Document and Company Informatio
Document and Company Information (USD $) | |
9 Months Ended
Sep. 30, 2009 | |
Document And Company Information [Abstract] | |
Entity Registrant Name | DTE ENERGY CO |
Entity Central Index Key | 0000936340 |
Document Type | 10-Q |
Document Period End Date | 2009-09-30 |
Amendment Flag | false |
Current Fiscal Year End Date | --12-31 |
Entity Well-known Seasoned Issuer | Yes |
Entity Voluntary Filers | No |
Entity Current Reporting Status | Yes |
Entity Filer Category | Large Accelerated Filer |
Entity Public Float | $5,795,571,642 |
Entity Common Stock, Shares Outstanding | 164,928,049 |
Consolidated Statements of Fina
Consolidated Statements of Financial Position (USD $) | ||
In Millions | Sep. 30, 2009
| Dec. 31, 2008
|
Current Assets | ||
Cash and cash equivalents | $83 | $86 |
Restricted cash | 28 | 86 |
Accounts receivable (less allowance for doubtful accounts of $288 and $265, respectively) | ||
Customer | 1,105 | 1,666 |
Other | 112 | 166 |
Inventories | ||
Fuel and gas | 383 | 333 |
Materials and supplies | 202 | 206 |
Deferred income taxes | 226 | 227 |
Derivative assets | 271 | 316 |
Other | 244 | 242 |
Total Current Assets | 2,654 | 3,328 |
Investments | ||
Nuclear decommissioning trust funds | 791 | 685 |
Other | 630 | 595 |
Total Investments | 1,421 | 1,280 |
Property | ||
Property, plant and equipment | 20,505 | 20,065 |
Less accumulated depreciation and depletion | (8,110) | (7,834) |
Property, plant and equipment, net | 12,395 | 12,231 |
Other Assets | ||
Goodwill | 2,037 | 2,037 |
Regulatory assets | 4,029 | 4,231 |
Securitized regulatory assets | 905 | 1,001 |
Intangible assets | 57 | 70 |
Notes receivable | 114 | 115 |
Derivative assets | 163 | 140 |
Other | 184 | 157 |
Total Noncurrent Assets | 7,489 | 7,751 |
Total Assets | 23,959 | 24,590 |
Current Liabilities | ||
Accounts payable | 578 | 899 |
Accrued interest | 149 | 119 |
Dividends payable | 87 | 86 |
Short-term borrowings | 205 | 744 |
Current portion long-term debt, including capital leases | 170 | 362 |
Derivative liabilities | 257 | 285 |
Other | 530 | 518 |
Total Current Liabilities | 1,976 | 3,013 |
Long-Term Debt (net of current portion) | ||
Mortgage bonds, notes and other | 6,738 | 6,458 |
Securitization bonds | 793 | 932 |
Trust preferred-linked securities | 289 | 289 |
Capital lease obligations | 54 | 62 |
Total Long-Term Debt (net of current portion) | 7,874 | 7,741 |
Other Liabilities | ||
Deferred income taxes | 2,091 | 1,958 |
Regulatory liabilities | 1,251 | 1,202 |
Asset retirement obligations | 1,405 | 1,340 |
Unamortized investment tax credit | 88 | 96 |
Derivative liabilities | 252 | 344 |
Liabilities from transportation and storage contracts | 100 | 111 |
Accrued pension liability | 776 | 871 |
Accrued postretirement liability | 1,424 | 1,434 |
Nuclear decommissioning | 131 | 114 |
Other | 319 | 328 |
Total Noncurrent Liabilities | 7,837 | 7,798 |
Shareholders' Equity | ||
Common stock, without par value, 400,000,000 shares authorized, 164,928,049 and 163,019,596 shares issued and outstanding, respectively | 3,235 | 3,175 |
Retained earnings | 3,142 | 2,985 |
Accumulated other comprehensive loss | (141) | (165) |
Total DTE Energy Company Shareholders' Equity | 6,236 | 5,995 |
Noncontrolling interests | 36 | 43 |
Total Equity | 6,272 | 6,038 |
Total Liabilities and Equity | $23,959 | $24,590 |
1_Consolidated Statements of Fi
Consolidated Statements of Financial Position (Parenthetical) (USD $) | ||
In Millions, except Share data | Sep. 30, 2009
| Dec. 31, 2008
|
Current Assets | ||
Allowance for doubtful accounts | $288 | $265 |
Shareholders' Equity | ||
Common stock, without par value | 0 | 0 |
Common stock, shares authorized | 400,000,000 | 400,000,000 |
Common stock, shares issued | 164,928,049 | 163,019,596 |
Common stock, shares outstanding | 164,928,049 | 163,019,596 |
Consolidated Statements of Oper
Consolidated Statements of Operations (Unaudited) (USD $) | ||||
In Millions, except Per Share data | 3 Months Ended
Sep. 30, 2009 | 3 Months Ended
Sep. 30, 2008 | 9 Months Ended
Sep. 30, 2009 | 9 Months Ended
Sep. 30, 2008 |
Operating Revenues | $1,961 | $2,338 | $5,904 | $7,159 |
Operating Expenses | ||||
Fuel, purchased power and gas | 735 | 1,034 | 2,272 | 3,332 |
Operation and maintenance | 554 | 628 | 1,740 | 2,081 |
Depreciation, depletion and amortization | 266 | 235 | 738 | 677 |
Taxes other than income | 63 | 71 | 204 | 229 |
Gain on sale of non-utility assets | 0 | 0 | 0 | (128) |
Other asset (gains) and losses, reserves and impairments, net | 0 | (5) | (3) | 7 |
Total Operating Expenses | 1,618 | 1,963 | 4,951 | 6,198 |
Operating Income | 343 | 375 | 953 | 961 |
Other (Income) and Deductions | ||||
Interest expense | 143 | 125 | 409 | 371 |
Interest income | (11) | (5) | (17) | (13) |
Other income | (28) | (34) | (74) | (74) |
