Preliminary Prospectus Supplement

The information in this preliminary prospectus supplement is not complete and may be changed. This preliminary prospectus supplement and the accompanying prospectus are not an offer to sell these securities and are not soliciting an offer to buy these securities in any jurisdiction where the offer or sale is not permitted.

We are offering $250,000,000 of our % Notes due , . The notes will be unsecured and rank equally with all our existing and future unsecured and unsubordinated indebtedness. The notes will be effectively subordinated to, and thus have a junior position to, any secured debt that we may have outstanding from time to time with respect to the assets securing such debt and the claims of creditors of our subsidiary Cleco Katrina/Rita Hurricane Recovery Funding LLC with respect to the assets of such subsidiary.

The notes will mature on , . Interest on the notes will accrue from November , 2010 and will be payable on and of each year, beginning on , . We may redeem the notes in whole or in part at any time at the redemption price described beginning on page S-9.

Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or determined if this prospectus supplement or the accompanying prospectus is truthful or complete. Any representation to the contrary is a criminal offense.

Investing in the notes involves risks. See “Risk Factors” beginning on page S-5 of this prospectus supplement and beginning on page 5 of the accompanying prospectus. Additionally, see the information in “Item 1A. Risk Factors” in our Annual Report on Form 10-K for the fiscal year ended December 31, 2009 and in our Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2010.

The underwriters expect to deliver the notes to investors through the book-entry delivery system of The Depository Trust Company for the accounts of its participants, including Clearstream Banking, société anonyme, Luxembourg and Euroclear Bank S.A./ N.V., on or about November , 2010.

This document is in two parts. The first part is this prospectus supplement, which describes the specific terms of this offering and certain other matters relating to us and our financial condition. The second part is the prospectus, which gives more general information about the debt securities that we may offer from time to time. Some of the information in the prospectus does not apply to this offering, and this prospectus supplement adds, updates and changes the information contained in the prospectus. You should read the entire prospectus supplement and the accompanying prospectus, including the documents incorporated by reference that are described under “Where You Can Find More Information” in this prospectus supplement.

You should rely only on the information contained or incorporated by reference in this prospectus supplement and the accompanying prospectus. We have not and the underwriters have not authorized anyone else to provide you with any additional or different information. If you receive any unauthorized information, you should not rely on it. We are offering to sell the notes only in places where the offers and sales are permitted. The information contained in this prospectus supplement and the accompanying prospectus is current only as of the date of this prospectus supplement or the accompanying prospectus and the information incorporated by reference is current only as of the date of the document incorporated by reference. Our business, financial condition, liquidity, results of operations and prospects may have changed since those dates.

Summary

This summary highlights information contained elsewhere or incorporated by reference in this prospectus supplement or the accompanying prospectus. This summary is not complete and does not contain all of the information that you should consider before investing in the notes. You should carefully read the entire prospectus supplement, including the risk factors, the accompanying prospectus, including the risk factors set forth therein, and the documents incorporated by reference herein and therein.

Cleco Power LLC

We are a Louisiana limited liability company and a wholly owned subsidiary of Cleco Corporation, a regional energy services holding company. We are an electric utility engaged principally in the generation, transmission, distribution and sale of electricity within Louisiana. We also engage in energy management activities. We are regulated by the Louisiana Public Service Commission and the Federal Energy Regulatory Commission, which determine the rates we can charge our customers, as well as other regulators. We serve approximately 277,000 customers in 107 communities in central and southeastern Louisiana.

Our new retail rate plan

In July 2008, we filed a rate plan to establish new retail rates to be effective upon commercial operation of Madison Unit 3. In October 2009, the Louisiana Public Service Commission approved our new retail plan, which includes a target return on equity of 10.7%, including returning to retail customers 60% of retail earnings between 11.3% and 12.3% and all retail earnings over 12.3%. These new rates became effective February 12, 2010, the commencement date of commercial operations of Madison Unit 3.

Acadiana load pocket

In September 2008, we entered into an agreement with Lafayette Utilities System, a municipal utility, and Entergy Gulf States Louisiana, a subsidiary of Entergy Corporation, to upgrade certain interconnected transmission systems in south Louisiana. The project received the Louisiana Public Service Commission’s approval in February 2009 and confirmation that it is in the public’s interest. Also in February 2009, approval was received from the Southwest Power Pool, our reliability coordinator, to begin construction. The joint project includes expanding and upgrading the electric transmission infrastructure in south central Louisiana in an area known as the Acadiana Load Pocket. The project includes upgrades to certain existing electric facilities as well as the construction of new substations, transmission lines, and capacitor banks. The estimated cost of the project is approximately $250.0 million. Each utility is responsible for various components of the project. Our portion of the cost is approximately $150.0 million, including allowance for funds used during construction. The first phase of construction began in September 2009, with the final phase scheduled to be completed in 2012. At September 30, 2010, we had spent approximately $37.8 million on the Acadiana Load Pocket project.

Advanced metering infrastructure project

In May 2010, we accepted the terms of a $20.0 million grant from the U.S. Department of Energy under a small-grant process to implement smart-grid technology for all of our retail customers. We estimate the project will cost $73.0 million, with the U.S. Department of Energy grant providing $20.0 million toward the project. The grant program is a part of the American Recovery and Reinvestment Act of 2009, an economic stimulus package passed by Congress in February 2009. Smart-grid technology includes the installation of “smart electric meters” that enable two-way communication capabilities between a home or business and a utility company. In April 2010, we received board approval for the project conditioned upon approval by the Louisiana Public Service Commission. Our application to the Louisiana Public Service Commission for authorization of the project is scheduled for consideration for approval by the Louisiana Public Service Commission at its regular monthly meeting on November 10, 2010. If the proposal is approved by the Louisiana Public Service Commission, we expect to complete the project by the first quarter of 2013. If we do not receive approval from the Louisiana Public Service Commission, the project will be re-evaluated at that time.

Teche blackstart unit project

In January 2009, we filed an application with the Louisiana Public Service Commission to improve our blackstart process by purchasing a 33-MW gas turbine to be sited at Teche Power Station and designated as Teche Unit 4. The purpose of the project is to allow us to return our generation system to service more efficiently than is currently possible in the event of a total system shutdown. The Louisiana Department of Environmental Quality issued an air permit in November 2009 and the Louisiana Public Service Commission application was approved in December 2009. We estimate the project will cost $31.0 million, which includes the necessary upgrades to allow the purchased unit to also function as a generation resource suitable for peaking capacity. At September 30, 2010, we had spent approximately $15.7 million on the project. The project is expected to be completed in the second quarter of 2011.

Miscellaneous

Our principal executive offices are located at 2030 Donahue Ferry Road, Pineville, Louisiana 71360-5226, and our telephone number at this address is (318) 484-7400. Our parent company’s homepage on the Internet is located at http://www.cleco.com. Our Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K and other filings with the Securities and Exchange Commission are available, free of charge, through this web site, as soon as reasonably practicable after those reports or filings are electronically filed with or furnished to the Securities and Exchange Commission. Information on this web site or any other web site is not incorporated by reference into this prospectus supplement or the accompanying prospectus and does not constitute a part of this prospectus supplement or the accompanying prospectus. For additional information regarding reports and other information we file with or furnish to the Securities and Exchange Commission and obtaining other information about us, please read “Where You Can Find More Information.”

The offering

Issuer

Cleco Power LLC

Notes Offered

$250 million aggregate principal amount of % Notes due .

Maturity Date

The notes will mature on , , unless redeemed or otherwise repaid prior to that date.

Interest Payment Dates

and of each year, beginning , .

Optional Redemption

We may redeem all or a part of the notes at any time and from time to time at the redemption price described herein, plus accrued and unpaid interest thereon to (but excluding) the redemption date, as specified under “Description of the Notes—Optional Redemption” beginning on page S-9 of this prospectus supplement.

Ranking

The notes will be unsecured and will rank equally with all our existing and future unsecured and unsubordinated indebtedness. As of September 30, 2010, we had an aggregate of $1.2 billion of unsecured and unsubordinated indebtedness. The notes will be effectively subordinated to, and thus have a junior position to, any secured debt that we may have outstanding from time to time (including any first mortgage bonds) with respect to the assets securing such debt. As of September 30, 2010, we had no secured indebtedness outstanding. In addition, holders of the notes will be effectively subordinated to the claims of creditors and any preferred equity holders of our subsidiaries with respect to the assets of such subsidiaries. As of September 30, 2010, our sole subsidiary, Cleco Katrina/Rita Hurricane Recovery Funding LLC, had $155.6 million of Senior Secured Storm Recovery Bonds outstanding.

Certain Covenants

We will issue the notes under an indenture containing certain restrictive covenants for your benefit. These covenants are described under “Description of the Notes—Ranking; Certain Covenants Relating to the Notes” on page S-8 of this prospectus supplement and “Description of the Debt Securities—Ranking; Limitations on Mortgages and Liens” and “—Consolidation, Merger, Sale or Conveyance” in the accompanying prospectus.

Use of Proceeds

We intend to use the net proceeds from this offering for general corporate purposes, including financing a portion of our costs related to the Acadiana Load Pocket transmission project and the advanced metering infrastructure project.

Trustee and Paying Agent

The Bank of New York Mellon Trust Company, N.A.

Risk Factors

See “Risk Factors” beginning on page S-5 of this prospectus supplement and beginning on page 5 of the accompanying prospectus. Additionally, see the information in “Item 1A. Risk Factors” in our Annual Report on Form 10-K for the fiscal year ended December 31, 2009 and in our Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2010.

Governing Law

The indenture and the notes will be governed by, and construed in accordance with, the laws of the State of New York.

Investing in the notes involves risk. You should carefully consider all of the information included or incorporated by reference in this prospectus supplement and the accompanying prospectus before deciding whether to make an investment. In particular, you should carefully consider the risks described (i) below; (ii) under the caption “Risk Factors” beginning on page 5 of the accompanying prospectus and (iii) in “Item 1A. Risk Factors” in our Annual Report on Form 10-K for the fiscal year ended December 31, 2009 and in our Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2010. You should also carefully review the information under the caption “Cautionary Statement Regarding Forward-Looking Statements” in the accompanying prospectus. We also identify risks and other factors that could affect our results of operations or financial condition in our annual report, quarterly reports and current reports incorporated by reference in this prospectus supplement and the accompanying prospectus. There may be additional risks that are not currently known to us or that we do not currently consider material. These risks and uncertainties could have an adverse effect on our business, including, depending on the circumstances, our results of operations and financial condition, or could adversely affect the value of the notes offered by this prospectus supplement.

The notes will be our unsecured obligations and be effectively subordinated to any secured debt and the debt and any preferred equity of any of our subsidiaries.

The notes will be unsecured and will rank equally with all our existing and future unsecured and unsubordinated indebtedness. As of September 30, 2010, we had an aggregate of $1.2 billion of unsecured and unsubordinated indebtedness. The notes will be effectively subordinated to, and thus have a junior position to, any secured debt that we may have outstanding from time to time (including any first mortgage bonds) with respect to the assets securing such debt. As of September 30, 2010, we had no secured indebtedness outstanding. Our first mortgage bond indenture permits us to issue up to $500 million of first mortgage bonds, however, covenants in our other debt instruments, including our credit facility, may impose limitations on the indebtedness we may incur. Additionally, our ability (and the ability of our creditors, including noteholders) to participate in the assets of our subsidiary, Cleco Katrina/Rita Hurricane Recovery Funding LLC, is subject to the prior claims of the subsidiary’s creditors. As of September 30, 2010, Cleco Katrina/Rita Hurricane Recovery Funding LLC had $155.6 million of indebtedness outstanding.

