Exhibit 12(b) | ||||||||||||||||||||
PPL ENERGY SUPPLY, LLC AND SUBSIDIARIES | ||||||||||||||||||||
COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES | ||||||||||||||||||||
(Millions of Dollars) | ||||||||||||||||||||
2013 | 2012 | 2011 | 2010 | 2009 | ||||||||||||||||
Earnings, as defined: | ||||||||||||||||||||
Income (Loss) from Continuing Operations Before | ||||||||||||||||||||
Income Taxes (a) | $ | (371) | $ | 738 | $ | 1,212 | $ | 881 | $ | (13) | ||||||||||
Adjustments to reflect earnings from equity method | ||||||||||||||||||||
investments on a cash basis | 1 | 7 | 1 | |||||||||||||||||
(371) | 738 | 1,213 | 888 | (12) | ||||||||||||||||
Total fixed charges as below | 226 | 238 | 259 | 426 | 364 | |||||||||||||||
Less: | ||||||||||||||||||||
Capitalized interest | 36 | 47 | 47 | 33 | 44 | |||||||||||||||
Interest expense and fixed charges related to | ||||||||||||||||||||
discontinued operations | 3 | 147 | 102 | |||||||||||||||||
Total fixed charges included in Income (Loss) from | ||||||||||||||||||||
Continuing Operations Before Income Taxes | 190 | 191 | 209 | 246 | 218 | |||||||||||||||
Total earnings | $ | (181) | $ | 929 | $ | 1,422 | $ | 1,134 | $ | 206 | ||||||||||
Fixed charges, as defined: | ||||||||||||||||||||
Interest charges (b) | $ | 207 | $ | 214 | $ | 223 | $ | 387 | $ | 321 | ||||||||||
Estimated interest component of operating rentals | 19 | 24 | 36 | 38 | 42 | |||||||||||||||
Fixed charges of majority-owned share of 50% or | ||||||||||||||||||||
less-owned persons | 1 | 1 | ||||||||||||||||||
Total fixed charges (c) | $ | 226 | $ | 238 | $ | 259 | $ | 426 | $ | 364 | ||||||||||
Ratio of earnings to fixed charges (d) | (0.8) | 3.9 | 5.5 | 2.7 | 0.6 |
(a) | In September 2013, PPL Montana executed a definitive agreement to sell certain hydroelectric generating facilities. The sale is not expected to close before the second half of 2014. To facilitate the sale, PPL Montana terminated a lease agreement which resulted in a $697 million charge, included in "Loss on lease termination" on the Statement of Income. See Note 8 to the Financial Statements for additional information. | |
(b) | Includes interest on long-term and short-term debt, as well as amortization of debt discount, expense and premium - net. | |
(c) | Interest on unrecognized tax benefits is not included in fixed charges. | |
(d) | The lease termination referred to in (a) above resulted in earnings that were less than fixed charges for 2013. The total amount of fixed charges for 2013 was $226 million and the total amount of earnings for the same period was $(181) million. The amount of the deficiency, or the amount of fixed charges in excess of earnings, was $407 million. In January 2011, PPL Energy Supply distributed its 100% membership interest in PPL Global to PPL Energy Supply's parent, PPL Energy Funding. As a result, PPL Global's operating results were reclassified as Discontinued Operations. Upon reflecting this reclassification, earnings were less than fixed charges for 2009. See Note 9 in PPL Energy Supply's 2011 Form 10-K for additional information. The total amount of fixed charges for this period was $364 million and the total amount of earnings was $206 million. The amount of the deficiency, or the amount of fixed charges in excess of earnings, was $158 million. |
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