SECURITIES AND EXCHANGE COMMISSION
                                 WASHINGTON, DC 20549
                                      FORM 10-Q


                   X   QUARTERLY REPORT PURSUANT TO SECTION 13 or 15(d)
                       OF THE SECURITIES EXCHANGE ACT OF 1934

                       For the quarterly period ended  SeptemberJune 30, 19941995

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

                       For the transition period from            to



                            Commission file number 1-3464


                               Kentucky Utilities Company
                (Exact name of registrant as specified in its charter)


           Kentucky and Virginia                                61-0247570
         (State or other jurisdiction of                    (I.R.S. Employer
          incorporation or organization)                   Identification No.)


        One Quality Street, Lexington, Kentucky                       40507
        (Address of principal executive offices)                    (Zip Code)


        Registrant's telephone number, including area code        606-255-2100


                                    Not Applicable
        Former name, former address  and former fiscal year, if  changed since
        last report



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


            Number of shares  of Common Stock  outstanding at NovemberAugust 9,  1994:1995:
        37,817,878 shares (owned by the parent-KU Energy Corporation).



                                         -1-

                            PART I.  FINANCIAL INFORMATION
                              KENTUCKY UTILITIES COMPANY
                                 STATEMENTS OF INCOME
                                     (Unaudited)
                              (in thousands of dollars)

                                                             For the Three
                                                             Months Ended
                                                               SeptemberJune 30,
                                                            1995       1994       1993


        Operating Revenues (See Note 3)                   $156,512  $160,6152)                   $154,757  $154,026

        Operating Expenses:
          Fuel, principally coal, used in
             generation (See Note 3)                  33,972    44,8602)                        40,679    43,372
          Electric power purchased                          15,603    10,68917,631    16,356
          Other operating expenses                          27,939    27,12030,127    27,645
          Maintenance                                       15,209    12,75519,493    18,893
          Depreciation                                      16,308    15,19118,785    16,151
          Federal and state income taxes                     14,208    15,9435,634     7,933
          Other taxes                                        3,536     3,4174,125     3,642

               Total Operating Expenses                    126,775   129,975136,474   133,992

        Net Operating Income                                29,737    30,64018,283    20,034

        Other Income and Deductions:
          Interest and dividend income                         771       827803       766
          Other income and deductions - net                  1,719     1,3121,376     1,875

               Total Other Income and Deductions             2,490     2,1392,179     2,641

        Income Before Interest Charges                      32,227    32,77920,462    22,675

        Interest Charges                                     8,585     7,9899,901     8,202

        Net Income                                          23,642    24,79010,561    14,473

        Preferred Stock Dividend Requirements                  564       629564

        Net Income Applicable to Common Stock             $  23,0789,997  $ 24,16113,909







          The accompanying  Notes to  Financial Statements are  an integral
          part of these statements.
                                         -2-

                              KENTUCKY UTILITIES COMPANY
                                 STATEMENTS OF INCOME
                                     (Unaudited)
                              (in thousands of dollars)

                                                             For the NineSix
                                                             Months Ended
                                                               SeptemberJune 30,
                                                            1995       1994       1993


        Operating Revenues (See Note 3)                   $477,066  $454,7602)                   $321,905  $320,554

        Operating Expenses:
          Fuel, principally coal, used in
             generation (See Note 3)                 121,203   132,3852)                        86,385    87,231
          Electric power purchased                          47,842    26,12833,408    32,239
          Other operating expenses                          82,271    77,68860,725    54,332
          Maintenance                                       48,640    39,21634,349    33,431
          Depreciation                                      48,646    45,60637,486    32,338
          Federal and state income taxes                    36,872    39,09116,268    22,664
          Other taxes                                        11,241    10,6428,439     7,705

               Total Operating Expenses                    396,715   370,756277,060   269,940

        Net Operating Income                                80,351    84,00444,845    50,614

        Other Income and Deductions:
          Interest and dividend income                       3,273     2,3591,436     2,502
          Other income and deductions - net                  4,767     4,5132,856     3,048

               Total Other Income and Deductions             8,040     6,8724,292     5,550

        Income Before Interest Charges                      88,391    90,87649,137    56,164

        Interest Charges                                    24,932    25,11619,648    16,347

        Net Income                                          63,459    65,76029,489    39,817

        Preferred Stock Dividend Requirements                1,820     1,8881,128     1,256

        Net Income Applicable to Common Stock             $ 61,63928,361  $ 63,87238,561







          The accompanying  Notes to  Financial Statements are  an integral
          part of these statements.
                                         -3-

                              KENTUCKY UTILITIES COMPANY
                               STATEMENTS OF CASH FLOWS
                                     (Unaudited)
                              (in thousands of dollars)

                                                           For the NineSix Months
                                                             Ended SeptemberJune 30,
                                                            1995      1994      1993
        Cash Flows from Operating Activities:

          Net Income                                      $ 63,45929,489  $ 65,76139,817
          Items not requiring (providing) cash currently:
            Depreciation                                    48,646    45,60637,486    32,338
            Deferred income taxes and investment tax credit (4,768)    1,939(1,097)   (3,342)
            Changes in current assets and liabilities:
              Change in fuel inventory                      (2,968)    3,853(2,199)      179
              Change in accounts receivable                  (1,651)  (10,192)2,957     2,059
              Change in accounts payable                   623     4,722(11,075)   (3,195)
              Change in accrued taxes                        3,648     5,8694,737     2,998
              Change in accrued utility revenues              4,964     3,037
            Change in liability to ratepayers              (28,704)   34,889
            Change in escrow funds                          29,582   (38,001)(628)    1,865
            Other--net                                       3,665    10,0671,201    (2,393)

        Net Cash Provided by Operating Activities           116,496   127,55060,871    70,326

        Cash Flows from Investing Activities:

          Construction expenditures - utility              (130,035) (104,932)
          Nonutility property                                 (237)   (4,955)(54,480)  (89,468)
          Other                                                 337       12417       170

        Cash Used by Investing Activities                  (129,935) (109,763)(54,463)  (89,298)

        Cash Flows from Financing Activities:

          Short-term borrowings - net                      59,100         -(31,300)   47,900
          Issuance of long-term debt                        50,000         -   123,500
          Funds deposited with trustee - net                 8,600    18,393         -
          Retirement of long-term debt                         including premiums     (21)      (180,677)(21)
          Retirement of preferred stock, including premium       -   (20,302)        -
          Payment of dividends                             (48,114)  (47,270)(32,706)  (32,139)

        Net Cash Provided (Used) by Financing Activities    9,056  (104,447)(5,427)   13,831

        Net DecreaseIncrease (Decrease) in Cash and Cash Equivalents   (4,383)  (86,660)981    (5,141)

        Cash and Cash Equivalents Beginning of Period        3,111     8,832    94,299

        Cash and Cash Equivalents End of Period           $  4,4494,092  $  7,6393,691

        Supplemental Disclosures
          Cash paid for:
            Interest on short and long-term debt          $ 20,06318,622  $ 24,76715,378
            Federal and state income taxes                $ 38,41412,826  $ 33,14825,378



          The accompanying  Notes to  Financial Statements are  an integral
          part of these statements.
                                         -4-


                             KENTUCKY UTILITIES COMPANY
                                    BALANCE SHEETS
                                     (Unaudited)
                              (in thousands of dollars)

                                                         As of       As of
                                                        Sept.June 30,    Dec. 31,
                                                          1995        1994        1993
        ASSETS
        Utility Plant:
          Plant in service, at cost                    $2,079,701  $2,004,688$2,286,014  $2,238,926
          Less: Accumulated depreciation                  925,102     879,960
                                                        1,154,599   1,124,728970,974     933,394
                                                        1,315,040   1,305,532
          Construction work in progress                   209,325     158,829
                                                        1,363,924   1,283,557112,268     104,385
                                                        1,427,308   1,409,917
        Current Assets:
          Cash and cash equivalents                         4,449       8,8324,092       3,111
          Escrow funds - coal contract litigation           8,170      37,7526,594       6,911
          Construction funds held by trustee               2      18,26810,108      18,553
          Accounts receivable                              43,108      41,45738,755      41,712
          Accrued utility revenues                         20,611      25,57524,855      24,227
          Fuel, principally coal, at average cost          34,041      31,07337,851      35,652
          Materials and supplies, at average cost          18,649      17,26122,123      20,081
          Other                                            7,584       7,804
                                                          136,614     188,02213,818      10,616
                                                          158,196     160,863
        Investments, Deferred Charges and Other Assets:
          Accumulated deferred income taxes                42,162      35,778
          Unamortized loss on reacquired debt              12,578      13,29511,814      12,324
          Other                                            36,387      38,400
                                                           91,127      87,47335,006      34,996
                                                           46,820      47,320
               Total Assets                            $1,591,665  $1,559,052$1,632,324  $1,618,100

        CAPITALIZATION AND LIABILITIES
        Capitalization:
          Common stock equity                          $  567,123561,984  $  552,106565,201
          Preferred stock                                  40,000      40,000
          Long-term debt                                  442,015     442,045
                                                        1,049,138   1,034,151545,984     496,012
                                                        1,147,968   1,101,213
        Current Liabilities:
          Preferred stock and long-termLong-term debt due within one year                   21          20,02121
          Short-term borrowings                            59,100           -45,000      76,300
          Accounts payable                                 44,629      44,00638,442      49,517
          Accrued interest                                  9,993       7,3027,499       7,328
          Accrued taxes                                    8,308       4,66014,159       9,422
          Customers' deposits                               6,284      10,8036,535       6,423
          Accrued payroll and vacations                     10,075       7,7099,194       8,207
          Liab. to ratepayers - coal contract litigation    8,163      36,8676,595       6,909
          Other                                             7,148       6,434
                                                          153,721     137,8026,317       6,275
                                                          133,762     170,402
        Deferred Credits and Other Liabilities:
          Accumulated deferred income taxes               254,593     248,103216,893     214,892
          Accumulated deferred investment tax credits      39,302      42,38536,227      38,275
          Regulatory liabilities                           65,946      69,689tax liability                         59,482      60,788
          Other                                            28,965      26,922
                                                          388,806     387,09937,992      32,530
                                                          350,594     346,485
               Total Capitalization and Liabilities    $1,591,665  $1,559,052$1,632,324  $1,618,100


          The accompanying  Notes to  Financial Statements are  an integral
          part of these statements.
                                         -5-


                              KENTUCKY UTILITIES COMPANY
                            NOTES TO FINANCIAL STATEMENTS
                                     (Unaudited)


          1.  PRESENTATION OF CONDENSED INFORMATION

              Pursuant to the rules  and regulations of the  Securities and

          Exchange Commission,  certain information has been  condensed and

          certain footnote disclosures have been omitted, which are normal-

          ly included  in financial statements prepared  in accordance with

          generally accepted accounting principles.