We cannot assure you that an active trading market for the notes will develop.

We do not intend to apply for listing of the notes on any securities exchange or automated quotation system. There can be no assurance as to the liquidity of any market that may develop for the notes, the ability of the noteholders to sell their notes or the price at which the noteholders may be able to sell their notes. Future trading prices of the notes will depend on many factors including, among other things, prevailing interest rates, our credit rating, our operating results and the market for similar securities.

The underwriters have informed us that they intend to make a market in the notes. However, the underwriters are not obligated to do so, and any such market-making activity may be terminated at any time without notice. In addition, such market-making activity will be subject to restrictions under federal securities laws. If a market for the notes does not develop, noteholders may be unable to resell the notes for an extended period of time. Consequently, a noteholder may not be able to liquidate its investment readily, and the notes may not be readily accepted as collateral for loans.

The following table sets forth the cash and cash equivalents and capitalization of Cleco Power and our sole subsidiary, Cleco Katrina/Rita Hurricane Recovery Funding LLC, as of September 30, 2010:

You should read this table in conjunction with our historical financial statements, the notes to those financial statements and other financial information we have incorporated by reference in this prospectus supplement and the accompanying prospectus.

We expect the net proceeds to us from the sale of the notes offered hereby to be approximately $ million, after deducting the underwriting discount and our other estimated offering expenses. We intend to use the net proceeds from this offering for general corporate purposes, including financing a portion of the costs related to the Acadiana Load Pocket transmission project and the advanced metering infrastructure project.

The following table presents our summary financial information. The information set forth below should be read together with our historical financial statements, the notes to those financial statements and other financial information we have incorporated by reference in this prospectus supplement and the accompanying prospectus. Our summary of operations and balance sheet data for the years ended December 31, 2009, 2008 and 2007 are derived from our audited financial statements. Our summary of operations and balance sheet data for the nine months ended September 30, 2010 and 2009 are derived from our unaudited interim financial statements, which interim financial statements, in the opinion of management, include all adjustments, consisting only of normal recurring adjustments, necessary for a fair statement of the results of operations and financial position of the unaudited interim period.

We have summarized below some of the provisions of the notes. Because this discussion is only a summary, it does not necessarily contain all of the information you should consider. Our debt securities and the indenture, dated as of October 1, 1988, between us (as successor to Cleco Utility Group Inc.) and The Bank of New York Mellon Trust Company, N.A. (as successor to The Bank of New York) as trustee, as amended and supplemented from time to time, pursuant to which the notes will be issued, are more fully described in the accompanying prospectus. Additionally, the indenture is an exhibit to the registration statement of which the accompanying prospectus is a part. The following summary of the notes is qualified in its entirety by reference to the indenture. In this prospectus supplement, we refer to the trustee under the indenture as the “trustee.”

We will issue the notes as a single series of debt securities under the indenture in denominations of $2,000 and integral multiples of $1,000. The notes offered hereby will be limited in principal amount to $250 million; provided, however, that this amount may in the future be increased pursuant to the provisions of the indenture without the consent of the holders of the notes. The notes will constitute our direct, unsecured obligations and will not be subject to any sinking fund provision.

The indenture does not limit the aggregate principal amount of unsecured debt securities that we can issue under it and provides that we may issue debt securities from time to time in one or more series up to the aggregate principal amount authorized by us for a particular series. We may, from time to time, without the consent of the holders of the notes, issue notes or other debt securities under the indenture in addition to the notes offered hereby. At September 30, 2010, we had $694.2 million principal amount of debt securities outstanding under the indenture, consisting of $24.2 million principal amount of 6.125% insured quarterly notes due 2017, $75.0 million principal amount of 5.375% notes due 2013, $50.0 million principal amount of 4.95% notes due 2015, $250.0 million principal amount of 6.65% notes due 2018 and $295.0 million principal amount of 6.50% notes due 2035. On October 20, 2010, we redeemed $24.2 million principal amount of 6.125% insured quarterly notes due 2017 prior to maturity at par.

The notes will be unsecured and rank equally with all our existing and future unsecured and unsubordinated indebtedness. As of September 30, 2010, we had an aggregate of $1.2 billion of unsecured and unsubordinated indebtedness. We may from time to time issue mortgage bonds under an Indenture of Mortgage, dated as of July 1, 1950, between us and The Bank of New York Mellon Trust Company, N.A., as trustee, and secured thereby (or a replacement Indenture of Mortgage). Holders of the first mortgage bonds would have a prior claim on certain of our material assets upon dissolution, winding up, liquidation or reorganization by us. As of September 30, 2010, we had no secured indebtedness outstanding. Under the terms of the Indenture of Mortgage, we may issue up to $500 million principal amount of first mortgage bonds secured thereby. However, covenants in our other debt instruments, including our credit facility, may impose limitations on the indebtedness we may incur, including secured indebtedness under the Indenture of Mortgage. As of September 30, 2010, and giving effect to this offering of $250 million principal amount of notes, our credit facility limited the amount of additional indebtedness we could incur to approximately $900 million. So long as any debt

securities issued under the indenture, including the notes, remain outstanding, the indenture prohibits us, subject to certain exceptions (which include bonds issued under our first mortgage bond indenture), from creating or permitting any mortgage, lien or similar encumbrance on any of our properties, unless we secure such debt securities equally and ratably with the mortgage being created or permitted. For more information regarding this limitation on mortgages and liens, including the exceptions to such limitation, and on another restrictive covenant applicable to the notes, please read “Description of the Debt Securities—Ranking; Limitations on Mortgages and Liens” and “—Consolidation, Merger, Sale or Conveyance” in the accompanying prospectus.

In addition, holders of the notes will be effectively subordinated to the claims of creditors and any preferred equity holders of our subsidiaries with respect to the assets of such subsidiaries. As of September 30, 2010, our sole subsidiary, Cleco Katrina/Rita Hurricane Recovery Funding LLC, had $155.6 million of indebtedness outstanding.

The entire principal amount of the notes, unless previously redeemed or otherwise repaid, will mature and become due and payable, together with any unpaid interest accrued to (but excluding) the maturity date, on , . In the event that the maturity date or any redemption date is not a business day, then payment of principal and any interest will be made on the next business day, without any interest or other payment in respect of the delay.

Each note will bear interest at % per year from the date of original issuance, payable in arrears on and of each year to the person in whose name the note is registered at the close of business on the calendar day of the month in which the applicable interest payment date falls. Interest accrued on the notes that is payable at maturity or earlier redemption will be payable to the persons entitled to payment of principal as a result of maturity or redemption, as the case may be. The initial interest payment date is , , and the payment on that date will include all interest accrued from the date of original issuance. The amount of interest payable will be computed on the basis of a 360-day year of twelve 30-day months. In the event that any interest payment date is not a business day, then payment of the interest will be made on the next business day, without any interest or other payment in respect of the delay. In addition, if there has been a default in the payment of interest on any note, the defaulted interest may be payable to the holder of the note as of the close of business on a date selected by the trustee not more than 15 days and not less than 10 days prior to the date proposed by us for payment of this defaulted interest, and not less than 15 days after the receipt by the trustee of our notice of the proposed payment, or in any other lawful manner as provided in the indenture.

The notes will be redeemable as a whole or in part, at our option, at any time and from time to time, at a redemption price equal to the greater of:

plus in either case accrued and unpaid interest on the notes to (but excluding) the date of redemption.

“Treasury Rate” means, with respect to any redemption date, the rate per annum equal to the semiannual equivalent yield to maturity of the Comparable Treasury Issue, assuming a price for the Comparable Treasury Issue (expressed as a percentage of its principal amount) equal to the Comparable Treasury Price for such redemption date.

“Comparable Treasury Issue” means the United States Treasury security selected by an Independent Investment Banker as having a maturity comparable to the remaining term of the notes to be redeemed that would be used, at the time of selection and in accordance with customary financial practice, in pricing new issues of corporate debt securities of comparable maturity to the remaining term of the notes.

“Independent Investment Banker” means an independent investment banking institution of national standing appointed by us. If we fail to appoint an independent investment banking institution at least 30 business days prior to the redemption date, or if the institution we appoint is unwilling or unable to select the Comparable Treasury Issue, the selection will be made by J.P. Morgan Securities LLC, or, if it is unwilling or unable to make the selection, by an independent investment banking institution of national standing appointed by the trustee.

“Comparable Treasury Price” means, with respect to any redemption date, (a) the average of the Reference Treasury Dealer Quotations for such redemption date, after excluding the highest and lowest such Reference Treasury Dealer Quotations, or (b) if the trustee obtains fewer than four such Reference Treasury Dealer Quotations, the average of all such quotations.

“Reference Treasury Dealer Quotations” means, with respect to each Reference Treasury Dealer and any redemption date, the average, as determined by the trustee, of the bid and asked prices for the Comparable Treasury Issue (expressed in each case as a percentage of its principal amount) quoted in writing to the trustee by such Reference Treasury Dealer at 5:00 p.m. on the third business day preceding such redemption date.

“Reference Treasury Dealer” means J.P. Morgan Securities LLC and its successors, and four other primary U.S. Government securities dealers in the United States (“Primary Treasury Dealer”) appointed by us in connection with the redemption; provided, however, that if any of the foregoing shall cease to be a Primary Treasury Dealer, we shall replace that former dealer with another Primary Treasury Dealer.

We or the trustee will mail notice of any redemption between 30 days and 60 days before the redemption date to each holder of the notes to be redeemed.

We will be discharged from all of our obligations with respect to the notes, except for certain obligations to exchange or register the transfer of notes, to replace stolen, lost or mutilated notes, to maintain paying agencies and to hold moneys for payment in trust, upon the deposit in trust for the benefit of the holders of the notes of money or U.S. government obligations, or both. A deposit by us in this manner will provide money in an amount sufficient to pay the principal and interest on the notes on the maturity date in accordance with the terms of the indenture and the notes through the payment of principal and interest in respect of the deposited money or government obligations in accordance with their terms. This defeasance or

discharge may occur only if, among other things, we have delivered to the trustee an opinion of counsel to the effect that we have received from, or there has been published by, the United States Internal Revenue Service a ruling, or there has been a change in tax law, in either case to the effect that holders of the notes will not recognize gain or loss for U.S. federal income tax purposes as a result of the deposit, defeasance and discharge and will be subject to U.S. federal income tax on the same amount, in the same manner and at the same times as would have been the case if the deposit, defeasance and discharge were not to occur.

