DTE Energy 2011 Annual Report Download - page 20

18
• Recoverable uncollectible expense - Receivable for the MPSC approved uncollectible expense tracking mechanism that
tracks the difference in the fluctuation in uncollectible accounts and amounts recognized pursuant to the MPSC
authorization.
• Unamortized loss on reacquired debt - The unamortized discount, premium and expense related to debt redeemed with a
refinancing are deferred, amortized and recovered over the life of the replacement issue.
• Cost to achieve Performance Excellence Process (PEP) - The MPSC authorized the deferral of costs to implement the PEP.
These costs consist of employee severance, project management and consultant support. These costs are amortized over a
ten-year period beginning with the year subsequent to the year the costs were deferred.
(1) Regulatory assets not earning a return.
LIABILITIES
• Asset removal costs - The amount collected from customers for the funding of future asset removal activities.
• Negative pension offset - The Company's negative pension costs are not included as a reduction to its authorized rates;
therefore, the Company is accruing a regulatory liability to eliminate the impact on earnings of the negative pension
expense accrued. This regulatory liability will reverse to the extent the Company's pension expense is positive in future
years.
• Refundable income taxes - Income taxes refundable to our customers representing the difference in property-related
deferred income taxes payable and amounts recognized pursuant to MPSC authorization.
• Accrued GCR refund - Liability for the temporary over-recovery of and a return on gas costs incurred by MichCon which
are recoverable through the GCR mechanism.
• Refundable uncollectible expense (UETM )— Liability for the MPSC approved uncollectible expense tracking mechanism
that tracks the difference in the fluctuation in uncollectible accounts and amounts recognized pursuant to the MPSC
authorization.
• Energy Optimization (EO) - The EO plan is designed to help each customer class reduce their electric usage by: 1) building
customer awareness of energy efficiency options and 2) offering a diverse set of programs and participation options that
result in energy savings for each customer class. The regulatory liability represents EO surcharges collected on excess of
EO plan expenditures incurred.
• Low Income Energy Efficiency Fund (LIEEF) — Escrow of LIEEF funds collected by MichCon as ordered by the MPSC
pursuant to July 2011 Michigan Court of Appeals decision.
• Refundable self implemented rates - Amounts refundable to customers for base rates implemented by MichCon in excess of
amounts authorized in MPSC orders.
• Refundable Michigan income taxes — In July 2007, the MBT was enacted by the State of Michigan. State deferred tax
assets were established for the Company, and offsetting regulatory liabilities were recorded as the impacts of the deferred
tax assets will be reflected in rates. In May 2011, the MBT was repealed and the MCIT was enacted. The state deferred tax
assets were eliminated under the MCIT and related regulatory liabilities were remeasured to zero.
Energy Optimization (EO) Plans
In April 2011, MichCon filed an application for approval of its reconciliation of 2010 EO plan expenses. MichCon's EO
reconciliation includes a cumulative $5.6 million net over-recovery at year end 2010 for the 2010 EO plan. In November 2011,
the MPSC approved a settlement agreement which authorized the over-recovery balances be included in the 2011
reconciliations.
In September 2011, MichCon filed a biennial EO Plan with the MPSC as required. MichCon's EO Plan application proposed
the recovery of EO expenditures for the period 2012-2015 of $103 million and further requested approval of surcharges to