EX-12.B 6 exhibit12b.htm EXHIBIT 12(B) exhibit12b.htm
Exhibit 12(b)
PPL ENERGY SUPPLY, LLC AND SUBSIDIARIES
 
COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES
(Millions of Dollars)
 
                   
             
2014 (a)
  
2013 (a)
  
2012 (a)
  
2011 (a)
  
2010 (a)
Earnings, as defined:
                              
   
Income (Loss) from Continuing Operations Before
                              
     
Income Taxes (b)
  
$
 303
  
$
 (420)
  
$
 665
  
$
 1,061
  
$
 860
   
Adjustments to reflect earnings from equity method
                              
     
investments on a cash basis
    
 
    
 
    
 
    
 1
    
 7
           
 303
    
 (420)
    
 665
    
 1,062
    
 867
                                         
   
Total fixed charges as below
    
 161
    
 226
    
 238
    
 259
    
 426
       
Less:
                              
       
Capitalized interest
    
 22
    
 35
    
 37
    
 38
    
 27
       
Interest expense and fixed charges related to
                              
         
discontinued operations
    
 10
    
 14
    
 12
    
 6
    
 169
   
Total fixed charges included in Income (Loss) from
                              
     
Continuing Operations Before Income Taxes
    
 129
    
 177
    
 189
    
 215
    
 230
                                         
       
Total earnings
  
$
 432
  
$
 (243)
  
$
 854
  
$
 1,277
  
$
 1,097
                                         
Fixed charges, as defined:
                              
   
Interest charges (c)
  
$
 156
  
$
 207
  
$
 214
  
$
 223
  
$
 387
   
Estimated interest component of operating rentals
    
 5
    
 19
    
 24
    
 36
    
 38
   
Fixed charges of majority-owned share of 50% or
                              
     
less-owned persons
    
 
    
 
    
 
    
 
    
 1
                                         
       
Total fixed charges (d)
  
$
 161
  
$
 226
  
$
 238
  
$
 259
  
$
 426
                                         
Ratio of earnings to fixed charges (b)
    
2.7
    
(1.1)
    
3.6
    
4.9
    
2.6
                                         

(a)
  
Years 2010 through 2014 reflect the reclassification of certain PPL Montana hydroelectric generating facilities and related assets as Discontinued Operations.  See Note 8 to the Financial Statements for additional information.
(b)
  
To facilitate the sale of the hydroelectric generating facilities referred to in (a) above, in December 2013, PPL Montana terminated a lease agreement which resulted in a $697 million charge.  See Note 8 to the Financial Statements for additional information.  As a result of these transactions, earnings were lower, which resulted in less than one-to-one coverage.  The adjusted amount of the deficiency, or the amount of fixed charges in excess of earnings, was $469 million.
(c)
  
Includes interest on long-term and short-term debt, as well as amortization of debt discount, expense and premium - net.
(d)
  
Interest on unrecognized tax benefits is not included in fixed charges.
     

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