Operating~~beliefs Income 66,474 49,014 151,288 150,693 ---------------------------------------------------------------------------------------------------- Miscellaneousand -assumptions. These ~~Net 7,330 1,342 5,560 483 Interest 20,597 19,769 38,537 39,853~~ forward-~~---------------------------------------------------------------------------------------------------~~looking ~~Income~~statements ~~Before~~are ~~Taxes 53,207 30,587 118,311 111,323 ---------------------------------------------------------------------------------------------------- Income~~identified ~~Taxes 18,990 11,671 42,662 42,194 ------ ------ ------ ------ Net~~by ~~Income $ 34,217 $ 18,916 $ 75,649 $ 69,129 Preferred~~terms ~~Dividend~~and ~~Requirement 646 1,063 1,293 2,213 --- ----- ----- ----- Net~~phrases ~~Income~~such ~~Applicable~~as to“anticipate,” ~~Common Stock $ 33~~“believe,~~571 $ 17~~” “intend,~~853 $ 74~~” “estimate,~~356 $ 66~~” “expect,~~916 ---------------------------------------------------------------------------------------------------- Net~~” ~~Income $ 34~~“continue,~~217 $ 18~~” “should,~~916 $ 75~~” “could,~~649 $ 69~~” “may,~~129 Other~~” ~~Comprehensive Income (Loss)~~“plan,” Net of Tax Effect 338 (597) (127) 35 --- ---- ---- -- Comprehensive Income $ 34“project,~~555 $ 18,319 $ 75,522 $ 69,164~~” ~~========== ========== ========== ========== ---------------------------------------------------------------------------------------------------- The~~“predict,” ~~accompanying notes as they relate to PSI Energy~~“will, ~~Inc.~~” ~~are~~and ansimilar ~~integral part of these consolidated financial statements~~expressions.

PSI ENERGY, INC. CONSOLIDATED BALANCE SHEETS ASSETS June 30 December 31 2001 2000 (unaudited) Forward-~~-------------------------------------------------------------------------------~~looking ~~(dollars~~statements ininvolve ~~thousands) Current~~risks ~~Assets Cash~~ and ~~cash~~uncertainties ~~equivalents $ 9,600~~that ~~$ 1,311 Restricted~~may ~~deposits 1,014 341 Notes~~cause ~~receivable -- 3 Notes~~actual ~~receivable~~results ~~from~~to ~~affiliated companies 88,188 12,798~~be ~~Accounts~~materially ~~receivable~~different ~~less~~from ~~accumulated~~the ~~provision for~~results ~~doubtful~~predicted. Factors ~~accounts~~that ofcould ~~$9,392~~cause atactual ~~June~~results ~~30, 2001,~~to ~~and~~differ ~~$9,317~~materially ~~at December 31, 2000 727,344 464,930 Accounts receivable~~ from ~~affiliated~~those ~~companies 3,262 5,385 Materials,~~indicated supplies, and fuel - at average cost 92,314 53,838 Energy risk management current assets (Note 1(c)) 225,751 697,488 Prepayments and other 48,148 49,049 ------ ------ Total Current Assets 1,195,621 1,285,143 -------------------------------------------------------------------------------- Property, Plant, and Equipment - at Cost Utility plant in ~~service 4,800,115 4,699,090 Construction~~any work in progress 269,177 190,773 Total Utility Plant 5,069,292 4,889,863 Accumulated depreciation 2,162,814 2,110,747 forward-~~-------- --------- Net~~looking ~~Property, Plant, and Equipment 2,906,478 2,779,116~~statement ~~-------------------------------------------------------------------------------- Other Assets Regulatory assets 453~~include,~~449 474,286 Energy~~ ~~risk~~but management non-current assets (Note 1(c)) 37,841 7,000 Other investments 56,148 51,343 Other 40,569 32,887 ------ ------ Total Other Assets 588,007 565,516 -------------------------------------------------------------------------------- Total Assets $4,690,106 $4,629,775 ========== ========== -------------------------------------------------------------------------------- The accompanying notes as they relate to PSI Energy, Inc. are annot ~~integral~~limited ~~part of these consolidated financial statements.~~ to:

~~PSI ENERGY, INC.~~· Factors ~~CONSOLIDATED~~affecting BALANCE SHEETS LIABILITIES AND SHAREHOLDER'S EQUITY June 30 December 31 2001 2000 (unaudited) -------------------------------------------------------------------------------- (dollars in thousands) Current Liabilities Accounts payable $ 653operations,~~590 $ 392,206 Accounts~~ ~~payable~~such to affiliated companies 41,578 32,448 Accrued taxes 87,291 80,995 Accrued interest 27,055 23,708 Notes payable and other short-term obligations 180,600 188,391 Notes payable to affiliated companies - 146,381 Long-term debt due within one year 42,424 38,325 Energy risk management current liabilities (Note 1(c)) 235,792 717,902 Other 14,855 12,748 ------ ------ Total Current Liabilities 1,283,185 1,633,104 -------------------------------------------------------------------------------- Non-Current Liabilities Long-term debt (Note 2) 1,374,956 1,074,255 Deferred income taxes 473,445 458,593 Unamortized investment tax credits 37,704 39,341 Accrued pension and other postretirement benefit costs 150,454 143,990 Energy risk management non-current liabilities (Note 1(c)) 53,361 26,337 Other 66,731 78,112 ------ ------ Total Non-Current Liabilities 2,156,651 1,820,628 -------------------------------------------------------------------------------- Total Liabilities 3,439,836 3,453,732 -------------------------------------------------------------------------------- Cumulative Preferred Stock Not subject to mandatory redemption 42,347 42,348 -------------------------------------------------------------------------------- Common Stock Equity Common stock - without par value; $.01 stated value; authorized shares - 60,000,000; outstanding shares - 53,913,701 at June 30, 2001 and December 31, 2000 539 539 Paid-in capital 413,523 413,523 Retained earnings 794,508 720,153 Accumulated other comprehensive income (loss) (647) (520) ---- ---- Total Common Stock Equity 1,207,923 1,133,695 -------------------------------------------------------------------------------- Commitments and Contingencies (Note 4) Total Liabilities and Shareholder's Equity $4,690,106 $4,629,775 ========== ========== -------------------------------------------------------------------------------- The accompanying notes as ~~they relate to PSI Energy, Inc. are an integral part of these consolidated financial statements.~~ :

PSI ENERGY, INC. CONSOLIDATED STATEMENTS OF CASH FLOWS Year to Date June 30 2001 2000 -------------------------------------------------------------------------------------------- (dollars in thousands) (unaudited) Operating Activities Net income $ 75,649 $ 69,129 Items providing or (using) cash currently: Depreciation and amortization 73,995 69,425 Deferred income taxes and investment tax credits - net 11,735 5,517 Unrealized gain from energy risk management activities (14,190) (23,081) Allowance for equity funds used during construction (2,278) (454) Regulatory assets - net 20,951 10,426 Changes in other current assets and current liabilities: Restricted deposits (673) (155) Accounts and notes receivable, net of reserves on receivables sold (331,677) 75,266 Materials, supplies, and fuel (38,476) 26,783 Accounts payable 270,514 49,495 Accrued taxes and interest 9,643 (23,943) Other items - net (15,534) (41,861) ------- ------- Net cash provided by operating activities 59,659 216,547 -------------------------------------------------------------------------------------------- Financing Activities Change in short-term debt (154,172) (58,408) Issuance of long-term debt 322,471 53,075 Redemption of long-term debt (19,825) (55,276) Retirement of preferred stock - (10,791) Dividends on preferred stock (1~~,294~~) ~~(2,295) Dividends~~ unanticipated ~~on common stock - (36,000)~~weather ----- ------- Net cash provided by (used in) financing activities 147,180 (109,695) -------------------------------------------------------------------------------------------- Investing Activities Construction expenditures (less allowance for equity funds used during construction) (193,691) (108,461) Other investments (4,859) (3,157) ------ ------ Net cash used in investing activities (198,550) (111,618) -------------------------------------------------------------------------------------------- Net increase (decrease) in cash and cash equivalents 8,289 (4,766) Cash and cash equivalents at beginning of period 1,311 8,842 ----- ----- Cash and cash equivalents at end of period $ 9,600 $ 4,076 ========= ========= -------------------------------------------------------------------------------------------- The accompanying notes as they relate to PSI Energy, Inc. are an integral part of these consolidated financial statements. conditions;

