DTE Energy 2014 Annual Report Download - page 58

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DTE Energy owns the following businesses:
• DTE Electric is an electric utility engaged in the generation, purchase, distribution and sale of electricity to approximately 2.1 million customers
in southeastern Michigan;
• DTE Gas is a natural gas utility engaged in the purchase, storage, transportation, distribution and sale of natural gas to approximately 1.2 million
customers throughout Michigan and the sale of storage and transportation capacity; and
• Other businesses involved in 1) natural gas pipelines, gathering and storage; 2) power and industrial projects; and 3) energy marketing and trading
operations.
DTE Electric and DTE Gas are regulated by the MPSC. Certain activities of DTE Electric and DTE Gas, as well as various other aspects of businesses
under DTE Energy are regulated by the FERC. In addition, the Company is regulated by other federal and state regulatory agencies including the NRC, the
EPA, the MDEQ and the CFTC.
References in this Report to “we”, “us”, “our”, “Company” or “DTE” are to DTE Energy and its subsidiaries, collectively.
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The accompanying Consolidated Financial Statements are prepared using accounting principles generally accepted in the United States of America.
These accounting principles require management to use estimates and assumptions that impact reported amounts of assets, liabilities, revenues and expenses,
and the disclosure of contingent assets and liabilities. Actual results may differ from the Company’s estimates.
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The Company consolidates all majority-owned subsidiaries and investments in entities in which it has controlling influence. Non-majority owned
investments are accounted for using the equity method when the Company is able to influence the operating policies of the investee. When the Company
does not influence the operating policies of an investee, the cost method is used. These Consolidated Financial Statements also reflect the Company's
proportionate interests in certain jointly owned utility plants. The Company eliminates all intercompany balances and transactions.
The Company evaluates whether an entity is a VIE whenever reconsideration events occur. The Company consolidates VIEs for which it is the primary
beneficiary. If the Company is not the primary beneficiary and an ownership interest is held, the VIE is accounted for under the equity method of accounting.
When assessing the determination of the primary beneficiary, the Company considers all relevant facts and circumstances, including: the power, through
voting or similar rights, to direct the activities of the VIE that most significantly impact the VIE's economic performance and the obligation to absorb the
expected losses and/or the right to receive the expected returns of the VIE. The Company performs ongoing reassessments of all VIEs to determine if the
primary beneficiary status has changed.
Legal entities within the Company's Power and Industrial Projects segment enter into long-term contractual arrangements with customers to supply
energy-related products or services. The entities are generally designed to pass-through the commodity risk associated with these contracts to the customers,
with the Company retaining operational and customer default risk. These entities generally are VIEs and consolidated when the Company is the primary
beneficiary. In addition, we have interests in certain VIEs through which we share control of all significant activities for those entities with our partners, and
therefore are accounted for under the equity method.
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