Earnings call transcript Q1 2023

Due to licensing restrictions, you must log in to view earnings call transcripts.

Operator

Thank you for standing by and welcome to the DTE Energy First Quarter 2023 Earnings Conference Call. All lines have been placed on mute to prevent any background noise. After the speakers' remarks, there will be a question-and-answer session. [Operator Instructions] And finally, I would like to advise all participants that this call is being recorded. Thank you.

welcome conference. Director to to Investor like the begin now Barbara of Tuckfield, Relations I'd to over Barbara, you.

Barbara Tuckfield

and you, Thank good morning, everyone.

Before to remind harbor I forward-looking statements. would read reference including started, X safe presentation, Page statement we the on to the the you get to of like

Norcia, Our includes the morning to earnings operating operating provided in references President earnings, non-GAAP this is a Chairman, GAAP presentation measure. reconciliation Please and CFO. Jerry Senior of With CEO also appendix. are us President financial Vice refer to Dave which to and the earnings Ruud, and

And to call the turn now, this I'll it Jerry to over morning. start

Jerry Norcia

provide Thanks, provide up the our robust thanks give plan. the an for our on Barbara, plans I'll XXXX And Dave long-term your an will made discuss overview update before morning, wrap achievements we morning and financial everyone. joining we targets us. year so and update opportunities to good things on questions. achieve our and This have a take in this far

X major impact on power worked which with experienced starting and we the Let on storm in understand me We the by around storms the during to our quarter safely. to worst followed a nearly power immediately clock discuss XX back first was ice in to years customers the snowstorm. the the team start outages Slide get

for efforts, appreciation along express these DTE efforts. to who partners my hands was restoration all on their others to labor with the storms. large our deck It of employees and tireless our want supported I many DTE two and our for at all community

conducting power assessments. and our front had line We ice through dangerous damage snowstorm restoring conditions, and working

public downed in also the staff field office We safety our from ensuring wires. had

going sure were Gas door-to-door, vulnerable to of customers on make and okay. they checking team thousands seniors was Our

matters. escalate call center information the tirelessly emergency agents to worked customers, and provide latest Our

communities customers and keeping I grateful showed each up am our team our for safe. and our for by really proud other how

Our $X through a food big way stores. at customers in contributing reaching foundation out Way grocery also United provide vouchers by replenish low-income to local and food million to showed up pantries with

and We of stakeholders communities is success as of the always employee for delivering say engagement to the remain team including committed our drives DTE. that employees, I levels shareholders. secret continues by and decile supporting top our our and And engagement operate to sauce Gallup organization. measured customers, a all

engagement communities to for the consecutive excited Workplace I'm say, launch energy recognized we by companies our we to African-American Great XXth to Academy. for and Efficiency top the Energy continue with the supporting the one partnered were efficiency effort women-owned our In Award Gallup largest recently of this earning year. country's

energy building academy we customers' training jobs front XXXX achieve And more provides guidance our and and of executing are make pipeline placement efficient. paying a for homes, investor long-term help our will that The financial our growth. the on on talent good to our plan

the I As we the headwinds you additional that and are storms severe with warm mentioned. know weather facing

our continuous businesses. The portfolio cost on one-time efforts find we our with improvement and to the team work has of continue progress savings and made across initiatives management excellent

We operating are X%. long-term deliver EPS with growth premium X% well known is the positioned for to to growth that strong performance DTE continue of and to

X continue Slide frequency. and Let's in turn increase extreme to discuss that events the to weather

storms with new has becoming historic weather Michigan's aware, normal. are dramatically in seemingly that considered were you the once changed As recent years

we faced we experienced two-week the year a ever storm as this Earlier company. challenging period most have

week. ice our largest the that through was The in was event wet in snow years. rolled storm XX area by a first It followed the storm heavy following

investments is really to we the well up have XX% our the significant And in to through system storm having ice extremely vast majority the event. hold grid the so mentioned, I far. very As made storm a of XX% or a the was tribute

