DTE Energy 2012 Annual Report Download - page 82

Table of Contents
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of their 2011 EO plan expenses. On October 31, 2012, the MPSC approved DTE Electric's reconciliation and on November 16, 2012, the MPSC approved
DTE Gas' reconciliation. The MPSC orders also approved performance incentive surcharges for DTE Electric of $ 8.4 million and for DTE Gas of $3.4
million to be applied to customer bills rendered on and after January 1, 2013.
In August 2012, Detroit Edison and MichCon filed amended EO plans with the MPSC. DTE Electric's EO plan application proposed the recovery of
EO expenditures for the period 2013-2015 of $ 224 million and DTE Gas' EO plan application proposed the recovery of EO expenditures for the period 2013-
2015 of $66 million. Both applications requested approval of surcharges to recover these costs.
DTE Electric Restoration Expense Tracker Mechanism (RETM) and Line Clearance Tracker (LCT) Reconciliation
In January 2012, DTE Electric filed an application with the MPSC for approval of the reconciliation of its 2011 RETM and LCT. The Company's
2011 restoration expenses were higher than the amount provided in rates. Accordingly, DTE Electric requested net recovery of approximately $ 44 million. An
MPSC order is expected in the first quarter of 2013.
DTE Electric Uncollectible Expense True-Up Mechanism (UETM)
In February 2012, DTE Electric filed an application with the MPSC for approval of its UETM for 2011 requesting authority to refund approximately
$9 million consisting of costs related to 2011 uncollectible expense. An MPSC order is expected in the first quarter of 2013.
DTE Electric Choice Incentive Mechanism (CIM)
In January 2012, DTE Electric filed an application with the MPSC for approval of its CIM reconciliation for the period from January 1, 2011 through
October 28, 2011, the termination date of the CIM pursuant to the October 20, 2011 MPSC rate order. On January 17, 2013, the MPSC approved a settlement
agreement authorizing the Company to recover $ 63 million, plus interest, from its customers through a surcharge to be implemented over a ten-month period
beginning March 2013 through December 2013.
Power Supply Cost Recovery Proceedings
The PSCR process is designed to allow DTE Electric to recover all of its power supply costs if incurred under reasonable and prudent policies and
practices. DTE Electric's power supply costs include fuel and related transportation costs, purchased and net interchange power costs, nitrogen oxide and
sulfur dioxide emission allowances costs, urea costs, transmission costs and MISO costs. The MPSC reviews these costs, policies and practices for prudence
in annual plan and reconciliation filings.
2011 PSCR Year - In March 2012, DTE Electric filed the 2011 PSCR reconciliation calculating a net under-recovery of $ 148 million that includes an
under-recovery of $52.6 million for the 2010 PSCR year. In addition, the 2011 PSCR reconciliation includes an over-refund of $ 3.8 million for the 2011
refund of the self-implementation rate increase related to the 2009 electric rate case filing and a credit of $ 10.5 million related to the expiration of a wholesale
power sales contract.
2013 Plan Year - In September 2012, DTE Electric filed its 2013 PSCR plan case seeking approval of a levelized PSCR factor of 4.74 mills/kWh
above the amount included in base rates for all PSCR customers. The filing supports a total power supply expense forecast of $ 1.5 billion. The plan also
includes approximately $81 million for the recovery of its projected 2012 PSCR under-recovery.
2012 Gas Rate Case Filing
DTE Gas filed a rate case on April 20, 2012 based on a projected test year for the twelve-month period ending October 31, 2013. The filing with the
MPSC requested an increase in base rates of approximately $ 77 million that is required to recover higher costs associated with increased investments in plant,
the impact of sales reductions due to customer losses and continuing conservation, and increasing operating costs, primarily pipeline integrity and leak
remediation expenses. On October 24, 2012, DTE Gas filed notification with the MPSC indicating that it intended to self-implement $ 27 million of rate relief
beginning in November 2012, suspend the RDM and terminate the monthly credit which was implemented to remove the Vulnerable Household Warmth Fund
collections from rates. On December 20, 2012, the MPSC approved a partial settlement agreement and authorized the Company to increase its annual gas
revenues by $19.9 million for service rendered on and after
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