THE UNION LIGHT, HEAT AND POWER COMPANY STATEMENTS OF INCOME Quarter Ended Year to Date June 30 June 30 2001 2000 2001 2000 -------------------------------------------------------------------------------- (dollars in thousands) (unaudited) Operating Revenues Electric $ 62,260 $ 55,080 $ 116,862 $ 104,368 Gas 13,608 11,060 72,770 44,547 ------ ------ ------ ------ Total Operating Revenues 75,868 66,140 189,632 148,915 -------------------------------------------------------------------------------- Operating Expenses Electricity purchased from parent company for resale 34,523 39,929 71,367 75,140 Gas purchased 8,324 4,988 51,236 22,982 Operation and maintenance 8,954 9,466 18,201 18,694 Depreciation and amortization 4,239 3,922 8,404 7,658 Taxes other than income taxes 1,155 1,025 2,262 2,123 ----- ----- ----- ----- Total Operating Expenses 57,195 59,330 151,470 126,597 -------------------------------------------------------------------------------- Operating Income 18,673 6,810 38,162 22,318 -------------------------------------------------------------------------------- Miscellaneous - Net (144) ~~(439) (613) (630) Interest 1,550 1,573 3,243 3,144 -------------------------------------------------------------------------------- Income~~ unscheduled ~~Before Taxes 16,979 4,798 34,306 18,544~~generation -------------------------------------------------------------------------------- Income Taxes 5,968 2,021 9,440 7,621 ----- ----- ----- ----- Net Income $ 11,011 $ 2,777 $ 24,866 $ 10,923 ========= ========= ========= ========= -------------------------------------------------------------------------------- The accompanying notes as they relate to The Union Light, Heat and Power Company are an integral part of these financial statements. outages;

THE UNION LIGHT, HEAT AND POWER COMPANY BALANCE SHEETS ASSETS June 30 December 31 2001 2000 (~~unaudited~~3) ~~-------------------------------------------------------------------------------- (dollars~~ unusual inmaintenance ~~thousands)~~or Current Assets Cash and cash equivalents $ 4,426 $ 6,460 Accounts receivable less accumulated provision for doubtful accounts of $2,343 at June 30, 2001, and $1,492 at December 31, 2000 9,926 28,518 Accounts receivable from affiliated companies 21 2,279 Materials, supplies, and fuel - at average cost 7,264 6,300 Prepayments and other 600 274 --- --- Total Current Assets 22,237 43,831 -------------------------------------------------------------------------------- Property, Plant, and Equipment - at Cost Utility plant in service Electric 241,556 234,482 Gas 188,718 184,878 Common 49,633 44,603 ------ ------ Total Utility Plant In Service 479,907 463,963 Construction work in progress 11,249 15,069 ------ ------ Total Utility Plant 491,156 479,032 Accumulated depreciation 174,555 169,403 ------- ------- Net Property, Plant, and Equipment 316,601 309,629 -------------------------------------------------------------------------------- Other Assets Regulatory assets 10,384 10,177 Other 5,069 5,110 ----- ----- Total Other Assets 15,453 15,287 -------------------------------------------------------------------------------- Total Assets $354,291 $368,747 ======== ======== -------------------------------------------------------------------------------- The accompanying notes as they relate to The Union Light, Heat and Power Company are an integral part of these financial statements. repairs;

THE UNION LIGHT, HEAT AND POWER COMPANY BALANCE SHEETS LIABILITIES AND SHAREHOLDER'S EQUITY June 30 December 31 2001 2000 (unaudited) -------------------------------------------------------------------------------- (dollars in thousands) Current Liabilities Accounts payable $ 4~~,563 $ 24,249 Accounts payable to affiliated companies 21,562 20,192 Accrued taxes 1,004 (5,760~~) ~~Accrued~~ unanticipated ~~interest 1,265 1,215 Notes~~changes ~~payable to affiliated companies 13,565 29,403~~in Other 4,015 11,669 ----- ------ Total Current Liabilities 45,974 80,968 -------------------------------------------------------------------------------- Non-Current Liabilities Long-term debt 74,605 74,589 Deferred income taxes 38,631 35,822 Unamortized investment tax credits 3,546 3,684 Accrued pension and other postretirement benefit costs 13,085 13,041 Amounts due to customers - income taxes 7,439 7,439 Other 3,787 6,016 ----- ----- Total Non-Current Liabilities 141,093 140,591 -------------------------------------------------------------------------------- Total Liabilities 187,067 221,559 -------------------------------------------------------------------------------- Common Stock Equity Common stock - $15.00 par value; authorized shares - 1,000,000; outstanding shares - 585,333 at June 30, 2001 and December 31, 2000 8,780 8,780 Paid-in capital 20,305 20,305 Retained earnings 138,139 118,103 ------- ------- Total Common Stock Equity 167,224 147,188 -------------------------------------------------------------------------------- Commitments and Contingencies (Note 4) Total Liabilities and Shareholder's Equity $354,291 $368,747 ======== ======== -------------------------------------------------------------------------------- The accompanying notes as they relate to The Union Light, Heat and Power Company are an integral part of these financial statements.

THE UNION LIGHT, HEAT AND POWER COMPANY STATEMENTS OF CASH FLOWS Year to Date June 30 2001 2000 ------------------------------------------------------------------------------------------------------------ (~~dollars in thousands~~5) ~~(unaudited) Operating~~ environmental ~~Activities~~incidents; ~~Net income $ 24,866 $ 10,923 Items providing or (using) cash currently: Depreciation~~ and amortization 8,404 7,658 Deferred income taxes and investment tax credits - net 2,671 (565) Allowance for equity funds used during construction (37) (28) Regulatory assets - net (377) 203 Changes in current assets and current liabilities: Accounts and notes receivable, net of reserves on receivables sold 21,274 7,298 Materials, supplies, and fuel (964) 2,497 Accounts payable (18,316) (1,762) Accrued taxes and interest 6,814 4,294 Other items - net (10,993) 4,474 ------- ----- Net cash provided by operating activities 33,342 34,992 ------------------------------------------------------------------------------------------------------------ Financing Activities Change in short-term debt (15,838) (16,229) Dividends on common stock (4,829) (4,975) ------ ------ Net cash used in financing activities (20,667) (21,204) ------------------------------------------------------------------------------------------------------------ Investing Activities Construction expenditures (less allowance for equity funds used during construction) (14,709) (12,761) ------- ------- Net cash used in investing activities (14,709) (12,761) ------------------------------------------------------------------------------------------------------------ Net increase (decrease) in cash and cash equivalents (2,034) 1,027 Cash and cash equivalents at beginning of period 6,460 3,641 ----- ----- Cash and cash equivalents at end of period $ 4,426 $ 4,668 ======== ======== ------------------------------------------------------------------------------------------------------------ The accompanying notes as they relate to The Union Light, Heat and Power Company are an integral part of these financial statements.

~~NOTES~~(6) electric TOtransmission ~~FINANCIAL~~or gas ~~STATEMENTS~~pipeline system constraints.

~~In this report Cinergy (which includes Cinergy Corp.~~ · Legislative and ~~all~~regulatory ofinitiatives ~~our regulated~~ and ~~non-regulated subsidiaries)~~legal isdevelopments, atincluding ~~times,~~costs ~~referred~~of compliance towith inexisting ~~the~~and ~~first~~future ~~person~~environmental ~~as "we," "our," or "us~~requirements."

1.· Additional competition ~~Summary~~in ofelectric ~~Significant~~or ~~Accounting~~gas ~~Policies~~markets and continued industry consolidation.

~~(a)~~· Financial or ~~Presentation~~regulatory accounting principles.

~~Our Financial Statements~~· Changing ~~reflect~~market ~~all~~conditions ~~adjustments~~and ~~(which~~other ~~include~~factors ~~normal,~~related ~~recurring~~to ~~adjustments)~~physical ~~necessary in~~energy ~~the opinion of the registrants for a fair presentation of the interim results. These statements should be read in conjunction with the Financial Statements~~ and ~~the notes thereto included in the combined 2000 Form 10-K of the~~financial ~~registrants.~~trading ~~Certain amounts in the 2000 Financial Statements have been reclassified to conform to the 2001 presentation~~activities.

