I always use HE ammo for the gas cannon, as some sort of grenade launcher and relatively light compared to the torpedos. Very useful against the weaker aliens. For night missions, the phosphor rounds work well to illuminate dark areas before advancing. You'll have to target an object, like a piece of coral, rock, wall, machinery, etc.. Otherwise it'll say that you have no line of fire. Other than for lighting, i never understood what else incindiary ammo was for.