Other expenses | 8 | 22 | 17 | 45 |
Total Other (Income) and Deductions | 112 | 108 | 335 | 329 |
Income Before Income Taxes | 231 | 267 | 618 | 632 |
Income Tax Provision | 73 | 97 | 197 | 231 |
Income from Continuing Operations | 158 | 170 | 421 | 401 |
Discontinued Operations Income, net of tax | 0 | 8 | 0 | 22 |
Net Income | 158 | 178 | 421 | 423 |
Less: Net Income Attributable to Noncontrolling Interests From | ||||
Continuing operations | 0 | 1 | 2 | 4 |
Discontinued operations | 0 | 0 | 0 | 2 |
Total Net Inome Attributable to the Noncontrolling Interest | 0 | 1 | 2 | 6 |
Net Income Attributable to DTE Energy Company | $158 | $177 | $419 | $417 |
Basic Earnings per Common Share | ||||
Income from continuing operations | 0.96 | 1.03 | 2.55 | 2.43 |
Discontinued operations | $0 | 0.05 | $0 | 0.12 |
Total | 0.96 | 1.08 | 2.55 | 2.55 |
Diluted Earnings Per Common Share | ||||
Income from continuing operations | 0.96 | 1.03 | 2.55 | 2.43 |
Discontinued operations | $0 | 0.05 | $0 | 0.12 |
Total | 0.96 | 1.08 | 2.55 | 2.55 |
Weighted Average Common Shares Outstanding | ||||
Basic | 165 | 163 | 164 | 163 |
Diluted | 165 | 163 | 164 | 163 |
Dividends Declared per Common Share | 0.53 | 0.53 | 1.59 | 1.59 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows (Unaudited) (USD $) | ||
In Millions | 9 Months Ended
Sep. 30, 2009 | 9 Months Ended
Sep. 30, 2008 |
Operating Activities | ||
Net Income | $421 | $423 |
Adjustments to reconcile net income to net cash from operating activities: | ||
Depreciation, depletion and amortization | 738 | 675 |
Deferred income taxes | 141 | 280 |
Gain on sale of non-utility assets | 0 | (128) |
Other asset (gains), losses and reserves, net | 4 | 12 |
Gain on sale of interests in synfuel projects | 0 | (31) |
Contributions from synfuel partners | 0 | 14 |
Changes in assets and liabilities, exclusive of changes shown separately (Note 1) | 370 | (227) |
Net cash from operating activities | 1,674 | 1,018 |
Investing Activities | ||
Plant and equipment expenditures - utility | (772) | (842) |
Plant and equipment expenditures - non-utility | (47) | (154) |
Proceeds from sale of interests in synfuel projects | 0 | 84 |
Refunds to synfuel partners | 0 | (387) |
Proceeds from sale of non-utility assets | 0 | 253 |
Proceeds from sale of other assets, net | 35 | 21 |
Restricted cash for debt redemptions | 58 | 104 |
Proceeds from sale of nuclear decommissioning trust fund assets | 237 | 180 |
Investment in nuclear decommissioning trust funds | (251) | (202) |
Other investments | (55) | (105) |
Net cash used for investing activities | (795) | (1,048) |
Financing Activities | ||
Issuance of long-term debt | 363 | 1,013 |
Redemption of long-term debt | (420) | (446) |
Repurchase of long-term debt | 0 | (238) |
Short-term borrowings, net | (574) | 71 |
Issuance of common stock | 27 | 0 |
Repurchase of common stock | 0 | (16) |
Dividends on common stock | (260) | (258) |
Other | (18) | (7) |
Net cash from (used) for financing activities | (882) | 119 |
Net Increase (Decrease) in Cash and Cash Equivalents | (3) | 89 |
Cash and Cash Equivalents Reclassified from Assets Held for Sale | 0 | 11 |
Cash and Cash Equivalents at Beginning of Period | 86 | 123 |
Cash and Cash Equivalents at End of Period | $83 | $223 |
Consolidated Statements of Chan
Consolidated Statements of Changes in Shareholders Equity and Comprehensive Income (Unaudited) (USD $) | |||||
In Millions, except Share data | Common Stock
| Retained Earnings
| Accumulated Other Comprehensive Loss
| Noncontrolling Interest
| Total
|
Beginning Balance, shares at Dec. 31, 2008 | 163,020,000 | 163,019,596 | |||
Beginning Balance at Dec. 31, 2008 | $3,175 | $2,985 | ($165) | $43 | $6,038 |
Net Income | 419 | 2 | 421 | ||
Benefit obligations, net of tax | 7 | 7 | |||
Foreign currency translation, net of tax | 2 | 2 | |||
Dividends declared on common stock | (262) | (262) | |||
Issuance of common stock | 27 | 27 | |||
Issuance of common stock, shares | 862,000 | ||||
Net change in unrealized losses on derivatives, net of tax | 1 | 1 | |||
Net change in unrealized losses on investments, net of tax | 14 | 14 | |||
Stock-based compensation, distributions to noncontrolling interests and other | 33 | (9) | 24 | ||
Stock-based compensation, distributions to noncontrolling interests and other, shares | 1,046,000 | ||||
Ending Balance at Sep. 30, 2009 | $3,235 | $3,142 | ($141) | $36 | $6,272 |
Ending Balance, shares at Sep. 30, 2009 | 164,928,000 | 164,928,049 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income (Unaudited) (USD $) | ||
In Millions | 9 Months Ended
Sep. 30, 2009 | 9 Months Ended
Sep. 30, 2008 |
Net Income | $421 | $423 |
Other comprehensive income (loss), net of tax: | ||
Benefit obligations, net of taxes of $4 | 7 | 0 |
Foreign currency translation, net of taxes of $1 | 2 | 0 |
