TABLE OF CONTENTS


				Page
			~~Page~~
	Definitions		1
		Filing Format		4
		Forward-Looking Statements		54
PART I
Items 1. & 2.		Business and Properties		76
Item 1A.		Risk Factors		2018
Item 1B.		Unresolved Staff Comments		2524
Item 3.		Legal Proceedings		2624
Item 4.		Mine Safety Disclosures		2624
PART II
Item 5.		Market for Registrant’s Common Equity, Related Stockholder Matters, and Issuer Purchases of Equity Securities		2725
Item 6.		Selected Financial Data		2926
Item 7.		Management’s Discussion and Analysis of Financial Condition and Results of Operations		2927
Item 7A.		Quantitative and Qualitative Disclosures About Market Risk		5248
Item 8.		Financial Statements and Supplementary Data		5551
Item 9.		Changes in and Disagreements with Accountants on Accounting and Financial Disclosure		~~146~~150
Item 9A.		Controls and Procedures		~~146~~150
Item 9B.		Other Information		~~146~~150
~~PART III~~Item 9 C .		Disclosure Regarding Foreign Jurisdictions that Prevent Inspections		150
PART III
Item 10.		Directors, Executive Officers, and Corporate Governance		~~146~~151
Item 11.		Executive Compensation		~~146~~151
Item 12.		Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters		~~146~~151
Item 13.		Certain Relationships and Related Transactions, and Director Independence		~~146~~151
Item 14.		Principal Accountant Fees and Services		~~146~~151
PART IV
Item 15.		Exhibits and Financial Statement Schedules		~~148~~152
Item 16.		Form 10-K Summary		~~158~~161
		Signatures		~~160~~163

DEFINITIONS


ACE		Affordable Clean Energy

AFUDC		Allowance for Funds Used During Construction

~~AGS~~AMT		Appalachia Gathering System is a midstream natural gas asset located in Pennsylvania and West Virginia. DTE Energy purchased 100% of AGS in October 2016, and this asset is part of DTE Energy's Gas Storage and Pipelines segment.Alternative Minimum Tax

AMV		Applicable Market Value

~~ANPR~~ASU		~~Advanced Notice of Proposed Rulemaking~~

~~ARO~~	~~Asset Retirement Obligation~~

~~ASU~~	Accounting Standards Update issued by the FASB

~~CCR~~CAD		Canadian Dollar (C$)

CARB		California Air Resources Board that administers California's Low Carbon Fuel Standard

Carbon emissions		Emissions of carbon containing compounds, including carbon dioxide and methane, that are identified as greenhouse gases

CARES Act		Coronavirus Aid, Relief, and Economic Security Act enacted in March 2020 to assist individuals and employers with the impacts of the COVID-19 pandemic, including certain tax relief provisions

CCR		Coal Combustion Residuals

CFTC		U.S. Commodity Futures Trading Commission

~~CON~~COVID-19		~~Certificate~~Coronavirus disease of ~~Necessity~~2019

DOE		U.S. Department of Energy

DTE Electric		DTE Electric Company ~~(a direct~~(an indirect wholly-owned subsidiary of DTE Energy) and subsidiary companies

DTE Energy		DTE Energy Company, directly or indirectly the parent of DTE Electric, DTE Gas, and numerous non-utility subsidiaries

DTE Gas		DTE Gas Company (an indirect wholly-owned subsidiary of DTE Energy) and subsidiary companies

~~EGU~~DTE Sustainable Generation		DTE Sustainable Generation Holdings, LLC (an indirect wholly-owned subsidiary of DTE Energy) and subsidiary companies

DT Midstream		DT Midstream, Inc., formerly DTE Energy's natural gas pipeline, storage, and gathering non-utility business comprising the Gas Storage and Pipelines segment and certain DTE Energy holding company activity in the Corporate and Other segment, which separated from DTE Energy and became an independent public company on July 1, 2021

EGLE		Michigan Department of Environment, Great Lakes, and Energy, formerly known as Michigan Department of Environmental Quality

EGU		Electric Generating Unit

ELG		Effluent Limitations Guidelines

EPA		U.S. Environmental Protection Agency

Equity units		DTE Energy's ~~2016~~2019 equity units issued in ~~October 2016,~~November 2019, which were used to finance the ~~October 1, 2016~~ Gas Storage and Pipelines ~~acquisition.~~acquisition on December 4, 2019

~~FASB~~ERCOT		Electric Reliability Council of Texas, the independent power market operator responsible for substantially all of the Texas power market.

EWR		Energy Waste Reduction program, which includes a mechanism authorized by the MPSC allowing DTE Electric and DTE Gas to recover through rates certain costs relating to energy waste reduction

FASB		Financial Accounting Standards Board

FERC		Federal Energy Regulatory Commission

~~FOV~~FGD		Flue Gas Desulfurization

FOV		Finding of Violation

DEFINITIONS


FTRs		Financial Transmission Rights are financial instruments that entitle the holder to receive payments related to costs incurred for congestion on the transmission ~~grid.~~grid

GCR		A Gas Cost Recovery mechanism authorized by the MPSC that allows DTE Gas to recover through rates its natural gas ~~costs.~~costs

GHGs		Greenhouse gases

Green Bonds		A financing option to fund projects that have a positive environmental impact based upon a specified set of criteria. The proceeds are required to be used for eligible green ~~expenditures.~~expenditures

~~IRM~~IRS		~~Infrastructure Recovery Mechanism~~

~~IRS~~	Internal Revenue Service

ISO		Independent System Operator

LIBOR		London Inter-Bank Offered Rates

LLC		DTE Energy Corporate Services, LLC, a subsidiary of DTE Energy

~~MDEQ~~	~~Michigan Department of Environmental Quality~~

~~MGP~~	~~Manufactured Gas Plant~~

~~MISO~~	~~Midcontinent Independent System Operator, Inc.~~

~~DEFINITIONS~~



~~MPSC~~MGP		Manufactured Gas Plant

MISO		Midcontinent Independent System Operator, Inc.

MPSC		Michigan Public Service Commission

MTM		Mark-to-market

NAV		Net Asset Value

NEIL		Nuclear Electric Insurance Limited

~~NEXUS~~Net zero		Collective efforts to reduce the carbon emissions of DTE Energy's utility operations and gas suppliers, as well as efforts to offset an amount equivalent to any remaining emissions. Progress towards this goal is estimated and may vary from the calculations of other utility businesses with similar targets

NEXUS		NEXUS Gas Transmission, LLC, a joint venture in which DTE Energy ~~owns~~previously owned a 50% partnership ~~interest.~~interest that separated with DT Midstream effective July 1, 2021

Non-utility		An entity that is not a public utility. Its conditions of service, prices of goods and services, and other operating related matters are not directly regulated by the ~~MPSC.~~MPSC

~~NOV~~	~~Notice of Violation~~

NO_X		Nitrogen Oxides

~~NRC~~NPDES		National Pollutant Discharge Elimination System

NRC		U.S. Nuclear Regulatory Commission

~~PG&E~~PLD		~~Pacific Gas and Electric Corporation~~

~~PLD~~	City of Detroit's Public Lighting Department

Production tax credits		Tax credits as authorized under Sections 45K and 45 of the Internal Revenue Code that are designed to stimulate investment in and development of alternate fuel sources. The amount of a production tax credit can vary each year as determined by the ~~IRS.~~IRS

PSCR		A Power Supply Cost Recovery mechanism authorized by the MPSC that allows DTE Electric to recover through rates its fuel, fuel-related, and purchased power ~~costs.~~costs

~~RDM~~REC		~~A Revenue Decoupling Mechanism authorized by the MPSC that is designed to minimize the impact on revenues of changes in average customer usage.~~

~~REC~~	Renewable Energy Credit

REF		Reduced Emissions Fuel

Registrants		DTE Energy and DTE Electric

Retail access		Michigan legislation provided customers the option of access to alternative suppliers for electricity and natural ~~gas.~~gas

~~RNG~~RPS		Renewable ~~Natural Gas~~Portfolio Standard program, which includes a mechanism authorized by the MPSC allowing DTE Electric to recover through rates its renewable energy costs

RSN		Remarketable Senior Notes

RTO		Regional Transmission Organization

DEFINITIONS


SEC						Securities and Exchange Commission

SGG						Stonewall Gas Gathering is a midstream natural gas asset ~~located in West Virginia.~~that was previously owned 85% by DTE Energy ~~purchased 55% of SGG in October 2016,~~ and ~~this asset is part of DTE Energy's Gas Storage and Pipelines segment.~~separated with DT Midstream effective July 1, 2021

~~Shenango~~SIP						~~Shenango Incorporated is a coke battery plant located in Pittsburgh, PA, that was closed in January 2016 and is included in the Power and Industrial Projects segment.~~State Implementation Plan

SO₂						Sulfur Dioxide

TCJA						Tax Cuts and Jobs Act of 2017, which reduced the corporate Federal income tax rate from 35% to 21%

TCJA rate reduction ~~liability~~						~~Beginning January 1, 2018, as a result~~Reduction in DTE Gas revenue related to Calculation C of the ~~change~~TCJA. DTE Gas' Calculation C case was approved by the MPSC in August 2019 to address all remaining issues relative to the ~~corporate tax rate, DTE Electric~~TCJA, which is primarily the remeasurement of deferred taxes and ~~DTE Gas have reduced revenue and recorded an offsetting regulatory liability.~~how the amounts deferred as Regulatory liabilities flow to ratepayers

Topic 606						FASB issued ASU No. 2014-09, Revenue from Contracts with Customers, as amended

~~TRIA~~Topic 842						FASB issued ASU No, 2016-02, Leases, as amended

TRIA						Terrorism Risk Insurance Program Reauthorization Act of 2015

~~DEFINITIONS~~



TRM						A Transitional Reconciliation Mechanism authorized by the MPSC that allows DTE Electric to recover through rates the deferred net incremental revenue requirement associated with the transition of PLD customers to DTE Electric's distribution ~~system.~~system

~~VEBA~~USD						United States Dollar ($)

VEBA						Voluntary Employees Beneficiary Association

VIE						Variable Interest Entity



Units of Measurement

Bcf		Billion cubic feet of natural gas

~~BTU~~

BTU		British thermal unit, heat value (energy content) of fuel

~~kWh~~

kWh		Kilowatthour of electricity



MDth/d		Million dekatherms per day

MMBtu		One million BTU

MW

MW		Megawatt of electricity

MWh	~~Megawatthour~~	Megawatt-hour of electricity

~~THIS PAGE INTENTIONALLY LEFT BLANK~~

FILING FORMAT

This combined Form 10-K is separately filed by DTE Energy and DTE Electric. Information in this combined Form 10-K relating to each individual Registrant is filed by such Registrant on its own behalf. DTE Electric makes no representation regarding information relating to any other companies affiliated with DTE Energy other than its own subsidiaries. Neither DTE Energy, nor any of DTE Energy’s other subsidiaries (other than DTE Electric), has any obligation in respect of DTE Electric's debt securities, and holders of such debt securities should not consider the financial resources or results of operations of DTE Energy nor any of DTE Energy’s other subsidiaries (other than DTE Electric and its own subsidiaries (in relevant circumstances)) in making a decision with respect to DTE Electric's debt securities. Similarly, none of DTE Electric nor any other subsidiary of DTE Energy has any obligation inwith respect ofto debt securities of DTE Energy. This combined Form 10-K should be read in its entirety. No one section of this combined Form 10-K deals with all aspects of the subject matter of this combined Form 10-K.

FORWARD-LOOKING STATEMENTS

Certain information presented herein includes "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995 with respect to the financial condition, results of operations, and businesses of the Registrants. Words such as "anticipate," "believe," "expect," "may," "could," "projected," "aspiration," "plans," and "goals" signify forward-looking statements. Forward-looking statements are not guarantees of future results and conditions, but rather are subject to numerous assumptions, risks, and uncertainties that may cause actual future results to be materially different from those contemplated, projected, estimated, or budgeted. Many factors may impact forward-looking statements of the Registrants including, but not limited to, the following:

•Risks related to the separation of DT Midstream, including that providing DT Midstream with transition services could adversely affect our business and that the transaction may not achieve some or all of the anticipated benefits;

•the duration and impact of the COVID-19 pandemic on the Registrants and customers;

•impact of regulation by the EPA, EGLE, the FERC, the MPSC, the NRC, and for DTE Energy, the CFTC and CARB, as well as other applicable governmental proceedings and regulations, including any associated impact on rate structures;

•the amount and timing of cost recovery allowed as a result of regulatory proceedings, related appeals, or new legislation, including legislative amendments and retail access programs;

•economic conditions and population changes in the Registrants' geographic area resulting in changes in demand, customer conservation, and thefts of electricity and, for DTE Energy, natural gas;

•the operational failure of electric or gas distribution systems or infrastructure;

~~impact of volatility of prices in the oil and gas markets on DTE Energy's gas storage and pipelines operations;~~

•impact of volatility in prices in the international steel markets and in prices of environmental attributes generated from renewable natural gas investments on the operations of DTE ~~Energy's power~~Vantage (formerly Power and ~~industrial projects operations;~~Industrial Projects);

•the risk of a major safety incident;

•environmental issues, laws, regulations, and the increasing costs of remediation and compliance, including actual and potential new federal and state requirements;

•the cost of protecting assets and customer data against, or damage due to, cyber incidents and terrorism;

•health, safety, financial, environmental, and regulatory risks associated with ownership and operation of nuclear facilities;

~~volatility in the short-term natural gas storage markets impacting third-party storage revenues related to DTE Energy;~~

•volatility in commodity markets, deviations in weather, and related risks impacting the results of DTE Energy's energy trading operations;

•changes in the cost and availability of coal and other raw materials, purchased power, and natural gas;

•advances in technology that produce power, store power, or reduce power consumption;

•changes in the financial condition of significant customers and strategic partners;

•the potential for losses on investments, including nuclear decommissioning and benefit plan assets and the related increases in future expense and contributions;

•access to capital markets and the results of other financing efforts which can be affected by credit agency ratings;

•instability in capital markets which could impact availability of short and long-term financing;

•impacts of inflation and the timing and extent of changes in interest rates;

•the level of borrowings;

•the potential for increased costs or delays in completion of significant capital projects;

•changes in, and application of, federal, state, and local tax laws and their interpretations, including the Internal Revenue Code, regulations, rulings, court proceedings, and audits;

•the effects of weather and other natural phenomena, including climate change, on operations and sales to customers, and purchases from suppliers;

•unplanned outages;

•employee relations and the impact of collective bargaining agreements;

•the availability, cost, coverage, and terms of insurance and stability of insurance providers;

•cost reduction efforts and the maximization of plant and distribution system performance;

•the effects of competition;

•changes in and application of accounting standards and financial reporting regulations;

•changes in federal or state laws and their interpretation with respect to regulation, energy policy, and other business issues;

•successful execution of new business development and future growth plans;

•contract disputes, binding arbitration, litigation, and related appeals;

•the ability of the electric and gas utilities to achieve net zero emissions goals; and

•the risks discussed in the Registrants' public filings with the Securities and Exchange Commission.

New factors emerge from time to time. The Registrants cannot predict what factors may arise or how such factors may cause results to differ materially from those contained in any forward-looking statement. Any forward-looking statements speak only as of the date on which such statements are made. The Registrants undertake no obligation to update any forward-looking statement to reflect events or circumstances after the date on which such statement is made or to reflect the occurrence of unanticipated events.

Part I

Items 1. and 2. Business and Properties

General

In 1995, DTE Energy incorporated in the State of Michigan. DTE Energy's utility operations consist primarily of DTE Electric and DTE Gas. DTE Energy also has ~~three~~two other segments that are engaged in a variety of energy-related businesses.

DTE Electric is a Michigan corporation organized in 1903 and is aan indirect wholly-owned subsidiary of DTE Energy. DTE Electric is a public utility engaged in the generation, purchase, distribution, and sale of electricity to approximately ~~2.2~~2.3 million customers in southeastern Michigan.

DTE Gas is a Michigan corporation organized in 1898 and is aan indirect wholly-owned subsidiary of DTE Energy. DTE Gas is a public utility engaged in the purchase, storage, transportation, distribution, and sale of natural gas to approximately 1.3 million customers throughout Michigan and the sale of storage and transportation capacity.

DTE Energy's other businesses ~~are~~include 1) DTE Vantage, formerly DTE Energy's Power and Industrial Projects segment, which is primarily involved in 1)renewable natural gas ~~pipelines, gathering,~~projects, providing industrial energy services, and ~~storage;~~reduced emissions fuel projects, and 2) ~~power and industrial projects; and 3)~~ energy marketing and trading operations.

On July 1, 2021, DTE Energy completed the separation of its natural gas pipeline, storage, and gathering non-utility business. Effective with the separation, DTE Energy retains no ownership in the new company, DT Midstream.

DTE Electric and DTE Gas are regulated by the MPSC. Certain activities of DTE Electric and DTE Gas, as well as various other aspects of businesses under DTE Energy, are regulated by the FERC. In addition, the Registrants are regulated by other federal and state regulatory agencies including the NRC, the EPA, ~~the MDEQ,~~EGLE, and for DTE Energy, the ~~CFTC.~~CFTC and CARB.

The Registrants' annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K, proxy statements, and all amendments to such reports are available free of charge through the Investor Relations ~~Reports and~~SEC Filings page of DTE Energy's website: www.dteenergy.com, as soon as reasonably practicable after they are filed with or furnished to the SEC.

The DTE Energy Code of Ethics and Standards of Behavior, Board of Directors’ Mission and Guidelines, Board Committee Charters, and Categorical Standards for Director Independence are also posted on the DTE Energy website. The information on DTE Energy’s website is not part of this report or any other report that DTE Energy files with, or furnishes to, the SEC.

Additionally, the public may read and copy any materials the Registrants file electronically with the SEC at www.sec.gov.

Corporate Structure

DTE Energy sets strategic goals, allocates resources, and evaluates performance based on the following structure. For financial information by segment for the last three years, see Note 22 to the Consolidated Financial Statements, ~~in Item 8 of this Report,~~ "Segment and Related Information."

Electric

•The Electric segment consists principally of DTE Electric, which is engaged in the generation, purchase, distribution, and sale of electricity to approximately ~~2.2~~2.3 million residential, commercial, and industrial customers in southeastern Michigan.

Gas

•The Gas segment consists principally of DTE Gas, which is engaged in the purchase, storage, transportation, distribution, and sale of natural gas to approximately 1.3 million residential, commercial, and industrial customers throughout Michigan and the sale of storage and transportation capacity.

Non-utility Operations

~~Gas Storage and Pipelines consists of natural gas pipeline, gathering, transportation, and storage businesses.~~

~~Power and Industrial Projects~~•DTE Vantage is comprised primarily of projects that deliver energy and utility-type products and services to industrial, commercial, and institutional customers, produce reduced emissions fuel, and sell electricity and pipeline-quality gas from renewable energy projects.

•Energy Trading consists of energy marketing and trading operations.

Corporate and Other

•Corporate and Other includes various holding company activities, holds certain non-utility debt, and holds ~~energy-related investments.~~certain investments, including funds supporting regional development and economic growth.

Refer to Management’s Discussion and Analysis in Item 7 of this Report for an in-depth analysis of each segment’s financial results. A description of each business unit follows.

ELECTRIC

Description

DTE Energy's Electric segment consists principally of DTE Electric, an electric utility engaged in the generation, purchase, distribution, and sale of electricity to approximately ~~2.2~~2.3 million customers in southeastern Michigan. DTE Electric is regulated by numerous federal and state governmental agencies, including, but not limited to, the MPSC, the FERC, the NRC, the EPA, and ~~the MDEQ.~~EGLE. Electricity is generated from fossil-fuel plants, a hydroelectric pumped storage plant, a nuclear plant, wind and other renewable assets and is supplemented with purchased power. The electricity is sold, or distributed through the retail access program, to three major classes of customers: residential, commercial, and industrial, throughout southeastern Michigan.

Weather, economic factors, competition, energy waste reduction initiatives, and electricity prices affect sales levels to customers. DTE Electric's peak load and highest total system sales generally occur during the third quarter of the year, driven by air conditioning and other cooling-related demands. DTE Electric's operations are not dependent upon a limited number of customers, and the loss of any one or a few customers would not have a material adverse effect on the results of DTE Electric.

~~See~~The Electric segment also consists of non-utility operations relating to renewable energy projects at DTE Sustainable Generation. These projects have been acquired in support of DTE Energy's renewable energy goals.

For a summary of Electric segment operating revenues by service, see Note 45 to the Consolidated Financial Statements, ~~in Item 8 of the Report,~~ "Revenue."

Fuel Supply and Purchased Power

DTE Electric's power is generated from a variety of fuels and is supplemented with purchased power. DTE Electric expects to have an adequate supply of fuel and purchased power to meet its obligation to serve customers. DTE Electric's generating capability is ~~heavily~~ dependent upon the availability of ~~coal.~~ coal and natural gas.

Coal is purchased from various sources in different geographic areas under agreements that vary in both pricing and terms. DTE Electric expects to obtain the majority of its coal requirements through long-term contracts, with the balance to be obtained through short-term agreements and spot purchases. DTE Electric has long-term and short-term contracts for the purchase of approximately 2419 million tons of low-sulfur western coal and approximately ~~850 thousand~~1.5 million tons of Appalachian coal to be delivered from ~~2019~~2022 to ~~2022.~~2023. All of these contracts have pricing schedules. DTE Electric has ~~approximately 86%~~100% of ~~the~~its expected coal requirements under contract for ~~2019 under contract. Given the geographic diversity of supply, DTE Electric believes it can meet its expected generation requirements.~~2022. DTE Electric leases a fleet of rail cars and has the expected western and eastern coal rail requirements under ~~contract through 2021. Contracts covering expected~~multi-year contracts. DTE Electric's 2022 rail transportation is covered under long-term agreements. DTE Electric expects to cover all of its 2022 vessel transportation requirements for delivery of purchased coal to electric generating facilities through existing agreements. DTE Electric's natural gas supply requirements are ~~under contract~~expected to be met through ~~2019.~~a combination of short and long-term agreements, agreements with local distribution companies, and spot market purchases. Natural gas purchase requirements for 2022 are expected to be approximately 52 Bcf. DTE Electric has contracts for firm gas transportation and storage capacity to ensure reliable and flexible gas supply to its power plants. Given the geographic diversity of supply, DTE Electric believes it can meet its expected generation requirements.

DTE Electric participates in the energy market through MISO. DTE Electric offers its generation in the market on a day-ahead and real-time basis and bids for power in the market to serve its load. DTE Electric is a net purchaser of power that supplements its generation capability to meet customer demand during peak cycles or during major plant outages.

Properties

DTE Electric owns generating facilities that are located in the State of Michigan. Substantially all of DTE Electric's property is subject to the lien of a mortgage.

Generating facilities owned and in service as of December 31, ~~2018~~2021 for the electric segment are shown in the following table:

Location by

Michigan

County

Net Generation Capacity^(a)

Location by
Michigan
County

Net Generation Capacity(a)

Facility

Year in Service

(MW)

Facility

Year in Service

(MW)

Fossil-fueled Steam-Electric

Belle River^(b)

St. Clair

1984 and 1985

1,034

Belle River(b)

St. Clair

1984 and 1985

1,034

Greenwood

St. Clair

1979

785

Greenwood

St. Clair

1979

785

Monroe^(c)

Monroe

1971, 1973, and 1974

3,066

Monroe(c)

Monroe

1971, 1973, and 1974

3,066

River Rouge

Wayne

1958

272

St. Clair

1953, 1954, 1961, and 1969

1,216

St. Clair

1953, 1954, 1961, and 1969

1,065

Trenton Channel

Wayne

1968

495

Trenton Channel

Wayne

1968

495

Dearborn

Wayne

2019

6,868

6,480

Natural gas and Oil-fueled Peaking Units

Various

1966-1971, 1981, 1999, 2002, and 2003

2,033

Natural gas and Oil-fueled Peaking Units

Various

1966-1971, 1981, 1999, 2002, and 2003

1,998

Nuclear-fueled Steam-Electric Fermi 2

Monroe

1988

1,141

Nuclear-fueled Steam-Electric Fermi 2

Monroe

1988

1,141

Hydroelectric Pumped Storage Ludington^(d)

Mason

1973

1,054

Hydroelectric Pumped Storage Ludington(d)

Mason

1973

1,088

Renewables^(e)

Renewables(e)

Wind^(f)

Brookfield Wind Park

Huron

2014

Echo Wind Park

Huron

2014

112

Gratiot Wind Park

Gratiot

2011 and 2012

102

Pinnebog Wind Park

Huron

2016

Thumb Wind Project

Huron and Sanilac

2012

110

450

Wind Utility

Various

2011-2021

1,164

Wind Non-Utility

Various

2019-2020

106

Solar

Various

2010-2021

Utility-Owned SolarCurrents

Various

2010-2016

Utility Scale Solar

Various

2017

1,336

11,610

12,043


~~(a)~~	Represents summer net rating for all units with the exception of renewable facilities. The summer net rating is based on operating experience, the physical condition of units, environmental control limitations, and customer requirements for steam, which would otherwise be used for electric generation. Wind and solar facilities reflect name plate capacity measured in alternating current.


~~(b)~~	~~Represents DTE Electric's 81% interest in Belle River with a total capability of 1,270 MW. See Note 7 to the Consolidated Financial Statements in Item 8 of this Report, "Jointly-Owned Utility Plant."~~


~~(c)~~	~~The Monroe generating plant provided 43% of DTE Electric’s total 2018 power plant generation.~~


~~(d)~~	~~Represents DTE Electric’s 49% interest in Ludington with a total capability of 2,151 MW. See Note 7 to the Consolidated Financial Statements in Item 8 of this Report, "Jointly-Owned Utility Plant."~~


~~(e)~~	~~In addition to the owned renewable facilities described above, DTE Electric has long-term contracts for 481 MW of renewable power generated from wind, solar, and biomass facilities.~~


~~(f)~~	In December 2018, DTE Electric acquired the majority of the Pine River Wind Park with a Net Generation Capacity of 161 MW located in Gratiot County, which is expected to be placed into service in the first quarter of 2019.

(a)Represents summer net rating for all units with the exception of renewable facilities. The summer net rating is based on operating experience, the physical condition of units, environmental control limitations, and customer requirements for steam, which would otherwise be used for electric generation. Wind and solar facilities reflect name plate capacity measured in alternating current.

(b)Represents DTE Electric's 81% interest in Belle River with a total capability of 1,270 MW. See Note 7 to the Consolidated Financial Statements, "Jointly-Owned Utility Plant."

(c)The Monroe generating plant provided 39% of DTE Electric’s total 2021 power plant generation.

(d)Represents DTE Electric’s 49% interest in Ludington with a total capability of 2,220 MW. See Note 7 to the Consolidated Financial Statements, "Jointly-Owned Utility Plant."

(e)In addition to the owned renewable facilities described above, DTE Electric has long-term contracts for 481 MW of renewable power generated from wind, solar, and biomass facilities. Of the 481 MW, currently 52 MW relate to power purchase agreements with DTE Sustainable Generation.

See "Capital Investments" in Management's Discussion and Analysis in Item 7 of this Report for information regarding plant retirements and future capital expenditures.

DTE Electric owns and operates ~~696~~698 distribution substations with a capacity of approximately ~~36,661,000~~36,987,000 kilovolt-amperes (kVA) and approximately ~~442,700~~449,800 line transformers with a capacity of approximately ~~32,059,000~~32,817,000 kVA.

Circuit miles of electric distribution lines owned and in service as of December 31, ~~2018~~2021 are shown in the following table:


	Circuit Miles			Circuit Miles
Operating Voltage-Kilovolts (kV)	Overhead	Underground	Operating Voltage-Kilovolts (kV)	Overhead	Underground
4.8 kV to 13.2 kV	28,498	15,252	4.8 kV to 13.2 kV	28,536	15,652
24 kV	182	686	24 kV	179	741
40 kV	2,306	376	40 kV	2,352	430
120 kV	61	8	120 kV	62	8
	31,047	16,322		31,129	16,831

There are numerous interconnections that allow the interchange of electricity between DTE Electric and electricity providers external to the DTE Electric service area. These interconnections are generally owned and operated by ITC Transmission, an unrelated company, and connect to neighboring energy companies.

Regulation

DTE Electric is subject to the regulatory jurisdiction of various agencies, including, but not limited to, the MPSC, the FERC, and the NRC. The MPSC issues orders pertaining to rates, recovery of certain costs, including the costs of generating facilities and regulatory assets, conditions of service, accounting, and operating-related matters. DTE Electric's MPSC-approved rates charged to customers have historically been designed to allow for the recovery of costs, plus an authorized rate of return on investments. The FERC regulates DTE Electric with respect to financing authorization, ~~and~~ wholesale electric ~~activities.~~market activities, certain affiliate transactions, the acquisition and disposition of certain generation and other facilities, and, in conjunction with the NERC, compliance with mandatory reliability standards. The NRC has regulatory jurisdiction over all phases of the operation, construction, licensing, and decommissioning of DTE Electric's nuclear plant operations. DTE Electric is subject to the requirements of other regulatory agencies with respect to safety, the environment, and health.

