May 15, 2000


Securities and Exchange Commission
Operations Center
6432 General Green Way
Alexandria, VA  22312-2413

Gentlemen:

We are transmitting herewith Vectren Corporation's
Quarterly Report on Form 10-Q for the quarter ended
March 31, 2000, pursuant to the requirements of
Section 13 of the Securities Exchange Act of 1934.

Very truly yours,


/s/James A.Hummel, II
James A.Hummel, II

JH:tmw


             SECURITIES AND EXCHANGE COMMISSION
                   Washington, D.C. 20549

                          FORM 10-Q


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

For quarterly period ended March 31, 2000

                             OR

[ ]  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 1-15467


                       VECTREN CORPORATION
   (Exact name of registrant as specified in its charter)

                 INDIANA                       35-1654378
(State or other jurisdiction of              (I.R.S Employer
incorporation or organization)               Identification
                                             No.)


      20 N.W. Fourth Street, Evansville, Indiana 47741
    (Address of principal executive offices and Zip Code)

                    (812)  465-5300
    (Registrant's telephone number, including area code)

     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 [ ]

     Indicate the number of shares outstanding of each of
the issuer's classes of common stock, as of the latest
practicable date.

Common Stock - Without par value        61,299,435        March 31,2000
         Class                       Number of shares         Date




                      TABLE OF CONTENTS


Item
Number

               Part I.  Financial Statements
  1    Financial Statements (Unaudited)
       Vectren Corporation
          Consolidated Balance Sheets
          Consolidated Statements of Income
          Consolidated Statements of Cash Flows
       Notes to Unaudited Consolidated Financial
       Statements
  2    Management's Discussion and Analysis of
       Financial Condition and
          Results of Operations
  3    Quantitative and Qualitative Disclosure
       Market Risk

                PART II.  OTHER INFORMATION
  1    Legal Proceedings
  4    Submission of Matters to a Vote of Security
       Holders
  6    Exhibits and Reports on Form 8-K
       Signatures




                     VECTREN CORPORATION
                 CONSOLIDATED BALANCE SHEETS
                   (Unaudited - Thousands)


                                                  March 31        December 31
                                              2000       1999         1999
                                                       
                ASSETS

Current Assets:
     Cash and cash equivalents          $   19,559 $   51,858   $   17,351
                                            19,559     51,858
     Temporary investments                   1,058        747          903
     Accounts receivable, less
reserves of $4,863,
          $5,091 and $3,949                142,270    109,061      123,612
     Accrued unbilled revenues              32,651     37,877       55,370
     Inventories                            38,690     50,227       58,863
     Prepaid gas delivery service              114          -       20,937
     Prepayments and other                  29,463     15,310       28,676
          Total current assets             263,805    265,080      305,712

Utility Plant:
     Original cost                       2,375,474  2,288,219    2,367,831
     Less:  accumulated depreciation     1,042,326    988,403    1,031,498
and amortization
          Net utility plant              1,333,148  1,299,816    1,336,333

Other Investments and Property             285,937    191,838      260,713

Deferred Charges and Other Assets           72,759     69,428       80,300

TOTAL ASSETS                            $1,955,649 $1,826,162   $1,983,058


The accompanying notes are an integral part of these consolidated
financial statements.






                     VECTREN CORPORATION
                 CONSOLIDATED BALANCE SHEETS
                   (Unaudited - Thousands)


                                                  March 31        December 31
                                              2000       1999         1999
                                                          
 LIABILITIES AND SHAREHOLDERS' EQUITY

Current Liabilities:
     Current maturities of long-term
debt and                                   $53,890   $108,883      $53,880
        other obligations
     Notes payable                         171,921    122,912      208,234
     Accounts payable                       88,580     72,635       95,827
     Refunds to customers                   23,495     40,244       27,396
     Accrued taxes                          30,904     33,883       26,602
     Accrued interest                        7,058      8,275       12,097
     Other current liabilities              72,779     50,214       52,058
          Total current liabilities        448,627    437,046      476,094

Deferred Credits and Other
Liabilities:
     Deferred income taxes                 208,466    204,494      215,520
     Accrued postretirement benefits        42,346     39,075       40,942
other than pensions
     Unamortized investment tax credit      24,934     27,293       25,524
     Other                                   8,038      7,570        8,297
          Total deferred credits and       283,784    278,432      290,283
other liabilities

Minority interest in subsidiary              1,021        777          916

Capitalization:
     Long-term debt and other              485,770    388,459      486,726
obligations
     Preferred stock of subsidiary:
          Redeemable                         8,076      8,192        8,192
          Nonredeemable                     11,090     11,090       11,090
               Total preferred stock        19,166     19,282       19,282
     Common stock (no par value) -
issued and                                 215,917    215,124      215,917
        outstanding 61,299, 61,439 and
61,467 respectively
     Retained earnings                     501,348    487,082      493,918
     Accumulated other comprehensive            16       (40)         (78)
income
          Total common shareholders'       717,281    702,166      709,757
equity
               Total capitalization      1,222,217  1,109,907    1,215,765

TOTAL LIABILITIES AND SHAREHOLDERS'
        EQUITY                          $1,955,649 $1,826,162   $1,983,058


The accompanying notes are an integral part of these consolidated financial statements.




                     VECTREN CORPORATION
              CONSOLIDATED STATEMENTS OF INCOME
       (Unaudited - Thousands, except per share data)

                                       Three Months        Twelve Months
                                       Ended March 31      Ended March 31
                                    2000         1999   2000           1999
                                                       
OPERATING REVENUES:
     Electric Utility               $ 72,990 $ 70,987   $  309,572 $  303,625
     Gas Utility                     200,845  191,182      509,236    485,393
     Energy services and other        85,609   58,864      288,020    221,741
          Total operating revenues   359,444  321,033    1,106,828  1,010,759

OPERATING EXPENSES:
     Fuel for electric generation     16,573   15,628       67,250     65,940
     Purchased electric energy         3,477    3,262       21,006     22,338
     Cost of gas sold                118,527  103,499      281,457    260,516
     Cost of energy services and      81,722   56,170      273,142    210,740
other
     Other operating                  46,426   44,833      191,215    185,601
     Merger costs                     27,181        -       27,181          -
     Depreciation and amortization    22,662   21,225       88,435     82,658
     Taxes other than income taxes     8,600    8,283       30,227     27,178
          Total operating expenses   325,168  252,900      979,913    854,971

OPERATING INCOME                      34,276   68,133      126,915    155,788

OTHER INCOME
     Equity in earnings of             2,502    4,179        3,689      6,820
unconsolidated affiliates
     Other - net                      12,393    1,907       25,664     11,299
          Total other income          14,895    6,086       29,353     18,119

INTEREST EXPENSE                      12,273   10,170       44,965     40,004

INCOME BEFORE PREFERRED DIVIDENDS
AND INCOME TAXES                      36,898   64,049      111,303    133,903


PREFERRED DIVIDEND REQUIREMENT OF        269      270        1,077      1,091
SUBSIDIARY

INCOME BEFORE INCOME TAXES            36,629   63,779      110,226    132,812

INCOME TAXES                          14,362   22,986       37,433     44,762

NET INCOME BEFORE MINORITY INTEREST   22,267   40,793       72,793     88,050

MINORITY INTEREST IN SUBSIDIARY          142       70          643        295

NET INCOME                          $ 22,125 $ 40,723   $   72,150 $   87,755


AVERAGE COMMON SHARES OUTSTANDING     61,299   61,301       61,298     61,499
BASIC EARNINGS PER AVERAGE SHARE
     OF COMMON STOCK                $   0.36 $   0.66   $     1.18 $     1.43

DILUTED EARNINGS PER AVERAGE SHARE
OF COMMON STOCK                     $   0.36 $   0.66   $     1.18 $     1.42


The accompanying notes are an integral part of these consolidated financial statements.






                                   VECTREN CORPORATION
                         CONSOLIDATED STATEMENTS OF CASH FLOWS
                                 (Unaudited - Thousands)

                                          Three Months           Twelve Months
                                         Ended March 31          Ended March 31
                                       2000           1999     2000           1999
                                                                  
CASH FLOWS FROM OPERATING ACTIVITES
  Net Income                           $ 22,125       $ 40,723 $  72,150      $  87,755

  Adjustments to reconcile
    net income to cash
    provided from operating
    activities -
      Merger costs                       27,181              -    27,181              -
      Depreciation and
        amortization                     22,662         21,225    88,435         82,658
      Preferred dividend
        requirement                         269            270     1,077          1,091
      Deferred income taxes
        and investment
        tax credits                      (7,644)          (709)    1,613          5,957
      Allowance for funds
        used during
        construction                          -              -       296             (4)
      Loss (gain) on sale or
        retirement of assets                  -              -         -         (2,102)
      Undistributed earnings
        of unconsolidated
        affiliates                         (2,677)      (4,294)    (4,520)       (7,160)
                                           39,791       16,492    114,082        80,440

      Changes in assets and
        liabilities -
         Receivables - net                   4,061      12,066    (27,983)       (9,717)
         Inventories                        20,174      16,459     11,537       (17,662)
         Accounts payable,
          customer deposits,
          advance payments
          other current
          liabilities                       (7,242)    (13,580)    17,794         9,862
         Accrued taxes and
          other interest                      (737)     17,044     (4,196)      (14,035)
         Recoverable/
          refundable gas
          costs                             (3,901)      1,329    (16,749)       10,597
         Prepayments and
          other current
          assets                              (942)      5,953    (14,464)        3,352
         Prepaid gas
          delivery                          20,823           -       (114)            -
         Other - net                         3,582       1,116       (668)        1,047
           Total adjustments                75,609      56,879     79,239        63,884
           Net cash flows
            from operations                 97,734      97,602    151,389       151,639

CASH FLOWS FROM (REQUIRED
FOR) FINANCING ACTIVITIES
   Repurchase of common
     stock                                       -           -     (2,330)       (7,046)
   Change in long-term debt                   (946)       (470)    42,318         6,136
   Net change in short-term
     borrowings                            (36,313)     (3,071)    49,009        28,866
   Payments on partnership
     obligations                              (596)     (1,237)      (872)       (1,803)
   Dividends on common stock               (14,695)    (15,001)   (57,622)      (57,279)
   Other                                       265      (2,537)     5,328         1,189
     Net cash flows from
      (required for)
      financing activities                 (52,285)    (22,316)    35,831       (29,937)

CASH FLOWS FROM (REQUIRED
FOR) INVESTING ACTIVITIES
   Capital expenditures                    (30,841)    (29,747)  (132,055)     (123,433)
   Demand Side Management
     program expenditures                     (111)        (33)      (330)       (1,063)
   Investment in leveraged
     leases and partnerships                   118         728    (48,639)          108
   Non-regulated investment
     in consolidated
     subsidiaries                            7,738      (1,586)     4,295       (13,097)
   Non-regulated investments
     in unconsolidated
     affiliates - net                        1,420      (1,458)         -             -
   Change in nonutility
     property                              (20,890)        490    (45,235)       (1,599)
   Cash distributions from
     unconsolidated
     affiliates                                  -         631      4,475         3,699
   Proceeds from sale
     of assets                                   -           -          -        13,317
   Other                                      (675)        156     (2,030)       (2,842)
      Net cash flows
       required for
       investing activities                (43,241)    (30,819)  (219,519)     (124,910)

Net increase (decrease) in
  cash                                       2,208      44,467    (32,299)       (3,208)

Cash and cash equivalents at
  beginning of period                       17,351       7,391     51,858        55,066

Cash and cash equivalents at
  end of period                           $ 19,559    $ 51,858  $  19,559     $  51,858

The accompanying notes are an integral part of these consolidated financial statements.




