Exhibit 12(a)
LG&E and KU Energy LLC
Ratio of Earnings to Fixed Charges
For the Periods as Shown
($ millions)
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| 2006 |
| 2007 |
| 2008 |
| 2009 |
| January |
| November |
| March 31, |
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Earnings: |
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Income from continuing operations before income taxes |
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| $ | 310 |
| $ | 332 |
| $ | (1,536 | ) | $ | (1,235 | ) | $ | 300 |
| $ | 70 |
| $ | 136 |
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Exclude amounts reflected in line above: |
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Undistributed income of Electric Energy, Inc. |
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| 2 |
| 5 |
| — |
| (11 | ) | 4 |
| — |
| 1 |
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Loss on impairment of Goodwill |
|
|
| — |
| — |
| (1,806 | ) | (1,493 | ) | — |
| — |
| — |
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Mark to market impact of derivative instruments(1) |
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|
| — |
| — |
| (34 | ) | 19 |
| 20 |
| (2 | ) | — |
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Add fixed charges (see below) |
|
|
| 161 |
| 170 |
| 199 |
| 186 |
| 158 |
| 25 |
| 38 |
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Total Earnings |
| (A) |
| $ | 469 |
| $ | 497 |
| $ | 503 |
| $ | 436 |
| $ | 434 |
| $ | 97 |
| $ | 173 |
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Fixed charges: |
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Interest expense |
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| $ | 143 |
| $ | 155 |
| $ | 184 |
| $ | 176 |
| $ | 153 |
| $ | 24 |
| $ | 36 |
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Estimated interest component of rental expense(2) |
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| 4 |
| 4 |
| 5 |
| 5 |
| 5 |
| 1 |
| 2 |
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Estimated discontinued operations interest component of rental expense(2) |
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| 10 |
| 10 |
| 10 |
| 5 |
| — |
| — |
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Preferred stock dividends |
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| 4 |
| 1 |
| — |
| — |
| — |
| — |
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Total Fixed Charges |
| (B) |
| $ | 161 |
| $ | 170 |
| $ | 199 |
| $ | 186 |
| $ | 158 |
| $ | 25 |
| $ | 38 |
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Ratio of Earnings to Fixed Charges |
| (A) ÷ (B) |
| 2.91 |
| 2.92 |
| 2.53 |
| 2.34 |
| 2.75 |
| 3.88 |
| 4.55 |
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(1) Represents unrealized gains or losses on derivative instruments recorded in the statements of income.
(2) Represents one-third of rentals charged to operating expense.