See Notes 8, 9, 12, 18, and 1819 to the Consolidated Financial Statements, ~~in Item 8 of this Report,~~ "Asset Retirement Obligations," "Regulatory Matters," "Fair Value," ~~and~~ "Commitments and ~~Contingencies.~~Contingencies," and " Nuclear Operations."

Energy Assistance Programs

Energy assistance programs, funded by the federal government and the State of Michigan, remain critical to DTE Electric’s ability to control its uncollectible accounts receivable and collections expenses. DTE Electric’s uncollectible accounts receivable expense is directly affected by the level of government-funded assistance that qualifying customers receive. DTE Electric works continuously with the State of Michigan and others to determine whether the share of funding allocated to customers is representative of the number of low-income individuals in the service territory. DTE Electric also partners with federal, state, and local officials to attempt to increase the share of low-income funding allocated to customers.

Strategy and Competition

DTE Electric's electrical generation operations seek to provide the energy needs of customers in a ~~cost effective manner. With~~cost-effective manner and support DTE Energy's goal to reduce carbon emissions by 32% by 2023, 50% by 2028, and 80% by 2040 from 2005 carbon emissions levels, as well as net zero emissions by 2050. An increasing amount of high wind and other extreme weather events driven by climate change, coupled with increasing electric vehicle adoption, will drive a continued need for substantial grid investment over the long-term. In addition, with potential capacity constraints in the MISO region, there will be increased dependency on DTE Electric's generation to provide reliable service and price stability for customers. ~~This generation will require continuing investments~~To maintain reliability and meet the carbon reduction goals in the near-term, DTE ~~Electric's primary coal generating units,~~Electric plans to put in service a natural gas fueled combined cycle generation facility in 2022 and ~~renewables.~~will continue its energy waste reduction initiatives and transition away from coal-fired plants to renewable energy and other sources. To achieve long-term carbon reduction goals, DTE Electric is monitoring the viability of emerging technologies involving energy storage, carbon capture and sequestration, alternative fuels such as hydrogen, and advanced nuclear power.

DTE Electric's distribution operations focus is on distributing energy in a safe, cost effective, and reliable manner to customers. DTE Electric seeks to increase operational efficiencies to increase customer satisfaction at an affordable rate.

The electric retail access program in Michigan gives electric customers the option of retail access to alternative electric suppliers, subject to limits. Customers with retail access to alternative electric suppliers represented approximately 10% of retail sales in 2018, 2017, and 2016 and consisted primarily of industrial and commercial customers. MPSC rate orders and 2008 energyEnergy legislation enacted by the State of Michigan ~~have~~has placed a 10% cap on ~~the~~ total retail ~~access related migration, mitigating~~access. This cap mitigates some of the unfavorable effects of electric retail access on DTE Electric's financial performance and ~~full service~~full-service customer rates. ~~Energy legislation passed in 2016 retained the 10%~~Customers with retail access ~~cap with some revisions.~~to alternative electric suppliers consist primarily of industrial and commercial customers and represented approximately 10%, 8.5%, and 10% of retail sales in 2021, 2020, and 2019, respectively. DTE Electric expects that customers with retail access to alternative electric suppliers will represent approximately 10% of retail sales in ~~2019.~~2022.

Competition in the regulated electric distribution business is primarily from the on-site generation of industrial customers and from distributed generation applications by industrial and commercial customers. DTE Electric does not expect significant competition for distribution to any group of customers in the near term.

Revenues from year to year will vary due to weather conditions, economic factors, regulatory events, and other risk factors as discussed in the "Risk Factors" in Item 1A. of this Report.

GAS

Description

DTE Energy's Gas segment consists principally of DTE Gas, a natural gas utility engaged in the purchase, storage, transportation, distribution, and sale of natural gas to approximately 1.3 million residential, commercial, and industrial customers throughout Michigan, and the sale of storage and transportation capacity.

DTE Gas' natural gas sales, end-user transportation, and intermediate transportation volumes, revenues, and Net Income are impacted by weather. Given the seasonal nature of the business, revenues and Net Income are concentrated in the first and fourth quarters of the calendar year. By the end of the first quarter, the heating season is largely over, and DTE Gas typically realizes substantially reduced revenues and earnings in the second quarter, and losses in the third quarter. The impacts of changes in annual average customer usage are minimized by the ~~RDM.~~Revenue Decoupling Mechanism authorized by the MPSC.

DTE Gas operations are not dependent upon a limited number of customers, and the loss of any one or a few customers would not have a material adverse effect on the results of DTE Gas.

~~See~~For a summary of Gas segment operating revenues by service, see Note 45 to the Consolidated Financial Statements, ~~in Item 8 of the Report,~~ "Revenue."

Natural Gas Supply

DTE Gas' gas distribution system has a planned maximum daily send-out capacity of 2.4 Bcf, with approximately 66% of the volume coming from underground storage for ~~2018.~~2021. Peak-use requirements are met through utilization of storage facilities, pipeline transportation capacity, and purchased gas supplies. Because of the geographic diversity of supply and its pipeline transportation and storage capacity, DTE Gas is able to reliably meet supply requirements. DTE Gas believes natural gas supply and pipeline capacity will be sufficiently available to meet market demands in the foreseeable future.

DTE Gas purchases natural gas supplies in the open market by contracting with producers and marketers and maintains a diversified portfolio of natural gas supply contracts. Supplier, producing region, quantity, and available transportation diversify DTE Gas' natural gas supply base. Natural gas supply is obtained from various sources in different geographic areas (Appalachian, Gulf Coast, Mid-Continent, Canada, and Michigan) under agreements that vary in both pricing and terms. Gas supply pricing is generally tied to the New York Mercantile Exchange and published price indices to approximate current market prices combined with MPSC-approved fixed price supplies with varying terms and volumes through ~~2021.~~2024.

DTE Gas is directly connected to interstate pipelines, providing access to most of the major natural gas supply producing regions in the Appalachian, Gulf Coast, Mid-Continent, and Canadian regions. The primary long-term transportation supply contracts at December 31, ~~2018~~2021 are listed below.


				Availability (MDth/d)	Contract Expiration
	Availability (MDth/d)	Contract Expiration
Vector Pipeline L.P.			Vector Pipeline L.P.	20	2022
Great Lakes Gas Transmission L.P.	30	2022	Great Lakes Gas Transmission L.P.	30	2024
Viking Gas Transmission Company	21	2022	Viking Gas Transmission Company	21	2027
Vector Pipeline L.P. (an affiliate)	20	2022
ANR Pipeline Company	129	2028	ANR Pipeline Company	129	2028
Panhandle Eastern Pipeline Company	125	2029	Panhandle Eastern Pipeline Company	125	2029
NEXUS Pipeline (an affiliate)	75	2033
NEXUS Pipeline			NEXUS Pipeline	75	2033

Properties

DTE Gas owns distribution, storage, and transportation properties that are located in the State of Michigan. The distribution system includes approximately ~~19,800~~20,000 miles of distribution mains, approximately ~~1,305,000~~1,304,000 service pipelines, and approximately ~~1,273,000~~1,305,000 active ~~meters, and~~meters. DTE Gas also owns approximately 2,000 miles of transmission pipelines that deliver natural gas to the distribution districts and interconnect DTE Gas storage fields with the sources of supply and the market areas.

DTE Gas owns storage properties relating to four underground natural gas storage fields with an aggregate working gas storage capacity of approximately 139 Bcf. These facilities are important in providing reliable and cost-effective service to DTE Gas customers. In addition, DTE Gas sells storage services to third parties.

Most of DTE Gas' distribution and transportation property is located on property owned by others and used by DTE Gas through easements, permits, or licenses. Substantially all of DTE Gas' property is subject to the lien of a mortgage.

DTE Gas leases a portion of its pipeline system ~~to the Vector Pipeline Partnership (an affiliate)~~ through a ~~capital~~finance lease arrangement. See Note 17 to the Consolidated Financial Statements, ~~in Item 8 of the Report, "Capital and Operating Leases.~~"Leases."

Regulation

DTE Gas is subject to the regulatory jurisdiction of the MPSC, which issues orders pertaining to rates, recovery of certain costs, including the costs of regulatory assets, conditions of service, accounting, and operating-related matters. DTE Gas' MPSC-approved rates charged to customers have historically been designed to allow for the recovery of costs, plus an authorized rate of return on investments. DTE Gas operates natural gas storage and transportation facilities in Michigan as intrastate facilities regulated by the MPSC and provides intrastate storage and transportation services pursuant to a MPSC-approved tariff.

DTE Gas also provides interstate storage and transportation services in accordance with an Operating Statement on file with the FERC. The FERC's jurisdiction is limited and extends to the rates, non-discriminatory requirements, and the terms and conditions applicable to storage and transportation provided by DTE Gas in interstate markets. FERC granted DTE Gas authority to provide storage and related services in interstate commerce at market-based rates. DTE Gas provides transportation services in interstate commerce at cost-based rates approved by the MPSC and filed with the FERC.

DTE Gas is subject to the requirements of other regulatory agencies with respect to safety, the environment, and health.

See Notes 9 and 18 to the Consolidated Financial Statements, ~~in Item 8 of this Report,~~ "Regulatory Matters" and "Commitments and Contingencies."

Energy Assistance ~~Program~~Programs

Energy assistance programs, funded by the federal government and the State of Michigan, remain critical to DTE Gas' ability to control its uncollectible accounts receivable and collections expenses. DTE Gas' uncollectible accounts receivable expense is directly affected by the level of government-funded assistance its qualifying customers receive. DTE Gas works continuously with the State of Michigan and others to determine whether the share of funding allocated to customers is representative of the number of low-income individuals in the service territory. DTE Gas also partners with federal, state, and local officials to attempt to increase the share of low-income funding allocated to ~~DTE Gas~~ customers.

Strategy and Competition

DTE Gas' strategy is to ensure the safe, reliable, and cost effective delivery of natural gas service within its franchised markets in Michigan. In addition, DTE Gas is promoting the extension of its distribution system to underserved markets and the increased use of natural gas furnaces, water heaters, and appliances within its current customer base. DTE Gas continues to focus on the reduction of operating costs and the delivery of energy waste reduction products and services to its customers, making natural gas service the preferred fuel and even more affordable for its customers.

Competition in the gas business primarily involves other natural gas transportation providers, as well as providers of alternative fuels and energy sources. The primary focus of competition for end-user transportation is cost and reliability. Some large commercial and industrial customers have the ability to switch to alternative fuel sources such as coal, electricity, oil, and steam. If these customers were to choose an alternative fuel source, they would not have a need for DTE Gas' end-user transportation service. DTE Gas competes against alternative fuel sources by providing competitive pricing and reliable service, supported by its storage capacity.

Having an extensive transportation pipeline system has enabled marketing of DTE Gas' storage and transportation services to gas producers, marketers, distribution companies, end-user customers, and other pipeline companies. The business operates in a central geographic location with connections to major Midwestern interstate pipelines that extend throughout the Midwest, eastern United States, and eastern Canada.

DTE Gas' storage capacity is used to store natural gas for delivery to its customers and is also sold to third parties under a variety of arrangements. Prices for storage arrangements for shorter periods are generally higher, but more volatile, than for longer periods. Prices are influenced primarily by market conditions, weather, and natural gas pricing.

~~GAS STORAGE AND PIPELINES~~DTE Energy is also committed to a goal of net zero carbon emissions by 2050 for its gas utility, for both internal operations and from suppliers. To achieve net zero, DTE Gas is working to source gas with lower methane intensity, reduce emissions through its main renewal and pipeline integrity programs, and if necessary, use carbon offsets to address any remaining emissions. DTE Energy is also committed to helping DTE Gas customers reduce their emissions by 35% by 2050 by increasing energy efficiency, pursuing advanced technologies such as hydrogen, and through the CleanVision Natural Gas Balance program which provides customers the option to use carbon offsets and renewable natural gas.

DTE VANTAGE

Description

Gas Storage and Pipelines owns natural gas storage fields, lateral and gathering pipeline systems, compression and surface facilities, and has ownership interests in interstate pipelines serving the Midwest, Ontario, and Northeast markets. The pipeline and storage assets are primarily supported by long-term, fixed-price revenue contracts.

~~Properties~~

~~Gas Storage and Pipelines holds the following properties:~~



~~Property Classification~~	~~% Owned~~	~~Description~~	~~Location~~
~~Pipelines~~
~~Appalachia Gathering System~~	~~100%~~	~~116-mile pipeline delivering Marcellus Shale gas to Texas Eastern Pipeline and Stonewall Gas Gathering system~~	~~PA and WV~~
~~Birdsboro Pipeline~~	~~100%~~	~~14-mile pipeline delivering gas supply to the Birdsboro Power Plant~~	PA
~~Bluestone Pipeline~~	~~100%~~	~~64-mile pipeline delivering Marcellus Shale gas to Millennium Pipeline and Tennessee Pipeline~~	~~PA and NY~~
~~Michigan gathering systems~~	~~100%~~	~~590-mile pipeline system in northern Michigan~~	MI
~~Millennium Pipeline~~	~~26%~~	~~269-mile pipeline serving markets in the Northeast~~	NY
~~NEXUS Pipeline~~	~~50%~~	~~256-mile pipeline to transport Utica and Marcellus shale gas to Ohio, Michigan, and Ontario market centers~~	~~OH and MI~~
~~Stonewall Gas Gathering~~	~~55%~~	~~68-mile pipeline connecting Appalachia Gathering System to Columbia Pipeline~~	WV
~~Susquehanna gathering system~~	~~100%~~	~~203-mile pipeline delivering Southwestern Energy's Marcellus Shale gas production to Bluestone Pipeline~~	PA
~~Tioga Gas Gathering~~	~~100%~~	~~3-mile pipeline delivering production gas to Dominion Transmission interconnect~~	PA
~~Vector Pipeline~~	~~40%~~	~~348-mile pipeline connecting Chicago, Michigan, and Ontario market centers~~	~~IL, IN, MI, and Ontario~~
~~Storage~~
~~Washington 10~~	~~100%~~	~~75 Bcf of storage capacity~~	MI
~~Washington 28~~	~~50%~~	~~16 Bcf of storage capacity~~	MI

~~The assets of these businesses are well integrated with other~~ DTE Energy operations. Pursuant to an operating agreement, DTE Gas provides physical operations, maintenance, and technical support for the Washington 10 and 28 storage facilities and for the Michigan gathering systems.

~~Regulation~~

Gas Storage and Pipelines operates natural gas storage facilities in Michigan as intrastate facilities regulated by the MPSC, and provides intrastate storage and related services pursuant to an MPSC-approved tariff. Gas Storage and Pipelines also provides interstate services in accordance with an Operating Statement on file with the FERC. Vector, Millennium, Birdsboro, and NEXUS Pipelines provide interstate transportation services in accordance with their FERC-approved tariffs. In addition, NEXUS and Vector are subject to applicable laws, rules, and regulations in Canada. Gas Storage and Pipelines' gathering and pipeline assets are subject to the rules and regulations of various state utility commissions.

~~Strategy and Competition~~

Gas Storage and Pipelines expects to continue its steady growth plan by expanding existing assets, acquiring and/or developing new assets that are typically supported with long-term customer commitments. The focus will be on opportunities in the Midwest to Northeast region to supply natural gas to meet growing demand and displace less attractive supply from certain regions in North America. Much of the growth in demand for natural gas is expected to occur in the eastern Canada and the northeast U.S. regions. Gas Storage and Pipelines believes that the Vector, Millennium, and NEXUS Pipelines are well positioned to provide access routes and low-cost expansion options to these markets due to growth in production from the Marcellus/Utica Shales in Pennsylvania and West Virginia. Gas Storage and Pipelines has agreements with key producers that support its Bluestone Pipeline, Susquehanna gathering, Tioga gathering, AGS, and SGG businesses. Gas Storage and Pipelines is evaluating new pipeline and storage investment opportunities that could include additional pipeline and gathering expansions, laterals, compression, and other Marcellus/Utica shale midstream development or partnering opportunities.

Gas Storage and Pipelines has competition from other pipelines and storage providers. Operations are dependent upon a limited number of customers, and the loss of any one or a few customers could have a material adverse effect on the results of Gas Storage and Pipelines.

~~POWER AND INDUSTRIAL PROJECTS~~

~~Description~~

~~Power and Industrial Projects~~Vantage is comprised primarily of projects that deliver energy and utility-type products and services to industrial, commercial, and institutional customers, produce reduced emissions fuel, and sell electricity and gas from renewable energy projects. This business segment provides services using project assets usually located on or near the customers' premises in the steel, automotive, pulp and paper, airport, chemical, and other industries as follows:

Renewable Energy

•Renewable Gas Recovery — DTE Vantage has ownership interests in, and operates, twenty-two gas recovery sites in eight states. The sites recover methane from landfills and agricultural businesses and convert the gas to generate electricity and replace fossil fuels in industrial and manufacturing operations. Certain sites also refine the methane to produce pipeline-quality gas, which can then be used as vehicle fuel and generate environmental attributes.

•Wholesale Power and Renewables — DTE Vantage holds ownership interests in, and operates, four renewable generating plants with a capacity of 139 MWs. The electric output is sold under long-term power purchase agreements.

Industrial Energy Services

•On-Site Energy — DTE Vantage provides power generation, steam production, chilled water production, wastewater treatment, and compressed air supply to industrial customers. DTE Vantage also provides utility-type services using project assets usually located on or near the customers' premises in the automotive, airport, chemical, and other industries.

•Steel and Petroleum Coke — ~~Power and Industrial Projects~~DTE Vantage produces metallurgical coke from a coke battery with a capacity of 1.0 million tons per year and has an investment in a second coke battery with a capacity of 1.2 million tons per year. ~~Power~~DTE Vantage also provided pulverized coal through the end of 2021 and ~~Industrial Projects also provides pulverized coal~~continues to supply metallurgical and petroleum coke to the steel, pulp and paper, and other industries.

The EPA has implemented regulatory actions under the Clean Air Act to address emissions of GHGs from the utility sector and other sectors of the economy. Among these actions, in 2015 the EPA finalized performance standards for emissions of carbon dioxide from new and existing EGUs. In February 2016, the U.S. Supreme Court granted petitioners' requests for a stay of the carbon rules for existing EGUs (also known as the EPA Clean Power Plan) pending final review by the courts. The Clean Power Plan has no legal effect while the stay is in place. On March 28, 2017, a presidential executive order was issued on "Promoting Energy Independence and Economic Growth." The order instructs the EPA to review, and if appropriate, suspend, revise or rescind the Clean Power Plan rule. Following the issuance of this order, the federal government requested the U.S. Court of Appeals for the D.C. Circuit to hold all legal challenges in abeyance until the review of these regulations is completed. On October 10, 2017, the EPA proposed to rescind the Clean Power Plan and announced its intent to issue an ANPR seeking input as to whether it should replace the rule and, if so, what form it should take. In August 2018, the EPA proposed revised emission guidelines for GHGs from existing electric utility generating units. The proposed rule, named the Affordable Clean Energy (ACE) rule, is intended to replace the Clean Power Plan rule. Comments on the proposed ACE rule were due on October 31, 2018. It is not possible to determine the potential impact of the EPA's proposed ACE rule on existing sources at this time.

Pending or future legislation or other regulatory actions could have a material impact on DTE Electric's operations and financial position and the rates charged to its customers. Impacts include expenditures for environmental equipment beyond what is currently planned, financing costs related to additional capital expenditures, the purchase of emission credits from market sources, higher costs of purchased power, and the retirement of facilities where control equipment is not economical. DTE Electric would seek to recover these incremental costs through increased rates charged to its utility customers, as authorized by the MPSC.

Increased costs for energy produced from traditional coal-based sources due to recent, pending, and future regulatory initiatives could also increase the economic viability of energy produced from renewable, natural gas fueled generation, and/or nuclear sources, energy waste reduction initiatives, and the potential development of market-based trading of carbon instruments which could provide new business opportunities for DTE Energy's utility and non-utility segments. At the present time, it is not possible to quantify the financial impacts of these climate related regulatory initiatives on the Registrants or their customers.

See Items 1. and 2. Business and Properties and Note 18 to the Consolidated Financial Statements, ~~in Item 8 of this Report,~~ "Commitments and Contingencies," for further discussion of Environmental Matters.

~~OUTLOOK~~ENERGY TRADING

Description

Energy Trading focuses on physical and financial power, natural gas and environmental marketing and trading, structured transactions, enhancement of returns from its asset portfolio, and optimization of contracted natural gas pipeline transportation and storage positions. Energy Trading also provides natural gas, power, environmental and related services which may include the management of associated storage and transportation contracts on the customers’ behalf and the supply or purchase of environmental attributes to various customers. Energy Trading's customer base is predominantly utilities, local distribution companies, pipelines, producers and generators, and other marketing and trading companies. Energy Trading also provides commodity risk management services to the other businesses within DTE Energy.

Energy Trading enters into derivative financial instruments as part of its marketing and hedging activities. These financial instruments are generally accounted for under the MTM method, which results in the recognition in earnings of unrealized gains and losses from changes in the fair value of the derivatives. Energy Trading utilizes forwards, futures, swaps, and option contracts to mitigate risk associated with marketing and trading activity, as well as for proprietary trading within defined risk guidelines.

Significant portions of the Energy Trading portfolio are economically hedged. Most financial instruments, physical power and natural gas contracts, and certain environmental contracts are deemed derivatives; whereas, natural gas and environmental inventory, contracts for pipeline transportation, storage assets, and some environmental contracts are not derivatives. As a result, this segment will experience earnings volatility as derivatives are marked-to-market without revaluing the underlying non-derivative contracts and assets. The business’ strategy is to economically manage the price risk of these underlying non-derivative contracts and assets with futures, forwards, swaps, and options. This results in gains and losses that are recognized in different interim and annual accounting periods.

Regulation

Energy Trading has market-based rate authority from the FERC to sell power and blanket authority from the FERC to sell natural gas at market prices. Energy Trading is subject to FERC reporting requirements and market behavior rules. Energy Trading is also subject to the applicable laws, rules, and regulations related to the CFTC, U.S. Department of Homeland Security, and DOE. In addition, Energy Trading is subject to applicable laws, rules, and regulations in Canada.

Strategy and Competition

DTE Energy's strategy for the Energy Trading business is to deliver value-added services to DTE Energy customers. DTE Energy seeks to manage this business in a manner complementary to the growth of DTE Energy's other business segments. Energy Trading focuses on physical marketing and the optimization of its portfolio of energy assets. The segment competes with electric and gas marketers, financial institutions, traders, utilities, and other energy providers. The Energy Trading business is dependent upon the availability of capital and an investment grade credit rating. DTE Energy believes it has ample available capital capacity to support Energy Trading activities. DTE Energy monitors its use of capital closely to ensure that its commitments do not exceed capacity. A material credit restriction would negatively impact Energy Trading's financial performance. Competitors with greater access to capital, or at a lower cost, may have a competitive advantage. DTE Energy has risk management and credit processes to monitor and mitigate risk.

CORPORATE AND OTHER

Corporate and Other includes various holding company activities, holds certain non-utility debt, and holds certain investments, including funds supporting regional development and economic growth.

ENVIRONMENTAL MATTERS

The Registrants are subject to extensive environmental regulation and expect to continue recovering environmental costs related to utility operations through rates charged to customers. The following table summarizes DTE Energy's, including DTE Electric's, estimated significant future environmental expenditures based upon current regulations. Pending or future reconsideration of current regulations may impact the estimated expenditures summarized in the table below. Actual costs to comply could vary substantially. Additional costs may result as the effects of various substances on the environment are studied and governmental regulations are developed and implemented.


	DTE Electric		DTE Gas		Total
	(In millions)

Water	$	10	$	—	$	10
Contaminated and other sites	12		14		26
Coal combustion residuals and effluent limitations guidelines	417		—		417
Estimated total future expenditures through 2026	$	439	$	14	$	453
Estimated 2022 expenditures	$	81	$	8	$	89
Estimated 2023 expenditures	$	65	$	3	$	68

For additional information regarding environmental matters, refer to Notes 8, 9, and 18 to the Consolidated Financial Statements, "Asset Retirement Obligations," "Regulatory Matters," and "Commitments and Contingencies."

HUMAN CAPITAL MANAGEMENT

DTE Energy and its subsidiaries had approximately 10,300 employees as of December 31, 2021, of which approximately 5,200 were represented by unions. DTE Electric had approximately 4,700 employees as of December 31, 2021, of which approximately 2,700 were represented by unions. The workforce is comprised almost entirely of full-time employees.

DTE Energy and utilities across the country are managing the turnover of our workforce due to a significant number of retirements expected in the next ~~few~~ten years - a period that will be impacted by major transformation of our business through technology investments, changes to our electric generation portfolio, and upgrades to our distribution infrastructure.

Amidst this challenge, DTE Energy is building a ~~period~~culture of ~~rapid~~highly engaged employees with skills and expertise in science, technology, engineering, math, analytics, and skilled trades, which are in high demand and critical to our industry. To attract and retain the best talent, DTE Energy promotes the engagement of its employees through diversity, equity, and inclusion; health, safety, and well-being; and compensation and benefits.

DTE Energy also provides continuous learning to optimize employee performance and engagement. DTE Energy provides tuition reimbursement and an internal learning platform that includes free instructor-led and online courses, learning-focused events with expert guest speakers, and a comprehensive development program for new front-line leaders. DTE Energy also has a Talent Planning Committee that oversees talent and succession planning. These efforts have been critical in supporting employees transitioning to new roles as coal-fired plants are retired and replaced with new, cleaner generation.

Diversity, Equity, and Inclusion (DEI)

DTE Energy is committed to building a diverse, empowered, and engaged team that delivers safe, reliable service and energy to our customers. A diverse workforce and inclusive culture contribute to DTE Energy's success and sustainability by driving innovation and creating trusted relationships with employees, customers, suppliers, and community partners. By tapping into the talent, unique perspectives, and cultural and life experiences of every employee, DTE Energy can ensure its continued success.

As of December 31, 2021, DTE Energy’s workforce was comprised of 28% women and 29% minorities. DTE Energy measures DEI performance by its workforce representation of women, minorities, veterans, and employees with disabilities, as well as the following:

•Diversity of candidates, hires, high potential talent, and leadership promotions

•Employee engagement, including specific elements that measure a culture of inclusion

•Number of DEI related communications and events

•Supplier diversity spend

•Rankings and scores from DEI benchmarking surveys

•Formal training programs, including unconscious bias training for employees and leaders

Health, Safety, and Well-being

The health, safety, and well-being of people is DTE Energy's top priority - for employees, contractors, customers, and everyone in the communities that DTE Energy serves. DTE Energy's health, safety, and well-being culture is maintained and strengthened with the help of multiple safety and well-being committees spanning all levels of the company. Members include union representatives, DTE Energy executives, office workers, and field employees.

Safety

All workplace injuries and incidents that could have caused an injury are documented and thoroughly reviewed for potential preventive measures. DTE Energy directs its employees to be responsible for their own safety and the safety of everyone around them. DTE Energy also administers regular safety training. Hazardous work is identified and categorized according to risk and training is provided to mitigate risk of any serious injuries.

DTE Energy monitors its safety performance by reviewing the rate of safety incidents, as defined by the Office of Safety and Health Administration ("OSHA rate"), and the rate of Days Away, Restricted, or Transferred ("DART").

COVID-19 Response

During the first quarter 2020, the COVID-19 pandemic began impacting Michigan and the other service territories throughout the United States in which DTE Energy operates. DTE Energy took quick action to ensure the safety and well-being of its employees. DTE Energy successfully implemented work from home for over half of its employees and extensive new safety procedures to ensure plant and employee safety, including the use of personal protective equipment, contact tracing, and cleaning of facilities. To further support employees during the pandemic, DTE Energy enhanced communications around its employee assistance programs, established an occupational health call center, and provided clinical case management for cases related to COVID-19.

DTE Energy continues to actively monitor risks related to COVID-19 and proper application of our safety protocols. DTE Energy is also committed to providing consistent, transparent communication to employees around safe practices, quarantine, monitoring and testing protocols, vaccine availability, and plans for safely returning to office work.

Culture of Health and Well-being

DTE Energy aspires to become the healthiest and most supportive organization of well-being. DTE Energy is focused on supporting employees holistically, including physical health, emotional well-being, social connectivity, and financial security. Resources are provided to promote and support healthier lifestyles, including an on-site clinic, fitness centers, on-site and virtual well-being classes, and a team of well-being coordinators, registered dieticians and athletic trainers. DTE Energy offers a Healthy Living Program to complete both an annual physical with biometric screenings and a Health Risk Assessment to ensure employees have a relationship with a trusted physician and early detection of health conditions. Additionally, DTE Energy offers extensive well-being education and disease management programs.

DTE Energy monitors health and well-being performance across various metrics including an Employer Health Opportunity Assessment, completion of required well-being trainings, and measurement of collective health of the DTE family including medical trends and spend.