Net unrealized gains (losses) on derivatives: | ||
Gains (losses) during the period, net of taxes of $1 and $0, respectively | 2 | (1) |
Amounts reclassified to income, net of taxes of $ (1) and $2, respectively | (1) | 3 |
Net change in unrealized losses on derivatives, net of tax | 1 | 2 |
Net unrealized gains (losses) on investments: | ||
Gains (losses) during the period, net of taxes of $8 and $(9), respectively | 14 | (17) |
Comprehensive income | 445 | 408 |
Less: Comprehensive income attributable to noncontrolling interests | 2 | 6 |
Comprehensive income attributable to DTE Energy Company | $443 | $402 |
2_Consolidated Statements of Co
Consolidated Statements of Comprehensive Income (Parenthetical) (Unaudited) (USD $) | ||
In Millions | 9 Months Ended
Sep. 30, 2009 | 9 Months Ended
Sep. 30, 2008 |
Other comprehensive income (loss), net of tax: | ||
Tax effect on benefit obligations | $4 | $0 |
Tax effect on gains (losses) during the period | 1 | 0 |
Net unrealized gains (losses) on derivatives: | ||
Tax effect on Foreign currency translation | 1 | 0 |
Tax effect on amounts reclassified to income | (1) | 2 |
Net unrealized gains (losses) on investments: | ||
Tax effect on gains (losses) during the period | $8 | ($9) |
General
General | |
9 Months Ended
Sep. 30, 2009 USD / shares | |
General [Abstract] | |
GENERAL | NOTE 1 GENERAL The Company is a diversified energy company. It is the parent company of Detroit Edison and MichCon, regulated electric and gas utilities engaged primarily in the business of providing electricity and natural gas sales, distribution and storage services throughout southeastern Michigan. The Company also operates four energy-related non-utility segments with operations throughout the United States. These Consolidated Financial Statements should be read in conjunction with the Notes to Consolidated Financial Statements included in the 2008 Annual Report on Form 10-K, as updated to reflect certain accounting changes on Form 8-K dated August20, 2009. The accompanying Consolidated Financial Statements are prepared using accounting principles generally accepted in the United States of America. These accounting principles require management to use estimates and assumptions that impact reported amounts of assets, liabilities, revenues and expenses, and the disclosure of contingent assets and liabilities. Actual results may differ from the Companys estimates. The Consolidated Financial Statements are unaudited, but in our opinion include all adjustments necessary for a fair presentation of such financial statements. All adjustments are of a normal recurring nature, except as otherwise disclosed in these Consolidated Financial Statements and Notes to Consolidated Financial Statements. Financial results for this interim period are not necessarily indicative of results that may be expected for any other interim period or for the fiscal year ending December31, 2009. Certain prior year amounts have been reclassified to reflect current year classifications. Asset Retirement Obligations The Company has a legal retirement obligation for the decommissioning costs for its Fermi 1 and Fermi 2 nuclear plants. To a lesser extent, the Company has legal retirement obligations for gas production facilities, gas gathering facilities and various other operations. The Company has conditional retirement obligations for gas pipeline retirement costs and disposal of asbestos at certain of its power plants. To a lesser extent, the Company has conditional retirement obligations at certain service centers, compressor and gate stations, and disposal costs for PCB contained within transformers and circuit breakers. The Company recognizes such obligations as liabilities at fair market value when they are incurred, which generally is at the time the associated assets are placed in service. Fair value is measured using expected future cash outflows discounted at our credit-adjusted risk-free rate. In its regulated operations, the Company defers timing differences that arise in the expense recognition of legal asset retirement costs that are currently recovered in rates. A reconciliation of the asset retirement obligations for the nine months ended September30, 2009 follows: (in Millions) Asset retirement obligations at January1, 2009 $ 1,361 Accretion 66 Liabilities settled (10 ) Revision in estimated cash flows 5 Asset retirement obligations at September30, 2009 1,422 |
New Accounting Pronouncements
New Accounting Pronouncements | |
9 Months Ended
Sep. 30, 2009 USD / shares | |
New Accounting Pronouncements [Abstract] | |
