**Exhibit      12**

**VECTREN      UTILITY HOLDINGS, INC.**

**COMPUTATION      OF RATIO OF EARNINGS TO FIXED CHARGES**

**(In      Thousands, Except Ratio)**

|                                                                                                                    |   | Year                  Ended December 31 |
|-------------------------------------------------------------------------------------------------------------------------|--------|-----------------------------------------|
|                                                                                                                    |   | 2006                                    |   | 2005 |   | 2004 |   | 2003 |   | 2002 |   |
|                                                                                                                    |   |                                    |   |   |   |   |   |   |   |   |   |
| Earnings:                  (1)                                                                                          |   |                                    |   |   |   |   |   |   |   |   |   |
|                      Net income (2)                                                                      |   | $                                       | 91,377 |   | $ | 95,128 |   | $ | 83,146 |   | $ | 85,587 |   | $ | 97,137 |   |
|                      Income taxes                                                                        |   |                                    | 47,691 |   |   | 57,500 |   |   | 53,035 |   |   | 51,582 |   |   | 46,772 |   |
|                      Equity in losses (income) of equity investee, net of                  distributions |   |                                    | -                      |   |   | -    |   |   | (128 | ) |   | 511 |   |   | 1,859 |   |
|                      Fixed Charges (See Below) (3)                                                       |   |                                    | 80,973 |   |   | 71,007 |   |   | 68,363 |   |   | 66,699 |   |   | 70,693 |   |
|                      Less: Preferred stock dividend                                                      |   |                                    | -                      |   |   | 4 |   |   | 13 |   |   | 23 |   |   | 32 |   |
|     Total                  adjusted earnings                                                        |   | $                                       | 220,041 |   | $ | 223,631 |   | $ | 204,403 |   | $ | 204,356 |   | $ | 216,429 |   |
| Fixed                  charges: (3)                                                                                     |   |                                    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                      Total interest expense                                                              |   | $                                       | 77,538 |   | $ | 69,942 |   | $ | 67,408 |   | $ | 66,135 |   | $ | 69,119 |   |
|                      Interest component of rents                                                         |   |                                    | 807 |   |   | 1,061 |   |   | 942 |   |   | 541 |   |   | 1,542 |   |
|                      Preferred stock dividend                                                            |   |                                    | -                      |   |   | 4 |   |   | 13 |   |   | 23 |   |   | 32 |   |
|     Total                  fixed charges                                                            |   | $                                       | 78,345 |   | $ | 71,007 |   | $ | 68,363 |   | $ | 66,699 |   | $ | 70,693 |   |
|                                                                                                                    |   |                                    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Ratio                  of earnings to fixed charges                                                                     |   |                                    | 2.8 |   |   | 3.1 |   |   | 3.0 |   |   | 3.1 |   |   | 3.1 |   |

| (1)   | For                the purposes of computing these ratios, earnings consist of pretax                net                income before income (losses) from equity investees, fixed charges,                and                less preferred stock dividends of a consolidated subsidiary. |
|-----------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (2)   | Net                income, as defined, is before preferred stock dividend requirement                of                subsidiary and cumulative effect of change in accounting                principle |
|-----------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (3)   | Fixed                charges consist of total interest, amortization of debt discount,                premium                and expense, the estimated portion of interest implicit in rentals,                and                preferred stock dividends of a consolidated                subsidiary. |
|-----------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|