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U.S. Securities and Exchange Commission


(Release No. 35-27940)

Filings Under the Public Utility Holding Company Act of 1935, as amended ("Act")

January 21, 2005

Notice is hereby given that the following filing(s) has/have been made with the Commission pursuant to provisions of the Act and rules promulgated under the Act. All interested persons are referred to the application(s) and/or declaration(s) for complete statements of the proposed transaction(s) summarized below. The application(s) and/or declaration(s) and any amendment(s) is/are available for public inspection through the Commission's Branch of Public Reference.

Interested persons wishing to comment or request a hearing on the application(s) and/or declaration(s) should submit their views in writing by February 15, 2005, to the Secretary, Securities and Exchange Commission, Washington, D.C. 20549-0609, and serve a copy on the relevant applicant(s) and/or declarant(s) at the address(es) specified below. Proof of service (by affidavit or, in the case of an attorney at law, by certificate) should be filed with the request. Any request for hearing should identify specifically the issues of facts or law that are disputed. A person who so requests will be notified of any hearing, if ordered, and will receive a copy of any notice or order issued in the matter. After February 15, 2005, the application(s) and/or declaration(s), as filed or as amended, may be granted and/or permitted to become effective.

Cinergy Corporation (70-10254)

Cinergy Corp., a registered holding company ("Cinergy"), and its subsidiary The Cincinnati Gas & Electric Company, an exempt public utility holding company ("CG&E"; and together with Cinergy, "Declarants"), both at 139 East Fourth Street, Cincinnati, OH 45202, have jointly filed a declaration ("Declaration") pursuant to Sections 12(b), 12(d) and 12(f) of the Act and rules 43, 44, 45 and 54 under the Act.

CG&E proposes to transfer to its subsidiary, The Union Light, Heat and Power Company ("ULH&P"), CG&E's ownership interest in three electric generating facilities, including certain realty and other improvements, equipment, assets, properties, facilities and rights (collectively, the "Plants") (the "Transfer").

I. Background

Cinergy, through CG&E, ULH&P and PSI Energy, Inc. ("PSI"), provides retail electric and natural gas service to customers in southwestern Ohio, northern Kentucky and most of Indiana. In addition, Cinergy has numerous non-utility subsidiaries. As of June 30, 2004, Cinergy reported consolidated total assets of approximately $14.0 billion and consolidated total operating revenues of approximately $2.3 billion. Cinergy directly holds all the outstanding common stock of CG&E.

CG&E is a combination electric and gas public utility holding company formed under Ohio law. CG&E claims an exemption from the provisions of the Act under Section 3(a) (2) pursuant to rule 2. CG&E is engaged in the production, transmission, distribution and sale of electric energy and the sale and transportation of natural gas in the southwestern portion of Ohio and, through ULH&P, northern Kentucky. The area served with electricity, gas, or both is approximately 3,200 square miles, has an estimated population of two million people, and includes the cities of Cincinnati and Middletown in Ohio and Covington and Newport in Kentucky.

The Public Utilities Commission of Ohio ("PUCO") regulates CG&E's retail sales of electricity and natural gas. CG&E's wholesale power sales and transmission services are regulated by the Federal Energy Regulatory Commission ("FERC") under the Federal Power Act. CG&E currently provides ULH&P full requirements electric service under a long-term power sales agreement, FERC Rate Schedule No. 56. As of June 30, 2004, CG&E reported consolidated total operating revenues of approximately $1.3 billion and consolidated total assets of approximately $5.9 billion.

ULH&P, formed under Kentucky law, is a direct wholly-owned subsidiary of CG&E. ULH&P is engaged in the transmission, distribution, and sale of electric energy and the sale and transportation of natural gas in northern Kentucky. The area it serves with electricity and gas covers approximately 500 square miles, has an estimated population of 330,000 people, and includes the cities of Covington and Newport, Kentucky. ULH&P owns no electric generating facilities. It historically has relied on CG&E for its full requirements of electric supply to serve its retail customers. ULH&P's retail sales of electricity and of natural gas are regulated by the Kentucky Public Service Commission ("KPSC"). ULH&P has no wholesale customers. As of June 30, 2004, ULH&P reported total operating revenues of approximately $187 million and total assets of approximately $444 million.