NEW ACCOUNTING PRONOUNCEMENTS | NOTE 2 NEW ACCOUNTING PRONOUNCEMENTS FASB Accounting Standards Codification (Codification) In June2009, the FASB voted to approve that on July1, 2009, the Codification will become the single source of authoritative nongovernmental U.S. GAAP. The Codification is a reorganization of current GAAP into a topical format that eliminates the current GAAP hierarchy and establishes two levels of guidance authoritative and non-authoritative. According to the FASB, all non-grandfathered, non-SEC accounting literature that is not included in the Codification would be considered non-authoritative. The FASB has indicated that the Codification does not change current GAAP. Instead, the proposed changes aim to (1)reduce the time and effort it takes for users to research accounting questions and (2)improve the usability of current accounting standards. The Codification is effective for interim and annual periods ending after September15, 2009. Fair Value Accounting In September2006, the FASB issued ASC 820 (SFAS No.157, Fair Value Measurements). The standard defines fair value, establishes a framework for measuring fair value in generally accepted accounting principles, and expands disclosures about fair value measurements. It emphasizes that fair value is a market-based measurement, not an entity-specific measurement. Fair value measurement should be determined based on the assumptions that market participants would use in pricing an asset or liability. Effective January1, 2008, the Company adopted ASC 820 (SFAS No. 157). As permitted by ASC 820-10 (FSP No.157-2), the Company elected to defer the effective date of the standard as it pertains to measurement and disclosures about the fair value of non-financial assets and liabilities made on a nonrecurring basis. The Company has adopted the recognition provisions for non-financial assets and liabilities as of January1, 2009. See Note 3. In April2009, the FASB issued three FSPs intended to provide additional application guidance and enhance disclosures regarding fair value measurements and impairments of securities. The FSPs are effective for interim and annual periods ending after June15, 2009. ASC 825-10 (FSP No.107-1 and APB No.28-1), Interim Disclosures about Fair Value of Financial Instruments, expands the fair value disclosures required for all financial instruments within the scope of SFAS No.107 to interim periods. ASC 820-10 (FSP No.157-4), Determining Fair Value When the Volume and Level of Activity for the Asset or Liability Have Significantly Decreased and Identifying Transactions That Are Not Orderly, which applies to all assets and liabilities, i.e., financial and nonfinancial, reemphasizes that the objective of fair value remains unchanged (i.e., an exit price notion). The FSP provides application guidance on measuring fair value when the volume and level of activity has significantly decreased and identifying transactions that are not orderly. The FSP also emphasizes that an entity cannot presume that an observable transaction price is not orderly even when there has been a significant decline in the volume and level of activity. ASC 320-10 (FSP |
Financial and Other Derivative
Financial and Other Derivative Instruments and Fair Value | |
9 Months Ended
Sep. 30, 2009 USD / shares | |
Financial And Other Derivative Instruments And Fair Value [Abstract] | |
FINANCIAL AND OTHER DERIVATIVE INSTRUMENTS AND FAIR VALUE | NOTE 3 FINANCIAL AND OTHER DERIVATIVE INSTRUMENTS AND FAIR VALUE Financial and Other Derivative Instruments The Company recognizes all derivatives on the Consolidated Statement of Financial Position at their fair value unless they qualify for certain scope exceptions, including normal purchases and normal sales exception. Further, derivatives that qualify and are designated for hedge accounting are classified as either hedges of a forecasted transaction or the variability of cash flows to be received or paid related to a recognized asset or liability (cash flow hedge), or as hedges of the fair value of a recognized asset or liability or of an unrecognized firm commitment (fair value hedge). For cash flow hedges, the portion of the derivative gain or loss that is effective in offsetting the change in the value of the underlying exposure is deferred in Accumulated other comprehensive income and later reclassified into earnings when the underlying transaction occurs. For fair value hedges, changes in fair values for both the derivative and the underlying hedged exposure are recognized in earnings each period. Gains and losses from the ineffective portion of any hedge are recognized in earnings immediately. For derivatives that do not qualify or are not designated for hedge accounting, changes in the fair value are recognized in earnings each period. The Companys primary market risk exposure is associated with commodity prices, credit, interest rates and foreign currency. The Company has risk management policies to monitor and manage market risks. The Company uses derivative instruments to manage some of the exposure. The Company uses derivative instruments