Compensation and Benefits

DTE Energy is committed to offering compensation that is competitive, market driven, and internally equitable. Approximately half of DTE Energy's employees are represented by labor unions through which pay is uniformly determined through collectively bargained agreements. For non-represented employees, DTE Energy's human resources professionals establish pay ranges for each job classification and work with hiring leaders to make competitive offers within the range to candidates based on objective factors like years of experience and strength of skills relevant to the job. Annually, DTE Energy conducts a review of compensation practices as part of its affirmative action program and makes adjustments as needed to ensure that pay is fair and equitable.

DTE Energy provides competitive, customizable benefits for all regular full-time and regular part-time employees. Innovative compensation and benefits initiatives at DTE Energy include:

•A 401(k) plan/Employee Stock Ownership Plan that is available to all regular full-time and regular part-time employees, including automatic enrollment of new hires, automatic annual escalation of employee 401(k) contributions up to 10% of pay, and 401(k) matching contributions

•Competitive health and welfare benefits

•Child bonding/parental leave of absence

•Additional vacation days available for employee purchase

•Competitive incentive plans, which are offered to all non-represented employees to create alignment of corporate and individual goals

Incentive Plans

DTE Energy has two primary types of incentives that reward individuals for performance. The incentives are designed to tie compensation to performance and encourage individuals to align their interests with those of the shareholders and customers of the Company.

•Annual incentive plans allow DTE Energy to reward individuals with annual cash bonuses for performance against pre-established objectives based on work performed in the prior year. Objectives are aligned with our core priorities and include metrics for employee engagement and safety, customer satisfaction, utility operating excellence, and financial metrics such as earnings per share and cash flows.

•Long-term incentive plans allow DTE Energy to grant individuals long-term equity incentives to encourage continued employment with DTE Energy, to accomplish pre-defined long-term performance objectives, and to create shareholder alignment. Metrics generally include total shareholder return relative to industry peers, utility return on equity, and balance sheet health.

For additional information on the metrics above, please see the "Annual and Long-term Incentives" section of DTE Energy's Proxy Statement.

Additionally, refer to DTE Energy’s 2021 Environmental, Social, Governance and Sustainability report for further information on metrics tracked for DEI, health and safety, and other components of DTE Energy’s human capital management, as well as the annual Culture of Health and Well-being report. These reports are available through the Environmental, Social, and Governance section of the Investor Relations page on DTE Energy’s website (www.dteenergy.com), and shall not be deemed incorporated by reference into this Form 10-K.

Item 1A. Risk Factors

There are various risks associated with the operations of the Registrants' utility businesses and DTE Energy's non-utility businesses. To provide a framework to understand the operating environment of the Registrants, below is a brief explanation of the more significant risks associated with their businesses. Although the Registrants have tried to identify and discuss key risk factors, others could emerge in the future. Each of the following risks could affect performance.

Regulatory, Legislative, and Legal Risks

The Registrants are subject to rate regulation. Electric and gas rates for the utilities are set by the MPSC and the FERC and cannot be changed without regulatory authorization. The Registrants may be negatively impacted by new regulations or interpretations by the MPSC, the FERC, or other regulatory bodies. The Registrants' ability to recover costs may be impacted by the time lag between the incurring of costs and the recovery of the costs in customers' rates. Regulators also may decide to disallow recovery of certain costs in customers' rates if they determine that those costs do not meet the standards for recovery under current governing laws and regulations. Regulators may also disagree with the Registrants' rate calculations under the various mechanisms that are intended to mitigate the risk to their utilities related to certain aspects of the business. If the Registrants cannot agree with regulators on an appropriate reconciliation of those mechanisms, it may impact the Registrants' ability to recover certain costs through customer rates. Regulators may also decide to eliminate these mechanisms in future rate cases, which may make it more difficult for the Registrants to recover their costs in the rates charged to customers. The Registrants cannot predict what rates the MPSC will authorize in future rate cases. New legislation, regulations, or interpretations could change how the business operates, impact the Registrants' ability to recover costs through rates or the timing of such recovery, or require the Registrants to incur additional expenses.

Changes to Michigan's electric retail access program could negatively impact the Registrants' financial performance. The State of Michigan currently experiences a hybrid market, where the MPSC continues to regulate electric rates for DTE Electric customers, while alternative electric suppliers charge market-based rates. MPSC rate orders, and energy legislation enacted by the State of Michigan, have placed a 10% cap on the total potential retail access migration. However, even with the legislated 10% cap on participation, there continues to be legislative and financial risk associated with the electric retail access program. Electric retail access migration is sensitive to market price and full service electric price changes. The Registrants are required under current regulation to provide full service to retail access customers that choose to return, potentially resulting in the need for additional generating capacity.

Environmental laws and liability may be costly. The Registrants are subject to, and affected by, numerous environmental regulations. These regulations govern air emissions, water quality, wastewater discharge, and disposal of solid and hazardous waste. Compliance with these regulations can significantly increase capital spending, operating expenses, and plant down times, and can negatively affect the affordability of the rates charged to customers.

Uncertainty around future environmental regulations creates difficulty planning long-term capital projects in the Registrants' generation fleet and, for DTE Energy's gas distribution businesses. These laws and regulations require the Registrants to seek a variety of environmental licenses, permits, inspections, and other regulatory approvals. The Registrants could be required to install expensive pollution control measures or limit or cease activities, including the retirement of certain generating plants, based on these regulations. Additionally, the Registrants may become a responsible party for environmental cleanup at sites identified by a regulatory body. The Registrants cannot predict with certainty the amount and timing of future expenditures related to environmental matters because of the difficulty of estimating cleanup costs. There is also uncertainty in quantifying liabilities under environmental laws that impose joint and several liability on potentially responsible parties.

The Registrants may also incur liabilities as a result of potential future requirements to address climate change issues. Proposals for voluntary initiatives and mandatory controls are being discussed both in the United States and worldwide to reduce GHGs such as carbon dioxide, a by-product of burning fossil fuels. If increased regulations of GHG emissions are implemented, or if existing deadlines for these regulations are accelerated, the operations of DTE Electric's fossil-fueled generation assets may be significantly impacted. Since there can be no assurances that environmental costs may be recovered through the regulatory process, the Registrants' financial performance may be negatively impacted as a result of environmental matters.

The Renewable Portfolio Standard and energy waste reduction may affect the Registrants' business and federal and state fuel standards may affect DTE Energy's non-utility investments. The Registrants are subject to existing Michigan, and potential future, federal legislation and regulation requiring them to secure sources of renewable energy. The Registrants have complied with the existing federal and state legislation, but do not know what requirements may be added by federal or state legislation in the future. In addition, the Registrants expect to comply with new Michigan legislation increasing the percentage of power required to be provided by renewable energy sources. The Registrants cannot predict the financial impact or costs associated with complying with potential future legislation and regulations. Compliance with these requirements can significantly increase capital expenditures and operating expenses and can negatively affect the affordability of the rates charged to customers.

In addition, the Registrants are also required by Michigan legislation to implement energy waste reduction measures and provide energy waste reduction customer awareness and education programs. These requirements necessitate expenditures, and implementation of these programs creates the risk of reducing the Registrants' revenues as customers decrease their energy usage. The Registrants cannot predict how these programs will impact their business and future operating results.

DTE Energy's non-utility renewable natural gas investments are also dependent on the federal Renewable Fuel Standard and California's Low Carbon Fuel Standard. Changes to these standards may affect DTE Energy's business and result in lower earnings.

DTE Energy's ability to utilize production tax credits may be limited. To reduce U.S. dependence on imported oil, the Internal Revenue Code provides production tax credits as an incentive for taxpayers to produce fuels and electricity from alternative sources. The Registrants generated production tax credits from renewable energy generation and DTE Energy generated production tax credits from renewable gas recovery, reduced emission fuel, and gas production operations. If the Registrants' production tax credits were disallowed in whole or in part as a result of an IRS audit or changes in tax law, there could be additional tax liabilities owed for previously recognized tax credits that could significantly impact the Registrants' earnings and cash flows.

Operational Risks

The Registrants' electric distribution system and DTE Energy's gas distribution system are subject to risks from their operation, which could reduce revenues, increase expenses, and have a material adverse effect on their business, financial position, and results of operations. The Registrants' electric distribution and DTE Energy’s gas distribution systems are subject to many operational risks. These operational systems and infrastructure have been in service for many years. Equipment, even when maintained in accordance with good utility practices, is subject to operational failure, including events that are beyond the Registrants' control, and could require significant operation and maintenance expense or capital expenditures to operate efficiently. Because the Registrants’ distribution systems are interconnected with those of third parties, the operation of the Registrants’ systems could be adversely affected by unexpected or uncontrollable events occurring on the systems of such third parties.

Construction and capital improvements to the Registrants' power facilities and DTE Energy's distribution systems subject them to risk. The Registrants are managing ongoing, and planning future, significant construction and capital improvement projects at the Registrants' multiple power generation and distribution facilities and at DTE Energy's gas distribution system. Many factors that could cause delays or increased prices for these complex projects are beyond the Registrants' control, including the cost of materials and labor, subcontractor performance, timing and issuance of necessary permits or approvals (including required certificates from regulatory agencies), construction disputes, impediments to acquiring rights-of-way or land rights on a timely basis and on acceptable terms, cost overruns, and weather conditions. Failure to complete these projects on schedule and on budget for any reason could adversely affect the Registrants' financial performance, operations, or expected investment returns at the affected facilities, businesses and development projects.

Operation of a nuclear facility subjects the Registrants to risk. Ownership of an operating nuclear generating plant subjects the Registrants to significant additional risks. These risks include, among others, plant security, environmental regulation and remediation, changes in federal nuclear regulation, increased capital expenditures to meet industry requirements, and operational factors that can significantly impact the performance and cost of operating a nuclear facility compared to other generation options. Insurance maintained by the Registrants for various nuclear-related risks may not be sufficient to cover the Registrants' costs in the event of an accident or business interruption at the nuclear generating plant, which may affect the Registrants' financial performance. In addition, the Registrants' nuclear decommissioning trust fund, to finance the decommissioning of the nuclear generating plant, may not be sufficient to fund the cost of decommissioning. A decline in market value of assets held in decommissioning trust funds due to poor investment performance or other factors may increase the funding requirements for these obligations. Any increase in funding requirements may have a material impact on the Registrants’ liquidity, financial position, or results of operations.

The supply and/or price of energy commodities and/or related services may impact the Registrants' financial results. The Registrants are dependent on coal for much of their electrical generating capacity as well as uranium for their nuclear operations. DTE Energy's access to natural gas supplies is critical to ensure reliability of service for utility gas customers. DTE Energy's non-utility businesses are also dependent upon supplies and prices of energy commodities and services. Price fluctuations, fuel supply disruptions, and changes in transportation costs, could have a negative impact on the amounts DTE Electric charges utility customers for electricity and DTE Gas charges utility customers for gas, and on the profitability of DTE Energy's non-utility businesses. The Registrants' hedging strategies and regulatory recovery mechanisms may be insufficient to mitigate the negative fluctuations in commodity supply prices at their utility or DTE Energy's non-utility businesses, and the Registrants' financial performance may therefore be negatively impacted by price fluctuations.

The price of energy also impacts the market for DTE Energy's non-utility businesses, particularly those that compete with utilities and alternative electric suppliers. The price of environmental attributes generated by DTE Energy's renewable natural gas investments, including those related to the federal Renewable Fuel Standard and California's Low Carbon Fuel Standard, may also impact the market and financial results for DTE Energy's non-utility businesses.

The supply and/or price of other industrial raw and finished inputs and/or related services may impact the Registrants' financial results. The Registrants are dependent on supplies of certain commodities, such as copper and limestone, among others, and industrial materials, and services in order to maintain day-to-day operations and maintenance of their facilities. Price fluctuations, or supply interruptions for these commodities and other items, could have a negative impact on the amounts charged to customers for the Registrants' utility products and, for DTE Energy, on the profitability of the non-utility businesses.

Weather, including extreme weather caused by climate change, significantly affects operations. At both utilities, deviations from normal hot and ~~for~~cold weather conditions affect the ~~energy industry.~~Registrants' earnings and cash flows. Mild temperatures can result in decreased utilization of the Registrants' assets, lowering income and cash flows. At DTE Electric, ice storms, floods, tornadoes, or high winds can damage the electric distribution system infrastructure and power generation facilities and require it to perform emergency repairs and incur material unplanned expenses. The expenses of storm restoration efforts may not be fully recoverable through the regulatory process. Prolonged and/or more frequent outages caused by extreme weather could also negatively impact DTE Energy's ~~strong utility base, combined with its integrated non-utility operations, position it well for long-term growth.~~

~~Looking forward,~~reputation and customer satisfaction or result in increased regulatory oversight, and related damages to customer assets could subject DTE Energy ~~will focus~~to litigation. DTE Gas can also experience higher than anticipated expenses from emergency repairs on its gas distribution infrastructure required as a result of weather-related issues.

Unplanned power plant outages may be costly. Unforeseen maintenance may be required to safely produce electricity or comply with environmental regulations. As a result of unforeseen maintenance, the Registrants may be required to make spot market purchases of electricity that exceed the costs of generation. The Registrants' financial performance may be negatively affected if unable to recover such increased costs.

A work interruption may adversely affect the Registrants. There are several ~~areas~~bargaining units for DTE Energy's approximately 5,200 and DTE Electric's approximately 2,700 represented employees. The majority of represented employees are under contracts that expire in 2027. A union choosing to strike would have an impact on the Registrants' businesses. The Registrants are ~~expected~~unable to ~~improve future performance:~~predict the effect a work stoppage would have on their costs of operations and financial performance.

DTE Energy may not achieve the net zero carbon emissions goals of its electric and gas ~~customer satisfaction;~~utilities. DTE Energy has announced the voluntary commitments of its electric and gas utilities to achieve net zero carbon emissions by 2050. Technology research and developments, innovations, and advancements are critical to DTE Energy's ability to achieve this commitment. Other factors that may impact DTE Energy's ability to achieve these net zero goals include our service territory size and capacity needs remaining in line with current expectations, the impacts on our business of future regulations or legislation, the price and availability of carbon offsets, adoption of alternative energy products by the public such as greater use of electric vehicles, greater standardization of emissions reporting, and our ability over time to transition our electric generating portfolio. DTE Energy's net zero goals require making assumptions that involve risks and uncertainties. Should one or more of these underlying assumptions prove incorrect, our actual results and ability to achieve net zero emissions by 2050 could differ materially from expectations. In addition, DTE Energy cannot predict the ultimate impact of achieving this objective, or the various implementation aspects on its reliability or its results of operations, financial condition, or liquidity.

Financial, Economic, and Market Risks

DTE Energy's non-utility businesses may not perform to its expectations. DTE Energy relies on non-utility businesses for a portion of earnings and will depend on the successful execution of new business development in its non-utilities to help achieve overall growth targets. DTE Energy also expects that the loss of earnings from ceasing the operations of its REF non-utility business will be offset by growth in renewable energy and industrial services projects over the long term; however, such opportunities may not materialize as anticipated. If DTE Energy's current and contemplated non-utility investments do not perform at expected levels, DTE Energy could experience diminished earnings and a corresponding decline in shareholder value.

Adverse changes in the Registrants' credit ratings may negatively affect them. Regional and national economic conditions, increased scrutiny of the energy industry and regulatory changes, as well as changes in the Registrants' economic performance, could result in credit agencies reexamining their credit ratings. While credit ratings reflect the opinions of the credit agencies issuing such ratings and may not necessarily reflect actual performance, a downgrade in the Registrants' credit ratings below investment grade could restrict or discontinue their ability to access capital markets and could result in an increase in their borrowing costs, a reduced level of capital expenditures, and could impact future earnings and cash flows. In addition, a reduction in the Registrants' credit ratings may require them to post collateral related to various physical or financially settled contracts for the purchase of energy-related commodities, products, and services, which could impact their liquidity.

Poor investment performance of pension and other postretirement benefit plan assets and other factors impacting benefit plan costs could unfavorably impact the Registrants' liquidity and results of operations. The Registrants' costs of providing non-contributory defined benefit pension plans and other postretirement benefit plans are dependent upon a number of factors, such as the rates of return on plan assets, the level of interest rates used to measure the required minimum funding levels of the plans, future government regulation, and the Registrants' required or voluntary contributions made to the plans. The performance of the debt and equity markets affects the value of assets that are held in trust to satisfy future obligations under the Registrants' plans. The Registrants have significant benefit obligations and hold significant assets in trust to satisfy these obligations. These assets are subject to market fluctuations and will yield uncertain returns, which may fall below the Registrants' projected return rates. A decline in the market value of the pension and other postretirement benefit plan assets will increase the funding needs under the pension and other postretirement benefit plans if the actual asset returns do not recover these declines in the foreseeable future. Additionally, the pension and other postretirement benefit plan liabilities are sensitive to changes in interest rates. If interest rates decrease, the liabilities increase, resulting in increasing benefit expense and funding needs. Also, if future increases in pension and other postretirement benefit costs as a result of reduced plan assets are not recoverable from the Registrants' utility customers, the results of operations and financial position of the Registrants could be negatively affected. Without sustained growth in the plan investments over time to increase the value of plan assets, the Registrants could be required to fund these plans with significant amounts of cash. Such cash funding obligations could have a material impact on the Registrants' cash flows, financial position, or results of operations.

The Registrants' ability to access capital markets is important. The Registrants' ability to access capital markets is important to operate their businesses and to fund capital investments. Turmoil in credit markets may constrain the Registrants' ability, as well as the ability of their subsidiaries, to issue new debt, including commercial paper, and refinance existing debt at reasonable interest rates. In addition, the level of borrowing by other energy companies and the market as a whole could limit the Registrants' access to capital markets. The Registrants' long-term revolving credit facilities do not expire until 2024 and 2025, but the Registrants regularly access capital markets to refinance existing debt or fund new projects at the Registrants' utilities and DTE Energy's non-utility businesses, and the Registrants cannot predict the pricing or demand for those future transactions.

Emerging technologies may have a material adverse effect on the Registrants. Advances in technology that produce power or reduce power consumption include cost-effective renewable energy technologies, distributed generation, energy waste reduction technologies, and energy storage devices. Such developments may impact the price of energy, may affect energy deliveries as customer-owned generation becomes more cost-effective, may require further improvements to our distribution systems to address changing load demands, and could make portions of our electric system power supply and/or distribution facilities obsolete prior to the end of their useful lives. Such technologies could also result in further declines in commodity prices or demand for delivered energy. Each of these factors could materially affect the Registrants’ results of operations, cash flows, or financial position.

DTE Energy's participation in energy trading markets subjects it to risk. Events in the energy trading industry have increased the level of scrutiny on the energy trading business and the energy industry as a whole. In certain situations, DTE Energy may be required to post collateral to support trading operations, which could be substantial. If access to liquidity to support trading activities is curtailed, DTE Energy could experience decreased earnings potential and cash flows. Energy trading activities take place in volatile markets and expose DTE Energy to risks related to commodity price movements, deviations in weather, and other related risks. DTE Energy's trading business routinely has speculative trading positions in the market, within strict policy guidelines DTE Energy sets, resulting from the management of DTE Energy's business portfolio. To the extent speculative trading positions exist, fluctuating commodity prices can improve or diminish DTE Energy's financial results and financial position. DTE Energy manages its exposure by establishing and enforcing strict risk limits and risk management procedures. During periods of extreme volatility, these risk limits and risk management procedures may not work as planned and cannot eliminate all risks associated with these activities.

Regional, national, and international economic conditions can have an unfavorable impact on the Registrants. The Registrants' utility and DTE Energy's non-utility businesses follow the economic cycles of the customers they serve and credit risk of counterparties they do business with. Should the financial conditions of some of DTE Energy's significant customers deteriorate as a result of regional, national or international economic conditions, reduced volumes of electricity and gas, and demand for energy services DTE Energy supplies, collections of accounts receivable, reductions in federal and state energy assistance funding, and potentially higher levels of lost gas or stolen gas and electricity could result in decreased earnings and cash flows.

If DTE Energy's goodwill or other intangible assets become impaired, it may be required to record a charge to earnings. DTE Energy annually reviews the carrying value of goodwill associated with acquisitions it has made for impairment. Goodwill and other intangible assets are also reviewed on a quarterly basis whenever events or circumstances indicate that the carrying value of these assets may not be recoverable. Factors that may be considered for purposes of this analysis include a decline in stock price and market capitalization, slower industry growth rates, or material changes with customers or contracts that could negatively impact future cash flows. DTE Energy cannot predict the timing, strength, or duration of such changes or any subsequent recovery. If the carrying value of any goodwill or other intangible assets are determined to be not recoverable, DTE Energy may take a non-cash impairment charge, which could materially impact DTE Energy's results of operations and financial position.

The Registrants may not be fully covered by insurance. The Registrants have a comprehensive insurance program in place to provide coverage for various types of risks, including catastrophic damage as a result of severe weather or other natural disasters, war, terrorism, cyber incidents, or a combination of other significant unforeseen events that could impact the Registrants' operations. Economic losses might not be covered in full by insurance, or the Registrants' insurers may be unable to meet contractual obligations.

Safety and Security Risks

The Registrants' businesses have safety risks. The Registrants' electric distribution system, ~~reliability;~~

~~new electric generation;~~

power plants, renewable energy equipment, and other facilities, and DTE Energy's gas distribution system, ~~renewal;~~gas infrastructure, and other facilities, could be involved in incidents that result in injury, death, or property loss to employees, customers, third parties, or the public. Although the Registrants have insurance coverage for many potential incidents, depending upon the nature and severity of any incident, they could experience financial loss, damage to their reputation, and negative consequences from regulatory agencies or other public authorities.

~~rate competitiveness~~Threats of cyber incidents, physical security, and ~~affordability;~~terrorism could affect the Registrants' business. Issues may threaten the Registrants such as cyber incidents, physical security, or terrorism that may disrupt the Registrants' operations, and could harm the Registrants' operating results.

Information security risks have increased in recent years as a result of the proliferation of new technologies and the increased sophistication and frequency of cyberattacks, and data security breaches. The Registrants' industry requires the continued operation of sophisticated information and control technology systems and network infrastructure. All of the Registrants' technology systems are vulnerable to disability or failures due to cyber incidents, physical security threats, acts of war or terrorism, and other causes, as well as loss of operational control of the Registrants' electric generation and distribution assets and, DTE Energy's gas distribution assets. The Registrants have experienced, and expect to continue to be subject to, cybersecurity threats and incidents. If the Registrants' information technology systems were to fail and they were unable to recover in a timely way, the Registrants may be unable to fulfill critical business functions, which could have a material adverse effect on the Registrants' business, operating results, and financial condition.

Suppliers, vendors, contractors, and information technology providers have access to systems that support the Registrants’ operations and maintain customer and employee data. A breach of these third-party systems could adversely affect the business as if it was a breach of our own system. Also, because the Registrants’ generation and distribution systems are part of an interconnected system, a disruption caused by a cyber incident at another utility, electric generator, system operator, or commodity supplier could also adversely affect the Registrants’ businesses, operating results, and financial condition.

In addition, the Registrants' generation plants and electrical distribution facilities may be targets of physical security threats or terrorist activities that could disrupt the Registrants' ability to produce or distribute some portion of their products. The Registrants have increased security as a result of past events and may be required by regulators or by the future threat environment to make investments in security that the Registrants cannot currently predict.

Failure to maintain the security of personally identifiable information could adversely affect the Registrants. In connection with the Registrants' businesses, they collect and retain personally identifiable information of their customers, shareholders, and employees. Customers, shareholders, and employees expect that the Registrants will adequately protect their personal information. The regulatory ~~stability~~environment surrounding information security and ~~investment recovery for~~privacy is increasingly demanding. A significant theft, loss, or fraudulent use of customer, shareholder, employee, or Registrant data by cybercrime or otherwise, could adversely impact the Registrants' reputation, and could result in significant costs, fines, and litigation.

General and Other Risks

The COVID-19 pandemic and resulting impact on business and economic conditions could negatively affect the Registrants' businesses and operations. The COVID-19 pandemic is currently impacting countries, communities, supply chains and markets. The continued spread of COVID-19 and efforts to contain the virus, such as quarantines, closures, or reduced operations of businesses, governmental agencies and other institutions, have resulted in disruptions in various public, commercial, and industrial activities and have caused employee absences which interfered with certain operation and maintenance of the Registrants' facilities. Travel bans and restrictions, quarantines, and shelter in place orders could also cause us to experience operational delays, delay the delivery of critical infrastructure and other supplies we source globally, or delay the connection of electric or gas service to new customers, and have reduced the use of electricity and gas ~~utilities;~~by certain customers in the commercial and industrial segments. Any of the foregoing circumstances could adversely affect customer demand or revenues, impact the ability of the Registrants' suppliers, vendors or contractors to perform, or cause other unpredictable events, which could adversely affect the Registrants' businesses, results of operations or financial condition. The continued spread of COVID-19 has also led to disruption and volatility in the financial markets, which could increase the Registrants' costs to fund capital requirements and impact the operating results of our energy trading operations. To the extent that the Registrants' access to the capital markets is adversely affected by COVID-19, the Registrants may need to consider alternative sources of funding for our operations and for working capital, any of which could increase the Registrants' cost of capital. The extent to which COVID-19 may continue to impact the Registrants' liquidity, financial condition, and results of operations will depend on future developments, which are highly uncertain and cannot be predicted, including new information concerning the severity of COVID-19 and its related variants, vaccine distribution and public acceptance, and other actions taken to contain it or treat its impact, and the extent to which normal economic and operating conditions can resume, among others. Our business continuity plans and insurance coverage may be insufficient to mitigate these adverse impacts to our business.

~~employee safety~~Failure to attract and ~~engagement;~~retain key executive officers and other skilled professional and technical employees could have an adverse effect on the Registrants’ operations. The Registrants' businesses are dependent on their ability to attract and retain skilled employees. Competition for skilled employees in some areas is high, and the inability to attract and retain these employees could adversely affect the Registrants' business and future operating results. In addition, the Registrants have an aging utility workforce, and the failure of a successful transfer of knowledge and expertise could negatively impact their operations.

~~cost structure optimization across~~

DTE Energy relies on cash flows from subsidiaries. DTE Energy is a holding company. Cash flows from the utility and non-utility subsidiaries are required to pay interest expenses and dividends on DTE Energy debt and securities. Should a major subsidiary not be able to pay dividends or transfer cash flows to DTE Energy, its ability to pay interest and dividends would be restricted.

The spin-off of DT Midstream (the "Spin-off") may not achieve its intended benefits and may present additional risk to DTE Energy. As a result of the Spin-off, DTE Energy faces new and unique risks, including having fewer assets, reduced financial resources and less diversification of revenue sources. The Spin-off may not achieve some or all ~~business segments;~~of its anticipated benefits and we face risks providing DT Midstream with transition services. Each of these factors may adversely impact DTE Energy's financial condition, results of operations, and cash flows.

~~cash, capital,~~In connection with the Spin-off, DTE received a legal opinion that the distribution of shares of DT Midstream to DTE Energy shareholders qualifies as tax-free under Section 355 of the U.S. Internal Revenue Code. However, if the IRS determined on audit that the distribution is taxable, both DTE Energy and ~~liquidity~~our shareholders could incur significant U.S. federal income tax liabilities.

Following the Spin-off, the management and directors of each of DTE Energy and DT Midstream own common stock in both companies, and Robert Skaggs, Jr., who is DT Midstream's Executive Chairman, also serves on DTE Energy's Board and may be required to ~~maintain~~recuse himself from deliberations relating to arrangements between DTE Energy and DT Midstream in the future. This ownership and directorship overlap could create, or ~~improve financial strength;~~appear to create, potential conflicts of interest when the management and directors of one company face decisions that could have different implications for themselves and the other company. Potential conflicts of interest may also arise out of commercial arrangements that DTE Energy and DT Midstream have or may enter into in the future.

~~investments that integrate assets~~

Item 1B. Unresolved Staff Comments

None.

Item 3. Legal Proceedings

For more information on legal proceedings and ~~leverage skills~~matters related to the Registrants, see Notes 9 and ~~expertise.~~18 to the Consolidated Financial Statements, "Regulatory Matters" and "Commitments and Contingencies," respectively.

For environmental proceedings in which the government is a party, the Registrants include disclosures if any sanctions of $1 million or greater are expected.

Item 4. Mine Safety Disclosures

Not applicable.

Part II

Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters, and Issuer Purchases of Equity Securities

DTE Energy ~~will continue~~common stock is listed under the ticker symbol "DTE" on the New York Stock Exchange, which is the principal market for such stock.

At December 31, 2021, there were 193,747,509 shares of DTE Energy common stock outstanding. These shares were held by a total of 45,230 shareholders of record.

All of the 138,632,324 issued and outstanding shares of DTE Electric common stock, par value $10 per share, are indirectly-owned by DTE Energy, and constitute 100% of the voting securities of DTE Electric. Therefore, no market exists for DTE Electric's common stock.

For information on DTE Energy dividend restrictions, see Note 16 to ~~pursue opportunities~~the Consolidated Financial Statements, "Short-Term Credit Arrangements and Borrowings."

All of DTE Energy's equity compensation plans that provide for the annual awarding of stock-based compensation have been approved by shareholders. For additional detail, see Note 21 to ~~grow~~the Consolidated Financial Statements, "Stock-Based Compensation."