The KPSC has issued an order approving the acquisitions by ULH&P. Declarants state that, pursuant to Ohio's electric customer choice legislation which went into effect in January 2001, PUCO has no approval authority over the sale of the Plants by CG&E or otherwise with respect to the Transfer.

II. Proposed Transfer

The three electric generating stations that are the subject of the Transfer are: East Bend Generating Station ("East Bend"); the Miami Fort Unit 6 ("Miami Fort 6"); and Woodsdale Generating Station ("Woodsdale").

East Bend is a 648 MW coal-fired base load station located in Rabbit Hash, Kentucky. East Bend is jointly owned by CG&E (69 percent) and The Dayton Power & Light Company ("DP&L") (31 percent). CG&E proposes to transfer its entire ownership share (447 MW nameplate rating). At June 30, 2004, the net book value of CG&E's ownership interest in East Bend was approximately $200 million (including construction-work-in-progress ("CWIP") costs of approximately $4.6 million).

Miami Fort 6 is a 168 MW coal-fired intermediate load generating unit located in North Bend, Ohio. Miami Fort 6 is wholly-owned by CG&E, but is part of the larger Miami Fort Generating Station, which is jointly owned by CG&E and DP&L. At June 30, 2004, Miami Fort 6 had a net book value of approximately $21 million (including CWIP of approximately $4.6 million).

Woodsdale is a 490 MW dual-fuel combustion-turbine peaking station that operates on either natural gas or propane and is located in Trenton, Ohio. Woodsdale is wholly-owned by CG&E. At June 30, 2004, the net book value of Woodsdale was approximately $153 million (including CWIP of approximately $11 million).

CG&E will transfer the Plants at net book value at closing, plus CWIP and transaction costs. Declarants represent that as of June 30, 2004, the net book value of the Plants was approximately $353.8 million. CWIP, as of June 30, 2004, was approximately $20.2 million. Transaction costs will be approximately $4.9 million.

CG&E proposes to transfer its right, title and interest in and to the three electric generating stations, together in each case with certain realty and other improvements, equipment, assets, properties, facilities (e.g., inventories of fuel, supplies, materials and spare parts) associated with or ancillary to each Plant. CG&E will retain all transmission facilities and generation step-up transformers or other FERC-jurisdictional facilities physically connected to the Plants.

Declarants state that the Plants are in good operating condition and are directly interconnected to the Cinergy joint transmission system. Following the Transfer, CG&E will continue to operate Miami Fort 6. UHL&P will operate East Bend and Woodsdale with assistance, provided at cost, from Cinergy Services, Inc. (Cinergy's service company subsidiary) in accordance with its utility service agreement and with assistance from CG&E, on an as-needed basis, pursuant to the exemption under rule 87(a) (3).

The Plants will be transferred pursuant to the terms of separate but substantially identical Asset Transfer Agreements.

At closing, ULH&P will compensate CG&E at cost for inventories of fuels, supplies, materials and spare parts of CG&E located at or in transit to the Plants. Also at closing, ULH&P will reimburse CG&E for the transaction costs incurred by CG&E or any of its affiliates in connection with the Transfer.

ULH&P will fund its acquisition of the Plants with debt and equity, in reliance on existing Commission authorization and/or the exemption for state commission-authorized financings under rule 52(a). ULH&P anticipates the equity to be additional common stock and the debt to be long term debt with an expected maturity of less than 40 years. ULH&P may issue some or all of that long term debt to CG&E.

For the Commission, by the Division of Investment Management, pursuant to delegated authority.

Margaret H. McFarland
Deputy Secretary


Modified: 02/01/2005