for trading purposes in its Energy Trading segment and the coal marketing activities of its Power and Industrial Projects segment. Contracts the Company typically classifies as derivative instruments include power, gas, oil and certain coal forwards, futures, options and swaps, and foreign currency contracts. Items not generally classified as derivatives include proprietary gas inventory, gas storage and transportation arrangements, and gas and oil reserves. The fair value of all derivatives is included in Derivative assets or liabilities on the Consolidated Statements of Financial Position. Utility Operations Detroit Edison Detroit Edison generates, purchases, distributes and sells electricity. Detroit Edison uses forward energy and capacity contracts to manage changes in the price of electricity and fuel. Substantially all of these contracts meet the normal purchases and sales exemption and are therefore accounted for under the accrual method. Other derivative contracts are recoverable through the PSCR mechanism when realized. This results in the deferral of unrealized gains and losses as Regulatory assets or liabilities, until realized. MichCon MichCon purchases, stores, transports and distributes natural gas and sells storage and transportation capacity. MichCon has fixed-priced contracts for portions of its expected gas supply requirements through 2013. These gas-supply contracts are designated and qualify for the normal purchases and sales exemption and are |
Disposals and Discontinued Oper
Disposals and Discontinued Operations | |
9 Months Ended
Sep. 30, 2009 USD / shares | |
Disposals And Discontinued Operations [Abstract] | |
DISPOSALS AND DISCONTINUED OPERATIONS | NOTE 4 DISPOSALS AND DISCONTINUED OPERATIONS Sale of Interest in Barnett Shale Properties In 2008, the Company sold a portion of its Barnett shale properties for gross proceeds of approximately $260million. The Company recognized a gain of $128million ($80million after-tax) on the sale in the nine months ended September30, 2008. Synthetic Fuel Business Due to the expiration of synfuel production tax credits in 2007, the Synthetic Fuel business ceased operations and was classified as a discontinued operation as of December31, 2007. The favorable impact of reserve adjustments for the final phase-out percentage of approximately $32million, the final settlement of other miscellaneous assets and liabilities and related tax impacts resulted in net income of $20million for the first nine months of 2008. The Company has provided certain guarantees and indemnities in conjunction with the sales of interests in its synfuel facilities. The guarantees cover potential tax-related obligations and will survive until 90days after expiration of all applicable statutes of limitations. The Company estimates that its maximum potential liability under these guarantees at September30, 2009 is $2.9 billion. |
Regulatory Matters
Regulatory Matters | |
9 Months Ended
Sep. 30, 2009 USD / shares | |
Regulatory Matters [Abstract] | |
REGULATORY MATTERS | NOTE 5 REGULATORY MATTERS 2009 Electric Rate Case Filing Detroit Edison filed a general rate case on January26, 2009 based on a twelve months ended June 2008 historical test year. The filing with the MPSC requested a $378million, or 8.1percent average increase in Detroit Edisons annual revenues for the twelve months ended June30, 2010 projected test year. The requested $378million increase in revenues is required to recover the increased costs associated with environmental compliance, operation and maintenance of the Companys electric distribution system and generation plants, customer uncollectible accounts, inflation, the capital costs of plant additions and the reduction in territory sales. In addition, Detroit Edisons filing made, among other requests, the following proposals: Continued progress toward correcting the existing rate structure to more accurately reflect the actual cost of providing service to business customers; Continued application of an adjustment mechanism to enable the Company to address the costs associated with retail electric customers migrating to and from Detroit Edisons full service retail electric tariff service; Application of an uncollectible expense true-up mechanism based on the $87million expense level of uncollectible expenses that occurred during the 12month period ended June2008; Continued application of the storm restoration expense recovery mechanism and modification to the line clearance expense recovery mechanism; and Implementation of a revenue decoupling mechanism. Revenue decoupling is an adjustment mechanism that would provide revenues consistent with the allowed revenue requirement with a periodic adjustment for changes in sales levels. Pursuant to an MPSC order issued May26, 2009, Detroit Edison filed proposed tariffs on June26, 