                     VECTREN CORPORATION
         NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                         (UNAUDITED)


1.   Organization and Nature of Operations

Vectren Corporation (Vectren) is an Indiana corporation that was
organized on June 10, 1999 solely for the purpose of effecting the
merger of Indiana Energy, Inc. (Indiana Energy) and SIGCORP, Inc.
(SIGCORP) with and into Vectren and carrying on the combined business
of Indiana Energy and SIGCORP.  On March 31, 2000 the merger of
Indiana Energy with SIGCORP and into Vectren was consummated with a
tax-free exchange of shares and has been accounted for as a pooling
of interests.  The common shareholders of SIGCORP received one and
one-third shares of Vectren common stock for each SIGCORP common
share and Indiana Energy common shareholders received one share of
Vectren common stock for each Indiana Energy common share, resulting
in the issuance of 61.3 million shares of Vectren common stock.  The
preferred stock and debt securities of Indiana Energy's and SIGCORP's
utility subsidiaries were not affected by the merger.

Vectren is public utility holding company with two operating public
utilities, Indiana Gas Company, Inc. (Indiana Gas) and Southern
Indiana Gas and Electric Company (SIGECO).  Indiana Gas and its
subsidiaries provide natural gas and transportation services to a
diversified base of customers in 311 communities in 49 of Indiana's
92 counties.  SIGECO provides generation, transmission, distribution
and the sale of electric power and the distribution and sale of
natural gas to communities and counties in southwestern Indiana.

Vectren is also involved in non-regulated activities through its
subsidiaries and investments in joint ventures:  Vectren Enterprises,
Inc., Vectren Energy Services, Inc., Vectren Financial Group, Inc.,
Vectren Generation Services, Inc.,  Vectren Resources, LLC, Vectren
Utility Services, Inc.,  Vectren Ventures, Inc.,  and Vectren
Communications, Inc.  These non-regulated activities provide energy,
telecommunications and finance services throughout the Midwest.


2.     Summary of Significant Accounting Policies

A.  Financial Statements
As a result of the merger, Vectren has elected to consolidate the
results of the combining companies on a calendar year basis in the
accompanying financial statements for all periods presented.

The interim financial statements included in this report have been
prepared by Vectren, without audit, as provided in the rules and
regulations of the Securities and Exchange Commission.  Certain
information and footnote disclosures normally included in financial
statements prepared in accordance with generally accepted principles
have been omitted as provided in such rules and regulations.  Vectren
believes that the information in this report reflects all necessary
adjustments necessary to fairly state the results of the interim
periods reported.  Because of the seasonal nature of Vectren's
utilities operations, the results shown on a quarterly basis are not
necessarily indicative of annual results.
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates
and assumptions that affect the reported amounts of assets and
liabilities and disclosure of contingent assets and liabilities at
the date of the statements and the reported amounts of revenues and
expenses during the reporting period.  Actual results could differ
from those estimates.

B.   Consolidation
The consolidated financial statements include the accounts of Vectren
and its wholly owned subsidiaries, after elimination of intercompany
transactions.  Investments in limited partnerships and less than
majority-owned affiliates are accounted for on the equity method.
The financial statements for prior periods have been restated to
reflect the consolidation of a majority-owned affiliate, Energy
Systems Group, Inc., which was an  equity method investment of
Indiana Energy and SIGCORP prior to the merger.



C.   Regulation
The business operations of Indiana Gas and SIGECO are subject to
regulation by the Indiana Utility Regulatory Commission (IURC).  The
Federal Energy Regulatory Commission (FERC) has jurisdiction over
those investor-owned utilities that make wholesale energy sales.  The
accounting policies of Vectren and its utility subsidiaries give
recognition to the ratemaking and accounting practices of these
agencies and to generally accepted accounting principles, including
the provisions of Statement of Financial Accounting Standards (SFAS)
No. 71 "Accounting for the Effects of Certain Types of Regulation."
Regulatory assets represent probable future revenues  associated with
certain incurred costs which will be recovered from customers through
the ratemaking process.  Regulatory liabilities represent probable
future reductions in revenues associated with amounts that are to be
credited to customers through the ratemaking process.

D.   Revenues
To more closely match revenues and expenses, Indiana Gas and SIGECO
record revenues for all gas and electric service delivered to
customers but not billed at the end of the accounting period.

E.   Inventories
Inventories primarily consist of gas in underground storage, fuel for
electric generation and materials and supplies.  Gas in underground
storage is valued using last-in, first-out (LIFO) method, while other
inventories are valued using the average cost method.  Based on the
average cost of gas purchased during the three months ended  March
2000, the cost of replacing the current portion of gas in underground
storage exceeded LIFO cost at March 31, 2000 by approximately $17.1
million.

F.   Refundable or Recoverable Gas and Fuel Costs
The cost of natural gas and  fuel used in the production of electric
power and cost of purchased power from other sources, which differ
from amounts recovered through rates, are deferred, and are being
recovered or refunded in accordance with procedures approved by the
IURC.  In 1999, the IURC issued a generic order which established new
guidelines for the recovery of purchased power costs through fuel
adjustments clauses.  Those guidelines provide that SIGECO is able to
recover through rates the total cost incurred for purchased power if
the weekly average cost of purchased power is below the highest cost
of internal generation at SIGECO or the purchased power cost in
excess of the internal generation cost can be satisfactorily
justified in a fuel adjustment clause proceeding.  The Office of
Utility Consumer Counselor (OUCC) have appealed this generic order.

G.   Utility Plant and Depreciation
Utility plant is stated at historical cost, including an allowance
for the cost of funds used during construction.  Depreciation of
utility property is provided using the straight-line method over the
estimated service lives of the depreciable assets.

Cost in excess of underlying book value of acquired gas distribution
companies is reflected as a component of utility plant and is being
amortized  over 40 years.

H.   Reclassifications
Certain reclassifications have been made to prior period financial
statements to conform with the current year classification.  Certain
reclassifications have also been made to the financial statements
included in the Form 8-K filed on April 27, 2000, with respect to the
release of Vectren financial information.  The line items affected by
these reclassifications were cash and accrued taxes. These
reclassifications have no impact on previously reported net income.

3.   Merger Costs

Merger costs expensed by Vectren at March 31, 2000 totaled
$27.2 million. These costs relate primarily to transaction
costs, severance and other merger integration activities and
the accrual remaining for such costs at March 31, 2000 is
approximately $14 million. The merger integration activities
will be substantially complete by 2001.

4.   Indiana Energy and SIGCORP Results (Prior to the
  Combination)

The results of the predecessor companies, Indiana Energy and SIGCORP,
for the three months ended March 31, 2000, the period prior to the
combination, and for the three months ended March 31, 1999 are as
follows (in millions):




Indiana Energy:
                                   Three Months Ended   Three Months Ended
                                      March 31, 2000      March 31, 1999
                                                  
Revenues                                $    172.0         $    161.8
Net Income                                    22.1               28.1


SIGCORP:
                                   Three Months Ended   Three Months Ended
                                      March 31, 2000      March 31, 1999

Revenues                                $    187.4         $    150.2
Net Income                                    19.3               12.6




As the merger was effective March 31, 2000, the difference in the
amounts reported in the consolidated statement of income for the
three months ended March 31, 2000, and the results of the predecessor
companies are the merger costs.

5.   Acquisition of the Gas Distribution Assets of The
     Dayton Power and Light Company

On December 15, 1999, Indiana Energy announced that the board of
directors had approved a definitive agreement under which the company
will acquire the natural gas distribution assets of The Dayton Power
and Light Company.  The acquisition, with a purchase price of $425
million, is expected to be funded with commercial paper (back-stopped
by a committed bank credit facility) which will be replaced over time
with permanent financing.  This transaction is conditioned upon the
approval of several regulatory bodies.  Management hopes to complete
the transaction by mid year 2000.

6.   Cash Flow Information

For purposes of the Consolidated Statement of Cash Flows, Vectren
considers cash investments with an original maturity of three months
or less to be cash equivalents.  Cash paid during the periods
reported for interest and income taxes were as follows:




                               Three Months Ended    Twelve Months Ended
                                   March 31                March 31

Thousands                         2000     1999         2000      1999
                                                    
Interest (net of amount         $15,268   $10,485     $39,509   $38,023
capitalized)
Income taxes                    $21,601   $13,552     $48,962   $36,411



7.   Long - Term Debt

On March 1, 2000, the fixed rate 7.25% $22,500,000 Pollution
Control Series A Bonds of SIGECO, due March 1, 2014, were
converted to a Municipal Auction Rates Series.  The interest
rate, currently 4.35%, will be set every 32 days through the
municipal bond auction process.