              These financial  statements  should  be read  in  conjunction

          with the financial statements and  notes thereto in the  Kentucky

          Utili-tiesUtilities Company  (Kentucky Utilities)(KU) Annual Report  on Form 10-

          K10-K for  the year

          ended December 31, 1993.1994 (1994 10K).

              In  the  opinion  of management,  the  information  furnished

          herein reflects  all adjustments  which are necessary  to present

          fairly the results of the periods shown and the disclosures which

          have  been made are adequate to make the information not mislead-

          ing.   Results of interim periods  are not necessarily indicative

          of results for any twelve-month period due to the seasonal nature

          of Kentucky Utilities'KU's business.

          2.  PREFERRED STOCK

              Kentucky Utilities  issued  $20 million  of  6.53%  preferred

          stock  in December 1993.  On February 1, 1994, Kentucky Utilities

          used the proceeds from this  issue, together with other available

          funds,  to redeem  its 7.84% Preferred  Stock at a  total cost of

          $20.3 million  (including a  redemption premium  of $.3 million).

          Kentucky  Utilities  announced  its   intention  to  redeem  this

          preferred stock on December 22, 1993.




                                         -6-





                              KENTUCKY UTILITIES COMPANY
                            NOTES TO FINANCIAL STATEMENTS
                                     (Unaudited)


          3.  OPERATING REVENUES AND FUEL COSTS

              Pursuant to  regulatory orders,  Kentucky  UtilitiesKU has  been refunding  fuel

          cost savings  related  to  the  resolution  of  a  coal  contract

          dispute.  Refunds to Kentucky  retail customers commenced in July

          1994.   Refunds were made to Virginia retail customers during the

          period  August  1993 through  June 1994.    Refunds were  made to

          wholesale customers under the  jurisdiction of the Federal Energy

          Regulatory Commission in lump sum payments in September 1993.



                                         Operating  revenues  and  fuel  expense  for  the  respective

          periods  were reduced by the following amounts resulting from the

          above- mentioned refunds:

                              Three Months Ended        Nine Months Ended
                                   Sept. 30,               Sept. 30,

                                1994        1993        1994         1993

                                        (in thousands of dollars)

           Reductions in:

           Operating
            Revenues          $17,540      $4,312      $18,442      $4,312
           Fuel, principally
            coal, used in
            generation        $18,614      $5,098      $21,980      $5,098



              The difference  between the reduction  in Operating  Revenues

          and the  reduction  in Fuel  Expense  is attributed  to  incurred

          litigation costs, fuel costs  savings related to off-system sales

          and costs incurred  to administer the refund plan.  These amounts

          were allowed  to be  retained by  Kentucky Utilities  pursuant to



                                         -7--6-


                              KENTUCKY UTILITIES COMPANY
                            NOTES TO FINANCIAL STATEMENTS
                                     (Unaudited)


              Operating revenues  for the three-month and six-month periods

          ended June 30, 1994 were  reduced by $.4 million and $.9 million,

          respectively,  resulting from  the above-mentioned  refund.   The

          refund  also  resulted in  a reduction  of  fuel expense  for the

          three-month  and  six-month   periods  ended  June 30,  1994   of

          $.4 million  and  $3.4 million,  respectively.    The  difference

          between the reduction  in operating revenues and the reduction in

          fuel expense is attributed to incurred litigation  costs and fuel

          costs savings  related to off-system  sales.  These  amounts were

          allowed to be retained by KU pursuant to regulatory orders.

          LIQUIDITY & RESOURCES

              Kentucky  Utilities'3.  FINANCING

              In  June  1995,  KU  issued  $50 million  of  Series R  First

          Mortgage Bonds  which will mature June 1, 2025  and bear interest

          at 7.55%.  The  proceeds were used primarily to  refinance short-

          term  indebtedness  incurred   to  finance  ongoing  construction

          expenditures increased

          approximately  $26  million  for  the   nine-month  period  ended

          September 30,  1994 compared  to the  same period  of 1993.   The

          increase is primarily attributable to expenditures for compliance

          with the 1990 Clean Air Act Amendments.

              Kentucky Utilities plans  to issue $54 million  of tax-exempt

          debt  during the 4th quarter of  1994 to fund certain solid waste

          disposal facilities' expenditures.



