Dte Energy Company · NYSE:DTE
Dte Energy — EEI Financial Conference 2021
43 slides from Dte Energy's conference presentation, Nov 5, 2021
Slide 1: EEI Financial Conference
E E I F I N A N C I A L C O N F E R E N C E NOVEMBER 7 - 9, 2021
Slide 2: Safe harbor statement
Safe harbor statement The information contained herein is as of the date of this document. DTE Energy expressly disclaims any current intention to update any forward-looking statements contained in this document as a result of new information or future events or developments. Words such as “anticipa
Slide 3: Overview
Overview Business Update Environmental, Social & Governance (ESG) Appendix 3
Slide 4: Focusing on our team, customers and communities while delivering for investors
Focusing on our team, customers and communities while delivering for investors Ensuring the health and safety of our employees Recognized as a Gallup Great Workplace for the ninth consecutive year Our Team Addressing our customers’ most vital needs Investing an additional $70 million to combat extre
Slide 5: Solidifying future growth with updated plan; continuing 5%-7% operating EPS growth
Solidifying future growth with updated plan; continuing 5% - 7% operating EPS1 growth through 2026 ✓ Increased 2021 operating EPS guidance twice and currently tracking above the midpoint of guidance range; providing over 14% growth from 2020 original guidance midpoint ✓ Targeting higher end of 5% -
Slide 6: Operating in a highly constructive regulatory environment
Operating in a highly constructive regulatory environment MPSC members MPSC key objectives Ranking of U.S. regulatory jurisdictions1 (Michigan in tier 1) Dan Scripps Chair • Empower customers to make informed Tier 1 7 Term ending July 2, 2023 utility choices • Assure safe, secure and reliable utilit
Slide 7: Distinctive continuous improvement culture drives strong cost management
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 O&M costs surface and solve problems 2008 - 2020 • Controlling costs while improving the customer experience and Electr
Slide 8: Michigan's strong economy is driven by technology and manufacturing
Michigan’s strong economy is driven by technology and manufacturing 3rd highest GDP growth in the nation1 8.3% 6.7% 4th best state to make a living2 4.8% 4.6% 6th best state for technology and innovation3 11th top state for business3 Unemployment rate 4 Change in GDP 1 National average Michigan 1. U
Slide 9: Delivering premium results through disciplined planning and management
Delivering premium results through disciplined planning and management 2010 - 2020 operating EPS1 CAGR highest among DTE delivers premium total Midwest pure-play utility peers shareholder return2 281% 7.2% 7.0% 7.0% 5.9% 5.6% 2.4% 65% 18% 1-year 5-year 10-year DTE Midwest pure-play peers S&P 500 Uti
Slide 10: Business Update
Overview Business Update Environmental, Social & Governance (ESG) Appendix 10
Slide 11: Delivering strong operating EPS growth in 2021 and 2022
Delivering strong operating EPS1 growth in 2021 and 2022 Operating EPS guidance • Increased 2021 operating EPS guidance twice and currently tracking above the midpoint of guidance range − Reflects investment of additional $70 million to combat extreme weather-related power outages with no impact to
Slide 12: Increased utility investment in 5-year plan supports 5%-7% EPS growth
Increased utility investment in 5-year plan supports 5% - 7% operating EPS1 growth through 2026 (billions) Capital investment increased in 5-year plan DTE 5-year investment plan 2022 - 2026 $18 $17 $3.1 DTE Gas DTE Electric $3.0 $15 ~$19.5 billion $14 $15 DTE Electric DTE Gas $3.1 DTE Vantage 2021 -
Slide 13: DTE Electric: transformational investments in generation and distribution
DTE Electric: transformational investments in generation and distribution provide customers cleaner, more reliable energy Cleaner generation • Accelerating carbon reduction plan DTE Electric investment plan − Ceasing coal use at Belle River Power Plant and reducing carbon emissions (billions) by 50%
Slide 14: Clean energy transformation creates $35 billion investment opportunity
Clean energy transformation and building the grid of the future creates $35 billion of investment opportunity over the next 10 years DTE Electric 10-year investment plan (billions) • Future investments could accelerate net zero emissions target from ~$35 2050 • Accelerating the cessation of coal use
Slide 15: Investment opportunities exist over the next 10 years
Investment opportunities exist over the next 10 years due to the need for a modern, reliable grid and clean, affordable generation Upper Midwest climate extremes index (CEI) DTE Electric load from vehicle electrification 3 and wind 1960 - 2020 (GWh) 70 6,000 60 50 4,000 40 30 2,000 20 10 0 0 1960 19