~~(b)~~· The performance ~~Financial~~of ~~Derivatives~~projects undertaken by Cinergy’s and CG&E’s non-regulated businesses and the success of efforts to invest in and develop new opportunities.

We· Availability of, ~~use~~or ~~derivative~~cost ~~financial~~of, ~~instruments to manage:~~capital.

~~funding costs;~~· Employee workforce factors.

~~exposure~~· Delays and toother ~~fluctuations~~obstacles inassociated ~~interest~~with ~~rates;~~mergers, acquisitions, and investments in joint ventures.

~~exposure~~· Costs and toeffects ~~foreign~~of ~~currency~~legal ~~exchange~~and ~~rates.~~administrative proceedings, settlements, investigations, and claims.

~~We account for derivatives~~· Business ~~under Statement of Financial Accounting Standards No. 133~~uncertainties, ~~Accounting~~contractual ~~for Derivatives and Hedging Activities (Statement 133)~~restrictions, which requires all derivatives that are not exempted to be accounted for at fair value. Changes in the derivative’s fair value must be recognized currently in earnings unless specific hedge accounting criteria are met. Gains and ~~losses on derivatives that qualify as hedges can (a) offset related fair value changes on~~ the ~~hedged~~potential ~~item in~~inability ~~the~~to ~~income statement for fair value hedges; or (b) be recorded in other~~attract comprehensive income for cash flow hedges. To qualify for hedge accounting, financial instruments must be designated as a hedge (for example, an offset of foreign exchange or interest rate risks) at the inception of the contract and ~~must~~ beretain ~~effective~~key ~~at reducing the risk associated with the hedged item~~personnel. ~~Accordingly, changes in the fair values or cash flows of instruments designated as hedges must be highly correlated with changes in the fair values or cash flows of the related hedged items.~~

~~From time to time~~Cinergy, ~~we may use foreign currency contracts (for example~~CG&E, ~~a contract obligating one party to buy,~~ and ~~the~~PSI ~~other to sell, a specified quantity of a foreign currency for a~~undertake ~~fixed~~no ~~price~~obligation ~~at a future date) and currency swaps (for example, a contract whereby two parties exchange principal and interest cash flows denominated in different currencies)~~ to ~~hedge~~update foreign currency denominated purchase and sale commitments (cash flow hedges) and certain of our net investments in foreign operations (net investment hedges) against currency exchange rate fluctuations. At June 30, 2001, the ~~fair~~information ~~value,~~contained ~~and ineffectiveness, of instruments that we have classified as foreign currency cash flow hedges was not material~~herein. ~~Reclassification of unrealized gains or losses on foreign currency cash flow hedges from other comprehensive income occurs when the underlying hedged item is recorded in income.~~

We also use interest rate swaps (an agreement by two parties to exchange fixed-interest rate cash flows for floating-interest rate cash flows). Through December 31, 2000, we utilized the accrual method to account for these interest rate swaps. Accordingly, gains and losses were calculated based on the current period difference between the fixed-rate and the floating-rate interest amounts, using agreed upon notional amounts. These gains and losses were recognized in our Consolidated Statements of Income as a component of Interest over the life of the agreement. Effective with our adoption of Statement 133 in the first quarter of 2001, we began accounting for interest rate swaps using mark-to-market accounting and are assessing the effectiveness of any swaps used in hedging activities. At June 30, 2001, the fair value, and ineffectiveness, of instruments that we have classified as cash flow hedges of variable rate debt instruments was not material. Reclassification of unrealized gains or losses on cash flow hedges of variable-rate debt instruments from other comprehensive income occurs as interest payments are made on the debt instrument. See Note 1(d) below for further discussion of Statement 133.3

(cCINERGY CORP. AND )SUBSIDIARY ~~Energy Marketing and Trading~~COMPANIES

We market and trade electricity, natural gas, and other energy-related products. We designate transactions as physical or trading at the time they are originated. Physical refers to our intent and projected ability to fulfill substantially all obligations from company-owned assets. We sell generation to third parties when it is not required to meet native load requirements (end-use customers within our public utility companies’ franchise service territory). All other energy contracts (including most natural gas contracts) are classified as trading. We account for physical transactions on a settlement basis and trading transactions using the mark-to-market method of accounting, consistent with our application of EITF 98-10, Accounting for Contracts Involved in Energy Trading and Risk Management Activities. To the extent that physical transactions constitute derivatives under Statement 133, we typically utilize the normal purchases and sales exemption, when the criteria for the application of the normal exemption are met. To the extent trading transactions constitute derivatives under Statement 133, we typically do not attempt to identify them as a hedging instrument. Under the mark-to-market method of accounting, trading transactions are shown at fair value in our Consolidated Balance Sheets as Energy risk management assets – and Energy risk management liabilities – current and non-current. We reflect changes in fair value resulting in unrealized gains and losses in Fuel and purchased and exchanged power and Gas purchased. We record the revenues and costs for all transactions in our Consolidated Statements of Income when the contracts are settled. We recognize revenues in Operating revenues; costs are recorded in Fuel and purchased and exchanged power and Gas purchased. 4

~~Although~~CINERGY ~~we intend to settle physical contracts with company-owned generation, occasionally we settle these contracts with power purchased on the open trading markets~~CORP. The cost of these purchases could be in excess of the associated revenues. We recognize the gains or losses on these transactions as the power is delivered. Due to the infrequency of such settlements, both historical and projected, and the fact that physical power settlement to the customer still occurs, we continue to apply the normal purchases and sales exemption to such physical contracts that constitute derivatives. Open market purchases may occur for the following reasons:

~~generating~~CONSOLIDATED STATEMENTS ~~station~~OF ~~outages;~~ OPERATIONS

~~least-cost~~(dollars ~~alternative;~~ in thousands)

~~native load requirements; and~~ (unaudited)

extreme weather.

	Successor			Predecessor
	Three Months			Three Months			Three Months			Six Months
	Ended			Ended			Ended			Ended
	June 30, 2006			March 31, 2006			June 30, 2005			June 30, 2005

Operating Revenues
Non-regulated electric, natural gas, natural gas liquids, and other	$	464,481		$	551,658		$	366,883		$	747,282
Regulated electric	750,149			702,701			591,625			1,160,544
Regulated natural gas and natural gas liquids	93,238			321,316			92,640			392,747
Total operating revenues	1,307,868			1,575,675			1,051,148			2,300,573

Operating Expenses
Natural gas and petroleum products purchased	50,993			232,006			56,089			264,689
Operation, maintenance, and other	360,071			400,358			305,100			585,782
Fuel used in electric generation and purchased power	531,296			416,531			298,716			590,224
Costs of fuel resold	39,986			146,298			93,087			178,849
Depreciation and amortization	183,777			162,039			148,756			298,801
Property and other taxes	70,739			86,083			64,056			141,897
Total operating expenses	1,236,862			1,443,315			965,804			2,060,242

(Losses) Gains on Sales of Other Assets and Other, net	(5,227		)	26,069			39,535			70,345

Operating Income	65,779			158,429			124,879			310,676

Other Income and Expenses
Equity in earnings of unconsolidated affiliates	5,606			4,095			13,576			18,411
Other income and expenses, net	22,968			16,667			14,690			17,569
Total other income and expenses	28,574			20,762			28,266			35,980

Interest Expense	81,520			83,933			67,893			131,660
Preferred dividend requirement of subsidiaries	38			277			858			1,716

Income from Continuing Operations Before Income Taxes	12,795			94,981			84,394			213,280

Income Tax Expense from Continuing Operations	5,979			16,883			21,212			45,776

Income from Continuing Operations	6,816			78,098			63,182			167,504

(Loss) Income from Discontinued Operations, net of tax	(6,071		)	4,759			(12,474		)	560

Cumulative Effect of a Change in Accounting Principle, net of tax	—			(3,493		)	—			—

Net Income	$	745		$	79,364		$	50,708		$	168,064

WeSee ~~value~~Notes ~~contracts~~to ~~in the trading portfolio using end-of-the-period market prices, utilizing the~~Unaudited ~~following~~Consolidated ~~factors~~Financial ~~(as applicable):~~Statements

~~closing exchange prices (that is, closing prices for standardized electricity and natural gas products traded on an organized exchange such as the New York Mercantile Exchange);~~ 5

~~broker-dealer and over-the-counter price quotations; and~~CINERGY CORP.

