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Business Update – DTE Energy Co.

DTE Energy Co. · Mar 3, 2014 · 49 slides

Investor presentation from the Shale Experts oil & gas presentation and slide database. Every page is imaged and its text indexed for search across operators, plays, basins and time.

Slides

  1. Business Update – DTE Energy Co. – slide 1
    Business Update March 3 4, 2014
  2. Business Update – DTE Energy Co. – slide 2
    Overview Long-Term Growth Update Financial Update Summary 3
  3. Business Update – DTE Energy Co. – slide 3
    DTE Energy is an integrated energy company Strong, Stable and Growing Complementary Utilities Non-Utility Businesses DTE Electric Gas Storage & Pipelines (GSP) Electric generation and Transport and store natural gas distribution…
  4. Business Update – DTE Energy Co. – slide 4
    A substantial portion of our non-utility operating earnings are either regulated or contracted 2018 Earnings Mix Regulated / contracted earnings consist of: Electric and gas utilities 4% 30% FERC regulated gas pipelines…
  5. Business Update – DTE Energy Co. – slide 5
    Our system of priorities is fundamental to how we create value for our investors 5% - 6% Annual EPS Growth Attractive Dividend Strong Balance Sheet 6
  6. Business Update – DTE Energy Co. – slide 6
    2013 Accomplishments Employee Engagement Higher employee engagement o Seventh consecutive year of improved Gallup scores moved from 78th to 85th percentile* in 2013 o Received Gallup Great Workplace Award o Achieved best safety…
  7. Business Update – DTE Energy Co. – slide 7
    2013 Accomplishments (continued) Political / Regulatory Continuing to play an active role in the review of Michigans energy policy Implemented rate minimization strategy Spent over 800 million with Michigan companies, exceeding our…
  8. Business Update – DTE Energy Co. – slide 8
    Overview Long-Term Growth Update Financial Update Summary 9
  9. Business Update – DTE Energy Co. – slide 9
    We remain committed to delivering 5% to 6% operating EPS* growth (dollars) Operating EPS* Guidance 7.2% CAGR Midpoint 2008-2014 4.30 4.09 3.94 3.75 3.64 Dividend 3.33 per share 5.4% CAGR 2009-2013 2.83 (Annualized)…
  10. Business Update – DTE Energy Co. – slide 10
    Our strong earnings growth opportunities coupled with our contingency planning gives us confidence in our ability to deliver 5% 6% operating EPS* growth 15% - 20% 9% 5% - 6% 5% - 6% 1% - 2% Non-Utilities 4% Utilities…
  11. Business Update – DTE Energy Co. – slide 11
    DTE Energy has many catalysts for strong future growth opportunities Constructive REGULATORY Michigans economic recovery environment Long-term utility growth Long-term non-utility growth 12
  12. Business Update – DTE Energy Co. – slide 12
    Michigan economic indicators highlight continued growth over the next few years Increased Auto Production Gross State Product (000s) (billons) 370 2,574 362 2,252 2,429 2,366 349 353 341 1,912 330 1,578 314 1,144 Upgraded…
  13. Business Update – DTE Energy Co. – slide 13
    Upward pressure on customer rates being minimized by cost control initiatives and surcharge reductions Reliability Lower Investments Surcharges Cost Structural Pressure Cost Reductions Environmental Continuous Investments…
  14. Business Update – DTE Energy Co. – slide 14
    Utility rate strategies minimize new rate filings and their impacts on our customers DTE Electric DTE Gas Periodic rate cases to support Infrastructure Recovery Mechanism investment profile provides recovery of investments File…
  15. Business Update – DTE Energy Co. – slide 15
    DTE Electric will increase rate base 3 billion since 2011 rate order with no new rates (billions) DTE Electric Rate Base* Base rates flat over this period Avoided 400 million in rate 3.0 13.5 - 13.7 increases 10.7 DTE…
  16. Business Update – DTE Energy Co. – slide 16
    Our electric utility is investing 6.7 billion in three key growth areas through 2018 Base Generation New Infrastructure Compliance Generation 5.6 billion 700 million 400 million Power plant reliability Environmental requirements…
  17. Business Update – DTE Energy Co. – slide 17