We've invested substations. poles rebuild $X.X transformers and to over last years wires five the billion

million trimming also and $XXX in have tree last results invested over these the from over five great We years investments. see we

to we will that be from are affordable impact It We these our we plan implement safe reducing our provide that and of more a storms intense continue implementing learnings bolder to to approach these need energy. weather is events. important the in reliable

expectation. we Our have from customers infrastructure achieved investments. this this can expect us And through and the be only same

and it development. of is critical stakeholders Having all statewide and that decarbonization, a electrification well our faster. resilient as to providing we with well must more as to safe as agree do together we work transportation reliable enabling We achieving as electricity, do grid economic must and promoting

been have know We while the are at to impact strategic having are ahead. challenges and to ramping and the up investments that accelerate opportunities we for looking prepare efforts, positive our affordability. maintaining We investments ways a our customer the system

to completed electrification our of the customers investment economic up long-term and from Significant in where work weather In and to demand our increased DTE grid's a prepare communities is improvement infrastructure, XX% infrastructure some extreme most experienced development. focused needed for challenged for reliability. more on

is to investments to strategic continue focus make Our grid. in our

to of these opportunities. some to slide six turn Let's discuss

heavily of back early infrastructure, XXXXs. the We have on grid focusing our in grid over rebuilding invested hardening replacing originated the aging years, and parts equipment electric completely in the that

see must want that type data the we areas can see investments these where system, improvement But our dramatic make do across we of more. You to improvements. entire we from reliability in see we the all

to the the over $X We a will in strategy. through harden further grid system invest years five the focused next billion

outages to the majority First, we'll customer wires. enhance tree and continue to know invest due trees contacting We trimming. are that of

those areas trimmed. know better not trimmed perform than are significantly trees We that where also

more the continue grid, and hardening specifically that maintenance the Second, wires and other updating we reliable more the resilient. electric existing equipment continue will infrastructure preventive on and poles, system and makes

most two system. we rate accelerate older In will pilots. our complete our recent pursue our Third, we of of the instances, In the to requested it make of will undergrounding some infrastructure. sections rebuild case, sense the distribution undergrounding

with and drive been wires down system underground. underground has on our to is of now new system electrical continue XXXXs work a-third with important significant developed the There a cost this our undergrounding. early opportunity of the Since construction

Lastly, the reduce to of work duration fundamentally the grid achieve automation the we outages. will of electric full our which accelerate will

distribution on plan be line improve to the customers the grid the same with Our XXXX rebuild, this accelerated must in near envisioned performance the time the the of filed in work term. happening grid as for our MPSC but automation the

will With circuit, the can our so our an recent minimized. quickly being system smart on complete, advanced can operations distribution and technologies which investments be efficiently us and of to grid a now management outage the system more field, impact we outages new into enable isolate the center bring in

Our five goal years. to automate the is fully to grid within six

years. in continue opportunities our provide accelerate We have how investments investments we investment to done are to to while over know our consistently we something and Increasing the important evaluate maintaining clean And reliable affordability. will power these system is customers. to

slide let's turn Now to X.

are rate at are continue At We each progress. case. process we IRP year. DTE continue We units the rate discovery very great making with audit proceedings the began progress case to business constructive settlement Electric, the of and IRP, which our in and and the on this discussions

operational. This continued power its successful more wind energy DTE program highly The of addition with announced recently is generates townships. is has on Electric XX,XXX Michigan's XXX-megawatt park voluntary enough the wind a park than homes. Park spanning Wind to XX-year XX progress and We three that now largest recent the wind renewables turbines Meridian clean contract with Toyota.

Henry a We development territory. Detroit growth billion research area. Health Ford for facility some in will in planning in drive New is expansion, our continue hospital service are promising to and a $X.X in ongoing redevelopment Detroit's seeing economic neighborhood which the state, System Center investment

a headquarters. Michigan The development research a campus billion downtown an including and that will of our firms across These will Ilitch commitment $X.X take for innovation organization investment Detroit University and a innovation together. adjacent for to place the developments announced bring

We meaningful the businesses see supply pickup and to with content in our storage potential a under service in the benefit within domestic from translate chain order should solar requirements load and comply IRA. higher manufacturing critical in also manufacturing Such energy-intensive including to battery into domestic manufacturing territory. growth areas, expect

energy will bringing a is full-size A GM maker by recent Orion produce territory. to its support to convert rate next service our trucks. located of is our our in potential XX to directly plant billion this electric ability EV $X And These developments example new assembly deploy battery is investing impacts increase our Township megawatts of mitigating customer system. pickup of on while more capital, demand that

a for customers. has also which providing Vantage customized positive our More and this industrial for solutions business commercial is energy expertise broadly, in

