EXHIBIT 12 HOUSTON INDUSTRIES INCORPORATED AND SUBSIDIARIES COMPUTATION OF RATIOS OF EARNINGS TO FIXED CHARGES (THOUSANDS OF DOLLARS) Six Twelve Months Ended Months Ended June 30, 1994 June 30, 1994 Fixed Charges as Defined: (1) Interest on Long-Term Debt.................. $ 173,462 $ 359,927 (2) Other Interest.............................. 11,657 15,728 (3) Preferred Dividends Factor of Subsidiary........................ 26,348 52,810 (4) Interest Component of Rentals Charged to Operating Expense......... 1,909 4,151 ------------- ----------- (5) Total Fixed Charges......................... $ 213,376 $ 432,616 ============= =========== Earnings as Defined: (6) Income Before Cumulative Effect of Change in Accounting for Postemployment Benefits.............. $ 172,203 $ 460,974 (7) Income Taxes .............................. 100,554 271,641 (8) Fixed Charges (line 5)...................... 213,376 432,616 ------------- ----------- (9) Earnings Before Income Taxes and Fixed Charges.................... $ 486,133 $ 1,165,231 ============= =========== Preferred Dividends Factor of Subsidiary: (10) Preferred Stock Dividends of Subsidiary........................... $ 16,676 $ 33,214 (11) Ratio of Pre-Tax Income to Net Income (line 6 plus line 7 divided by line 6)............ 1.58 1.59 ------------- ----------- (12) Preferred Dividends Factor of Subsidiary (line 10 times line 11)............................. $ 26,348 $ 52,810 ============= =========== Ratio of Earnings to Fixed Charges (line 9 divided by line 5)..................... 2.28 2.69