2009 to implement $280million of its requested annual increase on July26, 2009. On July16, 2009, the MPSC issued an order requiring Detroit Edison to implement the increase by applying the rate design reflected in its January26, 2009 application. This increase will remain in place until a final order is issued by the MPSC, which is expected in January2010. Detroit Edison recorded approximately $40million of increased revenues in the third quarter of 2009 as a result of the self-implemented rates. If the final rate case order does not support the self-implemented rate increase, Detroit Edison must refund the difference with interest. We have assessed whether a refund will be likely in accordance with the requirements of ASC 450-20 Loss Contingencies and believe that it is reasonably possible, but not probable, that Detroit Edison will be required to refund some or all of its self-implemented rate increase and therefore have not recorded a refund liability as of September 30, 2009. Renewable Energy Plan In March2009, Detroit Edison filed its Renewable Energy Plan with the MPSC as required under 2008 PA 295. The Renewable Energy Plan application requests authority to recover approximately $35 million of additional revenue in 2009. The proposed revenue increase is necessary in order to properly implement |
Common Stock and Earnings Per S
Common Stock and Earnings Per Share | |
9 Months Ended
Sep. 30, 2009 USD / shares | |
Common Stock and Earnings Per Share [Abstract] | |
COMMON STOCK AND EARNINGS PER SHARE | NOTE 6 COMMON STOCK AND EARNINGS PER SHARE The Company reports both basic and diluted earnings per share. The calculation of diluted earnings per share assumes the issuance of potentially dilutive common shares outstanding during the period from the exercise of stock options. Effective January1, 2009, the adoption of new accounting requirements clarifying the definition of participating securities to be included in the earnings per share calculation had the effect of reducing previously reported 2008 amounts for basic and diluted earnings per share by $.02 and $.01, respectively. A reconciliation of both calculations is presented in the following table as of September30: Three Months Nine Months Ended September 30 Ended September 30 (in Millions, except per share amounts) 2009 2008 2009 2008 Basic Earnings per Share Net income attributable to DTE Energy Company $ 158 $ 177 $ 419 $ 417 Average number of common shares outstanding 165 163 164 163 Weighted average net restricted shares outstanding 1 1 1 1 Dividends paid to common shares $ 87 $ 86 $ 259 $ 258 Dividends paid to net restricted shares 2 1 Total distributed earnings $ 87 $ 86 $ 261 $ 259 Net income less distributed earnings $ 71 $ 91 $ 158 $ 158 Distributed (dividends per common share) $ .53 $ .53 $ 1.59 $ 1.59 Undistributed .43 .55 .96 .96 Total Basic Earnings per Common Share $ .96 $ 1.08 $ 2.55 $ 2.55 Diluted Earnings per Share Net income attributable to DTE Energy Company $ 158 $ 177 $ 419 $ 417 Average number of common shares outstanding 165 163 164 163 Average incremental shares from assumed exercise of options Common shares for dilutive calculation 165 163 164 163 Weighted average net restricted shares outstanding 1 1 1 1 Dividends paid to common shares $ 87 $ 86 $ 259 $ 258 Dividends paid to net restricted shares 2 1 Three Months Nine Months Ended September 30 Ended September 30 (in Millions, except per share amounts) 2009 2008 2009 2008 Total distributed earnings $ 87 $ 86 $ 261 $ 259 Net income less distributed earnings $ 71 $ 91 $ 158 $ 158 Di |
Long Term Debt
Long Term Debt | |
9 Months Ended
Sep. 30, 2009 USD / shares | |
Long Term Debt Notes [Abstract] | |
LONG-TERM DEBT | NOTE 7 LONG-TERM DEBT Debt Issuances In 2009, the Company has issued or remarketed the following long-term debt: (in Millions) Company Month Issued Type Interest Rate Maturity Amount Detroit Edison April Tax-Exempt Revenue Bonds (1)(2) 6.00 % 2036 $ 69 DTE Energy May Senior Notes (3) 7.625 % 2014 300 Detroit Edison June Tax-Exempt Revenue Bonds (1)(4) 5.625 % 2020 32 Detroit Edison June Tax-Exempt Revenue Bonds (1)(5) 5.25 % 2029 60 Detroit Edison June Tax-Exempt Revenue Bonds (1)(6) 5.50 % 2029 59 $ 520 (1) Detroit Edison Tax-Exempt Revenue Bonds are issued by a public body that loans the proceeds to Detroit Edison on terms substantially mirroring the Revenue Bonds. (2) Proceeds were used to refund existing Tax-Exempt Revenue Bonds. (3) Proceeds were used to repay short-term borrowings. (4) These Tax-Exempt Revenue Bonds were converted from a variable rate mode and remarketed in a fixed rate mode to maturity. (5) These Tax-Exempt Revenue Bonds were converted from a variable rate mode and remarketed in a fixed rate mode with a five-year mandatory put. (6) These Tax-Exempt Revenue Bonds were converted from a variable rate mode and remarketed in a fixed rate mode with a seven-year mandatory put. Debt Retirements and Redemptions In 2009, the following debt has been retired, through optional redemption or payment at maturity: (in Millions) Company Month Retired Type Interest Rate Maturity Amount Detroit Edison April Tax-Exempt Revenue Bonds (1) Variable 2036 $ 69 DTE Energy April Senior Notes 6.65 % 2009 200 $ 269 (1) These Tax-Exempt Revenue Bonds were redeemed with the proceeds from the issuance of new Detroit Edison Tax-Exempt Revenue Bonds. |