CONSOLIDATED ~~model~~BALANCE ~~pricing (which considers time value and historical volatility factors of electricity and natural gas pricing underlying any options and contractual commitments).~~ SHEETS

~~We anticipate that some of~~(dollars ~~the~~in electricity obligations, even though considered trading contracts, will ultimately be settled using company-owned generation. The cost of this generation is usually below the market price at which the trading portfolio has been valued. We expect earnings volatility from period to period due to the risks associated with marketing and trading electricity, natural gas, and other energy-related products. thousands)

During the first six months of 2001, our natural gas trading volumes increased substantially. Because of this volume change and the potential volatility of gas prices, our risk exposure to these markets has increased. However, we continue to employ value-at-risk analysis and other methodologies to mitigate our risks in all trading operations, including natural gas trading.(unaudited)

~~(d) Accounting Changes~~ASSETS

On July 20, 2001, the Financial Accounting Standards Board (FASB) issued Statement of Financial Accounting Standards No. 141, Business Combinations (Statement 141), and No. 142, Goodwill and Other Intangible Assets (Statement 142). Statement 141 requires all business combinations initiated after June 30, 2001, to be accounted for using the purchase method. With the adoption of Statement 142, goodwill and other intangibles with indefinite lives will no longer be subject to amortization. Goodwill will be initially assessed for impairment shortly after adoption and at least annually thereafter by applying a fair-value-based test, as opposed to the undiscounted cash flow test applied under current accounting standards. This test must be applied at the “reporting unit” level, which will be defined within Cinergy after further review and will be a level no broader than the current business segments discussed in Note 5. Under Statement 142, an acquired intangible asset should be separately recognized if the benefit of the intangible asset is obtained through contractual or other legal rights, or if the intangible asset can be sold, transferred, licensed, rented, or exchanged, regardless of the acquirer’s intent to do so. We will begin applying Statement 141 in the third quarter of 2001 and adopt Statement 142 in the first quarter of 2002. Until we adopt Statement 142, goodwill will continue to be amortized. We do not believe that the discontinuance of amortization of goodwill will be material to our 2002 results of operations. We are analyzing the impact of the initial impairment test, and are unable to predict, at this time, whether the implementation of these accounting standards will be material to our financial position or results of operations.

	Successor		Predecessor
	June 30,		December 31,
	2006		2005

Current Assets
Cash and cash equivalents	$	121,010	$	146,056
Receivables (net of allowance for doubtful accounts of $7,747 at June 30, 2006 and $4,767 at December 31, 2005)	611,955		1,659,411
Inventory	308,673		473,440
Assets held for sale	1,252,563		15,803
Unrealized gains on mark-to-market and hedging transactions	81,022		1,002,131
Other	130,270		398,096
Total current assets	2,505,493		3,694,937

Investments and Other Assets
Restricted funds held in trust	261,088		301,800
Investments in unconsolidated affiliates	499,248		479,466
Goodwill	4,127,697		33,352
Intangible assets	977,058		310,294
Notes receivable	158,933		171,325
Unrealized gains on mark-to-market and hedging transactions	110,266		306,959
Assets held for sale	426,111		18,412
Other	234,790		208,214
Total investments and other assets	6,795,191		1,829,822

Property, Plant, and Equipment
Cost	16,920,605		15,990,864
Less accumulated depreciation and amortization	4,363,848		5,477,782
Net property, plant, and equipment	12,556,757		10,513,082

Regulatory Assets and Deferred Debits
Deferred debt expense	76,071		91,538
Regulatory assets related to income taxes	84,551		98,146
Other	1,265,701		926,315
Total regulatory assets and deferred debits	1,426,323		1,115,999

Total Assets	$	23,283,764	$	17,153,840

~~During 1998, FASB issued~~See ~~Statement~~Notes ~~133. This standard was effective for calendar year-end companies beginning in 2001, and requires companies~~ to ~~record~~Unaudited ~~derivative~~Consolidated ~~instruments~~Financial which are not exempt under certain provisions of Statement 133 as assets or liabilities, measured at fair value (i.e., marked-to-market). Our financial statements reflect the adoption of Statement 133 in January 2001. Since many of our derivatives were previously required to use mark-to-market accounting, the effects of implementation were immaterial. Statements

Our adoption did not reflect the potential impact of applying mark-to-market accounting to selected call options and forwards. We had not historically marked these instruments to market because they are intended as either hedges of peak period exposure or sales contracts served with physical generation, neither of which were considered trading activities. At adoption, we classified these contracts as normal purchases or sales based on our interpretation of Statement 133 and in the absence of definitive guidance on such contracts. In June 2001, the FASB-sponsored Derivatives Implementation Group issued final guidance on the application of the normal purchases and sales exemption to electricity contracts structured as options or forwards. While much of the criteria that this guidance requires is consistent with the existing guidance in Statement 133, some criteria were added. We will adopt the new guidance in the third quarter of 2001, and preliminary estimates indicate that the effects of implementation for these contracts will not be material. We will continue to apply this guidance to any new electricity contracts that meet the definition of a derivative. 6

2.CINERGY ~~Long-Term Debt~~CORP.

InCONSOLIDATED ~~January~~BALANCE 2001, PSI Energy, Inc. (PSI) retired $19.8 million principal amount of non-interest bearing Series 1994 Promissory Note, which had matured. The securities were not replaced by new issues of debt. In March 2001, Cinergy Global Resources, Inc., a subsidiary of Cinergy, borrowed $26 million at a fixed interest rate of 6.10%, maturing on March 31, 2003. SHEETS

On(dollars ~~June~~in 22thousands, ~~2001, PSI~~except ~~issued $325 million principal amount of First Mortgage Bonds Series~~per ~~EEE,~~share ~~6.65% with a maturity date of June 15, 2006. The net proceeds of the offering were used to repay short-term indebtedness.~~ amounts)

~~3. Short-Term Debt~~(unaudited)

OnLIABILITIES ~~March~~AND ~~21,~~COMMON ~~2001,~~STOCKHOLDER’S Cinergy Corp. placed a $500 million, 364-day senior revolving credit facility. Also, on May 4, 2001, Cinergy Corp. placed a $400 million, three-year senior revolving credit facility which replaced Cinergy Corp.'s $400 million, five-year revolving credit facility that expired on May 6, 2001, and a $200 million, three-year revolving credit facility that expired on July 20, 2001. These facilities are used to provide short-term interim financing.EQUITY

4. Commitments and Contingencies

	Successor			Predecessor
	June 30,			December 31,
	2006			2005

Current Liabilities
Accounts payable	$	657,624		$	1,647,106
Notes payable and commercial paper	1,271,590			923,600
Taxes accrued	62,934			219,469
Interest accrued	75,608			64,725
Liabilities associated with assets held for sale	825,019			5,721
Current maturities of long-term debt and preferred stock	385,369			360,730
Unrealized losses on mark-to-market and hedging transactions	91,827			1,010,585
Other	248,307			417,643
Total current liabilities	3,618,278			4,649,579

Long-term Debt	4,592,755			4,459,694

Deferred Credits and Other Liabilities
Deferred income taxes	1,813,882			1,523,070
Investment tax credit	86,502			90,852
Accrued pension and other postretirement benefit costs	1,279,117			729,221
Regulatory liabilities	624,924			546,047
Unrealized losses on mark-to-market and hedging transactions	91,613			341,671
Liabilities associated with assets held for sale	278,009			23,155
Asset retirement obligations	59,611			57,425
Other	336,171			123,988
Total deferred credits and other liabilities	4,569,829			3,435,429

Commitments and Contingencies
Cumulative Preferred Stock of Subsidiaries Not Subject to Mandatory Redemption	—			31,743

Common Stockholder’s Equity
Common stock, $.01 par value; 1,000 shares authorized, 100 shares issued and outstanding at June 30, 2006; 600,000,000 shares authorized, 199,707,338 shares issued, and 199,565,684 shares outstanding at December 31, 2005	—			1,997
Paid-in capital	10,542,958			2,982,625
Retained earnings	745			1,721,716
Treasury shares at cost – 0 shares at June 30, 2006 and 141,654 shares at December 31, 2005	—			(4,823		)
Accumulated other comprehensive loss	(40,801		)	(124,120		)
Total common stockholder’s equity	10,502,902			4,577,395

Total Liabilities and Common Stockholder’s Equity	$	23,283,764		$	17,153,840

~~(a)~~See ~~Ozone~~Notes ~~Transport~~to ~~Rulemaking~~Unaudited Consolidated Financial Statements

In June 1997, the Ozone Transport Assessment Group, which consisted of 37 states, made a wide range of recommendations to the United States (U.S.) Environmental Protection Agency (EPA) to address the impact of ozone transport on serious non-attainment areas (geographic areas defined by the EPA as non-compliant with ozone standards) in the Northeast, Midwest, and South. Ozone transport refers to wind-blown movement of ozone and ozone-causing materials across city and state boundaries. In late 1997, the EPA published a proposed call for revisions to State Implementation Plans (SIPs) for achieving emissions reductions to address air quality concerns. The EPA must approve all SIPs.7

~~(i) Nitrogen~~CINERGY ~~Oxide (NOX) SIP Call~~CORP.