We activity are seeing in line. and this business potential increased

progress XXX end on target miles gas XX Gas, to of of transmission miles year over the in the continuing we completing DTE of main of modernization Moving the system. by over the renewal with accelerating a completed

is of project company final major installation facilities, completion Another a gas accomplishment Michigan. of provide included project in growing Northern the supply to the This modification of our redundancy and the new major pipe a for work market. renewal for transmission phase

custom to and DTE pipeline on project in we RNG and RNG energy projects. development a large both project Vantage in solutions progress a driven custom and plan energy solutions new with conversions growth a continue service our by strong

a With that, to I'll to to turn financial you. over Dave, update. give you it Dave over

Dave Ruud

Thanks, Jerry everyone. and good morning,

$X.XX were on our per financial the translates results. This Operating me first $XXX earnings review quarter slide quarter Let X to into for share. start million.

segment by our in find reconciliation can including You EPS to the of GAAP appendix. earnings detailed a reported breakdown

the with main Electric the is experienced lower is significant start described. than $XXX of I'll top we the of the Jerry of that the driver XXXX. restoration from first $XXX the that million expense utilities. The at events earnings DTE quarter. earnings storm our quarter variance This were review the the for million page

sales were with weather impacted The XXXX with to of and work. also consistent experienced lower We're returning warmer to sales people we by the our continuation relative forecast.

and amortization XXXX. that higher partially the tax year we implementation reductions had onetime the discussed call. all quarter cost offset O&M accelerated in base the also was deferred end of This our by rate We on costs in

were O&M also resulting DTE base XXXX. The rate earnings than in by also and at first decrease to quarter was on offset Moving quarter-over-quarter the over a higher variance of of to had costs significant was due million a weather driven on lower earnings gas $XX $XX earnings $XXX million impact million, expenses. lower weather. company operating the by partially Gas, Warm

row. last were first the higher Operating the to DTE our year, Vantage of $XX a earnings Let's renewables the third first $XX primarily to is increase quarter from in million XXXX. earnings million from on This due plants. move quarter

see On row can quarter the the you finished loss. million with next a $XX Energy Trading

quarter on with the call. the consistent year-end result is first we The estimate provided

execution. then fixed prices on and power our term the upon then due is As the transactions I to included physical based over mentioned contracts revenue transaction that in are this the primarily these business hedged of

the energy revenue in for of energy does February. unwind not the is on while vary through This price recognition we cost fixed these The month-to-month curve, and remainder based the the variance timing year. the of received energy recognized higher contracts of will in is January which

confident We feel segment continue this year. about performance to in the this

to other due by DTE quarter. taxes per interest Finally, primarily $X favorable the $X.XX in the quarter-over-quarter was timing earned corporate first of Overall, and million expense. offset share higher

slide to our to turn X Let's discuss XXXX guidance.

slide, to from units. added As and other show Electric to show in business experiencing arrows year that the green the red opportunity we are you we is arrow DTE seeing that incremental headwinds can this a see

X% original portfolio strong provides XXXX EPS growth guidance of $X.XX place to plans have Given we total operating share, achieve our from the midpoint. per our guidance midpoint in of which businesses,

business for during I'll DTE activity. first storm one have headwind DTE quarter a of certain with standard contingency the supported storms the level weather also are each O&M our our the starting deviation We do to year-end by Earnings of weather I and from for a at The described onetime call. Electric. budget and for reductions are Electric. we did outlook discuss drivers unit

electric the with As we the levels and weather and restoration budget the weather storm for variance warmer have I storms costs year. we've unfavorable for company weather. at storm budgeted experienced The consumed catastrophic for restoration the mentioned combined normal than

averages historical weather For the and storms. assuming for of the remainder year, we're

to segment we're headwinds and sales. Gas impacted performance seeing at year Vantage Electric, this Offsetting Trading. focused and but the warm DTE anticipate customer Energy higher DTE onetime as we well, weather was DTE given stronger contingency by weather the the also for the at initiatives, stronger Gas earnings

already secured likely For earnings DTE of year the online. we'll in back year-end see call we the the slightly new come Vantage, on half stronger as mentioned projects

favorability of is stronger in that we to favorability our business experienced the the unwind Additionally, for this Trading, performance this the power as see year the In additional the first business. hedged projected remainder of unit. our supporting through portfolio timing Energy contracted, quarter projects will in upside provides variance highly

our place find long-term we to first overcome have in our opportunities experienced plans achieve XXXX and we growth. the quarter that guidance storm as the to well-positioned we across weather we achieve our impacts in Overall, and to remain portfolio

