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

FORM U-13-60

ANNUAL REPORT

For the Period
Beginning January 1, 2002 and Ending December 31, 2002

to the

U.S. SECURITIES AND EXCHANGE COMMISSION

OF

LG&E ENERGY SERVICES INC.
(Exact Name of Reporting Company)

a Subsidiary Service Company
("Mutual" or "Subsidiary")

Date of Incorporation: June 2, 2000

If not Incorporated, Date of Organization: N/A

State of Sovereign Power under which Incorporated or Organized: Kentucky

Location of Principal Executive Offices of Reporting Company: Louisville, Kentucky

Name, title, and address of officer to whom correspondence concerning this report should be addressed:

Mr. Ulrich Hueppe
Executive Vice President
E.ON AG
E.ON—Platz 1
40479 Dusseldorf
Germany

Name of Principal Holding Company Whose Subsidiaries are served by Reporting Company: E.ON AG

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LISTING OF SCHEDULES AND ANALYSIS OF ACCOUNTS

Description of Schedules and Accounts		Schedule or Account Number		Page Number
Comparative Balance Sheet		Schedule I		3
Service Company Property		Schedule II		5
Accumulated Provision for Depreciation and Amortization of Service Company Property		Schedule III		6
Investments		Schedule IV		7
Accounts Receivable from Associate Companies		Schedule V		8
Fuel Stock Expenses—Undistributed		Schedule VI		10
Stores Expense—Undistributed		Schedule VII		11
Miscellaneous Current and Accrued Assets		Schedule VIII		12
Miscellaneous Deferred Debits		Schedule IX		13
Research, Development, or Demonstration Expenditures		Schedule X		14
Proprietary Capital		Schedule XI		15
Long-Term Debt		Schedule XII		16
Current and Accrued Liabilities		Schedule XIII		17
Notes to Financial Statements		Schedule XIV		18
Comparative Income Statement		Schedule XV		20
Analysis of Billing—Associate Companies		Account 457		21
Analysis of Billing—Non-associate Companies		Account 458		22
Analysis of Charges for Service—Associate and Non-associate Companies		Schedule XVI		23
Schedule of Expense of Department or Service Function		Schedule XVII		24
Departmental Analysis of Salaries		Account 920		30
Outside Services Employed		Account 923		31
Employee Pensions and Benefits		Account 926		44
General Advertising Expenses		Account 930.1		44
Miscellaneous General Expenses		Account 930.2		44
Rents		Account 931		46
Taxes Other than Income Taxes		Account 408		46
Donations		Account 426.1		47
Other Deductions		Account 426.5		48
Notes to Statement of Income		Schedule XVIII		48
Financial Data		Schedule XIX		48

LISTING OF INSTRUCTIONAL FILING REQUIREMENTS

Organization Chart		49
Methods of Allocation		49
Annual Statement of Compensation for Use of Capital Billed		52
Signature Clause		53
Supplemental Information, as required in merger order		54

2

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ANNUAL REPORT TO THE SEC OF LG&E ENERGY SERVICES INC.
Schedule I—Comparative Balance Sheet

        Give balance sheet of the Company as of December 31 of the current and prior year.

					2002		2001
			Service Company Property
101			Service Company Property (Schedule II)		1,620,382		0
107			Construction work in Progress (Schedule II)		2,243,827		1,961,718
			Total Property		3,864,209		1,961,718
108			Less Accumulated Provision for Deprec & Amort (Schedule III)		-420,133		0
			Net Service Company Property		3,444,076		1,961,718
			Investments
123			Investments in Associate Co's (Schedule IV)		0		0
124			Other Investments (Schedule IV)		0		0
128			Other Special Funds		0		0
			Total Investments		0		0
			Current and Accrued Assets
131			Cash		-15,795,284		-16,479,192
134			Special deposits		0		0
135			Working Funds		0		0
136			Temporary Cash Investments (Schedule IV)		0		0
141			Notes Receivable		0		0
143			Accounts Receivable		168,060		127,334
144			Accumulated Provision for Uncollectible Accounts		0		0
146			Accounts Receivable from Associate Co's (Schedule V)		88,058,418		76,596,908
145			Notes Receivable from Associated Co's		0		0
152			Fuel Stock Expenses Undistributed (Schedule VI)		0		0
154			Materials and Supplies		0		0
163			Stores Expense Undistributed (Schedule VII)		0		0
165			Prepayments		0		0
174			Misc. Current & Accrued Assets (Schedule VIII)		0		0
			Total Current and Accrued Assets		72,431,194		60,245,050
			Deferred Debits
181			Unamortized Debt Expense		0		0
184			Clearing Accounts		453,742		37,845
186			Misc. Deferred Debits (Schedule IX)		5,698,668		2,701,342
188			Research, Develop. or Demonstrtn Expenditures (Schedule X)		0		0
190			Accumulated. Deferred Income Taxes		0		0
			Total Deferred Debits		6,152,410		2,739,187
			TOTAL ASSETS AND OTHER DEBITS		82,027,680		64,945,955

3

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			Proprietary Capital
201			Common Stock Issued (Schedule XI)		100		100
211			Misc. Paid-In-Capital (Schedule XI)		900		900
214			Cap Stock Expense-Common		0		0
214.2			Other Income-Minimum Pension Liability		0		-996,526
215			Appropriated Retained Earnings		0		0
216			Unappropriated Retained Earnings (Schedule XI)		0		0
219			OCI—Minimum Pension Liability		-7,251,111		0
					-7,250,111		-995,526
			Long-Term Debt
223			Advances from Associate Co's (Schedule XII)		0		0
224			Other Long-Term Debt (Schedule XII)		0		0
225			Unamortized Premium on Long-Term Debt		0		0
226			Unamortized Discount on Long-Term Debt-Debit		0		0
227			Capital Leases		0		0
			Total Long-Term Debt		0		0
			Current and Accrued Liabilities
228.2			Injuries and Damages		0		0
228.3			Accumulated. Provision for Pensions and Benefits		5,628,516		1,653,788
231			Notes Payable		0		0
232			Accounts Payable		71,007,472		52,637,987
233			Notes Payable to Associate Co's (Schedule XIII)		0		0
234			Account Payable to Associate Co's (Schedule XIII)		22,300,033		5,933,611
235			Customer Deposits		0		0
236			Taxes Accrued		-1,320,239		1,826,243
237			Interest Accrued		0		0
238			Dividends Declared		0		0
241			Tax Collections Payable		148,520		465,656
242			Misc. Current & Accrued Liabilities (Schedule XIII)		5,432,269		3,763,055
			Total Current and Accrued Liabilities		103,196,571		66,280,340
			Deferred Credits
253			Other Deferred Credits		0		325,492
255			Accumulated. Deferred Investment Tax Credits		0		0
			Total Deferred Credits		0		325,492
282			Accumulated. Deferred Income Taxes		0		0
283			Deferred Income Tax—Other		-13,918,780		-664,351
			TOTAL LIABILITIES AND PROPRIETARY CAPITAL		82,027,680		64,945,955

4

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Schedule II—Service Company Property

Account			Description		Balance at Beginning of Year		Debits		Credits		Balance at Close of Year
301			Organization		—		—		—		—
303			Misc. Intangible Plant		—		—		—		—
389			Land & Land Rights		—		—		—		—
390			Structures & Improvements		—		—		—		—
391			Office Furniture & Equipment		—		1,620,382		—		1,620,382
392			Transportation		—		—		—		—
397			Communication Equipment		—		—		—		—
399			Other Tangible Property		—		—		—		—
			Subtotal		—		1,620,382		—		1,620,382
107			Construction Work In Progress		1,961,718		16,790,798		16,508,689		2,243,827
			TOTAL		1,961,718		18,411,180		16,508,689		3,864,209

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(1)

Provide an explanation of those changes considered material:

None

(2)

Subaccounts are required for each class of equipment owned. The Service Company shall provide a listing by subaccount of equipment additions during the year and the balance at the close of the year:

(3)

Describe other Service Company Property:

None

5

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Schedule III—Accumulated Provision for Depreciation and Amortization of Service Company Property.

Account			Description		Balance at Beginning of Year		Additions		Retirements		Balance at Close of Year
301			Organization		0		0		0		0
303			Misc. Intangible Plant		0		0		0		0
389			Land & Land Rights		0		0		0		0
390			Structures & Improvements		0		0		0		0
391			Office Furniture & Equipment		0		420,133		0		420,133
392			Transportation		0		0		0		0
397			Communication Equipment		0		0		0		0
399			Other Tangible Property		0		0		0		0
			TOTAL		0		420,133		—		420,133

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(1)

Provide an explanation of those changes considered material:

None

6

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Schedule IV—Investments

Instructions:

        Complete the following schedule concerning investments, Under Account 124 "Other Investments," state each investment separately, with description, including, the name of issuing company, number of shares or principal amount, etc. Under Account 135, "Temporary Cash Investment," list each investment separately.

7

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Schedule V—Accounts Receivable from Associate Companies

Instructions:

        Complete the following schedule listing accounts receivable from each associate company. Where the service company has provided accommodation or convenience payments for associate companies, a separate listing of total payments for each associate company by subaccount should be provided.

Account 146—Accounts Receivable from Associate Companies

Description		Balance at Beginning of Year		Balance at End of Year
LG&E Enertech Inc.		2,717,239		382,192
LG&E Home Services Inc.		580,669		817
LG&E Capital Corp.		8,496,776		21,220,603
LG&E Credit Corp.		71		0
LG&E Capital Trimble County LLC		232,677		0
Louisville Gas and Electric Company		29,941,800		22,137,225
Kentucky Utilities Company		19,357,860		17,818,515
Western Kentucky Energy Corp.		1,480,823		1,522,635
LG&E Energy Corp.		4,150,827		14,463,299
LG&E Power Inc.		1,758,496		0
LG&E Energy Marketing Inc. (Continuing)		2,199,564		0
LG&E International Inc.		1,438		0
LG&E Power Argentina II Inc.		73,498		0
LG&E Power Development Inc. (Fairfax)		3,995,582		0
LG&E Energy Marketing Inc. (Discontinued)		807,387		0
CRC-Evans International Inc.		51,963		0
Powergen plc		599,695		303,130
LG&E Power Development Inc. (Costa Mesa)		110,495		0
LG&E Energy Foundation Inc.		40,048		10,783
E.ON		0		229,084
FSF Minerals		0		149
FCD LLC		0		153
LPD—Tiger Creek Management		0		9,969,833
TOTAL		76,596,908		88,058,418

8

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Analysis of Convenience or Accommodation Payments:

Convenience payments result primarily from the following items:

9

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Schedule VI—Fuel Stock Expenses Undistributed

Instructions:

        Report the amount of labor and expenses incurred with respect to fuel stock expenses during the year and indicate amount attributable to each associated company. Under the section headed "Summary" listed below give an overall report of the fuel functions performed by the service company.

Summary:

        Fuel functions provided by the service company include the procurement of coal and limestone and the transportation services to move the coal and limestone from the loading point to the power plant, monitor inventory level and forecasted requirements and make purchases as needed on a timely basis, prepare bid solicitations for coal and limestone, evaluate the bids, negotiate and write the contracts and purchase orders, and contract administration.

10

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Schedule VII—Stores Expense Undistributed

Instructions:

        Report the amount of labor and expenses incurred with respect to stores expense during the year and indicate amount attributable to each associate company.

11

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Schedule VIII—Miscellaneous Current and Accrued Assets

Instructions:

        Provide detail of items in this account. Items less than $10,000 may be grouped, showing the number of items in each group.

12

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Schedule IX—Miscellaneous Deferred Debits

Instructions:

        Provide detail of items in this account. Items less than $10,000 may be grouped by class showing the number of items in each class.

13

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Schedule X—Research, Development or Demonstration Expenditures

Instruction:

        Provide a description of each material research, development, or demonstration project which incurred costs by the service corporation during the year.

14

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Schedule XI—Proprietary Capital

Account No.		Class of Stock		Number of Shares Authorized		Par or Stated Value per Share			Outstanding close of Period No. of Shares		Total Amount
201		Common Stock		100		$	1.00		100		$	100.00

Instructions:

        Classify amounts in each account with brief explanation, disclosing the general nature of transactions which give rise to the reported amounts.