On March 1, 2000, the interest rate on $31,500,000 of
Adjustable Rate Pollution Control bonds of SIGECO, due March
1, 2025,  was changed from 3.00% to 4.30%.  The new interest
rate will be fixed through February 29, 2001.  Also on March
1, 2000, the interest rate on $22,200,000 of Adjustable Rate
Pollution Control bonds of SIGECO, due March 1, 2020, was
changed from 3.05% to 4.45%.  The new interest rate will
also be fixed through February 29, 2001.  For financial
statement presentation, the $53,700,000 of Adjustable Rate
Pollution Control bonds are shown as a current liability.


On December 23, 1999 SIGCORP Capital, Inc. (now Vectren
Capital Corporation) established a $100 Million Committed
Bank Credit Facility.  This facility, syndicated among five
banks, replaced several uncommitted lines of credit and is
used to fund non-regulated operations.  At March 31, 2000,
there was $90.1 million drawn against this facility.  In
addition, there was $56.3 million in other notes payable
outstanding.

8.   ProLiance Energy, LLC

ProLiance Energy, LLC (ProLiance), a 50% owned non-regulated
marketing affiliate of Vectren, began providing natural gas
and related services to Indiana Gas and Citizens Gas and
Coke Utility (Citizens Gas) effective April 1, 1996.

The sale of gas and provision of other services to Indiana
Gas by ProLiance is subject to regulatory review through the
quarterly gas cost adjustment process administered by the
IURC.

On September 12, 1997, the IURC issued a decision finding
the gas supply and portfolio administration agreements
between ProLiance and Indiana Gas and ProLiance and Citizens
Gas (the gas supply agreements) to be consistent with the
public interest. The IURC's decision reflected the
significant gas cost savings to customers obtained by
ProLiance's services and suggested that all material
provisions of the agreements between ProLiance and the
utilities are reasonable. Nevertheless, with respect to the
pricing of gas commodity purchased from ProLiance and two
other pricing terms, the IURC concluded that additional
review in the gas cost adjustment (GCA) process would be
appropriate and directed that these matters be considered
further in the pending, consolidated GCA proceeding
involving Indiana Gas and Citizens Gas. The IURC has not yet
established a schedule for conducting these additional
proceedings.

The IURC's September 12, 1997, decision was appealed to the
Indiana Court of Appeals by certain Petitioners, including
the Indiana Office of Utility Consumer Counselor, the
Citizens Action Coalition of Indiana, and a small group of
large-volume customers. On October 8, 1998, the Indiana
Court of Appeals issued a decision which reversed and
remanded the case to the IURC with instructions that the gas
supply agreements be disapproved. The basis for the decision
was that because the gas supply agreements provide for index
based pricing of gas commodity sold by ProLiance to the
utilities, the gas supply agreements should have been the
subject of an application for approval of an alternative
regulatory plan under Indiana statutory law.

On April 22, 1999, the Indiana Supreme Court granted a
petition for transfer of the case and will now consider the
appeal of the IURC's decision and issue its own decision on
the merits of the appeal at a later date.  By granting
transfer, the Supreme Court has vacated the Court of
Appeals' decision.

If the Supreme Court reverses the IURC's decision , the case
will be remanded to the IURC for further proceedings
regarding the public interest in the gas supply agreements.
If the Supreme Court affirms the IURC's decision, as
described above, the reasonableness of certain of the gas
costs incurred by Indiana Gas under the gas supply
agreements will be further reviewed by the IURC in the
consolidated GCA proceeding. The existence of significant
benefits to the utilities and their customers resulting from
ProLiance's services has not been challenged on appeal.
Indiana Gas and Citizens Gas are continuing to utilize
ProLiance for their gas supplies.

On or about August 11, 1998, Indiana Gas, Citizens Gas and
ProLiance each received a Civil Investigative Demand ("CID")
from the United States Department of Justice requesting
information relating to Indiana Gas' and Citizens Gas'
relationship with and the activities of ProLiance. The
Department of Justice issued the CID to gather information
regarding ProLiance's formation and operations, and to
determine if trade or commerce has been restrained. Indiana
Gas has provided all information requested and management
continues to believe that there are no significant issues in
this matter.

 Indiana Gas continues to record gas costs in accordance
with the terms of the ProLiance contract and Vectren
continues to record its proportional share of ProLiance's
earnings. Pretax income of $3.4 million and $5.0 million,
was recognized as ProLiance's contribution to earnings in
the first quarter of  2000 and 1999, respectively.   Pretax
earnings recognized from ProLiance for the twelve months
ended March 31, 2000, totaled $5.1 million compared to $8.1
million for the same period last year. Earnings recognized
from ProLiance are included in Equity in Earnings of
Unconsolidated Affiliates on the Consolidated Statements of
Income.

At March 31, 2000, Indiana Energy has reserved approximately
$2.2 million of ProLiance earnings after tax. Total after-
tax ProLiance earnings recognized to date approximate $21.6
million.  This amount includes earnings from all of
ProLiance's business activities, and therefore is believed
to be a conservative estimate of the upper risk limit.
Resolution of the above proceedings may also impact future
operations and earnings contributions from ProLiance. Based
on the IURC's findings described above, management believes
the ProLiance issues may be resolved near the levels that
are already being reserved, and therefore, while these
proceedings are pending, does not anticipate changing the
level at which it reserves ProLiance earnings. However, no
assurance of this outcome can be provided.

9.   Pace Carbon Synfuels Investors, L.P.

Vectren Synfuels, Inc. (Vectren Synfuels), formerly IEI
Synfuels, Inc., a wholly-owned, indirect subsidiary of
Vectren holds one limited partnership unit in Pace Carbon
Synfuels Investors, L.P. (Pace Carbon), a Delaware limited
partnership formed to develop, own and operate four projects
to produce and sell coal-based synthetic fuel. Pace Carbon
converts coal fines (small coal particles) into briquettes
that are sold to major coal users such as utilities and
steel companies. This process is eligible for federal tax
credits under Section 29 of the Internal Revenue Code (Code)
and the Internal Revenue Service has issued a private letter
ruling with respect to the four projects.

Vectren Synfuels has made an initial investment of $7.5
million in Pace Carbon for an 8.3 percent ownership interest
in the partnership.  Vectren Synfuels has agreed to advance
up to $1.8 million, of which $.4 million was paid through
March 2000, against future cash flows of the partnership for
capital improvements and financing capital needs. In
addition to its initial investment, Vectren Synfuels has a
continuing obligation to invest in Pace Carbon approximately
$40 million, with any such additional investments to be
funded solely from a portion of the federal tax credits that
are earned from the production and sale of briquettes by the
projects.

The realization of the tax credits from this investment is
dependent upon a number of factors including among others
(1) the production facilities must have been in operation by
June 30, 1998, (2) adequate coal fines must be available to
produce the briquettes, and (3) the briquettes must be
produced and sold.  All four of Pace Carbon's coal-based
synthetic fuel production facilities were placed into
service by June 30, 1998, and are currently producing and
selling briquettes in an extended ramp up mode.  Further
enhancements to the production process and project upgrades
are expected to be completed and in full production in mid
calendar year 2000.

Generally, all briquettes produced through March 31, 2000,
have been sold.  However, due to a deterioration in both the
domestic and export coal markets, domestic companies' coal
supplies are up, which in turn has reduced the demand and
created some price pressure for Pace Carbon's coal-based
synthetic product.  Management does not believe that the
extended time required to make necessary production process
enhancements nor the current coal market conditions will
significantly affect the long-term success of the projects.
Accordingly, management continues to believe that
significant project benefits, primarily in the form of tax
savings and tax credits realized, will be achieved in the
future, however, no assurance can be given.

10.  Haddington Energy Partners, L.P.

On October 9, 1998, IEI Investments, now Vectren
Enterprises, committed to invest $10 million in Haddington
Energy Partners, L.P. (Haddington). Haddington, a Delaware
limited partnership, raised $77 million to invest in
projects that represent a portfolio of development
opportunities, including high deliverability gas storage,
compressed air energy storage, thermally-balanced
cogeneration, fuel cells, hydrogen generators, and gathering
and processing in the Powder River Basin. Haddington's
investment opportunities primarily focus on acquiring and
completing energy projects under development rather than
start-up ventures. Through March 31, 2000, Vectren
Enterprises had paid approximately $8.5 million of its
commitment in Haddington, with the remainder to be paid in
calendar 2000.

11.  Reliant Services

On June 30, 1998, IGC Energy, now Vectren Utility Services,
and Cinergy Supply Network, Inc., a subsidiary of Cinergy
Corp. (Cinergy), formed Reliant Services, LLC (Reliant), an
equally owned limited liability company, to perform
underground facilities locating and construction services.
In May 1999, Reliant purchased the assets of two
Indianapolis-based companies to enable it to enter that
market.  The asset purchase was completed after Cinergy
received all necessary regulatory approvals.  In August
1999, Reliant entered the meter reading business as well.
Reliant is based in the Indianapolis area and focuses on
serving electric, gas, telephone, cable and water companies
in Indiana, Ohio and Kentucky.  Through March 31, 2000,
Vectren Utility Services had invested approximately $3.1
million in Reliant.

12.  Vectren Advanced Communications

In May 1998, Vectren Advanced Communications, Inc. (formerly
SIGCORP Advanced Communications, Inc.), a wholly owned
subsidiary, was formed to hold Vectren's investment in
SIGECOM, LLC and Utilicom Networks, Inc.  Also on May 7,
1998,  a joint venture between Vectren Advanced
Communications and Utilicom was formed to provide enhanced
communication services over a high capacity fiber optic
based network in the greater Evansville, Indiana area.  -.
Vectren Advanced Communications' investment was in the form
of  a preferred interest in SIGECOM, which had a 100%
liquidation preference.  In addition, SIGCORP contributed
its wholly-owned subsidiary, ComSource, Inc., to SIGECOM on
July 1, 1998.

On January 28, 2000, affiliates of Blackstone Capital
Partners III, a private equity fund of The Blackstone Group,
invested in class B equity units of Utilicom Holdings LLC,
the newly formed holding company for Utilicom.  The
investment was the first part of a commitment by Blackstone
to invest up to $100 million to fund future growth
opportunities in the fiber optic networks.  At the same
time, Vectren Advanced Communications exchanged 35% of its
49%  equity interest in SIGECOM for $16.5 million of
convertible debt of Utilicom Holdings.  The debt is
convertible into class A equity units at a future date or in
the event of a public offering of stock by Utilicom.
Vectren Advanced Communications' remaining 14% preferred
equity interest in SIGECOM was converted to a 14% indirect
common equity interest in SIGECOM.  The investment
restructuring resulted in a pretax  gain of $8.0 million to
SIGCORP which is classified in Other Income in the
accompanying consolidated statements of income. As of March
31, 2000, Vectren Advanced Communications' investment in
SIGECOM was $7.4 million, including the value of ComSource,
Inc.

