RETIREMENT BENEFITS AND TRUSTEED ASSETS

DTE Energy's subsidiary, DTE Energy Corporate Services, LLC (LLC), sponsors defined benefit pension plans and other postretirement plans covering substantially all employees of the Registrants.

The table below represents the pension and other postretirement benefit plans which employees of each Registrant participated at December 31, 2017:



	Registrants
	DTE Energy	DTE Electric
Qualified Pension Plans
DTE Energy Company Retirement Plan	X	X
DTE Gas Company Retirement Plan for Employees Covered by Collective Bargaining Agreements	X
Shenango Inc. Pension Plan	X
Nonqualified Pension Plans
DTE Energy Company Supplemental Retirement Plan	X	X
DTE Energy Company Executive Supplemental Retirement Plan^(a)	X	X
DTE Energy Company Supplemental Severance Benefit Plan	X
Other Postretirement Benefit Plans
The DTE Energy Company Comprehensive Non-Health Welfare Plan	X	X
The DTE Energy Company Comprehensive Retiree Group Health Care Plan	X	X
DTE Supplemental Retiree Benefit Plan	X	X
DTE Energy Company Retiree Reimbursement Arrangement Plan	X	X

_____________________________________


(a)	Sponsored by the DTE Energy subsidiary, DTE Energy Holding Company.

DTE Electric participates in various plans that provide pension and other postretirement benefits for DTE Energy and its affiliates. The plans are sponsored by the LLC. DTE Electric accounts for its participation in DTE Energy's qualified and nonqualified pension plans by applying multiemployer accounting. DTE Electric accounts for its participation in other postretirement benefit plans by applying multiple-employer accounting. Within multiemployer and multiple-employer plans, participants pool plan assets for investment purposes and to reduce the cost of plan administration. The primary difference between plan types is assets contributed in multiemployer plans can be used to provide benefits for all participating employers, while assets contributed within a multiple-employer plan are restricted for use by the contributing employer. Plan participants of all plans are solely DTE Energy and affiliate employees.

Pension Plan Benefits

DTE Energy has qualified defined benefit retirement plans for eligible represented and non-represented employees. The plans are noncontributory and provide traditional retirement benefits based on the employee's years of benefit service, average final compensation, and age at retirement. In addition, certain represented and non-represented employees are covered under cash balance provisions that determine benefits on annual employer contributions and interest credits. DTE Energy also maintains supplemental nonqualified, noncontributory, retirement benefit plans for selected management employees. These plans provide for benefits that supplement those provided by DTE Energy’s other retirement plans.

Net pension cost for DTE Energy includes the following components:



	2017			2016			2015
	(In millions)
Service cost	$	92		$	92		$	100
Interest cost	214			219			210
Expected return on plan assets	(311		)	(309		)	(296		)
Amortization of:
Net actuarial loss	176			164			205
Prior service cost	1			1			—
Other	—			—			2
Net pension cost	$	172		$	167		$	221



	2017			2016
	(In millions)
Other changes in plan assets and benefit obligations recognized in Regulatory assets and Other comprehensive income (loss)
Net actuarial loss	$	27		$	197
Amortization of net actuarial loss	(176		)	(164		)
Prior service cost (credit)	(11		)	7
Amortization of prior service cost	(1		)	(1		)
Total recognized in Regulatory assets and Other comprehensive income (loss)	$	(161	)	$	39
Total recognized in net periodic pension cost, Regulatory assets, and Other comprehensive income (loss)	$	11		$	206
Estimated amounts to be amortized from Regulatory assets and Accumulated other comprehensive income (loss) into net periodic benefit cost during next fiscal year
Net actuarial loss	$	178		$	172
Prior service cost	$	—		$	1

The following table reconciles the obligations, assets, and funded status of the plans as well as the amounts recognized as prepaid pension cost or pension liability in DTE Energy's Consolidated Statements of Financial Position at December 31:



	DTE Energy
	2017			2016
	(In millions)
Accumulated benefit obligation, end of year	$	5,149		$	4,753
Change in projected benefit obligation
Projected benefit obligation, beginning of year	$	5,171		$	4,971
Service cost	92			92
Interest cost	214			219
Plan amendments	(11		)	7
Actuarial loss	391			141
Benefits paid	(281		)	(259		)
Projected benefit obligation, end of year	$	5,576		$	5,171
Change in plan assets
Plan assets at fair value, beginning of year	$	4,012		$	3,832
Actual return on plan assets	674			253
Company contributions	231			186
Benefits paid	(281		)	(259		)
Plan assets at fair value, end of year	$	4,636		$	4,012
Funded status	$	(940	)	$	(1,159	)
Amount recorded as:
Current liabilities	$	(16	)	$	(7	)
Noncurrent liabilities	(924		)	(1,152		)
	$	(940	)	$	(1,159	)
Amounts recognized in Accumulated other comprehensive income (loss), pre-tax
Net actuarial loss	$	163		$	163
Prior service cost	6			8
	$	169		$	171
Amounts recognized in Regulatory assets^(a)
Net actuarial loss	$	2,014		$	2,163
Prior service credit	(14		)	(4		)
	$	2,000		$	2,159

______________________________________


(a)	See Note 9 to the Consolidated Financial Statements, "Regulatory Matters."

The Registrants' policy is to fund pension costs by contributing amounts consistent with the provisions of the Pension Protection Act of 2006, and additional amounts when it deems appropriate. The following table provides cash contributions to the qualified pension plans as of December 31:



	2017		2016		2015
	(In millions)
DTE Energy	$	223	$	179	$	177
DTE Electric	185		145		145

At the discretion of management, and depending upon financial market conditions, DTE Energy anticipates making up to $200 million in contributions, including $175 million of DTE Electric contributions, to the qualified pension plans in 2018.

DTE Energy's subsidiaries are responsible for their share of qualified and nonqualified pension benefit costs. DTE Electric's allocated portion of pension benefit costs included in capital expenditures and operating and maintenance expense were $136 million for the years ended December 31, 2017 and 2016, and $176 million for the year ended December 31, 2015. These amounts include recognized contractual termination benefit charges, curtailment gains, and settlement charges.

At December 31, 2017, the benefits related to DTE Energy's qualified and nonqualified pension plans expected to be paid in each of the next five years and in the aggregate for the five fiscal years thereafter are as follows:



	(In millions)
2018	$	299
2019	301
2020	316
2021	317
2022	323
2023-2027	1,692
Total	$	3,248

Assumptions used in determining the projected benefit obligation and net pension costs of DTE Energy are:



	2017	2016	2015
Projected benefit obligation
Discount rate	3.70%	4.25%	4.50%
Rate of compensation increase	4.98%	4.65%	4.65%
Net pension costs
Discount rate	4.25%	4.50%	4.12%
Rate of compensation increase	4.65%	4.65%	4.65%
Expected long-term rate of return on plan assets	7.50%	7.75%	7.75%

DTE Energy employs a formal process in determining the long-term rate of return for various asset classes. Management reviews historic financial market risks and returns and long-term historic relationships between the asset classes of equities, fixed income, and other assets, consistent with the widely accepted capital market principle that asset classes with higher volatility generate a greater return over the long-term. Current market factors such as inflation, interest rates, asset class risks, and asset class returns are evaluated and considered before long-term capital market assumptions are determined. The long-term portfolio return is also established employing a consistent formal process, with due consideration of diversification, active investment management, and rebalancing. Peer data is reviewed to check for reasonableness. As a result of this process, the Registrants have long-term rate of return assumptions for the pension plans of 7.50% and other postretirement benefit plans of 7.75% for 2018. The Registrants believe these rates are a reasonable assumption for the long-term rate of return on plan assets for 2018 given the current investment strategy.

