Cms Energy Corporation · NYSE:CMS
Cms Energy — Mitsubishi UFJ Conference 2013
29 slides from Cms Energy's conference presentation, Sep 17, 2013
Slide 1: CMS Energy Mitsubishi UFJ Conference Program, September 18, 2013
Exhibit 99.1 CMSCombined Mitsubishi September Cross Gas Consumers ENERGY Winds® 18, UFJ Smart 2013 Energy Cycle Utility Energy Plant Park Conference Program
Slide 2: Forward-Looking Statements and Non-GAAP Information
This Securities statements Forward-looking INFORMATION” and could of The comparable CMS adjusted regulatory able 2 the Consumers presentation to presentation ENERGY Energy cause information estimate basis. Exchange items should GAAP CMS provides Management Energy’s the from also statements is Energy
Slide 3: CMS Energy Business Model and EPS Results
CMS 5% $1.55 7% Results EPSa Fair $1.21b $1.26 $1.36 $1.45 Utility $0.96 $1.08 Safe, $0.81 $0.84 $0.90 2003 11th Needed Customer Ten-year Constructive Consistent Self-funded EPS aOperating .b 3 .Adjusted $1.25 . . and & year .2004 excellent ENERGY Business has investment dividend excluding investmen
Slide 4: 2013 Guidance and First Half Results
CMS 2012 First (non-GAAP) Second Hot +13¢ Guidance to Warm $1.55 Adjusted 2013 -13¢ Reliability +14¢ Total Electric +7¢ Gas Better Sales Health Financing .Net 4 . .$1.55 .Benefits Summer Weather case delivering Half Reinvestment Reliability 4¢ ENERGY Manages Winter Than care Half Weather deferred EP
Slide 5: Cost Reductions Trend vs Inflation
Trend CMS Percent Cost -21% Inflation 25% P 0 Accelerated -9% New -6% Reductions 2006 -25% -15% .Lines 5 .rior . . .Reductions Plan Plan 2007 ENERGY smoothed accelerated; ofChange O&M 2008 CostCost for 2009 funding illustrative Savings 2010investment 2011 . .purposes . .2012 and 2013reducing 2014 20
Slide 6: Overhead Cost Performance Versus Peers
2012 CMS (per Overhead Energy Peer $0 Source: Non-Fuel (Pct Consumers .Peers 6 . .$400 . Customer) of Average better Electric ENERGY 23% Revenue) $101 SNL, O&M than Energy Electric $206 O&M Form peers. Electric 1Cost Performance 17% ....
Slide 7: Electric Prices Competitive Nationally
Electric CMS 2011 7% National U 0 Source: .MS 7 .T. .CO competitive Residential ENERGY CA eia.gov Prices average WY. & .MA Bill nationally 3.7% . census.gov, . WA as Percent MNand DC disposable improving. ofRI Disposable NH NJ income ILIncome ME70% AKofNM household VT WI NDincome IA ID NE MT MD MI S
Slide 8: Strong Cost Control Reinvested for Customers
Strong CMS Average 7% 2% Utilities -0.5% -6% Reinvested 2006-2012 Examples Amount Western Workforce SAP Future Classic Productivity Benefit .Consumers 8 . . .Avg. Inflation -6% holds 40 ENERGY -2% (est. Customer 7plans coal Past O&M mothballed of down restructuring -1% 2012 Smart annual 50 10 2% Cos
Slide 9: Cost Control Continues with Additional Savings
Strong CMS Average 7% 2% -0.5% Utilities 2006-2012 -8% -6% Reinvested -2% Examples Annual Classic Productivity Benefit Consumers Additional Retiree Tax Cross .Low 9 . . .Avg. Inflation benefits has cost ENERGY Winds® -2% Customer health 7plans Future O&M been mothballed financing ofcost 2012 Smart (
Slide 10: Structural Benefit Cost Changes
Structural -Peers 6 2005 -6% 2013 -2% 2012 -4% -8 Benefit CMS Timeline – .Source: 10 2.Retiree Increased Healthy Preferred New Union . . better over 2006 +5% salaried union Costs Changes SNL, employees, prescription health living Benefit 2009 2007 impact and cost hires Form employees standard CAGR c
Slide 11: New Cost Savings Fund Investment, Avoid Rate Cases
New Gas $49 2013 Tax/Other Electric $100 Cross aTax 2014 .$0 11 .Until . .Benefits Rate fund Cost 2014 Benefits Winds® 2015 Rate Case elimination Savings test Case Avoideda year Avoideda . . .of . next gas and electric cases!