          RESULTS OF OPERATIONS

          Quarter ended September 30, 1994, compared
          to the Quarter ended September 30, 1993


                                                 Increase (Decrease)
                                                    From Prior Year
                                                    Three Months
                                                 Ended Sept. 30, 1994
                                                 kWh        Revenues
                                                 (%)         (000's)

          Residential                             (9)       $ (3,017)
          Commercial                              (1)            489
          Industrial                               9           3,114
          Mine Power & Public Authorities          6           1,718
              Total Retail Sales                   -           2,304
          Other Electric Utilities                59           7,403
          Miscellaneous Revenues & Other           -            (582)
              Total Before Refund                  9           9,125
          Provision for Refund -
            Litigation Settlement                  -         (13,228)
              Total                                9        $ (4,103)





                                         -8-





                              KENTUCKY UTILITIES COMPANY
                       MANAGEMENTS' DISCUSSION AND ANALYSIS OF
                    FINANCIAL CONDITION AND RESULTS OF OPERATIONS


              Operating revenues were  impacted by refunds to  customers of

          fuel  cost  savings associated  with  the  resolution  of a  coal

          contract  dispute.   Refer to  Note 3  of the Notes  to Financial

          Statements for  further discussion.   Operating  revenues, before

          the impact  of the refunds  to customers, increased  $9.1 million

          (6%)  primarily as  a result  of a  9% increase  in kilowatt-hour

          sales.    The  increase   in  kilowatt-hour  sales  is  primarily

          attributable  to  increases in  industrial  and off-system  sales

          partially  offset by  a  decrease  in  residential  sales.    The

          increase in  industrial sales reflects the  continued improvement

          of the manufacturing segment of  the service area.  About  40% of

          the  increase  in industrial  sales is  due  to greater  sales to

          Toyota   Motor  Manufacturing  U.S.A.,   Inc.    (TMM),  Kentucky

          Utilities'  largest  customer.   TMM  completed  an $800  million

          assembly plant expansion  in March  1994.  The  increase in  off-

          system sales is attributable  to an increase in demand  for power

          at  neighboring utilities.    The decrease  in residential  sales

          resulted  from  the mild  weather  experienced  during the  third

          quarter of 1994.

              Fuel expense  was also impacted  by the previously  mentioned

          refunds to customers.  Refer to  Note 3 of the Notes to Financial

          Statements for  further discussion.  Fuel  expense, excluding the

          effect of the refunds to  customers, increased $2.6 million (5%).

          This increase reflects a 4% increase in tons of coal consumed and

          a  1% increase  in the  average price  per ton of  coal consumed.

          Purchased  power expense increased  by $4.9 million  (46%) due to


                                         -9-





                              KENTUCKY UTILITIES COMPANY
                       MANAGEMENTS' DISCUSSION AND ANALYSIS OF
                    FINANCIAL CONDITION AND RESULTS OF OPERATIONS

          higher  demand costs  ($3.6  million)  and greater  kilowatt-hour

          purchases ($1.3  million).    The  increase in  demand  costs  is

          primarily due to the  permanent increase in capacity entitlement,

          effective  January 1994, from  Electric Energy, Inc.  (EEI).  The

          increased  kilowatt-hour purchases  were primarily  from EEI.   A

          contract  between Kentucky  Utilities  and  EEI  allows  Kentucky

          Utilities to purchase, on an economic basis, 20% of the available

          capacity from a 1,000-megawatt generating station owned by EEI.

              Maintenance expenses  increased $2.5 million (19%), primarily

          due to the timing of scheduled maintenance at Kentucky Utilities'

          generating stations.



          Nine Months ended September 30, 1994, compared
          to the Nine Months ended September 30, 1993



                                                 Increase (Decrease)
                                                    From Prior Year
                                                     Nine Months
                                                 Ended Sept. 30, 1994
                                                 kWh        Revenues
                                                 (%)         (000's)

          Residential                              2        $  4,790
          Commercial                               3           3,698
          Industrial                               8           6,591
          Mine Power & Public Authorities          5           3,170
              Total Retail Sales                   4          18,249
          Other Electric Utilities                52          17,890
          Miscellaneous Revenues & Other           -             297
              Total Before Refund                 11          36,436
          Provision for Refund -
            Litigation Settlement                  -         (14,130)
              Total                               11        $ 22,306







                                         -10-





                              KENTUCKY UTILITIES COMPANY
                       MANAGEMENTS' DISCUSSION AND ANALYSIS OF
                    FINANCIAL CONDITION AND RESULTS OF OPERATIONS



              Operating revenues were  impacted by refunds to  customers of

          fuel  cost  savings associated  with  the  resolution of  a  coal

          contract dispute.   Refer  to Note  3 of  the Notes  to Financial

          Statements for  further discussion.   Operating  revenues, before

          the impact of the refunds  to customers, increased $36.4  million

          (8%)  primarily as a result  of an 11%  increase in kilowatt-hour

          sales.    The  increase  in  kilowatt-hour  sales  is   primarily

          attributable to increases in residential,  commercial, industrial

          and off-system sales.  The  increase in industrial sales reflects

          the  continued improvement  of the  manufacturing segment  of the

          service area.   About 40% of the increase in  industrial sales is

          attributable  to greater  sales to  TMM due  its to  recent plant

          expansion.   The increase in  off-system sales is attributable to

          an  increase in demand for  power due to  maintenance programs at

          neighboring  utilities  and to  warm  weather  during the  second

          quarter of 1994.