DTE Energy employs a total return investment approach whereby a mix of equities, fixed income, and other investments are used to maximize the long-term return on plan assets consistent with prudent levels of risk, with consideration given to the liquidity needs of the plan. Risk tolerance is established through consideration of future plan cash flows, plan funded status, and corporate financial considerations. The investment portfolio contains a diversified blend of equity, fixed income, and other investments. Furthermore, equity investments are diversified across U.S. and non-U.S. stocks, growth and value stocks, and large and small market capitalizations. Fixed income securities generally include market duration bonds of companies from diversified industries, mortgage-backed securities, non-U.S. securities, bank loans, and U.S. Treasuries. Pension assets include long duration U.S. government and diversified corporate bonds intended to partially mitigate liability volatility caused by changes in discount rates. Other assets, such as private markets and hedge funds, are used to enhance long-term returns while improving portfolio diversification. Derivatives may be utilized in a risk controlled manner, to potentially increase the portfolio beyond the market value of invested assets and/or reduce portfolio investment risk. Investment risk is measured and monitored on an ongoing basis through annual liability measurements, periodic asset/liability studies, and quarterly investment portfolio reviews.

Target allocations for DTE Energy's pension plan assets as of December 31, 2017 are listed below:



U.S. Large Capitalization (Cap) Equity Securities	18	%
U.S. Small Cap and Mid Cap Equity Securities	5
Non-U.S. Equity Securities	17
Fixed Income Securities	32
Hedge Funds and Similar Investments	20
Private Equity and Other	8
	100	%

The following tables provide the fair value measurement amounts for DTE Energy's pension plan assets at December 31, 2017 and 2016^(a):



	December 31, 2017											December 31, 2016
	Level 1			Level 2			Other^(b)		Total			Level 1			Level 2			Other^(b)		Total
	(In millions)
DTE Energy asset category:
Short-term Investments^(c)	$	—		$	114		$	—	$	114		$	—		$	22		$	—	$	22
Equity Securities
U.S. Large Cap^(d)	821			5			—		826			875			5			—		880
U.S. Small Cap and Mid Cap^(e)	229			5			—		234			229			3			—		232
Non-U.S.^(f)	529			13			280		822			479			18			269		766
Fixed Income Securities^(g)	1			1,453			—		1,454			1			1,037			52		1,090
Hedge Funds and Similar Investments^(h)	265			—			593		858			231			—			578		809
Private Equity and Other⁽ⁱ⁾	—			—			328		328			—			—			213		213
Securities Lending^(j)	(53		)	(13		)	—		(66		)	(53		)	(25		)	—		(78		)
Securities Lending Collateral^(j)	53			13			—		66			53			25			—		78
DTE Energy Total	$	1,845		$	1,590		$	1,201	$	4,636		$	1,815		$	1,085		$	1,112	$	4,012

_______________________________________


(a)	For a description of levels within the fair value hierarchy, see Note 12 to the Consolidated Financial Statements, "Fair Value."


(b)	Amounts represent assets valued at NAV as a practical expedient for fair value.


(c)	This category predominantly represents certain short-term fixed income securities and money market investments that are managed in separate accounts or commingled funds. Pricing for investments in this category are obtained from quoted prices in actively traded markets or valuations from brokers or pricing services.


(d)	This category represents portfolios of large capitalization domestic equities. Investments in this category are exchange-traded securities whereby unadjusted quote prices can be obtained.


(e)	This category represents portfolios of small and medium capitalization domestic equities. Investments in this category are exchange-traded securities whereby unadjusted quote prices can be obtained.


(f)	This category primarily consists of portfolios of non-U.S. developed and emerging market equities. Investments in this category are exchange-traded securities whereby unadjusted quote prices can be obtained. Exchange-traded securities held in a commingled fund are classified as NAV assets.


(g)	This category includes corporate bonds from diversified industries, U.S. Treasuries, and mortgage-backed securities. Pricing for investments in this category is obtained from quoted prices in actively traded markets and quotations from broker or pricing services. Non-exchange traded securities and exchange-traded securities held in commingled funds are classified as NAV assets.