See the following table for information as of December 31, 2021:


	Number of Securities to be Issued Upon Exercise of Outstanding Options	Weighted-Average Exercise Price of Outstanding Options		Number of Securities Remaining Available for Future Issuance Under Equity Compensation Plans
Plans approved by shareholders	—	$	—	4,221,599

UNREGISTERED SALES OF DTE ENERGY EQUITY SECURITIES AND USE OF PROCEEDS

Purchases of DTE Energy Equity Securities by the Issuer and Affiliated Purchasers

The following table provides information about DTE Energy's purchases of equity securities that are registered by DTE Energy pursuant to Section 12 of the Exchange Act of 1934 for the quarter ended December 31, 2021:


	Number of Shares Purchased(a)	Average Price Paid per Share(a)		Number of Shares Purchased as Part of Publicly Announced Plans or Programs	Average Price Paid per Share	Maximum Dollar Value that May Yet Be Purchased Under the Plans or Programs
10/01/2021 — 10/31/2021	1,028	$	108.95	—	—	—
11/01/2021 — 11/30/2021	2,653	$	105.32	—	—	—
12/01/2021 — 12/31/2021	505	$	115.23	—	—	—
Total	4,186			—

(a)Represents shares of DTE Energy common stock withheld to satisfy income tax obligations upon the vesting of restricted stock based on the price in effect at the grant date.

COMPARISON OF CUMULATIVE FIVE YEAR TOTAL RETURN

Total Return to DTE Energy Shareholders

(Includes reinvestment of dividends)


	Annual Return Percentage Year Ended December 31,
Company/Index	2017	2018	2019	2020	2021
DTE Energy Company	14.59	4.19	21.36	(2.90)	19.42
S&P 500 Index	21.82	(4.39)	31.48	18.39	28.68
S&P 500 Multi-Utilities Index	12.09	1.77	24.36	(5.87)	17.67


	Indexed Returns Year Ended December 31,
	Base Period
Company/Index	2016	2017	2018	2019	2020	2021
DTE Energy Company	100.00	114.59	119.39	144.90	140.69	168.01
S&P 500 Index	100.00	121.82	116.47	153.14	181.29	233.29
S&P 500 Multi-Utilities Index	100.00	112.09	114.07	141.86	133.53	157.13

Item 6. Selected Financial Data

Information is no longer required as the Registrants have adopted the SEC amendment to Regulation S-K to eliminate Item 301, Selected Financial Data.

Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations

The following combined discussion is separately filed by DTE Energy and DTE Electric. However, DTE Electric does not make any representations as to information related solely to DTE Energy or the subsidiaries of DTE Energy other than itself.

EXECUTIVE OVERVIEW

DTE Energy is a diversified energy company with 2021 Operating Revenues of approximately $15.0 billion and Total Assets of approximately $39.7 billion. DTE Energy is the parent company of DTE Electric and DTE Gas, regulated electric and natural gas utilities engaged primarily in the business of providing electricity and natural gas sales, distribution, and storage services throughout Michigan. DTE Energy also operates two energy-related non-utility segments with operations throughout the United States.

On July 1, 2021, DTE Energy completed the separation of its ~~businesses~~natural gas pipeline, storage and gathering non-utility business. Effective with the separation, DTE retains no ownership in the new company, DT Midstream, which was formerly comprised of DTE Energy’s Gas Storage and Pipelines segment and certain DTE Energy holding company activity within the Corporate and Other segment. Gas Storage and Pipelines is no longer a ~~disciplined manner if it can secure opportunities that meet its strategic,~~reportable segment of DTE Energy, and financial results of DT Midstream are presented as discontinued operations in the Consolidated Financial Statements. Refer to Note 4 to the Consolidated Financial Statements, “Dispositions and ~~risk criteria.~~

~~RESULTS OF OPERATIONS~~Impairments,” for additional information regarding the separation of DT Midstream and discontinued operations.

Management’s Discussion and Analysis of Financial Condition and Results of Operations ~~includes~~below reflect DTE Energy’s continuing operations, unless noted otherwise. The following table summarizes DTE Energy's financial ~~information prepared~~results:


	Years Ended December 31,
	2021		2020		2019
	(In millions, except per share amounts)
Net Income Attributable to DTE Energy Company — Continuing operations	$	796	$	1,054	$	955
Diluted Earnings per Common Share — Continuing operations	$	4.10	$	5.45	$	5.15

The decrease in ~~accordance with GAAP, as well as the non-GAAP financial measures, Utility Margin and Non-utility Margin, discussed below, which~~2021 Net Income Attributable to DTE Energy ~~uses as measures~~Company was primarily due to lower earnings in the Corporate and Other segment, driven primarily by losses on the extinguishment of its operational performance. Generally, a non-GAAP financial measure is a numerical measure of financial performance, financial position or cash flows that excludes (or includes) amounts that are includeddebt incurred in ~~(or excluded from) the most directly comparable measure calculated and presented~~2021. The decrease was also due to lower earnings in ~~accordance with GAAP.~~

~~DTE Energy uses Utility Margin and Non-utility Margin, non-GAAP financial measures, to assess its performance by reportable segment.~~

Utility Margin includes electric and gas Operating Revenues net of Fuel, purchased power, and gas expenses. The utilities’ fuel, purchased power, and natural gas supply are passed through to customers, and therefore, result in changes to the utilities’ revenues that are comparable to changes in such expenses. As such, DTE Energy believes Utility Margin provides a meaningful basis for evaluating the utilities’ operations across periods, as it excludes the revenue effect of fluctuations in these expenses.

The Non-utility Margin relates to the Power and Industrial Projects and Energy Trading segments. For the Power and Industrial Projects segment, Non-utility Margin primarily includes Operating Revenues net of Fuel, purchased power, and gas expenses. Operating Revenues include sales of refined coal to third parties and the affiliated Electric utility, metallurgical coke and related by-products, petroleum coke, renewable natural gas, and electricity, as well as rental income and revenues from utility-type consulting, management, and operational services. For the Energy Trading segment, ~~Non-utility Margin includes revenue~~partially offset by higher earnings in the Electric, Gas, and ~~realized~~DTE Vantage segments. The increase in 2020 Net Income Attributable to DTE Energy Company was primarily due to higher earnings in the Electric and ~~unrealized gains~~Corporate and ~~losses~~Other segments, partially offset by lower earnings in the Energy Trading segment.

STRATEGY

DTE Energy's strategy is to achieve long-term earnings growth with a strong balance sheet and an attractive dividend.

DTE Energy's utilities are investing capital to support a modern, reliable grid and cleaner, affordable energy through investments in base infrastructure and new generation. An increasing amount of high wind and other extreme weather events driven by climate change, coupled with increasing electric vehicle adoption, will drive a continued need for substantial grid investment over the long-term.

DTE Energy is committed to reducing the carbon emissions of its electric utility operations by 32% by 2023, 50% by 2028, and 80% by 2040 from ~~physical and financial power~~2005 carbon emissions levels. DTE Energy is also committed to a net zero carbon emissions goal by 2050 for its electric and gas ~~marketing, optimization,~~utility operations. To achieve the carbon reduction goals at the electric utility, DTE Energy has begun to transition away from coal-powered sources and ~~trading activities,~~is replacing or offsetting the generation from these facilities with renewable energy and energy waste reduction initiatives. Refer to the "Capital Investments" section below for further discussion regarding DTE Energy's retirement of its aging coal-fired plants and transition to renewable energy and other sources. Over the long-term, DTE Energy is also monitoring the viability of emerging technologies involving energy storage, carbon capture and sequestration, alternative fuels such as hydrogen, and advanced nuclear power.

For gas utility operations, DTE Energy aims to cut carbon emissions across the entire value chain.To achieve net ~~of Purchased power~~zero emissions by 2050 for both internal operations and from suppliers, DTE Energy is working to source gas with lower methane intensity, reduce emissions through its gas main renewal and pipeline integrity programs, and if necessary, use carbon offsets to address any remaining emissions. DTE Energy is also committed to helping DTE Gas customers reduce their emissions by 35% by 2050 by increasing energy efficiency, pursuing advanced technologies such as hydrogen, and through the CleanVision Natural Gas Balance program which provides customers the option to use carbon offsets and renewable natural gas.

DTE Energy expects that these initiatives at the electric and gas utilities will continue to provide significant opportunities for capital investments and result in earnings growth. DTE Energy is focused on executing its plans to achieve operational excellence and customer satisfaction with a focus on customer affordability. DTE Energy's utilities operate in a constructive regulatory environment and have solid relationships with their regulators.

DTE Energy also has significant investments in non-utility businesses and expects growth opportunities in its DTE Vantage segment. DTE Energy employs disciplined investment criteria when assessing growth opportunities that leverage its assets, skills, and expertise, and provides diversity in earnings and geography. Specifically, DTE Energy invests in targeted markets with attractive competitive dynamics where meaningful scale is in alignment with its risk profile.

A key priority for DTE Energy is to maintain a strong balance sheet which facilitates access to capital markets and reasonably priced short-term and long-term financing. Near-term growth will be funded through internally generated cash flows and the issuance of debt and equity. DTE Energy has an enterprise risk management program that, among other things, is designed to monitor and manage exposure to earnings and cash flow volatility related to commodity price changes, interest rates, and counterparty credit risk.

CAPITAL INVESTMENTS

DTE Energy's utility businesses require significant capital investments to maintain and improve the electric generation and electric and natural gas distribution infrastructure and to comply with environmental regulations and renewable energy requirements. Capital plans may be regularly updated as these ~~activities.~~ requirements change.

DTE Electric's capital investments over the 2022-2026 period are estimated at $15 billion, comprised of $8 billion for distribution infrastructure, $4 billion for base infrastructure, and $3 billion for cleaner generation including renewables. DTE Electric has retired six coal-fired generation units at the Trenton Channel, River Rouge, and St. Clair facilities and has announced plans to retire its remaining eleven coal-fired generating units, including five units at Trenton Channel and St. Clair in 2022. The two units at the Belle River facility will cease the use of coal by 2028 and will be evaluated for conversion to cleaner energy resources. The four units at the Monroe facility are expected to be retired by 2040. Generation from the retired facilities will be replaced or offset with a combination of renewables, energy waste reduction, demand response, and natural gas fueled generation, including the Blue Water Energy ~~evaluates its operating performance~~Center which will commence operations in 2022.

DTE Gas' capital investments over the 2022-2026 period are estimated at $3.1 billion, comprised of $1.5 billion for base infrastructure and $1.6 billion for gas main renewal, meter move out, and pipeline integrity programs.

DTE Electric and DTE Gas plan to seek regulatory approval for capital expenditures consistent with ratemaking treatment.

DTE Energy's non-utility businesses' capital investments are primarily for expansion, growth, and ongoing maintenance in the DTE Vantage segment, including approximately $1 billion to $1.5 billion from 2022-2026 for renewable energy and industrial energy services projects.

ENVIRONMENTAL MATTERS

The Registrants are subject to extensive environmental regulations, including those to address climate change. Additional costs may result as the effects of various substances on the environment are studied and governmental regulations are developed and implemented. Actual costs to comply could vary substantially. The Registrants expect to continue recovering environmental costs related to utility operations through rates charged to customers, as authorized by the MPSC.

Increased costs for energy produced from traditional coal-based sources due to recent, pending, and future regulatory initiatives could also increase the economic viability of energy produced from renewable, natural gas fueled generation, and/or nuclear sources, energy waste reduction initiatives, and the potential development of market-based trading of carbon instruments which could provide new business opportunities for DTE Energy's utility and non-utility segments. At the present time, it is not possible to quantify the financial impacts of these ~~non-utility businesses using~~climate related regulatory initiatives on the ~~measure of Operating Revenues net of Fuel, purchased power, and gas expenses.~~

Utility Margin and Non-utility Margin are not measures calculated in accordance with GAAP and should be viewed as a supplement to and not a substitute for the results of operations presented in accordance with GAAP. Utility Margin and Non-utility Margin do not intend to represent operating income, the most comparable GAAP measure, as an indicator of operating performance and are not necessarily comparable to similarly titled measures reported by other companies.

The following sections provide a detailed discussion of the operating performance and future outlook of DTE Energy's segments. Segment information, described below, includes intercompany revenues and expenses, and other income and deductions that are eliminated in the Consolidated Financial Statements.

2018 2017 2016
(In millions)
Net Income (Loss) Attributable to DTE Energy by Segment
Electric $ 664
$ 606
$ 622
Gas 150
146
138
Gas Storage and Pipelines 235
275
119
Power and Industrial Projects 161
138
95
Energy Trading 39
72
(45 )
Corporate and Other (129 ) (103 ) (61 )
Net Income Attributable to DTE Energy Company $ 1,120
$ 1,134
$ 868

~~ELECTRIC~~

~~The Results of Operations discussion for DTE Electric is presented in a reduced disclosure format in accordance with General Instruction I (2) (a) of Form 10-K for wholly-owned subsidiaries.~~

~~The Electric segment consists principally of DTE Electric. Electric results are discussed below:~~

2018 2017 2016
(In millions)
Operating Revenues — Utility operations $ 5,298
$ 5,102
$ 5,225
Fuel and purchased power — utility 1,552
1,454
1,532
Utility Margin 3,746
3,648
3,693
Operation and maintenance 1,437
1,382
1,408
Depreciation and amortization 836
753
750
Taxes other than income 307
302
284
Asset (gains) losses and impairments, net (1 ) —
—
Operating Income 1,167
1,211
1,251
Other (Income) and Deductions 310
284
276
Income Tax Expense 193
321
353
Net Income Attributable to DTE Energy Company $ 664
$ 606
$ 622
Registrants or their customers.

See ~~DTE Electric's Consolidated Statements of Operations in Item 8 of this Report for a complete view of its results. For an explanation of differences between the Electric segment~~Items 1. and ~~DTE Electric's Consolidated Statements of Operations, refer to~~2. Business and Properties and Note 2018 to the Consolidated Financial Statements, ~~"Retirement Benefits~~"Commitments and ~~Trusteed Assets.~~Contingencies,"

~~Utility Margin~~ increased $98 million in 2018 and decreased $45 million in 2017. Revenues associated with certain mechanisms and surcharges are offset by related expenses elsewhere in the Registrants' Consolidated Statements for further discussion of ~~Operations.~~Environmental Matters.

~~The following table details changes in various Utility Margin components relative to the comparable prior period:~~

2018 2017
(In millions)
Weather $ 152
$ (109 )
Implementation of new rates 51
124
Regulatory mechanism — TRM 40
(26 )
PSCR disallowance in 2017 13
(13 )
Base sales (3 ) (26 )
TCJA rate reduction (156 ) —
Other regulatory mechanisms and other 1
5
Increase (decrease) in Utility Margin $ 98
$ (45 )

2018 2017 2016
(In thousands of MWh)
DTE Electric Sales
Residential 15,959
14,885
15,875
Commercial 17,282
17,283
17,521
Industrial 10,324
9,897
10,004
Other 221
258
264
43,786
42,323
43,664
Interconnection sales^(a)
2,796
2,623
2,334
Total DTE Electric Sales 46,582
44,946
45,998

DTE Electric Deliveries
Retail and wholesale 43,786
42,323
43,664
Electric retail access, including self-generators^(b)
4,737
4,820
4,936
Total DTE Electric Sales and Deliveries 48,523
47,143
48,600


~~(a)~~	~~Represents power that is not distributed by DTE Electric.~~


~~(b)~~	~~Represents deliveries for self-generators that have purchased power from alternative energy suppliers to supplement their power requirements.~~

~~DTE Electric sales increased for residential, commercial, and industrial primarily due to favorable weather in 2018.~~

~~Operation and maintenance~~ expense increased $55 million in 2018 and decreased $26 million in 2017. The increase in 2018 was primarily due to increased uncollectible expense of $34 million due to customer billing initiatives following implementation of the new billing system, increased power plant generation expense of $24 million, an increase in energy waste reduction expense of $10 million to meet higher energy savings targets, partially offset by decreased distribution operations expense of $13 million. The decrease in 2017 was primarily due to decreased power plant generation expenses of $66 million, partially offset by increased storm restoration expenses of $27 million, and increased line clearance expenses of $10 million. The decrease in power plant generation includes an increase of $6 million of costs related to the 2016 fire at a generation facility, offset by $21 million of insurance proceeds received in 2017.

~~Depreciation and amortization~~ expense increased $83 million in 2018 and increased $3 million in 2017. In 2018, the increase was primarily due to an increase to depreciable base of $46 million and an increase of $42 million associated with the TRM, partially offset by a decrease in regulatory asset amortization of $5 million. In 2017, the increase was due to $45 million of increased expense from an increased depreciable base, partially offset by a decrease of $29 million associated with the TRM, and a decrease of $13 million in amortization of regulatory assets.

~~Other (Income) and Deductions~~ increased $26 million in 2018 and increased $8 million in 2017. The increase in 2018 was primarily due to higher interest expense of $9 million and change in investment earnings (loss of $11 million in 2018 compared to a gain of $26 million in 2017), partially offset by decreased non-operating retirement benefits expense of $13 million and a contribution to the DTE Energy Foundation of $7 million in 2017. The increase in 2017 was primarily due to higher interest expense of $10 million, lower interest income of $8 million related to a sales and use tax settlement received in 2016, and a $7 million contribution to the DTE Energy Foundation, partially offset by $12 million of higher investment earnings and a $3 million decrease in Low Income Self-Sufficiency Plan (LSP) contributions to not-for-profit organizations in 2016.

~~Outlook~~— DTE Electric will continue to move forward in its efforts to achieve operational excellence, sustain strong cash flows, and earn its authorized return on equity. DTE Electric expects that planned significant capital investments will result in earnings growth. DTE Electric will maintain a strong focus on customers by increasing reliability and satisfaction while keeping customer rate increases affordable. Looking forward, additional factors may impact earnings such as weather, the outcome of regulatory proceedings, benefit plan design changes, investment returns and changes in discount rate assumptions in benefit plans and health care costs, uncertainty of legislative or regulatory actions regarding climate change, and effects of energy waste reduction programs.

DTE Electric filed a rate case with the MPSC on July 6, 2018 requesting an increase in base rates of $328 million based on a projected twelve-month period ending April 30, 2020. The requested increase in base rates is primarily due to an increase in net plant resulting from infrastructure investments, depreciation expense, as requested in the 2016 DTE Electric Depreciation Case Filing, and reliability improvement projects. The rate filing also requests an increase in return on equity from 10.0% to 10.5% and includes projected changes in sales, operation and maintenance expenses, and working capital. In addition, the rate filing requests an Infrastructure Recovery Mechanism to recover the incremental revenue requirement associated with certain distribution, fossil generation, and nuclear generation capital expenditures through 2022. DTE Electric also included Calculation C in this filing to address all remaining issues relative to the enactment of the TCJA, which is primarily the remeasurement of deferred taxes and how the amounts deferred as Regulatory liabilities will flow to ratepayers. A final MPSC order in this case is expected by May 2019. Refer to Note 9 to the Consolidated Financial Statements, “Regulatory Matters” for additional information.

~~GAS~~

~~The Gas segment consists principally of DTE Gas. Gas results are discussed below:~~

2018 2017 2016
(In millions)
Operating Revenues — Utility operations $ 1,436
$ 1,388
$ 1,324
Cost of gas — utility 446
443
454
Utility Margin 990
945
870
Operation and maintenance 502
449
440
Depreciation and amortization 133
123
106
Taxes other than income 73
65
64
Asset (gains) losses and impairments, net —
—
4
Operating Income 282
308
256
Other (Income) and Deductions 65
84
41
Income Tax Expense 67
78
77
Net Income Attributable to DTE Energy Company $ 150
$ 146
$ 138

~~Utility Margin~~ increased $45 million in 2018 and increased $75 million in 2017. Revenues associated with certain surcharges are offset by related expenses elsewhere in DTE Energy's Consolidated Statements of Operations.

~~The following table details changes in various Utility Margin components relative to the comparable prior period:~~

2018 2017
(In millions)
Weather $ 46
$ (6 )
Implementation of new rates 15
80
Midstream storage and transportation revenues 15
(5 )
Regulatory mechanism — RDM (3 ) 4
TCJA rate reduction (40 ) —
Other regulatory mechanisms and other 12
2
Increase in Utility Margin $ 45
$ 75

2018 2017 2016
(In Bcf)
Gas Markets
Gas sales 135
119
116
End-user transportation 187
165
182
322
284
298
Intermediate transportation 329
260
214
Total Gas sales 651
544
512

~~Operation and maintenance~~ expense increased $53 million in 2018 and increased $9 million in 2017. The increase in 2018 was primarily due to increased uncollectible expense of $28 million due to customer billing initiatives following implementation of a new customer billing system and higher gas operations expenses of $22 million, which included increased investment spending and higher pipeline integrity expenses. The increase in 2017 was primarily due to increased corporate expenses of $3 million and increased gas operations expenses of $3 million.

~~Depreciation and amortization~~ expense increased $10 million in 2018 and increased $17 million in 2017. The increase in 2018 was primarily due to an increased depreciable base. The increase in 2017 was primarily due to an increased depreciable base and higher depreciation rates.

~~Other (Income) and Deductions~~ decreased $19 million in 2018 and increased $43 million in 2017. The decrease in 2018 was primarily due to lower contributions to the DTE Energy Foundation and other not-for-profit organizations of $27 million, partially offset by higher net interest expense of $6 million. The increase in 2017 was primarily due to increased non-operating retirement benefits expenses of $31 million, increased contributions to the DTE Energy Foundation and other not-for-profit organizations of $7 million and higher interest expense of $5 million.

~~Outlook —~~ DTE Gas will continue to move forward in its efforts to achieve operational excellence, sustain strong cash flows, and earn its authorized return on equity. DTE Gas expects that planned significant infrastructure capital investments will result in earnings growth. Looking forward, additional factors may impact earnings such as weather, the outcome of regulatory proceedings, benefit plan design changes, and investment returns and changes in discount rate assumptions in benefit plans and health care costs. DTE Gas expects to continue its efforts to improve productivity and decrease costs while improving customer satisfaction with consideration of customer rate affordability.

DTE filed its Calculation C case with the MPSC on November 16, 2018 to reduce the revenue requirement by $12 million related to the amortization of deferred tax remeasurement. Calculation C addresses all remaining issues relative to the enactment of the TCJA, which is primarily the remeasurement of deferred taxes and how the amounts deferred as Regulatory liabilities will flow to ratepayers. Refer to Note 9 to the Consolidated Financial Statements, “Regulatory Matters” for additional information.

~~GAS STORAGE AND PIPELINES~~

~~The Gas Storage and Pipelines segment consists of the non-utility gas pipelines and storage businesses. Gas Storage and Pipelines results are discussed below:~~

2018 2017 2016
(In millions)
Operating Revenues — Non-utility operations $ 485
$ 453
$ 302
Cost of gas — Non-utility 22
30
6
Operation and maintenance 103
83
81
Depreciation and amortization 82
76
45
Taxes other than income 8
8
4
Asset (gains) losses and impairments, net —
2
—
Operating Income 270
254
166
Other (Income) and Deductions (61 ) (18 ) (31 )
Income Tax Expense (Benefit) 68
(30 ) 71
Net Income 263
302
126
Less: Net Income Attributable to Noncontrolling Interests 28
27
7
Net Income Attributable to DTE Energy Company $ 235
$ 275
$ 119

~~Operating Revenues — Non-utility operations~~ increased $32 million in 2018 and increased $151 million in 2017. The increase in both periods was primarily due to increased pipeline and gathering volumes. The 2017 increase was also due to the acquisition of AGS and SGG in October 2016.

~~Cost of gas — Non-utility~~ decreased $8 million in 2018 and increased $24 million in 2017. The 2018 decrease was driven by lower physical purchases of gas from AGS customers for resale to optimize available transportation capacity. The 2017 increase was driven by higher physical purchases of gas from AGS customers for resale to optimize available transportation capacity.

~~Operation and maintenance~~ expense increased $20 million in 2018 and increased $2 million in 2017. The 2018 increase was primarily due to increased labor related expenses and additional compression activity on the Bluestone Pipeline and Susquehanna gathering systems.

~~Depreciation and amortization~~ ~~expense increased $6 million in 2018 and increased $31 million in 2017. The 2017 increase was primarily due to the acquisition of AGS and SGG in October 2016.~~

~~Other (Income) and Deductions~~ increased $43 million in 2018 and decreased $13 million in 2017. The 2018 increase was primarily due to increased earnings from pipeline investments and a $16 million net loss on extinguishment of debt within the storage business in 2017, partially offset by higher interest expense. The 2017 decrease was primarily due to a $16 million net loss on extinguishment of debt within the storage business and contributions to the DTE Energy Foundation and other not-for-profit organizations, partially offset by increased earnings from pipeline investments.

~~Income Tax Expense (Benefit)~~ increased $98 million in 2018 and decreased $101 million in 2017. The changes were primarily driven by the $115 million remeasurement of deferred tax assets and liabilities to reflect the reduction in the corporate tax rate from the enactment of the TCJA in December 2017. The 2017 change was partially offset by increased tax expense on higher earnings in 2017.

~~Net Income Attributable to Noncontrolling Interests~~ ~~increased $1 million in 2018 and increased $20 million in 2017. The 2017 increase was primarily due to the acquisition of SGG in October 2016.~~

~~Outlook —~~ ~~DTE Energy believes its long-term agreements with producers and the quality of the natural gas reserves in the Marcellus/Utica region soundly position the gathering systems for future revenues.~~

NEXUS Pipeline was placed in service in in October 2018. The NEXUS Pipeline provides a transportation path for Appalachian Basin shale gas, including Utica and Marcellus shale gas, directly to consuming markets in northern Ohio, southeastern Michigan, and Dawn Ontario. DTE Energy owns a 50% partnership interest in the NEXUS Pipeline with an investment balance of $1.26 billion at December 31, 2018.

On January 11, 2019, NEXUS signed an agreement to purchase Generation Pipeline, LLC, a public utility regulated by the Public Utilities Commission of Ohio. This 23-mile pipeline system supplies gas to industrial customers in the Toledo, OH area, has existing interconnects with ANR Pipeline Company and Panhandle Eastern Pipeline Company, and is located 4 miles away from Nexus. The transaction is expected to close in the first half of 2019 upon regulatory approvals.

AGS and SGG provide a platform for midstream growth and access to further investment opportunities in the Appalachian basin, an additional connection to the NEXUS Pipeline which should drive incremental volumes on the NEXUS Pipeline, and producer relationships that may lead to more partnering opportunities.

Gas Storage and Pipelines expects to maintain its steady growth by developing an asset portfolio with multiple growth platforms through investment in new projects and expansions. Gas Storage and Pipelines will continue to look for additional investment opportunities and other storage and pipeline projects at favorable prices.

~~POWER AND INDUSTRIAL PROJECTS~~

The Power and Industrial Projects segment is comprised primarily of projects that deliver energy and utility-type products and services to industrial, commercial, and institutional customers, produce reduced emissions fuel, and sell electricity and pipeline-quality gas from renewable energy projects. Power and Industrial Projects results are discussed below:

2018 2017 2016
(In millions)
Operating Revenues — Non-utility operations $ 2,204
$ 2,089
$ 1,906
Fuel, purchased power, and gas — non-utility 1,888
1,813
1,640
Non-utility Margin 316
276
266
Operation and maintenance 363
342
317
Depreciation and amortization 67
72
72
Taxes other than income 12
11
13
Asset (gains) losses and impairments, net 27
20
(1 )
Operating Loss (153 ) (169 ) (135 )
Other (Income) and Deductions (89 ) (63 ) (49 )
Income Taxes
Benefit (7 ) (42 ) (26 )
Production Tax Credits (188 ) (153 ) (114 )
(195 ) (195 ) (140 )
Net Income 131
89
54
Less: Net Loss Attributable to Noncontrolling Interests (30 ) (49 ) (41 )
Net Income Attributable to DTE Energy Company $ 161
$ 138
$ 95

~~Operating Revenues — Non-utility operations~~ ~~increased $115 million in 2018 and increased $183 million in 2017. The changes are due to the following:~~

2018
(In millions)
Higher demand due to improved conditions in the steel business $ 59
Higher production in the renewables business 25
Higher production, offset by lower coal prices in the REF business 18
Higher sales primarily associated with new contracts in the on-site business 13
$ 115

2017
(In millions)
Higher demand due to improved conditions in the steel business $ 107
Higher production driven by new projects, offset by lower coal prices in the REF business 102
Lower production and one-time recovery in 2016, offset by an acquisition in the renewables business (9 )
Lower sales primarily associated with expired contracts in the on-site business (17 )
$ 183

~~Non-utility Margin~~ ~~increased $40 million in 2018 and increased $10 million in 2017. The changes are due to the following:~~

2018
(In millions)
Higher production in the renewables business $ 20
Higher sales primarily associated with new contracts in the on-site business 12
Higher demand due to improved conditions in the steel business 8
$ 40

2017
(In millions)
Higher demand due to improved conditions in the steel business $ 42
Lower production and one-time recovery in 2016 in the renewables business (11 )
Lower sales primarily associated with expired contracts in the on-site business (15 )
Other (6 )
$ 10

~~Operation and maintenance~~ expense increased $21 million in 2018 and increased $25 million in 2017. The 2018 increase was primarily due to higher production in the REF business of $11 million and new contracts in the on-site business of $8 million. The 2017 increase was primarily due to an increase in maintenance spending driven by improved conditions in the steel business of $16 million, higher maintenance and a new acquisition in the renewables business of $7 million, and an increase associated with new projects in the REF business of $5 million, offset by lower spending as a result of Shenango plant closure activities in the first half of 2016 of $6 million.