              Fuel  expense was also  impacted by  the previously mentioned

          refunds to customers.  Refer to  Note 3 of the Notes to Financial

          Statements for  further discussion.  Fuel  expense, excluding the

          effect of the refunds to  customers, increased $5.7 million (4%).

          This increase reflects a 3% increase in the average price per ton

          of coal consumed and a 1% increase in the tons  of coal consumed.

          Purchased power  expense increased  $21.7  million (83%)  due  to

          higher demand costs  ($10 million) and  to greater  kilowatt-hour

          purchases  ($11.7  million).   The  increase in  demand  costs is

                                         -11-





                              KENTUCKY UTILITIES COMPANY
                       MANAGEMENTS' DISCUSSION AND ANALYSIS OF
                    FINANCIAL CONDITION AND RESULTS OF OPERATIONS

          primarily due to the permanent increase in capacity  entitlement,

          effective January 1994,  from EEI.   The increased  kilowatt-hour

          purchases were primarily from EEI.

              Maintenance  expenses increased  $9.4  million  (24%).    The

          increase is  the result of distribution  utility line maintenance

          costs incurred as a  result of extensive ice storm  damage during

          the first quarter  of 1994, as  well as  the timing of  scheduled

          maintenance at Kentucky Utilities' generating stations.





































                                         -12-





                             PART II.  OTHER INFORMATION

                              KENTUCKY UTILITIES COMPANY



          ITEM 1.  LEGAL PROCEEDINGS



             By  order  ofgeneral corporate requirements.

          4.  ENVIRONMENTAL COST RECOVERY

              In July  19, 1994,  the Kentucky  Public Service Commission  (PSC)

          approved   Kentucky   Utilities'   plan   forKU's   January  1994   application  to   implement  an

          environmental surcharge   adjustments   to  customer   billings

          beginning  in August  1994.surcharge.  The surcharge, authorized by a Kentucky

          statute enacted in 1992, is designed to recover certain ongoing operating

          and capital costs  not already  included  in

          existing rates,  related to compliance  with federal, state  or

          local  environmental requirements associated  with the production

          of energy from coal, including the 1990 Clean Air Act Amendments.

          Surcharge billings are subject to periodic PSCKU's environmental  surcharge was implemented in  August 1994 and

          is described in  Item 1 of the 1994  10K.  The initial  six-month


                                         -7-


                              KENTUCKY UTILITIES COMPANY
                            NOTES TO FINANCIAL STATEMENTS
                                     (Unaudited)


          review to confirm

          the leveland hearing process was completed  in June of environmental expenditures1995, and to reconcile previous

          surcharge billings with actual costs.

             Two requests  for rehearing  were filed  by interveners  beforeKU

          is  awaiting an  order  from the  PSC.   The  typical  customer's

          monthly  bill during  the  six-month review  period increased  by

          about 2% as a result of the surcharge.

              The constitutionality of the surcharge  was challenged in the

          Franklin County  (Kentucky) Circuit  Court (Circuit Court)  in an

          action brought against KU and the PSC denied those requests for rehearings.

             On September 9, 1994,by  the Attorney General of

          the CommonwealthKentucky and representatives of Kentucky  (Attorney General) filed  an action incustomer  groups.  In July  1995,

          the Franklin

          County (KY)    Circuit    Court    challengingentered   judgment    upholding    the

          constitutionality of the Kentuckysurcharge but vacating  that part of the

          PSC  order   allowing  KU   to  recover  costs   associated  with

          environmental expenditures  incurred before January 1,  1993, the

          effective date of the surcharge statute, and seekingremanding to vacatethe PSC

          for  determination in accordance with the judgment.  On August 7,

          1995, KU filed a motion requesting the Circuit Court to amend its

          judgment  and sustain  the PSC  order  of July  19, 1994  onin its  entirety.   If the

          ground,  among others,  thatjudgment is ultimately upheld as entered, KU estimates the environmental surcharge approved by the PSC will deprive Kentucky

          Utilities'  customers of  their property  without due  process of

          law.   Management  believes  that, based  on  its review  of  the

          circumstances, the surcharge statute is constitutional andamount

          it is

                                         -13-





          probable  that  the  PSC order  of  July 19,  1994 approving  the

          surcharge  willwould  be upheld.   In the  remote occurrence  that the

          statute is declared  unconstitutional, amounts collected pursuantrequired to the PSC order may be subject to refund.

             By motion filed November 8, 1994,  the Attorney General and two

          interveners are seeking to  haverefund for surcharge collections deposited

          with the court pendingthrough

          June  1995 would be approximately  $4 million.  At  this time, KU

          cannot predict the outcome of this proceeding.





                                         -8-

                              KENTUCKY UTILITIES COMPANY
                       MANAGEMENTS' DISCUSSION AND ANALYSIS OF
                    FINANCIAL CONDITION AND RESULTS OF OPERATIONS

          LIQUIDITY & RESOURCES

              KU's   construction  expenditures   decreased   approximately

          $35 million during  the  litigation.six-month period  ending  June 30,  1995

          compared  to  the  same   period  of  1994.    The   decrease  is

          attributable  primarily to planned reductions in expenditures for

          combustion turbine peaking units and for compliance with the 1990

          Clean Air Act Amendments.

