DEF 14A 1 def14a2021.htm DEF 14A Document

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
 
 
SCHEDULE 14A
Proxy Statement Pursuant to Section 14(a) of the
Securities Exchange Act of 1934
(Amendment No.    )
 
 
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ý Definitive Proxy Statement
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¨ Soliciting Material Pursuant to §240.14a-12
DTE Energy Company
(Name of Registrant as Specified In Its Charter)
 
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
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LETTER TO SHAREHOLDERS
Fellow Shareholders,
We invite you to attend our company’s annual meeting of shareholders, which will be held virtually on Thursday, May 20, 2021. Please see page 73 for details on attending.

2020 was a year of extraordinary circumstances and historic challenges. In the face of great adversity, our employees responded in remarkable ways, meeting and exceeding many of our company’s goals and delivering what matters most: safe, caring, dependable service - and affordable energy - to our customers.

We focused our COVID-19 pandemic response on keeping our DTE family and our customers safe and healthy. Our most critical employees volunteered to be sequestered from their family and friends to ensure safe and uninterrupted natural gas and electric service. Their commitment to our customers and communities continues to inspire us all. Despite challenges and changes due to the pandemic, we achieved one of the best industrial safety records in the industry and in our company’s history.

We also made progress on our journey to achieve world-class service. Our employees embraced and activated our new Service Key behaviors of being Safe, Caring, Dependable and Efficient in their everyday service to our customers and each other. We streamlined our energy assistance programs to keep our customers – especially those with the least resources – safe and warm. We were recognized by J.D. Power as number one in the Midwest for gas residential customer satisfaction.

During the pandemic, the DTE Energy Foundation continued to invest in our communities and support people most impacted by the virus. We provided Detroit public school students with 50,000 tablets and internet service to ensure their continued learning at home. We also donated more than two million masks and other personal protective equipment to hospitals, police and firefighters.

Our focus on serving our customers and employees enabled us to deliver for you, our investors. We increased our financial guidance, achieving 14 percent EPS growth. Analysts responded favorably to our plans to spin-off our Midstream business and become a pure play utility. We also announced $17 billion of planned utility capital investments over the next five years. These investments will continue to drive our commitment to provide safe, reliable, affordable and even cleaner energy.

Our ability to achieve remarkable results in a year of extreme hardship is a testament to our company’s strength and the hard work and dedication of our people. Our accomplishments in 2020 position DTE for growth and success in 2021, 2022 and beyond. We thank you for your continued partnership and investment in DTE.
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Ruth G. Shaw
Gerardo Norcia
Lead Independent Director
President and Chief Executive Officer



DTE Energy Company
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One Energy Plaza
Detroit, Michigan 48226

2021 Notice of Annual Meeting of Shareholders and Proxy Statement
Meeting Date:Time:Location:
Thursday, May 20, 20218:00 a.m. (EDT)Virtual Only

We invite you to attend the annual meeting of DTE Energy Company. In response to ongoing public health concerns related to the COVID-19 pandemic, and to protect the health and safety of shareholders and other meeting participants, our 2021 annual meeting will be held in a virtual-only format. See page 73 for details on how to attend.
Agenda:
1Elect twelve directors;
2Ratify the appointment of PricewaterhouseCoopers LLP by the Audit Committee of the Board of Directors as our independent registered public accounting firm for the year 2021;
3Provide an advisory vote to approve executive compensation;
4.Vote on a management proposal to amend and restate the Long-Term Incentive Plan to authorize additional shares;
5.Vote on a shareholder proposal, if properly presented, to make additional disclosure of political contributions;
6.Vote on a shareholder proposal, if properly presented, to publish a greenwashing audit; and
7.Consider any other business that may properly come before the meeting.
Only shareholders of record at the close of business on March 23, 2021, the record date for this meeting, or their representatives authorized by proxy may attend or vote at the meeting.
This 2021 Notice of Annual Meeting, as well as the accompanying proxy statement and proxy card, will be first sent or given to our shareholders on or about April 7, 2021.
This year we have conserved resources and reduced costs by mailing a meeting notice to many of our registered and beneficial shareholders containing instructions on how to access our proxy statement and annual report on Form 10-K and vote online or how to request a paper copy. Shareholders who receive that meeting notice will not receive a paper copy of the proxy statement and annual report on Form 10-K or a proxy card unless they request one.
Every vote is important. You may vote your shares (1) by telephone, (2) via the Internet, (3) if you received a paper copy, by completing and mailing the enclosed proxy card in the return envelope or (4) at the annual meeting. Specific instructions for voting by telephone or via the Internet are attached to the proxy card or to the meeting notice that you received if you did not receive a paper copy. If you attend the meeting and vote at it, your vote at the meeting will replace any earlier vote by telephone, Internet or proxy. If you wish to attend the virtual annual meeting, you must register in advance. Please follow the instructions on page 73 to register to attend.
By Order of the Board of Directors
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Lisa A. Muschong
Vice President, Corporate Secretary & Chief of Staff March 25, 2021
  