Instructions:

        Give particulars concerning net income or (loss) during the year, distinguishing between compensation for the use of capital owed or net loss remaining from servicing non-associates per the General Instructions of the Uniform System of Accounts. For dividends paid during the year in cash or otherwise, provide rate percentage, amount of dividend, date declared and date paid.

15

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Schedule XII—Long Term Debt

Instructions:

        Advances from associate companies should be reported separately for advance on notes, and advances on open account. Names of associate companies from which advances were received shall be shown under the class and series of obligation column. For Account 224—Other long-term debt provide the name of creditor company or organization, terms of the obligation, date of maturity, interest rate, and the amount authorized and outstanding.

Name of Creditor			Terms of Obligation Class & Series of Obligation		Date of Maturity		Interest Rate		Amount Authorized		Balance at Beginning of Year		Additions		Deductions		Balance at Close of Year
Account 223—Advances from Associate Companies									NONE		0						0
Account 224—Other Long-Term Debt											0		0		0		0
	TOTAL										0		0		0		0

Give an explanation of Deductions:

        NONE

16

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Schedule XIII—Current and Accrued Liabilities

Instructions:

        Provide balance of notes and accounts payable to each associate company. Give description and amount of miscellaneous current and accrued liabilities. Items less than $10,000 may be grouped, showing the number of items in each group.

		Balance at
Description
		Beginning of Year		Close of Year
Account 233—Notes Payable to Associate Companies		NONE		NONE
Account 234—Accounts Payable to Associate Companies
LG&E Capital Corp.		2,714,030		244,619
LG&E Enertech Inc.		422,283		-4,956
Louisville Gas and Electric Company		709,841		378,343
Kentucky Utilities Company		1,443,739		501,526
Western Kentucky Energy Corp.		158,956		-19,611
LG&E Home Services Inc.		7,369		0
LG&E Energy Corp.		0		15,799,182
LG&E Energy Marketing Inc. (Continuing)		45,301		0
LPD—Tiger Creek		0		4,967,773
E.ON		0		34,102
Powergen plc		432,092		399,055
TOTAL		5,933,611		22,300,033
Account 242—Miscellaneous Current and Accrued Liabilities
Misc. Liability—Vested Vacation		3,763,055		5,432,269
TOTAL		3,763,055		5,432,269

17

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Schedule XIV—Notes to Financial Statements

Instructions:

        The space below is provided for important notes regarding the financial statements or any account thereof. Furnish particulars as to any significant contingent assets or liabilities existing at the end of the year. Notes relating to financial statements shown elsewhere in this report may be indicated here by reference.

Note 1—Summary of Significant Accounting Policies

A.

Organization of the Company

        LG&E Energy Services Inc. (the Company or SERVCO) is a wholly-owned subsidiary of LG&E Energy Corp. (LEC), registered under the Public Utility Holding Company Act of 1935 (PUHCA). The Company was authorized to conduct business as a service company for LEC and its various subsidiaries by order of the Securities and Exchange Commission (SEC) dated December 6, 2000, and commenced operations January 1, 2001. On July 1, 2002, E.ON AG (E.ON) completed its acquisition of Powergen plc, now Powergen Limited, which includes LEC for approximately £5.1 billion ($7.3 billion). Following the acquisition, E.ON became a registered holding company under PUHCA and LEC continued to be subject to the additional regulation under PUHCA.

        The Company is organized along functional lines to accomplish its purpose of providing management, administrative, and technical services. These services are priced so that the Company operates on a break-even basis.

        The Company maintains its accounts in accordance with PUHCA, as administered by the SEC, and has adopted a system of accounts consistent with that prescribed by the Federal Energy Regulatory Commission. The accounting policies of the Company conform to U.S. generally accepted accounting principles (GAAP).

B.

Cash and Cash Equivalents

        The Company considers all highly liquid debt instruments purchased with a maturity of three months or less to be cash equivalents. Temporary cash investments are carried at cost, which approximates fair value.

C.

Income Taxes

        The Company accounts for income taxes pursuant to Statement of Financial Accounting Standards No. 109 "Accounting For Income Taxes" (FAS 109). This standard requires that deferred income taxes be recorded for all temporary differences between the financial statement and tax basis of assets, liabilities and loss carryforwards. Deferred tax balances are based on enacted tax laws at tax rates that are expected to be in effect when the temporary differences reverse. Through December 31, 2002, the Company was part of the Powergen US Investments Corp. consolidated Federal income tax return which includes LEC and all other eligible U.S. subsidiaries.

D.

Management's Use of Estimates

        The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported assets and liabilities and disclosure of contingent items at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from these estimates.

18

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E.

Fair Value of Financial Instruments

        The carrying amounts of financial instruments on the Company's books are a reasonable estimate of their fair value.

Note 2—Common Stock

        The Company is authorized to issue 100 shares of common stock at a par value of one dollar ($1.00) per share. LEC holds all of the Company's common stock. At December 31, 2002 there were 100 shares outstanding.

Note 3—Related Party Transactions

        The Company has transactions in the normal course of business with other LEC subsidiaries. These transactions are primarily composed of services received or rendered. Intercompany receivables were approximately $88,058,418 at December 31, 2002. Intercompany payables totaled approximately $22,300,033 at December 31, 2002.

19

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Schedule XV Statement of Income

Account			Description		2002		2001
INCOME
	457		Services Rendered to Associate Companies		335,374,413		245,156,275
	458		Services Rendered to Non-Associate Companies		0		0
	400		Sales Revenue—General		0		0
	415		Rev From Energy Cat		0		0
	419		Other Interest Inc		0		0
	421		Miscellaneous Income and Loss		0		0
			TOTAL INCOME		335,374,413		245,156,275
EXPENSES
	901		Supervision		0		0
	902		Meter Reading		0		2,278
	903		Customer Records & Collection Expenses		0		261,684
	909		Informational & Instructional Adver.		0		130,151
	912		Gen'l Marketing & Marketing Programs		0		794
	913		Other Adver—Sales		0		1,500
	920		Salaries and Wages		86,952,633		89,174,202
	921		Office Supplies and Expenses		66,717,060		77,532,176
	922		Administrative Expenses Transferred—Credit		0		0
	923		Outside Services Employed		164,289,815		51,535,693
	924		Property Insurance		496		303
	925		Injuries and Damages		201,719		142,690
	926		Employee Pensions and Benefits		8,250,371		11,026,395
	928		Regulatory Commission Expenses		535,476		175,899
	930.1		General Advertising Expenses		222,989		221,485
	930.2		Miscellaneous General Expenses		573,412		1,967,375
	931		Rents		71,768		56,603
	932		Maintenance of Structures and Equipment		0		0
	935		Mtce-Communication EQ		42,786		10,401
	401		Operation Expense		0		0
	403		Depreciation and Amortization Expense		423,941		80,657
	408		Taxes other than Income Taxes		506,159		5,840,923
	409		Income Taxes		0		-165,699
	410		Provision for Deferred Income Taxes		0		0
	411		Provision for Deferred Income Taxes—Credit		0		0
	411.5		Investment Tax Credit		0		0
	425		Amortization—Other		0		0
	426.1		Donations		100,464		62,802
	426.2		Life Insurance		126,015		756,505
	426.3		Penalties		544		1,502
	426.4		Civic, Political & Related Act.		167,316		245,039
	426.5		Other Deductions		5,878,579		4,325,100
	427		Interest on Long Term Debt		0		0
	430		Interest on Debt to Associate Companies		0		0
	431		Other Interest Expense		312,870		1,769,817
	588		Misc. Distribution Expenses		0		0
			TOTAL EXPENSE		335,374,413		245,156,275
			NET INCOME OR (LOSS)		0		0

20

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Analysis of Billing
Associate Companies—Account 457

		DIRECT COSTS CHARGED		INDIRECT COSTS CHARGED		COMPENSATION FOR USE OF CAPITAL		TOTAL AMOUNT BILLED
NAME OF ASSOCIATE COMPANY
Louisville Gas and Electric Company		92,595,494		2,404,090		0		94,999,584
Kentucky Utilities Company		72,754,694		2,126,383		0		74,881,077
Western Kentucky Energy Corp.		6,625,452		63,401		0		6,688,853
LG&E Energy Corp.		486,876		0		0		486,876
LG&E Capital Corp.		20,130,625		1,475,791		0		21,606,416
LG&E Home Services Inc.		320,040		0		0		320,040
LG&E Enertech Inc.		5,225,886		289		0		5,226,175
LPI Power Gen		3,170,825		108,882		0		3,279,707
LG&E Credit Corp.		3,353		0		0		3,353
LG&E Energy Marketing Inc. (Continuing)		9,722,145		306,602		0		10,028,747
LG&E International		7,252		0		0		7,252
LG&E Argentina		908,023		0		0		908,023
LG&E Power Development Inc. (Fairfax)		783,961		98,228		0		882,189
LG&E Energy Marketing Inc. (Discontinued)		6,548,672		1,408,272		0		7,956,944
CRC Evans		322,717		0		0		322,717
Powergen plc		1,476,783		0		0		1,476,783
LG&E Power Development Inc. (Costa Mesa)		11,247		0		0		11,247
LG&E Energy Foundation Inc.		46,569		0		0		46,569
LPD—Tiger Creek Management		105,604,314		0		0		105,604,314
E.ON		637,547		0		0		637,547
TOTAL		327,382,475		7,991,938		0		335,374,413

21

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Analysis of Billing
Non-associate Companies—Account 458

Instruction:

        Provide a brief description of the services rendered to each non-associate company:

		DIRECT COSTS CHARGED		INDIRECT COSTS CHARGED		COMPENSATION FOR USE OF CAPITAL		TOTAL AMOUNT BILLED
NAME OF NON-ASSOCIATE COMPANY
NONE		0		0		0		0
TOTAL		0		0		0		0

22

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Schedule XVI—Analysis of Charges for Service—Associate and Non-associate Companies

				ASSOCIATE COMPANY CHARGES						NON-ASSOCIATE COMPANY CHARGES						TOTAL CHARGES
ACCOUNT		DESCRIPTION OF ITEMS		DIRECT COST		INDIRECT COST		TOTAL		DIRECT COST		INDIRECT COST		TOTAL		DIRECT COST		INDIRECT COST		TOTAL
901		Supervision		0		0		0		0		0		0		0		0		0
902		Meter Reading		0		0		0		0		0		0		0		0		0
903		Customer Records and Collection Expenses		0		0		0		0		0		0		0		0		0
909		Informational & Instructional Adver.		0		0		0		0		0		0		0		0		0
912		Gen'l Marketing & Marketing Programs		0		0		0		0		0		0		0		0		0
913		Other Adver—Sales		0		0		0		0		0		0		0		0		0
920		Salaries & Wages		82,579,895		4,372,738		86,952,633		0		0		0		82,579,895		4,372,738		86,952,633
921		Office Supplies & Expenses		65,247,373		1,469,687		66,717,060		0		0		0		65,247,373		1,469,687		66,717,060
922		Administrative Expense		0		0		0		0		0		0		0		0		0
923		Outside Services Employed		164,022,271		267,543		164,289,814		0		0		0		164,022,271		267,543		164,289,814
924		Property Insurance		496		0		496		0		0		0		496		0		496
925		Injuries and Damages		198,252		3,467		201,719		0		0		0		198,252		3,467		201,719
926		Employee Pensions and Benefits		7,685,607		564,765		8,250,372		0		0		0		7,685,607		564,765		8,250,372
928		Regulatory Commission Expense		535,476		0		535,476		0		0		0		535,476		0		535,476
930.1		General Advertising Expense		222,989		0		222,989		0		0		0		222,989		0		222,989
930.2		Miscellaneous General Expenses		573,412		0		573,412		0		0		0		573,412		0		573,412
931		Rents		71,768		0		71,768		0		0		0		71,768		0		71,768
932		Maintenance of Structures and Equipment		0		0		0		0		0		0		0		0		0
935		Mtce-Communication EQ		42,786		0		42,786		0		0		0		42,786		0		42,786
401		Operation Expense		0		0		0		0		0		0		0		0		0
403		Depreciation and Amortization Expenses		423,941		0		423,941		0		0		0		423,941		0		423,941
408		Taxes Other than Income Taxes		464,829		41,330		506,159		0		0		0		464,829		41,330		506,159
409		Income Taxes		0		0		0		0		0		0		0		0		0
410		Provision for Deferred Income Taxes		0		0		0		0		0		0		0		0		0
411		Provision for Deferred Income Taxes-Credit		0		0		0		0		0		0		0		0		0
411.5		Investment Tax Credit		0		0		0		0		0		0		0		0		0
425		Amortization—Other		0		0		0		0		0		0		0		0		0
426.1		Donations		100,464		0		100,464		0		0		0		100,464		0		100,464
426.2		Life Insurance		126,015		0		126,015		0		0		0		126,015		0		126,015
426.3		Penalties		544		0		544		0		0		0		544		0		544
426.4		Civic, Political & Related Act		167,316		0		167,316		0		0		0		167,316		0		167,316
426.5		Other Deductions		4,606,171		1,272,408		5,878,579		0		0		0		4,606,171		1,272,408		5,878,579
427		Interest on Long Term Debt		0		0		0		0		0		0		0		0		0
431		Other Interest Expense		312,870		0		312,870		0		0		0		312,870		0		312,870
588		Misc. Distribution Expenses		0		0		0		0		0		0		0		0		0
		TOTAL EXPENSES		327,382,475		7,991,938		335,374,413		0		0		0		327,382,475		7,991,938		335,374,413
457.3		Compensation for use of Equity		0		0		0		0		0		0		0		0		0
430		Interest on Debt to Associate Co		0		0		0		0		0		0		0		0		0
		TOTAL COST OF SERVICE		327,382,475		7,991,938		335,374,413		0		0		0		327,382,475		7,991,938		335,374,413