              Refer to  Note 3 of the  Notes to Financial  Statements for a

          discussion of KU's financing activities.

          RESULTS OF OPERATIONS

          Quarter ended June 30, 1995, compared
          to the Quarter ended June 30, 1994

               Net Income  applicable to  common stock  for the  three-month

          period  ended   June 30,   1995  was   $10 million  compared   to

          $13.9 million for the corresponding period of 1994.  The decrease

          reflects milder weather and a decline in off-system  sales during

          the second quarter of 1995 compared to 1994 as well as  increases

          in interest, depreciation and other operating expenses as further

          discussed below.










                                         -9-

                              KENTUCKY UTILITIES COMPANY
                       MANAGEMENTS' DISCUSSION AND ANALYSIS OF
                    FINANCIAL CONDITION AND RESULTS OF OPERATIONS



                                                 Increase (Decrease)
                                                    From Prior Year
                                                    Three Months
                                                 Ended June 30, 1995
                                                 kWh        Revenues
                                                 (%)         (000's)

          Residential                             (2)       $    639
          Commercial                               1           1,376
          Industrial                               5           2,209
          Mine Power & Public Authorities         (1)            580
              Total Retail Sales                   1           4,804
          Other Electric Utilities               (25)         (5,007)
          Miscellaneous Revenues & Other           -             569
               Total Before Refund                (5)            366
          Provision for Refund -
            Litigation Settlement                  -             365
              Total                               (5)       $    731


              Operating  revenues, before  the  impact  of the  refunds  to

          customers during 1994, increased $.4 million. (Refer to Note 2 of

          the Notes  to Financial Statements, "Operating  Revenues and Fuel

          Costs", for a  discussion of the  refunds to customers  resulting

          from the resolution of a coal contract dispute and  the impact on

          1994 operating results). A 5% decrease in kilowatt-hour sales was

          offset   by  $4.3 million   recovered  under   the  environmental

          surcharge.    (Refer   to  Note 4  of  the   Notes  to  Financial

          Statements,  Environmental   Cost  Recovery,  for  an  update  of

          environmental  surcharge legal  proceedings.)    The decrease  in

          kilowatt-hour sales  is attributable to a  decline in residential

          and  off-system  sales,  partially   offset  by  an  increase  in

          industrial  sales.   The  increase in  industrial sales  reflects

          continued  economic growth  in the  manufacturing sector  of KU's

          service area.  About 35% of the industrial sales increase was due

          to     greater    sales    to    Toyota    Motor    Manufacturing

                                         -10-

                              KENTUCKY UTILITIES COMPANY
                       MANAGEMENTS' DISCUSSION AND ANALYSIS OF
                    FINANCIAL CONDITION AND RESULTS OF OPERATIONS

          U.S.A., Inc. (TMM), KU's largest customer.   The decrease in off-

          system sales is attributable to a decrease in demand for power at

          neighboring utilities.  The decline in residential sales reflects

          milder weather  during  the second  quarter of  1995 compared  to

          1994.  However, KU set an all-time peak demand for electricity on

          July 14, 1995 of 3,250 megawatts.

              Fuel  expense,  excluding  the  effect   of  the  refunds  to

          customers, decreased $3.1 million (7%).  This decrease reflects a

          3% decrease in  tons of coal consumed as well as a 4% decrease in

          the  average price  per ton  of coal  consumed.   Purchased power

          expense increased  $1.3 million (8%)  due to increases  in demand

          ($1 million)  and energy costs ($.3 million).    A  6% decline in

          kilowatt-hour purchases, resulting from the  previously mentioned

          decline  in kilowatt-hour  sales,  was offset  by less  favorable

          pricing.

              Other operating expenses  increased by $2.5 million (9%)  due

          to  increased  generating  plant operations  expenses  (primarily

          attributable  to costs associated with environmental compliance),

          advertising  and  marketing   program  expenses  and   timing  of

          administrative and general expenditures.

              Depreciation  expense increased  $2.6 million (16%) resulting

          from the Ghent Unit 1 scrubber and two combustion turbine peaking

          units being placed into service late in 1994 and early 1995.

              Interest charges  increased $1.7 million (21%) reflecting the

          issuance of $54 million  of long-term debt in the  fourth quarter

          of 1994 and an increase in  the average amount of short-term debt

          outstanding compared to the corresponding quarter of 1994.

                                         -11-

                              KENTUCKY UTILITIES COMPANY
                       MANAGEMENTS' DISCUSSION AND ANALYSIS OF
                    FINANCIAL CONDITION AND RESULTS OF OPERATIONS

              Federal   and   state   operating   income  taxes   decreased

          $2.3 million  (29%), primarily due to lower pre-tax income.

