In certain circumstances, we may omit to comply with specified restrictive covenants applicable to the notes. In those circumstances, the occurrence of certain events of default, which are described in the accompanying prospectus under “Description of the Debt Securities—Events of Default,” will be deemed not to be or result in an event of default with respect to the notes. In order to exercise this option, we will be required to deposit, in trust for the benefit of the holders of the notes, money or U.S. government obligations, or both. A deposit by us in this manner will provide money in an amount sufficient to pay the principal and interest on the notes on the respective stated maturity date in accordance with the terms of the indenture and the notes through the payment of principal and interest in respect of the money or government obligations in accordance with their terms. We will also be required, among other things, to deliver to the trustee an opinion of counsel to the effect that holders of the notes will not recognize gain or loss for U.S. federal income tax purposes as a result of the deposit and defeasance of certain obligations and will be subject to U.S. federal income tax on the same amount, in the same manner and at the same times as would have been the case if the deposit and defeasance were not to occur. In the event we exercise this option with respect to any notes and the notes are declared due and payable because of the occurrence of any event of default, the amount of money and U.S. government obligations deposited in trust would be sufficient to pay amounts due on the notes at the time of their stated maturity, but might not be sufficient to pay amounts due on the notes upon any acceleration resulting from the event of default. In this case, we would remain liable for those payments.

The Depository Trust Company will act as the initial securities depositary for the notes. The notes will be issued only as fully registered securities in the name of Cede & Co., the depositary’s nominee. One or more fully registered global notes will be issued, representing in the aggregate the total principal amount of notes offered by this prospectus supplement, and will be deposited with the depositary. Unless and until it is exchanged in whole or in part for notes in certificated form, no global note may be transferred except as a whole by the depositary or a nominee of the depositary. A global note will be exchangeable for notes in certificated form only if:

Investors may hold interests in the notes outside the United States through Euroclear or Clearstream if they are participants in those systems, or indirectly through organizations which are participants in those systems. Euroclear and Clearstream will hold interests on behalf of their participants through customers’ securities accounts in Euroclear’s and Clearstream’s names on the

books of their respective depositaries which in turn will hold such positions in customers’ securities accounts in the names of the nominees of the depositaries on the books of The Depository Trust Company. All securities in Euroclear or Clearstream are held on a fungible basis without attribution of specific certificates to specific securities clearance accounts.

For more information about notes in global and certificated form and the depositary and its procedures, please read “Description of the Debt Securities—Form, Denomination and Registration; Book-Entry System” in the accompanying prospectus.

The trustee is an affiliate of the administrative agent and one of the lenders under our credit facility.

The following describes certain U.S. federal income tax consequences of the acquisition, ownership and disposition of the notes by holders that purchase notes at their original issuance at the issue price set forth on the cover of this prospectus supplement. This discussion is based upon the Internal Revenue Code of 1986, as amended (the “Code”), its legislative history, existing and proposed regulations thereunder, published rulings and pronouncements of the Internal Revenue Service (“IRS”) and court decisions, all as in effect on the date of this prospectus supplement, and all of which are subject to change, possibly on a retroactive basis. This discussion is not a complete discussion of all the potential tax consequences that may be relevant to you. This discussion only applies to holders that purchase the notes offered hereby at their “issue price” (i.e., the first price at which a substantial amount of the notes are sold for cash to persons other than bond houses, brokers or similar persons or organizations acting in the capacity of underwriters, placement agents or wholesalers) and that hold the notes as capital assets. This discussion does not discuss special rules that may apply to certain holders, such as insurance companies, tax exempt organizations, financial institutions, regulated investment companies, real estate investment trusts, investors in pass-through entities, expatriates, taxpayers subject to the alternative minimum tax, broker-dealers and persons holding the notes as part of a “straddle,” “hedge,” “integrated transaction,” or “conversion transaction.” This discussion does not address any estate, gift, foreign, state or local taxes or the effect of any tax treaty. In addition, this discussion does not address the tax consequences of an investment in the notes arising under the unearned income Medicare contribution tax pursuant to the Health Care and Education Reconciliation Act of 2010. No ruling has been or is expected to be obtained from the IRS regarding the U.S. federal income tax consequences relating to the purchase, ownership or disposition of the notes. As a result, no assurance can be given that the IRS will not assert, or that a court will not sustain, a position contrary to the conclusions set forth below.

We urge you to consult your own tax advisors regarding the particular U.S. federal income tax consequences to you of acquiring, holding and disposing of notes, any tax consequences that may arise under the laws of any relevant foreign, state, local, or other taxing jurisdiction or under any applicable tax treaty, as well as possible effects of changes in federal or other tax laws.

For purposes of this discussion, you are a “U.S. holder” if you are a beneficial owner of notes that is a “United States person” for U.S. federal income tax purposes or a “non-U.S. holder” if you are a beneficial owner of notes that is an individual, corporation, trust or estate that is not a “United States person” for U.S. federal income tax purposes. A “United States person” is:

If a partnership or other entity treated as a partnership for U.S. federal income tax purposes holds the notes, the tax treatment of a partner in the partnership will generally depend on the status of the partner and on the activities of the partnership. Partners in partnerships holding notes and such partnerships should consult their tax advisors.

Payments of interest. Payments of stated interest on a note will generally be taxable to you as ordinary interest income at the time such payments are received or accrued, depending on your regular method of accounting for U.S. federal income tax purposes. It is not anticipated that the notes will be issued with original issue discount that is equal to or more than the applicable de minimis amount.

Optional redemption. We have the right to redeem all or a portion of the notes at any time. See “Description of the Notes—Optional Redemption” beginning on page S-9. Under applicable Treasury regulations, an unconditional option to redeem a debt instrument will be deemed to be exercised if such exercise will lower the yield to maturity of such debt instrument. We do not intend on the issuance date to treat any of our redemption rights as affecting the computation of the yield to maturity of the notes. The IRS may take a different position regarding the payment or potential payment of amounts in excess of qualified stated interest or principal, in which case the timing, amount and character of income with respect to a Note may be different, and a U.S. Holder could be required to treat as ordinary income any gain recognized on the disposition of a Note. U.S. Holders are urged to consult their own tax advisors regarding the potential effect, if any, of these matters on their particular situation.

Sale, exchange, redemption or other taxable disposition of the notes. Upon a sale, exchange, redemption or other taxable disposition of a note, you generally will recognize gain or loss in an amount equal to the difference between the amount received upon the sale, exchange, redemption or other taxable disposition (less any amount attributable to accrued and unpaid interest on the notes that you have not previously included in income, which will be taxable as such (as described above)) and your adjusted tax basis in the note at that time.

Your adjusted tax basis in a Note generally will equal your cost thereof. Except to the extent attributable to accrued and unpaid interest, which will be taxable as ordinary interest income (as described above), any gain or loss realized upon the sale, exchange, redemption or other taxable disposition of a note will be capital gain or loss, and will be long-term capital gain or loss if, at the time of such sale, exchange, redemption or other taxable disposition, the note has been held by you for more than one year. Under current law, long-term capital gains of certain non-corporate holders are generally taxed at lower rates than items of ordinary income. The deductibility of capital losses is subject to limitations.

Information reporting and backup withholding. In general, information reporting is required as to certain payments of principal of, and interest on, the notes and on the disposition of notes unless you are a corporation or other exempt person. In addition, you will be subject to backup withholding (at a current rate of 28%, which is scheduled to increase to 31% for payments made after December 31, 2010) if you are not exempt and you fail to properly furnish a taxpayer identification number or if the IRS has notified you that you are subject to backup withholding.

Any amount withheld from a payment under the backup withholding rules may be allowed as a credit against your U.S. federal income tax liability and may entitle you to a refund, provided that the required information is furnished to the IRS in a timely manner.

Payments of interest. Payments of interest on the notes that are not effectively connected with your conduct of a trade or business in the United States (or, if an applicable tax treaty applies, are not attributable to a permanent establishment maintained by you) will not be subject to U.S. federal income tax, and withholding of U.S. federal income tax will not be required on that payment if you:

If you do not satisfy the preceding requirements, your interest on a Note would generally be subject to a 30% U.S. withholding tax unless (i) you provide a properly executed IRS Form W-8BEN (or applicable substitute form) claiming an exemption from, or reduction of, withholding under an applicable tax treaty or (ii) the interest is effectively connected with your conduct of a trade or business in the United States.

If you are engaged in a trade or business in the United States, and if interest on a Note is effectively connected with the conduct of that trade or business (and, if an applicable tax treaty applies, is attributable to a permanent establishment you maintain in the United States) you will be exempt from U.S. withholding tax if specific certification requirements are met. However, you will be subject to regular U.S. federal income tax on the interest in the same manner as if you were a United States person. You can generally meet the certification requirements if you provide to the person who would otherwise be required to withhold U.S. tax a properly completed and executed IRS Form W-8ECI or applicable substitute form. In addition to regular U.S. federal income tax, if you are a foreign corporation, you may be subject to a U.S. branch profits tax at a 30% rate, although an applicable tax treaty may provide for a lower rate.

Sale, exchange, redemption or other taxable disposition of the notes. You generally will not be subject to U.S. federal income tax on any gain realized on a sale, exchange, redemption or other taxable disposition of a Note unless:

However, to the extent that the proceeds of disposition represent interest accruing between interest payment dates, you may be required to establish an exemption from U.S. federal income tax. See “—Non-U.S. Holders—Payments of Interest.”

Information reporting and backup withholding. Payments to a non-U.S. holder of interest on the notes, and amounts withheld from such payments, if any, generally will be required to be reported to the IRS and to the non-U.S. holder.

United States backup withholding generally will not apply to payments of interest on, and principal of, the notes to a non-U.S. holder if the statement described in “—Non-U.S. Holders—Payments of Interest” is duly provided by the non-U.S. holder or the non-U.S holder otherwise establishes an exemption, provided that we do not have actual knowledge or reason to know that the non-U.S. holder is a United States person.

Payment of the proceeds of a sale of notes effected by the United States office of a United States or foreign broker will be subject to information reporting requirements and backup withholding (at a current rate of 28%, which is scheduled to increase to 31% for payments made after December 31, 2010) unless you properly certify under penalties of perjury as to your foreign status and certain other conditions are met or you otherwise establish an exemption. Information reporting requirements and backup withholding generally will not apply to any payment of the proceeds of the sale of notes effected outside the United States by a foreign office of a broker. However, unless such a broker has documentary evidence in its records that you are a non-U.S. holder and certain other conditions are met, or you otherwise establish an exemption, information reporting will apply to a payment of the proceeds of the sale of notes effected outside the United States by such a broker if it is:

We intend to offer the notes through the underwriters. J.P. Morgan Securities LLC, Credit Agricole Securities (USA) Inc., KeyBanc Capital Markets Inc., Banc of America Securities LLC and Credit Suisse Securities (USA) LLC are acting as the underwriters. Subject to the terms and conditions contained in an underwriting agreement between us and the underwriters, we have agreed to sell to the underwriters and the underwriters severally have agreed to purchase from us, the principal amount of the notes listed opposite their names below.

The underwriters have agreed to purchase all of the notes sold pursuant to the underwriting agreement if any of these notes are purchased. If an underwriter defaults, the underwriting agreement provides that the purchase commitments of the nondefaulting underwriters may be increased or the underwriting agreement may be terminated.

We have agreed to indemnify the underwriters against certain liabilities, including liabilities under the Securities Act of 1933, as amended, or to contribute to payments the underwriters may be required to make in respect of those liabilities.