Slide 16: Robust investment opportunities for the grid of the future
Robust investment opportunities for the grid of the future; driving capital opportunity in 10-year investment plan Infrastructure hardening and resilience Technology and automation Hardening the system, enhancing pole top maintenance and Advanced Distribution Management System will provide a increas
Slide 17: Continuing to evaluate the cessation of coal use
Continuing to evaluate the cessation of coal use to further accelerate decarbonization plan River St. Trenton Belle Belle Monroe Rouge Clair Channel River River 2021 2022 2028 2030 2040 Accelerating Evaluating cessation of coal cessation of use from 2030 coal use earlier to 2028 than 2040 • Stakehol
Slide 18: DTE Gas: replacing aging infrastructure to reduce greenhouse gas emissions
DTE Gas: replacing aging infrastructure to reduce greenhouse gas emissions DTE Gas investment plan Main renewal (billions) • Minimizes leaks, both reducing costs and improving customer satisfaction $3.1+ Base infrastructure Additional $3.0 opportunity • Enhances transmission, compression, distributi
Slide 19: DTE Vantage: strategic focus on decarbonization solutions for customers
DTE Vantage (formerly Power & Industrial Projects): strategic focus on decarbonization solutions for customers Renewable natural gas (RNG) DTE Vantage operating earnings1 (millions) • Commenced construction on new Wisconsin RNG project and secured additional project in New York $147 - $163 $160 - $1
Slide 20: Maintaining strong cash flow, balance sheet and credit profile
Maintaining strong cash flow, balance sheet and credit profile; minimal equity issuances outside of convertible equity units Planned equity issuances • Strong investment-grade credit rating 2022 - 2024 (billions) − Targeting ~16% FFO1 / Debt2 • Increased 2022 annualized dividend 7% to $3.54 per shar
Slide 21: Environmental, Social & Governance (ESG)
Overview Business Update Environmental, Social & Governance (ESG) Appendix 21
Slide 22: ESG efforts are key priorities
Environmental, social and governance efforts are key priorities; aspiring to be the best in the industry Environment Social Governance • Transitioning towards net zero • Focusing on the diversity, safety, • Focusing on the oversight of emissions at both utilities well-being and success of our enviro
Slide 23: DTE Electric targeting net zero carbon emissions by 2050
DTE Electric targeting net zero carbon emissions by 2050 • Advancing our clean energy investments and plan to accelerate the modernization of our electric grid • Retiring coal-fired power plants • Accelerating voluntary renewables program, one of the largest in the nation • Adding thousands of megaw
Slide 24: DTE Gas targeting net zero GHG emissions by 2050
DTE Gas targeting net zero greenhouse gas (GHG) emissions by 2050 • Advancing our clean energy investments and upgrading and replacing aging infrastructure • Growing CleanVision Natural Gas Balance program, the nation’s first program to include both carbon offsets and RNG • Progressing on major tran
Slide 25: MIGreenPower program providing affordable renewable energy solutions
MIGreenPower program providing affordable renewable energy solutions • One of the largest voluntary renewable programs in the nation 2017 • Average net cost to residential customer program initiation − Wind & solar program: 3.1 cents/kWh − Wind program: 2.2 cents/kWh • An average business customer u
Slide 26: Natural Gas Balance program reducing GHG emissions
Natural Gas Balance program reducing GHG emissions 2021 • Offering a way to affordably offset 25% to 100% of customers’ greenhouse gas emissions from an program initiation average home’s natural gas use • RNG will be sourced by transforming landfill emissions and wastewater treatment plant by-produc
Slide 27: Marching toward net zero carbon emissions with an accelerated plan
Marching toward net zero carbon emissions with an accelerated plan Cleaner generation mix1 (MWh %) 3% 4% 4% Storage 2% 1% 17% 16% 25% - 30% Renewables 22% 20% - 25% Natural gas 20% 77% 20% Nuclear 38% 25% - 30% Coal 2005 2023E 2028E 1. Generation mix represents one potential pathway and is subject t
Slide 28: Progressing on EV initiatives
Progressing on EV initiatives 2019 Charging Forward Program program initiation • Promoting EV education, infrastructure and adoption • Offering residential charger rebates and infrastructure incentives Achieving major milestones in 2021 23,000 • 800 residential rebates approved and installed gallons