~~Asset (gains) losses and impairments, net~~ increased $7 million in 2018 from the net loss of $20 million in 2017 and decreased $21 million in 2017 from the net gain of $1 million in 2016. The 2018 increase was primarily due to $15 million of a liability adjustment related to contingent consideration and an $8 million asset write-off associated with the renewable business in anticipation of a contract ending in 2020. The 2017 decrease was primarily due to an impairment in the REF business of $14 million and an impairment of a petroleum coke project of $6 million.

~~Other (Income) and Deductions~~ increased $26 million in 2018 and increased $14 million in 2017. The 2018 increase was primarily due to higher production in the REF business of $20 million and decreased contributions to the DTE Energy Foundation of $4 million. The 2017 increase was primarily due to increased equity earnings in the renewable business of $9 million and insurance settlements in the renewable and REF businesses of $6 million, offset by increased contributions to the DTE Energy Foundation of $6 million.

~~Income Taxes — Benefit~~ decreased by $35 million in 2018 and increased by $16 million in 2017. The 2018 decrease was primarily due to the 2017 remeasurement of deferred tax assets and liabilities to reflect the reduction in the corporate tax rate from the enactment of the TCJA in December 2017. The increase in 2017 was primarily due to the remeasurement of deferred tax assets and liabilities to reflect the reduction in the corporate tax rate from the enactment of the TCJA in December 2017 of $21 million, an increase due to higher pretax loss of $7 million, and a decrease due to a worthless stock deduction associated with the Shenango closure in 2016 of $10 million.

~~Income Taxes — Production Tax Credits~~ ~~increased by $35 million in 2018 and increased $39 million in 2017. The increase in both periods was primarily due to higher production in the REF business.~~

~~Net Loss Attributable to Noncontrolling Interests~~ decreased by $19 million in 2018 and increased by $8 million in 2017. The 2018 decrease was primarily due to termination of a project in the REF business. The 2017 increase was primarily due to a change in the ownership percentage in one of the REF projects of $8 million.

~~Outlook —~~ Power and Industrial Projects has constructed and placed in service REF facilities at ten sites including facilities located at seven third-party owned coal-fired power plants. DTE Energy has sold membership interests in five of the facilities and entered into lease arrangements in three of the facilities. Three REF facilities will phase out in 2019 with the remaining seven to be phased out at the end of 2021.

Power and Industrial Projects will continue to leverage its extensive energy-related operating experience and project management capability to develop additional energy projects to serve energy intensive industrial customers.

ENERGY TRADING

Description

Energy Trading focuses on physical and financial power, ~~and~~ natural gas and environmental marketing and trading, structured transactions, enhancement of returns from its asset portfolio, and optimization of contracted natural gas pipeline transportation and storage positions. Energy Trading also provides natural gas, power, environmental and related services which may include the management of associated storage and transportation contracts on the customers’ behalf and the supply or purchase of environmental attributes to various customers. Energy Trading's customer base is predominantly utilities, local distribution companies, pipelines, producers and generators, and other marketing and trading companies. Energy Trading also provides commodity risk management services to the other businesses within DTE Energy.

Regulation

Strategy and Competition

CORPORATE AND OTHER

Corporate and Other includes various holding company activities, holds certain non-utility debt, and holds certain investments, including funds supporting regional development and economic growth.

ENVIRONMENTAL MATTERS


	DTE Electric		DTE Gas		Total
	(In millions)

Water	$	10	$	—	$	10
Contaminated and other sites	12		14		26
Coal combustion residuals and effluent limitations guidelines	417		—		417
Estimated total future expenditures through 2026	$	439	$	14	$	453
Estimated 2022 expenditures	$	81	$	8	$	89
Estimated 2023 expenditures	$	65	$	3	$	68

HUMAN CAPITAL MANAGEMENT

DTE Energy and utilities across the country are managing the turnover of our workforce due to a significant number of retirements expected in the next ten years - a period that will be impacted by major transformation of our business through technology investments, changes to our electric generation portfolio, and upgrades to our distribution infrastructure.

Amidst this challenge, DTE Energy is building a culture of highly engaged employees with skills and expertise in science, technology, engineering, math, analytics, and skilled trades, which are in high demand and critical to our industry. To attract and retain the best talent, DTE Energy promotes the engagement of its employees through diversity, equity, and inclusion; health, safety, and well-being; and compensation and benefits.

Diversity, Equity, and Inclusion (DEI)

•Diversity of candidates, hires, high potential talent, and leadership promotions

•Employee engagement, including specific elements that measure a culture of inclusion

•Number of DEI related communications and events

•Supplier diversity spend

•Rankings and scores from DEI benchmarking surveys

•Formal training programs, including unconscious bias training for employees and leaders

Health, Safety, and Well-being

Safety

COVID-19 Response

Culture of Health and Well-being

Compensation and Benefits

DTE Energy provides competitive, customizable benefits for all regular full-time and regular part-time employees. Innovative compensation and benefits initiatives at DTE Energy include:

•Competitive health and welfare benefits

•Child bonding/parental leave of absence

•Additional vacation days available for employee purchase

•Competitive incentive plans, which are offered to all non-represented employees to create alignment of corporate and individual goals

Incentive Plans

For additional information on the metrics above, please see the "Annual and Long-term Incentives" section of DTE Energy's Proxy Statement.

Item 1A. Risk Factors

Regulatory, Legislative, and Legal Risks

Operational Risks

Weather, including extreme weather caused by climate change, significantly affects operations. At both utilities, deviations from normal hot and cold weather conditions affect the Registrants' earnings and cash flows. Mild temperatures can result in decreased utilization of the Registrants' assets, lowering income and cash flows. At DTE Electric, ice storms, floods, tornadoes, or high winds can damage the electric distribution system infrastructure and power generation facilities and require it to perform emergency repairs and incur material unplanned expenses. The expenses of storm restoration efforts may not be fully recoverable through the regulatory process. Prolonged and/or more frequent outages caused by extreme weather could also negatively impact DTE Energy's reputation and customer satisfaction or result in increased regulatory oversight, and related damages to customer assets could subject DTE Energy to litigation. DTE Gas can also experience higher than anticipated expenses from emergency repairs on its gas distribution infrastructure required as a result of weather-related issues.

A work interruption may adversely affect the Registrants. There are several bargaining units for DTE Energy's approximately 5,200 and DTE Electric's approximately 2,700 represented employees. The majority of represented employees are under contracts that expire in 2027. A union choosing to strike would have an impact on the Registrants' businesses. The Registrants are unable to predict the effect a work stoppage would have on their costs of operations and financial performance.

DTE Energy may not achieve the net zero carbon emissions goals of its electric and gas utilities. DTE Energy has announced the voluntary commitments of its electric and gas utilities to achieve net zero carbon emissions by 2050. Technology research and developments, innovations, and advancements are critical to DTE Energy's ability to achieve this commitment. Other factors that may impact DTE Energy's ability to achieve these net zero goals include our service territory size and capacity needs remaining in line with current expectations, the impacts on our business of future regulations or legislation, the price and availability of carbon offsets, adoption of alternative energy products by the public such as greater use of electric vehicles, greater standardization of emissions reporting, and our ability over time to transition our electric generating portfolio. DTE Energy's net zero goals require making assumptions that involve risks and uncertainties. Should one or more of these underlying assumptions prove incorrect, our actual results and ability to achieve net zero emissions by 2050 could differ materially from expectations. In addition, DTE Energy cannot predict the ultimate impact of achieving this objective, or the various implementation aspects on its reliability or its results of operations, financial condition, or liquidity.

Financial, Economic, and Market Risks

Safety and Security Risks

The Registrants' businesses have safety risks. The Registrants' electric distribution system, power plants, renewable energy equipment, and other facilities, and DTE Energy's gas distribution system, gas infrastructure, and other facilities, could be involved in incidents that result in injury, death, or property loss to employees, customers, third parties, or the public. Although the Registrants have insurance coverage for many potential incidents, depending upon the nature and severity of any incident, they could experience financial loss, damage to their reputation, and negative consequences from regulatory agencies or other public authorities.

Threats of cyber incidents, physical security, and terrorism could affect the Registrants' business. Issues may threaten the Registrants such as cyber incidents, physical security, or terrorism that may disrupt the Registrants' operations, and could harm the Registrants' operating results.

Failure to maintain the security of personally identifiable information could adversely affect the Registrants. In connection with the Registrants' businesses, they collect and retain personally identifiable information of their customers, shareholders, and employees. Customers, shareholders, and employees expect that the Registrants will adequately protect their personal information. The regulatory environment surrounding information security and privacy is increasingly demanding. A significant theft, loss, or fraudulent use of customer, shareholder, employee, or Registrant data by cybercrime or otherwise, could adversely impact the Registrants' reputation, and could result in significant costs, fines, and litigation.

General and Other Risks

The COVID-19 pandemic and resulting impact on business and economic conditions could negatively affect the Registrants' businesses and operations. The COVID-19 pandemic is currently impacting countries, communities, supply chains and markets. The continued spread of COVID-19 and efforts to contain the virus, such as quarantines, closures, or reduced operations of businesses, governmental agencies and other institutions, have resulted in disruptions in various public, commercial, and industrial activities and have caused employee absences which interfered with certain operation and maintenance of the Registrants' facilities. Travel bans and restrictions, quarantines, and shelter in place orders could also cause us to experience operational delays, delay the delivery of critical infrastructure and other supplies we source globally, or delay the connection of electric or gas service to new customers, and have reduced the use of electricity and gas by certain customers in the commercial and industrial segments. Any of the foregoing circumstances could adversely affect customer demand or revenues, impact the ability of the Registrants' suppliers, vendors or contractors to perform, or cause other unpredictable events, which could adversely affect the Registrants' businesses, results of operations or financial condition. The continued spread of COVID-19 has also led to disruption and volatility in the financial markets, which could increase the Registrants' costs to fund capital requirements and impact the operating results of our energy trading operations. To the extent that the Registrants' access to the capital markets is adversely affected by COVID-19, the Registrants may need to consider alternative sources of funding for our operations and for working capital, any of which could increase the Registrants' cost of capital. The extent to which COVID-19 may continue to impact the Registrants' liquidity, financial condition, and results of operations will depend on future developments, which are highly uncertain and cannot be predicted, including new information concerning the severity of COVID-19 and its related variants, vaccine distribution and public acceptance, and other actions taken to contain it or treat its impact, and the extent to which normal economic and operating conditions can resume, among others. Our business continuity plans and insurance coverage may be insufficient to mitigate these adverse impacts to our business.

Failure to attract and retain key executive officers and other skilled professional and technical employees could have an adverse effect on the Registrants’ operations. The Registrants' businesses are dependent on their ability to attract and retain skilled employees. Competition for skilled employees in some areas is high, and the inability to attract and retain these employees could adversely affect the Registrants' business and future operating results. In addition, the Registrants have an aging utility workforce, and the failure of a successful transfer of knowledge and expertise could negatively impact their operations.

The spin-off of DT Midstream (the "Spin-off") may not achieve its intended benefits and may present additional risk to DTE Energy. As a result of the Spin-off, DTE Energy faces new and unique risks, including having fewer assets, reduced financial resources and less diversification of revenue sources. The Spin-off may not achieve some or all of its anticipated benefits and we face risks providing DT Midstream with transition services. Each of these factors may adversely impact DTE Energy's financial condition, results of operations, and cash flows.

In connection with the Spin-off, DTE received a legal opinion that the distribution of shares of DT Midstream to DTE Energy shareholders qualifies as tax-free under Section 355 of the U.S. Internal Revenue Code. However, if the IRS determined on audit that the distribution is taxable, both DTE Energy and our shareholders could incur significant U.S. federal income tax liabilities.

Following the Spin-off, the management and directors of each of DTE Energy and DT Midstream own common stock in both companies, and Robert Skaggs, Jr., who is DT Midstream's Executive Chairman, also serves on DTE Energy's Board and may be required to recuse himself from deliberations relating to arrangements between DTE Energy and DT Midstream in the future. This ownership and directorship overlap could create, or appear to create, potential conflicts of interest when the management and directors of one company face decisions that could have different implications for themselves and the other company. Potential conflicts of interest may also arise out of commercial arrangements that DTE Energy and DT Midstream have or may enter into in the future.

Item 1B. Unresolved Staff Comments

None.

Item 3. Legal Proceedings

For more information on legal proceedings and matters related to the Registrants, see Notes 9 and 18 to the Consolidated Financial Statements, "Regulatory Matters" and "Commitments and Contingencies," respectively.

For environmental proceedings in which the government is a party, the Registrants include disclosures if any sanctions of $1 million or greater are expected.

Item 4. Mine Safety Disclosures

Not applicable.

Part II

Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters, and Issuer Purchases of Equity Securities

DTE Energy common stock is listed under the ticker symbol "DTE" on the New York Stock Exchange, which is the principal market for such stock.

At December 31, 2021, there were 193,747,509 shares of DTE Energy common stock outstanding. These shares were held by a total of 45,230 shareholders of record.

For information on DTE Energy dividend restrictions, see Note 16 to the Consolidated Financial Statements, "Short-Term Credit Arrangements and Borrowings."

All of DTE Energy's equity compensation plans that provide for the annual awarding of stock-based compensation have been approved by shareholders. For additional detail, see Note 21 to the Consolidated Financial Statements, "Stock-Based Compensation."

See the following table for information as of December 31, 2021:


	Number of Securities to be Issued Upon Exercise of Outstanding Options	Weighted-Average Exercise Price of Outstanding Options		Number of Securities Remaining Available for Future Issuance Under Equity Compensation Plans
Plans approved by shareholders	—	$	—	4,221,599

UNREGISTERED SALES OF DTE ENERGY EQUITY SECURITIES AND USE OF PROCEEDS

Purchases of DTE Energy Equity Securities by the Issuer and Affiliated Purchasers


	Number of Shares Purchased(a)	Average Price Paid per Share(a)		Number of Shares Purchased as Part of Publicly Announced Plans or Programs	Average Price Paid per Share	Maximum Dollar Value that May Yet Be Purchased Under the Plans or Programs
10/01/2021 — 10/31/2021	1,028	$	108.95	—	—	—
11/01/2021 — 11/30/2021	2,653	$	105.32	—	—	—
12/01/2021 — 12/31/2021	505	$	115.23	—	—	—
Total	4,186			—

(a)Represents shares of DTE Energy common stock withheld to satisfy income tax obligations upon the vesting of restricted stock based on the price in effect at the grant date.

COMPARISON OF CUMULATIVE FIVE YEAR TOTAL RETURN

Total Return to DTE Energy Shareholders

(Includes reinvestment of dividends)


	Annual Return Percentage Year Ended December 31,
Company/Index	2017	2018	2019	2020	2021
DTE Energy Company	14.59	4.19	21.36	(2.90)	19.42
S&P 500 Index	21.82	(4.39)	31.48	18.39	28.68
S&P 500 Multi-Utilities Index	12.09	1.77	24.36	(5.87)	17.67


	Indexed Returns Year Ended December 31,
	Base Period
Company/Index	2016	2017	2018	2019	2020	2021
DTE Energy Company	100.00	114.59	119.39	144.90	140.69	168.01
S&P 500 Index	100.00	121.82	116.47	153.14	181.29	233.29
S&P 500 Multi-Utilities Index	100.00	112.09	114.07	141.86	133.53	157.13

Item 6. Selected Financial Data

Information is no longer required as the Registrants have adopted the SEC amendment to Regulation S-K to eliminate Item 301, Selected Financial Data.

Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations

EXECUTIVE OVERVIEW

On July 1, 2021, DTE Energy completed the separation of its natural gas pipeline, storage and gathering non-utility business. Effective with the separation, DTE retains no ownership in the new company, DT Midstream, which was formerly comprised of DTE Energy’s Gas Storage and Pipelines segment and certain DTE Energy holding company activity within the Corporate and Other segment. Gas Storage and Pipelines is no longer a reportable segment of DTE Energy, and financial results of DT Midstream are presented as discontinued operations in the Consolidated Financial Statements. Refer to Note 4 to the Consolidated Financial Statements, “Dispositions and Impairments,” for additional information regarding the separation of DT Midstream and discontinued operations.

Management’s Discussion and Analysis of Financial Condition and Results of Operations below reflect DTE Energy’s continuing operations, unless noted otherwise. The following table summarizes DTE Energy's financial results:


	Years Ended December 31,
	2021		2020		2019
	(In millions, except per share amounts)
Net Income Attributable to DTE Energy Company — Continuing operations	$	796	$	1,054	$	955
Diluted Earnings per Common Share — Continuing operations	$	4.10	$	5.45	$	5.15

The decrease in 2021 Net Income Attributable to DTE Energy Company was primarily due to lower earnings in the Corporate and Other segment, driven primarily by losses on the extinguishment of debt incurred in 2021. The decrease was also due to lower earnings in the Energy Trading segment, partially offset by higher earnings in the Electric, Gas, and DTE Vantage segments. The increase in 2020 Net Income Attributable to DTE Energy Company was primarily due to higher earnings in the Electric and Corporate and Other segments, partially offset by lower earnings in the Energy Trading segment.

STRATEGY

DTE Energy's strategy is to achieve long-term earnings growth with a strong balance sheet and an attractive dividend.

DTE Energy is committed to reducing the carbon emissions of its electric utility operations by 32% by 2023, 50% by 2028, and 80% by 2040 from 2005 carbon emissions levels. DTE Energy is also committed to a net zero carbon emissions goal by 2050 for its electric and gas utility operations. To achieve the carbon reduction goals at the electric utility, DTE Energy has begun to transition away from coal-powered sources and is replacing or offsetting the generation from these facilities with renewable energy and energy waste reduction initiatives. Refer to the "Capital Investments" section below for further discussion regarding DTE Energy's retirement of its aging coal-fired plants and transition to renewable energy and other sources. Over the long-term, DTE Energy is also monitoring the viability of emerging technologies involving energy storage, carbon capture and sequestration, alternative fuels such as hydrogen, and advanced nuclear power.

For gas utility operations, DTE Energy aims to cut carbon emissions across the entire value chain.To achieve net zero emissions by 2050 for both internal operations and from suppliers, DTE Energy is working to source gas with lower methane intensity, reduce emissions through its gas main renewal and pipeline integrity programs, and if necessary, use carbon offsets to address any remaining emissions. DTE Energy is also committed to helping DTE Gas customers reduce their emissions by 35% by 2050 by increasing energy efficiency, pursuing advanced technologies such as hydrogen, and through the CleanVision Natural Gas Balance program which provides customers the option to use carbon offsets and renewable natural gas.

CAPITAL INVESTMENTS

DTE Electric and DTE Gas plan to seek regulatory approval for capital expenditures consistent with ratemaking treatment.

ENVIRONMENTAL MATTERS

See Items 1. and 2. Business and Properties and Note 18 to the Consolidated Financial Statements, "Commitments and Contingencies," for further discussion of Environmental Matters.

OUTLOOK

The next few years will be a period of rapid change for DTE Energy and for the energy industry. DTE Energy's strong utility base, combined with its integrated non-utility operations, position it well for long-term growth.

Looking forward, DTE Energy will focus on several areas that are expected to improve future performance:

•electric and gas customer satisfaction;

•electric distribution system reliability;

•new electric generation and decarbonization;

•gas distribution system renewal;

•rate competitiveness and affordability;

•regulatory stability and investment recovery for the electric and gas utilities;

•strategic investments in growth projects at DTE Vantage;

•employee engagement, health, safety and well-being, and diversity, equity, and inclusion;

•cost structure optimization across all business segments; and

•cash, capital, and liquidity to maintain or improve financial strength.

The separation of DT Midstream on July 1, 2021 will result in a reduction to DTE Energy's net income and cash flows in the near term. However, DTE Energy remains well-positioned for long-term growth and focused on the key objectives noted above. DTE Energy will continue to pursue opportunities to grow its businesses in a disciplined manner if it can secure opportunities that meet its strategic, financial, and risk criteria.

COVID-19 Pandemic

DTE Energy has been monitoring the COVID-19 pandemic and any related impacts to operating costs, customer demand, and the recoverability of assets in our business segments that could materially impact the Registrants' financial results.

As noted in Note 18 to the Consolidated Financial Statements, "Commitments and Contingencies," the pandemic has contributed to a shift in electric sales volumes from commercial and industrial customers to residential customers. DTE Energy expects this shift to continue in the near term as businesses maintain more remote operations. Other impacts from COVID-19 have related primarily to health and safety-related costs at the utilities and volumes at certain non-utility businesses, but these impacts have not been significant in 2021.

Please see detailed explanations of segment performance in the "Results of Operations" section below, including impacts from the COVID-19 pandemic where applicable.

DTE Energy will continue to monitor these impacts as well as any regulatory and legislative activities related to COVID-19. The Registrants cannot predict the ultimate impact of these factors to our Consolidated Financial Statements as future developments involving COVID-19 and related impacts on economic and operating conditions are highly uncertain. For further discussion of these uncertainties, refer to "Risk Factors" in Item 1A. of this Report.

RESULTS OF OPERATIONS

Management’s Discussion and Analysis of Financial Condition and Results of Operations includes financial information prepared in accordance with GAAP, as well as the non-GAAP financial measures, Utility Margin and Non-utility Margin, discussed below, which DTE Energy uses as measures of its operational performance. Generally, a non-GAAP financial measure is a numerical measure of financial performance, financial position or cash flows that excludes (or includes) amounts that are included in (or excluded from) the most directly comparable measure calculated and presented in accordance with GAAP.

DTE Energy uses Utility Margin and Non-utility Margin, non-GAAP financial measures, to assess its performance by reportable segment.

Utility Margin includes electric utility and gas utility Operating Revenues net of Fuel, purchased power, and gas expenses. The utilities’ fuel, purchased power, and natural gas supply are passed through to customers, and therefore, result in changes to the utilities’ revenues that are comparable to changes in such expenses. As such, DTE Energy believes Utility Margin provides a meaningful basis for evaluating the utilities’ operations across periods, as it excludes the revenue effect of fluctuations in these expenses. For the Electric segment, non-utility Operating Revenues are reported separately so that Utility Margin can be used to assess utility performance.

The Non-utility Margin relates to the DTE Vantage and Energy Trading segments. For the DTE Vantage segment, Non-utility Margin primarily includes Operating Revenues net of Fuel, purchased power, and gas expenses. Operating Revenues include sales of refined coal to third parties and the affiliated Electric utility, metallurgical coke and related by-products, petroleum coke, renewable natural gas and related credits, and electricity, as well as rental income and revenues from utility-type consulting, management, and operational services. For the Energy Trading segment, Non-utility Margin includes revenue and realized and unrealized gains and losses from physical and financial power and gas marketing, optimization, and trading activities, net of Purchased power and gas related to these activities. DTE Energy evaluates its operating performance of these non-utility businesses using the measure of Operating Revenues net of Fuel, purchased power, and gas expenses.


	2021		2020		2019
	(In millions)
Net Income (Loss) Attributable to DTE Energy by Segment
Electric	$	864	$	777	$	714
Gas	214		186		185
DTE Vantage	168		134		133
Energy Trading	(83)		36		49
Corporate and Other	(367)		(79)		(126)
Income From Continuing Operations Attributable to DTE Energy Company	796		1,054		955
Discontinued Operations	111		314		214
Net Income Attributable to DTE Energy Company	$	907	$	1,368	$	1,169

ELECTRIC

The Results of Operations discussion for DTE Electric is presented in a reduced disclosure format in accordance with General Instruction I (2) (a) of Form 10-K for wholly-owned subsidiaries.

The Electric segment consists principally of DTE Electric. Electric results and outlook are discussed below:


	2021		2020		2019
	(In millions)
Operating Revenues — Utility operations	$	5,809	$	5,506	$	5,224
Fuel and purchased power — utility	1,531		1,386		1,387
Utility Margin	4,278		4,120		3,837
Operating Revenues — Non-utility operations	12		14		5
Operation and maintenance	1,556		1,489		1,434
Depreciation and amortization	1,122		1,057		949
Taxes other than income	321		297		311
Asset (gains) losses and impairments, net	1		41		13
Operating Income	1,290		1,250		1,135
Other (Income) and Deductions	322		365		284
Income Tax Expense	104		108		137
Net Income Attributable to DTE Energy Company	$	864	$	777	$	714

See DTE Electric's Consolidated Statements of Operations in Item 8 of this Report for a complete view of its results. Differences between the Electric segment and DTE Electric's Consolidated Statements of Operations are primarily due to non-utility operations at DTE Sustainable Generation and the classification of certain benefit costs. Refer to Note 20 to the Consolidated Financial Statements, "Retirement Benefits and Trusteed Assets" for additional information.

Utility Margin increased $158 million in 2021 and $283 million in 2020. Revenues associated with certain mechanisms and surcharges are offset by related expenses elsewhere in the Registrants' Consolidated Statements of Operations.

The following table details changes in various Utility Margin components relative to the comparable prior period:


	2021		2020
	(In millions)
Implementation of new rates	$	71	$	215
Regulatory mechanism — EWR	61		18
Regulatory mechanism — RPS	57		19
Weather	14		8
Base sales / rate mix	13		52
Regulatory mechanism — TRM	6		(12)
Voluntary refunds(a)	(60)		(30)
Other regulatory mechanisms and other	(4)		13
Increase in Utility Margin	$	158	$	283

______________________________

(a)Variances reflect the $90 million voluntary refund recognized in 2021 for the incremental tree trim surge and the $30 million COVID-19 voluntary refund recognized in 2020. Refer to Note 9 to the Consolidated Financial Statements, "Regulatory Matters," for additional information regarding these refunds and the related regulatory liabilities.


	2021	2020	2019
	(In thousands of MWh)
DTE Electric Sales
Residential	16,386	16,315	15,066
Commercial	16,393	15,648	16,955
Industrial	8,487	8,446	9,826
Other	216	220	226
	41,482	40,629	42,073
Interconnection sales(a)	4,263	1,808	3,046
Total DTE Electric Sales	45,745	42,437	45,119

DTE Electric Deliveries
Retail and wholesale	41,482	40,629	42,073
Electric retail access, including self-generators(b)	4,357	3,746	4,550
Total DTE Electric Sales and Deliveries	45,839	44,375	46,623

(a)Represents power that is not distributed by DTE Electric.

(b)Represents deliveries for self-generators that have purchased power from alternative energy suppliers to supplement their power requirements.

DTE Electric sales volumes increased in 2021, primarily attributable to commercial customers which were impacted more significantly in 2020 by the COVID-19 pandemic and temporary shut-downs of certain commercial operations.

Operating Revenues — Non-utility operations decreased $2 million in 2021 and increased $9 million in 2020. The decrease in 2021 was primarily due to lower sales volumes at DTE Sustainable Generation. The increase in 2020 was due to renewable energy projects acquired in January 2020.

Operation and maintenance expense increased $67 million in 2021 and $55 million in 2020. The increase in 2021 was primarily due to higher EWR expense of $45 million, higher distribution operations expense of $42 million (primarily due to higher storm costs), higher corporate support costs of $21 million, higher legal and environmental expense of $15 million, and higher benefits expense of $13 million. These increases were partially offset by lower COVID-19 related expenses of $43 million, lower uncollectible expense of $26 million, and lower plant generation expense of $4 million.

The increase in 2020 was primarily due to COVID-19 related expenses of $50 million, higher benefits expense of $15 million, higher EWR expense of $11 million, higher RPS expenses of $9 million, and an $11 million adjustment in 2019 to defer expenses previously accrued for a new customer billing system. These increases were partially offset by lower plant generation expense of $25 million and lower distribution operations expense of $12 million.

Depreciation and amortization expense increased $65 million in 2021 and $108 million in 2020. In 2021, the increase was primarily due to a $64 million increase resulting from a higher depreciable base. In 2020, the increase was primarily due to a $108 million increase resulting from a higher depreciable base and change in depreciation rates effective May 2019 and a $10 million increase resulting from new non-utility assets at DTE Sustainable Generation, partially offset by a decrease of $11 million associated with the TRM.

Taxes other than income increased $24 million in 2021 and decreased $14 million in 2020. In 2021, the increase was primarily due to higher property taxes of $22 million as a result of an increase in tax base and a favorable property tax settlement in 2020. In 2020, the decrease was primarily due to lower property taxes of $9 million as a result of a property tax settlement, partially offset by an increase in tax base. The decrease in 2020 was also due to lower payroll taxes of $3 million, which was primarily attributable to employee retention credits recognized pursuant to the CARES Act.