The underwriters are offering the notes, subject to prior sale, when, as and if issued to and accepted by them, subject to approval of legal matters by their counsel, including the validity of the notes, and other conditions contained in the underwriting agreement, such as the receipt by the underwriters of officer’s certificates and legal opinions. The underwriters reserve the right to withdraw, cancel or modify offers to the public and to reject orders in whole or in part.

The underwriters have advised us that they propose initially to offer the notes to the public at the public offering price on the cover page of this prospectus supplement, and to dealers at that price less a concession not in excess of % of the principal amount of the notes. The underwriters may allow, and the dealers may reallow, a discount not in excess of % of the principal amount of the notes to other dealers. After the initial public offering, the public offering price, concession and discount may be changed.

The expenses of the offering, not including the underwriting discount, are estimated to be $350,000 and are payable by us.

We have agreed, during the period of 30 days from the date on which the notes are purchased by the underwriters not to sell, offer to sell, grant any option for the sale of, or otherwise dispose of any notes, any security convertible into or exchangeable into or exercisable for the notes or any debt securities substantially similar to the notes, without first obtaining the written consent of J.P. Morgan Securities LLC, Credit Agricole Securities (USA) Inc. and KeyBanc Capital Markets Inc.

The notes are a new issue of securities with no established trading market. We do not intend to apply for listing of the notes on any securities exchange or for quotation of the notes on any automated dealer quotation system. We have been advised by the underwriters that they presently intend to make a market in the notes after completion of the offering. However, they are under no obligation to do so and may discontinue any market-making activities at any time without any notice. We cannot assure the liquidity of the trading market for the notes or that an active public market for the notes will develop. If an active public trading market for the notes does not develop or is not sustained, the market price and liquidity of the notes may be adversely affected.

In connection with the offering, the underwriters are permitted to engage in transactions that stabilize the market price of the notes. Such transactions consist of bids or purchases to peg, fix or maintain the price of the notes. If the underwriters create a short position in the notes in connection with the offering, i.e., if they sell notes with an aggregate principal amount in excess of the amount set forth on the cover page of this prospectus supplement, the underwriters may reduce that short position by purchasing notes in the open market. Purchases of a security to stabilize the price or to reduce a short position could cause the price of the security to be higher than it might be in the absence of such purchases.

Neither we nor any of the underwriters makes any representation or prediction as to the direction or magnitude of any effect that the transactions described above may have on the price of the notes. In addition, neither we nor any of the underwriters makes any representation that the underwriters will engage in these transactions or that these transactions, once commenced, will not be discontinued without notice.

The underwriters and certain of their affiliates have engaged and may in the future engage in commercial banking and investment banking transactions with us.

This prospectus supplement and the accompanying prospectus have not been approved by an authorized person for the purposes of Section 21 of the Financial Services and Markets Act 2000 (“FSMA”) and are, accordingly, only being distributed in the United Kingdom to, and are only directed at (i) investment professionals falling within the description of persons in Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005, as amended (the “Financial Promotion Order”); or (ii) high net worth companies and other persons falling within Article 49(2)(a) to (d) of the Financial Promotion Order; or (iii) to any other person to whom they may otherwise lawfully be communicated or made in accordance with the Financial Promotion Order (all such persons together being referred to as “relevant persons”).

The notes are only available to, and any invitation, offer or agreement to subscribe, purchase or otherwise acquire such notes will be engaged in only with, relevant persons. Any person who is not a relevant person should not act or rely on this document or any of its contents.

An invitation or inducement to engage in investment activity (within the meaning of Section 21 of FSMA) in connection with the issue or sale of any notes which are the subject of the offering contemplated by this prospectus will only be communicated or caused to be communicated in circumstances in which Section 21(1) of FSMA does not apply to us.

In relation to each Member State of the European Economic Area which has implemented the Prospectus Directive (each, a “Relevant Member State”), with effect from and including the date on which the Prospectus Directive is implemented in that Relevant Member State (the “Relevant Implementation Date”) an offer of notes to the public may not be made in that Relevant Member State prior to the publication of a prospectus in relation to the note which has been approved by the competent authority in that Relevant Member State or, where appropriate, approved in another Relevant Member State and notified to the competent authority in that Relevant Member State, all in accordance with the Prospectus Directive, except that an offer of notes to the public in that Relevant Member State may be made at any time under the following exemptions under the Prospectus Directive if they have been implemented in the Relevant Member State:

provided that no such offer of notes shall require us or any underwriter to publish a prospectus pursuant to Article 3 of the Prospectus Directive or supplement a prospectus pursuant to Article 16 of the Prospectus Directive.

For the purposes of this provision, the expression an “offer of notes to the public” in relation to any notes in any Relevant Member State means the communication in any form and by any means of sufficient information on the terms of the offer and the notes to be offered so as to enable an investor to decide to purchase or subscribe the notes, as the same may be varied in that Member State by any measure implementing the Prospectus Directive in that Member State and the expression “Prospectus Directive” means Directive 2003/71/EC and includes any relevant implementing measure in each Relevant Member State.

We file annual, quarterly and current reports and other information with the Securities and Exchange Commission. We are incorporating by reference the documents listed below and any future filings we make with the Securities and Exchange Commission under Sections 13(a), 13(c), 14 or 15(d) of the Securities Exchange Act of 1934 until we sell all the notes, excluding any information that is furnished to, and not filed with, the Securities and Exchange Commission. Please also see “Where You Can Find More Information” on page 22 of the accompanying prospectus.

The validity of the notes offered hereby will be passed upon for us by Baker Botts L.L.P., Houston, Texas. Sidley Austin LLP, New York, New York, will act as counsel to the underwriters. Wade A. Hoefling, our Senior Vice President—General Counsel and Director of Regulatory Compliance will pass upon all matters of Louisiana law in this connection and Baker Botts L.L.P. and Sidley Austin LLP will rely upon such opinion as to matters of Louisiana law. At September 30, 2010, Mr. Hoefling beneficially owned 17,707 shares of Cleco Corporation common stock (including shares held under employee benefit plans). None of such shares were issued or granted in connection with the offering of the notes offered hereby.

The financial statements, financial statement schedule, and management’s assessment of the effectiveness of internal control over financial reporting (which is included in Management’s Report on Internal Control over Financial Reporting) incorporated in this Prospectus Supplement by reference to the Annual Report on Form 10-K of Cleco Power LLC for the year ended December 31, 2009 have been so incorporated in reliance on the report of PricewaterhouseCoopers LLP, an independent registered public accounting firm, given on the authority of said firm as experts in auditing and accounting.

We may offer and sell up to $500,000,000 of our debt securities in one or more series by using this prospectus. We will establish the terms for our debt securities at the time we sell them and we will describe them in one or more supplements to this prospectus. You should read this prospectus and the related prospectus supplement carefully before you invest in our debt securities. This prospectus may not be used to offer and sell our debt securities unless accompanied by a prospectus supplement.

Investing in our debt securities involves risks. See “Risk Factors” beginning on page 5.

Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense.

This prospectus is part of a registration statement we have filed with the Securities and Exchange Commission using a “shelf” registration process. By using this process, we may offer up to $500,000,000 of our debt securities in one or more offerings. This prospectus provides you with a description of the debt securities we may offer. Each time we offer debt securities, we will provide a supplement to this prospectus. The prospectus supplement will describe the specific terms of the offering. The prospectus supplement may also add, update or change the information contained in this prospectus. Please carefully read this prospectus, the applicable prospectus supplement and the information contained in the documents we refer to in the “Where You Can Find More Information” section of this prospectus.

You should rely only on the information contained or incorporated by reference in this prospectus and any accompanying prospectus supplement. We have not authorized anyone else to provide you with any additional or different information. If anyone provides you with different or inconsistent information, you should not rely on it. We are not making an offer to sell securities in any jurisdiction where the offer or sale is not permitted. The information contained in this prospectus is current only as of the date of this prospectus, and any information incorporated by reference is current only as of the date of the document incorporated by reference. Our business, financial condition, results of operations and prospects may have changed since those dates.

This prospectus, including the information we incorporate by reference, contains statements that are “forward-looking statements.” All statements other than statements of historical fact included or incorporated by reference in this prospectus are forward-looking statements, including, without limitation, statements regarding the construction, timing and cost of Rodemacher Unit 3, our 600 megawatt solid-fuel power plant under construction in Boyce, Louisiana; future capital expenditures; projections; business strategies; goals; competitive strengths; market and industry developments; development and operation of facilities; future environmental regulations and remediation liabilities; and the anticipated outcome of various regulatory and legal proceedings. Generally, you can identify our forward-looking statements by the words “anticipate,” “estimate,” “expect,” “objective,” “projection,” “forecast,” “goal” or other similar words.

We have based our forward-looking statements on our management’s beliefs and assumptions based on information available to our management at the time the statements are made. We caution you that assumptions, beliefs, expectations, intentions and projections about future events may and often do vary materially from actual results. Therefore, we cannot assure you that actual results will not differ materially from those expressed or implied by our forward-looking statements.

In addition to any assumptions and other factors referred to specifically in connection with our forward-looking statements, the following list identifies some of the factors that could cause actual results to differ materially from those expressed or implied by our forward-looking statements:

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

We are a Louisiana limited liability company and a wholly owned subsidiary of Cleco Corporation, a regional energy services holding company. We are an electric utility engaged principally in the generation, transmission, distribution and sale of electricity within Louisiana. We also engage in energy management activities. We are regulated by the Louisiana Public Service Commission and the Federal Energy Regulatory Commission, which determine the rates we can charge our customers, as well as other regulators. We serve approximately 276,000 customers in 107 communities in central and southeastern Louisiana.

Cleco Corporation, subject to certain limited exceptions, is exempt from regulation as a public utility holding company pursuant to provisions of the Public Utility Holding Company Act of 2005.

Our principal executive offices are located at 2030 Donahue Ferry Road, Pineville, Louisiana 71360-5226, and our telephone number at this address is (318) 484-7400. Our parent company’s homepage on the Internet is located at http://www.cleco.com. Our Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K and other filings with the Securities and Exchange Commission are available, free of charge, through this web site, as soon as reasonably practicable after those reports or filings are electronically filed with or furnished to the Securities and Exchange Commission. Information on this web site or any other web site is not incorporated by reference into this prospectus or any accompanying prospectus supplement and does not constitute a part of this prospectus or any accompanying prospectus supplement. For additional information regarding reports and other information we file with or furnish to the Securities and Exchange Commission and obtaining other information about us, please read “Where You Can Find More Information” beginning on page 22 of this prospectus.

The following table sets forth, in accordance with Securities and Exchange Commission requirements, our ratio of earnings from continuing operations to fixed charges for each of the periods indicated:

For the purpose of calculating the ratio of earnings to fixed charges, earnings represent the aggregate of income from continuing operations before income taxes and fixed charges. Fixed charges include interest expense, amortized premiums or discounts on capitalized expenses related to indebtedness and an estimate of the interest within rental expense.