13.  Air Quality Services

On November 11, 1998, SIGCORP Environmental Services, Inc.
(now Vectren Environmental Services, Inc.) and Environmental
Management Consultants, Inc., formed Air Quality Services
(AQS), LLC to provide air emissions testing, monitoring and
consulting services to utility and industrial companies.
Vectren Environmental Services owns 51% and Environmental
Management Consultants, Inc. owns 49% of AQS.  Through March
31, Vectren Environmental Services had invested
approximately $.4 million in AQS.

14.  Environmental Matters

Manufactured Gas Plants
Indiana Gas is currently conducting environmental
investigations and work at many of the 26 sites that were
the locations of former manufactured gas plants. It has been
recovering the costs of the investigations and work from
insurance carriers and other potentially responsible parties
(PRPs). The IURC has determined that these costs are not
recoverable from utility customers.

Indiana Gas has PRP agreements in place covering 19 of the
26 sites.  The agreements provide for coordination of
efforts and sharing of investigation and clean-up costs
incurred and to be incurred at the sites. These agreements
limit Indiana Gas' share of past and future response costs
at these 19 sites to between 20 and 50 percent.  Based on
the agreements, Indiana Gas has accrued its proportionate
share of the estimated cost related to work not yet
performed.

In early 1999, Indiana Gas filed a complaint in Indiana
state court to continue its pursuit of insurance coverage
from four insurance carriers. As of March 31, 2000,
settlement agreements were  reached with each of these
insurers and the litigation was dismissed.

These environmental matters have had no material impact on
earnings since costs recorded to date approximate PRP
recoveries and insurance settlements received. While Indiana
Gas has recorded all costs which it presently expects to
incur in connection with remediation activities, it is
possible that future events may require some level of
additional remedial activities which are not presently
foreseen.

Clean Air Act
In October, 1997, the United States Environmental Protection
Agency (USEPA) proposed a rulemaking that could require
uniform NOx emissions reductions of 85 percent by utilities
and other large sources in a 22-state region spanning areas
in the Northeast, Midwest, Great Lakes, Mid-Atlantic and
South. This rule is referred to as the "NOx SIP call".  The
USEPA provided each state a proposed budget of allowed NOx
emissions, a key ingredient of ozone, which requires a
significant reduction of such emissions.  Under that budget,
utilities may be required to reduce NOx emissions to a rate
of 0.15 lb/mmBtu from levels already imposed by Phase I and
Phase II of the Clean Air Act Amendments of 1990.
Midwestern states (the alliance) have been working together
to determine the most appropriate compliance strategy as an
alternative to the USEPA proposal.  The alliance submitted
its proposal, which calls for a smaller, phased in reduction
of NOx levels, to the USEPA and the Indiana Department of
Environmental Management in June 1998.

In July 1998, Indiana submitted its proposed plan to the
USEPA in response to the USEPA's proposed new NOx rule and
the emissions budget proposed for Indiana.  The Indiana
plan, which calls for a reduction of NOx emissions to a rate
of 0.25 lb/mmBtu by 2003, is less stringent than the USEPA
proposal but more stringent than the alliance proposal.

In October 27, 1998 USEPA issued a final rule "Finding of
Significant Contribution and Rulemaking for Certain States
in the Ozone Transport Assessment Group Region for Purposes
of Reducing Regional Transport of Ozone," (63 Fed. Reg.
57355). The final rule requires that 23 states and
jurisdictions must file revised state implementation plans
("SIPs") with EPA by no later than September 30, 1999, which
was essentially unchanged from its October 1997, proposed
rule.  The USEPA has encouraged states to target utility
coal-fired boilers for the majority of the reductions
required, especially NOx emissions.  Northeastern states
have claimed that ozone transport from midwestern states
(including Indiana) is the primary reason for their ozone
concentration problems.  Although this premise is challenged
by others based on various air quality modeling studies,
including studies commissioned by the USEPA, the USEPA
intends to incorporate a regional control strategy to reduce
ozone transport.  The USEPA's final ruling is being
litigated in the federal courts by approximately ten
midwestern states, including Indiana.



During the second quarter of 1999, the USEPA lost two
federal court challenges to key air-pollution control
requirements.  In the first ruling by the U.S. Circuit Court
of Appeals for the District of Columbia on May 14, 1999, the
Court struck down the USEPA's attempt to tighten the one-
hour ozone standard to an eight-hour standard and the
attempt to tighten the standard for particulate emissions,
finding the actions unconstitutional.  In the second ruling
by the same Court on May 25, 1999, the Court placed an
indefinite stay on the USEPA's attempts to reduce the
allowed NOx emissions rate from levels required by the Clean
Air Act Amendments of 1990.  The USEPA appealed both court
rulings.  On October 29, 1999, the Court refused to
reconsider its May 14, 1999 ruling.

On March 3, 2000,  the D.C. Circuit of Appeals upheld the
USEPA's October 27, 1998 final rule requiring 23 states and
the District of Columbia to file revised SIPs with EPA by no
later than September 30, 1999.  Numerous petitioners,
including several states, have filed a petition for
rehearing with the U.S. Court of Appeals for the District of
Columbia in Michigan v. EPA. Petitioners seek rehearing
primarily on two issues: (1) EPA's consideration of the cost-
effectiveness of NOx controls, rather than air quality
effects, as the basis for determining the amount of each
State's emissions that "contribute[s] significantly to non-
attainment" of the ozone National Ambient Air Quality
Standards ("NAAQS") in another State; and (2) EPA's choice
of $2000/ton-removed as the cost-effectiveness cut-off
point.

The proposed NOx emissions budget for Indiana stipulated in
the USEPA's final ruling requires a 36% reduction in total
NOx emissions from Indiana.  The ruling could require SIGECO
to lower its system-wide emissions by approximately 70%.
Depending on the level of system-wide emissions reductions
ultimately required, and the control technology utilized to
achieve the reductions, the estimated construction costs of
the control equipment could reach $100 million, and related
additional operation and maintenance expenses could be an
estimated $8 million to $10 million, annually.  Under the
USEPA implementation schedule, the emissions reductions and
required control equipment must be implemented and in place
by May 15, 2003.

Approximately 12 months ago, the USEPA initiated an
investigation under Section 114 of the Clean Air Act (the
Act) of SIGECO's coal-fired electric generating units in
commercial operation by 1977 to determine compliance with
environmental permitting requirements related to repairs,
maintenance, modifications and operations changes.  The
focus of the investigation was to determine whether new
source performance standards should be applied to the
modifications and whether the best available control
technology was, or should have been, used.  Numerous other
electric utilities were, and are currently, being
investigated by the USEPA under an industry-wide review for
similar compliance.  SIGECO responded to all of the USEPA's
data requests during the investigation.  In July 1999,
SIGECO received a letter from the Office of Enforcement and
Compliance Assurance of the USEPA discussing the industry-
wide investigation, vaguely referring to the investigation
of SIGECO and inviting SIGECO to participate in a discussion
of the issues.  No specifics were noted; furthermore, the
letter stated that the communication was not intended to
serve as a notice of violation.  Subsequent meetings were
conducted in September and October with the USEPA and
targeted utilities, including SIGECO, regarding potential
remedies to the USEPA's general allegations.

On November 3, 1999, the USEPA filed a lawsuit against seven
utilities, including SIGECO.  The USEPA alleges that,
beginning in 1992, SIGECO violated the Clean Air Act by: (i)
making modifications to its Culley Generating Station in
Yankeetown, Indiana without obtaining required permits; (ii)
making major modifications to the Culley Generating Station
without installing the best available emission control
technology; and (iii) failing to notify the USEPA of the
modifications.  In addition, the lawsuit alleges that the
modifications to the Culley Generating Station required
SIGECO to begin complying with federal new source
performance standards.

SIGECO believes it performed only maintenance, repair and
replacement activities at the Culley Generating Station, as
allowed under the Clean Air Act.  Because proper maintenance
does not require permits, application of the best available
emission control technology, notice to the USEPA, or
compliance with new source performance standards, SIGECO
believes that the lawsuit is without merit, and intends to
vigorously defend the lawsuit.

The lawsuit seeks fines against SIGECO in the amount of
$27,500 per day per violation.  The lawsuit does not specify
the number of days or violations the USEPA believes
occurred.  The lawsuit also seeks a court order requiring
SIGECO to install the best available emissions technology at
the Culley Generating Station. If the USEPA is successful in
obtaining an order, SIGECO estimates that it would incur
capital costs of approximately $40 million to $50 million
complying with the order.  In the event that SIGECO is
required to install system-wide Nox emission control
equipment, as a result of the Nox SIP call issue, the
majority of the $40 million to $50 million for best
available emissions technology at Culley Generating Station
would be included in the $100 million expenditure,
previously discussed

The USEPA has also issued an administrative notice of
violation to SIGECO making the same allegations, but
alleging that violations began in 1977.

While it is possible that SIGECO could be subjected to
criminal penalties if the Culley Generating Station
continues to operate without complying with the new source
performance standards and the allegations are determined by
a court to be valid, SIGECO believes such penalties are
unlikely as EPA and the electric utility industry have a
bonafide dispute over the proper interpretation of the Clean
Air Act.  Consequently, SIGECO anticipates at this time that
the plant will continue to operate while the matter is being
decided.

15.  Affiliate Transactions

The obligations of Vectren Capital Corp. (Capital Corp.), which
provides financing for the utility companies and its non-utility
subsidiaries, are subject to a support agreement between the
company and Capital Corp., under which the company has agreed to
make payments of interest and principal on Capital Corp.'s
securities in the event of default. At March 31, 2000, Capital
Corp. had $146.4 million in notes payable. Under the terms of
the support agreement in addition to the cash flow of cash
dividends paid to the company by any of its consolidated
subsidiaries, the non-utility assets of the company are
available as recourse to holders of Capital Corp.'s securities.