Short Term Credit Arrangements
Short Term Credit Arrangements and Borrowings | |
9 Months Ended
Sep. 30, 2009 USD / shares | |
Short Term Credit Arrangements And Borrowings [Abstract] | |
SHORT-TERM CREDIT ARRANGEMENTS AND BORROWINGS | NOTE 8 SHORT-TERM CREDIT ARRANGEMENTS AND BORROWINGS DTE Energy and its wholly-owned subsidiaries, Detroit Edison and MichCon, have entered into revolving credit facilities with similar terms. The five-year and two-year revolving credit facilities are with a syndicate of 22 banks and may be used for general corporate borrowings, but are intended to provide liquidity support for each of the companies commercial paper programs. No one bank provides more than 8.5% of the combined credit facilities. Borrowings under the facilities are available at prevailing short-term interest rates. Additionally, DTE Energy, Detroit Edison and MichCon have various other bank loans and facilities. The above agreements require the Company to maintain a debt to total capitalization ratio of no more than 0.65 to 1. DTE Energy, Detroit Edison and MichCon are in compliance with this financial covenant. The availability under these combined facilities at September30, 2009 is shown in the following table: (in Millions) DTE Energy Detroit Edison MichCon Total Five-year unsecured revolving facility, expiring October2010 $ 675 $ 69 $ 181 $ 925 Two-year unsecured revolving facility, expiring April2011 538 212 250 1,000 One-year unsecured letter of credit facility, expiring in November2009 30 30 One-year unsecured letter of credit facility, expiring in June 2010 70 70 Two-year unsecured letter of credit facility, expiring in May2011 50 50 Total credit facilities at September30, 2009 1,363 281 431 2,075 Amounts outstanding at September30, 2009: Commercial paper issuances 205 205 Borrowings Letters of credit 228 228 228 205 433 Net availability at September30, 2009 $ 1,135 $ 281 $ 226 $ 1,642 The Company has other outstanding letters of credit which are not included in the above described facilities totaling approximately $16million which are used for various corporate purposes. In April2009, the Company completed an early renewal of $975million of its syndicated revolving credit facilities before their scheduled expiration in October2009. The new $1billion two-year facility will expire in April2011 and has similar covenants to the prior facility. A new two-year $50million credit facility was completed in April2009 and a new one-year $70million credit facility was completed in June2009. In conjunction with maintaining certain exchange traded risk management positions, the Company may be required to post cash collateral with its clearing agent. At September30, 2009, the Company had a demand financing agreement for up to $120million with its clearing agent. In addition to the amounts shown above, the amount outstanding under this agreement was $7million and $26million at Septemb |
Commitments And Contingencies
Commitments And Contingencies | |
9 Months Ended
Sep. 30, 2009 USD / shares | |
Commitments And Contingencies [Abstract] | |
COMMITMENTS AND CONTINGENCIES | NOTE 9 COMMITMENTS AND CONTINGENCIES Environmental Electric Utility Air Detroit Edison is subject to EPA ozone transport and acid rain regulations that limit power plant emissions of sulfur dioxide and nitrogen oxides. Since 2005, EPA and the State of Michigan issued additional emission reduction regulations and continue to develop additional rules and emission standards relating to ozone, fine particulate, regional haze and mercury air pollution. The new rules will lead to additional controls on fossil-fueled power plants to reduce nitrogen oxide, sulfur dioxide and mercury emissions. To comply with these requirements, Detroit Edison has spent approximately $1.4billion through 2008. The Company estimates Detroit Edisons future undiscounted capital expenditures at up to approximately $100million in 2009 and up to approximately $2.3billion of additional capital expenditures through 2019 based on current regulations. In July2009, DTE Energy received a Notice of Violation/Finding of Violation (NOV/FOV) from the EPA alleging, among other things, that five Detroit Edison power plants violated New Source Performance standards, Prevention of Significant Deterioration requirements, and Title V operating