**EXHIBIT 12.1**

**PUBLIC SERVICE ELECTRIC AND GAS COMPANY****COMPUTATION OF RATIOS OF EARNINGS TO FIXED CHARGES**

 

|                                                        |   | **For the Quarters****Ended March 31,** |   | **For the Years Ended****December 31,** |   |
|-------------------------------------------------------------|--------|-----------------------------------------|--------|-----------------------------------------|--------|
|                                                        |   |                                         |   |                                         |   |
|                                                        |   | **2003**                                |   | **2002**                                |   | **2002** |   | **2001** |   | **2000** |   | **1999** |   | **1998** |   |
|                                                        |   |                                         |   |                                         |   |  |   |  |   |  |   |  |   |  |   |
| Earnings as Defined in Regulation S-K (A):                  |   |                                    |   |                                    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Pre-tax Income from Continuing Operations                   |   | $                                       | 157    |                                    | $      | 110 |   | $ | 320 |   | $ | 324 |   | $ | 994 |   | $ | 1,163 |   | $ | 1,006 |   |
| Fixed Charges                                               |   |                                    | 97     |                                    |   | 103 |   |   | 422 |   |   | 479 |   |   | 447 |   |   | 442 |   |   | 436 |   |
| AFUDC                                                       |   |                                    | — |                                    |   | — |   |   | (1 | ) |   | (2 | ) |   | (1 | ) |   | (7 | ) |   | (44 | ) |
| Preferred Securities Dividends Requirements of Subsidiaries |   |                                    | (3     | )                                       |   | (3 | ) |   | (13 | ) |   | (24 | ) |   | (46 | ) |   | (46 | ) |   | (12 | ) |
|                                                        |   |                                         |        |                                    |        |  |   |  |  |   |  |  |   |  |  |   |  |  |   |  |  |   |
| Earnings                                                    |   | $                                       | 251    |                                    | $      | 210 |   | $ | 728 |   | $ | 777 |   | $ | 1,394 |   | $ | 1,552 |   | $ | 1,386 |   |
|                                                        |   |                                         |        |                                    |        |  |   |  |  |   |  |  |   |  |  |   |  |  |   |  |  |   |
| Fixed Charges as Defined in Regulation S-K (B)              |   |                                    |   |                                    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Interest Expense                                            |   | $                                       | 94     |                                    | $      | 100 |   | $ | 407 |   | $ | 452 |   | $ | 398 |   | $ | 394 |   | $ | 390 |   |
| Interest Factor in Rentals                                  |   |                                    | — |                                    |   | — |   |   | 2 |   |   | 3 |   |   | 3 |   |   | 2 |   |   | 2 |   |
| Preferred Securities Dividends Requirements of Subsidiaries |   |                                    | 3      |                                    |   | 3 |   |   | 13 |   |   | 24 |   |   | 46 |   |   | 46 |   |   | 44 |   |
|                                                        |   |                                         |        |                                    |        |  |   |  |  |   |  |  |   |  |  |   |  |  |   |  |  |   |
| Total Fixed Charges                                         |   | $                                       | 97     |                                    | $      | 103 |   | $ | 422 |   | $ | 479 |   | $ | 447 |   | $ | 442 |   | $ | 436 |   |
|                                                        |   |                                         |        |                                    |        |  |   |  |  |   |  |  |   |  |  |   |  |  |   |  |  |   |
| Ratio of Earnings to Fixed Charges                          |   |                                    | 2.59   |                                    |   | 2.04 |   |   | 1.73 |   |   | 1.62 |   |   | 3.12 |   |   | 3.51 |   |   | 3.18 |   |
|                                                        |   |                                         |        |                                    |        |  |   |  |  |   |  |  |   |  |  |   |  |  |   |  |  |   |

(A)

The term “earnings” shall be defined as pretax income from continuing operations. Add to pretax income the amount of fixed charges adjusted to exclude the amount of any interest capitalized during the period.

(B)

Fixed Charges represent (a) interest, whether expensed or capitalized, (b) amortization of debt discount, premium and expense and (c) an estimate of interest implicit in rentals.