Important Notice Regarding the Availability of Proxy Materials
for the Annual Meeting of Shareholders to Be Held on May 20, 2021:
The proxy statement and annual report are available to security holders free of charge at
proxydocs.com/dte



TABLE OF CONTENTS
A-1




PROXY STATEMENT SUMMARY
DTE Energy Aspiration and System of Priorities

At DTE Energy Company (“DTE Energy,” the “Company,” “we,” “us” or “our”), we aspire to be the best-operated energy company in North America and a force for growth and prosperity in the communities where we live and serve. This aspiration drives everything we do and has led us to develop a system of corporate priorities that guide our daily, monthly and annual plans which help us to achieve this aspiration. Our Board of Directors (the “Board”) evaluates our Company’s and executives’ performance based upon goals that align with this system of priorities, and we will refer to this system of priorities as we discuss DTE Energy’s performance and our compensation programs throughout this proxy statement.

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Becoming the best-operated energy company means having great corporate governance, competitive compensation and excellent shareholder relations.
Governance Highlights
The Board is committed to creating long-term value for our shareholders while operating in an ethical, legal, environmentally sensitive and socially responsible manner. The Board follows sound governance practices, some of which are highlighted below. For more detail, see the “Corporate Governance” section of this proxy statement.
Ten of twelve director nominees, 83%, are independent; our Executive Chairman and our President & Chief Executive Officer ("CEO") are the only management directors.
All Board committees are composed exclusively of independent directors.
We have implemented a proxy access provision, which makes it possible for a group of shareholders meeting certain criteria to nominate and include in the Company’s proxy materials a candidate for the Board.


DTE ENERGY 2021 PROXY STATEMENT 1


We have a Lead Independent Director, elected by the independent members of the Board. The Lead Independent Director maintains final approval authority over Board agendas, meeting materials and schedules. The Lead Independent Director is also available for consultation and direct communication with large shareholders.
Independent directors met in executive sessions chaired by the Lead Independent Director at seven of the nine 2020 Board meetings.
All of our directors are elected annually.
We have a majority vote requirement for uncontested director elections.
The Board and its committees conduct annual self-assessments. In addition, each independent director who has served for one year or more undergoes an annual peer review.
Our executive officers and directors are all subject to robust stock ownership requirements.
We have instituted anti-hedging policies applicable to all Company directors, officers and employees.
Our Board’s Mission and Governance Guidelines recommend that the Board consider diversity of characteristics including experience, gender, race, ethnicity and age when evaluating nominees for the Board.
We limit our directors who are employed by public companies to a total of not more than two public company boards and all other directors to a total of not more than four public company boards.
Performance Highlights
The Company continued to deliver on its objectives to provide strong earnings per share and dividend growth in 2020, while maintaining a strong balance sheet, employee engagement and improving customer service. Some highlights of the Company’s 2020 performance include:

Increased our dividend payment to $4.05 per share in 2020, representing a 7.8% increase over the dividend in 2019.
Provided our shareholders with a five-year total shareholder return of 179% (indexed with 2015 as the base year = 100%).
Delivered cash from operations of $3.7 billion in 2020.
Achieved 8.3% compound operating earnings per share growth during the five years ending in 2020 (see discussion below).
DTE Energy management believes that operating earnings provide a more meaningful representation of the Company's earnings from ongoing operations and uses operating earnings as the primary performance measurement internally and externally. Operating earnings can be reconciled to our reported earnings as set forth in the following table:
20202015
Reported Earnings per Share$7.08 $4.05 
MPSC disallowance of capital expenses (incentive compensation)0.24 
Shift premiums and incremental costs from COVID-19 sequestration0.08 
Midstream post-acquisition settlement(0.10)
Midstream spin-off transaction costs0.04 
Settlement charge related to non-regulated qualified pension plan0.11 
Certain mark-to-market transactions0.02 0.26 
Income tax-related adjustments(0.28)
PSCR disallowance0.07 
Tree trimming disallowance0.05 
Contract termination0.05 
Plant Closure0.39 
Natural gas pipeline refund(0.05)
Operating Earnings per Share$7.19 $4.82 
2 DTE ENERGY 2021 PROXY STATEMENT


Executive Compensation Highlights
Our executive compensation programs are designed to be competitive with our peers, have a meaningful performance component linked to the achievement of short-term and long-term goals that align with our shareholders’ long-term interests and encourage executives to have an ownership interest in the Company. Our President and CEO’s total compensation shows strong pay-for-performance alignment with growth in long-term shareholder value creation. Our CEO’s compensation growth trend is consistent with the growth in value of a $100 investment in DTE Energy Company stock made in 2015.
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201820192020
              
CEO Total Compensation ($000s)10,9878,22810,606
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Total Shareholder Return (Indexed, Base Period 2015=100)151.54183.91178.57
The Company’s compensation programs are also designed to clearly align performance objectives for our Named Executive Officers with the interests of shareholders and with our system of priorities. Our performance measures are designed to help move our Company toward achieving these priorities. For more details, see our priorities alignment chart in the Compensation Discussion and Analysis Summary on page 37.
Other highlights from our compensation program include:
 
Our CEO received 64% of his 2020 total compensation in contingent, performance-based incentives. For our other Named Executive Officers, the average percentage of contingent, performance-based compensation was 40%. See more details on page 38.
Our short-term and long-term performance metrics all tie directly to our system of priorities (see above). These are the same metrics that management uses to assess the Company’s progress toward our aspiration of becoming the best-operated energy company in North America and a force for growth and prosperity in the communities where we live and serve.
Our long-term plan awards include a mix of restricted stock and performance shares designed in part to encourage executive stock ownership. The Board’s Organization and Compensation Committee has not issued stock options since 2010.
Our equity compensation plan forbids buyouts of “underwater” stock options. The Company has never bought or repriced “underwater” stock options.
Our equity compensation plan requires a minimum one-year vesting period for equity awards. The Company’s typical practice is to require a three-year vesting period for equity awards and the Company has never issued equity awards with less than a one-year vesting period.
Our Board has adopted a “clawback” policy that provides that, in the event of an accounting restatement due to material noncompliance with federal securities laws, the Company may recover excess performance-based compensation awarded to current or former officers during the three-year period preceding the restatement.