Let slide XX through summary, then year, In me questions. on open to of customers, wrap up and the for DTE team, will line on continue investors. the we'll the focus communities, remainder our

warmer are plan quarter, the to we normal than storms safety on without jeopardizing in first we experienced reliability. Although year our and weather achieve executing full guidance and severe

on we generation strong increase capital customers deliver to to that robust execute affordability. our long-term as Our focusing on the investment plan our we customer EPS critical while supports need cleaner make operating growth reliability for and

through rate with and XXXX provides near X% our dividend operating supports EPS in EPS. line and a growth to long-term Our plan growing X% operating

us With we can today that, you joining line questions. for and open I the thank for

Operator

Thank thank Chopra And from Instructions] for the ISI. question you you Evercore Durgesh your line Jerry of comes and [Operator presentation. first from Dave, the

Your open. line is

Durgesh Chopra

good thank and team my Hey, you morning, question. taking for

Jerry Norcia

Good morning.

Durgesh Chopra

you morning us good clearly expenses headwind very much the a out were how EPS sense year the just slides. quarter? of can Jerry. give in storm Hey, this Dave, on a broken first impact is the Maybe of weather

Dave Ruud

weather Like headwinds $XX storm Sure. we in from the -- quarter and in we electric at was and our is -- from both said, there it did in million. the first see storm business

heavier of O&M. hit of wire, was We one it little kind this heavy a was -- a lot where also storm so a it our

is year doing of million. $XX the reductions been So all focused we headwinds. through But those the reduction really after other again, has work And and opportunity our businesses to in kind great see of too. through overcome that kind been around cost we've tax coming again,

see guidance. normal these So with able reach through storms great We still to beginning we've headwinds the weather to the the in and end of this. our year. through be work had opportunities of year And the

Durgesh Chopra

Got it. your up protecting plan to guys sort may you kind you you much And comment on as Can and the -- building are begins. of at much contingency on have mean room then of comment have I you and flex used maybe pretty up good the you how year just how before progresses? can contingency year may

Dave Ruud

Yes.

the pretty quarter The first weather came some We and year talked with were the impactful. storm challenges. just we into about

we some our storm some the with offset year that. management normal through actions need So developed and and we'll the end of need guidance. to of But normal weather storm along weather hit to

Durgesh Chopra

Can and very one helpful. sales one. That's of you're weather-normalized the How compare sort Perfect. And that in XX? just on that slide compare does contrast last contrast showing maybe residential was you case. And over mean in quarter to this case rate residential pretty X.X% last I I know last a filing? on quarter decline that's your sales front. trends steep an the rate issue the

Dave Ruud

Yes.

really to had well. see close in will the think the have expected that first they're -- and rate in that off as work the had of budget, we just what what had we're people come the to through case forecasting in current we but sales they're we a Our line our with little in quicker returning that We year. quarter end in will that did than balance we

case rate very our we a consistent it's what this what rate had in is filed below even. previous what saw and So little we case in with

Durgesh Chopra

Appreciate guys. Thanks so much, again.

Operator

comes question from Tonet of line JPMorgan. the Jeremy next Your from

open. is line Your

Jeremy Tonet

Hi. Good morning.

Dave Ruud

Jeremy. morning, Good

Jerry Norcia

Jeremy. Hi,

Jeremy Tonet

I contingencies just to of bit want to finer bring maybe little a question here. a point on

or the go still Does the adverse you've place to balance of target year are across As exhausted segments, should contingencies assume the that contingencies for in see there year midpoint about you something of plan? talked the EPS. you the for kind

Dave Ruud

for Well, contingency we've worked electric for storm and have that the through our business, at weather we combined.

that our within through but -- we continue to for So as make favorability other seeing we can that businesses are the go still year. up

Jerry Norcia

some are this those efforts, $X.X more touched levels cost have we about both our the favorability impactful budgets, trimming we year, we'll distribution other to be well, are continuous to tree just through And them on and seeing be on not that we for reduction at And improvement efforts to will embarked line, do seeing of everybody and reduction reliable. year well, two which we combined as as helpful. billion initiated also one-time investing our of we we're are clear record these The invest Jeremy, more in in our which move This which resilient we thing our will as grid. efforts as most are most the cost our there grid. also things grid efforts make

