SECURITIES AND EXCHANGE COMMISSION
                          Washington, D. C.  20549
                                      
                                  FORM 8-K
                                      
                               CURRENT REPORT
                                      
   Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

     Date of Report (Date of Earliest Event Reported):  January 19, 1996


                        TUCSON ELECTRIC POWER COMPANY
                        -----------------------------

           (Exact name of registrant as specified in its charter)
                                      

       Arizona                      1-5924                  86-0062700
(State of Incorporation)   (Commission File Number)      (IRS Employer
                                                       Identification No.)


                220 West Sixth Street, Tucson, Arizona  85701
             (Address of principal executive office)  (Zip Code)
                                      
                                      
                               (602) 571-4000
            (Registrant's telephone number, including area code)
































Item 5.

As previously reported, in February 1995, the Company filed a Notice
of Intent to form a Holding Company with the Arizona Corporation
Commission (ACC) and on June 13,1995, the Company filed an application
with the ACC requesting an overall 4.9% increase in retail rates
(approximately $28.4 million in annual revenues).  On November 30,
1995, the Company reached a settlement with the ACC Staff proposing to
resolve such applications.  The settlement agreement was subject to
final approval by the ACC.

The settlement agreement called for a one-time base rate increase of
2%, or $10.4 million annually.  Also, the Company agreed not to seek
another increase in base rates before January 1, 2000. The agreement
also would have permitted the Company to invest up to $50 million
annually in energy-related businesses.  Although the agreement would
not have approved the holding company structure, it did provide that
the Company could re-file for authority to establish a holding company
in 18 months from the approval of the settlement agreement.

On January 19, 1996, the ACC voted 2-1 against the proposed agreement.
Each application remains pending.  On January 24,1996, the Company
filed a motion for reconsideration.  The ACC has twenty days in which
to reconsider its decision.  If the ACC does not respond within this
twenty day period, the motion would be considered to have been denied.
If such motion to reconsider is denied, the Company will evaluate how
it will proceed with its rate and holding company applications.

































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

                                      TUCSON ELECTRIC POWER COMPANY
                                      -----------------------------
                                               (Registrant)



Date:  January 26, 1996                             Ira R. Adler
                                      -----------------------------------
                                                    Ira R. Adler
                                      Senior Vice President and Principal
                                               Financial Officer