DTE ENERGY 2021 PROXY STATEMENT 3


Our executive Change-In-Control Severance Agreements do not include excise tax gross-ups.
We have eliminated the automatic vesting of equity issued under our Long-Term Incentive Plan upon a change in control of the Company, unless an acquiring or surviving entity fails to replace or affirm the existing equity awards with awards by the surviving company.
Shareholder Engagement
We have continued our shareholder engagement activities this year and, as a result of those discussions, we’ve learned a lot about what is important to our shareholders. The shareholder engagement team consists of members from the Corporate Secretary's office, the General Counsel organization, Investor Relations, Environmental Management, and Corporate Communications. Shareholder engagement is a year-round process for us.
Every spring we reach out to large shareholders to discuss issues related to proxy season and the proposals to be presented at our annual meeting. In the fall we conduct another round of conversations to discuss general governance issues and trends. We also discuss pressing matters on an ad hoc basis.
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Our shareholder engagement activities help us identify governance and compensation policies and practices that are most important to our shareholders.
The shareholder engagement team reports directly to the Corporate Governance Committee and other committees as needed, conveying the feedback received from shareholders and proposing implementation of best practices.The committees and the full Board of Directors deliberate over proposed governance changes, adopt best practices and provide guidance to the shareholder engagement team in their communications with shareholders.
In 2020, the Company held discussions with shareholders who collectively own or exercise voting control over 40% of the Company’s outstanding shares. In addition, the Company routinely contacts shareholders who have submitted proposals for inclusion in our annual proxy statement in an effort to understand their concerns and to address, where possible, the issues behind their proposals. We will continue to look for opportunities to provide more information about the Company’s approach on topics of interest to shareholders, and to stimulate more conversations with shareholders.

Items for Shareholder Vote at this Meeting
At the 2021 Annual Meeting shareholders will vote on the following proposals:
Proposal 1: Elect twelve members of the Board of Directors for one year terms ending in 2022;
Proposal 2: Ratify the appointment of PricewaterhouseCoopers LLP as our independent auditors;
Proposal 3: Provide a nonbinding vote to approve the Company’s executive compensation;
Proposal 4: Vote on a management proposal to amend and restate the Long-Term Incentive Plan to authorize additional shares;
Proposal 5: Vote on a shareholder proposal to make additional disclosure of political contributions;
Proposal 6: Vote on a shareholder proposal to publish a greenwashing audit.
Shareholders may vote on any other matter that properly comes before the meeting.
4 DTE ENERGY 2021 PROXY STATEMENT


Proposal No. 1 — Election of Directors
The Board of Directors has nominated twelve directors for election at the 2021 annual shareholder meeting. Directors are elected to serve annual terms which expire when their successors are elected at the next year’s annual shareholder meeting. All of the nominees are currently directors of the Company.
Proxies cannot be voted for more than twelve persons at this meeting. If any nominee becomes unable or unwilling to serve at the time of the meeting, the persons named in the enclosed proxy card have discretionary authority to vote for a substitute nominee or nominees. It is anticipated that all nominees will be available for election.

The biography of each of the nominees below contains information regarding the person’s service as a director, business experience and director positions held currently or at any time during at least the last five years. The age provided for each director is as of March 25, 2021. In addition to the information presented below regarding each person’s experience, qualifications, attributes and skills that caused our Corporate Governance Committee and Board to determine that the person should serve as a director, the Board believes that all of the Company’s directors have a reputation for integrity, honesty and adherence to high ethical standards. They each have demonstrated business acumen, strategic insight, an ability to exercise sound judgment and a commitment to service and community involvement. Finally, we value their significant experience on other public company boards of directors and board committees and the diversity that they bring to our Board. The following graphs display information about the skills and experience our Board members bring to their service:
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DTE ENERGY 2021 PROXY STATEMENT 5


The Board's demographic makeup is set forth below:
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The biographies below disclose the committees on which each director serves. The following abbreviations are used to denote each committee: Corp Gov=Corporate Governance; O&C=Organization and Compensation; Nuc Rev=Nuclear Review; and PPRC=Public Policy & Responsibility.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR THE NOMINEES FOR ELECTION AT THIS MEETING.