~~In October 1998, the EPA~~CONSOLIDATED ~~finalized~~STATEMENTS ~~its~~OF ~~ozone~~CHANGES ~~transport~~IN ~~rule,~~COMMON ~~also known as the NOX SIP Call. It applied to 22 states in the eastern half of the U.~~STOCKHOLDER’S., ~~including~~EQUITY ~~the~~AND ~~three states~~COMPREHENSIVE inINCOME which our electric utilities operate, and also proposed a model NOX emission allowance-trading program. This rule recommended states reduce NOX emissions primarily from industrial and utility sources to a certain level by May 2003. The EPA gave the affected states until September 30, 1999, to incorporate NOX reductions and, at the discretion of the state, a NOX trading program into their SIPs. The EPA proposed to implement a federal plan to accomplish the equivalent NOX reductions by May 1, 2003, if states failed to revise their SIPs. (LOSS)

~~Ohio, Indiana, a number of other states, and various industry groups~~ (~~some~~dollars ~~of which we are a member), filed legal challenges to the NOX SIP Call~~ in ~~late 1998. On May 25~~thousands, ~~1999, the~~except ~~U.S. Circuit Court of Appeals for the District of Columbia (Court of~~per ~~Appeals)~~share ~~granted a request for a deferral of the rule and indefinitely suspended the September 30 filing deadline, pending further review by the Court of Appeals.~~ amounts)

In March 2000, the Court of Appeals substantially upheld the EPA’s rule. On April 11, 2000, the EPA asked the Court of Appeals to remove its May 25, 1999 suspension of the rule and also directed states to submit SIP revisions by September 1, 2000. On April 17, 2000, various states and industry groups (~~some of which we are a member~~unaudited) filed a request with the Court of Appeals for a rehearing of the NOX SIP Call decisions. On April 24, 2000, the same group filed a request with the Court of Appeals to require a rulemaking and a comment period to determine a new compliance date. The states also filed a request to obtain more time to file their SIPs. On June 23, 2000, the Court of Appeals denied both requests and directed the states to submit their SIP revisions by October 30, 2000. The states of Indiana, Kentucky, and Ohio subsequently submitted letters stating their intent to revise their SIPs in response to the NOX SIP Call. On December 26, 2000, the EPA took final action against Indiana, Kentucky, Ohio, and most other SIP Call affected states for failing to make complete SIP revisions. This action triggers an 18-month time clock for mandatory sanctions under a Federal Implementation Plan.

In August 2000, the Court of Appeals extended the May 1, 2003 deadline for NOX reductions to May 31, 2004. The states and other groups sought review of the Court of Appeals ruling by the U.S. Supreme Court (Supreme Court). In March 2001, the Supreme Court decided not to grant that review.

											Accumulated			Total
											Other			Common
	Common		Paid-in		Retained			Treasury			Comprehensive			Stockholder’s
	Stock		Capital		Earnings			Stock			Income (Loss)			Equity

Successor

Three Months Ended June 30, 2006

Balance at April 1, 2006	$	—	$	9,088,764	$	—		$	—		$	—		$	9,088,764

Net income					745									745
Other comprehensive loss, net of tax effect of $838
Foreign currency translation adjustment											315			315
Unrealized loss on investment trusts											(1,326		)	(1,326		)
Cash flow hedges											(134		)	(134		)
Total comprehensive loss														(400		)

Transfer of generating assets from Duke Energy(1)			1,452,191								(39,656		)	1,412,535
Other			2,003											2,003

Balance at June 30, 2006	$	—	$	10,542,958	$	745		$	—		$	(40,801	)	$	10,502,902


Predecessor

Three Months Ended March 31, 2006

Balance at January 1, 2006 (199,565,684 shares)	$	1,997	$	2,982,625	$	1,721,716		$	(4,823	)	$	(124,120	)	$	4,577,395

Net income					79,364									79,364
Other comprehensive income, net of tax effect of $(5,413)
Foreign currency translation adjustment											120			120
Unrealized gain on investment trusts											1,530			1,530
Minimum pension liability adjustment											916			916
Cash flow hedges											7,539			7,539
Total comprehensive income														89,469

Issuance of common stock, net (946,650 shares)	10		28,862											28,872
Treasury shares purchased (4,959 shares)								(224		)				(224		)
Dividends on common stock ($.64 per share)					(127,314		)							(127,314		)
Other			6,092		(27		)							6,065

Balance at March 31, 2006 (200,507,375 shares)	$	2,007	$	3,017,579	$	1,673,739		$	(5,047	)	$	(114,015	)	$	4,574,263

Six Months Ended June 30, 2005

Balance at January 1, 2005 (187,524,229 shares)	$	1,877	$	2,559,715	$	1,613,340		$	(4,336	)	$	(54,674	)	$	4,115,922

Net income			168,064											168,064
Other comprehensive income (loss), net of tax effect of $6,635
Foreign currency translation adjustment											(13,107		)	(13,107		)
Unrealized loss on investment trusts											(954		)	(954		)
Cash flow hedges											1,101			1,101
Total comprehensive income														155,104

Issuance of common stock, net (11,015,306 shares)	110		377,513											377,623
Treasury shares purchased (10,852 shares)								(430		)				(430		)
Dividends on common stock ($.96 per share)					(187,076		)							(187,076		)
Other			4,519		(275		)							4,244

Balance at June 30, 2005 (198,528,683 shares)	$	1,987	$	2,941,747	$	1,594,053		$	(4,766	)	$	(67,634	)	$	4,465,387

In(1) Includes ~~June 2001~~$39,656 ~~the~~(net ~~Court~~ of ~~Appeals~~ ~~remanded~~tax ~~portions~~benefit of ~~the~~$23,793) ~~NOX~~related ~~SIP Call~~ to ~~the EPA for~~deferred ~~reconsideration~~losses ofon ~~how~~terminated ~~growth~~cash ~~was~~flow ~~factored~~hedges ~~into~~included ~~the~~in ~~state~~Accumulated ~~NOX~~Other ~~budgets.~~Comprehensive ItIncome is(Loss). See ~~unclear~~Note ~~whether~~12(b)(v) ~~this~~to ~~decision will result in an increase or decrease in~~ the ~~size~~Consolidated ofFinancial ~~the NOX reduction requirement~~Statements.

~~The~~See ~~states~~Notes ~~of Indiana and Kentucky approved the final NOX SIP Call rule, through a cap and trade program, in June and July of 2001, respectively. The EPA is expected~~ to ~~approve~~ ~~the~~Unaudited ~~state~~Consolidated ~~rules~~Financial ~~by the end of 2001. The State of Ohio is still in the process of developing its version of the NOX SIP Call rule.~~ Statements

On September 25, 2000, Cinergy announced a plan for its subsidiaries, The Cincinnati Gas & Electric Company (CG&E) and PSI, to invest in pollution control equipment and other methods to reduce NOX emissions. The current estimate of costs for this expected investment is approximately $800 million (in nominal dollars) from 2001-2005, and includes the following: 8

~~install~~CINERGY ~~selective catalytic reduction units (SCRs) at several different generating stations;~~ CORP.

~~install~~CONSOLIDATED STATEMENTS ~~other~~OF ~~pollution~~CASH ~~control technologies, including new computer software, at all generating stations;~~ FLOWS

~~make~~(dollars ~~combustion~~in ~~improvements; and~~ thousands)

~~utilize market opportunities to buy and sell NOX allowances.~~ (unaudited)

SCRs are the most proven technology currently available of reducing NOX emissions produced in coal-fired generating stations.

