Pacific Gas & Electric (PCG+A) 10-K 2001 FY Annual report

EXHIBIT 12.1

PACIFIC GAS AND ELECTRIC COMPANY

A DEBTOR-IN-POSSESSION

COMPUTATION OF RATIOS OF EARNINGS TO FIXED CHARGES

	Year ended December 31,
(dollars in millions)	2001		2000			1999		1998		1997
Earnings:
Net income (loss)	$	1,015	$	(3,483	)	$	788	$	729	$	768
Adjustments for minority interest in losses of less than 100% owned affiliates and the Company’s equity in undistributed income (losses) of less than 50% owned affiliates		—		—			—		—		—
Income tax expense (benefit)		596		(2,154	)		648		629		609
Net fixed charges		1,019		648			637		673		628
Total earnings	$	2,630	$	(4,989	)	$	2,073	$	2,031	$	2,005
Fixed charges:
Interest on short-term borrowings and long-term debt, net	$	981	$	616		$	604	$	635	$	586
Interest on capital leases		2		2			3		2		2
AFUDC debt		12		6			7		12		17
Earnings required to cover the preferred stock dividend and preferred security distribution requirements of majority owned trust		24		24			24		24		24
Total fixed charges	$	1,019	$	648		$	638	$	673	$	629
Ratios of Earnings to Fixed Charges		2.58		(7.70	)(1)		3.25		3.02		3.19

Note: For the purpose of computing Pacific Gas and Electric Company’s ratios of earnings to fixed charges, “earnings” represent net income adjusted for the minority interest in losses of less than 100% owned affiliates, cash distributions from and equity in undistributed income or loss of Pacific Gas and Electric Company’s less than 50% owned affiliates, income taxes and fixed charges (excluding capitalized interest). “Fixed charges” include interest on long-term debt and short-term borrowings (including a representative portion of rental expense), amortization of bond premium, discount and expense, interest of subordinated debentures held by trust, interest on capital leases, and earnings required to cover the preferred stock dividend requirements.

⁽¹⁾ The ratio of earnings to fixed charges indicates a deficiency of less than one-to-one coverage aggregating $5,637 million.

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