                                         -12-

                              KENTUCKY UTILITIES COMPANY
                       MANAGEMENTS' DISCUSSION AND ANALYSIS OF
                    FINANCIAL CONDITION AND RESULTS OF OPERATIONS

          Six Months ended June 30, 1995, compared
          to the Six Months ended June 30, 1994

              Net  income applicable  to  common  stock for  the  six-month

          period  ended  June 30, 1995  was  $28.4 million  as compared  to

          $38.6 million for the corresponding period of 1994.  The decrease

          reflects milder weather and a  decline in off-system sales during

          the six-month period ending June 30, 1995 as compared to the same

          period in 1994 as well as increases in interest, depreciation and

          other operating expenses as further discussed below.   Net income

          applicable to common stock for the first quarter of 1994 included

          a one-time recovery of about $1.9 million  from the resolution of

          a coal  contract dispute.  For  additional information concerning

          the  refunds resulting  from resolution  of the  dispute and  the

          impact on 1994 operating results, refer to Note 2 of the Notes to

          Financial Statements, "Operating Revenues and Fuel Costs."

                                                 Increase (Decrease)
                                                    From Prior Year
                                                      Six Months
                                                 Ended June 30, 1995
                                                 kWh        Revenues
                                                 (%)         (000's)

          Residential                             (4)        $  (616)
          Commercial                               -           2,436
          Industrial                               5           4,508
          Mine Power & Public Authorities         (2)          1,246
              Total Retail Sales                  (1)          7,574
          Other Electric Utilities               (23)         (7,484)
          Miscellaneous Revenues & Other           -             359
               Total Before Refund                (5)            449
          Provision for Refund -
            Litigation Settlement                  -             902
              Total                               (5)       $  1,351


              Operating  revenues, before  the  impact  of the  refunds  to

          customers, increased $.4 million.  A 5% decrease in kilowatt-hour


                                         -13-

                              KENTUCKY UTILITIES COMPANY
                       MANAGEMENTS' DISCUSSION AND ANALYSIS OF
                    FINANCIAL CONDITION AND RESULTS OF OPERATIONS

          sales   was   offset   by  $8.1 million   recovered   under   the

          environmental surcharge.    (Refer  to  Note 4 of  the  Notes  to

          Financial Statements, Environmental Cost Recovery, for  an update

          of environmental  surcharge legal proceedings.)   The decrease in

          kilowatt-hour sales  is attributable to a  decline in residential

          and  off-system  sales,  partially   offset  by  an  increase  in

          industrial  sales.   The  increase in  industrial sales  reflects

          continued  economic growth  in the  manufacturing sector  of KU's

          service area.   About 33% of the industrial sales increase is due

          to greater sales  to TMM.   The decrease  in off-system sales  is

          attributable to  a decrease in  demand for  power at  neighboring

          utilities.   The  decline  in residential  sales reflects  milder

          weather  during  the  six-month  period ended  June 30,  1995  as

          compared to the same period of 1994.

              Fuel  expense,  excluding  the  effect   of  the  refunds  to

          customers, decreased $4.2 million (5%).   This decrease primarily

          reflects a 4% decrease in tons of coal consumed.  Purchased power

          expense  increased $1.2 million (4%) due to an increase in demand

          costs ($2.2 million) partially offset  by a decrease in kilowatt-

          hour  purchases  ($1.0 million).  The decrease  in  kilowatt-hour

          purchases is due to the previously mentioned decline in kilowatt-

          hour sales.

              Other operating expenses increased $6.4 million (12%)  due to

          increased   generating   plant  operations   expenses  (primarily

          attributable to costs associated with  environmental compliance),

          advertising  and  marketing   program  expenses  and   timing  of

          administrative and general expenditures.

                                         -14-

                              KENTUCKY UTILITIES COMPANY
                       MANAGEMENTS' DISCUSSION AND ANALYSIS OF
                    FINANCIAL CONDITION AND RESULTS OF OPERATIONS

              Maintenance  expense increased  $.9 million  (3%)  due to  an

          increase in  production maintenance resulting from  the timing of

          scheduled maintenance at KU's generating stations.  This increase

          was   substantially  offset   by   a  decrease   in  distribution

          maintenance in  1995. Extensive  ice storm  damage  in the  first

          quarter  of  1994  increased  distribution  maintenance  in  that

          period.

              Depreciation  expense increased  $5.1 million (16%) resulting

          from the Ghent Unit 1 scrubber and two combustion turbine peaking

          units being placed into service late in 1994 and early 1995.

              Interest charges increased $3.3 million  (20%) reflecting the

          issuance  of $54 million of long-term  debt in the fourth quarter

          of 1994 and an increase in the average  amount of short-term debt

          outstanding.

              Federal  and   state   operating   income   taxes   decreased

          $6.4 million  (28%), primarily due to lower pre-tax income.


          CAPACITY REQUIREMENTS

              In   May  1995,  a   110-megawatt  (MW)   combustion  turbine

          generating unit, which was  placed in commercial operation during

          the  first quarter  of 1995, was  taken out  of service  due to a

          turbine blade problem.  In addition to this unit, KU has  decided

          not to  operate another similar combustion turbine unit placed in

          commercial operation  in  1994 and  has temporarily  discontinued

          testing  of  a  third   similar  unit  scheduled  for  commercial

          operation  later in 1995 until  the turbine blade  problem can be

          identified  and  corrected.     KU  is  currently  analyzing  the

                                         -15-

                              KENTUCKY UTILITIES COMPANY
                       MANAGEMENTS' DISCUSSION AND ANALYSIS OF
                    FINANCIAL CONDITION AND RESULTS OF OPERATIONS

          situation  in cooperation  with the  vendor of  the three  110 MW

          generating units.  Although KU cannot predict the outcome of this

          matter, KU does not  believe this will have a  significant impact

          on  its results  of operations  or its  ability to  meet customer

          requirements.

