permit requirements under the Clean Air Act. We believe that the plants identified by the EPA have complied with applicable regulations. Depending upon the outcome of our discussions with the EPA regarding the NOV/FOV, the EPA could bring legal action against Detroit Edison. We could also be required to install additional pollution control equipment at some or all of the power plants in question, engage in Supplemental Environmental Programs, and/or pay fines. We cannot predict the financial impact or outcome of this matter, or the timing of its resolution. Water In response to an EPA regulation, Detroit Edison is required to examine alternatives for reducing the environmental impacts of the cooling water intake structures at several of its facilities. Based on the results of the studies to be conducted over the next several years, Detroit Edison may be required to install additional control technologies to reduce the impacts of the water intakes. Initially, it was estimated that Detroit Edison could incur up to approximately $55million over the four to six years subsequent to 2008 in additional capital expenditures to comply with these requirements. However, a January2007 circuit court decision remanded back to the EPA several provisions of the federal regulation that may result in a delay in compliance dates. The decision also raised the possibility that Detroit Edison may have to install cooling towers at some facilities at a cost substantially greater than was initially estimated for other mitigative technologies. In 2008, the Supreme Court agreed to review the remanded cost-benefit analysis provision of the rule. In April2009, the Supreme Court ruled that a cost-benefit analysis is a permissible provision of the rule. Concurrently, the EPA continues to develop a revised rule, which is expected to be published later in 2009. Landfill Detroit Edison owns and operates a permitted slurry landfill at the Monroe Power Plant to |
Segment Information
Segment Information | |
9 Months Ended
Sep. 30, 2009 USD / shares | |
Segment Information [Abstract] | |
SEGMENT INFORMATION | NOTE 10 SEGMENT INFORMATION The Company sets strategic goals, allocates resources and evaluates performance based on the following structure: Electric Utility The Companys Electric Utility segment consists of Detroit Edison, which is engaged in the generation, purchase, distribution and sale of electricity to approximately 2.2million residential, commercial and industrial customers in southeastern Michigan. Gas Utility The Gas Utility segment consists of MichCon and Citizens. MichCon is engaged in the purchase, storage, transmission, distribution and sale of natural gas to approximately 1.2 million residential, commercial and industrial customers throughout Michigan. A significant portion of the storage and transmission business within MichCon relates to customers who ultimately move the gas to other states and Canada. MichCon also has subsidiaries involved in the gathering, processing and transmission of natural gas in northern Michigan. Citizens distributes natural gas in Adrian, Michigan to approximately 17,000 customers. Non-utility Operations Gas Midstream consists of gas pipelines and storage businesses; Unconventional Gas Production is engaged in unconventional gas project development and production; Power and Industrial Projects is comprised primarily of projects that deliver energy and utility-type products and services to industrial, commercial and institutional customers, biomass energy projects and coal transportation and marketing; and Energy Trading primarily consists of energy marketing and trading operations. Corporate Other, includes various holding company activities, holds certain non-utility debt and energy-related investments. The income tax provisions or benefits of DTE Energys subsidiaries are determined on an individual company basis and recognize the tax benefit of production tax credits and net operating losses. The subsidiaries record income tax payable to or receivable from DTE Energy resulting from the inclusion of its taxable income or loss in DTE Energys consolidated federal tax return. Inter-segment billing for goods and services exchanged between segments is based upon tariffed or market-based prices of the provider and primarily consists of power sales, gas sales and coal transportation services in the following segments: Three Months Ended Nine Months Ended September 30 September 30 (in Millions) 2009 2008 2009 2008 Electric Utility $ 8 $ 5 $ 22 $ 11 Gas Utility 3 6 Gas Midstream 1 2 4 7 Unconventional Gas Production Power and Industrial Projects 10 8 7 17 Energy Trading 17 24 70 96 Corporate Other (17 ) (18 ) (56 ) (60 ) $ 19 $ 24 $ 47 $ 77 Financial data of the business segments follows: Three Months Ended Nine Months Ended September 30 September 30 (in Millions) 2009 |