ProLiance began providing natural gas supply and related
services to Indiana Gas effective April 1, 1996.  Indiana Gas'
purchases from ProLiance for resale and for injections into
storage for the three- and twelve-month periods ended March 31,
2000, totaled $66.6 million and $235.8 million, respectively.
Indiana Gas' purchases from ProLiance for the three- and twelve-
month periods ended March 31, 1999, totaled $71.7 million and
$226.0 million, respectively.

ProLiance has a standby letter of credit facility with a bank
for letters up to $30 million. This facility is secured in part
by a support agreement from Indiana Energy.  Letters of credit
outstanding at March 31, 2000 totaled $6.4 million.

CIGMA, LLC provides materials acquisition and related services
that are used by the Indiana Gas.  Indiana Gas' purchases of
these services during the three- and twelve-month periods ended
March 31, 2000 totaled $3.8 million and $18.0 million,
respectively.  Indiana Gas' purchases of these services during
the three- and twelve-month periods ended March 31, 1999 totaled
$4.3 million and $16.2 million, respectively.

Vectren is a two-thirds guarantor of certain surety bond
obligations of Energy Systems Group, LLC.  Vectren's share
totaled $43.8 million at March 31, 2000.

Amounts owed to unconsolidated affiliates totaled $17.1
million and $20.0 million at March 31, 2000 and 1999,
respectively, and are included in Accounts Payable on the
Consolidated Balance Sheets.

16.  Segment Reporting

Vectren adopted SFAS No. 131 "Disclosure about Segments of
an Enterprise and Related Information" through its
consolidation of Indiana Energy and SIGCORP. SFAS No. 131
establishes standards for the reporting of information about
operating segments in financial statements and disclosures
about products, services and geographical areas.  Operating
segments are defined as components of an enterprise for
which separate financial information is available and
evaluated regularly by the chief operating decision-makers
in deciding how to allocate resources and in the assessment
of performance.

The operating segments of Vectren are defined as (1) Gas
Utility Services, (2) Electric Utility Services, and (3) Non-
regulated Operations.



                           Three Months          Twelve Months
                          Ended March 31         Ended March 31
                         2000(1)      1999     2000(1)       1999
                                                 
Operating Revenues:
   Gas Utility
      Services          $  200,845 $  191,182  $  509,236  $  485,393
   Electric Utility
      Services              72,990     70,987     309,572    303,625
   Non-regulated
      Operations           102,400     63,492     344,987    269,034
  Intersegment
Eliminations               (16,791)    (4,628)    (56,967)   (47,293)
   Total                   359,444    321,033   1,106,828  1,010,759


Net Income:
   Gas Utility
      Services              10,222     26,825      17,009     35,711
   Electric Utility          2,607      9,410      35,017     37,775
      Services
   Non-regulated
      Operations            22,326     33,529      46,339     58,224
   Intersegment
Eliminations               (13,030)   (29,041)    (26,215)   (43,955)
   Total                    22,125     40,723      72,150     87,755




(1)  The 2000 amounts include merger costs expensed by
  Vectren at March 31 of $27.2 million ($19.3 million after
  tax).

17.  New Accounting Standards

In June 1998, the FASB issued SFAS No. 133, Accounting for
Derivative Instruments and Hedging Activities. The statement
establishes accounting and reporting standards requiring
that every derivative instrument, including certain
derivative instruments embedded in other contracts, be
recorded in the balance sheet as either an asset or
liability measured at its fair value. The statement requires
that changes in the derivative's fair value be recognized
currently in earnings unless specific hedge accounting
criteria are met. Special accounting for qualifying hedges
allows a derivative's gains and losses to offset related
results on the hedged item in the income statement, and
requires that a company must formally document, designate,
and assess the effectiveness of transactions that receive
hedge accounting. In June 1999, the FASB issued SFAS 137,
which defers the effective date of SFAS 133.  ProLiance
utilizes derivative instruments to manage pricing decisions,
minimize the risk of price volatility, and minimize price
risk exposure in the energy markets. SFAS 133 is now
effective for ProLiance and Vectren in 2001. ProLiance has
not yet quantified the impact of adopting this statement on
its financial position or results of operations.  Likewise,
Vectren has not quantified the impact of adopting this
statement on its financial position or results or
operations.



                    VECTREN CORPORATION
                  AND SUBSIDIARY COMPANIES

   Item 2.  MANAGEMENT DISCUSSION AND ANALYSIS OF RESULTS
            OF OPERATIONS AND FINANCIAL CONDITION

Results of Operation

                         Net Income

Consolidated net income was $22.1 million for the three-
month period ended March 31, 2000.  Consolidated net income
before merger related charges was $41.4 million for the
three-month period ended March 31, 2000, as compared to the
net income of $40.7 million for the same period in 1999.

                        Merger Costs

Merger costs incurred at March 31, 2000 totaled $27.2
million pre-tax, $19.3 net of tax.  Vectren expects to
realize net merger savings of nearly $200 million over ten
years from the elimination of duplicate corporate and
administrative programs and greater efficiencies in
operations, business processes and purchasing.  These costs
relate primarily to transaction costs, severance and other
merger integration activities. The continued merger
integration activities, which will contribute to the merger
savings, will be substantially complete by 2001.

  Utility Margin (Operating Revenues Less Cost of Fuel for
                    Electric Generation,
              Purchased Power and Cost of Gas)

Electric utility margin for the quarter ended March 31, 2000
was $52.9 million as compared to $52.1 million for the same
period last year.  Increased sales of non-firm wholesale
power and sales to industrial customers was the primary
reason for the increase in electric margin. Warmer weather
during the current quarter compared to normal and the year-
ago period contributed to a 9% decrease in residential
electric sales. Gas utility margin for the quarter ended
March 31, 2000 was $82.3 million compared to $87.7 million
for the same period last year.  Gas margin was lower due to
weather being 10% warmer than the year-ago period and 17%
warmer than normal.  Residential gas sales declined 10%
compared to the prior year period.  These decreases in gas
margin were partially offset by additional residential and
commercial customer growth.

Electric utility margin for the twelve-month period ended
March 31, 2000, was $221.3 million compared to $215.3
million for the same period last year.  The $6.0 million
increase in margin reflected a 5% increase in retail and
firm wholesale electric sales, primarily due to stronger
industrial and commercial sales.  Summer temperatures were
6% below normal for the current period.  The twelve-month
period ended March 31, 1999 experienced summer temperatures
that were 16% warmer than normal.

Gas utility margin for the twelve-month period ended March
31, 2000, was $227.8 million compared to $224.9 million for
the same period last year.  The increase is primarily
attributable to the addition of new residential and
commercial customers.  Temperatures were 17% warmer than
normal during the current twelve month period and 13% warmer
than normal for the twelve months ending March 31, 1999.

Total electric sales during the quarter ended March 31, 2000
rose 3.4% (57,589 MWh) compared to the prior year period and
were .7% (49,850 MWh) greater during the current twelve-
month period than a year ago.  Total gas system throughput
(combined sales and transportation) decreased 4.6% (2.7
MMDth) for the quarter and 1.2% (1.8 MMDth) for the twelve-
month period. Vectren's rates for gas transportation
generally provide for the same margins as are earned on the
sale of gas under its applicable sales tariffs.
Approximately one-half of total gas system throughput
represents gas used for space heating and is affected by
weather.



Operating Expenses (excluding Cost of Fuel for Electric
Generation, Purchased Power, Cost of Gas and Energy Services
and Other)

Other operating expenses increased $1.6 million, or 3.6%,
for the three-month period ended March 31, 2000, when
compared to the same period a year ago.  The increase is
primarily attributed to a rise in utility operating expenses
due to the reduction of restructuring costs at Indiana Gas
in the amount of $1.3 million. For the twelve months ending
March 31, 2000, other operating expenses rose $5.6 million
(3.0%) to $191.2 million due to general operation expenses
and to the prior period reduction in restructuring charges
at Indiana Gas.

Depreciation and amortization increased $1.4 million or 6.8%
and $5.8 million or 7.0% for both the three-month and twelve-
month periods due primarily to additions to plant to serve new
customers and to maintain dependable service to existing
customers.

Taxes other than income taxes increased $3.0 million during
the recent twelve-month period  due to higher gross receipts
and property tax expense.

                        Other Income

Equity in earnings of unconsolidated affiliates decreased $1.7
million and $3.1 million, respectively for the three-month and
twelve-month periods ended March 31, 2000, due primarily to
lower earnings recognized from Vectren's energy marketing
affiliate, ProLiance Energy, LLC (ProLiance).  This reduction
in earnings is primarily attributed to ProLiance's net
position on financial instruments held to hedge storage
inventories and the restructuring of several transportation
contracts to provide less seasonality in Proliance's earnings,
the majority of which are timing..

Other - net increased $10.5 million and $14.4 million,
respectively, for the three-month and twelve-month periods
ended March 31, 2000, compared to the prior year periods due
to the $8.0 million pre-tax gain on the SIGECOM investment
restructuring and increased  investments earnings at Southern
Indiana Properties, Inc. (SIPI)

                      Interest Expense

Interest expense increased by $2.1 million and $5.0 million,
respectively, for the three-month and twelve-month periods
ended March 31, 2000, when compared to the same period a
year ago due primarily to higher average interest rates on
utility debt and additional debt required for SIPI's
increased financial investment activities .

                        Income Taxes

Federal and state income taxes declined $8.6 million and
$7.3 million for the three-month and twelve-month periods
ended March 31, 2000, due primarily to lower earnings
resulting from  merger costs of $27.2 million.

                   Other Operating Matters

                   The Merger Transaction

Vectren Corporation (Vectren) is an Indiana corporation that was
organized on June 10, 1999 solely for the purpose of effecting the
merger of Indiana Energy, Inc. (Indiana Energy) and SIGCORP, Inc.
(SIGCORP) with and into Vectren and carrying on the combined business
of Indiana Energy and SIGCORP.  On March 31, 2000 the merger of
Indiana Energy with SIGCORP and into Vectren was consummated with a
tax-free exchange of shares and has been accounted for as a pooling
of interests.  The common shareholders of SIGCORP received one and
one-third shares of Vectren common stock for each SIGCORP common
share and Indiana Energy common shareholders received one share of
Vectren common stock for each Indiana Energy common share, resulting
in the issuance of 61.3 million shares of Vectren common stock.  The
preferred stock and debt securities of Indiana Energy's and SIGCORP's
utility subsidiaries were not affected by the merger.