(h)	This category utilizes a diversified group of strategies that attempt to capture financial market inefficiencies and includes publicly traded mutual funds, commingled funds and limited partnership funds. Pricing for mutual funds in this category is obtained from quoted prices in actively traded markets. Commingled funds or limited partnership funds are classified as NAV assets.


(i)	This category includes a diversified group of funds and strategies that primarily invests in private equity partnerships. This category also includes investments in timber and private mezzanine debt. All pricing for investments in this category are classified as NAV assets.


(j)	DTE Energy has a securities lending program with a third-party agent. The program allows the agent to lend certain securities from DTE Energy's pension trusts to selected entities against receipt of collateral (in the form of cash) as provided for and determined in accordance with their securities lending agency agreements.

The pension trust holds debt and equity securities directly and indirectly through commingled funds and institutional mutual funds. Exchange-traded debt and equity securities held directly are valued using quoted market prices in actively traded markets. The commingled funds and institutional mutual funds hold exchange-traded equity or debt securities and are valued based on stated NAVs. Non-exchange traded fixed income securities are valued by the trustee based upon quotations available from brokers or pricing services. A primary price source is identified by asset type, class, or issue for each security. The trustee monitors prices supplied by pricing services and may use a supplemental price source or change the primary price source of a given security if the trustee challenges an assigned price and determines that another price source is considered preferable. DTE Energy has obtained an understanding of how these prices are derived, including the nature and observability of the inputs used in deriving such prices. Additionally, DTE Energy selectively corroborates the fair value of securities by comparison of market-based price sources.

There were no significant transfers between Level 2 and Level 1 in the years ended December 31, 2017 and 2016 for DTE Energy.

Other Postretirement Benefits

The Registrants participate in defined benefit plans sponsored by the LLC that provide certain other postretirement health care and life insurance benefits for employees who are eligible for these benefits. The Registrants' policy is to fund certain trusts to meet its other postretirement benefit obligations. Separate qualified VEBA and other benefit trusts exist. DTE Energy did not make any contributions to these trusts during 2017 and does not anticipate making any contributions to the trusts in 2018.

DTE Energy and DTE Electric offer a defined contribution VEBA for eligible represented and non-represented employees, in lieu of defined benefit post-employment health care benefits. The Registrants allocate a fixed amount per year to an account in a defined contribution VEBA for each employee. These accounts are managed either by the Registrant (for non-represented and certain represented groups) or by the Utility Workers of America for Local 223 employees. DTE Energy contributions to the VEBA for these accounts were $8 million in 2017, $6 million in 2016, and $5 million in 2015, including DTE Electric contributions of $3 million in 2017, 2016, and 2015.

The Registrants also contribute a fixed amount to a Retiree Reimbursement Account, for certain current and future non-represented and represented retirees, spouses, and surviving spouses when the youngest of the retiree's covered household becomes eligible for Medicare Part A based on age. The amount of the annual allocation to each participant is determined by the employee's retirement date, and increases each year for each eligible participant at the lower of the rate of medical inflation or 2%.

Net other postretirement credit for DTE Energy includes the following components:



	2017			2016			2015
	(In millions)
Service cost	$	27		$	27		$	34
Interest cost	73			80			81
Expected return on plan assets	(130		)	(129		)	(131		)
Amortization of:
Net actuarial loss	13			30			43
Prior service credit	(14		)	(118		)	(126		)
Other	—			(1		)	—
Net other postretirement credit	$	(31	)	$	(111	)	$	(99	)



	2017			2016
	(In millions)
Other changes in plan assets and accumulated postretirement benefit obligation recognized in Regulatory assets and Other comprehensive income (loss)
Net actuarial gain	$	(21	)	$	(68	)
Amortization of net actuarial loss	(13		)	(30		)
Prior service credit	(1		)	—
Amortization of prior service credit	14			119
Total recognized in Regulatory assets and Other comprehensive income (loss)	$	(21	)	$	21
Total recognized in net periodic benefit cost, Regulatory assets, and Other comprehensive income (loss)	$	(52	)	$	(90	)
Estimated amounts to be amortized from Regulatory assets and Accumulated other comprehensive income (loss) into net periodic benefit cost during next fiscal year
Net actuarial loss	$	11		$	16
Prior service credit	$	(1	)	$	(14	)