23

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Schedule XVII—Schedule of Expense
Distribution by Department or Service Function

Instructions:

        Indicate each department or service function. (See Instruction 01-3 General Structure of Accounting System:Uniform System of Accounts).

ACCT		DESCRIPTION		TOTAL		SLS/MKT		CUS SRV		METR'G		REV CLL		FWR GEN		FUEL PR		TRNSMSN		REG AFR
901		Supervision		—		—		—		44,944		—		—		—		—		—
902		Meter Reading		—		—		—		—		—		—		—		—		—
903		Customer Records & Collection Exp.		—		—		—		—		—		—		—		—		—
909		Infor. & Instruc. Adver		—		—		—		—		—		—		—		—		—
912		Gen'l Marketing & Marketing Programs		—		—		—		—		—		—		—		—		—
913		Other Adver—Sales		—		—		—		—		—		—		—		—		—
920		Salaries and Wages		86,952,633		3,656,147		4,737,547		211,661		812,481		4,894,189		909,253		4,206,710		852,750
921		Office Supplies and Expenses		66,717,060		837,993		1,149,538		(25,422	)	308,696		2,767,584		259,977		1,320,465		229,060
922		Administrative Expenses Transferred—Credit		—		—		—		—		—		—		—		—		—
923		Outside Services Employed		164,289,815		8,133,888		316,298		5,059		66,463		109,666,249		168,678		478,327		344,161
924		Property Insurance		496		—		—		—		—		—		—		—		—
925		Injuries and Damages		201,719		—		55		—		—		—		—		—		—
926		Employee Pensions and Benefits		8,250,371		—		—		—		—		—		—		—		—
928		Regulatory Commission Expenses		535,476		—		—		—		—		—		—		—		535,476
930.1		General Advertising Expenses		222,989		9,509		—		—		—		—		—		—		—
930.2		Miscellaneous General Expenses		573,412		166,465		—		—		—		175,446		—		—		435
931		Rents		71,768		71,174		—		—		—		—		—		—		—
932		Maintenance of Structures and Equipment		—		—		—		—		—		—		—		—		—
935		Mtce-Communication EQ		42,786		—		—		4,588		—		—		—		—		—
401		Operation Expense		—		—		—		—		—		—		—		—		—
403		Depreciation and Amortization Expense		423,941		3,808		—		—		—		—		—		—		—
408		Taxes other than Income Taxes		506,159		400		—		—		—		—		—		—		—
409		Income Taxes		—		—		—		—		—		—		—		—		—
410		Provision for Deferred Income Taxes		—		—		—		—		—		—		—		—		—
411		Provision for Deferred Income Taxes—Credit		—		—		—		—		—		—		—		—		—
411.5		Investment Tax Credit		—		—		—		—		—		—		—		—		—
426.1		Donations		100,464		3,280		—		—		—		2,403		—		—		—
426.2		Life Insurance		126,015		—		—		—		—		—		—		—		—
426.3		Penalties		544		—		—		—		—		—		—		—		—
426.4		Civic, Political & Related Act.		167,316		—		—		—		—		—		350		—		3,626
426.5		Other Deductions		5,878,579		30,621		1,290		—		389		39,654		650		—		21,706
427		Interest on Long Term Debt		—		—		—		—		—		—		—		—		—
430		Interest on Debt to Associate Companies		—		—		—		—		—		—		—		—		—
431		Other Interest Expense		312,870		—		—		—		—		—		—		—		—
588		Misc. Distrib. Exp.		—		—		—		—		—		—		—		—		—
		TOTAL EXPENSE		335,374,413		12,913,285		6,204,728		240,830		1,188,029		117,545,525		1,338,908		6,005,502		1,987,214

24

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ACCT		DESCRIPTION		ENV AFR		REG MKT		DO-RPR NW		DO-ENH NW		DO-AST MG		DO-OP MTN		DO MGMT		FIN PLN BU		ACT/FIN R
901		Supervision		—		—		—		—		—		—		—		—		—
902		Meter Reading		—		—		—		—		—		—		—		—		—
903		Customer Records & Collection Exp.		—		—		—		—		—		—		—		—		—
909		Infor. & Instruc. Adver		—		—		—		—		—		—		—		—		—
912		Gen'l Marketing & Marketing Programs		—		—		—		—		—		—		—		—		—
913		Other Adver—Sales		—		—		—		—		—		—		—		—		—
920		Salaries and Wages		588,633		4,512,248		601		—		1,549,995		761,232		581,452		973,288		2,118,713
921		Office Supplies and Expenses		2,793,814		855,275		34,624		7,016		230,015		32,359		495,925		145,016		147,716
922		Administrative Expenses Transferred—Credit		—		—		—		—		—		—		—		—		—
923		Outside Services Employed		67,300		196,919		—		—		805,814		81,130		192,582		108,189		137,964
924		Property Insurance		—		—		—		—		—		—		—		—		—
925		Injuries and Damages		—		—		—		—		3,665		—		—		—		—
926		Employee Pensions and Benefits		—		—		—		—		—		705		—		—		1,897
928		Regulatory Commission Expenses		—		—		—		—		—		—		—		—		—
930.1		General Advertising Expenses		—		—		—		—		—		—		—		—		—
930.2		Miscellaneous General Expenses		—		2,000		—		—		—		—		—		—		—
931		Rents		—		—		—		—		—		—		—		—		—
932		Maintenance of Structures and Equipment		—		—		—		—		—		—		—		—		—
935		Mtce-Communication EQ		—		—		—		—		—		3,680		—		—		—
401		Operation Expense		—		—		—		—		—		—		—		—		—
403		Depreciation and Amortization Expense		—		—		—		—		—		—		—		—		—
408		Taxes other than Income Taxes		—		—		—		—		—		—		—		—		—
409		Income Taxes		—		—		—		—		—		—		—		—		—
410		Provision for Deferred Income Taxes		—		—		—		—		—		—		—		—		—
411		Provision for Deferred Income Taxes—Credit		—		—		—		—		—		—		—		—		—
411.5		Investment Tax Credit		—		—		—		—		—		—		—		—		—
426.1		Donations		—		—		—		—		632		232		80		—		1,000
426.2		Life Insurance		—		—		—		—		—		—		—		—		—
426.3		Penalties		—		—		—		—		—		—		—		—		—
426.4		Civic, Political & Related Act.		—		—		—		—		—		—		—		—		—
426.5		Other Deductions		1,194		10,158		—		—		40		420		715		119		200
427		Interest on Long Term Debt		—		—		—		—		—		—		—		—		—
430		Interest on Debt to Associate Companies		—		—		—		—		—		—		—		—		—
431		Other Interest Expense		—		—		—		—		—		—		—		—		—
588		Misc. Distrib. Exp.		—		—		—		—		—		—		—		—		—
		TOTAL EXPENSE		3,450,941		5,576,600		35,225		7,016		2,590,161		879,758		1,270,754		1,226,612		2,407,490

25

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ACCT		DESCRIPTION		TRD ENR		PAYROLL		CRP TX		FIN SYS		FIN&CNT A		IT STRT		IT OPER		CSH MGMT		CRP FIN S		INVST/SHR
901		Supervision		—		—		—		—		—		—		(76,342	)	—		—		—
902		Meter Reading		—		—		—		—		—		—		—		—		—		—
903		Customer Records & Collection Exp.		—		—		—		—		—		—		(4,405	)	—		—		—
909		Infor. & Instruc. Adver		—		—		—		—		—		—		—		—		—		—
912		Gen'l Marketing & Marketing Programs		—		—		—		—		—		—		—		—		—		—
913		Other Adver—Sales		—		—		—		—		—		—		—		—		—		—
920		Salaries and Wages		980,705		329,135		679,181		549,155		636,894		1,459,515		18,756,548		139,792		393,301		105
921		Office Supplies and Expenses		257,045		39,229		54,787		399,992		93,452		617,704		18,936,160		986,975		1,246,992		4,106
922		Administrative Expenses Transferred—Credit		—		—		—		—		—		—		—		—		—		—
923		Outside Services Employed		4,102,768		82,800		24,767		—		170,685		219,985		17,498,154		—		431,466		68,830
924		Property Insurance		—		—		—		—		—		—		—		—		—		—
925		Injuries and Damages		—		—		—		—		—		—		(25,598	)	—		—		—
926		Employee Pensions and Benefits		—		—		—		—		—		3,035		(3,486,440	)	—		244		—
928		Regulatory Commission Expenses		—		—		—		—		—		—		—		—		—		—
930.1		General Advertising Expenses		—		—		—		—		—		—		—		—		—		—
930.2		Miscellaneous General Expenses		—		3,478		—		—		—		—		19,383		—		—		—
931		Rents		—		—		—		—		—		—		594		—		—		—
932		Maintenance of Structures and Equipment		—		—		—		—		—		—		—		—		—		—
935		Mtce-Communication EQ		—		—		—		—		—		14,610		(168,634	)	—		—		—
401		Operation Expense		—		—		—		—		—		—		—		—		—		—
403		Depreciation and Amortization Expense		—		—		—		—		—		—		—		—		—		—
408		Taxes other than Income Taxes		—		—		—		—		—		—		(1,158,467	)	—		—		—
409		Income Taxes		—		—		—		—		—		—		—		—		—		—
410		Provision for Deferred Income Taxes		—		—		—		—		—		—		—		—		—		—
411		Provision for Deferred Income Taxes—Credit		—		—		—		—		—		—		—		—		—		—
411.5		Investment Tax Credit		—		—		—		—		—		—		—		—		—		—
426.1		Donations		—		—		—		—		—		—		20		—		—		—
426.2		Life Insurance		—		—		—		—		—		—		—		—		—		—
426.3		Penalties		—		496		—		—		—		—		—		—		—		—
426.4		Civic, Political & Related Act.		—		—		—		—		—		—		2,245		—		—		—
426.5		Other Deductions		—		—		92		44		108		—		326		—		—		—
427		Interest on Long Term Debt		—		—		—		—		—		—		—		—		—		—
430		Interest on Debt to Associate Companies		—		—		—		—		—		—		—		—		—		—
431		Other Interest Expense		—		—		—		—		—		—		—		—		—		—
588		Misc. Distrib. Exp.		—		—		—		—		—		—		(88,520	)	—		—		—
		TOTAL EXPENSE		5,340,518		455,138		758,827		949,191		901,139		2,314,849		50,205,024		1,126,767		2,072,003		73,041