6 DTE ENERGY 2021 PROXY STATEMENT


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Gerard M. Anderson
David A. Brandon
Executive Chairman, DTE Energy Company
Non-Executive Chairman, Domino's Pizza, Inc.
(2019-present)(2011-present)
Not Independent
Independent
DTE Committees:
Age: 62Age: 68O&C (Chair)
Director since: 2009Director since: 2010
Finance
PPRC
Previous Experience
Previous Experience
DTE Energy Company—Chairman (2011-2019); CEO
Toys "R" Us, Inc.—Chairman and CEO (2015-2018)*
(2010-2019); President (2004-2013); COO (2005-
University of Michigan—Athletic Director (2010-2014)
2010); Executive VP (1997-2004)
Domino's Pizza, Inc.—Special Advisor (2010-2011)
McKinsey & Co.—Senior Consultant (1988-1993)
Chairman and CEO (1999-2010)
Other Public Boards
Other Public Boards
The Andersons, Inc. (2008-present)
Domino's Pizza, Inc. (1999-present)
Herman Miller, Inc. (2011-present)
Qualifications
Kaydon Corporation (2004-2013)
Energy Industry Experience
DTE Energy CEO for nine years and COO for five
Qualifications
years
CEO Experience
Growth and Value Creation
Service as chief executive of large public companies
Extensive experience in strategic planning and
Customer Service and Satisfaction
corporate business development
Extensive experience in marketing and sales
Operations and Continuous Improvement
Financial Planning and Review
Broad experience managing capital-intensive
Strong skill sets in corporate finance and strategic
industries
planning
Executive Compensation
Experience in executive compensation and
organizational best practices
*In September 2017, Toys "R" Us, Inc. filed a voluntary petition for reorganization under Chapter 11 of the U.S. Bankruptcy Code.


DTE ENERGY 2021 PROXY STATEMENT 7


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Charles G. McClure, Jr.
Gail J. McGovern
Managing Partner, Michigan Capital Advisors
President and CEO, American Red Cross
(a private equity firm)(2014-present)(2008-present)
Independent
DTE Committees:
Independent
DTE Committees:
Age: 67
Audit
Age: 69O&C
Director since: 2012
Corp Gov (Chair)
Director since: 2003
Finance
Nuc Rev
Previous Experience
Previous Experience
Meritor, Inc.—Chairman of the Board, CEO and
Harvard Business School—Professor (2002–2008)
 President (2004–2013)
Fidelity Personal Investments (a unit of Fidelity
Federal-Mogul Corporation—CEO (2003–2004),
Investments—President (1998–2002)
President and COO (2001–2003)
Detroit Diesel Corporation—President and CEO
Other Public Boards
(1997-2000)
PayPal Holdings, Inc. (2015–present)
eBay Inc. (2015)
Other Public Boards
Crane Co. (2017–present)
Qualifications
3D Systems Inc. (2017–present)
CEO Experience
Remy International, Inc. (2015)
Top executive of major non-profit organization
Meritor, Inc. (2004–2013)
Customer Service and Satisfaction
Extensive executive experience in marketing, sales
Qualifications
and customer relations
CEO Experience
Growth and Value Creation
CEO, president and director of several major
Experience in strategic planning and corporate
domestic and international corporations
finance
Operations and Continuous Improvement
Broad knowledge of business and industry
Employee Engagement, Safety and Talent
Extensive proven leadership skills and service on
boards of industry organizations
8 DTE ENERGY 2021 PROXY STATEMENT


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Mark A. Murray
Gerardo Norcia
Retired Vice Chairman, Meijer, Inc.
CEO (2019-present) and President (2016-
(2013-2020)present
Independent
DTE Committees:
Not Independent
Age: 66
Nuc Rev (Chair)
Age: 58
Director since: 2009
PPRC
Director since: 2019
Previous Experience
Previous Experience
Meijer, Inc.—President (2006–2013), Co-CEO
DTE Electric—President and COO (2013-2016)
(2013–2016) Executive Vice-Chair (2016-2020)
DTE Gas—President and COO (2007-2013)
Grand Valley State University—President (2001–2006)
DTE Gas Storage and Pipelines—President and COO
State of Michigan—Treasurer (1999–2001)
(2002-2007)
Michigan State University—VP of Finance and
Administration (1998–1999)
Qualifications
Energy Industry Experience
Other Public Boards
More than 30 years of leadership in business
Fidelity Fixed Income and Asset Allocation
development, engineering and operations
(2016–present)
Operations and Continuous Improvement
Universal Forest Products, Inc. (2004–2016)
Extensive experience in customer relations, strategic
planning and operational efficiency
Qualifications
Employee Engagement, Safety and Talent
CEO Experience
Broad experience with human capital management
President and Co-CEO of a major Michigan-based
and safety leadership
corporation
Financial Planning and Review
Strategic planning, corporate development and
finance experience
Government, Regulatory and Community
University president and state government official


