DTE Energy Co Profile
DTE Energy Company (DTE Energy) operates as a public utility.
DTE Energy's utility operations consist primarily of DTE Electric and DTE Gas. DTE Energy also has two other segments that are engaged in a variety of energy-related businesses.
DTE Electric is an 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 2.3 million customers in southeastern Michigan.
DTE Gas is an 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 include DTE Vantage, which is primarily involved in renewable natural gas projects and providing custom energy solutions to industrial, commercial, and institutional customers; and energy marketing and trading operations.
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 (DTE Energy and DTE Electric) are regulated by other federal and state regulatory agencies including the NRC, the EPA, EGLE, and for DTE Energy, the CFTC and CARB.
Electric
The Electric segment principally consists of DTE Electric, which is engaged in the generation, purchase, distribution, and sale of electricity to approximately 2.3 million residential, commercial, and industrial customers in southeastern Michigan.
Gas
The Gas segment principally consists 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
DTE Vantage primarily consists of renewable energy projects that sell electricity and pipeline-quality gas and projects that deliver custom energy solutions to industrial, commercial, and institutional customers.
Energy Trading consists of energy marketing and trading operations.
Electric segment
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 2.3 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 EGLE. Electricity is primarily generated by two coal-fired plants, a combined cycle natural gas plant, a hydroelectric pumped storage plant, a nuclear plant, wind and solar 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.
DTE Electric's peak load and highest total system sales generally occur during the third quarter of the year (year ended December 2023), driven by air conditioning and other cooling-related demands.
The Electric segment also includes non-utility operations relating to renewable energy projects at DTE Sustainable Generation, which were acquired to support DTE Energy's renewable energy goals.
Fuel Supply and Purchased Power
DTE Electric's power is generated primarily from a variety of fuels and is supplemented with renewable generation and purchased power. DTE Electric expects to have an adequate supply of power to meet its obligation to serve customers. DTE Electric's generating capability is largely dependent upon the availability of coal and natural gas.
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 8.6 million tons of low-sulfur western coal and approximately 1.0 million tons of Appalachian coal to be delivered from 2024 to 2025. DTE Electric has 97% of its expected coal requirements under contract for 2024. DTE Electric leases a fleet of rail cars and has the expected western and eastern coal rail requirements under multi-year contracts. DTE Electric's 2024 rail transportation is covered under long-term agreements. DTE Electric expects to cover all of its 2024 vessel transportation requirements for delivery of purchased coal to electric generating facilities through existing agreements.
DTE Electric's natural gas supply requirements are expected to be met through a combination of short and long-term agreements, agreements with local distribution companies, and spot market purchases. Natural gas purchase requirements for 2024 are expected to be approximately 63 Bcf. DTE Electric has contracts for firm gas transportation and storage capacity to ensure reliable and flexible gas supply to its power plants.
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.
DTE Electric owns and operates 701 distribution substations with a capacity of approximately 37,650,000 kilovolt-amperes (kVA) and approximately 453,700 line transformers with a capacity of approximately 33,359,000 kVA.
Regulation
DTE Electric is subject to the regulatory jurisdiction of various agencies, including but not limited to, the MPSC, the FERC, and the NRC. DTE Electric is subject to the requirements of other regulatory agencies with respect to safety, the environment, and health.
To enhance customer affordability, DTE Electric is also working to optimize opportunities from the Inflation Reduction Act to generate production tax credits for wind and solar production and existing nuclear generation, as well as investment tax credits for solar and energy storage.
Gas segment
DTE Energy's Gas segment principally consists 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.
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 (year ended December 2023).
Natural Gas Supply
DTE Gas' gas distribution system has a planned maximum daily send-out capacity of 2.4 Bcf, with approximately 65% of the volume coming from underground storage for 2023.
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.
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.
Properties
DTE Gas owns distribution, storage, and transportation properties that are located in the state of Michigan. The distribution system includes approximately 21,000 miles of distribution mains, approximately 1.2 million service pipelines, and approximately 1.3 million active 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 through a finance lease arrangement.
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 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. DTE Gas is subject to the requirements of other regulatory agencies with respect to safety, the environment, and health.
Strategy
DTE Gas' strategy is to ensure the safe and reliable delivery of natural gas service within its franchised markets in Michigan.
DTE Vantage
DTE Vantage primarily consists of renewable energy projects that sell electricity and pipeline-quality gas and projects that deliver customer energy solutions to industrial, commercial, and institutional customers. This business segment provides services using project assets usually located on or near the customers' premises in the agricultural, steel, automotive, airport, chemical, and other industries.
Renewable Energy
Renewable Gas Recovery — DTE Vantage has ownership interests in, and operates, twenty-two gas recovery sites in nine 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 and generate environmental attributes, including environmental credits from California's Low Carbon Fuel Standard (LCFS) and the federal Renewable Fuel Standard (RFS), and in some cases may generate tax credits. The gas is then sold to off-takers, along with the environmental attributes, to be used as low carbon transportation fuel.
Wholesale Power and Renewables — DTE Vantage holds ownership interests in, and operates, three renewable generating plants with a capacity of 114 MWs. The electric output is sold under long-term power purchase agreements.
Custom Energy Solutions
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 — DTE Vantage produces metallurgical coke from a coke battery with a capacity of 1 million tons per year and has an investment in a second coke battery with a capacity of 1.2 million tons per year. DTE Vantage supplies metallurgical and petroleum coke to the steel and other industries.
Emerging Ventures
Carbon Capture and Sequestration — DTE Vantage is developing multiple carbon capture projects across the United States to help customers reduce their emissions and meet their evolving environmental commitments. This process captures carbon dioxide from industrial emitters and transports it to sequestration sites where it is injected deep underground, preventing release into the atmosphere.
Regulation
Certain electric generating facilities within DTE Vantage have market-based rate authority from the FERC to sell power. The facilities are subject to FERC reporting requirements and market behavior rules. Certain projects of DTE Vantage are also subject to the applicable laws, rules, and regulations related to the EPA, the U.S. Department of Homeland Security, DOE, CARB, and various state utility commissions.
Strategy
DTE Vantage intends to focus on the following areas for growth: acquiring and developing renewable energy projects and other energy projects; providing energy and utility-type services to commercial and industrial customers; and developing decarbonization opportunities related to carbon capture and sequestration 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 environmental attributes to various customers. Energy Trading's customer base is predominantly utilities, local natural gas 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. 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.
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, the U.S. Department of Homeland Security, and DOE. In addition, Energy Trading is subject to applicable laws, rules, and regulations in Canada.
Strategy
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.
DTE Energy monitors its safety performance through many measures, with a primary focus on the rate of safety incidents, as defined by the Office of Safety and Health Administration (OSHA rate).
History
DTE Energy Company was founded in 1849. The company was incorporated in the state of Michigan in 1995.
