1 EXHIBIT (12) CMS ENERGY CORPORATION Ratio of Earnings to Fixed Charges (Millions of Dollars) Six Months Ended Years Ended December 31 June 30, 1997 1996 1995 1994 1993 1992 ------------------------------------------------------------------ (b) Earnings as defined (a) - ----------------------- Consolidated net income (loss) $ 138 $ 240 $ 204 $ 179 $ 155 $(297) Income taxes 79 139 118 92 75 (146) Exclude equity basis subsidiaries (36) (85) (57) (18) (6) 10 Fixed charges as defined, adjusted to exclude capitalized interest of $7, $8, $8, $6, $5, and $3 million for the six months ended June 30, 1997 and for the years ended December 31, 1996, 1995, 1994, 1993 and 1992, respectively 146 275 268 226 241 225 -------------------------------------------------------------- Earnings as defined $ 327 $ 569 $ 533 $ 479 $ 465 $(208) ============================================================== Fixed charges as defined (a) - ---------------------------- Interest on long-term debt $ 126 $ 230 $ 224 $ 193 $ 204 $ 169 Estimated interest portion of lease rental 5 10 9 9 11 16 Other interest charges 22 43 42 30 32 43 -------------------------------------------------------------- Fixed charges as defined $ 153 $ 283 $ 275 $ 232 $ 247 $ 228 ============================================================== Ratio of earnings to fixed charges 2.13 2.01 1.94 2.07 1.88 - ============================================================= NOTES: (a) Earnings and fixed charges as defined in instructions for Item 503 of Regulation S-K. (b) For the year ended December 31, 1992, fixed charges exceeded earnings by $441 million. Earnings as defined include a $520 million pretax loss on the settlement of MCV Power Purchases, $(15) million for potential customer refunds and other reserves related to 1992 but recorded in 1991, and $6 million relating to CMS Generation Company's reduction in its investment in The Oxford Energy Company. The ratio of earnings to fixed charges would have been 1.33 excluding these amounts.