**AEP        TEXAS NORTH COMPANY AND SUBSIDIARY**

**Computation        of Consolidated Ratios of Earnings to Fixed Charges **

**(in        thousands except ratio data)**

|                                                                                                                 |   | **Year                  Ended December 31,** |    |
|----------------------------------------------------------------------------------------------------------------------|--------|----------------------------------------------|---------|
|                                                                                                                 |   | **2002**                                     |    | **2003** |   | **2004** |   | **2005** |   | **2006** |   |
| **EARNINGS                  (LOSS)**                                                                                 |   |                                    |    |    |   |    |   |    |   |    |   |
| Income                  (Loss) Before Income Taxes                                                                   |   | $                                            | (25,780 | )  | $ | 85,926 |   | $ | 70,168 |   | $ | 60,053 |   | $ | 19,197 |   |
| Fixed                  Charges (as below)                                                                            |   |                                         | 21,884  |   |   | 23,135 |   |   | 22,715 |   |   | 20,987 |   |   | 19,206 |   |
| **Total                  Earnings (Loss)**                                                                           |   | $                                            | (3,896  | )  | $ | 109,061 |   | $ | 92,883 |   | $ | 81,040 |   | $ | 38,403 |   |
|                                                                                                                 |   |                                         |    |   |   |   |   |   |   |   |   |   |   |   |   |   |
| **FIXED                  CHARGES**                                                                                   |   |                                         |    |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Interest                  Expense                                                                                    |   | $                                            | 20,845  |   | $ | 22,049 |   | $ | 21,985 |   | $ | 19,817 |   | $ | 17,619 |   |
| Credit                  for Allowance for Borrowed Funds Used                     During Construction |   |                                         | 379     |   |   | 367 |   |   | 217 |   |   | 378 |   |   | 568 |   |
| Estimated                  Interest Element in Lease Rentals                                                    |   |                                         | 660     |   |   | 719 |   |   | 513 |   |   | 792 |   |   | 1,019 |   |
| **Total                  Fixed Charges**                                                                             |   | $                                            | 21,884  |   | $ | 23,135 |   | $ | 22,715 |   | $ | 20,987 |   | $ | 19,206 |   |
|                                                                                                                 |   |                                         |    |   |   |   |   |   |   |   |   |   |   |   |   |   |
| **Ratio                  of Earnings (Loss) to Fixed Charges**                                                       |   |                                         | (0.17   | ) |   | 4.71 |   |   | 4.08 |   |   | 3.86 |   |   | 1.99 |   |
|                                                                                                                 |   |                                         |    |   |   |   |   |   |   |   |   |   |   |   |   |   |