	Successor			Predecessor
	Three Months			Three Months			Six Months
	Ended			Ended			Ended
	June 30, 2006			March 31, 2006			June 30, 2005
Cash Flows from Operating Activities
Net income	$	745		$	79,364		$	168,064
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization	185,868			163,793			306,011
Return on equity investments	11,887			4,857			—
(Gains) losses on sales of equity investments and other assets	5,227			(26,069		)	(70,345		)
Impairment charges	—			7,398			7,542
Deferred income taxes	61,198			(14,309		)	11,094
Equity in earnings of unconsolidated subsidiaries	(5,606		)	(4,095		)	(18,411		)
Accrued pension and postretirement benefit costs	33,310			32,330			57,800
Cumulative effect of change in accounting principle	—			3,493			—
Regulatory asset amortization	9,020			13,367			13,436
(Increase) decrease in:
Net realized and unrealized mark-to-market and hedging transactions	(20,872		)	(154,665		)	93,461
Receivables	189,570			503,549			209,790
Inventory	(44,630		)	102,863			(66,419		)
Other current assets	(68,913		)	8,498			(107,064		)
Increase (decrease) in:
Accounts payable	(59,585		)	(529,943		)	(92,575		)
Taxes accrued	(128,664		)	(60,576		)	(88,091		)
Other current liabilities	(280,646		)	21,309			4,543
Regulatory asset/liability deferrals	89,117			(21,465		)	(66,548		)
Other assets	214,636			56,245			49,111
Other liabilities	(116,590		)	(19,595		)	(93,897		)

Net cash provided by operating activities	75,072			166,349			317,502

Cash Flows from Investing Activities
Capital expenditures	(301,719		)	(298,117		)	(523,979		)
Purchases of emission allowances	(112,096		)	(181,443		)	(150,454		)
Sale of emission allowances	84,253			99,413			131,805
Net proceeds from the sales of equity investments and other assets, and sales of and collection on notes receivable	5,677			5,466			57,779
Other	894			(1,581		)	58,965

Net cash used in investing activities	(322,991		)	(376,262		)	(425,884		)

Cash Flows from Financing Activities
Issuance of long-term debt	325,312			174,069			4,612
Issuance of common stock and common stock related to employee benefit plans	—			28,872			377,623
Redemption of long-term debt	(347,656		)	(13,612		)	(9,487		)
Redemption of preferred stock of subsidiaries	(11,258		)	(20,485		)	—
Notes payable and commercial paper	254,974			166,891			(93,653		)
Dividends paid	—			(127,314		)	(187,076		)
Other	—			2,993			—

Net cash provided by financing activities	221,372			211,414			92,019

Net (decrease) increase in cash and cash equivalents	(26,547		)	1,501			(16,363		)

Cash and cash equivalents at beginning of period	147,557			146,056			164,541

Cash and cash equivalents at end of period	$	121,010		$	147,557		$	148,178

Significant non-cash transactions:
Purchase accounting adjustments	$	4,514,501		$	—		$	—
Allowance for funds used during construction (AFUDC) – equity component	(4,661		)	(3,065		)	(4,402		)
Transfer of generating assets from Duke Energy	1,452,191			—			—

~~(ii) Section~~See ~~126~~Notes ~~Petitions~~to Unaudited Consolidated Financial Statements

In February 1998, the northeast states filed petitions seeking the EPA’s assistance in reducing ozone in the Eastern U.S. under Section 126 of the Clean Air Act (CAA). The EPA believes that Section 126 petitions allow a state to claim that sources in another state are contributing to its air quality problem and request that the EPA require the upwind sources to reduce their emissions. 9

~~In December 1999, the EPA~~THE ~~granted~~CINCINNATI ~~four~~GAS ~~Section~~& ~~126~~ELECTRIC petitions relating to NOX emissions. This ruling affected all of our Ohio and Kentucky facilities, as well as some of our Indiana facilities, and requires us to reduce our NOX emissions to a certain level by May 2003. In May 2001, the Court of Appeals substantially upheld a challenge to the Section 126 requirements, and remanded portions of the rule to the EPA for reconsideration of how growth was factored into the emission limitations. It is uncertain whether the May 2003 compliance deadline will be deferred while the EPA revisits the size of the emission limitations. COMPANY

~~(iii) State~~AND ~~Ozone~~SUBSIDIARY ~~Plans~~COMPANIES

On November 15, 1999, the State of Indiana and the Commonwealth of Kentucky (along with Jefferson County, Kentucky) jointly filed an amendment to their attainment demonstration on how they intend to bring the greater Louisville area, including Floyd and Clark Counties in Indiana, into attainment with the one-hour ozone standard. The SIP amendments call for, among other things, statewide NOX reductions from utilities in Indiana, Kentucky, and surrounding states which are less stringent than the EPA’s NOX SIP Call. Indiana and Kentucky committed to adopt utility NOX control rules by December 2000, that would require controls be installed by May 2003. However, Indiana halted the rulemaking for NOX controls at this level, but completed NOX SIP Call level reduction regulations. Kentucky has completed its rulemaking, and issued a final rule that changed the compliance deadline to mirror the NOX SIP Call of May 31, 2004. 10

~~See~~THE ~~Note~~CINCINNATI ~~4(d)~~GAS ~~below~~& ~~for a discussion of the tentative EPA settlement, which relates to matters~~ELECTRIC ~~discussed within this note.~~COMPANY

(bCONSOLIDATED STATEMENTS )OF ~~New Source Review (NSR)~~OPERATIONS

~~The~~(dollars CAA’s NSR provisions require that a company obtain a pre-construction permit if it plans to build a new stationary source of pollution or make a major modification to an existing facility unless the changes are exempt. In July 1998, the EPA requested comments on proposed revisions to the NSR rules that would change NSR applicability by eliminating exemptions contained in the current regulation. On June 22, 2001, the EPA issued a NSR 90-Day Review Paper and scheduled four public forums across the U.S. to gather more information on the impacts of NSR. Cinergy provided oral testimony at an EPA public forum held in Cincinnati, Ohio on July 10, 2001, and plans to submit written comments as well. thousands)

~~Since July 1999, CG&E and PSI have received requests from the EPA~~ (~~Region 5~~unaudited), under Section 114 of the CAA, seeking documents and information regarding capital and maintenance expenditures at several of their respective generating stations. These requests were part of an industry-wide investigation assessing compliance with the NSR and the New Source Performance Standards (NSPS) of the CAA at electric generating stations.

On September 15, 1999, November 3, 1999, and February 2, 2001, the Attorneys General of New York, Connecticut, and New Jersey, respectively, issued letters notifying Cinergy and CG&E of their intent to sue under the citizens’ suit provisions of the CAA. These states allege violations of the CAA by constructing and continuing to operate a major modification of CG&E’s W.C. Beckjord Generating Station (Beckjord Station) without obtaining the required NSR pre-construction permits.

	Successor			Predecessor
	Three Months Ended			Three Months Ended			Three Months Ended		Six Months Ended
	June 30, 2006			March 31, 2006			June 30, 2005		June 30, 2005
Operating Revenues
Non-regulated electric, natural gas, natural gas liquids, and other	$	399,385		$	421,069		$	307,261	$	599,834
Regulated electric	202,622			219,845			142,263		294,061
Regulated natural gas and natural gas liquids	93,827			321,965			100,468		406,822
Total operating revenues	695,834			962,879			549,992		1,300,717

Operating Expenses
Natural gas and petroleum products purchased	50,993			232,006			56,089		263,871
Operation, maintenance, and other	172,913			173,180			151,464		290,175
Fuel used in electric generation and purchased power	249,679			195,852			143,581		280,171
Costs of fuel resold	28,534			44,291			49,232		90,218
Depreciation and amortization	92,588			67,918			60,533		125,773
Property and other taxes	54,843			68,192			52,256		111,546
Total operating expenses	649,550			781,439			513,155		1,161,754

(Losses) Gains on Sales of Other Assets and Other, net	(5,227		)	26,069			39,535		70,345

Operating Income	41,057			207,509			76,372		209,308

Other Income and Expenses, net	6,886			8,195			3,722		7,298
Interest Expense	28,395			29,680			23,349		46,016

Income from Continuing Operations Before Income Taxes	19,548			186,024			56,745		170,590