Vectren is public utility holding company with two operating public
utilities, Indiana Gas Company, Inc. (Indiana Gas) and Southern
Indiana Gas and Electric Company (SIGECO).  Indiana Gas and its
subsidiaries provide natural gas and transportation services to a
diversified base of customers in 311 communities in 49 of Indiana's
92 counties.  SIGECO provides generation, transmission, distribution
and the sale of electric power and the distribution and sale of
natural gas to communities and counties in southwestern Indiana.

Vectren is also involved in non-regulated activities through
its subsidiaries and investments in joint ventures:  Vectren
Enterprises, Inc., Vectren Energy Services, Inc., Vectren
Financial Group, Inc.,  Vectren Generation Services, Inc.,
Vectren Resources, LLC, Vectren Utility Services, Inc.,
Vectren Ventures, Inc.,  and Vectren Communications, Inc.
These non-regulated activities provide energy,
telecommunications and finance services throughout the
Midwest.

The merger was conditioned, among other things, upon the
approvals of the shareholders of each company and customary
regulatory approvals. On December 17, 1999, the merger was
approved by the shareholders of each company. On December
20, 1999, the Federal Energy Regulatory Commission (FERC)
issued an order approving the proposed merger. In approving
the merger, the FERC concluded that the merger was in the
public interest and would not adversely affect competition,
rates or regulation. On January 18, 2000, the Department of
Justice informed the Companies that it had concluded its
review of their Hart Scott Rodino notification filings and
would take no further action. On March 8, 2000, approval was
received from the (SEC) under the Public Utility Holding
Company Act to consummate the merger.  The merger was
therefore completed on March 31, 2000.


Indiana Gas Company, Inc. and Southern Indiana Gas and
Electric Company will operate as separate subsidiaries of
Vectren.




        Acquisition of the Gas Distribution Assets of
             The Dayton Power and Light Company

On December 15, 1999,  Indiana Energy announced that the
board of directors had approved a definitive agreement under
which Indiana Energy would  acquire the natural gas
distribution assets of The Dayton Power and Light Company.
The acquisition, with a purchase price of $425 million, is
expected to be funded with commercial paper (back-stopped by
a committed bank credit facility)which will be replaced over
time with permanent financing. This transaction is
conditioned upon the approval of several regulatory bodies.
Management hopes to complete the transaction by mid year
2000.


                    ProLiance Energy, LLC

ProLiance Energy, LLC (ProLiance), a 50% owned non-regulated
marketing affiliate of Vectren, began providing natural gas
and related services to Indiana Gas and Citizens Gas and
Coke Utility (Citizens Gas) effective April 1, 1996.

The sale of gas and provision of other services to Indiana
Gas by ProLiance is subject to regulatory review through the
quarterly gas cost adjustment process administered by the
IURC.

On September 12, 1997, the Indiana Utility Regulatory
Commission (IURC) issued a decision finding the gas supply
and portfolio administration agreements between ProLiance
and Indiana Gas and ProLiance and Citizens Gas (the gas
supply agreements) to be consistent with the public
interest. The IURC's decision reflected the significant gas
cost savings to customers obtained by ProLiance's services
and suggested that all material provisions of the agreements
between ProLiance and the utilities are reasonable.
Nevertheless, with respect to the pricing of gas commodity
purchased from ProLiance and two other pricing terms, the
IURC concluded that additional review in the gas cost
adjustment (GCA) process would be appropriate and directed
that these matters be considered further in the pending,
consolidated GCA proceeding involving Indiana Gas and
Citizens Gas. The IURC has not yet established a schedule
for conducting these additional proceedings.

The IURC's September 12, 1997, decision was appealed to the
Indiana Court of Appeals by certain Petitioners, including
the Indiana Office of Utility Consumer Counselor, the
Citizens Action Coalition of Indiana, and a small group of
large-volume customers. On October 8, 1998, the Indiana
Court of Appeals issued a decision which reversed and
remanded the case to the IURC with instructions that the gas
supply agreements be disapproved. The basis for the decision
was that because the gas supply agreements provide for index
based pricing of gas commodity sold by ProLiance to the
utilities, the gas supply agreements should have been the
subject of an application for approval of an alternative
regulatory plan under Indiana statutory law.

On April 22, 1999, the Indiana Supreme Court granted a
petition for transfer of the case and will now consider the
appeal of the IURC's decision and issue its own decision on
the merits of the appeal at a later date.  By granting
transfer, the Supreme Court has vacated the Court of
Appeals' decision.

If the Supreme Court reverses the IURC's decision , the case
will be remanded to the IURC for further proceedings
regarding the public interest in the gas supply agreements.
If the Supreme Court affirms the IURC's decision, as
described above, the reasonableness of certain of the gas
costs incurred by Indiana Gas under the gas supply
agreements will be further reviewed by the IURC in the
consolidated GCA proceeding. The existence of significant
benefits to the utilities and their customers resulting from
ProLiance's services has not been challenged on appeal.
Indiana Gas and Citizens Gas are continuing to utilize
ProLiance for their gas supplies.

On or about August 11, 1998, Indiana Gas, Citizens Gas and
ProLiance each received a Civil Investigative Demand ("CID")
from the United States Department of Justice requesting
information relating to Indiana Gas' and Citizens Gas'
relationship with and the activities of ProLiance. The
Department of Justice issued the CID to gather information
regarding ProLiance's formation and operations, and to
determine if trade or commerce has been restrained. Indiana
Gas has provided all information requested and management
continues to believe that there are no significant issues in
this matter.

Indiana Gas continues to record gas costs in accordance with
the terms of the ProLiance contract and Vectren continues to
record its proportional share of ProLiance's earnings.
Pretax income of $3.4 million and $5.0 million, was
recognized as ProLiance's contribution to earnings in the
first quarter of fiscal year 2000 and 1999, respectively.
Pretax earnings recognized from ProLiance for the twelve
months ended March 31, 2000, totaled $5.1 million compared
to $8.1 million for the same period last year. Earnings
recognized from ProLiance are included in Equity in Earnings
of Unconsolidated Affiliates on the Consolidated Statements
of Income.

At March 31, 2000, Vectren  has reserved approximately $1.6
million of ProLiance earnings after tax. Total after-tax
ProLiance earnings recognized to date approximate $21.6
million.  This amount includes earnings from all of
ProLiance's business activities, and therefore is believed
to be a conservative estimate of the upper risk limit.
Resolution of the above proceedings may also impact future
operations and earnings contributions from ProLiance. Based
on the IURC's findings described above, management believes
the ProLiance issues may be resolved near the levels that
are already being reserved, and therefore, while these
proceedings are pending, does not anticipate changing the
level at which it reserves ProLiance earnings. However, no
assurance of this outcome can be provided.

                    Environmental Matters

Manufactured Gas Plants
Indiana Gas is currently conducting environmental
investigations and work at many of the 26 sites that were
the locations of former manufactured gas plants. It has been
recovering the costs of the investigations and work from
insurance carriers and other potentially responsible parties
(PRPs). The IURC has determined that these costs are not
recoverable from utility customers.

Indiana Gas has PRP agreements in place covering 19 of the
26 sites.  The agreements provide for coordination of
efforts and sharing of investigation and clean-up costs
incurred and to be incurred at the sites. These agreements
limit Indiana Gas' share of past and future response costs
at these 19 sites to between 20 and 50 percent.  Based on
the agreements, Indiana Gas has accrued its proportionate
share of the estimated cost related to work not yet
performed.

In early 1999, Indiana Gas filed a complaint in Indiana
state court to continue its pursuit of insurance coverage
from four insurance carriers. As of March 31, 2000,
settlement agreements were  reached with each of these
insurers and the litigation was dismissed.

These environmental matters have had no material impact on
earnings since costs recorded to date approximate PRP
recoveries and insurance settlements received. While Indiana
Gas has recorded all costs which it presently expects to
incur in connection with remediation activities, it is
possible that future events may require some level of
additional remedial activities which are not presently
foreseen.

Clean Air Act
In October, 1997, the United States Environmental Protection
Agency (USEPA) proposed a rulemaking that would require
uniform NOx emissions reductions of 85 percent by utilities
and other large sources in a 22-state region spanning areas
in the Northeast, Midwest, Great Lakes, Mid-Atlantic and
South. This rule is referred to as the "NOx SIP call".  The
USEPA provided each state a proposed budget of allowed NOx
emissions, a key ingredient of ozone, which requires a
significant reduction of such emissions.  Under that budget,
utilities may be required to reduce NOx emissions to a rate
of 0.15 lb/mmBtu from levels already imposed by Phase I and
Phase II of the Clean Air Act Amendments of 1990.
Midwestern states (the alliance) have been working together
to determine the most appropriate compliance strategy as an
alternative to the USEPA proposal.  The alliance submitted
its proposal, which calls for a smaller, phased in reduction
of NOx levels, to the USEPA and the Indiana Department of
Environmental Management in June 1998.

In July 1998, Indiana submitted its proposed plan to the
USEPA in response to the USEPA's proposed new NOx rule and
the emissions budget proposed for Indiana.  The Indiana
plan, which calls for a reduction of NOx emissions to a rate
of 0.25 lb/mmBtu by 2003, is less stringent than the USEPA
proposal but more stringent than the alliance proposal.

In October 27, 1998 USEPA issued a final rule "Finding of
Significant Contribution and Rulemaking for Certain States
in the Ozone Transport Assessment Group Region for Purposes
of Reducing Regional Transport of Ozone," (63 Fed. Reg.
57355). The final rule requires that 23 states and
jurisdictions must file revised state implementation plans
("SIPs") with EPA by no later than September 30, 1999, which
was essentially unchanged from its October 1997, proposed
rule.  The USEPA has encouraged states to target utility
coal-fired boilers for the majority of the reductions
required, especially NOx emissions.  Northeastern states
have claimed that ozone transport from midwestern states
(including Indiana) is the primary reason for their ozone
concentration problems.  Although this premise is challenged
by others based on various air quality modeling studies,
including studies commissioned by the USEPA, the USEPA
intends to incorporate a regional control strategy to reduce
ozone transport.  The USEPA's final ruling is being
litigated in the federal courts by approximately ten
midwestern states, including Indiana.