26

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ACCT		DESCRIPTION		RISK MGMT		STRTGC PL		LEGAL		INTRNL CO		BLDG OP MT		SECRTY		DOC SRV		R.O.W.		TRNSPR SR		PRCRMNT
901		Supervision		—		—		—		—		—		—		—		—		—		—
902		Meter Reading		—		—		—		—		—		—		—		—		—		—
903		Customer Records & Collection Exp.		—		—		—		—		—		—		—		—		—		—
909		Infor. & Instruc. Adver		—		—		—		—		—		—		—		—		—		—
912		Gen'l Marketing & Marketing Programs		—		—		—		—		—		—		—		—		—		—
913		Other Adver—Sales		—		—		—		—		—		—		—		—		—		—
920		Salaries and Wages		—		257,835		1,504,242		433,931		596,508		161,972		67,272		124,787		128,658		242,846
921		Office Supplies and Expenses		(598,461	)	14,870		897,426		280,798		5,872,610		180,025		4,564,621		21,113		27,604		56,417
922		Administrative Expenses Transferred—Credit		—		—		—		—		—		—		—		—		—		—
923		Outside Services Employed		258,713		3,553		8,343,048		128,142		4,154,522		1,102,846		1,660,009		68,501		274		609
924		Property Insurance		496		—		—		—		—		—		—		—		—		—
925		Injuries and Damages		6,212		—		5,500		—		4,925		—		—		—		—		—
926		Employee Pensions and Benefits		—		—		—		—		—		1,992		—		—		—		—
928		Regulatory Commission Expenses		—		—		—		—		—		—		—		—		—		—
930.1		General Advertising Expenses		—		—		—		818		—		—		—		—		—		—
930.2		Miscellaneous General Expenses		80,275		900		6,718		—		—		—		—		—		—		—
931		Rents		—		—		—		—		—		—		—		—		—		—
932		Maintenance of Structures and Equipment		—		—		—		—		—		—		—		—		—		—
935		Mtce-Communication EQ		—		—		—		—		20,317		—		—		—		—		—
401		Operation Expense		—		—		—		—		—		—		—		—		—		—
403		Depreciation and Amortization Expense		—		—		—		—		—		—		—		—		—		—
408		Taxes other than Income Taxes		—		—		—		—		—		—		—		—		—		—
409		Income Taxes		—		—		—		—		—		—		—		—		—		—
410		Provision for Deferred Income Taxes		—		—		—		—		—		—		—		—		—		—
411		Provision for Deferred Income Taxes—Credit		—		—		—		—		—		—		—		—		—		—
411.5		Investment Tax Credit		—		—		—		—		—		—		—		—		—		—
426.1		Donations		—		—		—		—		—		—		—		—		—		—
426.2		Life Insurance		—		—		—		—		—		—		—		—		—		—
426.3		Penalties		—		—		—		—		—		—		—		—		—		—
426.4		Civic, Political & Related Act.		—		—		95,942		—		—		—		—		—		—		—
426.5		Other Deductions		—		—		15,583		20,881		(830	)	—		45,019		—		—		—
427		Interest on Long Term Debt		—		—		—		—		—		—		—		—		—		—
430		Interest on Debt to Associate Companies		—		—		—		—		—		—		—		—		—		—
431		Other Interest Expense		—		—		—		—		—		—		—		—		—		—
588		Misc. Distrib. Exp.		—		—		—		—		—		—		—		—		—		—
		TOTAL EXPENSE		(252,765	)	277,158		10,868,459		864,570		10,648,052		1,446,835		6,336,921		214,401		156,536		299,872

27

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ACCT		DESCRIPTION		STRTGC SO		MTRLS LOG		SRC SPPT		CORP HR		TCH&SAF T		INDS RLTN		EXEC MGMT		CORP		EXTERNAL MKTG.
901		Supervision		—		—		—		—		—		—		—		—		—
902		Meter Reading		—		—		—		—		—		—		—		—		—
903		Customer Records & Collection Exp.		—		—		—		—		—		—		—		—		—
909		Infor. & Instruc. Adver		—		—		—		—		—		—		—		—		—
912		Gen'l Marketing & Marketing Programs		—		—		—		—		—		—		—		—		—
913		Other Adver—Sales		—		—		—		—		—		—		—		—		—
920		Salaries and Wages		483,439		290,746		261,011		3,357,705		723,457		59,368		4,091,038		414,675		556,291
921		Office Supplies and Expenses		70,240		61,453		212,871		3,105,058		418,342		30,463		3,560,272		2,787,833		1,778,376
922		Administrative Expenses Transferred—Credit		—		—		—		—		—		—		—		—		—
923		Outside Services Employed		126,057		42,762		62,434		761,984		18,660		211,589		2,217,046		854,466		672,491
924		Property Insurance		—		—		—		—		—		—		—		—		—
925		Injuries and Damages		—		—		—		18,937		16,386		—		134,914		—		—
926		Employee Pensions and Benefits		—		—		—		880,415		1,633		—		—		(3,298,718	)	—
928		Regulatory Commission Expenses		—		—		—		—		—		—		—		—		—
930.1		General Advertising Expenses		—		—		—		—		410		—		—		63		212,189
930.2		Miscellaneous General Expenses		—		—		—		—		—		—		14,500		103,945		—
931		Rents		—		—		—		—		—		—		—		—		—
932		Maintenance of Structures and Equipment		—		—		—		—		—		—		—		—		—
935		Mtce-Communication EQ		—		—		—		—		—		—		—		2,066		—
401		Operation Expense		—		—		—		—		—		—		—		—		—
403		Depreciation and Amortization Expense		—		—		—		—		—		—		—		420,133		—
408		Taxes other than Income Taxes		—		—		—		—		—		—		—		—		—
409		Income Taxes		—		—		—		—		—		—		—		—		—
410		Provision for Deferred Income Taxes		—		—		—		—		—		—		—		—		—
411		Provision for Deferred Income Taxes—Credit		—		—		—		—		—		—		—		—		—
411.5		Investment Tax Credit		—		—		—		—		—		—		—		—		—
426.1		Donations		—		—		—		—		—		—		46,679		17,588		28,550
426.2		Life Insurance		—		—		—		126,015		—		—		—		—		—
426.3		Penalties		—		—		—		—		—		—		—		48		—
426.4		Civic, Political & Related Act.		—		—		—		—		—		—		—		—		—
426.5		Other Deductions		—		—		—		195,119		—		—		260,397		(22,272	)	62,142
427		Interest on Long Term Debt		—		—		—		—		—		—		—		—		—
430		Interest on Debt to Associate Companies		—		—		—		—		—		—		—		—		—
431		Other Interest Expense		—		—		—		312,870		—		—		—		—		—
588		Misc. Distrib. Exp.		—		—		—		—		—		—		65		—		—
		TOTAL EXPENSE		679,736		394,961		536,316		8,758,103		1,178,888		301,420		10,324,911		1,279,827		3,310,039

28

---

ACCT		DESCRIPTION		OVERHEADS
901		Supervision		31,398
902		Meter Reading		—
903		Customer Records & Collection Exp.		4,405
909		Infor. & Instruc. Adver		—
912		Gen'l Marketing & Marketing Programs		—
913		Other Adver—Sales		—
920		Salaries and Wages		17,905,621
921		Office Supplies and Expenses		9,149,036
922		Administrative Expenses Transferred—Credit		—
923		Outside Services Employed		233,633
924		Property Insurance		—
925		Injuries and Damages		36,723
926		Employee Pensions and Benefits		14,145,608
928		Regulatory Commission Expenses		—
930.1		General Advertising Expenses		—
930.2		Miscellaneous General Expenses		(133	)
931		Rents		—
932		Maintenance of Structures and Equipment		—
935		Mtce-Communication EQ		166,159
401		Operation Expense		—
403		Depreciation and Amortization Expense		—
408		Taxes other than Income Taxes		1,664,226
409		Income Taxes		—
410		Provision for Deferred Income Taxes		—
411		Provision for Deferred Income Taxes—Credit		—
411.5		Investment Tax Credit		—
426.1		Donations		—
426.2		Life Insurance		—
426.3		Penalties		—
426.4		Civic, Political & Related Act.		65,153
426.5		Other Deductions		5,194,814
427		Interest on Long Term Debt		—
430		Interest on Debt to Associate Companies		—
431		Other Interest Expense		—
588		Misc. Distrib. Exp.		88,455
		TOTAL EXPENSE		48,685,098

29

---

Departmental Analysis of Salaries—Account 920

				INCLUDED IN AMOUNTS BILLED TO:
		TOTAL AMOUNT		PARENT (LEC)		OTHER ASSOCIATES		NON- ASSOCIATES		NUMBER OF PERSONNEL END OF YEAR
NAME OF DEPT OR SERVICE FUNCTION
Customer Service		6,210,314		—		6,210,314		—		142
Sales & Marketing		4,630,581		—		4,630,581		—		50
Metering		296,394		—		296,394		—		4
Revenue Collection		1,068,368		—		1,068,368		—		21
Power Generation		6,032,097		—		6,032,097		—		84
Fuel Procurement		1,155,396		—		1,155,396		—		13
Transmission		5,478,954		—		5,478,954		—		79
Regulatory Affairs Management		1,122,602		—		1,122,602		—		14
Environmental Affairs Management		778,681		—		778,681		—		10
Regulatory Marketing		6,506,566		—		6,506,566		—		67
Distribution Oper-Repair Network Process		768		—		768		—		—
Distribution Oper-Enhance Network Process		—		—		—		—		—
Distribution Oper-Asset Mgmt		2,012,381		—		2,012,381		—		25
Distribution Oper-Oper & Maintain Network Process		990,875		—		990,875		—		14
Distribution Oper-Management		762,385		—		762,385		—		8
Financial Planning & Budgeting		1,285,515		—		1,285,515		—		16
Accounting & Financial Reporting		2,819,733		—		2,819,733		—		51
Trading Controls/Energy Mktg. Accounting		1,261,079		—		1,261,079		—		19
Payroll		435,422		—		435,422		—		8
Corporate Tax		900,220		—		900,220		—		13
Financial Systems		613,306		—		613,306		—		4
Financial & Contract Auditing		845,219		—		845,219		—		12
IT Tech Strategy, Planning & Security		1,899,778		—		1,899,778		—		25
IT Operations		21,615,671		—		21,615,671		—		198
Cash Mgmt & Investment Services		185,592		—		185,592		—		3
Corporate Finance Services		517,242		—		517,242		—		6
Investor/Shareholder Relation Services		104		—		104		—		—
Risk Management		—		—		—		—		—
Strategic Planning		341,195		—		341,195		—		3
Legal Services		1,973,553		—		1,973,553		—		21
Internal Communications		572,537		—		572,537		—		7
Building Operations & Maintenance Services		785,060		—		785,060		—		12
Security Services		215,068		—		215,068		—		3
Document Services		89,298		—		89,298		—		1
Right Of Way Services		165,641		—		165,641		—		3
Transportation Services		167,549		—		167,549		—		2
Procurement & Major Contracts		320,891		—		320,891		—		2
Strategic Sourcing		640,166		—		640,166		—		8
Materials Logistic		382,442		—		382,442		—		6
Sourcing Support		344,142		—		344,142		—		7
Corporate Human Resources		4,239,012		—		4,239,012		—		52
Technical & Safety Training		952,804		—		952,804		—		14
Industrial Relations Management		78,535		—		78,535		—		2
Executive Management Services		5,118,643		—		5,118,643		—		27
Corporate		414,789		—		414,789		—		—
Government Affairs		—		—		—		—		—
External & Brand Commun.		726,065		—		726,065		—		13
TOTAL		86,952,633		—		86,952,633		—		1,069

30

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Outside Services Employed—Account 923

Instructions:

        Provide a breakdown by subaccount of outside services employed. If the aggregate amounts paid to any one payee and included within one subaccount is less than $25,000, only the aggregate number and amount of all such payments included within the subaccount need be shown. Provide a subtotal for each type of service.