Income Tax Expense from Continuing Operations	7,336			67,810			12,345		59,076

Income from Continuing Operations	12,212			118,214			44,400		111,514

(Loss) Income from Discontinued Operations, net of tax	(19,613		)	(1,851		)	9,223		26,775

Net (Loss) Income	$	(7,401	)	$	116,363		$	53,623	$	138,289

Dividends and Premiums on Redemption of Preferred and Preference Stock	—			164			211		423

(Loss) Earnings Available for Common Stockholders	$	(7,401	)	$	116,199		$	53,412	$	137,866

~~On November 3, 1999, the~~See ~~EPA~~Notes sued a number of holding companies and electric utilities, including Cinergy, CG&E, and PSI, in various U.S. District Courts (District Court). The Cinergy, CG&E, and PSI suit alleged violations of the CAA at two of our generating stations relating to ~~NSR and~~Unaudited ~~NSPS~~Consolidated ~~requirements.~~Financial The suit sought (1) injunctive relief to require installation of pollution control technology on each of the generating units at Beckjord Station and at PSI’s Cayuga Generating Station (Cayuga Station), and (2) civil penalties in amounts of up to $27,500 per day for each violation. Statements

On March 1, 2000, the EPA filed an amended complaint against Cinergy, CG&E, and PSI. The amended complaint added alleged violations of the NSR requirements of the CAA at two of our generating stations contained in a notice of violation (NOV) filed by the EPA on November 3, 1999. It also added claims for relief of alleged violations of nonattainment NSR, Indiana and Ohio SIPs, and particulate matter emission limits (as discussed below in the “Beckjord Station NOV” section.) 11

~~The~~THE ~~amended~~CINCINNATI ~~complaint sought~~GAS ~~(1)~~& ~~injunctive relief to require installation of pollution control~~ELECTRIC technology on each of the generating units at Beckjord Station, Cayuga Station, and PSI’s Wabash River Generating Station and Gallagher Generating Station, and such other measures as necessary, and (2) civil penalties in amounts of up to $27,500 per day for each violation. COMPANY

~~On March 1, 2000, the EPA~~CONSOLIDATED ~~also~~BALANCE filed an amended complaint in a separate lawsuit alleging violations of the CAA relating to NSR, Prevention of Significant Deterioration (PSD), and Ohio SIP requirements regarding various generating stations, including a generating station operated by the Columbus Southern Power Company (CSP) and jointly-owned by CSP, the Dayton Power and Light Company (DP&L), and CG&E. The EPA is seeking injunctive relief and civil penalties of up to $27,500 per day for each violation. This suit is being defended by CSP. On April 4, 2001, the District Court in that case ruled that neither the Government nor the intervening plaintiff environmental groups could obtain civil penalties for any alleged violations that occurred more than five years prior to the filing of the complaint, but that both parties could seek injunctive relief for alleged violations that occurred more than five years before the filing of the complaint. Thus, if the plaintiffs prevail in their claims, any calculation for penalties will not start on the date of the alleged violations unless those alleged violations occurred after November 3, 1994, but CSP would be forced to install the controls required under the CAA. Neither party appealed that decision. SHEETS

On June 28, 2000, the EPA issued a NOV to Cinergy, CG&E, and PSI for alleged violations of NSR, PSD, and SIP requirements at CG&E’s Miami Fort Generating Station and PSI’s Gibson Generating Station. In addition, Cinergy and CG&E have been informed by DP&L, the operator of J.M. Stuart Generating Station (~~Stuart~~dollars ~~Station),~~in ~~that on June 30, 2000, the EPA issued a NOV for alleged violations of NSR, PSD, and SIP requirements at this station. CG&E owns 39% of Stuart Station. The NOVs indicated that the EPA may (1~~thousands) ~~issue an order requiring compliance with the requirements of the SIP, or (2) bring a civil action seeking injunctive relief and civil penalties of up to $27,500 per day for each violation.~~

On August 2, 2001, the states of New York, New Jersey, and Connecticut filed an Assented to Motion to Intervene in this litigation. Their motion was granted by the District Court on August 3, 2001. The states’ proposed complaint is an exhibit to the motion to intervene. Cinergy, CG&E and PSI are in the process of evaluating the states' complaint but, at this time, we are unable to determine the effect, if any, that this filing will have on the issues affecting us regarding NSR as framed in the EPA's Amended Complaint. (unaudited)

~~See Note 4(d) below for a discussion of the tentative EPA settlement, which relates to matters discussed within this note.~~ASSETS

(c ) Beckjord Station NOV

	Successor		Predecessor
	June 30,		December 31,
	2006		2005

Current Assets
Cash and cash equivalents	$	21,338	$	9,674
Receivables (net of allowance for doubtful accounts of $7,283 at June 30, 2006 and $3,518 at December 31, 2005)	367,409		422,162
Inventory	148,912		177,638
Assets held for sale	205,414		—
Unrealized gains on mark-to-market and hedging transactions	40,747		543,787
Other	88,262		177,417
Total current assets	872,082		1,330,678

Investments and Other Assets
Restricted funds held in trust	51,214		58,189
Goodwill	2,173,206		—
Intangible assets	849,952		105,275
Unrealized gains on mark-to-market and hedging transactions	33,133		180,197
Assets held for sale	89,807		—
Other	21,463		27,067
Total investments and other assets	3,218,775		370,728

Property, Plant, and Equipment
Cost	8,933,359		7,775,765
Less accumulated depreciation and amortization	1,810,388		2,815,852
Net property, plant, and equipment	7,122,971		4,959,913

Regulatory Assets and Deferred Debits
Deferred debt expense	21,739		30,141
Regulatory assets related to income taxes	73,290		79,495
Other	586,974		462,888
Total regulatory assets and deferred debits	682,003		572,524

Total Assets	$	11,895,831	$	7,233,843

~~On November 30, 1999, the~~See ~~EPA~~Notes filed a NOV against Cinergy and CG&E alleging that emissions of particulate matter at the Beckjord Station exceeded the allowable limit. The NOV indicated that the EPA may (1) issue an administrative penalty order, or (2) file a civil action seeking injunctive relief and civil penalties of up to ~~$27,500~~Unaudited ~~per~~Consolidated ~~day~~Financial for each violation. The allegations contained in this NOV were incorporated within the March 1, 2000 amended complaint, as discussed in Note 4(b) above. On June 22, 2000, the EPA issued a NOV and a Finding of Violation (FOV) alleging additional particulate emission violations at Beckjord Station and offered us an opportunity to meet and discuss the allegations and corrective measures. The NOV/FOV indicated the EPA may issue an administrative compliance order, issue an administrative penalty order, or bring a civil or criminal action. Statements

~~See Note 4(d) below for a discussion of the tentative EPA settlement, which relates to matters discussed within this note.~~12

THE CINCINNATI GAS & ELECTRIC COMPANY CONSOLIDATED BALANCE SHEETS (ddollars )in ~~EPA~~thousands, except ~~Agreement~~per share amounts) (unaudited)

~~On December 21, 2000,~~LIABILITIES ~~Cinergy,~~AND ~~CG&E,~~COMMON ~~and PSI reached an agreement in principle with the EPA, the U.~~STOCKHOLDER’S. Department of Justice, three northeast states, and two environmental groups that could serve as the basis for a negotiated resolution of CAA claims and other related matters brought against coal-fired power plants owned and operated by Cinergy’s operating subsidiaries. The complete resolution of these issues is contingent upon establishing a final agreement with the EPA and other parties. If a final agreement is reached with these parties, this would resolve past claims of NSR violations as well as the Beckjord Station NOVs/FOV discussed above. EQUITY

Under the terms of the tentative agreement, the EPA and the other plaintiffs have agreed to drop all challenges of past maintenance and repair activities at our coal-fired generation plants. In addition, the intent of the tentative agreement is that we would be allowed to continue on-going activities to maintain reliability and availability without subjecting the plants to future litigation regarding federal permitting requirements.