Investing in our debt securities involves risk. You should carefully consider all of the information included or incorporated by reference in this prospectus and any accompanying prospectus supplement before deciding whether to make an investment in our debt securities. In particular, you should carefully consider the risks described below and in our annual report, quarterly reports and current reports incorporated by reference in this prospectus as well as the factors listed under “Cautionary Statement Regarding Forward-Looking Statements.” There may be additional risks that are not currently known to us or that we do not currently consider material. These risks and uncertainties could have an adverse effect on our business, including, depending on the circumstances, our results of operations and financial condition, or could adversely affect the value of our debt securities.

The Louisiana Public Service Commission and Federal Energy Regulatory Commission regulate the rates that we can charge our customers. On October 14, 2009, the Louisiana Public Service Commission unanimously approved our new retail rate plan. The Louisiana Public Service Commission’s decision to approve the new retail rate plan could be appealed or otherwise challenged.

Our ongoing financial viability depends on our ability to recover our costs from our Louisiana Public Service Commission jurisdictional customers in a timely manner through our Louisiana Public Service Commission-approved rates and our ability to pass through to our Federal Energy Regulatory Commission customers in rates our Federal Energy Regulatory Commission-authorized revenue requirements. Our financial viability also depends on our ability to recover in rates an adequate return on capital, including long-term debt and equity. If we are unable to recover any material amount of our costs in rates in a timely manner or recover an adequate return on capital, our results of operations, financial condition and cash flows could be materially adversely affected.

Our revenues and earnings are substantially affected by regulatory proceedings known as rate cases. During those cases, the Louisiana Public Service Commission determines our rate base, depreciation rates, operation and maintenance costs, and administrative and general costs that we may recover from our retail customers through our rates. These proceedings may examine, among other things, the prudence of our operation and maintenance practices, level of subject expenditures, allowed rates of return, and previously incurred capital expenditures. The Louisiana Public Service Commission has the authority to disallow costs found not to have been prudently incurred. These regulatory proceedings typically involve multiple parties, including governmental bodies and officials, consumer advocacy groups, and various consumers of energy, who have differing concerns but who have the common objective of limiting rate increases or reducing rates. Rate cases generally have long timelines, which may be limited by statute. Decisions are typically subject to appeal, potentially leading to additional uncertainty.

On October 14, 2009, the Louisiana Public Service Commission unanimously approved our new retail rate plan, which is based upon a unanimous settlement of the parties in our rate case. The Louisiana Public Service Commission’s decision to approve the new retail rate plan could be appealed or otherwise challenged. A successful appeal or challenge to the approval could have a material adverse effect on our results of operations, financial condition and cash flows.

We are exposed to certain risks related to the design, construction and operation of Rodemacher Unit 3. This project has technology risk, fuel supply risk, and general contractor and certain material subcontractor performance risk.

Rodemacher Unit 3 is designed to utilize circulating fluidized bed generating technology. Under the amended and restated engineering, procurement and construction contract (the “Amended EPC Contract”) between us and Shaw Contractors, Inc., a subsidiary of The Shaw Group Inc. (“Shaw”), executed on May 12, 2006, for engineering, procurement, and construction of Rodemacher Unit 3, Shaw is liable for liquidated damages for non-performance. However, our ability to collect any damages for breach is contingent on the

demonstration of such damages and on Shaw’s financial abilities. Failure by Shaw to meet its obligations under the Amended EPC Contract could have a material adverse impact on the plant’s efficiency, in-service date, and final cost. The Amended EPC Contract does not protect us against force majeure events or design/specification oversight which may result in increased and potentially unrecoverable costs. Although we currently deliver coal via rail to the Rodemacher facility, plans are for Rodemacher Unit 3 to primarily use petroleum coke, which can be delivered most economically via barges on the Mississippi and Red Rivers, requiring a conveyor system which crosses an interstate and local highways. Navigable waterway events such as blockages or low water, or conveyor outages could impact our ability to transport and deliver fuel to Rodemacher Unit 3.

The global financial crisis may negatively impact our business and financial condition.

The continued credit crisis and related turmoil in the global financial system may have an impact on our business and financial condition. We may face significant challenges if conditions in the financial markets do not improve. Our ability to access the capital markets may be severely restricted at a time when we would like, or need, to do so, which could have a material impact on its ability to fund capital expenditures or debt service or on our flexibility to react to changing economic and business conditions. If our credit ratings were to be downgraded by Moody’s or by Standard & Poor’s, we would be required to pay additional fees and higher interest rates under its bank credit and other debt agreements. During 2008, our pension plan portfolio experienced significant losses and may experience further losses in the future. The losses, in conjunction with plan funding requirements, could result in required pension plan contributions significantly higher and earlier than previously anticipated, which could have a material negative impact on our results of operations and financial condition. Further, the credit crisis could have a material negative impact on our lenders or our customers causing them to fail to meet their obligations to us or to delay payment of such obligations. Additionally, the crisis could lead to reduced electricity usage, which could have a material negative impact on our results of operations and financial condition.

Our future electricity sales and corresponding base revenue and cash flows could be adversely affected by general economic conditions.

General market conditions can negatively impact the businesses of our industrial customers, resulting in decreased power purchases and lower base revenue. The current U.S. recession could lead to reduced power usage by our customers. Our largest industrial customers, specifically those who manufacture wood and paper products (who generated base revenue of approximately $24.6 million in 2008), have experienced a downturn in their respective markets. The downturn in residential home construction has caused a significant reduction in the demand and prices for lumber and other wood products. The paper industry has been vulnerable in recent years as a result of a mature market with pressures from overseas manufacturers. Reduced production or the shut down of any of these customers’ facilities could substantially reduce our base revenue.

The high cost of energy, in general, has become problematic in many industries and has increased interest by industrial customers in switching to alternative sources of energy, including on-site power generation. Also, retail customers may consume less electricity due to increased conservation efforts or increased electric usage efficiency.

The Louisiana Public Service Commission conducts fuel audits that could result in our making substantial refunds of previously recorded revenue.

Generally, fuel and purchased power expenses are recovered through the Louisiana Public Service Commission-established fuel adjustment clause, which enables us to pass on to our customers substantially all such charges. Recovery of fuel adjustment clause costs is subject to a periodic fuel audit by the Louisiana Public Service Commission.

We currently have fuel adjustment clause filings for 2003 through 2008 subject to review. In July 2006, the Louisiana Public Service Commission commenced a periodic fuel audit of our fuel adjustment clause filings for

January 2003 through December 2004. Management is currently unable to predict the timing of the fuel cost audits for the open years 2005 through 2008. We could be required to make a substantial refund of previously recorded revenue as a result of these audits, and such refund could result in a material adverse effect on our results of operations, financial condition, and cash flows. The most recent audit completed by the Louisiana Public Service Commission covered 2001 and 2002 and resulted in a refund of $16.0 million to our retail customers in the first quarter of 2005.

We are subject to market risk associated with economic hedges relating to open natural gas contracts. Our parent company has risk management policies which cannot eliminate all risk involved in its energy commodity activities.

We utilize economic hedges to mitigate the risks associated with a fixed-price wholesale power contract that is not included in the fuel adjustment clause. Any realized gain or loss attributable to these hedges is recorded on the income statement as a component of operating revenue, net. Accordingly, changes in the market value of these hedging arrangements caused by natural gas price volatility will impact our results of operations, financial condition, and cash flows.

We have also entered into economic hedge positions to mitigate the volatility in fuel costs passed through to our retail customers. When these positions close, actual gains or losses are deferred and included in the fuel adjustment clause in the month the physical contract settles. However, recovery of any of these fuel adjustment clause costs is subject to, and may be disallowed as part of, a prudency review or a periodic fuel audit conducted by the Louisiana Public Service Commission.

We manage our exposure to energy commodity activities by establishing and enforcing risk limits and risk management procedures. These risk limits and risk management procedures may not be as effective as planned, particularly if intentional misconduct is involved, and cannot eliminate all risk associated with these activities.

Nonperformance of our power purchase agreements and transmission constraints could have a material adverse effect on our results of operations, financial condition, and cash flows.

We do not supply all of our customers’ power from the generation facilities we own and must purchase additional energy and capacity from the wholesale power market in order to meet customers’ demands. During 2008, we met approximately 55.7% of our energy needs with purchased power. A 500-megawatt power purchase agreement with BE Louisiana LLC, an indirect wholly-owned subsidiary of JPMorgan Chase & Co. (“Bear Energy”), which expires in 2009, and other short- and long-term power purchase agreements provided approximately 40.4% of our capacity needs in 2008. We plan to meet its 2009 energy and capacity needs with the Bear Energy 500-megawatt contract; a 235-megawatt contract with Acadia Power Partners, LLC; a 20-megawatt long-term contract with Sabine River Authority; a 200-megawatt contract with NRG Power Marketing, Inc.; and a 41-megawatt wholesale power contract with the city of Natchitoches. If any provider of additional energy or capacity does not perform under their respective contracts, we would have to replace these supply sources with alternative market sources, the terms of which may not be as favorable and could increase the ultimate cost of power to our customers.

Because of our location on the transmission grid, we rely on two main suppliers of electric transmission when accessing external power markets. At times, physical constraints limit the amount of purchased power these transmission providers can deliver into our service territory, which in turn can affect capacity or power purchases under long-term contracts, as well as spot market power purchases. If the amount of purchased power actually delivered into our transmission system were less than the amount of power contracted for delivery, we may rely on our own generation facilities to meet customer demand. Our incremental generation cost at that time could be higher than the cost to purchase power from the wholesale power market, thereby increasing our customers’ ultimate cost. In addition, the Louisiana Public Service Commission may not allow us to recover part or all of our incremental generation cost, which could be substantial.

We are subject to the fluctuation in the market prices of various commodities which may increase the cost of producing power.

We purchase coal, lignite, natural gas and fuel oil under long-term contracts and on the spot market. Historically, the markets for oil, natural gas and coal have been volatile and are likely to remain volatile in the future. Our retail rates include a fuel adjustment clause that enables us to adjust rates for monthly fluctuations in the cost of fuel and purchased power. However, recovery of any of these fuel adjustment clause costs is subject to, and may be disallowed as part of, a prudency review or a periodic fuel audit conducted by the Louisiana Public Service Commission.

Our generation facilities are susceptible to unplanned outages, significant maintenance requirements and interruption of fuel deliveries.

The operation of power generation facilities involves many risks, including breakdown or failure of equipment, fuel supply interruption and performance below expected levels of output or efficiency. Some of our facilities were originally constructed many years ago. Older equipment, even if maintained in accordance with good engineering practices, may require significant expenditures to operate at peak efficiency or availability. If we fail to make adequate expenditures for equipment maintenance, we risk incurring more frequent unplanned outages, higher than anticipated operating and maintenance expenditures, increased fuel or power purchase costs, and potentially the loss of revenue related to competitive opportunities.

Our generating facilities are fueled primarily by coal, natural gas, and lignite. The deliverability of these fuel sources may be constrained due to such factors as higher demand, production shortages, weather-related disturbances or lack of transportation capacity. If the suppliers are unable to deliver the contracted volume of fuel, we would have to replace any deficiency with alternative sources, which may not be as favorable and could increase the ultimate cost of fuel to customers. Fuel and purchased power expenses are recovered from customers through the fuel adjustment clause, which is subject to refund until either a prudency review or a periodic fuel audit is conducted by the Louisiana Public Service Commission.