Jeremy Tonet

helpful. That's it. Got

Electric be in are something that to there outside in could other to that adverse still So are clear should not that of plan be contingencies this the yet plan point? could just move there at segments, used

Dave Ruud

Yes.

yes, there's that what that is those within So offset signaled can we've they businesses favorability that's things. other

Jeremy Tonet

That's the pivoting of very guess kind just helpful Got it. RNG within Vantage. there. And business away then I to

Just of wondering talk set competition. you see see if a bit you there how kind you opportunity the about if could higher

how about Just at you think wondering this and point. opportunity returns set

Jerry Norcia

Yes. assets produce already are we're RNG that Primarily to our are driven control RNG. in converting investment by opportunities existing landfills our under where

IRRs seeing And in so we're And some sort and of teens nice unlevered XX% still in are instances that's really of into where that the returns, north the are those after-tax. opportunities.

in industrial We're with us where of we're us. So at Solutions those the opportunity of – States look seeing given to United in our repatriation Energy feel our large of sort activity real investments lot a some of a partners. also the has good to resurgence area industrial incremental

So about line business. excited that of we're also

Jeremy Tonet

I’ll That’s there. Thank helpful. leave it very you.

Operator

from Morgan Arcaro the Stanley. question comes line next David of Your from

Your line is open.

David Arcaro

taking my so Good morning. much question. Thanks for

Jerry Norcia

morning. Good

Dave Ruud

Hey, David.

David Arcaro

any a just either going rate that a the or strategy to overall appealing? just within regulatory or see is would if end there's case forward to your appetite be through that wanted or state just pursue structure I decoupling a from

Jerry Norcia

a area Traditionally adopted widely or the endorsed. even in in that's our that's not been been Midwest, practice

see don't as that a we So outcome. high probability

because We point have for this not in asked it's at time. something be it that for seems not appetite to there

David Arcaro

onetime offset Is too your curious you forward Got of it understood. obviously onetime any onetime that reversing was on cuts And or XXXX? the certain year to if there's view natural this get being XXXX you this you you forward on year? are risk thinking I such a headwind them going dig level kind – as there about the initiatives of pursue into going deep thinking savings

Jerry Norcia

of one-time to Well, be again that's do as continuous stick. are the have reversed. much reliability impact will certainly, you not will make improvement know these not And continuous how that one-time reductions through always Obviously, significant we to on initiatives reductions clear see you And of and would for we're safety. just be look initiatives to areas initiatives. find improvement one can more our these that on that through our operations you looking And any opportunity. efficient something embark our time certainly

look we'll improvement all those but stick will many at make initiatives continuous reversed. to will So of of be – if be them try some and

David Arcaro

I I'm number expect or obviously understood. time? if type that resiliency more something – it's or the wondering, case a you've was some separate you would initiative to O&M are more could weather it through in traditional bring plan of how you've the laid how to it go undergrounding whether just as wondering out over to pursuits Michigan. of Got CapEx Yes. of that a kind strategically targeting. whether commission you kind process extreme rate you kind a in Is this the facing thinking of manage been about of plan,

Jerry Norcia

we're processes facing you realities this happening storms more years, have five do One our XXX be that. plan have be as three process great is grid happened and reality. have several we used years our we become to for frequent commission so every doing And the a update to every investments. and One have or now in grid every to to that really is we what of said, one that's historic seem XX years year, the Well, two that's question. distribution

electric especially facing and reality that got with also transportation our second is levels industry electrification in seeing, that demand would we've what starts And the growth fleet. high to development significant we're to call auto rebuild retool state, the the vehicles. of The build as I opportunity of we're economic

going So really think XX-year XX- we and five-year right five-year And out. when plan grid. several billion fundamental plans projecting and now about we One really things there's and going areas. that is approximately is the investment all into of think about forward, three come $X our our plan of

rebuild system. continued One hardening. kV X.X system our voltage full is lower grid the of Also our

need approximately our is XX,XXX It in of kV miles and of the have is rebuilt. driven part grid and to by We will grid the our need system X.X that rebuild oldest be for to One electrification accommodate that seeing. and modernize, we're things. as secondly, the sector, the several economic but also is incremental through as activity transportation ability age need to of the demand the well development

So pursuing is that's of so full those Number accelerate we seeing frequent we XX period our more five that six of basis, on which a full with to to to years. of automation reality number But want years, the this that we're activity over the three, automation were storm rebuild the to grid. are -- new XX two.