	Successor			Predecessor
	June 30,			December 31,
	2006			2005

Current Liabilities
Accounts payable	$	457,398		$	629,751
Notes payable and commercial paper	309,910			226,352
Taxes accrued	211,401			177,551
Interest accrued	28,448			24,438
Liabilities associated with assets held for sale	186,570			-
Current maturities of long-term debt and preferred stock	5,197			5,042
Unrealized losses on mark-to-market and hedging transactions	57,876			552,105
Other	117,403			212,724
Total current liabilities	1,374,203			1,827,963

Long-term Debt	1,756,069			1,638,027

Deferred Credits and Other Liabilities
Deferred income taxes	1,587,368			1,055,093
Investment tax credit	64,313			67,229
Accrued pension and other postretirement benefit costs	381,242			245,950
Regulatory liabilities	164,198			151,670
Unrealized losses on mark-to-market and hedging transactions	38,161			186,835
Liabilities associated with assets held for sale	91,407			—
Asset retirement obligations	43,157			41,423
Other	187,709			23,736
Total deferred credits and other liabilities	2,557,555			1,771,936

Commitments and Contingencies
Cumulative Preferred Stock Not Subject to Mandatory Redemption	—			20,485

Common Stockholder’s Equity
Common stock, $8.50 par value; 120,000,000 shares authorized and 89,663,086 shares outstanding at June 30, 2006 and December 31, 2005	762,136			762,136
Paid-in capital	5,493,135			603,249
Retained (deficit) earnings	(7,401		)	657,254
Accumulated other comprehensive loss	(39,866		)	(47,207		)
Total common stockholder’s equity	6,208,004			1,975,432

Total Liabilities and Common Stockholder’s Equity	$	11,895,831		$	7,233,843

~~In return for resolution of~~See ~~past~~Notes ~~claims,~~to ~~future~~Unaudited ~~operational~~Consolidated ~~certainty,~~Financial ~~and protection of system wide demand growth, we have tentatively agreed to:~~ Statements

~~shut down or repower with natural gas nine small coal-fired boilers at three power plants beginning in 2004;~~ 13

~~build~~THE ~~four~~CINCINNATI ~~additional~~GAS ~~sulfur~~& ~~dioxide (SO2) scrubbers, the first of which must be~~ELECTRIC ~~operational by December 31, 2007;~~ COMPANY

~~upgrade~~CONSOLIDATED STATEMENTS ~~existing~~OF ~~pollution~~CHANGES ~~control~~IN ~~systems;~~ COMMON STOCKHOLDER’S EQUITY AND COMPREHENSIVE INCOME (LOSS)

(dollars ~~phase~~ in ~~the~~thousands, ~~operation~~except ofper ~~NOX~~share ~~reduction technology year-round starting in 2004;~~ amounts)

~~retire 50,000 tons of SO2 allowances between 2001 and 2005 and reduce our SO2 cap by 35% in 2013;~~ (unaudited)

pay a civil penalty of $8.5 million to the U.S. government; and

								Accumulated			Total
								Other			Common
	Common		Paid-in		Retained			Comprehensive			Stockholder’s
	Stock		Capital		Earnings			Income (Loss)			Equity
Successor

Three Months Ended June 30, 2006

Balance at April 1, 2006	$	762,136	$	4,038,989	$	-		$	-		$	4,801,125

Net income					(7,401		)				(7,401		)
Other comprehensive loss, net of tax effect of $(345)
Cash flow hedges								(210		)	(210		)
Total comprehensive loss											(7,611		)

Transfer of generating assets from Duke Energy(1)			1,452,191					(39,656		)	1,412,535
Other			1,955								1,955

Balance at June 30, 2006	$	762,136	$	5,493,135	$	(7,401	)	$	(39,866	)	$	6,208,004


Predecessor

Three Months Ended March 31, 2006

Balance at January 1, 2006	$	762,136	$	603,249	$	657,254		$	(47,207	)	$	1,975,432

Net income					116,363						116,363
Other comprehensive income, net of tax effect of $86
Minimum pension liability adjustment								854			854
Cash flow hedges								897			897
Total comprehensive income											118,114

Dividends on common stock					(102,256		)				(102,256		)
Dividends on preferred stock					(164		)				(164		)
Other					(1		)	1			—

Balance at March 31, 2006	$	762,136	$	603,249	$	671,196		$	(45,455	)	$	1,991,126

Six Months Ended June 30, 2005

Balance at January 1, 2005	$	762,136	$	584,176	$	610,232		$	(37,831	)	$	1,918,713

Net income					138,289						138,289
Other comprehensive income, net of tax effect of $(1,751)
Cash flow hedges								1,729			1,729
Total comprehensive income											140,018

Dividends on common stock					(104,061		)				(104,061		)
Dividends on preferred stock					(423		)				(423		)
Other					1						1

Balance at June 30, 2005	$	762,136	$	584,176	$	644,038		$	(36,102	)	$	1,954,248

~~implement~~(1) Includes $~~21.5~~39,656 ~~million~~(net of tax benefit of $23,793) related to deferred losses on terminated cash flow hedges included in ~~environmental~~Accumulated ~~mitigation~~Other Comprehensive ~~projects~~Income (Loss). See Note 12(b)(v) to the Consolidated Financial Statements.

~~The~~See ~~estimated~~Notes ~~cost for these capital expenditures is expected~~ to beUnaudited ~~approximately $700 million. These~~Consolidated ~~capital~~Financial expenditures are in addition to our previously announced commitment to install NOX controls over the next five years at an estimated cost of approximately $800 million as previously discussed in “Ozone Transport Rulemaking.” Statements

In reaching the tentative agreement, we did not admit any wrongdoing and remain free to continue our current maintenance practices, as well as implement future projects for improved reliability. If the settlement is not completed, we intend to defend the suit vigorously in court. In such an event, it is not possible to determine the likelihood that the plaintiffs would prevail on their claims or whether resolution of this matter would have a material effect on our financial condition or results of operations. 14

(eTHE )CINCINNATI ~~Manufactured~~GAS ~~Gas~~& ~~Plant (MGP) Sites~~ELECTRIC COMPANY

~~(i) General~~CONSOLIDATED STATEMENTS OF CASH FLOWS

~~Prior~~(dollars toin ~~the 1950s, gas was produced at MGP sites through a process that involved the heating of coal and/or oil. The gas produced from this process was sold for residential, commercial, and industrial uses.~~thousands)

(iiunaudited) ~~PSI~~

Coal tar residues, related hydrocarbons, and various metals associated with MGP sites have been found at former MGP sites in Indiana, including at least 21 sites which PSI or its predecessors previously owned. PSI acquired four of the sites from Northern Indiana Public Service Company (NIPSCO) in 1931. At the same time, PSI sold NIPSCO the sites located in Goshen and Warsaw, Indiana. In 1945, PSI sold 19 of these sites (including the four sites it acquired from NIPSCO) to the predecessor of the Indiana Gas Company, Inc. (IGC). IGC later sold the site located in Rochester, Indiana to NIPSCO.

	Successor			Predecessor
	Three Months Ended			Three Months Ended			Six Months Ended
	June 30, 2006			March 31, 2006			June 30, 2005

Cash Flows from Operating Activities
Net (loss) income	$	(7,401	)	$	116,363		$	138,289
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
Depreciation and amortization	92,588			67,918			125,773
(Gains) losses on sales of equity investments and other assets	5,227			(26,069		)	(70,345		)
Deferred income taxes	8,093			6,793			8,666
Regulatory asset/liability amortization	3,385			6,903			5,314
Accrued pension and postretirement benefit costs	10,626			8,234			14,313
(Increase) decrease in:
Net realized and unrealized mark-to-market and hedging transactions	27,778			(29,301		)	25,741
Receivables	41,550			12,038			7,707
Inventory	(15,658		)	56,177			(32,071		)
Other current assets	25,842			67,659			(78,503		)
Increase (decrease) in:
Accounts payable	66,812			(240,236		)	15,356
Taxes accrued	(21,585		)	49,735			23,006
Other current liabilities	(111,124		)	5,306			855
Regulatory asset/liability deferrals	(7,550		)	(799		)	(6,380		)
Other assets	118,606			17,717			45,845
Other liabilities	(72,306		)	106			5,272

Net cash provided by operating activities	164,883			118,544			228,838

Cash Flows from Investing Activities
Capital expenditures	(149,265		)	(134,356		)	(201,733		)
Purchase of emission allowances	(78,623		)	(155,866		)	(114,694		)
Sale of emission allowances	57,601			97,621			126,676
Net proceeds from the sales of equity investments and other assets, and sales of and collections on notes receivable	—			—			46
Withdrawal of restricted funds held in trust	—			8,137			15,635

Net cash used in investing activities	(170,287		)	(184,464		)	(174,070		)

Filing Compare · CINERGY CORP