From Whom Purchased		Address		Relationship "A" - Associate "NA" - Non-Associate		Amount
4Sight Corporation		1302 Basswood Ct. Jeffersonville, IN 47130		NA		848,946
ABB		2 Acee Drive Natrona Heights, PA 18974		NA		75,000
Abel Construction Company Inc.		3401 Bashford Ave. Ct. Louisville, KY 40218		NA		440,303
Abell Elevator Intl		1256 Logan St. Louisville, KY 40204		NA		85,219
Access Computer Careers		404 Republic Bldg. Louisville, KY 40202		NA		496,544
Accountants on Call		950 Breckinridge Ln. Louisville, KY 40207		NA		43,425
AETNA Building Maintenance Inc.		525 N. Yellow Springs St. Springfield, OH 45504		NA		51,821
Ajilon LLC		2918 Collections Center Dr. Chicago, IL 60693		NA		348,717
Alstom Power Inc.		P.O. Box 905417 Charlotte, NC 28290-5417		NA		66,468
American Payment Systems Inc.		P.I. Box 5736 Hartford, CT 06102-5736		NA		127,951
Analysts International		22062 Network Pl. Chicago, IL 60673		NA		326,799
Andriot, James E		231 Breckenridge Ln. S202-D Louisville, KY 40207		NA		91,463
Anything Groes Inc.		P.O. Box 305 Buckner, KY 40010		NA		40,293
Aon Consulting Inc.		10451 Mill Run Cr. Owings Mills, MD 21117		NA		72,616
Apar Infotech Corporation		160 Technology Dr. Canonsburg, PA 15317		NA		269,420
Arthur Andersen LLP		P.O. Box 73233 Chicago, IL 60672		NA		130,365

31

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Assured Asset Protection Inc.		8220 Saint Anthony Church Rd. Louisville, KY 40214		NA		102,196
Aubrey Silvey Enterprises Inc.		371 Hamp Jones Rd. Carrollton, GA 30117		NA		33,000
Avaya Inc.		P.O. Box 27-850 Kansas City, MO 64180		NA		290,091
B and B Electric Co., Inc.		1460 Sunshine Ln. Lexington, KY 40505		NA		42,868
Baker Botts LLP		1600 San Jacinto Center 98 San Jacinto Blvd. Austin, TX 78701		NA		38,525
Ball Homes Inc.		P.O. Box 12950 Lexington, KY 40583		NA		81,628
Bank One NA—ProCard		P.O. Box 94596 Louisville, KY 40294		NA		1,051,709
BellSouth Communication Systems		P.O. Box 79045 Baltimore, MD 21279		NA		103,582
Bittners		731 E. Main St. Louisville, KY 40202		NA		225,981
Bloomberg LP		P.O. Box 30244 Hartford, CT 06150		NA		32,119
Boehl Stopher and Graves LLP		400 W. Market St.—S. 2300 Louisville, KY 40202		NA		176,281
Braden, Susan		5900 Jessamine Ln. Louisville, KY 40258		NA		32,560
Brockman, G. Kenneth		10900 Foxgate Ct. Louisville, KY 40223		NA		79,040
Bruce, Dale		3010 Autumn Hills Tr. New albany, IN 47150		NA		49,702
Burns and McDonnell		P.O. Box 411883 Kansas City, MO 64141		NA		140,302
Butler, Nancy Lyons		1201 Navajo Ct. Louisville, KY 40207		NA		49,207
C & I Engineering Inc.		1930 Bishop Ln. S. 800 Louisville, KY 40218-1925		NA		86,261
C & S H Inc.		8601 Chetmer Ln. Louisville, KY 40220		NA		95,203

32

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Carma International Inc.		1023 15th St. NW 7th Floor Washington DC 20005		NA		29,139
Center for Business and Economic Research		335 BA Gatton Business & Economics Bldg. U of K—Lexington, KY 40506		NA		25,400
Century Lighting Service Inc.		3713 Marvin Ave. Louisville, KY 40218		NA		135,075
Charles River Assoc Inc.		D 3139 Boston, MA 02241-3139		NA		1,117,555
Coldiron Veith Construciton Corp		2521 Crusaders Way Lexington, KY 40509		NA		30,873
Comfort Home of Kentucky		780 Eden Rd. Lancaster, PA 17601		NA		69,038
Commercial Furniture Services		1004 Dixon Ave. Louisville, KY 40217		NA		110,817
Commercial Movers Inc.		P.O. Box 710710 Columbus, OH 43271		NA		223,667
Computer Progress United		304 Middletown Pk Pl Suite A Louisville, KY 40243		NA		168,867
Computer Task Group Inc.		P.O. Box 60073 Charlotte, NC 28260		NA		109,716
Computershare Investor Services LLC		33844 Treasury Center Chicago, IL 60694		NA		67,675
Comverge Technologies		4497 Park Dr. Norcross, GA 30093		NA		867,675
Convergent Group Corp.		Dept. 348 Denver, CO 80291-0348		NA		7,577,413
Corpedia Corp.		2020 N. Central Ave. S. 1050 Phoenix, AZ 85004		NA		87,520
Covington & Burling		P.O. Box 7566 Washington, DC 20044		NA		286,350
Creative Alliance		P.O. Box 641266 Cincinnati, OH 45264		NA		204,660
CSC Research Services		P.O. Box 905145 Charlotte, NC 28290		NA		102,066
Cutter Homes		3131 Custer Dr. S. 4 Lexington, KY 40517		NA		41,289

33

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D W Destiny Consulting Inc.		P.O. Box 70398 Louisville, KY 40270		NA		48,378
DB Consulting LLC		3008 Gus Emmett Trail Sellersburg, IN 47172		NA		65,835
Deloitte & Touche LLP		P.O. Box 1613 Stamford, CT 06920		NA		250,000
Design Collaborative Inc.		183 Lazy River N. Pkwy. Shepherdsville, KY 40165		NA		51,163
Dewey Ballantine		1301 Avenue of the Americas New York, NY 10019		NA		194,015
Dewolf Boberg and Associates		100 North Central Expy. S. 210 Richardson, TX 75080		NA		80,000
Dispute Resolution Management Inc.		132 W. Pierpoint Ave. S.400 Salt Lake City, UT 84101		NA		37,637
Diversity Adventures Inc.		104 Ridgeway Ave. Louisville, KY 40207		NA		65,077
Document Control Systems Inc.		1300 S. 4th St. S.150 Louisville, KY 40208		NA		40,876
Donahue, Judith H		310 Clover Ln. Louisville, KY 40207		NA		40,538
Drake Beam Morin Inc.		P.O. Box 100739 Atlanta, GA 30384-0739		NA		186,159
DRI WEFA		P.O. Box 945937 Atlanta, GA 30394-5937		NA		27,900
Duncan Technologies		32441 30th Ave. Stanton, MN 55018		NA		134,619
Dupont Flooring Systems		4790 Crittenden Dr. S. 101 Louisville, KY 40209		NA		55,085
E Max Inc.		2420 Frankfort Ave. Louisville, KY 40206		NA		433,050
Earthwell Energy Management Inc.		P.O. Box 3044 Louisville, KY 40201		NA		511,821
Edison Electric Institute		701 Pennsylvania Ave. NW Washington, DC 20004		NA		29,821
Enertouch Inc.		1959 Parker Cr. Suite E Stone Mountain, GA 30087		NA		983,178
Environmental Care Inc.		3000 W. Magazine St. Louisville, KY 40211		NA		25,323

34

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Environmental Systems Corp.		200 Tech Center Dr. Knoxville, TN 37912		NA		53,450
EON Engineering GMBH		Bermannsgluckstr 41 43 Gelsenkirchen 45898 Germany		A		94,884
Ernst & Young LLP		P.O. Box 828370 Philadelphia, PA 19182-8370		NA		512,775
Evans Aetna Services LLC		4807 Chenoweth Run Rd. Louisville, KY 40299		NA		832,616
Evans Construction Co Inc.		4807 Chenoweth Run Rd. Louisville, KY 40299		NA		56,627
Everest Technologies LLC		12910 Shelbyville Rd. S. 135 Louisville, KY 40243		NA		153,180
Falls City Fence Co.		2201 W. Jefferson Louisville, KY 40212		NA		28,862
Ferreri & Fogle		333 Guthrie Green S. 203 Louisville, KY 40202		NA		35,455
Fisher Controls International Inc.		Dept 73735 Chicago, IL 60673-7736		NA		77,005
Francis, James R.		24521 Morning Glory St. Moreno Valley, CA 92553		NA		113,537
Frost Brown Todd LLC		P.O. Box 70087 Louisville, KY 40270		NA		792,064
GAI Consultants, Inc.		570 Beatty Rd Monroeville, PA 15146		NA		34,207
Gamblin, William W.		528 Ridgewater Ct. Lexington, KY 40515		NA		104,114
Gardere and Wynne LLP		1601 Elm St. S 3000 Dallas, TX 75201		NA		25,908
GE Appliances		GE Appliance Park Louisville, KY 40225		NA		225,106
GE Harris Energy Control Systems Canada Inc.		4525 Manalla Rd. SE Calgary, Alberta, T2G 4B6 Canada		NA		40,122
GE Intl Inc/GE Energy Services		64 Circle Freeway Dr. Cincinnati, OH 45246		NA		42,000
General Electric Company		Power Generation 1 River Road Schenectady, NY 12245		NA		58,934,939
General Electric Industrial Systems		P.O. Box 102827 Atlanta, GA 30368-2827		NA		50,498

35

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Geographic Data Technology Inc.		11 Lafayette St. Lebanon, NH 03766-1445		NA		27,625
Georgia Transmission Corp.		2100 E. Exchange Pl. Tucker, GA 30084-5336		NA		8,763,285
Goldman Sachs & Co.		GPO 9081 Church St. Station New York, NY 10087		NA		54,296
Green Mechanical Construction		P.O. Box 1869 Glasgow, KY 42142-1869		NA		360,920
Greenberg Traurig LLP		885 Third Ave. New York, NY 10022		NA		27,211
Greenebaum Doll & McDonald PLLC		Section 469 Louisville, KY 40289		NA		253,009
H Huff Construction Mgmt Specialists Inc.		1651 Colony Ln. Zachary, LA 70791		NA		392,298
Hall Contracting of Kentucky Inc.		P.O. Box 37270 Louisville, KY 40233-7270		NA		453,290
Harper Ferguson and Davis		1730 Meidinger Tower, 462 S. 4th Ave. Louisville, KY 40202		NA		257,370
Harshaw Trane Service		1800 Plantside Dr. Louisville, KY 40299-1975		NA		572,399
Helicopter Minit Men Inc.		P.O. Box 21758 Columbus, OH 43221		NA		38,292
Hewett, Robert M.		4812 Waterside Dr. Lexington, KY 40513		NA		34,350
Highland Roofing Co., Inc.		4007 Produce Rd. Louisville, KY 40218		NA		304,592
Hill and Associates Inc.		222 Severn Ave. Anapolis, MD 21403		NA		49,275
Hodgson Russ Attorneys LLP		One M & T Plaza S. 2000 Buffalo, NY 14203-2391		NA		30,848
Holub, Patricia		7305 Fox Bluff Pl. Prospect, KY 40059		NA		34,293
Honeywell DMC Services Inc.		Stonehill Corp Center, 999 Broadway Saugus, MA 01906		NA		803,703
Honeywell Inc.		1550 Ormsby Station Rd. Louisville, KY 40223-4019		NA		59,811

36

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Hope Duggan and Silva		Miami Commercial Center 8307 NW 68th St. S. 1218 P.O. Box 025743 Miami, FL 33102		NA		241,862
Hunton & Williams		1900 K Street NW Washington, DC 20006		NA		187,918
ICR		P.O. Box 1050 Moorestown, NJ 08057		NA		725,686
Industrial Electrical Contractors		P.O. Box 51566 Bowling Green, KY 42102		NA		27,335
Innovative Controls Engineering Inc.		3000 Lightheart Rd. Louisville, KY 40222		NA		146,756
Intecom Inc		106 E. Broadway Louisville, KY 40202		NA		64,401
Iron Mountain		4111 Leghorn Dr. Louisville, KY 40218		NA		55,599
Irvin H. Whitehouse & Sons Co.		P.O. Box 32870 Louisville, KY 40232		NA		88,913
J Laurie Commercial Floors Inc.		1828 South Anthony Blvd. Fort Wayne, IN 46803		NA		27,582
Jarboe		21 E. High St. Mooresville, IN 46158		NA		103,365
JC Graphics LLC		7006 Echo Tr. Louisville, KY 40299		NA		59,021
JD Power and Assoc.		30401 Agoura Rd. Agoura Hills, CA 91301		NA		120,000
Johnson Controls Inc.		1808 Cargo Cr. Louisville, KY 40299		NA		125,707
Jones Day Reavis & Pogue		77 West Wacker Chicago, IL 60601		NA		497,775
Kforce.Com		4965 U.S. Hwy 42 S.2900 Louisville, KY 40222		NA		754,041
Kirkpatrick, AA		601 Rothbury Ln. Louisville, KY 40243		NA		131,219
Koinonia Computing Inc.		200 S. 5th St. STE 201 S Louisville, KY 40202		NA		447,892
Lakeshore Financial Staffing		33112 Treasury Center Chicago, IL 60694		NA		218,226