                                         -16-


                              KENTUCKY UTILITIES COMPANY
                       MANAGEMENTS' DISCUSSION AND ANALYSIS OF
                    FINANCIAL CONDITION AND RESULTS OF OPERATIONS

          UTILITY ISSUES - COMPETITION

              In  March  1995,  the  Federal Energy  Regulatory  Commission

          (FERC) issued a Notice of Proposed Rulemaking (NOPR) by which the

          FERC will require public utilities that own or control facilities

          used  for  the  transmission  of electric  energy  in  interstate

          commerce  to  offer  "open  access"  transmission  service  on  a

          nondiscriminatory basis.   The  FERC also proposes  to allow,  in

          certain circumstances, the collection of charges for the recovery

          of  stranded costs  when customers change  power suppliers.   The

          FERC expects to issue final rules by February 1996.

              KU  filed  a  Transmission Services  (TS)  Tariff  and  Power

          Services (PS) Tariff on September 30, 1994 (refer to Management's

          Discussion  and Analysis in  the 1994 Annual  Report on Form 10-K

          under the heading "Utility Issues - Competition" for a discussion

          of  the TS Tariff and PS Tariff filed  by KU).  The FERC accepted

          the TS Tariff, subject to refund, effective December 1, 1994, but

          did not approve  the PS Tariff.   KU revised the  TS Tariff in  a

          filing made  on March 31,  1995 with  the FERC  in order  to meet

          certain provisions of the NOPR and reaffirmed its request for the

          market-based  PS Tariff.   On  May 31, 1995,  the FERC  issued an

          order which approved  the revised TS  Tariff, subject to  refund,

          and  approved the  PS Tariff  subject to  KU making  a compliance

          filing  which addressed certain aspects of the TS and PS Tariffs.

          On June 30, 1995, KU made the compliance filing with the FERC and

          the PS Tariff became effective on that date.

              Although KU  does not expect  either of these  new tariffs to

          have  a material impact on its  1995 revenues or income, they are

                                         -17-

                              KENTUCKY UTILITIES COMPANY
                       MANAGEMENTS' DISCUSSION AND ANALYSIS OF
                    FINANCIAL CONDITION AND RESULTS OF OPERATIONS

          indicative of  the increasingly competitive environment  in which

          KU and other utilities operate.







































                                         -18-

                             PART II.  OTHER INFORMATION

                              KENTUCKY UTILITIES COMPANY

          ITEM 1.  LEGAL PROCEEDINGS

          ENVIRONMENTAL COST RECOVERY

             See Note 4 of the Notes to Financial Statements,  Environmental

          Cost  Recovery, for  an update  of environmental  surcharge legal

          proceedings.

          ITEM 4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

             At  the April 25,  1995  Annual Meeting  of  Shareholders,  the

          following proposal was acted upon and approved.

             (1)   To elect three Directors to the Board of Directors of

                  Kentucky Utilities believes that the motion is without merit and should be

          denied.Company.

                                                      Votes
                                           Votes for  Withheld

             William B. Bechanan           37,817,878    0
             Harry M. Hoe                  37,817,878    0
             Michael R. Whitley            37,817,878    0


          ITEM 6.  EXHIBITS AND REPORTS ON FORM 8-K

             (a) Exhibits.

                 The following exhibits are filed as part of this report:

                 Exhibit
                 Number           Description



                    12      Computation4    Supplemental Indenture dated June 1,  1995 between
                         Kentucky  Utilities  Company and  Bank  of RatioAmerica
                         Illinois  and  Robert  J.  Donahue,  as  Trustees,
                         providing for  First  Mortgage Bonds  Series R  of
                         Earnings to Fixed Charges.Kentucky Utilities Company.

                   27    Financial Data Schedule  (required for  electronic
                         filing  only in accordance  with Item 601(c)(1) of
                         Regulation S-K.)S-K).

             (b) Reports on Form 8-K.

                 None.

                                         -14--19-




                              KENTUCKY UTILITIES COMPANY



                                      SIGNATURES





             Pursuant to the requirements of the Securities Exchange Act  of

          1934, the Registrant  has duly caused this report to be signed on

          its behalf by the undersigned thereunto duly authorized.





                                                KENTUCKY UTILITIES COMPANY
                                                       (Registrant)



          Date     NovemberAugust 9, 19941995               /s/ John T. Newton
                                                John T. NewtonMichael R. Whitley
                                                Michael R. Whitley
                                                Chairman of the Board and
                                                Chief Executive Officer






          Date     NovemberAugust 9, 19941995               /s/ Michael D. Robinson
                                                Michael D. Robinson
                                                Controller






                                         -15--20-