Exhibit 12(a)
MINNESOTA POWER & LIGHT COMPANY
COMPUTATION OF RATIOS OF EARNINGS TO FIXED CHARGES AND
SUPPLEMENTAL RATIOS OF EARNINGS TO FIXED CHARGES(1)
FOR THE YEAR ENDED
-----------------------------------------------
DECEMBER 31,
-----------------------------------------------
1991 1992 1993 1994 1995
-------- --------- -------- -------- ---------
(IN THOUSANDS EXCEPT RATIOS)
Income from
continuing
operations per
consolidated
statement of
income $ 70,854 $ 67,821 $ 64,374 $ 59,465 $ 61,857
Add (deduct)
Current income
tax expense 16,371 29,147 29,277 24,116 13,356
Deferred income
tax expense
(benefit) 9,734 (1,113) 1,084 (981) (11,336)
Deferred
investment
tax credits (1,615) (1,568) (2,035) (2,478) (865)
Undistributed
income from
less than
50% owned
equity
investments (4,941) (5,733) (6,009) (7,547) (9,124)
Minority
interest (129) 2,684 (83) (879) 260
-------- --------- -------- -------- ---------
90,274 91,238 86,608 71,696 54,148
-------- --------- -------- -------- ---------
Fixed charges
Interest on
long-term
debt 44,516 44,008 44,647 48,137 45,713
Capitalized
interest - 422 3,010 - 1,395
Other interest
charges - net 8,008 6,455 1,501 7,382 7,934
Interest
component of
all rentals 5,695 5,728 5,729 5,737 3,670
-------- --------- -------- -------- ---------
Total fixed
charges 58,219 56,613 54,887 61,256 58,712
-------- --------- -------- -------- ---------
Earnings before
income taxes
and fixed
charges
(excluding
capitalized
interest) $148,493 $147,429 $138,485 $132,952 $111,465
======== ========= ======== ======== =========
Ratio of earnings
to fixed
charges 2.55 2.60 2.52 2.17 1.90
======== ========= ======== ======== =========
Earnings before
income taxes
and fixed
charges
(excluding
capitalized
interest) $148,493 $147,429 $138,485 $132,952 $111,465
Supplemental
charges 16,846 16,017 15,149 14,370 13,519
-------- --------- -------- -------- ---------
Earnings before
income taxes and
fixed and
supplemental
charges
(excluding
capitalized
interest) $165,339 $163,446 $153,634 $147,322 $124,984
======== ========= ======== ======== =========
Total fixed
charges $ 58,219 $ 56,613 $ 54,887 $ 61,256 $ 58,712
Supplemental
charges 16,846 16,017 15,149 14,370 13,519
-------- --------- -------- -------- ---------
Fixed and
supplemental
charges $ 75,065 $ 72,630 $ 70,036 $ 75,626 $ 72,231
======== ========= ======== ======== =========
Supplemental ratio
of earnings to
fixed
charges(2) 2.20 2.25 2.19 1.95 1.73
======== ========= ======== ======== =========
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(1) Ratios for prior periods have been restated to reflect
discontinued operations.
(2) The supplemental ratio of earnings to fixed charges includes
the Company's obligation under a contract with Square Butte
Electric Cooperative (Square Butte) which extends through
2007, pursuant to which the Company is purchasing 71 percent
of the output of a generating unit capable of generating up
to 470 megawatts. The Company is obligated to pay Square
Butte all of Square Butte's leasing, operating and debt
service costs (less any amounts collected from the sale of
power or energy to others) that shall not have been paid by
Square Butte when due. See Note 12 to the Company's 1995
Consolidated Financial Statements in the Company's Form 8-K
dated February 16, 1996, incorporated herein by reference.