37

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Lewis & Corrigan PLLC		P.O. Box 5711 Louisville, KY 40255		NA		25,350
LG&E Power Operations Inc.		220 W. Main St. Louisville, KY 40202		A		107,589
Long, Gregory Keith		1704 Traveller Rd. Lexington, KY 40504		NA		28,555
Louisville Career Placement		3418 Frankfort Ave. S. 165 Louisville, KY 40207		NA		40,985
Lyon, Robert E.		2018 Tyler Ln. Louisville, KY 40205		NA		80,768
M S Gerber & Associates Inc.		1357 West Lane Ave. Columbus, OH 43221		NA		47,483
M Taylor Construction Co. Inc.		387 Waco Dr. Sandersville, GA 31082		NA		124,025
Majestic Systems Integration Co.		103 Powell Ct. S. 150 Brentwood, TN 37027		NA		31,976
Marine Electric Co Inc.		110 S. First St. Louisville, KY 40202		NA		57,889
Markel, Charles A.		2544 Woodbourne Ave. Louisville, KY 40205		NA		46,220
Matrix Integration LLC		417 Main St. Jasper, IN 47546		NA		138,997
MO Better Marketing Communications		605 W. Main St. Louisville, KY 40202		NA		80,000
Moodys Investor Service		P.O. Box 102597 Atlanta, GA 30368		NA		201,500
Morgan Stanley and Company Inc.		1585 Broadway New York, NY 10036		NA		4,054,590
Murray Guard Inc.		P.O. Box 30171 Nashville, TN 37241		NA		227,130
Mustang Engineering Inc.		P.O. Box 201829 Houston, TX 77216		NA		181,708
National Environmental Contracting Inc.		2660 Technology Dr. Louisville, KY 40299		NA		55,710
Neace Lukens Inc.		211 Browns Ln. Louisville, KY 40207		NA		245,145
Neal, Susan S.		1120 Carlimar Ln. Louisville, KY 40222		NA		56,775

38

---

Netjets Aviation Inc.		4111 Bridleway Ave. Columbus, OH 43219		NA		77,161
New Age Technologies Inc.		819 W. Main St. S. 200 Louisville, KY 40202		NA		110,112
New Energy Associates LLC		P.O. Box 116022 Atlanta, GA 03068-6022		NA		42,617
Nixon Peabody LLP		One Thomas Circle, Suite 700 Washington, DC 20005		NA		204,201
Occupational Physician Services of Louisville		901 W. Broadway Louisville, KY 40202		NA		41,445
Off Duty Police Services Inc.		13418 Forest Springs Dr. Louisville, KY 40245-2076		NA		31,148
Ogden Newell and Welch		1700 Citizens Plaza Louisville, KY 40202		NA		744,249
Open Systems International Inc.		3600 Holly Ln. N. S 40 Minneapolis, MN 55447-1283		NA		83,350
OPS Plus Inc		2950 Breckenridge Ln. S. 9A Louisville, KY 40220		NA		477,447
Overland Contracting Inc.		P.O. Box 801103 Kansas City, MO 64180-1103		NA		36,879,329
PDE, PLLC		4024 Lilydale Ct. Lexington, KY 40516		NA		95,134
Pike Electric Inc.		P.O. Box 868 Mount Airy, NC 27030		NA		40,531
Pink Elephant Inc.		5575 N. Service Rd. Burlington, ON, L7L 6M1, Canada		NA		388,977
Piper Marbury Rudnick & Wolfe LLP		1251 Avenue of the Americas New York, NY 10020-1104		NA		82,536
Platts		3333 Walnut St. Boulder, CO 80301		NA		89,120
Pomeroy Computer Resources Inc.		908 Dupont Rd. Louisville, KY 40207		NA		263,059
Porter, Janice W.		5902 Croft Ct. Louisville, KY 40207-1728		NA		41,209
Powell Goldstein Frazer & Murphy LLP		191 Peachtree St. NE, 16th FL Atlanta, GA 30303		NA		922,601
Power Technology		Westwood Way Westwood Business Park Coventry CV4 8L6		A		615,765

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Powergen UK Plc		Westwood Way Westwood Business Park Coventry CV4 8L6		A		117,507
Pricewaterhouse Coopers LLP		P.O. Box 651376 Charlotte, NC 28265		NA		632,370
Pro Turf Inc.		2007 Browns Village Rd. Jeffersontown, KY 40299		NA		43,980
Professional Health Services Inc.		83 South Eagle Rd. Havertown, PA 19083		NA		43,484
Purvis, Marybeth		1048 Deer Crossing Way Lexington, KY 40509		NA		31,061
Rapidigm Inc.		8790 Governor's Hill Dr. S. 204 Cincinnati, OH 45249		NA		320,140
Reid, Terese M.		5621 Fox Horn Dr. Apt 206 Louisville, KY 40216		NA		63,840
RHI Management Resources		P.O. Box 6248 Carol Stream, IL 60197		NA		69,886
Riptech, Inc.		2800 Eisenhower Ave. Alexandria, VA 22314		NA		123,000
Risk Management Services Corp		211 Browns Ln. Louisville, KY 40207		NA		26,027
Riverside Parking Inc.		702 W. Market Louisville, KY 40202		NA		80,500
Ryan, Patrick S.		2295 Wolfpen Rd. Sulphur, KY 40070		NA		73,683
Sandersville Well Co.		P.O. Box 811 Sandersville, GA 31082		NA		109,658
Sargent and Lundy LLC		135 S. LaSalle St. Dept 2901 Chicago, IL 60674-2901		NA		373,916
SBC Data Com Inc.		1835 Shackleford Ct. S. 200 Norcross, GA 30093		NA		33,001
Schlumberger/Sema		7127 Mexico Rd. PMB 289 St. Peters, MO 63376		NA		2,607,293
Schnell Contractors Inc.		1343 Tile Factory Ln. Louisville, KY 40213		NA		304,490
Siebel Systems Inc.		2207 Bridgepoint Pky San Mateo, CA 94404		NA		135,213
Soft Link Solutions Inc.		2375 Ariel St. N Maplewood, MN 55109		NA		79,429

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Standard and Poors Corp		P.O. Box 80-2542 Chicago, IL 60680		NA		147,400
Stoll Keenon and Park LLP		201 E. Main St. S. 1000 Lexington, KY 40507		NA		360,035
Stoner Associates		P.O. Box 7777-W5015 Philadelphia, PA 19175		NA		55,638
Summit Blue Consulting		1722 14th St. S 230 Boulder, CO 80302		NA		303,541
Summit Manufacturing LLC		225 Kiwanis Blvd. W. Hazleton, PA 18201		NA		32,715
Sunland Construction, Inc.		P.O. Box 972824 Dallas, TX 75397-2824		NA		618,714
Sutherland Asbill and Brennan LLP		999 Peachtree St. NE Atlanta, GA 30309		NA		1,075,709
Synergics Energy Services LLC		191 Main St. Annapolis, MD 21401		NA		49,917
Tamaqua Cable Products		One Tamaqua Blvd. P.O. Box 347 Schuykill, PA 17972		NA		28,115
Technology Consulting Inc.		140 Whittington Pky Louisville, KY 40222		NA		83,875
Tek Systems		9420 Bunsen Pkwy S. 220 Louisville, KY 40220		NA		381,977
Texas Gas Transmission		3800 Frederica St. Owensboro, KY 42302		NA		160,175
The Legacy Energy Group LLC		32 Waterloo St. Warrenton, VA 20186		NA		26,061
The Prime Group LLC		P.O. Box 7469 Louisville, KY 40257		NA		205,009
Thermal Equipment Sales Inc.		P.O. Box 8430 Lexington, KY 40533-8430		NA		70,723
Tiffany Alley & Associates		400 Perimeter Ctr. Terrace S. 900 Atlanta, GA 30346		NA		32,285
Todays Staffing Inc.		P.O. Box 910270 Dallas, TX 75391		NA		1,055,806
TP Technologies		4130 Outer Loop Louisville, KY 40219		NA		44,047
Tripp, Warren D		2406 Willowbrook Ct. Prospect, KY 40059		NA		28,660

41

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Troutman Sanders LLP		600 Peachtree Street NE S. 5200 Atlanta, GA 30308-2216		NA		588,227
Tuck Engineering Inc.		P.O. Box 760 Big Stone Gap, VA 24219		NA		28,700
Turner & Davis		P.O. Box 2796 Midland, TX 79702		NA		427,091
Unisys Pulsepoint Communications		6307 Carpinteria Ave. Carpinteria, CA 93013		NA		34,042
United Electric Co. Inc.		4333 Robards Ln. Louisville, KY 40218		NA		38,214
United Mail		4410 Bishop Ln. Louisville, KY 40218		NA		151,297
US Inspection Services		502 W. Crescentville Rd. Cincinnati, OH 45246		NA		59,441
Utility Services & Automation		909 E. Loudan Ave. S. 2 Lexington, KY 40505		NA		25,950
Vantage Consulting Inc.		22814 Overseas Hwy. Cudjoe Key, FL 33042		NA		46,767
Vector ESP Inc.		10641 Techwoods Circle Cincinnati, OH 45242-2846		NA		36,074
Vulcan Fire Systems Inc.		3330 Gilmore Industrial Blvd. Louisville, KY 40213-2190		NA		28,467
W R Cole and Assoicates Inc.		11300 Decimal Dr. Louisville, KY 40269		NA		167,360
Wallace Company Inc.		P.O. Box 19825 Louisville, KY 40259		NA		745,294
Waste Management of KY		2673 Outer Loop Louisville, KY 40219		NA		53,628
Wayne Corp.		Medical Arts Bldg. 1169 Eastern Pkwy S. 1166 Louisville, KY 40217		NA		74,559
Willhite, Ronald L.		7375 Wolf Spring Trace Louisville, KY 40241		NA		75,981
William M. Mercer Inc.		1500 Meidinger Tower Louisville, KY 40294		NA		154,542
Winston and Strawn		200 Park Ave. New York, NY 10166-4193		NA		84,000
World Arts Inc.		P.O. Box 597 Spencer, IN 47460		NA		41,700

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Wright & Talisman PC		1200 G. Street NW Suite 600 Washington, DC 20005-3802		NA		43,321
Wyatt Tarrant & Combs LLP		PNC Plaza Louisville, KY 40202		NA		117,565
Xerox		9000 Wessex PL S. 100 Louisville, KY 40222		NA		1,570,146
YCA		2336 Wisteria Dr. S. 440 Snellville, GA 30078		NA		91,915
All Others (904)				NA		3,025,879
		TOTAL ALL				164,289,815

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Employee Pensions and Benefits—Account 926

Instructions:

        Provide a listing of each pension plan and benefit program provided by the service company. Such listing should be limited to $25,000.

General Advertising Expenses—Account 930.1

Instruction:

        Provide a listing of the amount included in Account 930.1, "General Advertising Expenses," classifying the items according to the nature of the advertising and as defined in the account definition. If a particular class includes an amount in excess of $3,000 applicable to a single payee, show separately the name of the payee and the aggregate amount applicable thereto.

Miscellaneous General Expenses—Account 930.2

Instruction:

        Provide a listing of the amount included in Account 930.2, "Miscellaneous General Expenses," classifying such expenses according to their nature. Payments and expenses permitted by

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Section 321(b)(2) of the Federal Election Campaign Act, as amended by Public Law 94-283 in 1976 (2 U.S.C. SS441(b)(2)) shall be separately classified.