that's if last make pace course, a in for where is, invested And return tree level to the the at the we're over more a years two move tree will. years, most term. five program removed the we've outages aggressive do backlog continue improvement more will normal in trim, it of then to tree we're million we'll and the And where and fundamentally duration we've you $XXX of sort trimming pace of of aggressive once tree-trimming making need years trim. that we'll seven-year investment very near that our in of we through grid the What that will in five

formulate get in things the are obviously, forward. as our grid fundamental the that, distribution cases and endorsement And going that plan. then those will we rate that basis see our you'll So support for of

Michigan. distribution process a -- around we rate our to out and year, we -- we We're alignment So take in plan plan get in then piece here grid that it's you our each if of a good will very attempt cases.

David Arcaro

so all Okay. Great. color. much the Thanks for

Operator

question from next your of Research. the Sullivan comes from And Instructions] line Michael Wolfe [Operator

line open. is Your

Michael Sullivan

guys, last into there some reliability then on that Hey or just maybe you're and of kind do so things any gets grid can cases? fold into have future one. spend currently good it to Jerry, on factored the pending electric till picking about be way rate morning. Is this the wait up of thinking case, filed distribution plan you

Jerry Norcia

is our with we're rate for automation, fundamental We as be some not already The still of Well, that's happy is for in full this of beginning going lag strong mechanism trimming this to is the is there's support forward And pull renewal start we're case. X.X tree that of front the infrastructure in but anyway. The plan our some in that -- we're our rate of but to the of is commission. case. a to in this certainly start it tracking And proposing there the our tracker this think be current regulatory in that part or acceleration rate is grid we investment. capital current kV hardening case, And investments won't in current investment significant. rebuild rate that, the may this that and the case start the actually, rebuild. feel

and much put at this -- going start we're other got And that we're something the can we're on miles get attempt aggressive to grid, possible rebuild economically we to put understand kV to our the that grid as it underground. of We've how feasible. to underground we with. is, way as going Michael should of that's much trying older And to the to of thing going I really XX,XXX I X.X of experimenting mention look rebuild, this portions as wanted

have and infrastructure we're and pilots have Him start I've commission this our in start Duggan. feet replace we Mike Detroit, with talked get that met create will about of are and that how wet. of the Detroit And will here in that case the gas attempt We and that rate actually replace in approve experiment city and we the to to start mayor I with as really with hopeful that that Detroit. water to synergies current to try pipe we some main he renewable several

Michael Sullivan

rate That's Okay. see budget customer thinking shifted other incremental be impacts? Are should get helpful. grid? out on And about how CapEx spend, we really incremental things all like this you maybe of absorb that to or this just headroom the additional spend the there do with just and some

Jerry Norcia

that Well, that to the And our try grid. the deployment. get we've the by inside got we'll billion in feel the going automation. $X more update accelerate at capital years, efficient November in is We're that over to that here likely we'll we five-year billion next modestly to plan. $X.X opportunity we'll this our piece we have but invest in And update -- year will accelerated becoming EEI. with find fundamentally in $X billion But five -- may also to it increase

Michael Sullivan

the Great. back the Okay. just to guide. circle and wanted to I then And last thing quarter results

there business as weather if much So, the it be the do think electric how I guess just or become to over too should that storms much absorbed about can get summer more more or mild we to at to starts confirm offset? we

Jerry Norcia

Well as in here we forward for our budget try to summer. have move we the storm left plan obviously,

get weather any other we Dave, you assumed will add to We and normal put the do look that? for we'll have to cooler-than-normal But weather. want opportunities. color pressure to plan it have If on

Dave Ruud

right. I think that's

some weather have normal. if if good to place storm normal -- in normal have looking we'd the offsets, things hit more and to are our a are We outside we we're again, find guidance. of But

Michael Sullivan

much. very Thanks Okay.

Operator

line the comes of Your question Scotiabank. from Weisel next Andrew from

is line open. Your

Andrew Weisel

you. morning, Thank Good everyone.

Jerry Norcia

Good morning, Andrew.

Dave Ruud

Good morning, Andrew.