In 2005, the Federal Energy Regulatory Commission’s authority was expanded to include the establishment and enforcement of mandatory reliability standards on the transmission system, as well as the capacity to impose fines and civil penalties on those who fail to comply with those standards.

The Energy Policy Act of 2005 authorizes the creation of an Electric Reliability Organization with authority to establish and enforce mandatory reliability standards, subject to Federal Energy Regulatory Commission approval, for users of the nation’s transmission system. In July 2006, the Federal Energy Regulatory Commission named the North American Electric Reliability Corporation, or NERC, as the Electric Reliability Organization. The Federal Energy Regulatory Commission has approved more than 95 reliability standards developed by NERC. A final order was issued by the Federal Energy Regulatory Commission in March 2007, and in June 2007, the Federal Energy Regulatory Commission began enforcing compliance with these standards. New standards are continually being developed and existing standards will be modified as needed.

As these standards continue to be adopted and modified, they may impose additional compliance requirements on our operations which may result in an increase in capital expenditures and operating expenses. Failure to comply with the reliability standards approved by the Federal Energy Regulatory Commission can result in the imposition of fines and civil penalties.

Our costs of compliance with environmental laws and regulations are significant. The costs of compliance with new environmental laws and regulations, as well as the incurrence of incremental environmental liabilities, could be significant to us.

We are subject to extensive environmental oversight by federal, state, and local authorities and are required to comply with numerous environmental laws and regulations related to air quality, water quality, waste management, natural resources, and health and safety. We are also required to obtain and comply with numerous governmental permits in operating our facilities. Existing environmental laws, regulations and permits could be revised or reinterpreted, and new laws and regulations could be adopted or become applicable to us. For example, Congress is considering climate change legislation that, if ultimately enacted, could impose a cap on CO₂ emissions by electric generating units such as ours and subject electric generating units to an emissions allowance-based trading system. We may incur significant capital expenditures or additional operating costs to comply with these revisions, reinterpretations, and new requirements. If we fail to comply with these revisions, reinterpretations, and requirements, we could be subject to civil or criminal liabilities and fines or may be forced to shut down or reduce productions from our facilities.

Environmental advocacy groups, states, other organizations, some government agencies, and the new presidential administration are focusing considerable attention on CO₂ emissions from power generation facilities and their potential role in climate change. Future changes in environmental regulations governing CO₂ could make some of our electric generating units uneconomical to maintain or operate. In addition, any legal obligation that would require us to substantially reduce our CO₂ emissions beyond present levels could require extensive mitigation efforts and could raise uncertainty about the future viability of fossil fuels as an energy source for new and existing electric generation facilities.

We may request recovery from our retail customers of our costs to comply with new environmental laws and regulations. If revenue relief were to be approved by the Louisiana Public Service Commission, then our retail rates could increase. If the Louisiana Public Service Commission were to deny our request to recover all or part of its environmental compliance costs, such an adverse decision could have a material effect on our results of operations, financial condition, and cash flows.

We operate in a highly regulated environment and adverse regulatory decisions or changes in applicable regulations could have a material adverse effect on our business or result in significant additional costs.

Our business is subject to extensive federal, state, and local energy, environmental and other laws and regulations. The Louisiana Public Service Commission regulates our retail operations, and the Federal Energy Regulatory Commission regulates our wholesale operations. The construction, planning, and siting of our power plants and transmission lines also are subject to the jurisdiction of the Louisiana Public Service Commission and the Federal Energy Regulatory Commission. Additional regulatory authorities have jurisdiction over some of our operations and construction projects including the United States Environmental Protection Agency, the United States Bureau of Land Management, the United States Fish and Wildlife Services, the United States Department of Energy, the United States Army Corps of Engineers, the United States Department of Homeland Security, the Occupational Safety and Health Administration, the United States Department of Transportation, the Louisiana Department of Environmental Quality, the Louisiana Department of Health and Hospitals, the Louisiana Department of Natural Resources, the Louisiana Department of Public Safety, regional water quality boards, and various local regulatory districts.

We must periodically apply for licenses and permits from these various regulatory authorities and abide by their respective orders. Should we be unsuccessful in obtaining necessary licenses or permits or should these regulatory authorities initiate any investigations or enforcement actions or impose penalties or disallowances on us, our business could be adversely affected. Existing regulations may be revised or reinterpreted and new laws and regulations may be adopted or become applicable to us or our facilities in a manner that may have a detrimental effect on our business or result in significant additional costs because of our need to comply with those requirements.

Our operating results are affected by weather conditions and may fluctuate on a seasonal and quarterly basis.

Weather conditions directly influence the demand for electricity, particularly kilowatt hours sales to residential customers. In our service territory, demand for power peaks during the hot summer months. As a result, our financial results may fluctuate on a seasonal basis. In addition, we have sold less power, and consequently earned less income, when weather conditions were milder. Unusually mild weather in the future could adversely impact our results of operations, financial condition, and cash flows.

Severe weather, including hurricanes and winter storms, can be destructive, causing outages and property damage that can potentially result in additional expenses and lower revenue.

The abandonment of the Rodemacher Unit 3 project or termination of the Amended EPC Contract could result in unrecoverable costs.

We may determine that our decision to construct, own and operate Rodemacher Unit 3 is no longer justified due to changes in circumstances or for other reasons. If we decided to abandon the project, the Louisiana Public Service Commission may not allow us to recover some or all of our incurred costs. The Amended EPC Contract allows us to terminate the agreement at our sole discretion, but exercise of this termination right would require us to pay termination costs, subject to specified limitations. At June 30, 2009, the maximum termination costs would have been $790.7 million payable to Shaw. Termination costs under the Amended EPC Contract could result in a material adverse effect on our results of operations, financial condition, and cash flows.

Our retail electric rates and business practices are regulated by the Louisiana Public Service Commission.

Our retail rates for residential, commercial, and industrial customers and other retail sales are regulated by the Louisiana Public Service Commission, which conducts an annual review of our earnings and regulatory return on equity. We file annual monitoring reports with the Louisiana Public Service Commission for 12-month periods ended September 30. We could be required to make a substantial refund of previously recorded revenue as a result of the Louisiana Public Service Commission review, and such refund could result in a material adverse effect on our results of operations, financial condition, and cash flows.

A downgrade in our credit rating could result in an increase in our borrowing costs and a reduced pool of potential investors and funding sources.

While our senior unsecured debt ratings are currently investment grade, in recent years such ratings have been downgraded or put on negative watch by Moody’s and Standard & Poor’s. We cannot assure that such current debt ratings will remain in effect for any given period of time or that one or more of such debt ratings will not be lowered or withdrawn entirely by a rating agency. Credit ratings are not recommendations to buy, sell, or hold securities and each rating should be evaluated independently of any other rating. If Moody’s or Standard & Poor’s were to downgrade our long-term ratings, particularly below investment grade, the value of our debt securities would likely be adversely affected, and our borrowing cost would likely increase. In addition, we would likely be required to pay higher interest rates in future debt financings and be subject to more onerous debt covenants, and our pool of potential investors and funding sources could decrease.

Unless we inform you otherwise in the prospectus supplement, we anticipate using net proceeds from the sale of the debt securities offered by this prospectus for general corporate purposes. The purposes may include, but are not limited to:

We may from time to time offer debt securities consisting of our unsecured debentures, notes or other evidences of indebtedness in one or more series at an aggregate initial offering price not to exceed $500 million pursuant to this prospectus. We refer to these debentures, notes or other evidences of indebtedness as the “debt securities.” The following description highlights the general terms and provisions of the debt securities. When we offer debt securities in the future, the prospectus supplement will explain the particular terms of those securities and the extent to which these general provisions may apply.

The debt securities will be issued under an indenture, dated as of October 1, 1988, between us (as successor to Cleco Utility Group, Inc.) and Bankers Trust Company, as supplemented and amended. The Bank of New York Mellon Trust Company, N.A. is the current trustee under the indenture. Copies of the indenture and the Agreement of Resignation, Appointment and Acceptance under which The Bank of New York succeeded Bankers Trust Company as trustee under the indenture are included among the exhibits to the registration statement of which this prospectus is a part.

We have summarized selected provisions of the indenture below. You should read the indenture filed as an exhibit to the registration statement of which this prospectus is a part for any provisions that may be important to you. In the summary below, we have included references to section numbers of the indenture so that you can easily locate these provisions. In describing the provisions of the indenture, we use the term “corporation” as it is defined in the indenture. The indenture defines “corporation” to include corporations, associations, companies, including limited liability companies, and business trusts.

The indenture does not limit the principal amount of unsecured debentures, notes or other obligations that we may issue under it from time to time in one or more series. The term “indenture securities,” as used in this prospectus, refers to all of these obligations issued and issuable under the indenture from time to time and includes the debt securities. We may issue additional indenture securities, in addition to the debt securities, in the future under the indenture. At June 30, 2009, we had $598.8 million principal amount of indenture securities issued and outstanding under the indenture, consisting of $73.8 million principal amount of insured quarterly notes, $75.0 million principal amount of 5.375% notes due 2013, $50.0 million principal amount of 4.95% notes due 2015, $250.0 million principal amount of 6.65% notes due 2018 and $150.0 million principal amount of 6.50% notes due 2035. In August 2009, we redeemed approximately $49.5 million principal amount of our outstanding insured quarterly notes.

A prospectus supplement relating to any series of debt securities being offered by this prospectus will include specific terms relating to the offering. These terms will include some or all of the following:

We may sell the debt securities, including original issue discount securities, at a substantial discount below their stated principal amount. If there are any special United States federal income tax considerations applicable to debt securities we sell at an original discount, we will describe them in the prospectus supplement. In addition, we will describe in the prospectus supplement any special United States federal income tax considerations and any other special considerations for any debt securities we sell which are denominated in a currency or currency unit other than U.S. dollars.

The debt securities will rank equally with all of our other unsecured and unsubordinated indebtedness. As of June 30, 2009, we had an aggregate of $959.7 million of unsecured and unsubordinated indebtedness that would rank equal with the debt securities. As of June 30, 2009, we had no outstanding first mortgage bonds issued under and secured by an Indenture of Mortgage, dated as of July 1, 1950, between us and The Bank of New York Mellon Trust Company, N.A., as trustee. In this prospectus, we sometimes refer to this Indenture of Mortgage as the “mortgage indenture.” We may issue first mortgage bonds in the future under the mortgage indenture, and holders of the first mortgage bonds issued under the mortgage indenture would have a prior claim on certain of our material assets upon our dissolution, winding up, liquidation or reorganization.

In addition, holders of the debt securities will be effectively subordinated to the claims of creditors and any preferred equity holders of our subsidiaries with respect to the assets and operations of such subsidiaries. As of June 30, 2009, our sole subsidiary, Cleco Katrina/Rita Hurricane Recovery Funding LLC, had $172.2 million of indebtedness outstanding.