DTE ENERGY 2021 PROXY STATEMENT 9


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Ruth G. Shaw
Robert C. Skaggs, Jr.
Retired Group Executive, Public Policy and
Retired Chairman and CEO, Columbia Pipeline
President, Duke Nuclear, Duke Energy Group, Inc.
(2003-2009)(2015-2016)
Independent
DTE Committees:
Independent
DTE Committees:
Age: 73
Corp Gov
Age: 66
Finance
Director since: 2008
Nuc Rev
Director since: 2017
Nuc Rev
O&C
O&C
Previous Experience
Previous Experience
Duke Energy—Executive Advisor (2007–2009)
NiSource, Inc.—President (2004–2015) and CEO
Duke Nuclear—Group Executive for Public Policy
(2005–2015)
and President (2006–2007)
Duke Power Company—President and CEO (2003–2006)
Other Public Boards
Team, Inc. (2019-present)
Other Public Boards
Cloud Peak Energy, Inc. (2015–2019)
SPX Corporation (2015–present)
Columbia Pipeline Group, Inc. (2014–2015)
Dow, Inc. (2005–2020)
NiSource, Inc. (2005–2015)
Qualifications
Qualifications
Energy Industry Experience
CEO Experience
Extensive experience in the nuclear and energy
Extensive executive leadership experience in the
industries
utility sector
Corporate Governance
Energy Industry Experience
Service on corporate boards and industry
Broad experience in natural gas and electric
associations and organizations
generation, transmission, storage and distribution
Government, Regulatory and Community
Government, Regulatory and Community
Broad knowledge of regulatory matters, public
Experience developing regulatory strategies and
policy and corporate communications
leading external relations
10 DTE ENERGY 2021 PROXY STATEMENT


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David A. Thomas
Gary H. Torgow
President, Morehouse College
Executive Chairman, TCF Financial Corporation
(2018-present)(2019-present)
Independent
DTE Committees:
Independent
DTE Committees:
Age: 64AuditAge: 64
Finance
Director since: 2013
PPRC
Director since: 2019
PPRC
Previous Experience
Previous Experience
Harvard Business School—H. Naylor Fitzhugh
Chemical Financial Corporation—Chairman
Professor of Business Administration (2016–2017,
(2016-2019)
1990–2011)
Talmer Bancorp, Inc.—Chairman (2009-2016)
Georgetown University McDonough School of
Business—Dean and William R. Berkeley Professor of
Other Public Boards
Business Administration (2011-2016)
TCF Financial Corporation (2019-present)
Wharton School of Finance—Assistant Professor of
Chemical Financial Corporation (2016-2019)
Management (1986–1990)
Talmer Bancorp, Inc. (2009-2016)
Qualifications
Qualifications
Employee Engagement, Safety and Talent
Leadership Experience
Leadership and research in corporate inclusion and
Chairman and executive experience in publicly
diversity
held companies
Corporate Governance
Financial Planning and Review
Service on various civic and educational boards,
Financial accounting for complex organizations
advisor to other corporate boards
and publicly held companies
Executive Experience as senior level higher education
Growth and Value Creation
administrator
Strong skill sets in corporate finance, community
Expertise in executive development and strategic
relations, strategic planning and corporate/business
human resource management
development