Andrew Weisel

reliability come with outages savings I reduce mitigant automation to the and spending pressure? the day-to-day customer expect O&M but structural should is from these investments? on question particular these we would in vol goal primary think First

Jerry Norcia

Yes. question. It's great a

gives you you customers example. poles that As have a both caused sides of between think the is taking just and on tree to restore and to interruption opportunity to wires about a do automation that by outage describe isolate for automation And outage. out falling on quickly, two what it wire you

X,XXX XXX So waiting customers reduce XXX having instead of or perhaps customers that XX impact you to so for or restoration waiting damage XX is can repaired. that

of right will So to duration, Andrew that where to the of outages will it if to outage patrol so the night which starts look that it's costs in if best-in-class, it patrolling quickly. means the you need one restoration. location so that of outage the be more the to improvement be more you of restoration now, And then middle for of to we the you secondly we have industry. can makes efficiencies consumes hours. faster hours that is make there And the points circuit you the properly are the which just Like terms more and that in most and go kill people in could

efforts make efficient restoration lower cost. So will the and more it

Andrew Weisel

the different Great. spending. Okay. few buckets Then of is to a one you mentioned follow-up that reliability

terms the see In of most potential value? or opportunity the dollars do where and impacts, most you

Jerry Norcia

from next ever the miles would is areas. XXXXs the made really anywhere mean, investment be significant will in be if we've which And significant a is that to most grid first the got that XX,XXX the and kV will. was will And this the XX need built grid. I be most modern X.X because built rebuild XXXXs some meaning early another of the in portion is years over and believe kV of getting investment you the our We've is the XX,XXX XX.X the we to is the miles newer one XX I of And two The and top was sure as approximately old system equipment the XX,XXX X.X XX,XXX a that's newer make system, the of in grid well. the circuit is hardened early XXXXs. to to into that XX,XXX total it hardening. secondly And miles here rebuild. times kV

to wires, need replace on, so need we So and so we transformers replace and pole-top equipment to forth. poles

hardening be that big we do. two that. also going But to Those automate the significant the are be need won't and major investment buckets rebuild it and -- So will in automation the grid. as as be of a investment but the to

Andrew Weisel

about fuel helpful. may. That's one, Okay. if one really stands levels? year-end I versus can balances talk that Deferred And last where you just

Dave Ruud

million some year. this year Yeah. collecting We our were be over going has way down. $XXX our PSCR, And were we down last year we GCR then and that to are On about come next year. cash collecting this we're

has come price. gas Our balances way down in

at $X that without like a was So around come into last year it's balance down now there. $X and

Andrew Weisel

All so Thank right. much. you

Operator

next line Mizuho. comes Mortimer Your of the from from question Alex

is Your open. line

Alex Mortimer

the Good Hi. time. Thanks for morning.

Jerry Norcia

Hi, Alex.

Dave Ruud

morning. Good

Alex Mortimer

onetime provide XQ on are kind how thus O&M I Good you on morning. of call going said cuts. million cuts -- O&M color had the that cuts I you far. hoping some the believe about the was could of you $XXX

the number where stand as stand from So activity any things within clarity QX? that given today storm weather on you challenging and

Dave Ruud

our on and We about into question. for a would process that Yeah, setting go that. our well some through that's and budgets targets we're with good the went came and year to challenge normal our that of way we teams and good achieving how

started overachieving limit over our time reduced year. a as we've we're these And of attrition then some -- contractor we've our advantage work. of some shifted workforce and again fact, are little In of taking time-critical bit less the

So Again, very our numbers. that us. doing impacts it's well hitting for really impacts reliability. anything we're customers, We're our going not

invest and business, in hold. In these fact, to across help we're need continuing do take our But reliability. to improve we're like really we lot everything reductions seeing a to

Alex Mortimer

to Understood. Okay. then correct? midpoint And guidance, $XXX that hit is of the million

Dave Ruud

midpoint. hit putting that us to the Yes, was on target

Alex Mortimer

quickly just two current your slightly used lack of of on in revised we extensive then case forecasting forecasting of methodology a seems were in you you've It It methodology a case issues how case would provide be the your you. as could seems in the more this case concerns precedent But rate And testing. big commission it that like past. in kind like work new any to electric if you've rate traditionally you with kind and back Okay. of what appreciated. flipping through this the looks a you intervenor sort of lack last Thank then addressed believe for side. the color aligned direction