    Plant modernization and energy policy drive investments that will transform our generation mix over the next decade Potential Retirements 2,600 MW Long-term Units 4,400 MW DTE Energy Coal Fleet (MW of Capacity)…
  18. Business Update – DTE Energy Co. – slide 18
    Our gas utility is making 1.2 billion of reliability and pipeline integrity investments through 2018 Base Main Renewal, Meter Move-Out Infrastructure & Pipeline Integrity 700 million 500 million Strengthen and expand distribution…
  19. Business Update – DTE Energy Co. – slide 19
    Gas Storage & Pipelines is developing an asset portfolio with multiple growth platforms Pipeline Gathering Storage 20
  20. Business Update – DTE Energy Co. – slide 20
    Gas Storage & Pipelines platforms drive growth through new projects and expansions Pipeline Platform Gathering Platform Storage Platform Bluestone Pipeline Bluestone Gathering Washington 10 Bluestone Pipeline Bluestone Gathering…
  21. Business Update – DTE Energy Co. – slide 21
    Gas Storage & Pipelines operating earnings* potential of 130 million by 2018 (millions) 130 New Project Development 25 (NEXUS; other gathering and pipeline expansions) 20 Storage Platform 78 - 86 70 61 45 Gathering…
  22. Business Update – DTE Energy Co. – slide 22
    Power & Industrial Projects is focused in three key business lines Industrial Energy Services Renewable Energy Reduced Emissions Fuel Wood-fired Plant Cassville, WI On-site Energy Project Wood-fired Plant Reduced Emissions Fuel…
  23. Business Update – DTE Energy Co. – slide 23
    Power & Industrial Projects is targeting 155 million of operating earnings* by 2018 through growth in each of its business lines (millions) 155 New Project Development / 30 Acquisitions 35 Renewable Energy 75 - 85 Reduced 70…
  24. Business Update – DTE Energy Co. – slide 24
    Power & Industrial Projects applies a systematic approach to evaluate business opportunities to achieve premium returns Limited . Focus on niche areas where we can capitalize on unique Competition competencies Long-Term . Contract…
  25. Business Update – DTE Energy Co. – slide 25
    Overview Long-Term Growth Update Financial Update Summary 26
  26. Business Update – DTE Energy Co. – slide 26
    DTE Energy 2014 Operating Earnings Guidance (millions, except EPS) 2013 2014 Early 2014 Actuals* Outlook* Guidance* 2014 Guidance Drivers DTE Electric 484 515 - 525 520 - 530 Benefits favorability due to changes in discount…
  27. Business Update – DTE Energy Co. – slide 27
    DTE Energy 2014 Cash Flow Guidance Cash Flow Summary Drivers (billions) 2013 2014 Actual Guidance 2014 cash from operations decreases due Cash From Operations* 2.2 1.6 to lower utility surcharge collections than Capital Spending…
  28. Business Update – DTE Energy Co. – slide 28
    DTE Energy 2014 Capital Expenditure Guidance Capital Expenditures Summary Drivers (millions) 2013 2014 Actual Guidance DTE Electric capital higher due to DTE Electric increased environmental, renewable energy, and reliability…
  29. Business Update – DTE Energy Co. – slide 29
    2014 2016 cash from operations and equity issuances plan supports utility capital spend and a strong balance sheet (billions) 8.0 8.0 Equity 0.5 Targeting zero equity issuances in 2014 Debt 2.7 Annual issuances of 200 million…
  30. Business Update – DTE Energy Co. – slide 30
    Overview Long-Term Growth Update Financial Update Summary 31
  31. Business Update – DTE Energy Co. – slide 31
    Summary Long-term plan supports continued 5% - 6% operating EPS growth On track to achieve 2014 operating earnings guidance Constructive regulation, coupled with a focus on operational excellence and strong customer satisfaction,…
  32. Business Update – DTE Energy Co. – slide 32
    Contact Us DTE Energy Investor Relations www.dteenergy.com/investors (313) 235-8030 33
  33. Business Update – DTE Energy Co. – slide 33
    Appendix
  34. Business Update – DTE Energy Co. – slide 34
    DTE Energy 2013 Operating Earnings Variance Operating Earnings* Drivers (millions, except EPS) DTE Electric 2012 2013 Change Return to near normal weather in 2013 and higher DTE Electric 483 484 1 storm expense, offset by lower…
  35. Business Update – DTE Energy Co. – slide 35