Description						DIRECT COSTS CHARGED
930201—Misc. Corporate Exp.
		Executive Mgmt Exp.—Telecom		18,324
		Business License Fees		232		18,556
930202—Association Dues				74,669		74,669
930203—Research Work
		EPRI DUES		175,446		175,446
930207—Other Misc. Gen Exp.
		Charges to LG&E Energy Corp.
		Relocation Taxes		124,279		124,279
		Charges to LG&E Capital Corp.
		Risk Management Insurance		2,400
		Salary and Wages		7,258
		Parking Fees		1,440
		OverAccrual of Costs to Achieve		-88,659
		Misc.		2,317		-75,244
		Charges to LG&E Enertech Inc.
		Phone		31,868
		Advertising		4,665
		Postage		1,476
		Misc.		14,662
		Employee Expenses		103,324
		Dues		3,524
		Insurance		8,101		167,620
		Charges to LG&E Home Services Inc.
		Misc. Employee Expenses		188		188
930209—Nondeductible Penalties				2,870		2,870
930222—E.ON Merger Expense
		Various		7,153		7,153
930250—Broker Fees
		Neace Lukens		77,875		77,875
TOTAL				573,412		573,412

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Rents—Account 931

Instruction:

        Provide a listing of the amount included in Account 931, "Rents," classifying such expenses by major groupings of property, as defined in the account definition of the Uniform System of Accounts.

Taxes Other Than Income Taxes—Account 408

Instructions:

        Provide an analysis of Account 408, "Taxes Other Than Income Taxes." Separate the analysis into two groups: (1) Other than U.S. Government taxes, and (2) U.S. Government taxes. Specify each of the various kinds of taxes and show the amounts thereof. Provide a subtotal for each class of tax.

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Donations—Account 426.1

Instructions:

        Provide a listing of the amount included in Account 426.1, "Donations," classifying such expenses by its purpose. The aggregate number and amount of all items of less than $3,000 may be in lieu of details.

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Other Deductions—Account 426.5

Instructions:

        Provide a listing of the amount included in Account 426.5, "Other Deductions," classifying such expenses according to their nature.

Description		Name of Payee		Amount
426501—Other Deductions
Outside Services		Various		12,354
Legal Outside Services		Various		1,314
Sales and Promotion Expense		Various		8,420
Insurance Fees		Various		182,038
Ex-Pat Expenses		Various		60,339
Labor/Burdens		Various		13,167
Pension		Various		18,619
Dues and Subscriptions		Various		23,849
Contributions		Various		28,708
Lease/Rental		Various		89,118
Employee Meals/Travel Expenses/Telecom		Various		108,489
Miscellaneous		Various		150,140
				696,555
426502, 426592—SERP (Direct and Indirect) Officers Supplemental Early Retirement Program		Various		2,447,825
426504, 426594—Officers' TIA (Direct and Indirect) Officers Team Incentive Award		Various		2,362,428
426505, 426595—Off Long-Term Incent (Direct and Indirect) Officers Long-Term Incentives		Various		371,742
426510—Powergen Costs Powergen Costs		Various		29
		TOTAL 426.5		5,878,579

Schedule XVIII—Notes to Statement of Income

        See Notes to Financial Statements on pages 18-19.

Schedule XIX—Financial Data

        If, at the time an annual report on this form is filed, the registrant is required to submit this report and any amendments thereto electronically via EDGAR, the registrant shall furnish a Financial

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Data Schedule. The Schedule shall set forth the financial and other data specified below that are applicable to the registrant on a consolidated basis.

Item No.		Caption Heading		Amount
1		Net Service Company Property		3,444,076
2		Total Investments		—
3		Total Current and Accrued Assets		72,431,194
4		Total Deferred Debits		6,152,410
5		Balancing Amount for total Assets and Other Debits		—
6		Total Assets and Other Debits		82,027,680
7		Total Proprietary Capital		(7,250,111	)
8		Total Long-Term Debt		—
9		Notes Payable		—
10		Notes Payable to Associate Companies		—
11		Other Current and Accrued Liabilities		103,196,571
12		Total Deferred Credits		—
13		Accumulated Deferred Income Taxes		—
14		Total Liabilities and Proprietary Capital		82,027,680
15		Services Rendered to Associate Companies		335,374,413
16		Services Rendered to Non-associate Companies		—
17		Miscellaneous Income or Loss		—
18		Total Income		335,374,413
19		Salaries and Wages		86,952,633
20		Employee Pensions and Benefits		8,250,371
21		Other Expenses		240,171,409
22		Total Expenses		335,374,413
23		Net Income (Loss)		—
24		Total Expenses (Direct Costs)		327,382,475
25		Total Expenses (Indirect Costs)		7,991,938
26		Total Expenses (Total)		335,374,413
27		Number of Personnel End of Year		1,069

Organization Chart

Victor A. Staffieri			Chairman, Chief Executive Officer and President
	John R. McCall			Vice President and Secretary
	Richard Aitken-Davies			Vice President and CFO
		S. Bradford Rives			Vice President and Controller
		Daniel K. Arbough			Treasurer

METHODS OF ALLOCATION

        Information Systems Chargeback Rates—Rates for services, including but not limited to software, consulting, mainframe and personal computer services, are based on the costs of labor, materials and information services overheads related to the provision of each service. Such rates are applied based on the specific equipment employed and the measured usage of services by Client entities. These rates will be determined annually based on actual experience and may be adjusted for any known and reasonably quantifiable events, or at such time as may be required due to significant changes.

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        Number of Customers Ratio—A ratio based on the number of retail electric and/or gas customers. This ratio will be determined annually based on the actual number of customers at the end of the previous calendar year and may be adjusted for any known and reasonably quantifiable events, or at such time as may be required due to significant changes. In some cases, the ratio may be calculated based on the type of customer class being served (i.e. Residential, Commercial or Industrial).

        Number of Employees Ratio—A ratio based on the number of employees benefiting from the performance of a service. This ratio will be determined annually based on actual counts of applicable employees at the end of the previous calendar year and may be adjusted for any known and reasonably quantifiable events, or at such time as may be required due to significant changes. In some cases, a two-step assignment methodology is utilized to properly allocate SERVCO employee costs to the proper legal entity.

        Departmental Charge Ratio—A specific SERVCO department ratio based upon various factors such as labor hours, labor dollars, departmental or Client entity headcount, etc. The departmental charge ratio typically applies to indirectly attributable costs (defined in Section V, Cost Apportionment Methodology) such as departmental administrative, support, and/or material and supply costs that benefit more than one affiliate and that require allocation using general measures of cost causation. Methods for assignment are department-specific depending on the type of product or service being performed and are documented and monitored by the PUHCA Compliance Manager on a monthly basis to ensure consistent and proper application and periodic true-up, where necessary, for SERVCO billing purposes.

        Electric Peak Load Ratio—Based on the sum of the monthly electric maximum system demands for the immediately preceding twelve consecutive calendar months, the numerator of which is for an operating company and the denominator of which is for all operating companies. This ratio will be determined annually, or at such time as may be required due to a significant change.

        Revenue Ratio—Based on the sum of the revenue at the end of each month for the immediately preceding twelve consecutive calendar months, the numerator of which is for an operating company or an affected affiliate company and the denominator of which is for all operating companies and affected affiliate companies. This ratio will be determined annually, or at such time as may be required due to significant changes.

        Payroll Ratio—Based on the sum of the payroll at the end of each month for the immediately preceding twelve consecutive calendar months, the numerator of which is for an operating company or an affected affiliate company and the denominator of which is for all operating companies and affected affiliate companies. This ratio will be determined annually, or at such time as may be required due to significant changes.

        Total Assets Ratio—Based on the total assets at year end for the preceding year, the numerator of which is for an operating company or affected affiliate company and the denominator of which is for all operating companies and affected affiliate companies. This ratio will be determined annually, or at such time as may be required due to significant changes. In the event of joint ownership of a specific asset, asset ownership percentages will be utilized to assign costs.

        Contract Ratio—Based on the sum of the physical amount (i.e. tons of coal, cubic feet of natural gas) of the contract for both coal and natural gas at the end of each month for the immediately preceding twelve consecutive calendar months, the numerator of which is for an operating company or an affected affiliate company and the denominator of which is for all operating companies and affected affiliate companies. This ratio will be determined annually, or at such time as may be required due to significant changes.

        Shareholder Ratio—Based on the average number of preferred shareholders at the end of each month for the immediately preceding twelve consecutive calendar months, the numerator of which is

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for an operating company or an affected affiliate company and the denominator of which is for all operating companies and affected affiliate companies. This ratio will be determined on an annual basis, or at such time as may be required due to significant changes.

        Number of Meters Ratio—Ratio based on the number or types of meters being utilized by all levels of customer classes within the system for the immediately preceding twelve consecutive calendar months. The numerator is equal to the number of meters for a specific Client entity and the denominator is equal to such expenditures for all applicable client entities. This ratio will be determined annually, or at such time as may be required due to significant change.

        Number of Transactions Ratio—Based on the sum of transactions occurring in the immediately preceding twelve consecutive calendar months, the numerator of which is for an operating company or an affected would affiliate company and the denominator of which is for all operating companies and affected affiliate companies. This ratio will be determined on a monthly basis, or at such time as may be required due to significant changes. For example, services with regard to Procurement and Major Contracts define a transaction as the number of contracts negotiated. Services pertaining to Materials Logistics would define the transaction as the number of items ordered, picked and disbursed out of the warehouse. Services pertaining to Accounts Payable would define the transaction as the number of invoices processed. Similar to the Departmental Charge Ratio, defined previously, the PUHCA Compliance Manager is responsible for maintaining and monitoring specific product/service methodology documentation and periodic true-up requirements for actual transactions related to SERVCO billings.

        Retail Revenue Ratio—Based on utility revenues, excluding energy marketing revenues, for the immediate preceding twelve consecutive calendar months, the numerator of which is for an operating company or an affiliate and the denominator of which is for all operating companies and affected affiliate companies. This ratio will be determined annually, or at such time as may be required due to a significant change.

        Energy Marketing Ratio—Based on the absolute value of equivalent megawatt hours purchased or sold for the immediate preceding twelve consecutive calendar months, the numerator of which is for an operating company or an affiliate and the denominator of which is for all operating companies and affected affiliate companies. This ratio will be determined annually, or at such time as may be required due to a significant change.

        Regulatory Mandate Ratios—Based on Federal or state mandated percentage allocations based on regulatory proceedings and requirements. These ratios are typically developed in concert with regulatory authorities representing the results of merger or joint asset ownership negotiations and are supported by specific contracts regarding legal entity allocation requirements. Contract terms and periodic updates, if necessary, are maintained and monitored by the PUHCA Compliance Manager and SERVCO departmental management.

        Project Ratio—Based on the total costs for any departmental or affiliate project at the end of each month for the immediately preceding twelve consecutive calendar months, the numerator of which is for an operating company or an affected affiliate company and the denominator of which is for all operating companies and affected affiliate companies. This ratio will be determined on a monthly basis, or at such time as may be required due to significant changes.

        Transportation Resource Management System Chargeback Rate—Rates for use of transportation equipment are based on the costs associated with providing and operating transportation fleet for all affiliated companies including developing fleet policy, administering regulatory compliance programs, managing repair and maintenance of vehicles and procuring vehicles. Such rates are applied based on the specific equipment employment and the measured usage of services by Client entities. These rates

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will be determined annually based on actual experience and may be adjusted for any known and reasonably quantifiable events, or at such time as may be required due to significant changes.

        Non-Fuel Material and Services Expenditures—A ratio based on non-fuel material and services expenditures, net of reimbursements, for the immediately preceding twelve consecutive calendar months. The numerator is equal to such expenditures for a specific Client entity and/or line-of-business as appropriate and the denominator is equal to such expenditures for all applicable Client entities. This ratio will be determined annually, or at such time as may be required due to a significant change.

Annual Statement of Compensation for Use of Capital Billed

        Not Applicable

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Signature Clause

        Pursuant to the requirements of the Public Utility Holding Company Act of 1935 and the rules and regulations of the Securities and Exchange Commission issued thereunder, the undersigned company has duly caused this report to be signed on its behalf by the undersigned officer thereunto duly authorized.

