Dte Energy Company · NYSE:DTE
Dte Energy — Non-Deal Roadshow (February 2020)
32 slides from Dte Energy's roadshow presentation, Feb 21, 2020
Slide 1: DTE Business Update
DT E B U S I N E SS U P DAT E FEBRUARY 21, 2020 1
Slide 2: Safe Harbor Statement
Safe Harbor Statement Certain information presented herein includes “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995 with respect to the financial condition, results of operations, and businesses of DTE Energy. Words such as “anticipate,” “belie
Slide 3: Continuing track record of delivering premium shareholder returns
Continuing track record of delivering premium shareholder returns Strong operational and financial performance in 1 2019; well-positioned for future growth 5% – 7% operating EPS1 growth through 2024 from 2 2020 base 3 7% dividend growth extended through 20212 Driving utility growth by investing 80%
Slide 4: Environmental, social and governance efforts are key priorities
Environmental, social and governance efforts are key priorities Environmental Net zero carbon emissions by 2050 80% carbon emissions reduction by 2040 80% methane emissions reduction by 2040 Providing renewable natural gas from agricultural waste Social Advancing leadership in diversity Recognized b
Slide 5: Distinctive continuous improvement culture drives strong cost management vs. peer average
Distinctive continuous improvement culture drives strong track record of cost management vs. peer average All 10,000+ employees engaged in CI to Average annual percentage change in surface and solve problems O&M costs 2008 – 2018 Electric utility1 • Controlling costs while improving the customer exp
Slide 6: Consistently earning authorized ROE in a constructive regulatory environment
Consistently earning authorized ROE in a constructive regulatory environment Ranking of U.S. regulatory jurisdictions1 DTE Electric ROE (Michigan in tier 1) Tier 1 8 10.3% 10.3% 10.1% 10.0% 10.0% Tier 2 9 2015 2016 2017 2018 2019 Authorized ROE Earned ROE Tier 3 17 DTE Gas ROE Tier 4 10 Tier 5 7 10.
Slide 7: Delivering premium operating EPS results through disciplined planning and management
Delivering premium operating EPS1 results through disciplined planning and management History of exceeding operating EPS guidance Robust planning Annually create detailed 5-year plan $6.30 Includes earnings contingency across the portfolio $2.90 Weekly detailed executive management review of first 2
Slide 8: Clear line of sight for growth supported by investment in utility infrastructure
Clear line of sight for growth supported by investment in utility infrastructure and disciplined non-utility opportunities (billions) 2020 – 2024 DTE Energy investment $19 billion Electric: Distribution infrastructure, $12 cleaner generation, maintenance $15 Gas: Base infrastructure, main $3 renewal
Slide 9: Potential $2 billion upside to 5-year utility investment plan
Potential $2 billion upside to 5-year utility investment plan with visible infrastructure investment (billions) Utility investment plan $1.0 – $1.5 billion additional electric investments above 5-year plan Additional ~$2 opportunity • Additional voluntary renewables ‒ Current 600 MW plan with long-t
Slide 10: DTE Electric: transformational investments in generation and distribution
DTE Electric: transformational investments in generation and distribution provide customers cleaner, more reliable energy (billions) 2020 – 2024 electric investment Transformational investments Cleaner energy $3 Delivering 80% carbon emissions reduction by 2040 $5 $12 billion Infrastructure renewal
Slide 11: Steady march toward clean, reliable, affordable, home-grown energy
Steady march toward clean, reliable, affordable, home-grown energy Cleaner generation mix 1% 2% 17% 20% 25 – 30% Renewables 18% 20 – 25% Natural gas 20% 77% 20% Nuclear & other 45% 30% Coal 2005 2023E 2030E River St. Trenton Belle Monroe • More than doubling renewable energy by Rouge Clair Channel R
Slide 12: DTE Gas: replacing aging infrastructure reduces methane emissions
DTE Gas: replacing aging infrastructure reduces methane emissions while improving performance, cost and productivity (billions) 2020 – 2024 gas investment Transformational investments Main renewal Minimizing leaks to reduce costs and $1.4 improve customer satisfaction $3 billion $1.6 Pipeline integr
Slide 13: Committed to methane reduction goal of 80% by 2040
Committed to methane reduction goal of 80% by 2040 Reduced methane emissions continuing reductions in …to achieve goal by 2040 more than 20% since 2011… 2020... Compressor station upgrades Main renewal program Continued infrastructure • Reduced emissions by 93% • Achieving further emission investmen
Slide 14: GSP: high-quality assets with revenue certainty
GSP: high-quality assets with revenue certainty is the foundation for long-term growth 85% of total revenue covered by fixed Pipeline revenue contracts and flowing gas Connecting world-class supply basins to high-quality markets 100% Contract renewal and Gathering 15% volume growth Serving some of t
Slide 15: Majority of GSP growth secured; higher operating earnings with increased certainty
Majority of GSP growth secured; delivering higher operating earnings1 with increased certainty (millions) GSP operating earnings 9.5% • Focusing on continued organic growth from well-positioned platforms $400 – $420 ‒ Majority of future growth secured and supported by strong contracts ‒ Growth poten
Slide 16: P&I: achieving growth from high-quality platforms