Asset (gains) losses and impairments, net decreased $40 million in 2021 and increased $28 million in 2020. The decrease in 2021 was primarily due to lower activity in the current year compared to a $41 million write-off of capital expenditures related to incentive compensation in 2020. The increase in 2020 was primarily due to the $41 million write-off of capital expenditures, which were disallowed in the May 8, 2020 rate order from the MPSC, compared to losses of $13 million in 2019.

Other (Income) and Deductions decreased $43 million in 2021 and increased $81 million in 2020. The decrease in 2021 was primarily due to lower contributions to the DTE Energy Foundation and other not-for-profit organizations of $28 million, a change in rabbi trust investment earnings (net gain of $7 million in 2021 compared to a net loss of $3 million in 2020), and lower non-operating retirement benefits expense of $4 million. The increase in 2020 was primarily due to a change in rabbi trust investment earnings (net loss of $3 million in 2020 compared to a gain of $37 million in 2019), $30 million of contributions to the DTE Energy Foundation and other not-for-profit organizations, and $22 million of higher interest expense. These increases were partially offset by a 2019 accrual of $6 million associated with an environmental-related settlement.

Income Tax Expense decreased $4 million in 2021 and $29 million in 2020. The decrease in both 2021 and 2020 was primarily due to higher amortization of the TCJA regulatory liability and higher production tax credits, partially offset by higher earnings.

Outlook— DTE Electric will continue to move forward in its efforts to achieve operational excellence, sustain strong cash flows, and earn its authorized return on equity. DTE Electric expects that planned significant capital investments will result in earnings growth. DTE Electric will maintain a strong focus on customers by increasing reliability and satisfaction while keeping customer rate increases affordable. Looking forward, additional factors may impact earnings such as weather, the outcome of regulatory proceedings, benefit plan design changes, investment returns and changes in discount rate assumptions in benefit plans and health care costs, uncertainty of legislative or regulatory actions regarding climate change, and effects of energy waste reduction programs.

On March 26, 2021, DTE Electric filed an application requesting a financing order approving the securitization financing of $184 million of qualified costs related to the net book value of the River Rouge generation plant and tree trimming surge program costs. The filing requested recovery of these qualifying costs from DTE Electric's customers. A final MPSC financing order was issued on June 23, 2021 authorizing DTE Electric to proceed with the issuance of securitization bonds for qualified costs of up to $236 million, increased for the inclusion of deferred taxes. The financing order further authorized customer charges for the timely recovery of the debt service costs on the securitization bonds and other ongoing qualified costs. Securitization financing is expected to occur in March 2022.

DTE Electric filed a rate case with the MPSC on January 21, 2022 requesting an increase in base rates of $388 million based on a projected twelve-month period ending October 31, 2023. The requested increase in base rates is primarily due to an increase in net plant resulting from generation and distribution investments, as well as related increases to depreciation and property tax expenses. The rate filing also requests an increase in return on equity from 9.9% to 10.25% and includes projected changes in sales. A final MPSC order in this case is expected in November 2022. Refer to Note 9 to the Consolidated Financial Statements, "Regulatory Matters", for additional information.

GAS

The Gas segment consists principally of DTE Gas. Gas results and outlook are discussed below:


	2021		2020		2019
	(In millions)
Operating Revenues — Utility operations	$	1,553	$	1,414	$	1,482
Cost of gas — utility	422		356		427
Utility Margin	1,131		1,058		1,055
Operation and maintenance	521		496		515
Depreciation and amortization	177		157		144
Taxes other than income	93		84		80
Asset (gains) losses and impairments, net	4		14		—
Operating Income	336		307		316
Other (Income) and Deductions	84		73		69
Income Tax Expense	38		48		62
Net Income Attributable to DTE Energy Company	$	214	$	186	$	185

Utility Margin increased $73 million in 2021 and $3 million in 2020. Revenues associated with certain mechanisms and surcharges are offset by related expenses elsewhere in DTE Energy's Consolidated Statements of Operations.

The following table details changes in various Utility Margin components relative to the comparable prior period:


	2021		2020
	(In millions)
Implementation of new rates	$	75	$	32
Home protection program	6		4
Regulatory mechanism — EWR	3		9
TCJA rate reduction liability	—		(9)
Weather	(7)		(46)
Infrastructure recovery mechanism	(15)		17


Other regulatory mechanisms and other	11		(4)
Increase in Utility Margin	$	73	$	3


	2021	2020	2019
	(In Bcf)
Gas Markets
Gas sales	128	126	139
End-user transportation	165	180	185
	293	306	324
Intermediate transportation	488	477	497
Total Gas sales	781	783	821

The change in sales in 2021 was primarily due to a decrease in End-user transportation volumes, including lower generation needs at certain industrial customers. The decrease in sales in 2020 was primarily due to more unfavorable weather compared to 2019. Intermediate transportation volumes fluctuate period to period based on available market opportunities.

Operation and maintenance expense increased $25 million in 2021 and decreased $19 million in 2020. The increase in 2021 was primarily due to higher gas operations expense of $41 million, partially offset by lower uncollectible expense of $15 million. The decrease in 2020 was primarily due to lower gas operations expense of $36 million, partially offset by higher EWR expense of $7 million, higher corporate overhead costs of $3 million, and a $6 million adjustment in 2019 to defer expenses previously accrued for a new customer billing system.

Depreciation and amortization expense increased $20 million in 2021 and $13 million in 2020. The increase in both periods was primarily due to a higher depreciable base and change in depreciation rates effective October 2020.

Taxes other than income increased$9 million in 2021 and $4 million in 2020. The 2021 increase was primarily due to higher property taxes of $6 million and employee retention credits of $3 million recognized in 2020 pursuant to the CARES Act. The 2020 increase was primarily due to higher property taxes of $8 million, partially offset by the employee retention credits of $3 million.

Asset (gains) losses and impairments, net decreased$10 million in 2021 and increased $14 million in 2020. The decrease in 2021 was due to lower activity in the current year, including $4 million of capital write-offs, compared to a $14 million write-off of capital expenditures related to incentive compensation in 2020. The increase in 2020 was primarily due to the $14 million write-off of capital expenditures, which were disallowed in the July 17, 2020 rate case settlement.

Other (Income) and Deductions increased $11 million in 2021 and $4 million in 2020. The increase in 2021 was primarily due to contributions to the DTE Energy Foundation and other not-for-profit organizations. The increase in 2020 was primarily due to lower investment earnings of $2 million and higher interest expense of $2 million.

Income Tax Expense decreased $10 million in 2021 and $14 million in 2020. The decrease in 2021 was primarily due to higher amortization of the TCJA regulatory liability, partially offset by higher earnings. The decrease in 2020 was primarily due to higher amortization of the TCJA regulatory liability and lower earnings.

Outlook — DTE Gas will continue to move forward in its efforts to achieve operational excellence, sustain strong cash flows, and earn its authorized return on equity. DTE Gas expects that planned significant infrastructure capital investments will result in earnings growth. Looking forward, additional factors may impact earnings such as weather, the outcome of regulatory proceedings, benefit plan design changes, and investment returns and changes in discount rate assumptions in benefit plans and health care costs. DTE Gas expects to continue its efforts to improve productivity and decrease costs while improving customer satisfaction with consideration of customer rate affordability.

DTE VANTAGE

The DTE Vantage segment is comprised primarily of projects that deliver energy and utility-type products and services to industrial, commercial, and institutional customers, produce reduced emissions fuel, and sell electricity and pipeline-quality gas from renewable energy projects. DTE Vantage results and outlook are discussed below:


	2021		2020		2019
	(In millions)
Operating Revenues — Non-utility operations	$	1,482	$	1,224	$	1,560
Fuel, purchased power, and gas — non-utility	1,086		901		1,220
Non-utility Margin	396		323		340
Operation and maintenance	301		294		328
Depreciation and amortization	71		72		69
Taxes other than income	11		10		11
Asset (gains) losses and impairments, net	28		(18)		1
Operating Loss	(15)		(35)		(69)
Other (Income) and Deductions	(142)		(120)		(126)
Income Taxes
Expense	37		26		20
Production Tax Credits	(68)		(66)		(83)
	(31)		(40)		(63)
Net Income	158		125		120
Less: Net Loss Attributable to Noncontrolling Interests	(10)		(9)		(13)
Net Income Attributable to DTE Energy Company	$	168	$	134	$	133

Operating Revenues — Non-utility operations increased $258 million in 2021 and decreased $336 million in 2020. The changes are due to the following:


	2021
	(In millions)
Higher production partially offset by the sale of membership interests in the REF business	$	175
Higher demand partially offset by lower prices in the Steel business	104
New projects in the Renewables business	42
Recognition of revenues from termination of a contract in the Steel business	17
Higher volumes partially offset by a terminated contract in the On-site business	15
Closed projects in the Renewables business	(7)
Site closures in the REF business	(88)
	$	258


	2020
	(In millions)
Sale of membership interests and project terminations in the REF business	$	(234)
Lower demand in the Steel business	(142)
Expired contract in the Renewables business	(21)
New projects and higher production in the Renewables business	30
New projects in the On-site business	31
	$	(336)

Non-utility Margin increased $73 million in 2021 and decreased $17 million in 2020. The changes are due to the following:


	2021
	(In millions)
New projects in the Renewables business	$	42
Higher demand partially offset by lower prices in the Steel business	18
Recognition of revenues from termination of a contract in the Steel business	17
Closed projects in the Renewables business	(6)
Other	2
	$	73


	2020
	(In millions)
Lower demand in the Steel business	$	(50)
Expired contracts in the Renewables business	(18)
New projects in the On-site business	22
New projects and higher production in the Renewables business	27
Other	2
	$	(17)

Operation and maintenance expense increased $7 million in 2021 and decreased $34 million in 2020. The 2021 increase was primarily due to higher production and new projects, partially offset by closed projects. The 2020 decrease was primarily due to $46 million of lower maintenance spending associated with lower production and terminated contracts, partially offset by $12 million of costs associated with new projects.

Asset (gains) losses and impairments, net changed by $46 million in 2021 from the net gain of $18 million in 2020, and changed by $19 million in 2020 from the net loss of $1 million in 2019. The change in 2021 was primarily due to an asset impairment of $27 million recorded in the Steel business for the closure of a pulverized coal facility and $17 million of activity in 2020. Refer to Note 4 to the Consolidated Financial Statements, "Dispositions and Impairments," for additional information regarding the $27 million asset impairment.

The change in 2020 was primarily due to to $11 million in the Steel business for an asset sale and write-off of environmental liabilities upon completing site remediation, $4 million for the sale of assets in the On-site business, and $2 million for the divestiture of a project in the Renewables business.

Other (Income) and Deductions increased $22 million in 2021 and decreased $6 million in 2020. The 2021 increase was primarily due to a $22 million settlement charge associated with a qualified pension plan in the Steel business recorded in 2020. The 2021 increase also included higher production in the REF business, offset by profit recognized from the sale of membership interests recorded in 2020.

The 2020 decrease was primarily due to the $22 million settlement charge in the Steel business and a change in insurance proceeds in the REF and Renewables businesses ($7 million received in 2019). This decrease was partially offset by $12 million of higher interest income associated with lease transactions in the On-site business and $11 million of profit recognized from the sale of membership interests in the REF business.

Income Taxes — Production Tax Credits increased by $2 million in 2021 and decreased by $17 million in 2020. The increase in 2021 was primarily due to higher production partially offset by the sale of membership interests in the REF business. The decrease in 2020 was primarily due to the sale of membership interests in the REF business.

Net Loss Attributable to Noncontrolling Interests increased by $1 million in 2021 and decreased by $4 million in 2020. The 2020 decrease was primarily due to lower production in the REF business.

Outlook — DTE Vantage will continue to leverage its extensive energy-related operating experience and project management capability to develop additional energy and renewable natural gas projects to serve energy intensive industrial customers. Beginning in 2022, DTE Vantage expects decreases in Other Income and Production Tax Credits that will cause a corresponding reduction to Net Income as REF facilities will have ceased operations. Over the long-term, DTE Vantage expects that growth in renewable energy and industrial energy services projects will offset the decreases to Net Income caused by the REF phase-out. DTE Vantage is also exploring decarbonization opportunities relating to carbon capture and storage projects.

ENERGY TRADING

Energy Trading focuses on physical and financial power, natural gas and environmental marketing and trading, structured transactions, enhancement of returns from its asset portfolio, and optimization of contracted natural gas pipeline transportation and storage positions. Energy Trading also provides natural gas, power, environmental and related services, which may include the management of associated storage and transportation contracts on the customers' behalf and the supply or purchase of ~~renewable energy credits~~environmental attributes to various customers. Energy Trading results and outlook are discussed below:


	2021		2020		2019
	(In millions)
Operating Revenues — Non-utility operations	$	6,831	$	3,863	$	4,610
Purchased power and gas — non-utility	6,825		3,725		4,455
Non-utility Margin	6		138		155
Operation and maintenance	81		77		75
Depreciation and amortization	6		5		6
Taxes other than income	5		4		4
Operating Income (Loss)	(86)		52		70
Other (Income) and Deductions	24		4		4
Income Tax Expense (Benefit)	(27)		12		17
Net Income (Loss) Attributable to DTE Energy Company	$	(83)	$	36	$	49

2018 2017 2016
(In millions)
Operating Revenues — Non-utility operations $ 5,557
$ 4,277
$ 2,575
Purchased power and gas — non-utility 5,417
4,077
2,552
Non-utility Margin 140
200
23
Operation and maintenance 75
68
63
Depreciation and amortization 5
5
3
Taxes other than income 5
4
2
Operating Income (Loss) 55
123
(45 )
Other (Income) and Deductions 3
2
29
Income Tax Expense (Benefit) 13
49
(29 )
Net Income (Loss) Attributable to DTE Energy Company $ 39
$ 72
$ (45 )

Operating Revenues — Non-utility operations and Purchased power and gas — non-utility ~~were impacted~~ increased in 2021 primarily ~~by an increase in volumes as well as an increase in~~due to significantly higher gas prices ~~for~~in the ~~years ended December 31, 2018~~gas structured and ~~December 31, 2017,~~gas transportation strategies and decreased in 2020 primarily due to lower gas prices, primarily in the gas structured strategy.

Non-utility Margin decreased ~~$60~~by $132 million in ~~2018~~2021 and ~~increased $177~~$17 million in ~~2017.~~2020. The change in both periods was primarily due to timing from the unrealized and realized margins presented in the following tables:

2018
(In millions)
Unrealized Margins^(a)

Favorable results, primarily in the power trading strategy $ 20
Unfavorable results, primarily in gas structured, and power full requirements strategies^(b)
(100 )
(80 )
Realized Margins^(a)

Favorable results, primarily in the gas structured strategy 54
Unfavorable results, primarily in the power full requirements strategy^(c)
(34 )
20
Decrease in Non-utility Margin $ (60 )


~~(a)~~	~~Natural~~2021
	(In millions)
Unrealized Margins(a)
Favorable results, primarily in gas and power trading strategies	$	36
Unfavorable results, primarily in gas structured, ~~transactions typically involve a physical purchase or sale of natural~~environmental trading, and gas storage strategies (b)	(215)
	(179)
Realized Margins(a)
Favorable results, primarily in ~~the future and/or natural gas basis financial instruments which are derivatives and a related non-derivative pipeline transportation contract. These~~ gas structured ~~transactions can result~~and gas transportation strategies(c)	126
Unfavorable results, primarily in ~~significant earnings volatility as the derivative components are marked-to-market without revaluing the related non-derivative contracts.~~power ERCOT trading and power full requirements strategies	(79)
	47
Decrease in Non-utility Margin	$	(132)

DTE ~~Energy's Cash and cash equivalents as well as Restricted cash reported within the~~Energy Company — DTE Electric Company

Combined Notes to Consolidated Financial Statements ~~of Financial Position that sum to the total of the same such amounts shown in the Consolidated Statements of Cash Flows:~~

— (Continued)

2018 2017
(In millions)
Cash and cash equivalents $ 71
$ 66
Restricted cash 5
23
Total cash, cash equivalents, and restricted cash shown in the Consolidated Statements of Cash Flows $ 76
$ 89

Financing Receivables

~~Accounts receivable~~Financing receivables are primarily composed of trade receivables, notes receivable, and unbilled revenue. The Registrants' ~~Accounts receivable~~financing receivables are stated at net realizable value.

DTE Energy had unbilled revenues of $1.0 billion and $0.8 billion at December 31, 2021 and 2020, respectively, including $270 million and $260 million of DTE Electric unbilled revenues, respectively, included in Customer Accounts receivable.

The Registrants monitor the credit quality of their financing receivables on a regular basis by reviewing credit quality indicators and monitoring for trigger events, such as a credit rating downgrade or bankruptcy. Credit quality indicators include, but are not limited to, ratings by credit agencies where available, collection history, collateral, counterparty financial statements and other internal metrics. Utilizing such data, the Registrants have determined three internal grades of credit quality. Internal grade 1 includes financing receivables for counterparties where credit rating agencies have ranked the counterparty as investment grade. To the extent credit ratings are not available, the Registrants utilize other credit quality indicators to determine the level of risk associated with the financing receivable. Internal grade 1 may include financing receivables for counterparties for which credit rating agencies have ranked the counterparty as below investment grade; however, due to favorable information on other credit quality indicators, the Registrants have determined the risk level to be similar to that of an investment grade counterparty. Internal grade 2 includes financing receivables for counterparties with limited credit information and those with a higher risk profile based upon credit quality indicators. Internal grade 3 reflects financing receivables for which the counterparties have the greatest level of risk, including those in bankruptcy status.

The following represents the Registrants' financing receivables by year of origination, classified by internal grade of credit risk. The related credit quality indicators and risk ratings utilized to develop the internal grades have been updated through December 31, 2021.


	DTE Energy								DTE Electric
	Year of origination
	2021		2020		2019 and prior		Total		2021 and prior
	(In millions)
Notes receivable
Internal grade 1	$	—	$	—	$	21	$	21	$	14
Internal grade 2	16		107		6		129		3

Total notes receivable(a)	$	16	$	107	$	27	$	150	$	17

Net investment in leases
Net investment in leases, internal grade 1	$	—	$	1	$	38	$	39	$	—
Net investment in leases, internal grade 2	—		159		1		160		—
Total net investment in leases(a)	$	—	$	160	$	39	$	199	$	—

(a)For DTE Energy, included in Current Assets — Other and Other Assets — Notes Receivable on the Consolidated Statements of Financial Position. For DTE Electric, included in Current Assets — Other on the Consolidated Statements of Financial Position.

The allowance for doubtful accounts on accounts receivable for ~~DTE Electric and DTE Gas~~the utility entities is generally calculated using ~~the~~an aging approach that utilizes rates developed in reserve studies. DTE Electric and DTE Gas establish an allowance for uncollectible accounts based on historical losses and ~~management’s~~management's assessment of existing and future economic conditions, customer trends and other factors. Customer accounts are generally considered delinquent if the amount billed is not received by the due date, which is typically in 21 days, however, factors such as assistance programs may delay aggressive action. DTE Electric and DTE Gas generally assess late payment fees on trade receivables based on past-due terms with customers. Customer accounts are written off when collection efforts have been exhausted. The time period for write-off is 150 days after service has been terminated.

The customer allowance for doubtful accounts for ~~DTE Energy's~~non-utility businesses and other receivables for both utility and non-utility businesses is generally calculated based on specific review of probable future collections based on receivable balances generally in excess of 30 days. Existing and future economic conditions, customer trends and other factors are also considered. Receivables are written off on a specific identification basis and determined based upon the specific circumstances of the associated receivable.

DTE Energy ~~unbilled revenues of $1.0 billion at December 31, 2018 and 2017 include $264 million and $290 million of~~Company — DTE Electric ~~unbilled revenues, respectively, included in Customer Accounts receivable.~~Company

Combined Notes ~~Receivable~~to Consolidated Financial Statements — (Continued)

Notes receivable ~~or financing receivables,~~ for DTE Energy are primarily comprised of ~~capital~~finance lease receivables and loans ~~and~~that are included in Notes ~~receivable~~Receivable and Other current assets on DTE ~~Energy’s~~Energy's Consolidated Statements of Financial Position. Notes receivable ~~or financing receivables,~~ for DTE Electric are primarily comprised of loans.

Notes receivable are typically considered delinquent when payment is not received for periods ranging from 60 to 120 days. The Registrants cease accruing interest (nonaccrual status), consider a note receivable impaired, and establish an allowance for credit loss when it is probable that all principal and interest amounts due will not be collected in accordance with the contractual terms of the note receivable. Cash payments received on nonaccrual status notes receivable, that do not bring the account contractually current, are first applied to contractually owed past due interest, with any remainder applied to principal. Accrual of interest is generally resumed when the note receivable becomes contractually current.

In determining the allowance for credit losses for notes receivable, the Registrants consider the historical payment experience and other factors that are expected to have a specific impact on the ~~counterparty’s~~counterparty's ability to ~~pay. In addition,~~pay including existing and future economic conditions.

Cash payments received on nonaccrual status notes receivable, that do not bring the account contractually current, are first applied to the contractually owed past due interest, with any remainder applied to principal. Accrual of interest is generally resumed when the note receivable becomes contractually current.

The following tables present a roll-forward of the activity for the Registrants' financing receivables credit loss reserves:


	DTE Energy				DTE Electric
	Trade accounts receivable		Other receivables			Total		Trade and other accounts receivable
	(In millions)
Beginning reserve balance, January 1, 2021	$	101	$	3		$	104	$	57
Current period provision	53		1			54		36

Write-offs charged against allowance	(126)		(1)			(127)		(77)
Recoveries of amounts previously written off	61		—			61		38
Ending reserve balance, December 31, 2021	$	89	$	3		$	92	$	54


	DTE Energy				DTE Electric
	Trade accounts receivable		Other receivables			Total		Trade and other accounts receivable
	(In millions)
Beginning reserve balance, January 1, 2020(a)	$	79	$	4		$	83	$	46
Current period provision	102		3			105		61

Write-offs charged against allowance	(130)		(4)			(134)		(80)
Recoveries of amounts previously written off	50		—			50		30
Ending reserve balance, December 31, 2020	$	101	$	3		$	104	$	57

(a)DTE Energy Trade accounts receivable beginning reserve balance excludes $8 million related to the discontinued operations of DT Midstream. Prospective activity includes only the continuing operations of DTE Energy.

Uncollectible expense for the Registrants ~~monitor the credit ratings~~is primarily comprised of the ~~counterparties from which they have notes receivable.~~current period provision for allowance for doubtful accounts and is summarized as follows:

~~Inventories~~


	Year Ended December 31,
	2021		2020		2019
	(In millions)
DTE Energy	$	55	$	105	$	106
DTE Electric	$	36	$	62	$	65

~~Inventory related to utility operations is generally valued at average cost. Inventory related to non-utility operations is valued at~~There are no material amounts of past due financing receivables for the ~~lower~~Registrants as of ~~cost or net realizable value.~~December 31, 2021.

DTE Energy Company — DTE Electric Company

Combined Notes to Consolidated Financial Statements — (Continued)

Inventories

Inventory related to utility and non-utility operations is valued at the lower of cost or net realizable value, where cost is generally valued using average cost. Inventory primarily includes fuel, gas, materials, and supplies. Other inventories include RECs, emission allowances, and other environmental products in the Energy Trading segment.

DTE Gas' natural gas inventory of ~~$48~~$50 million and ~~$29~~$40 million as of December 31, ~~2018~~2021 and ~~2017,~~2020, respectively, is determined using the last-in, first-out (LIFO) method. The replacement cost of gas in inventory exceeded the LIFO cost by ~~$113~~$136 million and ~~$81~~$62 million at December 31, ~~2018~~2021 and ~~2017,~~2020, respectively.

Property, Retirement and Maintenance, and Depreciation and Amortization

Property is stated at cost and includes construction-related labor, materials, overheads, and AFUDC for utility property. The cost of utility properties retired is charged to accumulated depreciation. Expenditures for maintenance and repairs are charged to expense when ~~incurred, except for outage-related maintenance repairs for Fermi 2.~~incurred.

Utility property at DTE Electric and DTE Gas is depreciated over its estimated useful life using straight-line rates approved by the MPSC.

DTE Energy's non-utility property is depreciated over its estimated useful life using the straight-line method.

Depreciation and amortization expense also includes the amortization of certain regulatory assets for the Registrants.

Approximately $4 million and $15 million of expenses related to Fermi 2 refueling outages were accrued at December 31, 2018 and 2017, respectively. Amounts are accrued on a pro-rata basis, generally over an 18-month period, that coincides with scheduled refueling outages at Fermi 2. This accrual of outage costs matches the regulatory recovery of these costs in rates set by the MPSC. See Note 9 to the Consolidated Financial Statements, "Regulatory Matters."

The cost of nuclear fuel is capitalized. The amortization of nuclear fuel is included within Fuel, purchased power, and gas — utility in the DTE Energy Consolidated Statements of Operations, and Fuel and purchased power in the DTE Electric Consolidated Statements of Operations, and is recorded using the units-of-production method.

See Note 6 to the Consolidated Financial Statements, "Property, Plant, and Equipment."

Long-Lived Assets

Long-lived assets are reviewed for impairment whenever events or changes in circumstances indicate the carrying amount of an asset may not be recoverable. If the carrying amount of the asset exceeds the expected undiscounted future cash flows generated by the asset, an impairment loss is recognized resulting in the asset being written down to its estimated fair value. Assets to be disposed of are reported at the lower of the carrying amount or fair value, less costs to sell.

~~DTE Energy Company — DTE Electric Company~~

~~Combined Notes to Consolidated Financial Statements — (Continued)~~

Intangible Assets

The Registrants have certain Intangible assets as shown below:

December 31, 2018 December 31, 2017
Useful Lives Gross Carrying Value Accumulated Amortization Net Carrying Value Gross Carrying Value Accumulated Amortization Net Carrying Value
(In millions)
Intangible assets subject to amortization
Customer relationships
25 - 40 years^(a)
$ 779
$ (44 ) $ 735
$ 770
$ (24 ) $ 746
Contract intangibles 6 to 26 years 159
(66 ) 93
168
(72 ) 96
938
(110 ) 828
938
(96 ) 842

DTE Electric renewable energy credits (b) 20
—
20
24
—
24
DTE Electric emission allowances (b) 1
—
1
1
—
1
21
—
21
25
—
25
Long-term intangible assets
DTE Electric $ 21
$ —
$ 21
$ 25
$ —
$ 25
DTE Energy $ 959
$ (110 ) $ 849
$ 963
$ (96 ) $ 867


		December 31, 2021						December 31, 2020
	Useful Lives	Gross Carrying Value		Accumulated Amortization		Net Carrying Value		Gross Carrying Value		Accumulated Amortization		Net Carrying Value
		(In millions)
Intangible assets subject to amortization

Contract intangibles	6 to 26 years	$	271	$	(98)	$	173	$	271	$	(83)	$	188






Intangible assets not subject to amortization(a)		4		—		4		11		—		11

DTE Energy Long-term intangible assets		$	275	$	(98)	$	177	$	282	$	(83)	$	199


~~(a)~~	The useful life of the customer relationship intangible assets is based on the number of years in which the assets are expected to economically contribute to the business. The expected economic benefit incorporates existing customer contracts and expected renewal rates based on the estimated volume and production lives of gas resources in the region.


~~(b)~~	~~Emission allowances and renewable energy credits are charged to expense, using average cost, as the allowances and credits are consumed in the operation of the business.~~

(a)Amounts primarily include Renewable energy credits and Gas carbon offsets that are charged to expense, using average cost, as the credits are consumed in the operation of the business. Amounts include DTE Electric intangible assets of $2 million and $11 million as of December 31, 2021 and 2020, respectively, and are included in Other Assets — Other on the DTE Electric Consolidated Statements of Financial Position.

The following table summarizes DTE Energy's estimated ~~customer relationship and~~ contract intangible amortization expense expected to be recognized during each year through ~~2023:~~2026:


	2022		2023		2024		2025		2026
	(In millions)
Estimated amortization expense	$	16	$	16	$	16	$	16	$	14

2019 2020 2021 2022 2023
(In millions)
Estimated amortization expense $ 27
$ 26
$ 25
$ 25
$ 25

DTE Energy Company — DTE Electric Company

Combined Notes to Consolidated Financial Statements — (Continued)

DTE Energy amortizes ~~customer relationship and~~ contract intangible assets on a straight-line basis over the expected period of benefit. DTE Energy's Intangible assets amortization expense was ~~$27 million in 2018, $29 million in 2017, and~~ $16 million in ~~2016.~~2021 and 2020 and $9 million in 2019.

Cloud Computing Arrangements

Effective upon the adoption of ASU No. 2018-15 in January 2020, the Registrants capitalize implementation costs incurred in a cloud computing arrangement that is a service contract consistent with capitalized implementation costs incurred to develop or obtain internal-use software. Capitalized costs are recorded in Other noncurrent assets on the Consolidated Statements of Financial Position and amortization of the costs is reflected in Operation and maintenance within the Consolidated Statements of Operations. Costs are amortized on a straight-line basis over the life of the contract. Contracts primarily involve the implementation or upgrade of cloud-based solutions for generation and distribution operations and customer service support.