DTE ENERGY 2021 PROXY STATEMENT 11


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James H. Vandenberghe
Valerie M. Williams
Retired Vice chairman and former Director,
Retired Southwest Assurance Managing
Lear Corporation (1998-2008)Partner, Ernst & Young LLP (2009-2016)
Independent
DTE Committees:
Independent
DTE Committees:
Age: 71
Audit
Age: 64
Audit (Chair)
Director since: 2006
Corp Gov
Director since: 2018
Corp Gov
Finance (Chair)
Previous Experience
Previous Experience
Lear Corporation—President and COO (1997–1998),
Ernst & Young, LLP—Southwest AABS Managing
CFO (1988–1997, 2006–2007)
Partner (2006–2009)
Ernst & Young, LLP—National Office Professional
Other Public Boards
Practice Partner (2005)
Federal-Mogul Corporation (2008–2013)
Lear Corporation (1995–2008)
Other Public Boards
Devon Energy Corporation (2021-present)
Qualifications
Omnicom Group Inc. (2016-present)
Growth and Value Creation
WPX Energy, Inc. (2018-2021)
Extensive experience in strategic planning and
managing capital-intensive industries
Qualifications
Financial Planning and Review
Financial Planning and Review
Broad experience with public and financial
Significant financial reporting expertise for complex
accounting for complex organizations
organizations
Corporate Governance
Leadership experience in audit practice and risk
management
Growth and Value Creation
Experience in oversight of operations and strategy
development
12 DTE ENERGY 2021 PROXY STATEMENT


Corporate Governance
Governance Guidelines
At DTE Energy, we are committed to operating in an ethical, legal, environmentally sensitive and socially responsible manner, while creating long-term value for our shareholders. The foundation of our governance practices begins at the top, with the DTE Energy Board of Directors Mission and Guidelines (“Governance Guidelines”). The Governance Guidelines set forth the practices the Board follows with respect to Board composition and selection, Board meetings, the performance evaluation and succession planning for DTE Energy’s Chief Executive Officer, Board committees, Board compensation and communicating with the Board, among other things. The Governance Guidelines are also intended to align the interests of directors and management with those of our shareholders. The following is a summary of the Governance Guidelines, along with other governance practices at DTE Energy.
Election of Directors and Vacancies
The Company has a declassified board of directors. Directors are elected annually for terms which expire upon election of their successor at the next year’s annual shareholder meeting.
If a vacancy on the Board occurs between annual shareholder meetings, the vacancy may be filled by a majority vote of the directors then in office. The new director’s term will expire upon election of their successor at the next year’s annual shareholder meeting.
Under the Governance Guidelines, the Corporate Governance Committee periodically assesses the skills, characteristics and composition of the Board, along with the need for expertise and other relevant factors as it deems appropriate. In light of these assessments, and in light of the standards set forth in the Governance Guidelines, the Corporate Governance Committee may seek candidates with specific qualifications and candidates who satisfy other requirements set by the Board. We believe our Board should be comprised of directors who have had high-level executive experience, have been directors on other boards and have been tested through economic downturns and crises. Industry experience, regional relationships and broad diversity of experience and backgrounds are also factors in Board nominee selection. The Board’s Governance Guidelines confirm that we believe it is desirable for Board members to possess diverse characteristics of gender, race, ethnicity and age, and we consider these factors in Board evaluation and in the identification of candidates for Board membership. We believe this type of composition enables the Board to oversee the management of the business and affairs of the Company effectively. Information about the skills, experiences and qualifications of our directors is included in their biographies beginning on page 7.
The Corporate Governance Committee considers candidates who have been properly nominated by shareholders, as well as candidates who have been identified by Board members and Company personnel. In addition, the Corporate Governance Committee may use a search firm to assist in the search for candidates and nominees and to evaluate the nominees’ skills against the Board’s criteria. Based on its review of all candidates, the Corporate Governance Committee recommends a slate of director nominees for election at the annual meeting of shareholders. The slate of nominees may include both incumbent and new nominees.

Potential candidates are reviewed and evaluated by the Corporate Governance Committee, and selected candidates go on to be interviewed by one or more Corporate Governance Committee members. An invitation to join the Board is extended by the Board itself, through the Chairman and the Chair of the Corporate Governance Committee.

Under our Bylaws, a group of up to 20 shareholders owning 3% or more of the Company’s outstanding common stock continuously for at least three (3) years may nominate and include in the Company’s proxy materials a candidate for the Board of Directors (a Shareholder Nominee), provided that the shareholder(s) and the nominee satisfy the requirements specified in the Bylaws. The total number of Shareholder Nominees that the Company must include in the Company’s proxy materials in a given year shall not exceed 20% of the number of directors in office at the time of the nomination.