During the second quarter of 1999, the USEPA lost two
federal court challenges to key air-pollution control
requirements.  In the first ruling by the U.S. Circuit Court
of Appeals for the District of Columbia on May 14, 1999, the
Court struck down the USEPA's attempt to tighten the one-
hour ozone standard to an eight-hour standard and the
attempt to tighten the standard for particulate emissions,
finding the actions unconstitutional.  In the second ruling
by the same Court on May 25, 1999, the Court placed an
indefinite stay on the USEPA's attempts to reduce the
allowed NOx emissions rate from levels required by the Clean
Air Act Amendments of 1990.  The USEPA appealed both court
rulings.  On October 29, 1999, the Court refused to
reconsider its May 14, 1999 ruling.

On March 3, 2000,  the D.C. Circuit of Appeals upheld the
USEPA's October 27, 1998 final rule requiring 23 states and
the District of Columbia to file revised SIPs with EPA by no
later than September 30, 1999.  Numerous petitioners,
including several states, have filed a petition for
rehearing with the U.S. Court of Appeals for the District of
Columbia in Michigan v. EPA. Petitioners seek rehearing
primarily on two issues: (1) EPA's consideration of the cost-
effectiveness of NOx controls, rather than air quality
effects, as the basis for determining the amount of each
State's emissions that "contribute[s] significantly to non-
attainment" of the ozone National Ambient Air Quality
Standards ("NAAQS") in another State; and (2) EPA's choice
of $2000/ton-removed as the cost-effectiveness cut-off
point.

The proposed NOx emissions budget for Indiana stipulated in
the USEPA's final ruling requires a 36% reduction in total
NOx emissions from Indiana.  The ruling could require SIGECO
to lower its system-wide emissions by approximately 70%.
Depending on the level of system-wide emissions reductions
ultimately required, and the control technology utilized to
achieve the reductions, the estimated construction costs of
the control equipment could reach $100 million, and related
additional operation and maintenance expenses could be an
estimated $8 million to $10 million, annually.  Under the
USEPA implementation schedule, the emissions reductions and
required control equipment must be implemented and in place
by May 15, 2003.

Approximately 12 months ago, the USEPA initiated an
investigation under Section 114 of the Clean Air Act (the
Act) of SIGECO's coal-fired electric generating units in
commercial operation by 1977 to determine compliance with
environmental permitting requirements related to repairs,
maintenance, modifications and operations changes.  The
focus of the investigation was to determine whether new
source performance standards should be applied to the
modifications and whether the best available control
technology was, or should have been, used.  Numerous other
electric utilities were, and are currently, being
investigated by the USEPA under an industry-wide review for
similar compliance.  SIGECO responded to all of the USEPA's
data requests during the investigation.  In July 1999,
SIGECO received a letter from the Office of Enforcement and
Compliance Assurance of the USEPA discussing the industry-
wide investigation, vaguely referring to the investigation
of SIGECO and inviting SIGECO to participate in a discussion
of the issues.  No specifics were noted; furthermore, the
letter stated that the communication was not intended to
serve as a notice of violation.  Subsequent meetings were
conducted in September and October with the USEPA and
targeted utilities, including SIGECO, regarding potential
remedies to the USEPA's general allegations.

On November 3, 1999, the USEPA filed a lawsuit against seven
utilities, including SIGECO.  The USEPA alleges that,
beginning in 1992, SIGECO violated the Clean Air Act by: (i)
making modifications to its Culley Generating Station in
Yankeetown, Indiana without obtaining required permits; (ii)
making major modifications to the Culley Generating Station
without installing the best available emission control
technology; and (iii) failing to notify the USEPA of the
modifications.  In addition, the lawsuit alleges that the
modifications to the Culley Generating Station required
SIGECO to begin complying with federal new source
performance standards.

SIGECO believes it performed only maintenance, repair and
replacement activities at the Culley Generating Station, as
allowed under the Clean Air Act.  Because proper maintenance
does not require permits, application of the best available
emission control technology, notice to the USEPA, or
compliance with new source performance standards, SIGECO
believes that the lawsuit is without merit, and intends to
defend the lawsuit vigorously.

The lawsuit seeks fines against SIGECO in the amount of
$27,500 per day per violation.  The lawsuit does not specify
the number of days or violations the USEPA believes
occurred.  The lawsuit also seeks a court order requiring
SIGECO to install the best available emissions technology at
the Culley Generating Station. If the USEPA is successful in
obtaining an order, SIGECO estimates that it would incur
capital costs of approximately $40 million to $50 million
complying with the order. In the event that SIGECO is
required to install system-wide Nox emission control
equipment, the majority of the $40 million to $50 million
for best available emissions technology at Culley Generating
Station would be included in the $100 million expenditure,
previously discussed.

The USEPA has also issued an administrative notice of
violation to SIGECO making the same allegations, but
alleging that violations began in 1977.

While it is possible that SIGECO could be subjected to
criminal penalties if the Culley Generating Station
continues to operate without complying with the new source
performance standards and the allegations are determined by
a court to be valid, SIGECO believes such penalties are
unlikely as EPA and the electric utility industry have a
bonafide dispute over the proper interpretation of the Clean
Air Act.  Consequently, SIGECO anticipates at this time that
the plant will continue to operate while the matter is being
decided.

                     The Year 2000 Issue

Vectren uses various software, systems and technology that
could have been affected by the date change in 2000.  All
identification, testing and replacement or remediation of
such software, systems and technology at Vectren was
completed by December 31, 1999.  No significant
noncompliance issues have been encountered in 2000 and
Vectren anticipates that no such issues will be encountered.
Vectren estimates the expense of Year 2000-readiness
modifications to existing systems or  replacements treated
as expense incurred totaled approximately $3.2 million.

                  New Accounting Standards

In June 1998, the FASB issued SFAS No. 133, Accounting for
Derivative Instruments and Hedging Activities. The statement
establishes accounting and reporting standards requiring
that every derivative instrument, including certain
derivative instruments embedded in other contracts, be
recorded in the balance sheet as either an asset or
liability measured at its fair value. The statement requires
that changes in the derivative's fair value be recognized
currently in earnings unless specific hedge accounting
criteria are met. Special accounting for qualifying hedges
allows a derivative's gains and losses to offset related
results on the hedged item in the income statement, and
requires that a company must formally document, designate,
and assess the effectiveness of transactions that receive
hedge accounting. In June 1999, the FASB issued SFAS 137,
which defers the effective date of SFAS 133.  ProLiance
utilizes derivative instruments to manage pricing decisions,
minimize the risk of price volatility, and minimize price
risk exposure in the energy markets. SFAS 133 is now
effective for ProLiance and Vectren in 2001. ProLiance has
not yet quantified the impact of adopting this statement on
its financial position or results of operations.  Likewise,
Vectren has not quantified the impact of adopting this
statement on its financial position or results or
operations.

               Liquidity and Capital Resources

Vectren's capitalization objectives, which are 45-60 percent
common  and preferred equity and 40-55 percent long-term
debt. These objectives may have varied, and will vary, from
time to time, depending on particular business opportunities
and seasonal factors that affect the company's operation.
Vectren's common equity component was 57 percent of its
total capitalization at March 31, 2000.

The acquisition of Dayton Power and Light Co., at a cost of
$425 million, is expected to be funded with commercial paper
(back-stopped by a committed bank credit facility)y that
will be replaced over time with permanent financing.

New construction, normal system maintenance and
improvements, and information technology investments needed
to provide service to a growing customer base will continue
to require substantial expenditures. Capital expenditures
for fiscal 2000 are estimated at $135 million of which $30.8
million have been expended during the three-month period
ended March 31, 2000.  For the twelve months ended March 31,
2000, capital expenditures totaled $132.1 million.

Short-term cash working capital is required primarily to
finance customer accounts receivable, unbilled utility
revenues resulting from cycle billing, gas in underground
storage, prepaid gas delivery services, capital expenditures
and investments until permanently financed. Short-term
borrowings tend to be greatest during the heating season
when accounts receivable and unbilled utility revenues are
at their highest.

On March 1, 2000, the fixed rate 7.25% $22,500,000 Pollution
Control Series A Bonds of SIGECO, due March 1, 2014, were
converted to a Municipal Auction Rates Series.  The interest
rate, currently 4.35%, will be set every 32 days through the
municipal bond auction process.

On March 1, 2000, the interest rate on $31,500,000 of
Adjustable Rate Pollution Control bonds of SIGECO, due March
1, 2025,  was changed from 3.00% to 4.30%.  The new interest
rate will be fixed through February 29, 2001.  Also on March
1, 2000, the interest rate on $22,200,000 of Adjustable Rate
Pollution Control bonds of SIGECO, due March 1, 2020, was
changed from 3.05% to 4.45%.  The new interest rate will
also be fixed through February 29, 2001.  For financial
statement presentation, the $53,700,000 of Adjustable Rate
Pollution Control bonds are shown as a current liability.

On December 23, 1999 SIGCORP Capital, Inc. (now Vectren
Capital Corporation) established a $100 Million Committed
Bank Credit Facility.  This facility, syndicated among five
banks, replaced several uncommitted lines of credit and is
used to fund non-regulated operations.  At March 31, 2000,
there was $90.1 million drawn against this facility.  In
addition, there was $56.3 million in other notes payable
outstanding.

Vectren expects the majority of the utility construction
requirements and debt security redemptions to be provided by
internally generated funds.

Indiana Gas' and SIGECO's credit ratings on outstanding debt
for the three months ended March 31, 2000 was AA-/Aa2 and
AA/Aa2, respectively.

                 Forward-Looking Information

A "safe harbor" for forwarding-looking statements is
provided by the Private Securities Litigation Reform Act of
1995 (Reform Act of 1995).  The Reform Act of 1995 was
adopted to encourage such forward-looking statements without
the threat of litigation, provided those statements are
identified as forward-looking and are accompanied by
meaningful cautionary statements identifying important
factors that could cause the actual results to differ
materially from those projected in the statement.  Certain
matters described in Management's Discussion and Analysis of
Results of Operations and Financial Position, including but
not limited to, Vectren Corporation's earnings growth
strategy, ProLiance, the acquisition of gas distribution
assets of the Dayton Power and Light Company  and Year 2000
issues, are forward-looking statements.  Such statements are
based on management's beliefs, as well as assumptions made
by and information currently available to management.  When
used in this filing, the words "believe," "anticipate,"
"endeavor," "estimate," "expect," "objective," "projection,"
"forecast," "goal," and similar expressions are intended to
identify forward-looking statements.  In addition to any
assumptions and other factors referred to specifically in
connection with such forward-looking statements, factors
that could cause Vectren Corporation and its subsidiaries'
actual results to differ materially from those contemplated
in any forward-looking statements included, among others,
the following:

    Factors affecting utility operations such as unusual
  weather conditions; catastrophic weather-related damage;
  unusual maintenance or repairs; unanticipated changes to
  fossil fuel costs; unanticipated changes to gas supply
  costs, or availability due to higher demand, shortages,
  transportation problems or other developments; environmental
  or pipeline incidents; transmission or distribution
  incidents; unanticipated changes to electric energy supply
  costs, or availability due to demand, shortages,
  transmission problems or other developments; or electric
  transmission or gas pipeline system constraints.