    DTE Electric plans 6.7 billion of investments over the next 5 years (millions) 1,600 6,700 700 1,350 1,325 1,300 1,350 400 Environmental 1,100 1,100 1,000 New Generation Other Projects* 500 Distribution Reliability…
  36. Business Update – DTE Energy Co. – slide 36
    DTE Electric has built or contracted for approximately 890MWs of renewable energy (850MWs of wind) since 2009 LAnse Warden Renewable Cumulative Investment 17 MW Biomass ( millions) Baraga County 1,100 340 600 160 Tuscola Bay…
  37. Business Update – DTE Energy Co. – slide 37
    DTE Gas plans 1.2 billion of investments over the next 5 years (millions) 1,200 240 240 240 240 240 209 Main Renewal, Meter Move-Out, 500 Pipeline Integrity Base 700 2013A 2014E 2015E 2016E 2017E 2018E 2014E - 2018E…
  38. Business Update – DTE Energy Co. – slide 38
    DTEs CI capability has enabled us to lead the industry in cost management Electric Industry Peers* 2007 to 2012 Change in O&M Costs 70% Avg. 33% DTE 0% Gas Industry Peers** 2007 to 2012 Change in O&M Costs 66% Avg.…
  39. Business Update – DTE Energy Co. – slide 39
    Gas Storage & Pipelines assets have expansion opportunities to accommodate increased demand Capacity Pipeline Assets Bcf/ d In-Service Millennium Pipeline 0.5 Expansion 1 and 2 0.3 2013 - 2014 Expansion 3 0.2 - 0.5 2016 - 2017…
  40. Business Update – DTE Energy Co. – slide 40
    Energy Trading mark-to-market (MTM) operating earnings adjustment is timing related and will substantially reverse in 2014 (millions) Components of natural gas sale transaction Operating adjustment pertains to pipeline Producer…
  41. Business Update – DTE Energy Co. – slide 41
    DTE Energy Trading Reconciliation of Operating Earnings* to Economic Net Income ( millions) 24 21 Operating Earnings* Economic net income equals economic gross (millions, after-tax) margin*** minus O&M (3) expenses and taxes.…
  42. Business Update – DTE Energy Co. – slide 42
    Energy regulation passed in 2008 established a more constructive regulatory environment Key components of the 2008 Energy Legislation Regulatory Structure Changes Renewables and Energy Efficiency File & Use Rates with 6 month self-…
  43. Business Update – DTE Energy Co. – slide 43
    Michigan Public Service Commission The Michigan Public Service Commission is composed of three members appointed by the Governor with the advice and consent of the Senate. Commissioners are appointed to serve staggered six-year…
  44. Business Update – DTE Energy Co. – slide 44
    2013 Reconciliation of Reported to Operating Earnings Use of Operating Earnings Information DTE Energy management believes that operating earnings provide a more meaningful representation of the companys earnings from ongoing operations…
  45. Business Update – DTE Energy Co. – slide 45
    2012 Reconciliation of Reported to Operating Earnings Use of Operating Earnings Information DTE Energy management believes that operating earnings provide a more meaningful representation of the companys earnings from ongoing operations…
  46. Business Update – DTE Energy Co. – slide 46
    2011 Reconciliation of Reported to Operating Earnings Use of Operating Earnings Information DTE Energy management believes that operating earnings provide a more meaningful representation of the companys earnings from ongoing operations…
  47. Business Update – DTE Energy Co. – slide 47
    2010 Reconciliation of Reported to Operating Earnings Use of Operating Earnings Information DTE Energy management believes that operating earnings provide a more meaningful representation of the companys earnings from ongoing operations…
  48. Business Update – DTE Energy Co. – slide 48
    2009 Reconciliation of Reported to Operating Earnings Use of Operating Earnings Information DTE Energy management believes that operating earnings provide a more meaningful representation of the companys earnings from ongoing operations…
  49. Business Update – DTE Energy Co. – slide 49
    2008 Reconciliation of Reported to Operating Earnings Use of Operating Earnings Information DTE Energy management believes that operating earnings provide a more meaningful representation of the companys earnings from ongoing…

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