Slide 29: Environmental sustainability is critical to creating long-term shareholder value
Environmental sustainability is critical to creating long-term shareholder value Driving collaboration in the fight against climate change Protecting our natural resources • Leading by example with aggressive goal to achieve net zero • Targeting a 25% reduction of energy, water and waste at our carb
Slide 30: Committed to diversity, equity and inclusion
Committed to diversity, equity and inclusion; creating a safe and welcoming environment Health and safety of our people is a priority Employee resource groups promote a safe and welcoming environment and offer professional development, networking, • Multiple safety committees spanning all levels of
Slide 31: Leader in volunteerism and strengthening ties with our communities
Leader in volunteerism and strengthening ties with our communities 2,900 volunteers 47,000 hours volunteered 779 nonprofits helped $90m awarded for energy assistance 1,400 students employed at DTE through programs statewide 16,000 customers enrolled in low-income self-sufficiency plans 31
Slide 32: Committed to Michigan investments and supplier diversity
Building on the momentum of the last decade, DTE is committed to Michigan investments and supplier diversity 2020 Michigan spend (millions) $2.2b invested in Michigan businesses in 2020 44,000 jobs created since 2010 $10 $969m invested with Detroit suppliers in 2020 $67 invested with diverse women a
Slide 33: Award-winning commitment to being a top ESG employer
Award-winning commitment to being a top ESG employer in the country Corporate citizenship awards Veteran friendly Gallup Great Ambassadors Championing Overall excellence America’s Most employer Workplace Award 9 Excellence Award for in diversity Responsible consecutive years commitment to supporting
Slide 34: Governance framework provides shareholder rights and enables value creation
Governance framework provides shareholder rights and enables sustainable value creation Best-in-class governance practices 2 8 • Lead Independent Director • All board committees are composed exclusively of independent 83% 33% Directors gender or independent ethnically • Stock ownership guidelines fo
Slide 35: Executive management compensation plan is aligned with core priorities
Executive management compensation plan is aligned with our core priorities Priorities Performance-based compensation elements Annual incentive metrics Long-term metrics • Employee engagement Highly engaged employees • Employee safety Top decile customer • Customer satisfaction satisfaction • Custome
Slide 36: Visit us: DTE Investor Relations 2021 ESG Report
VISIT US: DTE INVESTOR RELATIONS 2021 ESG REPORT
Slide 37: Appendix
Overview Business Update Environmental, Social & Governance (ESG) Appendix 37
Slide 38: Increased 2021 operating EPS guidance twice
Increased 2021 operating EPS1 guidance twice and currently tracking above the midpoint of guidance range (millions, except EPS) 2021 guidance DTE Electric $853 - $867 DTE Gas 202 - 212 DTE Vantage 160 - 170 Energy Trading 40 - 50 Corporate & Other (148) - (138) DTE Energy $1,107 - $1,161 Operating E
Slide 39: Targeting higher end of 5%-7% operating EPS growth to 2022 early outlook
Targeting higher end of 5% - 7% operating EPS1 growth from 2021 original guidance midpoint to 2022 early outlook (millions, except EPS) 2021 original guidance 2022 early outlook Primary drivers Distribution and cleaner generation DTE Electric $826 - $840 $915 - $929 investments Continued main renewa
Slide 40: 2021 cash flow and capital expenditures guidance
2021 cash flow and capital expenditures guidance Cash flow Capital expenditures (billions) Current (millions) Current guidance guidance Cash from operations1 $2.7 DTE Electric Capital expenditures (3.9) Base infrastructure $1,030 Free cash flow ($1.2) New generation 950 Dividends (0.8) Distribution
Slide 41: DTE Electric and DTE Gas regulatory update
DTE Electric and DTE Gas regulatory update DTE Electric DTE Gas • Renewable energy plan (U-18232) • Securitization filing (U-21015) • General rate case filed February 2021 (U-20940) − Received order: July 2020 − Received order: June 2021 − Effective: January 1, 2022 − 350 MW of additional renewable
Slide 42: Utilities have provided solid rate base growth
Utilities have provided solid rate base growth DTE Electric rate base DTE Electric authorized ROE (billions) $18.9 $20.4 $16.5 $17.7 10.3% 10.1% 10.0% 10.0% 9.9% $15.6 2016 2017 2018 2019 2020 2016 2017 2018 2019 2020 DTE Gas rate base DTE Gas authorized ROE (billions) $4.8 $5.2 10.1% 10.1% 10.0% 10
Slide 43: 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