Dave Ruud

on we to in we what forecasted of seeing we kind sales last sales the case, what come forecasting. in are the we're Particularly about to fact using coming that below similarly had rate in little a is the had of that. actually data work. you're determine people available That's some methodology mobility back talking change percentage help The us anymore. Google not would And

also data from right we're kind return say forecasting about we a now the a work. what's use we will be case, because would is job. as accurate in through badge-like or but rate good less really on in what we done the lot doing working which We're of So how this just to Kastle. And it's submitted there's forecasting accurate. variability are with our I more But this

so big across there next go be this we we through case. don't the variations rate And forecast groups to in as really expect

Alex Mortimer

definitely the challenging process in of With your the And through more what replacement coming his how Phillips leaves case, more case think clarity months, this should of rate coming of a current it the Yeah, case out? we leaving about get give sort this time front. the I'd then on to finally Commissioner development looks simpler, like one does out sort any commissioners or on makes Understood. of rule if playing halfway on the imagine. MPUC can straightforward you just

Jerry Norcia

is What will and commissioner Yeah. wish her replace future his staff appoint course of Commissioner and best new to governor the Phillips will happen in the we a all Commissioner that endeavors. Phillips

in the would they it's or front course. two But with I depending case company. have on can it. will then enough typically case of what our on rule spend in rate to one have that's proceedings had choose of the timing appointed may If rule yes commission of not not the is the they opportunity late the if time to new both and happen. commissioner do to IRP participate. weigh they typically you And process the the one then question for on So in If that's guess last the

Alex Mortimer

all so good much. quarter. a on Thanks for me. That’s Congrats Okay.

Jerry Norcia

you. Thank

Operator

Fowler the Ross comes line of from Your next question from UBS.

Your line is open.

Ross Fowler

Good morning.

Jerry Norcia

Good morning, Ross.

Ross Fowler

Good morning.

sort look sticks with as So of as and what's year Jerry move back you that O&M have range it. this you of storms. -- what's talked the to the commission to mitigate have Dave, and through to conversation forward some you've well. Obviously, cuts of about reviewing these onetime you get talked the this about in going all and I imagine onetime permanent of sort that as you're what to

context permanent? going look Just and about what's be that a what's that in There's how us we past, conversation some the onetime maybe give forward and right? as debate of to more conversation has into gone color

Jerry Norcia

happening Absolutely. to the and permanent. conversations and what's are are commission understanding as happen And with also create at onetime what's to the those continuing staff to

And addresses So and commission also be and staff. I other but think on O&M, plans investment of decision there not capital it's with will a work our hopefully a here that in forth. structure the Ross, the so features our capital ultimately, settlement and progress, so only -- so returns a and

we're case progressing there. have will to and in hard really be IRP. the But happening what's We work that encouraged we conversations actually settlement hopeful to by in that happen. this we'll make seem We're

with to the going rate approach So take same we're the case.

Ross Fowler

average every happened we has is the look individual on Thanks And taken a proving I general process? happens but guidepost time in this replace sort a a or time then -- Phillips. as for commissioner of different, for a that it's up it's there little to know not should this bit when this like that. to following past, Commissioner the

Jerry Norcia

underway already is on are my the other of understanding, side being and considered. list there's that know -- process there's that is understanding of candidates the a but we're already this, not I my obviously,

we're this. so moving is encouraged quickly by Governor's that on And that the Office

that understanding unless candidate. the they're about put a being that on there's always we as I who they're really the difficulty new encountered So in I think my have And selective would is expect commission. they commissioner that's several they are in would finding months right being --

more of and is the time historic investment historic produce future. of so way deliver of a state way a also the this to much light in for a utilities In time we in the the in energy fact it's and rebuilding transitioning reliable we energy, really terms Michigan that really cleaner terms and

Ross Fowler

great color, you. it’s Yes, Jerry. Thank

Operator

Jerry call for further questions no are I'd to remarks. turn this over back time. closing the There like at to

Jerry Norcia

saying gas. the Well, our really prepare thank to you we transforming system, electric way for power, I'm that joining excited Thank you. further we for strengthen of produce the and us today. electrification for about demand opportunities way as our well grid, deliver just everyone close I'll increased ahead us of have the by we as

at state. in in period DTE a and historic We are our

I goals I weeks. to at our our has hope So and in plan you we a morning, forward will executing look and also a in AGA on remain seeing positioned for XXXX, to you. well growth. Thank everybody future of achieve continue few great all

Operator

call. today's concludes now This conference your Enjoy day.

disconnect. now may You

DTE Energy (DTE) 27 Apr 232023 Q1 Earnings call transcript