CALIFORNIA ENERGY CO INC
8-K, 1994-09-30
STEAM & AIR-CONDITIONING SUPPLY
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                 Securities and Exchange Commission

                         Washington, DC  20549

                               Form 8-K

                            Current Report

                Pursuant to Section 13 to 15(d) of the
                     Securities Exchange Act 1934


                  Date of Report September 28, 1994  
                   (Date of earliest event reported)




                California Energy Company, Inc.                       
        (Exact name of registrant as specified in its charter)




      Delaware             1-9874                  94-2213782         
(State of other       (Commission File          (IRS Employer
jurisdiction of        Number)                  Identification No)
incorporation)   



      10831 Old Mill Road       Omaha, Nebraska         68154         
(Address of principal executive offices)               Zip Code



Registrant's Telephone Number, including area code: (402)330-8900



                           N/A                                        
     (Former name or former address, if changed since last report)
<PAGE>
     ITEM 5.  Other Events
      


      On September 28, 1994, the Registrant announced that San
Diego Gas & Electric Company voluntarily dismissed with prejudice
a lawsuit against Yuma Cogeneration Associates, a subsidiary of
the Registrant.  A copy of the press release issued by the
Registrant is set forth as Exhibit 1 hereto and is incorporated
herein by reference.




ITEM 7.  Financial Statements and Exhibits
      
      Exhibit 1 - Press Release dated September 28, 1994.        
      
<PAGE>
                               SIGNATURE

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

                                California Energy Company, Inc.



                                By:   /s/Douglas L. Anderson     
                                      Douglas L. Anderson
                                      Assistant Secretary

Dated:  September 30, 1994

FOR IMMEDIATE RELEASE                                        Exhibit 1


David L. Sokol - Chairman and Chief Executive Officer   (402) 330-8900
Dale R. Schuster - Vice President of Administration     (402) 330-8900
David W. Cox - Vice President of External Affairs       (402) 330-8900



                   CALIFORNIA ENERGY ANNOUNCES THAT 
    SDG&E DISMISSED THE SUIT AGAINST YUMA COGENERATION ASSOCIATES 




OMAHA, NEBRASKA, September 28, 1994 -- California Energy Company,
Inc. (NYSE, PSE and LSE:  CE) announced today that San Diego Gas &
Electric Company ("SDG&E") had voluntarily dismissed with prejudice
its breach of contract case against Yuma Cogeneration Associates,
a subsidiary of California Energy which operates a 50 MW gas-fired
facility which sells power to SDG&E under a 30-year contract.  The
suit was dismissed amicably, without payment by either party, after
California Energy provided certain technical information to SDG&E
which cleared up a technical misunderstanding SDG&E had regarding
the size of the facility.

California Energy Company is a leading international developer,
owner and operator of geothermal and other environmentally
responsible power generation facilities.  Its six existing
facilities currently produce in excess of 325 MW with an additional
300 MW under construction.
                                 ###


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