Capitalized cloud computing costs were $16 million for DTE Energy, including $12 million for DTE Electric, at December 31, 2021. Amortization of these costs was not material for the year ended December 31, 2021. There were no cloud computing costs capitalized in Other noncurrent assets at December 31, 2020.

Excise and Sales Taxes

The Registrants record the billing of excise and sales taxes as a receivable with an offsetting payable to the applicable taxing authority, with no net impact on the Registrants’ Consolidated Statements of Operations.

Deferred Debt Costs

The costs related to the issuance of long-term debt are deferred and amortized over the life of each debt issue. The deferred amounts are included as a direct deduction from the carrying amount of each debt issue in Mortgage bonds, notes, and other and Junior subordinated debentures on DTE Energy's Consolidated Statements of Financial Position and in Mortgage bonds, notes, and other on DTE Electric's Consolidated Statements of Financial Position. In accordance with MPSC regulations applicable to DTE Energy’s electric and gas utilities, the unamortized discount, premium, and expense related to utility debt redeemed with a refinancing are amortized over the life of the replacement issue. ~~Discount, premium,~~Discounts, premiums, and expense on early redemptions of debt associated with DTE Energy's non-utility operations are charged to earnings.

~~DTE Energy Company — DTE Electric Company~~

~~Combined Notes to Consolidated Financial Statements — (Continued)~~

Investments in Debt and Equity Securities

The Registrants generally record investments in debt and equity securities at market value with unrealized gains or losses included in earnings. Changes in the fair value of Fermi 2 nuclear decommissioning investments are recorded as adjustments to Regulatory assets or liabilities, due to a recovery mechanism from customers. The Registrants' equity investments are reviewed for impairment each reporting period. If the assessment indicates that an impairment exists, a loss is recognized resulting in the equity investment being written down to its estimated fair value. See Note 12 of the Consolidated Financial Statements, "Fair Value."

DTE Energy Foundation

DTE Energy's ~~charitable~~ contributions to the DTE Energy Foundation were ~~$22 million, $43~~$25 million and ~~$26~~$20 million for the years ended December 31, ~~2018, 2017,~~2021 and ~~2016,~~December 31, 2020, respectively. There were no charitable contributions made to the DTE Energy Foundation for the year ended December 31, 2019. The DTE Energy Foundation is a non-consolidated not-for-profit private foundation, the purpose of which is to contribute to and assist charitable organizations.

DTE Energy Company — DTE Electric Company

Combined Notes to Consolidated Financial Statements — (Continued)

Other Accounting Policies

See the following notes for other accounting policies impacting the Registrants’ Consolidated Financial Statements:



Note						Title
45						Revenue
86						Property, Plant, and Equipment
8						Asset Retirement Obligations
9						Regulatory Matters
10						Income Taxes
12						Fair Value
13						Financial and Other Derivative Instruments
2017						Leases
20						Retirement Benefits and Trusteed Assets
21						Stock-Based Compensation

NOTE 3 — NEW ACCOUNTING PRONOUNCEMENTS

Recently Adopted Pronouncements

In ~~May 2014,~~December 2019, the FASB issued ASU No. ~~2014-09,~~ ~~Revenue from Contracts with Customers~~2019-12, Income Taxes (Topic ~~606),~~ ~~as amended~~740) - Simplifying the Accounting for Income Taxes. The ~~objectives of~~amendments in this ~~ASU are to improve upon revenue recognition~~update simplify the accounting for income taxes by removing certain exceptions, and clarifying certain requirements ~~by providing a single comprehensive model to determine the measurement of revenue~~regarding franchise taxes, goodwill, consolidated tax expenses, and timing of recognition. The core principle is that an entity will recognize revenue to depict the transfer of goods or services to customers at an amount that the entity expects to be entitled to in exchange for those goods or services. This ASU also required expanded qualitative and quantitative disclosures regarding the nature, amount, timing, and uncertainty of revenues and cash flows arising from contracts with customers. The standard is to be applied using either a full retrospective or modified retrospective approach.annual effective tax rate calculations. The Registrants adopted the ~~standard~~ASU effective January 1, ~~2018,~~2021 using the modified retrospective ~~approach. Under the modified retrospective approach, the information for periods prior to the adoption date has not been restated~~ and continues to be reported under the accounting standards in effect for those periods. As permitted under the standard, the Registrants have elected to apply the guidance only to those contracts that were not completed at January 1, 2018, and have elected not to restate the impacts of any contract modifications made prior to the earliest period presented.

prospective approaches, where applicable. The adoption of the ASU did not have a significant impact on the Registrants' ~~financial position or results of operations, but required additional disclosures for revenue. See Note 4 to the~~ Consolidated Financial ~~Statements, "Revenue."~~Statements.

~~DTE Energy Company — DTE Electric Company~~

~~Combined Notes to Consolidated Financial Statements — (Continued)~~

In March ~~2017,~~2020, the FASB issued ASU No. ~~2017-07,~~ ~~Compensation~~ — ~~Retirement Benefits~~2020-04, Reference Rate Reform (Topic ~~715): Improving~~848) - Facilitation of the ~~Presentation~~Effects of ~~Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost.~~ Reference Rate Reform on Financial Reporting, as amended. The amendments in this update ~~required~~provide optional expedients and exceptions for applying GAAP to contract modifications and hedging relationships, subject to meeting certain criteria, that ~~an employer report the service cost component in the same line item~~reference LIBOR or ~~items as other compensation costs arising from services rendered by the pertinent employees during the period. The other components of net benefit cost are required~~another reference rate expected to be ~~presented~~discontinued. The optional relief is temporary and cannot be applied to contract modifications and hedging relationships entered into or evaluated after December 31, 2022. The Registrants adopted the ASU and elected the optional expedients for contract modifications prospectively. The adoption of the ASU did not have a significant impact on the registrant's Consolidated Financial Statements.

In August 2020, the FASB issued ASU No. 2020-06, Debt - Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging - Contracts in ~~the income statement separately from the service cost component~~Entity's Own Equity (Subtopic 815-40): Accounting for Convertible Instruments and ~~outside of income from operations.~~ Contracts in an Entity's Own Equity. The amendments in this update ~~also allow only~~simplify the ~~service cost component~~accounting for certain financial instruments with characteristics of liabilities and equity, including convertible instruments and contracts indexed to ~~be eligible for capitalization when applicable.~~and potentially settled in an entity's own equity. The Registrants adopted the ~~standard~~ASU effective January 1, ~~2018.~~2021 using the modified retrospective approach. The ~~standard has been applied retrospectively for the presentation~~adoption of the ~~service cost component and~~ASU did not have a significant impact on the other components of net periodic pension cost and net periodic postretirement benefit cost in the income statement and prospectively for the capitalization of the service cost component of net periodic pension cost and net periodic postretirement benefit in assets. As permitted by the standard, the Registrants have used benefit cost amounts disclosed for prior periods as the basis for retrospective application in the income statement. As a result of regulatory mechanisms, the impact to theRegistrants' Consolidated Financial ~~Statements was not material for the year ended December 31, 2018.~~Statements.

~~In January 2016, the FASB issued ASU No. 2016-01,~~ ~~Financial Instruments~~ — ~~Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities~~, as amended. The new guidance is intended to improve the recognition and measurement of financial instruments. The guidance primarily impacts accounting for equity investments in unconsolidated entities (other than those accounted for using the equity method of accounting) and financial liabilities under the fair value option. The guidance requires equity investments to be generally measured at fair value, with subsequent changes in fair value recognized in net income. The guidance requires entities to make a cumulative-effect adjustment to the Statements of Financial Position as of the beginning of the first reporting period in which the guidance is effective. The Registrants adopted the standard effective January 1, 2018. Upon adoption, DTE Energy and DTE Electric recorded a cumulative-effect adjustment to reclassify $5 million and $3 million of unrealized gains from Accumulated other comprehensive income (loss) to Retained earnings, respectively.

~~In March 2018, the FASB issued ASU No. 2018-05,~~ ~~Income Taxes (Topic 740): Amendments to SEC paragraphs pursuant to SEC Staff Accounting Bulletin No. 118. The Amendments in this update add various SEC paragraphs pursuant to the issuance of SEC Staff Accounting Bulletin No. 118,~~ ~~Income Tax Accounting Implications of the Tax Cuts and Jobs Act (SAB 118)~~. SAB 118 directs taxpayers to consider the implications of the TCJA as provisional when it does not have the necessary information available, prepared, or analyzed in reasonable detail to complete its accounting for the change in the tax law. As described in Note 10 to the Consolidated Financial Statements, "Income Taxes," within the combined DTE Energy and DTE Electric 2017 Annual Report on Form 10-K and in accordance with SAB 118, the Registrants recorded amounts that were considered provisional. During the year ended December 31, 2018, DTE Energy and DTE Electric finalized their SAB 118 analysis and recorded true-up adjustments to the remeasurement of deferred taxes of $21 million and $7 million, respectively. The impact of the true-up adjustments was an increase in Income Tax Expense, of which $17 million was attributable to the regulated utilities and increased Regulatory liabilities.The true-up adjustments were a result of further analysis for items subject to further consideration at December 31, 2017, under SAB 118 and primarily related to timing differences not recoverable from DTE Electric and DTE Gas customers.

Recently Issued Pronouncements

In ~~February 2016,~~July 2021, the FASB issued ASU No. ~~2016-02,~~ 2021-05, Leases (Topic 842), ~~as amended. This guidance requires~~: Lessors – Certain Leases with Variable Lease Payments. The amendments in this update modify lease classification requirements for lessors, providing that lease contracts with variable lease payments that do not depend on a ~~lessee to account for leases~~reference index or a rate should be classified as ~~finance or~~ operating leases if they would have been classified as a sales-type or direct financing lease and ~~disclose key information about leasing arrangements. Both types of leases will result~~resulted in the ~~lessee recognizing~~recognition of a ~~right-of-use asset~~selling loss at lease commencement. The ASU is effective for the Registrants for fiscal years beginning after December 15, 2021, and a corresponding lease liability on its balance sheet, with differing methodology for income statement recognition, depending on the lease classification. The Registrants will adopt the standard on January 1, 2019. The standard allows lessees and lessors to apply either, 1) a modified retrospective approach for leases existing or entered into after the beginning of the earliest comparative period in the Consolidated Financial Statements, or 2) a prospective transition approach for leases existing as of January 1, 2019 with a cumulative effect adjustment to be recorded to retained earnings.interim periods therein. The Registrants will apply the guidance prospectively. The Registrants are currently assessing the impact of this standard on a prospective basis. The Registrants will elect the package of practical expedients allowing entities to not reassess whether an agreement is a lease, to carryforward the existing lease classification, and to not reassess initial direct costs associated with existing leases. These practical expedients apply to leases that commenced prior to January 1, 2019. The Registrants will also elect to exclude leases from the balance sheet that are for a period of one year or less, as well as, the practical expedient allowing entities to not evaluate land easements under the new guidance at adoption if they were not previously accounted for as leases.their Consolidated Financial Statements.

DTE Energy Company — DTE Electric Company

Combined Notes to Consolidated Financial Statements — (Continued)

~~A third-party software tool has been implemented that will assist with the initial adoption and ongoing compliance of the standard.~~In October 2021, The Registrants are implementing new business processes, internal controls, and accounting policies. The Registrants are in the process of drafting disclosures to satisfy the standard's requirements. In addition, the Registrants are continuing to monitor utility industry implementation guidance and interpretation. While the Registrants expect an increase in assets and liabilities, as well as additional disclosures, they are still assessing the impact of this ASU on their Consolidated Financial Statements.

~~In June 2016, the~~ FASB issued ASU No. ~~2016-13,~~ ~~Financial Instruments — Credit Losses~~2021-08, Business Combinations (Topic ~~326): Measurement of Credit Losses on Financial Instruments~~805), Accounting for Contract Assets and Contract Liabilities from Contracts with Customers. The amendments in this update ~~replace~~require contract assets and contract liabilities acquired in a business combination to be recognized and measured by the ~~incurred loss impairment methodology~~acquirer on the acquisition date in ~~current generally accepted accounting principles~~accordance with ~~a methodology that reflects expected credit losses and requires consideration of a broader range of reasonable and supportable information to inform credit loss estimates. Entities will apply~~ASC 606, Revenue from Contracts with Customers. Historically, such amounts were recognized by the ~~new guidance as a cumulative-effect adjustment to retained earnings as of the beginning of the first reporting period~~acquirer at fair value in which the guidance is adopted. The ASU is effective for the Registrants beginning after December 15, 2019, and interim periods therein. Early adoption is permitted. The Registrants are currently assessing the impact of this standard on their Consolidated Financial Statements.

~~In February 2018, the FASB issued ASU No. 2018-02,~~ ~~Income Statement~~ — ~~Reporting Comprehensive Income (Topic 220): Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income~~. The amendments in this update allow a reclassification from accumulated other comprehensive income to retained earnings for stranded tax effects resulting from the TCJA. The amendments in this update also require entities to disclose their accounting policy for releasing income tax effects from accumulated other comprehensive income.acquisition accounting. The ASU is effective for the Registrants for fiscal years beginning after December 15, ~~2018,~~2022, and interim periods therein. Early adoption is permitted. The Registrants ~~are currently assessing~~will apply the guidance prospectively to acquisitions occurring on or after the effective date.

NOTE 4 — DISPOSITIONS AND IMPAIRMENTS

Separation of DT Midstream

On October 27, 2020, DTE Energy announced that its Board of Directors had authorized management to pursue a plan to spin-off its natural gas pipeline, storage and gathering non-utility business. On July 1, 2021, DTE Energy completed the separation of the new company, DT Midstream, through the distribution of 96,732,466 shares of DT Midstream common stock to DTE Energy shareholders. The distribution reflected 100% of the outstanding common stock of DT Midstream as of 5:00 p.m. ET on June 18, 2021 (the “record date”). DTE Energy shareholders received one share of DT Midstream common stock for every two shares of DTE Energy common stock held at the close of business on the record date, with certain shareholders receiving cash in lieu of fractional shares of DT Midstream common stock. For U.S. federal income tax purposes, DTE Energy’s U.S. shareholders generally should not recognize gain or loss as a result of the distribution of DT Midstream stock, except with respect to cash received in lieu of fractional shares.

In June 2021, in order to facilitate the separation and settle intercompany balances with DTE Energy, DT Midstream issued long-term debt in the form of $2.1 billion senior notes and a $1.0 billion term loan. Using the debt proceeds, net of discount and issuance costs of $53 million, DT Midstream made the following cash payments:

•Settled Short-term borrowings due to DTE Energy as of June 30, 2021 of $2,537 million

•Settled affiliate Accounts receivable due from DTE Energy and affiliate Accounts payable due to DTE Energy as of June 30, 2021 for net cash paid to DTE Energy of $9 million

•Provided a one-time special dividend to DTE Energy of $501 million

These payments eliminated in consolidation and had no direct impact ~~of this standard~~ on ~~their~~DTE Energy’s Consolidated Financial ~~Statements.~~

~~In August 2018,~~Statements of Financial Position. During the ~~FASB issued ASU No. 2018-13,~~ ~~Fair Value Measurements (Topic 820): Disclosure Framework~~ — ~~Changes~~third quarter 2021, DTE Energy used the proceeds received from DT Midstream to optionally redeem $2.6 billion of long-term debt. Refer to Note 10 to the ~~Disclosure Requirements for Fair Value Measurement~~. The amendments in this update modify the disclosure requirements on fair value measurements in Topic 820. The ASU is effective for the Registrants for fiscal years beginning after December 15, 2019, and interim periods therein. Early adoption is permitted. The Registrants are currently assessing the impact of this standard on their Consolidated Financial ~~Statements.~~Statements, “Long-term Debt,” for additional information.

Continuing Involvement

Following the separation on July 1, 2021, DT Midstream became an independent public company listed under the symbol “DTM” on the New York Stock Exchange (NYSE) and DTE Energy no longer retains any ownership in DT Midstream. In ~~August 2018,~~order to govern the ~~FASB issued ASU No. 2018-14,~~ ~~Compensation~~ — ~~Retirement Benefits~~ — ~~Defined Benefit Plans (Subtopic 715-20): Disclosure Framework~~ — ~~Changes~~ongoing relationships between DT Midstream and DTE Energy after the separation and to facilitate an orderly transition, the ~~Disclosure requirements for employers that sponsor defined benefit pension or other postretirement plans. The amendments~~parties entered into a series of agreements including the following:

•Separation and Distribution Agreement – sets forth the principal actions to be taken in this update modify the disclosure requirements for employers that sponsor defined benefit pension or other postretirement plans. The ASU is effective for the Registrants for fiscal years ending after December 15, 2020. Early adoption is permitted. The Registrants are currently assessing the impact of this standard on their Consolidated Financial Statements.

~~In August 2018, the FASB issued ASU No. 2018-15,~~ ~~Intangibles~~ — ~~Goodwill and Other~~ — ~~Internal-Use Software (Subtopic 350-40): Customer's Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That is a Service Contract. The amendments in this update align the requirements for capitalizing implementation costs incurred in a hosting arrangement that is a service contract~~connection with the ~~requirements~~separation, including the transfer of assets and assumption of liabilities, among others, and sets forth other agreements governing aspects of the relationship between DTE Energy and DT Midstream

•Transition Services Agreement – allows for ~~capitalizing implementation~~DTE Energy to provide DT Midstream with specified services for a limited time and no longer than 24 months following the separation, with related costs ~~incurred~~ to ~~develop or obtain internal-use software (and hosting arrangements that~~be paid by DT Midstream. Services include ~~an internal use software license). The ASU is effective~~support for gas operations, information technology, accounting, tax, legal, human resources, and various other administrative services

•Tax Matters Agreement – governs the ~~Registrants for fiscal years beginning~~respective rights, responsibilities and obligations of DTE Energy and DT Midstream after ~~December 15, 2019,~~the separation with respect to all tax matters

•Employee Matters Agreement – addresses certain employment, compensation and ~~interim periods therein. Early adoption is permitted. The Registrants are currently assessing~~benefits matters, including the ~~impact~~allocation and treatment of ~~this standard on their Consolidated Financial Statements.~~certain assets and liabilities relating to DT Midstream employees

~~In October 2018, the FASB issued ASU No. 2018-17,~~ ~~Consolidation (Topic 810):Targeted Improvements to Related Party Guidance for Variable Interest Entities~~. The amendments in this update modify the requirements for determining whether a decision-making fee is a variable interest and require reporting entities to consider indirect interests held through related parties under common control on a proportional basis. The ASU is effective for the Registrants for fiscal years beginning after December 15, 2019, and interim periods therein. Early adoption is permitted. The Registrants are currently assessing the impact of this standard on their Consolidated Financial Statements.

137

2018 2017 2016
(In millions)
Service cost $ 20
$ 20
$ 20
Interest cost 53
56
61
Expected return on plan assets (98 ) (90 ) (90 )
Amortization of:
Net actuarial loss 8
8
21
Prior service credit —
(10 ) (89 )
Net other postretirement credit $ (17 ) $ (16 ) $ (77 )

DTE Energy Company — DTE Electric Company

Combined Notes to Consolidated Financial Statements — (Continued)

Net other postretirement credit for DTE Electric includes the following components:


	2021		2020		2019
	(In millions)
Service cost	$	23	$	20	$	16
Interest cost	35		43		53
Expected return on plan assets	(86)		(87)		(65)
Amortization of:
Net actuarial loss	11		11		5
Prior service credit	(14)		(14)		(7)

Net other postretirement cost (credit)	$	(31)	$	(27)	$	2


	2021		2020
	(In millions)
Other changes in plan assets and accumulated postretirement benefit obligation recognized in Regulatory assets
Net actuarial gain	$	(84)	$	(26)
Amortization of net actuarial loss	(11)		(11)
Amortization of prior service credit	14		14

Total recognized in Regulatory assets	$	(81)	$	(23)
Total recognized in net periodic benefit cost and Regulatory assets	$	(112)	$	(50)

138

2018 2017
(In millions)
Other changes in plan assets and accumulated postretirement benefit obligation recognized in Regulatory assets
Net actuarial (gain) loss $ (46 ) $ 2
Amortization of net actuarial loss (8 ) (8 )
Amortization of prior service (cost) credit (35 ) 10
Total recognized in Regulatory assets $ (89 ) $ 4
Total recognized in net periodic benefit cost and Regulatory assets $ (106 ) $ (12 )
Estimated amounts to be amortized from Regulatory assets into net periodic benefit cost during next fiscal year
Net actuarial loss $ 5
$ 8
Prior service credit $ (7 ) $ —

DTE Energy Company — DTE Electric Company

Combined Notes to Consolidated Financial Statements — (Continued)

The following table reconciles the obligations, assets, and funded status of the plans including amounts recorded as Accrued postretirement liability in the Registrants' Consolidated Statements of Financial Position at December 31:


	DTE Energy						DTE Electric							DTE Energy				DTE Electric
	2018			2017			2018			2017				2021		2020		2021		2020
	(In millions)													(In millions)
Change in accumulated postretirement benefit obligation													Change in accumulated postretirement benefit obligation
Accumulated postretirement benefit obligation, beginning of year	$	1,910		$	1,795		$	1,470		$	1,373		Accumulated postretirement benefit obligation, beginning of year	$	1,807	$	1,751	$	1,369	$	1,337
Service cost	27			27			20			20			Service cost	30		26		23		20
Interest cost	69			73			53			56			Interest cost	46		56		35		43
Plan amendments	(44		)	—			(35		)	—			Plan amendments	1		—		—		—
Actuarial (gain) loss	(227		)	101			(196		)	84			Actuarial (gain) loss	(100)		54		(73)		31

Benefits paid	(90		)	(86		)	(65		)	(63		)	Benefits paid	(82)		(80)		(61)		(62)
Accumulated postretirement benefit obligation, end of year	$	1,645		$	1,910		$	1,247		$	1,470		Accumulated postretirement benefit obligation, end of year	$	1,702	$	1,807	$	1,293	$	1,369
Change in plan assets													Change in plan assets
Plan assets at fair value, beginning of year	$	1,848		$	1,758		$	1,272		$	1,218		Plan assets at fair value, beginning of year	$	1,960	$	1,819	$	1,320	$	1,236
Actual return on plan assets	(75		)	252			(52		)	172			Actual return on plan assets	142		220		96		145

Benefits paid	(84		)	(162		)	(62		)	(118		)	Benefits paid	(81)		(79)		(61)		(61)
Plan assets at fair value, end of year	$	1,689		$	1,848		$	1,158		$	1,272		Plan assets at fair value, end of year	$	2,021	$	1,960	$	1,355	$	1,320
Funded status	$	44		$	(62	)	$	(89	)	$	(198	)	Funded status	$	319	$	153	$	62	$	(49)
Amount recorded as:													Amount recorded as:
Noncurrent assets	$	45		$	—		$	189		$	113		Noncurrent assets	$	678	$	561	$	402	$	335
Current liabilities	(1		)	(1		)	—			—			Current liabilities	(1)		(1)		—		—
Noncurrent liabilities	—			(61		)	(278		)	(311		)	Noncurrent liabilities	(358)		(407)		(340)		(384)
	$	44		$	(62	)	$	(89	)	$	(198	)		$	319	$	153	$	62	$	(49)
Amounts recognized in Accumulated other comprehensive income (loss), pre-tax													Amounts recognized in Accumulated other comprehensive income (loss), pre-tax
Net actuarial (gain) loss	$	1		$	(1	)	$	—		$	—
Net actuarial gain													Net actuarial gain	$	(1)	$	(7)	$	—	$	—

	$	1		$	(1	)	$	—		$	—
Amounts recognized in Regulatory assets^(a)													Amounts recognized in Regulatory assets(a)
Net actuarial loss	$	257		$	279		$	156		$	211		Net actuarial loss	$	102	$	234	$	61	$	156
Prior service credit	(44		)	(1		)	(35		)	—			Prior service credit	(49)		(69)		(34)		(48)
	$	213		$	278		$	121		$	211
														$	53	$	165	$	27	$	108

(a)See Note 9 to the Consolidated Financial Statements, "Regulatory Matters."


~~(a)~~	~~See Note 9 to the Consolidated Financial Statements, "Regulatory Matters."~~

The decrease in the Registrants' other postretirement benefit obligations for the year ended December 31, 2021 was primarily due to an actuarial gain driven by an increase in discount rates. The increase in the other postretirement benefit obligations in 2020 was primarily due to an actuarial loss driven by a decrease in discount rates, partially offset by favorable changes in healthcare cost assumptions.

The following table reflects other postretirement benefit plans with accumulated postretirement benefit obligations in excess of plan assets as of December 31:


	DTE Energy				DTE Electric
	2021		2020		2021		2020
	(In millions)
Accumulated postretirement benefit obligation	$	822	$	878	$	775	$	826
Fair value of plan assets	463		470		435		442
Accumulated postretirement benefit obligation in excess of plan assets	$	359	$	408	$	340	$	384

139

DTE Energy Company — DTE Electric Company

Combined Notes to Consolidated Financial Statements — (Continued)

At December 31, ~~2018,~~2021, the benefits expected to be paid, including prescription drug benefits, in each of the next five years and in the aggregate for the five fiscal years thereafter for the Registrants are as follows:

DTE Energy DTE Electric
(In millions)
2019 $ 88
$ 66
2020 92
70
2021 96
73
2022 100
75
2023 102
77
2024-2028 532
402
Total $ 1,010
$ 763


	DTE Energy		DTE Electric
	(In millions)
2022	$	85	$	64
2023	89		68
2024	91		69
2025	94		71
2026	95		72
2027-2031	493		375
Total	$	947	$	719

Assumptions used in determining the accumulated postretirement benefit obligation and net other postretirement benefit costs of the Registrants are:

2018 2017 2016
Accumulated postretirement benefit obligation
Discount rate 4.40% 3.70% 4.25%
Health care trend rate pre- and post- 65 6.75 / 7.25% 6.75 / 7.25% 6.50 / 6.75%
Ultimate health care trend rate 4.50% 4.50% 4.50%
Year in which ultimate reached pre- and post- 65 2031 2030 2028
Other postretirement benefit costs
Discount rate 3.70% 4.25% 4.50%
Expected long-term rate of return on plan assets 7.75% 7.75% 8.00%
Health care trend rate pre- and post- 65 6.75 / 7.25% 6.50 / 6.75% 6.25 / 6.75%
Ultimate health care trend rate 4.50% 4.50% 4.50%
Year in which ultimate reached pre- and post- 65 2030 2028 2027

A one percentage point increase in health care cost trend rates would have increased the total service cost and interest cost components of benefit costs for DTE Energy by $4 million, including $3 million for DTE Electric, in 2018 and would have increased the accumulated benefit obligation for DTE Energy by $72 million, including $51 million for DTE Electric, at December 31, 2018. A one percentage point decrease in the health care cost trend rates would have decreased the total service and interest cost components of benefit costs for DTE Energy by $4 million, including $3 million for DTE Electric, in 2018 and would have decreased the accumulated benefit obligation for DTE Energy by $63 million, including $45 million for DTE Electric, at December 31, 2018.


	2021	2020	2019
Accumulated postretirement benefit obligation
Discount rate	2.91%	2.58%	3.29%
Health care trend rate pre- and post- 65	6.75 / 7.25%	6.75 / 7.25%	6.75 / 7.25%
Ultimate health care trend rate	4.50%	4.50%	4.50%
Year in which ultimate reached pre- and post- 65	2034	2033	2032
Other postretirement benefit costs
Discount rate	2.58%	3.29%	4.40%

Expected long-term rate of return on plan assets	6.70%	7.20%	7.30%
Health care trend rate pre- and post- 65	6.75 / 7.25%	6.75 / 7.25%	6.75 / 7.25%
Ultimate health care trend rate	4.50%	4.50%	4.50%
Year in which ultimate reached pre- and post- 65	2033	2032	2031

The process used in determining the long-term rate of return on assets for the other postretirement benefit plans is similar to that previously described for the pension plans. As a result of this process, the Registrants have a long-term rate of return assumption for the other postretirement benefit plans of 6.40% for 2022. The Registrants believe this rate is a reasonable assumption for the long-term rate of return on plan assets for 2022 given the current investment strategy.

The DTE Energy Company Master VEBA Trust employs a ~~total return~~liability driven investment ~~approach.~~program whereby the characteristics of plan liabilities are considered when determining investment policy. Risk tolerance is established through consideration of future plan cash flows, plan funded status, and corporate financial considerations. The investment portfolio contains a diversified blend of equity, fixed income, and other investments. Furthermore, equity investments are diversified across U.S. and non-U.S. stocks and large and small market capitalizations. Fixed income investments generally include U.S. Treasuries, other governmental debt, diversified corporate bonds, bank loans, and mortgage-backed securities. Other investments are used to enhance long-term returns while improving portfolio diversification. Derivatives may be utilized in a risk controlled manner to potentially increase the portfolio beyond the market value of invested assets and/or reduce portfolio investment risk. Investment risk is measured and monitored on an ongoing basis through annual liability measurements, periodic asset/liability studies, and quarterly investment portfolio reviews.