So long as any indenture securities remain outstanding, the indenture prohibits us from creating or permitting any mortgage, lien or similar encumbrance, which we call a “mortgage,” on any of our properties, unless we secure the indenture securities equally and ratably with the mortgage being created or permitted. This prohibition does not apply to:

We and the trustee may modify the indenture without the consent of holders of indenture securities to do certain things, such as to establish the form and terms of a series of indenture securities or to add to our covenants under the indenture for the benefit of holders. (Section 901) Additionally, with certain exceptions, we and the trustee may modify the indenture or the rights of the holders of indenture securities if we obtain the consent of the holders of at least 50% in principal amount of all outstanding indenture securities affected by the modification. However, modifications of provisions of the indenture involving the following items will not be effective against any holder without the holder’s consent:

With respect to indenture securities of a particular series, the following are events of default under the indenture:

An event of default for a particular series of indenture securities does not necessarily constitute an event of default for any other series of indenture securities issued under the indenture.

If an event of default occurs and continues, either the trustee or the holders of at least 25% of the series may declare those indenture securities due and payable. Holders of a majority of a series of indenture securities may waive past defaults for that series under certain circumstances. (Section 502) We must furnish annually to the trustee a statement regarding performance by us of certain of our obligations under the indenture and any related defaults. (Section 1005)

With certain exceptions, we will be discharged from our obligations under the indenture with respect to any series of indenture securities by

In addition to the requirements described above, we must also deliver an officers’ certificate and opinion of counsel to the trustee stating that all conditions precedent relating to the satisfaction and discharge of the indenture have been fulfilled. (Section 401)

The indenture allows us to consolidate or merge with another corporation or sell, lease or convey all or substantially all of our assets to another corporation only if

We will describe any restrictive covenants for any series of debt securities, other than those described above under “—Ranking; Limitations on Mortgages and Liens,” in the prospectus supplement.

Unless we inform you otherwise in the prospectus supplement, the covenants contained in the indenture and the debt securities will not contain provisions permitting the holders of debt securities to require prepayment in the event of a change in control of us or our parent company, Cleco Corporation, or in the event we or Cleco Corporation enter into one or more highly leveraged or other transactions, regardless of whether a rating decline results therefrom, nor will any such events be deemed to be Events of Default under the terms of the indenture or the debt securities.

Unless otherwise indicated in the prospectus supplement, the debt securities will be issued only in fully registered form, without coupons, in denominations of $1,000 or integral multiples of $1,000. (Section 302) You will not have to pay a service charge to transfer or exchange debt securities, but we may require you to pay taxes or other governmental charges for exchanges involving transfers under the terms of the indenture. (Section 305)

Unless otherwise indicated in the prospectus supplement, each series of debt securities will be represented by one or more fully registered global notes deposited with, or on behalf of, The Depository Trust Company, as depositary. Unless and until it is exchanged in whole or in part for debt securities in certificated form, no global note may be transferred except as a whole by the depositary or by a nominee of the depositary.

So long as the depositary or its nominee is the registered owner of a global note, the depositary or its nominee, as the case may be, will be considered the sole owner or holder of the debt securities represented by the global note for all purposes under the indenture. Except as provided below, beneficial owners of a global note representing debt securities will not be entitled to have the debt securities registered in their names, will not receive or be entitled to receive physical delivery of the debt securities in definitive form and will not be considered the registered holders of the debt securities under the indenture. Furthermore, no global note representing debt securities will be exchangeable or transferable. Accordingly, each beneficial owner must rely on the procedures of the depositary and, if that beneficial owner is not a “participant,” as described below, on the procedures of the participant through which the beneficial owner owns its interest, to exercise any rights of a holder under the indenture. We understand that under existing industry practices, if we were to request any action of holders or if an owner of a beneficial interest in a global note representing debt securities were to desire to take any action that a holder is entitled to take under the indenture,

Each global note will be exchangeable for debt securities in certificated form only if:

If one of the above events occurs, each global note will be exchangeable for debt securities in certificated form of like tenor and of an equal aggregate principal amount. The certificated debt securities will be registered in the name or names of the beneficial owners of the global note or global notes as the depositary instructs the trustee. It is expected that instructions may be based upon directions received by the depositary from participants with respect to ownership of beneficial interests in global notes.

The laws of some states may require that certain purchasers of securities take physical delivery of securities in definitive form. These laws may impair your ability to own, transfer or pledge beneficial interests in global notes.

The depositary will act as securities depositary for the debt securities. The debt securities will be issued as fully-registered securities registered in the name of Cede & Co., the depositary’s partnership nominee, or such other name as may be requested by an authorized representative of the depositary. One fully-registered global note will be issued for each issue of debt securities, each in the aggregate principal amount of the issue, and will be deposited with the depositary. If however, the aggregate principal amount of any issue exceeds $500 million,

one global note will be issued with respect to each $500 million of principal amount, and an additional certificate will be issued with respect to any remaining principal amount of such issue.

The depositary, the world’s largest securities depository, is a limited-purpose trust company organized under the New York Banking Law, a “banking organization” within the meaning of the New York Banking Law, a member of the Federal Reserve System, a “clearing corporation” within the meaning of the New York Uniform Commercial Code, and a “clearing agency” registered pursuant to the provisions of Section 17A of the Securities Exchange Act of 1934. The depositary holds and provides asset servicing for over 3.5 million issues of U.S. and non-U.S. equity issues, corporate and municipal debt issues, and money market instruments from over 100 countries that its “participants” deposit with the depositary. The depositary also facilitates the post-trade settlement among direct participants of sales and other securities transactions in deposited securities through electronic computerized book-entry changes in participants’ accounts, thereby eliminating the need for physical movement of securities certificates. Direct participants of the depositary include U.S. and non-U.S. securities brokers and dealers, banks, trust companies, clearing corporations and certain other organizations.

The depositary is a wholly-owned subsidiary of The Depository Trust & Clearing Corporation (“DTCC”). DTCC is the holding company for the depositary, National Securities Clearing Corporation and Fixed Income Clearing Corporation, all of which are registered clearing agencies. DTCC is owned by the users of its regulated subsidiaries. Access to the depositary’s system is also available to others such as U.S. and non-U.S. securities brokers and dealers, banks, trust companies and clearing corporations that clear through or maintain a custodial relationship with a direct participant, either directly or indirectly. The rules applicable to the depositary and its participants are on file with the Securities and Exchange Commission.

Purchases of debt securities under the depositary’s system must be made by or through direct participants, which will receive a credit for those debt securities on the depositary’s records. The ownership interest of each beneficial owner of each debt security represented by a global note is, in turn, to be recorded on the records of direct participants and indirect participants. Beneficial owners of debt securities will not receive written confirmation from the depositary of their purchase, but beneficial owners are expected to receive written confirmations providing details of the transaction, as well as periodic statements of their holdings, from the direct participants or indirect participants through which the beneficial owners entered into the transaction. Transfers of ownership interests in a global note representing debt securities are to be accomplished by entries made on the books of participants acting on behalf of beneficial owners. Beneficial owners of a global note representing debt securities will not receive debt securities in certificated form representing their ownership interests in the debt securities, except in the event that use of the book-entry system for those debt securities is discontinued.

To facilitate subsequent transfers, all global notes representing debt securities that are deposited with, or on behalf of, the depositary are registered in the name of the depositary’s nominee, Cede & Co., or such other name as may be requested by an authorized representative of the depositary. The deposit of global notes with or on behalf of the depositary and their registration in the name of Cede & Co., or such other nominee, do not effect change in beneficial ownership. The depositary has no knowledge of the actual beneficial owners of the global notes representing the debt securities. Instead, the depositary’s records reflect only the identity of the direct participants to whose accounts the debt securities are credited, which may or may not be the beneficial owners. The direct and indirect participants will remain responsible for keeping account of their holdings on behalf of their customers.

Conveyance of notices and other communications by the depositary to direct participants, by direct participants to indirect participants, and by direct participants and indirect participants to beneficial owners, will be governed by arrangements among them, subject to any statutory or regulatory requirements as may be in effect from time to time.

Neither the depositary nor Cede & Co. (nor any other depositary nominee) will consent or vote with respect to the global notes representing the debt securities, unless authorized by a direct participant in accordance with

the depositary’s procedures. Under its usual procedures, the depositary mails an omnibus proxy to us as soon as possible after the applicable record date. The omnibus proxy assigns Cede & Co.’s consenting or voting rights to those direct participants to whose accounts the debt securities are credited on the applicable record date (identified in a listing attached to the omnibus proxy).

We will make principal, premium, if any, and/or interest, if any, payments on the global notes representing the debt securities to Cede & Co., or such other nominee as may be requested by an authorized representative of the depositary. The depositary’s practice is to credit direct participants’ accounts upon the depositary’s receipt of funds and corresponding detail information from us or the trustee, on the payable date in accordance with their respective holdings shown on the depositary’s records. Payments by participants to beneficial owners will be governed by standing instructions and customary practices, as is the case with securities held for the accounts of customers in bearer form or registered in “street name,” and will be the responsibility of the applicable participant and not of the depositary, the trustee, any agent or us, subject to any statutory or regulatory requirements as may be in effect from time to time. Payment of principal, premium, if any, and/or interest, if any, to Cede & Co. (or such other nominee as may be requested by an authorized representative of the depositary, if any) will be our responsibility and that of the trustee. Disbursement of such payments to direct participants will be the responsibility of the depositary, and disbursement of such payments to the beneficial owners will be the responsibility of direct participants and indirect participants.

If applicable, redemption notices shall be sent to the depositary. If less than all of the debt securities within an issue are being redeemed, the depositary’s practice is to determine by lot the amount of the interest of each direct participant in such issue to be redeemed.

A beneficial owner shall give notice of any option to elect to have its debt securities purchased or tendered, through its participant, to the trustee, and shall effect delivery of the applicable debt securities by causing the direct participant to transfer the participant’s interest in the global note representing the debt securities, on the depositary’s records, to the trustee. The requirement for physical delivery of debt securities in connection with an optional tender or a mandatory purchase will be deemed satisfied when the ownership rights in the global note or global notes representing the debt securities are transferred by direct participants on the depositary’s records and followed by a book-entry credit of tendered debt securities to the trustee’s depositary account.

The depositary may discontinue providing its services as securities depositary with respect to the debt securities at any time by giving reasonable notice to the trustee or us. In the event that a successor securities depositary is not obtained, debt securities in certificated form are required to be printed and delivered. Similarly, we may decide to discontinue use of the system of book-entry transfers through the depositary or a successor securities depositary. In that event, debt securities in certificated form will be printed and delivered.

The information in this section concerning the depositary and the depositary’s system has been obtained from sources that we believe to be reliable, but we take no responsibility for the accuracy thereof.

Neither we, the trustee nor any underwriter, dealer or agent will have any responsibility for the performance by the depositary or its participants or indirect participants of their obligations.

The Bank of New York Mellon Trust Company, N.A. is the trustee under the indenture. The trustee also may act as a depositary of funds for, make loans (subject to certain limitations) to, and perform other services for us in the normal course of business, including acting as trustee under other indentures of ours. The corporate trust office of the trustee is located at 601 Poydras Street, Suite 2225, New Orleans, Louisiana 70130-6050.