		LG&E ENERGY SERVICES INC. . (Name of Reporting Company)
		By:	/s/  S. BRADFORD RIVES       (Signature of Signing Officer) S. Bradford Rives Vice President and Controller (Printed Name and title of Signing Officer)

Date: April 30, 2003

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Supplemental—Service Transactions among the E.ON System and LG&E Energy Group

Instructions:

        As stated in the merger order.

        Services rendered by members of the E.ON Group or the Powergen Group companies included the assessment of environmental control options for coal-fired plants, key design of replacement boiler pressure components for coal plant, specialist analysis of combustion turbine component failures, plant modeling and operational impact assessment of flue gas desulphurization retrofits on coal plant, analysis and resolution of plant operational, performance, availability and reliability issues for coal plant and combustion turbines, plant maintenance strategy development for coal boilers and combustion turbines, specialist non destructive evaluation of coal boiler condition, and training in assessing and preventing boiler tube failures at the LG&E Energy Group Plant facilities. In addition, several E.ON/Powergen employees are assigned to work in the US for the LG&E Energy Group. These salaries and expenses of the ex-patriot employees are reimbursed to E.ON/Powergen. Individual job descriptions are listed below.

        Services rendered by individual LG&E Energy Group companies were mainly labor and general expenses of individuals doing specialized work for the E.ON/Powergen system companies. This work included regulatory filings, engineering policy, Information Technology Integration and Investment/Shareholder expenses. Also, several employees were assigned to work in UK at Powergen and in Germany at E.ON. Those salaries and expenses were reimbursed by Powergen and E.ON. Several items were expenses of Powergen and E.ON and were paid by the LG&E Energy Group companies, with reimbursement from Powergen and E.ON. Descriptions are on each line item below.

									LG&E Energy Group Employees Performing Service
Description of Services					Service Performed By:		Service Received By:
		Amount							Absolute		Percentage
LG&E Energy Provision of PowerTube		$	3,000		Power Technology		Louisville Gas & Electric Co.
EW Brown Unit 1 Combustion Trials		$	39,420		Power Technology		Kentucky Utilities Company
Ghent Units 3&4—Reheater Design		$	226,580		Power Technology		Kentucky Utilities Company
LIPA Published Data Review		$	4,480		Power Technology		LG&E Power Development
Airborne Technology Assessment		$	19,756		Power Technology		LG&E Energy Group
Trimble County—Performance Acceptance Test		$	25,750		Power Technology		Louisville Gas & Electric Co.
EW Brown Unit 7 Technical Assessment		$	14,547		Power Technology		Kentucky Utilities Company
Coleman—FGD Booster Fan Philisophy		$	2,960		Power Technology		Western Kentucky Energy
Coleman—Plume Grounding		$	6,000		Power Technology		Western Kentucky Energy
Brown 2 Tender Assessment		$	797		Power Technology		Kentucky Utilities Company
Brown—GT24 Blade Assessment		$	76,447		Power Technology		Kentucky Utilities Company
Coleman—Furnace Protection Study		$	45,950		Power Technology		Western Kentucky Energy
EW Brown 11N2 Maintenance Strategy		$	18,431		Power Technology		Kentucky Utilities Company
Flow Model of Henderson Precipitators		$	21,000		Power Technology		Western Kentucky Energy
Green River 3 Generator		$	12,887		Power Technology		Kentucky Utilities Company
EW Brown GT24 Vane Assessment		$	57,230		Power Technology		Kentucky Utilities Company
Mill Creek Air Preheater		$	14,560		Power Technology		Louisville Gas & Electric Co.
Ghent Reheater Creep Analysis		$	1,740		Power Technology		Kentucky Utilities Company
Coleman Furnace Negative Pressure		$	11,410		Power Technology		Western Kentucky Energy
Trimble County Monitoring Specification		$	3,000		Power Technology		Louisville Gas & Electric Co.
Cane Run LP Blade Root Failure Examination		$	6,635		Power Technology		Louisville Gas & Electric Co.

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EW Brown CT7 Inspection/Assessment		$	2,100		Power Technology		Kentucky Utilities Company
Trimble 2 Heat Rate Review		$	3,090		Power Technology		Louisville Gas & Electric Co.
LG&E Boiler Maintenance Strategies		$	42,793		Power Technology		Louisville Gas & Electric Co.
Henderson Superheater Creep Life		$	2,667		Power Technology		Western Kentucky Energy
Coleman U2 Exciter Vibration		$	3,980		Power Technology		Western Kentucky Energy
Mill Creek Unit 4 Combustion Advice		$	560		Power Technology		Louisville Gas & Electric Co.
Cane Run RTS Vibration Monitoring		$	4,840		Power Technology		Louisville Gas & Electric Co.
Coleman FGD Ductwork and Dampers		$	4,790		Power Technology		Western Kentucky Energy
Trimble County Part Load Performance Test		$	21,525		Power Technology		Louisville Gas & Electric Co.
GHPS: Ghent U3 Rehtr/econ elements		$	12,685		Power Technology		Kentucky Utilities Company
Trimble Platen Outlet header Redesign		$	23,903		Power Technology		Louisville Gas & Electric Co.
Ghent HP Turbine Modification		$	12,180		Power Technology		Kentucky Utilities Company
LG&E Further Boiler Maintenance Strategies		$	18,792		Power Technology		Louisville Gas & Electric Co.
LG&E Energy Legal Support		$	22,544		Power Technology		LG&E Energy Group
Mill Creek Burner Tuning		$	12,826		Power Technology		Louisville Gas & Electric Co.
EW Brown Inspection Supervision and Audit		$	8,205		Power Technology		Kentucky Utilities Company
Trimble County Superheater Creep Life		$	6,306		Power Technology		Louisville Gas & Electric Co.
Boiler Tube Failure Training Course		$	9,320		Power Technology		Louisville Gas & Electric Co. Kentucky Utilities Company
Trimble Acceptance Tests		$	94,884		E.ON Engineering		Louisville Gas & Electric Co.
Seminar IMD 2002		$	4,862		E.ON AG		LG&E Energy Group
Seminar—Leading Corporate Transformation		$	11,063		E.ON AG		LG&E Energy Group
Bank Fees		$	5,719		E.ON NA		LG&E Capital Corp.
Ex-Patriot Salaries and Expenses—Engineering		$ $ $ $ $ $ $ $	194,155.30 174,588 869,266 54,381 156,084 6,646 112,062 127,215		Powergen plc Powergen plc Powergen plc Powergen plc Powergen plc Powergen plc Powergen plc Powergen plc		Louisville Gas and Electric Company Kentucky Utilities Company LG&E Capital Corp. LG&E Power Development Inc. (Fairfax) LG&E Power Development Inc. (Tiger Creek) Powergen plc LG&E Power Inc. Western Kentucky Energy Corp.
Ex-Patriot Salaries and Expenses—Human Resources		$ $ $ $ $ $ $ $ $	107,004 106,309 54,968 2,803 7,741 15,282 110 2,313 548		Powergen plc Powergen plc Powergen plc Powergen plc Powergen plc Powergen plc Powergen plc Powergen plc Powergen plc		Louisville Gas and Electric Company Kentucky Utilities Company LG&E Capital Corp. LG&E Enertech Inc. LG&E Power Inc. Western Kentucky Energy Corp. LG&E Power Development Inc. (Fairfax) LG&E Power Development Inc. (Tiger Creek) LG&E Energy Marketing Inc.

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Ex-Patriot Salaries and Expenses—Accounting/Finance		$ $ $ $	102,864 97,928 321,099 5,955		Powergen plc Powergen plc Powergen plc Powergen plc		Louisville Gas and Electric Company Kentucky Utilities Company LG&E Capital Corp. LG&E Energy Marketing Inc.
Ex-Patriot Salaries and Expenses—Transition		$ $ $	58,150 51,360 175,188		Powergen plc Powergen plc Powergen plc		Louisville Gas and Electric Company Kentucky Utilities Company LG&E Capital Corp.
Ex-Patriot Salaries and Expenses—OPC		$ $	159,379 18,557		Powergen plc Powergen plc		LG&E Energy Marketing Inc. LG&E Capital Corp.
Ex-Patriot Salaries and Expenses—Trading Controls		$	34,102		E.ON AG		LG&E Capital Corp.
Power Plant Management (Ex-Pat Assignment)		$	165,442		LG&E Energy Services Inc.		Powergen plc		1		0.02	%
Legal		$	61,700		LG&E Energy Services Inc.		Powergen plc		11		0.26	%
Corporate Communications (Ex-Pat assignment)		$	144,630		LG&E Energy Services Inc.		Powergen plc		1		0.02	%
Engineering Policy-Group Engineering		$	325,608		LG&E Energy Services Inc.		Powergen plc		1		0.02	%
IT Integration		$	53,563		LG&E Energy Services Inc.		Powergen plc		2		0.05	%
Dir. Chain & Operating Services (Ex-Pat assignment)		$	399,522		LG&E Energy Services Inc.		Powergen plc		1		0.02	%
Legal (Ex-Pat Assignment)		$	94,892		LG&E Energy Services Inc.		Powergen plc		1		0.02	%
Legal (Transition Director)		$	643,976		LG&E Energy Services Inc.		Powergen plc		1		0.02	%
Investment/Shareholder Relations (Expenses Paid by LG&E Services for Powergen plc—Computershare)		$	71,930		LG&E Energy Services Inc.		Powergen plc
Legal (Expenses Paid by LG&E Services for Powergen plc)		$	320,980		LG&E Energy Services Inc.		Powergen plc
Procurement—License Fees and Marketsite Subscription (Expenses Paid by LG&E Services for Powergen plc)		$	14,160		LG&E Energy Services Inc.		Powergen plc
Miscellaneous—Travel Exp. of Powergen employees while in US (Expenses Paid by LG&E Services for Powergen plc)		$	1,296		LG&E Energy Services Inc.		Powergen plc
2002 EPRI Payment (Expenses Paid by LG&E Services for Powergen plc)		$	320,980		LG&E Energy Services Inc.		Powergen plc
Funding of Mobile Computing and Multimedia Research (Expenses Paid by LG&E Services for Powergen plc)		$	148,000		LG&E Energy Services Inc.		Powergen plc

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IT Video Conferencing (Expenses Paid by LG&E Services for Powergen plc)		$	54,105		LG&E Energy Services Inc.		Powergen plc
Corporate Communications		$	67,044		LG&E Energy Services Inc.		E.ON AG		1		0.02	%
Information Technology		$	50,205		LG&E Energy Services Inc.		E.ON AG		4		0.10	%
Human Resources (Expenses Paid by LG&E Services for E.ON AG)		$	22,019		LG&E Energy Services Inc.		E.ON AG		5		0.12	%
Miscellaneous—Expenses of E.ON Employee stationed in Louisville—Expenses Paid by LG&E Services for E.ON AG		$	12,364		LG&E Energy Services Inc.		E.ON AG
Human Resources (Ex-Pat Assignment)		$	64,895		LG&E Energy Services Inc.		E.ON AG		1		0.02	%
Miscellaneous—Travel Exp. of E.ON employees while in US (Expenses Paid by LG&E Services for E.ON AG)		$	111		LG&E Energy Services Inc.		E.ON AG
Miscellaneous—Special Award/Promotion (Expenses Paid by LG&E Services for E.ON AG)		$	17,639		LG&E Energy Services Inc.		E.ON AG
Corporate Communications		$	9,475		LG&E Energy Services Inc.		E.ON NA		1		0.02	%
Information Technology		$	5,200		LG&E Energy Services Inc.		E.ON NA		6		0.14	%
Legal Services		$	2,100		LG&E Energy Services Inc.		E.ON NA		1		0.02	%
Facilities/Operation Services		$	1,317		LG&E Energy Services Inc.		E.ON NA		1		0.02	%
Miscellaneous—Glenview House (Expenses Paid by LG&E Services for E.ON NA)		$	290,295		LG&E Energy Services Inc.		E.ON NA
Total LG&E Group Employees engaged in rendering services:									39		1.09	%

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LISTING OF SCHEDULES AND ANALYSIS OF ACCOUNTS
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ANNUAL REPORT TO THE SEC OF LG&E ENERGY SERVICES INC. – For the Year Ended December 31, 2002