Net other postretirement credit for DTE Electric includes the following components:



	2017			2016			2015
	(In millions)
Service cost	$	20		$	20		$	25
Interest cost	56			61			62
Expected return on plan assets	(90		)	(90		)	(90		)
Amortization of:
Net actuarial loss	8			21			31
Prior service credit	(10		)	(89		)	(95		)
Net other postretirement credit	$	(16	)	$	(77	)	$	(67	)



	2017			2016
	(In millions)
Other changes in plan assets and accumulated postretirement benefit obligation recognized in Regulatory assets
Net actuarial (gain) loss	$	2		$	(59	)
Amortization of net actuarial loss	(8		)	(21		)
Amortization of prior service credit	10			89
Total recognized in Regulatory assets	$	4		$	9
Total recognized in net periodic benefit cost and Regulatory assets	$	(12	)	$	(68	)
Estimated amounts to be amortized from Regulatory assets into net periodic benefit cost during next fiscal year
Net actuarial loss	$	8		$	10
Prior service credit	$	—		$	(10	)

The following table reconciles the obligations, assets, and funded status of the plans including amounts recorded as Accrued postretirement liability in the Registrants' Consolidated Statements of Financial Position at December 31:



	DTE Energy						DTE Electric
	2017			2016			2017			2016
	(In millions)
Change in accumulated postretirement benefit obligation
Accumulated postretirement benefit obligation, beginning of year	$	1,795		$	1,846		$	1,373		$	1,414
Service cost	27			27			20			20
Interest cost	73			80			56			61
Actuarial (gain) loss	101			(75		)	84			(62		)
Benefits paid	(86		)	(83		)	(63		)	(60		)
Accumulated postretirement benefit obligation, end of year	$	1,910		$	1,795		$	1,470		$	1,373
Change in plan assets
Plan assets at fair value, beginning of year	$	1,758		$	1,617		$	1,218		$	1,131
Actual return on plan assets	252			122			172			87
Company contributions	—			20			—			—
Benefits paid	(162		)	(1		)	(118		)	—
Plan assets at fair value, end of year	$	1,848		$	1,758		$	1,272		$	1,218
Funded status	$	(62	)	$	(37	)	$	(198	)	$	(155	)
Amount recorded as:
Noncurrent assets	$	—		$	—		$	113		$	114
Current liabilities	(1		)	(1		)	—			—
Noncurrent liabilities	(61		)	(36		)	(311		)	(269		)
	$	(62	)	$	(37	)	$	(198	)	$	(155	)
Amounts recognized in Accumulated other comprehensive income (loss), pre-tax
Net actuarial (gain) loss	$	(1	)	$	12		$	—		$	—
	$	(1	)	$	12		$	—		$	—
Amounts recognized in Regulatory assets^(a)
Net actuarial loss	$	279		$	300		$	211		$	217
Prior service credit	(1		)	(14		)	—			(10		)
	$	278		$	286		$	211		$	207

______________________________________


(a)	See Note 9 to the Consolidated Financial Statements, "Regulatory Matters."

At December 31, 2017, the benefits expected to be paid, including prescription drug benefits, in each of the next five years and in the aggregate for the five fiscal years thereafter for the Registrants are as follows:



	DTE Energy		DTE Electric
	(In millions)
2018	$	94	$	73
2019	99		77
2020	103		80
2021	105		82
2022	108		84
2023-2027	567		437
Total	$	1,076	$	833

Assumptions used in determining the accumulated postretirement benefit obligation and net other postretirement benefit costs of the Registrants are:



	2017	2016	2015
Accumulated postretirement benefit obligation
Discount rate	3.70%	4.25%	4.50%
Health care trend rate pre- and post- 65	6.75 / 7.25%	6.50 / 6.75%	6.25 / 6.75%
Ultimate health care trend rate	4.50%	4.50%	4.50%
Year in which ultimate reached pre- and post- 65	2030	2028	2027
Other postretirement benefit costs
Discount rate	4.25%	4.50%	4.10%
Expected long-term rate of return on plan assets	7.75%	8.00%	8.00%
Health care trend rate pre- and post- 65	6.50 / 6.75%	6.25 / 6.75%	7.50 / 6.50%
Ultimate health care trend rate	4.50%	4.50%	4.50%
Year in which ultimate reached pre- and post- 65	2028	2027	2025 / 2024

A one percentage point increase in health care cost trend rates would have increased the total service cost and interest cost components of benefit costs for DTE Energy by $5 million, including $4 million for DTE Electric, in 2017 and would have increased the accumulated benefit obligation for DTE Energy by $97 million, including $72 million for DTE Electric, at December 31, 2017. A one percentage point decrease in the health care cost trend rates would have decreased the total service and interest cost components of benefit costs for DTE Energy by $4 million, including $3 million for DTE Electric, in 2017 and would have decreased the accumulated benefit obligation for DTE Energy by $84 million, including $63 million for DTE Electric, at December 31, 2017.

The process used in determining the long-term rate of return for assets and the investment approach for the other postretirement benefit plans is similar to those previously described for the pension plans.

Target allocations for the Registrants' other postretirement benefit plan assets as of December 31, 2017 are listed below:



U.S. Large Cap Equity Securities	16	%
U.S. Small Cap and Mid Cap Equity Securities	4
Non-U.S. Equity Securities	20
Fixed Income Securities	26
Hedge Funds and Similar Investments	20
Private Equity and Other	14
	100	%

The following tables provide the fair value measurement amounts for the Registrants' other postretirement benefit plan assets at December 31, 2017 and 2016^(a):



	December 31, 2017											December 31, 2016
	Level 1			Level 2			Other^(b)		Total			Level 1			Level 2			Other^(b)		Total
DTE Energy asset category:	(In millions)
Short-term Investments^(c)	$	13		$	2		$	—	$	15		$	39		$	1		$	—	$	40
Equity Securities
U.S. Large Cap^(d)	284			—			—		284			284			—			—		284
U.S. Small Cap and Mid Cap^(e)	131			—			—		131			156			—			—		156
Non-U.S.^(f)	288			1			77		366			262			1			61		324
Fixed Income Securities^(g)	29			324			130		483			15			299			125		439
Hedge Funds and Similar Investments^(h)	116			—			219		335			114			—			224		338
Private Equity and Other⁽ⁱ⁾	—			—			234		234			—			—			177		177
Securities Lending^(j)	(39		)	(1		)	—		(40		)	(28		)	(3		)	—		(31		)
Securities Lending Collateral^(j)	39			1			—		40			28			3			—		31
DTE Energy Total	$	861		$	327		$	660	$	1,848		$	870		$	301		$	587	$	1,758

DTE Electric asset category:
Short-term Investments^(c)	$	9		$	1		$	—	$	10		$	28		$	1		$	—	$	29
Equity Securities
U.S. Large Cap^(d)	195			—			—		195			195			—			—		195
U.S. Small Cap and Mid Cap^(e)	91			—			—		91			109			—			—		109
Non-U.S.^(f)	200			1			52		253			182			1			41		224
Fixed Income Securities^(g)	20			218			92		330			10			203			90		303
Hedge Funds and Similar Investments^(h)	80			—			150		230			80			—			154		234
Private Equity and Other⁽ⁱ⁾	—			—			163		163			—			—			124		124
Securities Lending^(j)	(27		)	(1		)	—		(28		)	(20		)	(1		)	—		(21		)
Securities Lending Collateral^(j)	27			1			—		28			20			1			—		21
DTE Electric Total	$	595		$	220		$	457	$	1,272		$	604		$	205		$	409	$	1,218

_______________________________________


(a)	For a description of levels within the fair value hierarchy see Note 12 to the Consolidated Financial Statements, "Fair Value."