The trustee generally will be under no obligation to exercise any of its rights or powers under the indenture at the request or direction of any of the holders, unless the holders offer a reasonable indemnity to the trustee

against any costs or liabilities the trustee might incur in compliance with such request. (Section 603) The holders of a majority of a series of indenture securities generally may direct the time, method and place of conducting any proceedings for any remedy available to the trustee, or exercising any trust or power conferred on the trustee with respect to the indenture securities. (Section 512) The right of a holder to institute a proceeding under the indenture is subject to certain conditions, but each holder has an absolute right to receive payment of principal, premium, if any, and interest, if any, when due and to institute suit for the enforcement of payment of these amounts. This right is subject to certain limited exceptions in the case of interest. (Section 508) Within 90 days after a default with respect to any series of indenture securities, the trustee is required to give the holders notice of the default, unless the default has been cured or waived. The trustee may withhold this notice if it determines that it is in the best interest of the holders to do so, but the trustee may not withhold notice in this manner with respect to a default in the payment of principal, premium, if any, and/or interest, if any, or sinking fund installment on any indenture security. (Section 602)

The trustee may resign from its duties with respect to the indenture at any time. We may remove the trustee in certain circumstances, and the holders of a majority of a series of indenture securities may remove the trustee with respect to that series at any time. If the trustee resigns, is removed or becomes incapable of acting as trustee or a vacancy occurs in the office of the trustee for any reason, a successor trustee will be appointed in accordance with the provisions of the indenture. (Section 610)

The indenture contains the provisions required by the Trust Indenture Act of 1939 with reference to the disqualification of the trustee if the trustee has or acquires any “conflicting interest,” as that term is defined in the indenture. (Section 608) In the event the trustee becomes a creditor of ours within four months prior to a default, or subsequent to such a default, the indenture also contains certain limitations on the right of the trustee to obtain payment of claims in certain cases, or to realize on certain property held by it as security for such claim. (Section 613)

We will describe the terms of any offering of debt securities in the prospectus supplement, including:

We may change the initial public offering price and any discount or concessions allowed or reallowed to dealers from time to time.

If we use underwriters to sell our debt securities, the underwriting agreement will provide that the obligations of the underwriters are subject to certain conditions precedent and that the underwriters will be obligated to purchase all of the offered debt securities if any are purchased. In connection with the sale of debt securities, underwriters may receive compensation from us or from purchasers of debt securities for whom they may act as agents in the form of discounts, concessions or commissions. Underwriters may sell debt securities to or through dealers, and dealers may receive compensation in the form of discounts, concessions or commissions from the underwriters and/or commissions from the purchasers for whom they may act as agents.

If we use a dealer to sell debt securities, we will sell the debt securities to the dealer as principal. The dealer may then resell the debt securities to the public at varying prices to be determined by the dealer at the time of resale. These dealers may be deemed underwriters, as such term is defined in the Securities Act of 1933, of the debt securities they offer and sell. If we elect to use a dealer to sell debt securities, we will provide the name of the dealer and the terms of the transaction in the prospectus supplement.

Debt securities may also be offered and sold in connection with a remarketing upon their purchase, in accordance with a redemption or repayment by their terms or otherwise by one or more remarketing firms acting as principals for their own accounts or as our agents. We will identify any remarketing firm, the terms of any remarketing agreement and the compensation to be paid to a remarketing firm in the prospectus supplement. Remarketing firms may be deemed underwriters under the Securities Act of 1933.

Underwriters, agents and dealers participating in the distribution of our debt securities may be deemed to be underwriters, and any discounts and commissions received by them and any profit realized by them on resale of debt securities may be deemed to be underwriting discounts and commissions under the Securities Act of 1933.

We may enter into agreements with the underwriters, agents, purchasers, dealers or remarketing firms who participate in the distribution of our debt securities that will require us to indemnify them against specified

liabilities, including liabilities under the Securities Act of 1933, or to contribute to payments that they or any person controlling them may be required to make for those liabilities. Underwriters, agents or dealers may be our customers. They may also engage in transactions with us or perform services for us or for our affiliates in the ordinary course of business.

Unless we inform you otherwise in the applicable prospectus supplement, each series of our debt securities will be a new issue with no established trading market. We may elect to list any series of debt securities on an exchange. However, we are not obligated to do so. It is possible that one or more underwriters may make a market in a series of our debt securities. However, they will not be obligated to do so and may discontinue market making at any time without notice. We cannot assure you that a liquid trading market for the debt securities will develop.

In connection with an offering, the underwriters or agents may purchase and sell our debt securities in the open market. These transactions may include over-allotment and stabilizing transactions and purchases to cover syndicate short positions created in connection with the offering. Stabilizing transactions consist of bids or purchases for the purpose of preventing or retarding a decline in the market price of the debt securities. Syndicate short positions involve the sale by the underwriters or agents of a greater number of debt securities than they are required to purchase from us in the offering. The underwriters also may impose a penalty bid, in which selling concessions allowed to syndicate members or other broker dealers in respect of the debt securities sold in the offering for their account may be reclaimed by the syndicate if the debt securities are repurchased by the syndicate in stabilizing or covering transactions. These activities may stabilize, maintain or otherwise affect the market price of the debt securities, which may be higher than the price that might otherwise prevail in the open market, and these activities, if commenced, may be discontinued at any time. These transactions may be effected on the New York Stock Exchange, in the over-the-counter market or otherwise.

We file annual, quarterly and current reports and other information with the Securities and Exchange Commission (“SEC”) in accordance with the information requirements of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). You may read and copy any document we file with the SEC at the SEC’s Public Reference Room at 100 F Street, NE, Washington, DC 20549. You may obtain further information regarding the operation of the SEC’s Public Reference Room by calling the SEC at 1-800-SEC-0330. Our filings are also available to the public over the Internet at the SEC’s web site located at http://www.sec.gov and the web site of our parent company, Cleco Corporation, located at http://www.cleco.com. In addition, you may inspect our reports at the offices of the New York Stock Exchange, Inc. at 20 Broad Street, New York, New York 10005.

The SEC allows us to “incorporate by reference” into this prospectus information we file with the SEC. This means we can disclose important information to you by referring you to the documents containing the information. The information we incorporate by reference is considered to be part of this prospectus, unless we update or supersede that information by the information contained in this prospectus, a prospectus supplement or information that we file subsequently that is incorporated by reference into this prospectus. We are incorporating by reference into this prospectus the following documents that we have filed with the SEC, and our future filings with the SEC under Sections 13(a), 13(c), 14 or 15(d) of the Exchange Act (excluding information deemed to be furnished and not filed with the SEC) until the offering of the debt securities is completed (File No. 1-05663):

This prospectus is part of a registration statement we have filed with the SEC relating to our debt securities. As permitted by SEC rules, this prospectus does not contain all of the information included in the registration statement and the accompanying exhibits and schedules we file with the SEC. You should read the registration statement and the exhibits and schedules for more information about us and our debt securities. The registration statement, exhibits and schedules are also available at the SEC’s Public Reference Room or through its web site.

You may also obtain a copy of our filings with the SEC at no cost by writing to or telephoning us at:

The validity of any debt securities offered hereby will be passed upon for us by Baker Botts L.L.P., Houston, Texas. Wade A. Hoefling, our Senior Vice President — General Counsel and Director of Regulatory Compliance, will pass upon all matters of Louisiana law in this connection. At September 30, 2009, Mr. Hoefling beneficially owned 11,013 shares of Cleco Corporation common stock (including shares held under employee benefit plans). None of such shares were issued or granted in connection with the offering of the securities offered by this prospectus. Any underwriters or agents will be advised about the validity of the debt securities by their own counsel, which counsel will be named in the applicable prospectus supplement.

The financial statements and financial statement schedule of Cleco Power LLC incorporated in this prospectus by reference to the Annual Report on Form 10-K of Cleco Power LLC for the year ended December 31, 2008 have been so incorporated in reliance on the report of PricewaterhouseCoopers LLP, an independent registered public accounting firm, given on the authority of said firm as experts in auditing and accounting.


	Per note		Total

Public offering price(1)		%	$
Underwriting discount		%	$
Proceeds, before expenses, to us		%	$


	Page
Prospectus supplement
Summary		S-1
Risk factors		S-5
Capitalization		S-6
Use of proceeds		S-6
Summary financial information		S-7
Description of the notes		S-8
Certain U.S. federal income tax considerations		S-13
Underwriting		S-17
Where you can find more information		S-20
Validity of the notes		S-20
Experts		S-20

Prospectus
About this prospectus		1
Cautionary statement regarding forward-looking statements		2
The company		4
Ratio of earnings to fixed charges		4
Risk factors		5
Use of proceeds		11
Description of the debt securities		11
Plan of distribution		20
Where you can find more information		22
Validity of securities		23
Experts		23


	September 30, 2010
(In thousands)	Actual		As adjusted		As further adjusted

	(Unaudited)
Cash and cash equivalents	$	27,384	$	3,213	$

Current portion of long-term debt	$	36,440	$	12,269	$

Long-term debt:
Notes offered hereby		—		—		250,000
Other long-term debt, excluding current portion and Storm Recovery Bonds		1,044,499		1,044,499
Storm Recovery Bonds		143,307		143,307

Total long-term debt (excluding current portion)		1,187,806		1,187,806
Member’s equity		1,233,737		1,233,737

Total capitalization (excluding current portion of long-term debt)	$	2,421,543	$	2,421,543	$


	Year ended December 31,						Nine months ended September 30,
(In thousands)	2009		2008		2007		2010		2009


Summary of Operations:
Operating revenue, net	$	843,599	$	1,071,682	$	1,025,419	$	867,202	$	654,124
Operating expenses		732,137		950,716		919,420		637,037		563,522
Operating income		111,462		120,966		105,999		230,165		90,602
Net income		111,166		113,832		84,673		123,584		88,776


	December 31,						September 30,
(In thousands)	2009		2008		2007		2010		2009


Balance Sheet Data:
Cash and cash equivalents	$	138,113	$	91,542	$	11,944	$	27,384	$	35,010
Total assets		3,363,962		3,041,597		2,306,482		3,613,032		3,174,815
Long-term debt due within one year		11,478		63,546		—		36,440		11,478
Long-term debt, net		1,225,299		1,076,819		769,103		1,187,806		1,120,238
Member’s equity		1,009,849		929,178		816,110		1,233,737		987,119
Total capitalization		2,235,148		2,005,997		1,585,213		2,421,543		2,107,357


J.P. Morgan		Credit Agricole CIB		KeyBanc Capital Markets


	Year ended December 31,									Nine months ended September 30,
(In thousands, except for Ratio)	2009			2008			2007			2010			2009


Other Financial Data:
Depreciation expense	$	77,064		$	76,420		$	78,522		$	77,941		$	57,339
Interest expense		84,735			66,925			42,710			61,158			59,443
Capital expenditures		249,252			334,652			509,198			75,660			190,047
Net utility property		2,240,776			2,038,928			1,719,170			2,569,533			2,202,839
Ratio of earnings to fixed charges(1)		2.46	x		3.10	x		3.64	x		3.89	x		2.68x


Underwriter	Principal amount

J.P. Morgan Securities LLC	$
Credit Agricole Securities (USA) Inc.
KeyBanc Capital Markets Inc.
Banc of America Securities LLC
Credit Suisse Securities (USA) LLC

Total	$	250,000,000


BofA Merrill Lynch		Credit Suisse