DTE Energy 2014 Annual Report Download - page 80
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The fair value of financial instruments included in the table below is determined by using quoted market prices when available. When quoted prices are
not available, pricing services may be used to determine the fair value with reference to observable interest rate indexes. DTE Energy has obtained an
understanding of how the fair values are derived. DTE Energy also selectively corroborates the fair value of its transactions by comparison of market-based
price sources. Discounted cash flow analyses based upon estimated current borrowing rates are also used to determine fair value when quoted market prices
are not available. The fair values of notes receivable, excluding capital leases, are estimated using discounted cash flow techniques that incorporate market
interest rates as well as assumptions about the remaining life of the loans and credit risk. Depending on the information available, other valuation techniques
may be used that rely on internal assumptions and models. Valuation policies and procedures are determined by DTE Energy's Treasury Department which
reports to the Company's Vice President and Treasurer.
The following table presents the carrying amount and fair value of financial instruments as of December 31, 2014 and 2013:
Notes receivable, excluding capital leases
$ 41
$ —
$ —
$ 41
Dividends payable
$ 116
$ 116
$ —
$ —
Short-term borrowings
$ 131
$ —
$ 131
$ —
Long-term debt, excluding capital leases
$ 8,094
$ 425
$ 7,551
$ 499
For further fair value information on financial and derivative instruments see Note 12 to the Consolidated Financial Statements, "Financial and Other
Derivative Instruments".
DTE Electric has a legal obligation to decommission its nuclear power plants following the expiration of their operating licenses. This obligation is
reflected as an asset retirement obligation on the Consolidated Statements of Financial Position. Rates approved by the MPSC provide for the recovery of
decommissioning costs of Fermi 2 and the disposal of low-level radioactive waste. DTE Electric is continuing to fund FERC jurisdictional amounts for
decommissioning even though explicit provisions are not included in FERC rates. See Note 7 to the Consolidated Financial Statements, "Asset Retirement
Obligations".
The following table summarizes the fair value of the nuclear decommissioning trust fund assets:
Fermi 2
$ 1,172
Fermi 1
3
Low level radioactive waste
16
Total
$ 1,191
77