Slide 12: Rate Case Timeline and Avoided Cases
Rate ELECTRIC New File Avoid On Gas CON Air Securitization Tax Base No < 10.3% EPS .a2013 12 .Includes Inflation . Track Increase .Permit Accounting Case Plant annual 5% underway. Case Michigan Ratesa 2014 filed 10.3% - 7% Elimination surcharges July approved 2015 ROE rate 10.3% 5% filed Energy 12 c
Slide 13: Enhanced Rate Case Strategy
Enhanced Rate New Prior ROE Customer Investment (“Free” O&M EPS, Lowers Helps .Sustains 13 . . . .case OCF Subject allows Customers costs 700 Risk Growth filings base Near-Term &(2013-17) (2013-17) MW CMS dividend torate review Annual GCC) to increases deliver Strategy $7 -1% growth 10.3% Avoid bill
Slide 14: Capital Investment Opportunity
Capital 2013 Opportunity Faster $10 < .Customer 14 . $7 . .Billion at Billion –Smart sustainable 2017 Investment base Level Plan Energy ratesand Plan <2% Pipe affordable . .>4% replacements .. pace, Pole in low-risk, replacements “bite size” Moreprojects. gas generation
Slide 15: Ten-Year Capital Plan
Ten-Year Clean $3 Environmental .replacements 15 . .Billion . inPower customer Capital $2 Capacity Electric Billion Newprojects Investment gas $3.5 reliability Reliability generation (none Billion Plan“bet Electric $4 Infrastructure . .Consumers .the Billion . Company”) distribution Smartrepresents
Slide 16: Electric Reliability Investments
Investments > 262 280 5-year 204 2 0 Last Investment (bils) Customer Total .Heat-related 16 .007 20% . . 5benefit 2012 investment (bils) Next improvement Outage reliability 5customers, in outages Years Electric $0.5 Minutes Years $0.3 were $0.6 Reliability who $0.4 down can Line 60% “count . clearin
Slide 17: Capacity Needs and New Gas Plant
Capacity Installed MW 8,500 9,500 7,500 2013 .4,500 17 . . . to New 2014 Market 6,500 meet Capacity Needed Gas 2015 5,500 reserve Purchases Plant 2016 . Excl . .Peak requirements. . 2017 Classic Demand 20187 Classic with Reserve 7 Margin 10,500
Slide 18: New Gas Plant CON Progress
New CON economic 2012 Air Submitted July Filed of Certificate Award Project Necessity Contracts .Investment 18 . . .Permit 25 progress Gas 2013 7/12 filed Major Plant to benefits Approval Approved July 2014 (mils) Proceed Full continues CON 12th 2015 $6 Notice Expected Operation $106 Filed 2016 asCo
Slide 19: Near-Term Catalysts
Near-Term 1. Catalysts 2. 3. 4. 5. 6. 7. New Progress Avoided .CON 19 . .Self-funded Constructive Rate Cost Securitization Gas Capital . progress commissioner filed plant cases ofelectric investment removal July Catalysts CON continues, growth regulation 12th, andappointed, gas .order . . more .rate
Slide 20: Michigan Energy Policy Review Timeline
Michigan Renewable Electric Energy Additional Length “Appendix Seven 2013 May-Jun Draft Nov feedback Sep-Nov Governor Source: recommendations .Future 20 . . . Final toreports, public improve of Topics efficiency michigan.gov/energy choice Analyze makes Preparing cases, reports areas A” energy forums
Slide 21: Key Takeaways
Key EPS 5% 7% $1.70 +4% +12% +11% +7% Actual 2003 5%-7% Growth Dividend Gross Cost Transparent Low Needed Ten-year .aConstructive 21 .Adjusted . . Takeaways... adistinguish rates reductions +8% 2004 Yield operating Growth EPS real investment investment growth EPS 2005 =~4% growth regulatory 7% 8%(no
Slide 22: Appendix
APPENDIX
Slide 23: Michigan's New Public Service Commission
Michigan’s New Previous Provided Michigan Public BS Education MPA John Commission .Sally 23 . . -. strong Michigan Commissioner Quackenbush -Talberg Sector Utility University Experience support research Public Department Constructive law(I) Consultants Commission State on Greg Service for of for the
Slide 24: Michigan Energy Law Goals
2008 Progress Energy Goal Gas .Renewable 24 . . . 3.3% .Electric Law.... established Efficiency Ahead 3.85% Energy 4.1% ofMichigan’s 2008 Plan 8% 5.5%10% 2015 energy priorities.
Slide 25: Regulatory Lag and Authorized ROE vs Peers
2008 Regulatory Months 12 M 8 F 6 4 Source: Authorized (CMS Consumers 10.8% Small 10.6 2 0 Peers 10 10.2 .10.4 25 .008 ile-and-implement ichigan .Peers . provided Law 2009 Michigan vs. SNL (Months Peers) .2010 Lag ROE Energy .. RRA, .fair . Premium 2011 toand Electric 2013 Order) 6 months 2012 timel
Slide 26: Michigan Gross Domestic Product Performance
Michigan Gross 5th WA 11% MT ND MN OR ID WY SD WI NE IA NV UT CO KS MO IL MI IN OH PA NY VT NH ME MA RI CT NJ DE DC MD VA NC WV SC KY TN GA FL AL MS AR LA OK TX NM AZ CA HI AK U.S. Highest Fourth .Source: 26 . .5.9 6.6 2.4 2.1 12.3 6.9 3.1 3.6 5.9 11.0 7.6 .1.0 6.1 5.9 4.6 Best 4.7 7.3 5.0 8.7 8.2 7
Slide 27: Michigan Economy and Employment Growth
Central 980 Thousands Employment 50,000 955 2003 880 905 930 New 2013 Projects Investment 229 $3 JR Alticor Dieomatic Pulverdryer .Source: 27 . .Billion Automation .Projects Up economy or Announcements 2005 jobs Magna West Expanding 7% http://www.michiganadvantage.org/Projects/ 21622K Dart 2007 $3.3
Slide 28: GAAP Reconciliation
GAAP Reconciliation
Slide 29: CMS Energy Earnings Per Share Reconciliation by Year
CMS Earnings 2003 Reported After-tax Electric Enterprises Corporate Discontinued Asset Cumulative Mark-to-market Adjusted * (a) 29Less $1.25 2004 ENERGY impairment than and Per excluding earnings items: interest 2005 0.74 $500 accounting gas Share operations CORPORATION utility impacts 0.62 2006 tho