    Increased competition in the energy environment
  including effects of industry restructuring and unbundling.

    Regulatory factors such as unanticipated changes in
  rate-setting policies or procedures, recovery of investments
  and costs made under traditional regulation, and the
  frequency and timing of rate increases.

    Financial or regulatory accounting principles or
  policies imposed by the Financial Accounting Standards
  Board, the Securities and Exchange Commission (Commission),
  the Federal Energy Regulatory Commission, state public
  utility commissions, state entities which regulate natural
  gas transmission, gathering and processing, and similar
  entities with regulatory oversight.

    Economic conditions including inflation rates and
  monetary fluctuations.

    Changing market conditions and a variety of other
  factors associated with physical energy and financial
  trading activities including, but not limited to, price,
  basis, credit, liquidity, volatility, capacity, interest
  rate, and warranty risks.

    Availability or cost of capital, resulting from changes
  in Vectren Corporation and its subsidiaries, interest rates,
  and securities ratings or market perceptions of the utility
  industry and energy-related industries.

    Employee workforce factors including changes in key
  executives, collective bargaining agreements with union
  employees, or work stoppages.

    Legal and regulatory delays and other obstacles
  associated with mergers, acquisitions, and investments in
  joint ventures.

    Costs and other effects of legal and administrative
  proceedings, settlements, investigations, claims, and other
  matters, including, but not limited to, those described in
  the Other Operating Matters section of Management's
  Discussion and Analysis of Results of Operations and
  Financial Condition.

    Changes in federal, state or local legislature
  requirements, such as changes in tax laws or rates,
  environmental laws and regulations.

Vectren Corporation and its subsidiaries undertake no
obligation to publicly update or revise any forward-looking
statements, whether as a result of changes in actual
results, changes in assumptions, other factors affecting
such statements.

Item 3.  Quantitative and Qualitative Disclosures about
Market Risk

Vectren's debt portfolio contains a substantial amount of
fixed-rate long-term debt and, therefore, does not expose
the company to the risk of material earnings or cash flow
loss due to changes in market interest rates. On average,
less than 25% of the company's total debt portfolio
consists of short term notes and commercial paper that are
subject to fluctuations in market interest rates and other
seasonal factors.

ProLiance engages in energy hedging activities to manage
pricing decisions, minimize the risk of price volatility,
and minimize price risk exposure in the energy markets.
ProLiance's market exposure arises from storage inventory,
imbalances and fixed-price purchase and sale commitments
which are entered into to support ProLiance's operating
activities.  Currently, ProLiance buys and sells physical
commodities and utilizes financial instruments to hedge its
market exposure.  However, net open positions in terms of
price, volume and specified delivery point do occur.
ProLiance manages open positions with policies which limit
its exposure to market risk and require reporting potential
financial exposure to its management and its members.  As a
result of ProLiance's risk management policies, Vectren
does not believe that ProLiance's exposure to market risk
will result in material earnings or cash flow loss to the
company.

SIGECO, a Vectren subsidiary, utilizes contracts for the
forward sale of electricity to effectively manage the
utilization of its available generating capability.  Such
contracts include forward physical contracts for wholesale
sales of its generating capability, during periods when
SIGECO's available generating capability is expected to
exceed the demands of its retail, or native load,
customers.  To minimize the risk related to these forward
contracts, SIGECO may utilize call option contracts to
hedge against the unexpected loss of its generating
capability during periods of heavy demand.  SIGECO also
utilizes forward physical contracts for the wholesale
purchase of generating capability to resell to other
utilities and power marketers through non-firm "buy-resell"
transactions where the sale and purchase prices of power
are concurrently set.  As of March 31, 2000 management
believes exposure from these positions was not material.

SIGCORP Energy Services, Inc. utilizes forward physical
contracts for both the purchase and sale of natural gas to
its customers, primarily through "back-to-back"
transactions where the sale and purchase prices of natural
gas are concurrently set. Management believes that exposure
from these positions was not material. SIGCORP Energy
Services, Inc. sells fixed-price and capped-price products,
and reduces its market price risk through the use of fixed-
price supplier contracts and storage assets.

Vectren is also exposed to counterparty credit risk when a
supplier defaults upon a contract to pay or deliver the
commodity.  To mitigate risk, procedures to determine and
monitor the creditworthiness of counterparties have been
established.

At March 31, 2000, the company was not engaged in other
contracts which would cause exposure to the risk of material
earnings or cash flow loss due to changes in market
commodity prices, foreign currency exchange rates, or
interest rates.
                       VECTREN CORPORATION
                    AND SUBSIDIARY COMPANIES

                      PART II - OTHER ITEM


Item 1.  Legal Proceedings

See Note 8 of the Notes to the Consolidated Financial Statements
for discussion of litigation matters relating to the gas supply
and portfolio administration agreements between ProLiance and
Indiana Gas and ProLiance and Citizens Gas.

See Note 14 of the Notes to the Consolidated Financial Statements
for discussion of the litigation matters relating to USEPA
allegations that SIGECO violated the Clean Air Act.

Item 4.  Submission of Matters to a Vote of Security Holders

None

Item 6.  Exhibits and Reports on Form 8-K



Exhibit                          Description
Number
    
2.1    Agreement and Plan of Merger dated June 11, 1999,
       among Indiana Energy, Inc., SIGCORP, Inc. and Vectren
       Corporation (Incorporated by reference to Exhibit 2
       to the Current Report on Form 8-K of Indiana Energy,
       Inc. (Commission file number 1-09091) filed June 15,
       1999).

2.2    Asset Purchase Agreement dated December 14, 1999
       between Indiana Energy, Inc. and Dayton Power and
       Light Co., Inc. and Number -3CHK with a commitment
       letter for a 364 - Day Credit Facility dated December
       16, 1999 (Incorporated by reference to Exhibit 2 and
       99.1 of Indiana Energy, Inc.'s (Commission File No. 1-
       90991) Current Report on Form 8-K filed December 28,
       1999.)

3.1    Amended and Restated Articles of Incorporation of
       Vectren Corporation effective March 31, 2000
       (Incorporated by reference to Exhibit 3 to the
       Current Report on Form 8-K of Vectren Corporation
       (Commission file number 1-15467) filed April 14,
       2000).

3.2    Amended and Restated Bylaws of Vectren Corporation
       effective March 31, 2000 (Incorporated by reference
       to Exhibit 3 to the Current Report on Form 8-K on
       Form 8-K of Vectren Corporation (Commission file
       number 1-15467) filed April 14, 2000).



27     Financial Data Schedule, filed herewith.



Form 8-K's

On January 27, 2000, Indiana Energy and Indiana Gas filed a
Current Report on Form 8-K with respect to the release of summary
financial information to the investment community regarding
Indiana Energy's consolidated results of operations, financial
position and cash flows for the three- and twelve- month periods
ended December 31, 1999.  Items reported included:

                    Item 5.   Other Events

                    Item 7.   Exhibits

                           100  Financial Analyst Report and
                           Press Release - First Quarter 2000

On January 27, 2000, Indiana Energy and Indiana Gas filed a
Current Report on Form 8-K with respect to an analyst
teleconference call, held on January 27, 2000.  Items reported
included:

                    Item 5.   Other Events

                    Item 7.   Exhibits

                           100.1     Analyst script
                           teleconference call dated January 27,
                           2000

On January 27, 2000, Indiana Energy filed a Current Report on
Form 8-K with respect to a consent form of Arthur Andersen, LLP.
Items reported included:

                    Item 5.   Other Events

                    Item 7.   Exhibits

                     23   Consent form of Arthur Andersen

On February 11, 2000, SIGCORP filed a Current Report on Form 8-K
with respect to the release of summary financial information to
the investment community regarding SIGCORP's consolidated results
of operations and financial position for the three- and twelve-
month periods ended December 31, 1999.  Items reported included:

                    Item 7.   Exhibits

                           99.1 Press Release dated February 2,
                           2000 announcing revenues and earnings
                           for the quarter and year ended
                           December 31, 1999

On February 28, 2000, SIGCORP and SIGECO jointly filed a Current
Report on Form 8-K filing audited financial statements of SIGCORP
and SIGECO prior to financing activities that occurred on March
1, 2000.  Items reported included:

                    Item 7.   Financial Statements and Exhibits

On March 24, 2000, Vectren filed a Current Report on Form 8-K
with respect to a presentation made to industry analysts.  Items
reported included:

                    Item 7.   Exhibits

                     99.1 Presentation to Industry Analysts


On April 27, 2000 Vectren Corporation filed a Current Report on
Form 8-K with respect to the release of summary financial
information to the investment community regarding Vectren
Corporation consolidated results of operation, financial position
and cash flows for the three-and twelve-month periods of March
31, 2000.  Items reported included:

                    Item 5.  Other Events

                    Item 7.  Exhibits

                            99-1 Press Release
                            99-2 Analyst Report-First Quarter 2000
                            99-3 Cautionary Statement for purposes
                                 of the "Safe Harbor" Provisions of
                                 the Private Securities Litigation
                                 Reform Act of 1995

On April 27, 2000 Vectren filed a Current Report on Form 8-K with
respect to an analyst teleconference call held on April 27, 2000.
Items reported included:

                    Item 5.  Other Events

                    Item 7.  Exhibits

                      99 Analyst script teleconference call dated
                         April 27, 2000




                         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.


                            VECTREN CORPORATION
                                Registrant




   May 15, 2000          /s/M. Susan Hardwick
                         M. Susan Hardwick
                         Vice President and Controller