Target allocations for the Registrants' other postretirement benefit plan assets as of December 31, 2021 are listed below:


U.S. Large Cap Equity Securities	10	%
U.S. Small Cap and Mid Cap Equity Securities	2
Non-U.S. Equity Securities	10
Fixed Income Securities	54
Hedge Funds and Similar Investments	10
Private Equity and Other	14
	100	%

140

DTE Energy Company — DTE Electric Company

Combined Notes to Consolidated Financial Statements — (Continued)

~~Target allocations for the Registrants' other postretirement benefit plan assets as of December 31, 2018 are listed below:~~



~~U.S. Large Cap Equity Securities~~	16	%
~~U.S. Small Cap and Mid Cap Equity Securities~~	4
~~Non-U.S. Equity Securities~~	19
~~Fixed Income Securities~~	28
~~Hedge Funds and Similar Investments~~	19
~~Private Equity and Other~~	14
	~~100~~	%

~~DTE Energy Company — DTE Electric Company~~

~~Combined Notes to Consolidated Financial Statements — (Continued)~~

The following tables provide the fair value measurement amounts for the Registrants' other postretirement benefit plan assets at December 31, ~~2018~~2021 and ~~2017~~^2020(a):


	December 31, 2021						December 31, 2020
	Level 1		Level 2		Other(b)		Total		Level 1		Level 2		Other(b)		Total
	(In millions)
DTE Energy asset category:
Short-term Investments(c)	$	39	$	—	$	—	$	39	$	21	$	—	$	—	$	21
Equity Securities
Domestic(d)	27		—		199		226		51		—		200		251
International(e)	27		—		141		168		23		—		178		201
Fixed Income Securities
Governmental(f)	343		32		—		375		40		45		—		85
Corporate(g)	—		355		271		626		—		477		379		856
Hedge Funds and Similar Investments(h)	58		26		120		204		61		17		124		202
Private Equity and Other(i)	—		—		383		383		—		—		344		344


DTE Energy Total	$	494	$	413	$	1,114	$	2,021	$	196	$	539	$	1,225	$	1,960

DTE Electric asset category:
Short-term Investments(c)	$	26	$	—	$	—	$	26	$	14	$	—	$	—	$	14
Equity Securities
Domestic(d)	18		—		132		150		33		—		131		164
International(e)	18		—		93		111		16		—		117		133
Fixed Income Securities
Governmental(f)	230		21		—		251		24		31		—		55
Corporate(g)	—		235		187		422		—		321		263		584
Hedge Funds and Similar Investments(h)	39		17		81		137		41		11		83		135
Private Equity and Other(i)	—		—		258		258		—		—		235		235


DTE Electric Total	$	331	$	273	$	751	$	1,355	$	128	$	363	$	829	$	1,320

(a)For a description of levels within the fair value hierarchy see Note 12 to the Consolidated Financial Statements, "Fair Value."

(b)Amounts represent assets valued at NAV as a practical expedient for fair value.

(c)This category predominantly represents certain short-term fixed income securities and money market investments that are managed in separate accounts or commingled funds. Pricing for investments in this category are obtained from quoted prices in actively traded markets.

(d)This category represents portfolios of large, medium and small capitalization domestic equities. Investments in this category include exchange-traded securities for which unadjusted quoted prices can be obtained and exchange-traded securities held in a commingled fund classified as NAV assets.

(e)This category primarily consists of portfolios of non-U.S. developed and emerging market equities. Investments in this category include exchange-traded securities for which unadjusted quoted prices can be obtained and exchange-traded securities held in a commingled fund classified as NAV assets.

(f)This category includes U.S. Treasuries, bonds and other governmental debt. Pricing for investments in this category is obtained from quoted prices in actively traded markets and quotations from broker or pricing services.

(g)This category primarily consists of corporate bonds from diversified industries, bank loans, and mortgage backed securities. Pricing for investments in this category is obtained from quotations from broker or pricing services. Non-exchange traded securities and exchange-traded securities held in commingled funds are classified as NAV assets.

(h)This category utilizes a diversified group of strategies that attempt to capture uncorrelated sources of income and includes publicly traded mutual funds, insurance-linked and asset-backed securities, commingled funds and limited partnership funds. Pricing for mutual funds in this category is obtained from quoted prices in actively traded markets. Prices for insurance-linked and asset-backed securities are obtained from quotations from broker or pricing services. Commingled funds and limited partnership funds are classified as NAV assets.

(i)This category includes a diversified group of funds and strategies that primarily invests in private equity partnerships. This category also includes investments in private real estate and private debt. All investments in this category are classified as NAV assets.

141

December 31, 2018 December 31, 2017
Level 1 Level 2
Other^(b)
Total Level 1 Level 2
Other^(b)
Total
DTE Energy asset category: (In millions)
Short-term Investments^(c)
$ 14
$ 2
$ —
$ 16
$ 13
$ 2
$ —
$ 15
Equity Securities
U.S. Large Cap^(d)
225
—
—
225
284
—
—
284
U.S. Small Cap and Mid Cap^(e)
75
—
—
75
131
—
—
131
Non-U.S.^(f)
234
—
67
301
288
1
77
366
Fixed Income Securities^(g)
11
350
130
491
29
324
130
483
Hedge Funds and Similar Investments^(h)
97
—
203
300
116
—
219
335
Private Equity and Other⁽ⁱ⁾
—
—
281
281
—
—
234
234
Securities Lending^(j)
(21 ) (1 ) —
(22 ) (39 ) (1 ) —
(40 )
Securities Lending Collateral^(j)
21
1
—
22
39
1
—
40
DTE Energy Total $ 656
$ 352
$ 681
$ 1,689
$ 861
$ 327
$ 660
$ 1,848

DTE Electric asset category:
Short-term Investments^(c)
$ 10
$ 1
$ —
$ 11
$ 9
$ 1
$ —
$ 10
Equity Securities

U.S. Large Cap^(d)
154
—
—
154
195
—
—
195
U.S. Small Cap and Mid Cap^(e)
52
—
—
52
91
—
—
91
Non-U.S.^(f)
163
—
45
208
200
1
52
253
Fixed Income Securities^(g)
7
232
92
331
20
218
92
330
Hedge Funds and Similar Investments^(h)
68
—
139
207
80
—
150
230
Private Equity and Other⁽ⁱ⁾
—
—
195
195
—
—
163
163
Securities Lending^(j)
(15 ) —
—
(15 ) (27 ) (1 ) —
(28 )
Securities Lending Collateral^(j)
15
—
—
15
27
1
—
28
DTE Electric Total $ 454
$ 233
$ 471
$ 1,158
$ 595
$ 220
$ 457
$ 1,272


~~(a)~~	~~For a description of levels within the fair value hierarchy see Note 12 to the Consolidated Financial Statements, "Fair Value."~~


~~(b)~~	~~Amounts represent assets valued at NAV as a practical expedient for fair value.~~


~~(c)~~	This category predominantly represents certain short-term fixed income securities and money market investments that are managed in separate accounts or commingled funds. Pricing for investments in this category are obtained from quoted prices in actively traded markets or valuations from brokers or pricing services.


~~(d)~~	~~This category represents portfolios of large capitalization domestic equities. Investments in this category are exchange-traded securities whereby unadjusted quoted prices can be obtained.~~


~~(e)~~	~~This category represents portfolios of small and medium capitalization domestic equities. Investments in this category are exchange-traded securities whereby unadjusted quoted prices can be obtained.~~


~~(f)~~	This category primarily consists of portfolios of non-U.S. developed and emerging market equities. Investments in this category are exchange-traded securities whereby unadjusted quoted prices can be obtained. Exchange-traded securities held in a commingled fund are classified as NAV assets.

~~(g)~~

This category includes corporate bonds from diversified industries, U.S. Treasuries, other governmental debt, bank loans, and mortgage backed securities. Pricing for investments in this category is obtained from quoted prices in actively traded markets and quotations from broker or pricing services. Non-exchange traded securities and exchange-traded securities held in commingled funds are classified as NAV assets.


~~(h)~~	This category utilizes a diversified group of strategies that attempt to capture financial market inefficiencies and includes publicly traded mutual funds, commingled funds and limited partnership funds. Pricing for mutual funds in this category is obtained from quoted prices in actively traded markets. Commingled funds and limited partnership funds are classified as NAV assets.


~~(i)~~	This category includes a diversified group of funds and strategies that primarily invests in private equity partnerships. This category also includes investments in real estate and private debt. All investments in this category are classified as NAV assets.


~~(j)~~	The Registrants have a securities lending program with a third-party agent. The program allows the agent to lend certain securities from the Registrants' VEBA trust to selected entities against receipt of collateral (in the form of cash) as provided for and determined in accordance with their securities lending agency agreements.

DTE Energy Company — DTE Electric Company

Combined Notes to Consolidated Financial Statements — (Continued)

The DTE Energy Company Master VEBA Trust holds debt and equity securities directly and indirectly through commingled funds. Exchange-traded debt and equity securities held directly, as well as publicly traded commingled funds, are valued using quoted market prices in actively traded markets. ~~The~~Non-publicly traded commingled funds hold exchange-traded equity or debt securities and are valued based on NAVs. Non-exchange traded fixed income securities are valued by the trustee based upon quotations available from brokers or pricing services. A primary price source is identified by asset type, class, or issue for each security. The trustee monitors prices supplied by pricing services and may use a supplemental price source or change the primary price source of a given security if the trustee challenges an assigned price and determines that another price source is considered preferable. The Registrants have obtained an understanding of how these prices are derived, including the nature and observability of the inputs used in deriving such prices.

~~There were no significant transfers between Level 2 and Level 1 in the years ended December 31, 2018 and 2017 for either of the Registrants.~~

Defined Contribution Plans

The Registrants also sponsor defined contribution retirement savings plans. Participation in one of these plans is available to substantially all represented and non-represented employees. For substantially all employees, the Registrants match employee contributions up to certain predefined limits based upon eligible compensation and the employee’s contribution rate. Additionally, for eligible represented and non-represented employees who do not participate in the Pension Plans, the Registrants annually contribute an amount equivalent to 4% (8% for certain DTE Gas represented employees) of an employee's eligible pay to the employee's defined contribution retirement savings plan. For DTE Energy, the cost of these plans was ~~$61~~$70 million, ~~$57~~$73 million, and ~~$51~~$65 million for the years ended December 31, ~~2018, 2017,~~2021, 2020, and ~~2016,~~2019, respectively. For DTE Electric, the cost of these plans was ~~$29~~$34 million, ~~$27~~$34 million, and ~~$23~~$31 million for the years ended December 31, ~~2018, 2017,~~2021, 2020, and ~~2016.~~2019, respectively.

NOTE 21 — STOCK-BASED COMPENSATION

DTE Energy’s stock incentive program permits the grant of incentive stock options, non-qualifying stock options, stock awards, performance shares, and performance units to employees and members of its Board of Directors. As a result of a stock award, a settlement of an award of performance shares, or by exercise of a participant’s stock option, DTE Energy may deliver common stock from its authorized but unissued common stock and/or from outstanding common stock acquired by or on behalf of DTE Energy in the name of the participant. Key provisions of the stock incentive program are:

•Authorized limit is ~~16,500,000~~20,162,716 shares of common stock;

•Prohibits the grant of a stock option with an exercise price that is less than the fair market value of DTE Energy’s stock on the date of the grant; and

•Imposes the following award limits to a single participant in a single calendar year, (1) options for more than 500,000 shares of common stock; (2) stock awards for more than 150,000 shares of common stock; (3) performance share awards for more than 300,000 shares of common stock (based on the maximum payout under the award); or (4) more than 1,000,000 performance units, which have a face amount of $1.00 each.

DTE Energy records compensation expense at fair value over the vesting period for all awards it grants.

The following table summarizes the components of stock-based compensation for DTE Energy:


	2021		2020		2019
	(In millions)
Stock-based compensation expense	$	71	$	63	$	71
Tax benefit	$	13	$	12	$	13
Stock-based compensation cost capitalized in Property, plant, and equipment(a)	$	—	$	—	$	16

2018 2017 2016
(In millions)
Stock-based compensation expense $ 64
$ 58
$ 61
Tax benefit $ 13
$ 23
$ 24
Stock-based compensation cost capitalized in Property, plant, and equipment $ 11
$ 9
$ 10
(a)In DTE Electric's May 2020 rate order, the MPSC disallowed certain capital expenditures related to incentive compensation. Therefore, beginning in 2020, no stock-based compensation cost will be capitalized in Property, plant, and equipment.

142

DTE Energy Company — DTE Electric Company

Combined Notes to Consolidated Financial Statements — (Continued)

~~Stock Options~~

Options are exercisable according to the terms of the individual stock option award agreements and expire ten years after the date of the grant. The option exercise price equals the fair value of the stock on the date that the option was granted. Stock options vest ratably over a three-year period.

~~The following table summarizes DTE Energy's stock option activity for the year ended December 31, 2018:~~

Number of Options Weighted Average Exercise Price Aggregate Intrinsic
Value
(In millions)
Options outstanding and exercisable at December 31, 2017 105,994
$ 42.95

Exercised (53,894 ) $ 42.62

Options outstanding and exercisable at December 31, 2018 52,100
$ 43.30
$ 4

~~As of December 31, 2018, the weighted average remaining contractual life for the exercisable shares is 1.11 years. As of December 31, 2018, all options were vested. No options vested during 2018.~~

There were no options granted during 2018, 2017, or 2016. The intrinsic value of options exercised for the years ended December 31, 2018 was $4 million. The intrinsic value of options for the years ended December 31, 2017 and 2016 was $4 million. No option expense was recognized for 2018, 2017, or 2016.

~~The number, weighted average exercise price, and weighted average remaining contractual life of DTE Energy options outstanding as of December 31, 2018 were as follows:~~

Range of Exercise Prices Number of Options Weighted Average
Exercise Price Weighted Average
Remaining Contractual Life (Years)
$ 27.00 — $ 38.00
2,100
$ 27.70
0.16
$ 42.01 — $ 45.00
50,000
$ 43.95
1.15
52,100
$ 43.30
1.11

Restricted Stock Awards

Stock awards granted under the plan are restricted for varying periods, generally for three years. Participants have all rights of a shareholder with respect to a stock award, including the right to receive dividends and vote the shares. Prior to vesting in stock awards, the participant: (i) may not sell, transfer, pledge, exchange, or otherwise dispose of shares; (ii) shall not retain custody of the share certificates; and (iii) will deliver to DTE Energy a stock power with respect to each stock award upon request.

The stock awards are recorded at cost that approximates fair value on the date of grant. The cost is amortized to compensation expense over the vesting period.

~~Stock award activity for DTE Energy~~The fair value of awards vested were not material for the years ended December 31, ~~was:~~

2018 2017 2016
Fair value of awards vested (in millions) $ 11
$ 10
$ 9
Restricted common shares awarded 109,393
136,825
145,240
Weighted average market price of shares awarded $ 105.80
$ 99.53
$ 87.28
Compensation cost charged against income (in millions) $ 11
$ 11
$ 11

~~DTE Energy Company — DTE Electric Company~~

~~Combined Notes to Consolidated Financial Statements — (Continued)~~

~~The following table summarizes DTE Energy’s restricted stock awards activity~~2021, 2020, and 2019. Compensation cost charged against income was $14 million, $13 million, and $11 million for the ~~year~~years ended December 31, ~~2018:~~

Restricted
Stock Weighted Average
Grant Date
Fair Value
Balance at December 31, 2017 365,764
$ 90.26
Grants 109,393
$ 105.80
Forfeitures (21,939 ) $ 98.59
Vested and issued (125,813 ) $ 85.24
Balance at December 31, 2018 327,405
$ 96.79
2021, 2020, and 2019, respectively.

Performance Share Awards

Performance shares awarded under the plan are for a specified number of shares of DTE Energy common stock that entitle the holder to receive a cash payment, shares of DTE Energy common stock, or a combination thereof. The final value of the award is determined by the achievement of certain performance objectives and market conditions. The awards vest at the end of a specified period, usually three years. Awards granted in ~~2018, 2017,~~2021, 2020, and ~~2016~~2019 were primarily deemed to be equity awards. The DTE Energy stock price and number of probable shares attributable to market conditions for such equity awards are fair valued only at the grant date. DTE Energy accounts for performance share awards by accruing compensation expense over the vesting period based on: (i) the number of shares expected to be paid which is based on the probable achievement of performance objectives; and (ii) the closing stock price market value. The settlement of the award is based on the closing price at the settlement date.

DTE Energy recorded ~~compensation expense for~~activity relating to performance share awards as follows:

2018 2017 2016
(In millions)
Compensation expense $ 53
$ 47
$ 50
Cash settlements^(a)
$ 13
$ 15
$ 7
Stock settlements^(a)
$ 39
$ 66
$ 38


	2021		2020		2019
	(In millions, except per share amounts)
Weighted average grant date fair value of awards granted (per share)	$	118.43	$	129.68	$	115.85
Awards settled in cash(a)	$	12	$	21	$	19
Awards settled in stock(a)	$	74	$	53	$	79
Compensation expense	$	58	$	50	$	60


~~(a)~~	~~Sum of cash and stock settlements approximates the intrinsic value of the awards.~~

(a)Sum of awards settled in cash and stock approximates the intrinsic value of the awards.

During the vesting period, the recipient of a performance share award has no shareholder rights. During the period beginning on the date the performance shares are awarded and ending on the certification date of the performance objectives, the number of performance shares awarded will be increased, assuming full dividend reinvestment at the fair market value on the dividend payment date. The cumulative number of performance shares will be adjusted to determine the final payment based on the performance objectives achieved. Performance share awards are nontransferable and are subject to risk of forfeiture.

~~The following table summarizes DTE Energy’s performance share activity for the period ended December 31, 2018:~~

143

Performance Shares Weighted Average
Grant Date
Fair Value
Balance at December 31, 2017 1,324,401
$ 90.31
Grants 437,508
$ 105.64
Forfeitures (56,435 ) $ 96.02
Payouts (418,788 ) $ 84.84
Balance at December 31, 2018 1,286,686
$ 97.17

DTE Energy Company — DTE Electric Company

Combined Notes to Consolidated Financial Statements — (Continued)

The following table summarizes DTE Energy’s performance share activity for the period ended December 31, 2021:


	Performance Shares	Weighted Average Grant Date Fair Value
Balance at December 31, 2020	1,127,437	$	117.06
Grants(a)	567,196	$	118.43
Forfeitures(b)	(162,091)	$	123.04
Payouts	(429,925)	$	107.84
Balance at December 31, 2021	1,102,617	$	120.33

(a)Includes 166,686 incremental shares granted in 2021 to DTE Energy employees who did not separate with DT Midstream. The shares were granted to preserve the value of unvested 2019-2021 awards, considering the impact from the spin-off of DT Midstream on DTE Energy's stock price.

(b)Includes the cancellation of 95,923 shares that were held by employees that separated due to the spin-off of DT Midstream.

Unrecognized Compensation Costs

As of December 31, ~~2018,~~2021, DTE Energy's total unrecognized compensation cost related to non-vested stock incentive plan arrangements and the weighted average recognition period was as follows:


					Unrecognized Compensation Cost		Weighted Average to be Recognized
	Unrecognized Compensation Cost		Weighted Average to be Recognized		(In millions)		(In years)
	(In millions)		(In years)
Stock awards	$	12	1.03	Stock awards	$	19	1.50
Performance shares	59		1.04	Performance shares	44		1.04
	$	71	1.04		$	63	1.18



~~Commission File Number~~Michigan		~~Registrants,~~ 38-3217752
(State or other jurisdiction of ~~Incorporation, Address, and Telephone Number~~incorporation or organization)		~~I.R.S.~~(I.R.S Employer Identification No.)
~~1-11607~~	~~DTE Energy Company~~


Michigan						38-0478650
(State or other jurisdiction of incorporation or organization)						(I.R.S Employer Identification No.)



	Indexed Returns Year Ended December 31,
	Base Period
Company/Index	2013	2014	2015	2016	2017	2018
DTE Energy Company	100.00	134.61	129.54	164.41	188.40	196.30
S&P 500 Index	100.00	113.69	115.26	129.04	157.19	150.29
S&P 500 Multi-Utilities Index	100.00	128.94	126.71	150.22	168.38	171.35



	2018		2017		2016		2015		2014
	(In millions, except per share amounts)
Operating Revenues	$	14,212	$	12,607	$	10,630	$	10,337	$	12,301
Net Income Attributable to DTE Energy Company^(a)	$	1,120	$	1,134	$	868	$	727	$	905
Diluted Earnings Per Common Share	$	6.17	$	6.32	$	4.83	$	4.05	$	5.10
Financial Information
Dividends declared per share of common stock	$	3.60	$	3.36	$	3.06	$	2.84	$	2.69
Total Assets	$	36,288	$	33,767	$	32,041	$	28,662	$	27,827
Long-Term Debt^(b)	$	12,134	$	12,185	$	11,269	$	8,760	$	8,271
Shareholders’ equity	$	10,237	$	9,512	$	9,011	$	8,772	$	8,327



	Number of Shares Purchased^(a)	Average Price Paid per Share^(a)		Number of Shares Purchased as Part of Publicly Announced Plans or Programs	Average Price Paid per Share	Maximum Dollar Value that May Yet Be Purchased Under the Plans or Programs
10/01/2018 — 10/31/2018	143	$	110.14	—	—	—
11/01/2018 — 11/30/2018	—	$	—	—	—	—
12/01/2018 — 12/31/2018	—	$	—	—	—	—
Total	143			—


~~(a)~~	~~Represents shares of DTE Energy common stock withheld to satisfy income tax obligations upon the vesting of restricted stock based on the price in effect at the grant date.~~


~~(a)~~	~~The 2017 results include a $105 million net income tax benefit related to the enactment of the TCJA.~~


~~(b)~~	~~Long-Term Debt includes Capital lease obligations and excludes debt due within one year.~~



	2018
	(In millions)
Higher demand due to improved conditions in the steel business	$	59
Higher production in the renewables business	25
Higher production, offset by lower coal prices in the REF business	18
Higher sales primarily associated with new contracts in the on-site business	13
	$	115

	2017
	(In millions)
Higher demand due to improved conditions in the steel business	$	107
Higher production driven by new projects, offset by lower coal prices in the REF business	102
Lower production and one-time recovery in 2016, offset by an acquisition in the renewables business	(9		)
Lower sales primarily associated with expired contracts in the on-site business	(17		)
	$	183



	2018
	(In millions)
Unrealized Margins^(a)
Favorable results, primarily in the power trading strategy	$	20
Unfavorable results, primarily in gas structured, and power full requirements strategies^(b)	(100		)
	(80		)
Realized Margins^(a)
Favorable results, primarily in the gas structured strategy	54
Unfavorable results, primarily in the power full requirements strategy^(c)	(34		)
	20
Decrease in Non-utility Margin	$	(60	)


~~(b)~~			~~Amount includes $74 million of timing related losses related to gas strategies which will reverse in future periods as the underlying contracts settle.~~2020

			(In millions)
Unrealized Margins(a)
~~(c)~~ Favorable results, primarily in gas structured and gas transportation strategies(b)			~~Amount includes $11 million of timing related gains related to gas strategies recognized in previous periods that reversed as the underlying contracts settled.~~$

83
~~(a)~~Unfavorable results, primarily in environmental and gas trading, and power full requirements strategies			Natural gas structured transactions typically involve a physical purchase or sale of natural gas in the future and/or natural gas basis financial instruments which are derivatives and a related non-derivative pipeline transportation contract. These gas structured transactions can result in significant earnings volatility as the derivative components are marked-to-market without revaluing the related non-derivative contracts.

(58)
~~(b)~~			~~Amount includes $113 million of timing related gains related to gas strategies which will reverse in future periods as the underlying contracts settle.~~



~~DTE Energy~~	x	~~DTE Electric~~	x

25
~~(c)~~ Realized Margins(a)	~~Amount includes $95 million of timing related losses related to~~
Favorable results, primarily in power full requirements, environmental trading, and gas transportation strategies ~~recognized~~	21
Unfavorable results, primarily in ~~previous periods that reversed as the underlying contracts settled.~~gas structured and gas full requirements strategies(c)	(63)
	(42)
Decrease in Non-utility Margin	$	(17)



	Total		2019		2020-2021		2022-2023		2024 and Thereafter
	(In millions)
Long-term debt:
Mortgage bonds, notes, and other^(a)	$	12,566	$	1,495	$	1,144	$	1,793	$	8,134
Junior subordinated debentures^(b)	1,180		—		—		—		1,180
Capital lease obligations	11		4		7		—		—
Interest	10,340		556		1,016		929		7,839
Stock purchase contract	33		33		—		—		—
Operating leases	154		42		48		19		45
Electric, gas, fuel, transportation, and storage purchase obligations^(c)	5,509		2,216		1,465		591		1,237
Long-term DTE Electric renewable energy power purchase agreements^(d)(e)	1,133		100		162		162		709
Other long-term obligations^(f)(g)(h)	715		375		326		7		7
Total obligations	$	31,641	$	4,821	$	4,168	$	3,501	$	19,151


~~(a)~~	~~Excludes $16 million of unamortized debt discount and $73 million of unamortized debt issuance costs.~~


~~(b)~~	~~Excludes~~ ~~$35 million~~ ~~of unamortized debt issuance costs.~~


~~(c)~~	~~Excludes amounts associated with full requirements contracts where no stated minimum purchase volume is required.~~


~~(d)~~	The agreements represent the minimum obligations with suppliers for renewable energy and renewable energy credits under existing contract terms which expire from 2030 through 2035. DTE Electric's share of plant output ranges from 29% to 100%.


~~(e)~~	~~Excludes a power purchase agreement with a non-utility affiliate of DTE Energy.~~


~~(f)~~	~~Includes liabilities for unrecognized tax benefits of $10 million.~~


~~(g)~~	~~Excludes other long-term liabilities of $172 million not directly derived from contracts or other agreements.~~


Reporting Unit	Goodwill		Fair Value Reduction %^(a)		Discount Rate		Terminal Multiple^(b)	Valuation Methodology^(c)	Reporting Unit	Goodwill		Fair Value Reduction %(a)		Discount Rate		Valuation Methodology(b)(c)
	(In millions)									(In millions)
Electric	$	1,208	35	%	6	%	10.0x	DCF, assuming stock sale	Electric	$	1,208	51	%	5.2	%	DCF and market multiples analysis
Gas	743		30	%	7	%	12.0x	DCF, assuming stock sale	Gas	743		47	%	5.3	%	DCF and market multiples analysis
Gas Storage and Pipelines	299		19	%	7	%	n/a^(d)	DCF, assuming asset sale
Power and Industrial Projects^(e)	26		18	%	6	%	9.0x	DCF, assuming asset sale^(f)

DTE Vantage									DTE Vantage	25		50	%	7.7	%	DCF
Energy Trading	17		56	%	12	%	n/a^(g)	DCF, assuming asset sale	Energy Trading	17		95	%	9.3	%	DCF
	$	2,293								$	1,993


~~(a)~~	~~Percentage by which the fair value of equity of the reporting unit would need to decline to equal its carrying value, including goodwill.~~


~~(b)~~	~~Multiple of enterprise value (sum of debt plus equity value) to earnings before interest, taxes, depreciation, and amortization (EBITDA).~~


~~(c)~~	~~Discounted cash flows (DCF) incorporated 2019-2023 projected cash flows plus a calculated terminal value.~~


~~(d)~~	Due to the nature of the projected cash flows for Gas Storage and Pipelines, DTE Energy capitalized the terminal year cash flows at the weighted average cost of capital (WACC) less an assumed long-term growth rate of 3.0% in lieu of applying a terminal EBITDA multiple.


~~(e)~~	~~Power and Industrial Projects excludes the Biomass reporting unit, as this unit has no allocated goodwill.~~


~~(f)~~	~~Asset sales were assumed, except for Power and Industrial Projects' reduced emissions fuels projects, which assumed stock sales.~~


~~(g)~~	~~Due to lack of market comparable information for Energy Trading, DTE Energy capitalized the terminal year cash flows at the WACC in lieu of applying a terminal EBITDA multiple.~~



	Total
	(In millions)
MTM at December 31, 2017	$	8
Reclassified to realized upon settlement	74
Changes in fair value recorded to income	(81		)
Amounts recorded to unrealized income	(7		)
Changes in fair value recorded in regulatory liabilities	9
Change in collateral	(30		)
Amounts recorded in Other comprehensive income, pretax	(3		)
MTM at December 31, 2018	$	(23	)


	Total
	(In millions)
MTM at December 31, 2020	$	28
Reclassified to realized upon settlement	14
Changes in fair value recorded to income	(184)
Amounts recorded to unrealized income	(170)
Changes in fair value recorded in Regulatory liabilities	19


Change in collateral	(36)
MTM at December 31, 2021	$	(159)


Source of Fair Value	2022		2023		2024		2025 and Beyond		Total Fair Value
	(In millions)
Level 1	$	54	$	30	$	9	$	3	$	96
Level 2	37		(10)		(19)		(6)		2
Level 3	(93)		(38)		(15)		(69)		(215)
MTM before collateral adjustments	$	(2)	$	(18)	$	(25)	$	(72)	(117)
Collateral adjustments									(42)
MTM at December 31, 2021									$	(159)