P&I: achieving growth from high- quality platforms Industrial energy services Developing new cogeneration projects to improve customer environmental attributes and lower energy costs Renewable energy Expanding RNG business at landfill and agricultural sites to meet growing demand for carbon reductio
Slide 17: Operating earnings underpinned by RNG and cogeneration growth opportunities
Operating earnings1 are underpinned by RNG and cogeneration growth opportunities (millions) P&I operating earnings • RNG and cogeneration projects drive long- term earnings $133 – $148 ‒ Backfill sunsetting REF projects with $125 – $135 new projects • Continuing an origination pace of ~$15 million p
Slide 18: Contact Us
CONTACT US DTE Investor Relations www.dteenergy.com/investors 313.235.8030 18
Slide 19: Appendix
Appendix DTE
Slide 20: DTE Energy
DTE Energy 70% – 75% utility DTE Electric Electric generation and distribution DTE Gas Natural gas transmission, storage and distribution 25% – 30% non-utility Gas Storage & Pipelines (GSP) Transport, store and gather natural gas Power & Industrial Projects (P&I) DTE Energy Own and operate energy re
Slide 21: Commitment to strong culture provides a solid framework for success
Commitment to strong culture provides a solid framework for success Safety National Safety Council’s top 2% of companies surveyed in safety culture Employee engagement Top 3% in the world by Gallup; 7 consecutive Gallup Great Workplace Awards Customer satisfaction Top quartile at both utilities for
Slide 22: Positioned for continued growth from strong 2020 guidance
Positioned for continued growth from strong 2020 guidance Operating EPS1 • 2020 operating EPS guidance midpoint provides 7.5% growth from 2019 original guidance 7.5% • Well-positioned for 5% – 7% operating EPS growth through 2024 • Continued investment in utilities $6.61 ‒ Investing 80% of 5-year ca
Slide 23: 2020 operating earnings guidance
2020 operating earnings1 guidance (millions, except EPS) 2020 operating earnings guidance DTE Electric $759 - $773 DTE Gas 185 - 193 Gas Storage & Pipelines 277 - 293 Power & Industrial Projects 133 - 148 Energy Trading 15 - 25 Corporate & Other (122) - (132) DTE Energy $1,247 - $1,300 Operating EPS
Slide 24: Maintaining strong cash flow, balance sheet and credit profile
Maintaining strong cash flow, balance sheet and credit profile (billions) • $1.6 billion of available liquidity at year-end Planned equity issuances 2019 2020 – 2022 • Maintaining strong investment-grade credit $1.3 rating and FFO1/Debt2 target at 18% Convertible equity units $0.1 – $0.4 $0.1 – $0.3
Slide 25: Cash flow and capital expenditures
Cash flow and capital expenditures Cash flow Capital expenditures (billions) (millions) 2020 2020 guidance guidance Cash from operations1 $3.0 DTE Electric Capital expenditures (4.5) Base infrastructure $680 Free cash flow ($1.5) New generation 1,050 Distribution infrastructure 850 Dividends $(0.8)
Slide 26: DTE Electric and DTE Gas regulatory update
DTE Electric and DTE Gas regulatory update DTE Electric DTE Gas • General rate case – filed July 2019 • General rate case – filed November 2019 (U-20561) (U-20642) ‒ Effective: May 2020 ‒ Effective: October 2020 ‒ Rate recovery: $351 million ‒ Rate recovery: $204 million ‒ ROE: 10.5% ‒ ROE: 10.5% ‒
Slide 27: Blue Union and LEAP asset additions to portfolio
Blue Union and LEAP asset additions to portfolio provide great value and growth Perryville Hub • Premier assets in high-quality Haynesville Carthage Hub basin Southeast Power Markets – Existing fully contracted gathering system Gulf South – Fully contracted large-diameter Texas markets via Mid-coast
Slide 28: Haynesville has experienced rapid growth over the past years
Haynesville has experienced rapid growth other the past 3 years Haynesville production, 2013 – 2019 • Driven by technology innovation, the (Bcf/d) Haynesville basin has expanded since 12 2017 after a flat production period from 2013 – 2017 10 – Making this basin the 2nd fastest growth shale play in
Slide 29: 2018 – 2019 reconciliation of reported to operating earnings (non-GAAP)
2018 – 2019 reconciliation of reported to operating earnings (non-GAAP) Use of Operating Earnings Information – DTE Energy management believes that operating earnings provide a more meaningful representation of the company’s earnings from ongoing operations and uses operating earnings as the primary
Slide 30: 2018 – 2019 reconciliation of reported to operating EPS (non-GAAP)
2018 – 2019 reconciliation of reported to operating EPS (non-GAAP) Use of Operating Earnings Information – DTE Energy management believes that operating earnings provide a more meaningful representation of the company’s earnings from ongoing operations and uses operating earnings as the primary perf
Slide 31: 2008 reconciliation of reported to operating EPS (non-GAAP)
2008 reconciliation of reported to operating EPS (non-GAAP) Use of Operating Earnings Information – DTE Energy management believes that operating earnings provide a more meaningful representation of the company’s earnings from ongoing operations and uses operating earnings as the primary performance
Slide 32: Reconciliation of reported to operating earnings (non-GAAP)
Reconciliation of reported to operating earnings (non-GAAP) Use of Operating Earnings Information – Operating earnings exclude non-recurring items, certain mark-to-market adjustments and discontinued operations. DTE Energy management believes that operating earnings provide a more meaningful represe