(b)	Amounts represent assets valued at NAV as a practical expedient for fair value.


(c)	This category predominantly represents certain short-term fixed income securities and money market investments that are managed in separate accounts or commingled funds. Pricing for investments in this category are obtained from quoted prices in actively traded markets or valuations from brokers or pricing services.


(d)	This category represents portfolios of large capitalization domestic equities. Investments in this category are exchange-traded securities whereby unadjusted quote prices can be obtained.


(e)	This category represents portfolios of small and medium capitalization domestic equities. Investments in this category are exchange-traded securities whereby unadjusted quote prices can be obtained.


(f)	This category primarily consists of portfolios of non-U.S. developed and emerging market equities. Investments in this category are exchange-traded securities whereby unadjusted quote prices can be obtained. Exchange-traded securities held in a commingled fund are classified as NAV assets.


(g)	This category includes corporate bonds from diversified industries, U.S. Treasuries, bank loans, and mortgage backed securities. Pricing for investments in this category is obtained from quoted prices in actively traded markets and quotations from broker or pricing services. Non-exchange traded securities and exchange-traded securities held in commingled funds are classified as NAV assets.


(h)	This category utilizes a diversified group of strategies that attempt to capture financial market inefficiencies and includes publicly traded mutual funds, commingled funds and limited partnership funds. Pricing for mutual funds in this category is obtained from quoted prices in actively traded markets. Commingled funds and limited partnership funds are classified as NAV assets.


(i)	This category includes a diversified group of funds and strategies that primarily invests in private equity partnerships. This category also includes investments in timber and private mezzanine debt. All investments in this category are classified as NAV assets.


(j)	The Registrants have a securities lending program with a third-party agent. The program allows the agent to lend certain securities from the Registrants' VEBA trust to selected entities against receipt of collateral (in the form of cash) as provided for and determined in accordance with their securities lending agency agreements.

The DTE Energy Company Master VEBA Trust holds debt and equity securities directly and indirectly through commingled funds and institutional mutual funds. Exchange-traded debt and equity securities held directly are valued using quoted market prices in actively traded markets. The commingled funds and institutional mutual funds hold exchange-traded equity or debt securities and are valued based on NAVs. Non-exchange traded fixed income securities are valued by the trustee based upon quotations available from brokers or pricing services. A primary price source is identified by asset type, class, or issue for each security. The trustee monitors prices supplied by pricing services and may use a supplemental price source or change the primary price source of a given security if the trustee challenges an assigned price and determines that another price source is considered preferable. The Registrants have obtained an understanding of how these prices are derived, including the nature and observability of the inputs used in deriving such prices. Additionally, the Registrants selectively corroborate the fair values of securities by comparison of market-based price sources.

There were no significant transfers between Level 2 and Level 1 in the years ended December 31, 2017 and 2016 for either of the Registrants.

Defined Contribution Plans

The Registrants also sponsor defined contribution retirement savings plans. Participation in one of these plans is available to substantially all represented and non-represented employees. For substantially all employees, the Registrants match employee contributions up to certain predefined limits based upon eligible compensation and the employee’s contribution rate. Additionally, for eligible represented and non-represented employees who do not participate in the Pension Plans, the Registrants annually contribute an amount equivalent to 4% (8% for certain DTE Gas represented employees) of an employee's eligible pay to the employee's defined contribution retirement savings plan. For DTE Energy, the cost of these plans was $57 million, $51 million, and $49 million for the years ended December 31, 2017, 2016, and 2015, respectively. For DTE Electric, the cost of these plans was $27 million for the year ended December 31, 2017, and $23 million for the years ended December 31, 2016 and 2015.

Plan Changes

In 2015, certain executive retirement benefit plans were amended to transfer the obligation for benefits as attributed to the LLC. The related plan liabilities were transferred from DTE Electric and DTE Gas to the LLC and DTE Energy. The related Rabbi Trust assets were also transferred to DTE Energy from DTE Electric.