Exhibit 12(B) PP&L, INC. AND SUBSIDIARIES, CONSOLIDATED COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES (Millions of Dolllars) 1998 1997 1996 1995 1994 ---------- ---------- ---------- ---------- ---------- Fixed charges, as defined: Interest on long-term debt ........................ $188 $195 $207 $213 $214 Interest on short-term debt and other interest ............................. 14 17 11 18 18 Amortization of debt discount, expense and premium - net................................ 2 2 2 2 2 Interest on capital lease obligations Charged to expense ............................ 8 9 13 15 12 Capitalized ................................... 2 2 2 2 1 Estimated interest component of operating rentals ............................... 18 15 8 8 6 Proportionate share of fixed charges of 50-percent-or-less-owned persons ............. 1 1 1 1 1 ---------- ---------- ---------- ---------- ---------- Total fixed charges ....................... $233 $241 $244 $259 $254 ========== ========== ========== ========== ========== Earnings, as defined: Net income (a).................................... $409 $348 $357 $352 $243 Less undistributed income of less than 50-percent-owned persons ................... - - - - - ---------- ---------- ---------- ---------- ---------- 409 348 357 352 243 Add (Deduct): Income taxes ...................................... 273 248 251 287 181 Amortization of capitalized interest on capital leases ...................... 2 2 4 6 9 Total fixed charges as above (excluding capitalized interest on capital lease obligations) ................... 231 239 243 257 253 ---------- ---------- ---------- ---------- ---------- Total earnings ............................ $915 $837 $855 $902 $686 ========== ========== ========== ========== ========== Ratio of earnings to fixed charges ........................................... 3.93 3.47 3.50 3.48 2.70 ========== ========== ========== ========== ========== (a) 1998 net income excluding extraordinary items.