DTE ENERGY 2021 PROXY STATEMENT 13


Composition of the Board
Our Governance Guidelines and our Bylaws state that the exact size of the Board will be determined by resolution of the Board from time to time. Our Board currently has twelve members.
Director Independence and Categorical Standards
As a matter of policy and in accordance with New York Stock Exchange (“NYSE”) listing standards, we believe that the Board should consist of a majority of independent directors. The Board must affirmatively determine that a director has no material relationship with the Company, either directly or indirectly, or as a partner, shareholder or officer of an organization that has a relationship with the Company. The Board has established the following categorical standards for director independence, which are more stringent than the NYSE independence standards for former Company executives:
A director for whom any of the following is true will not be considered independent:
 
A director who is currently, or has been at any time in the past, an employee of the Company or a subsidiary.
A director whose immediate family member is, or has been within the last three years, an executive officer of the Company.
A director who has received, or whose immediate family member has received, more than $120,000 in direct compensation from the Company during any twelve-month period within the last three years, other than director and committee fees and pension or other forms of deferred compensation for prior service (provided such compensation is not contingent in any way on continued service).
A director who is, or whose immediate family member is, a current partner of a firm that is the Company’s internal or external auditor; the director is a current employee of such a firm; the immediate family member is a current employee of such a firm and personally works on the Company’s audit; or the director or immediate family member was, within the last three years, a partner or employee of such a firm and personally worked on the Company’s audit within that time.
A director who is employed, or whose immediate family member is employed, or has been employed within the last three years, as an executive officer of another company where any of the Company’s present executives at the same time serves or served on that company’s compensation committee.
A director who is a current employee, or whose immediate family member is a current executive officer, of a company that has made payments to, or received payments from, the Company for property or services in an amount which, in any of the last three fiscal years, exceeds the greater of $1 million or 2% of such other company’s consolidated gross revenues is not independent until three years after the company falls below such threshold.
Contributions by the Company to a tax-exempt organization will not be considered to be a material relationship that would impair a director’s independence if a director serves as an executive officer of a tax-exempt organization and, within the preceding three years, contributions in any single fiscal year were less than $1 million or 2% of such tax-exempt organization’s consolidated gross revenues (whichever is greater).
Applying these standards and considering all relevant facts and circumstances, the Board has affirmatively determined that all of our director nominees other than Gerard M. Anderson and Gerardo Norcia qualify as independent and have no material relationship with the Company. The independent directors are David A. Brandon, Charles G. McClure, Jr., Gail J. McGovern, Mark A. Murray, Ruth G. Shaw, Robert C. Skaggs, Jr., David A. Thomas, Gary Torgow, James H. Vandenberghe, and Valerie M. Williams. Mr. Anderson and Mr. Norcia are not independent directors and may be deemed to be affiliates of the Company under the categorical standards. Mr. Anderson is not considered independent due to his current employment as Executive Chairman, and Mr. Norcia is not considered independent due to his current employment as President and Chief Executive Officer. There were no material relationships that the Board considered when determining the independence of the directors other than Mr. Anderson and Mr. Norcia.
14 DTE ENERGY 2021 PROXY STATEMENT


Assessment of Board and Committee Performance
The Board evaluates its performance annually. In addition, each Board committee performs an annual self-assessment to determine its effectiveness. Each Board member also performs an intensive annual peer review of the other directors who have served one year or more. The results of the Board and committee self-assessments are discussed with the Board and each committee, respectively. The results of the individual peer review are reviewed by the Chair of the Corporate Governance Committee and discussed with the Corporate Governance Committee. The Chair of the Corporate Governance Committee discusses the results of the peer review with individual directors, as directed by the Corporate Governance Committee.
Terms of Office
The Board has not established term limits for directors. We assure the independence and ongoing effectiveness of each independent director through the individualized peer assessment process described above, in which each Board member annually undergoes a rigorous evaluation by the other members. In addition, the Corporate Governance Committee of the Board has established policies that independent directors should not stand for election after attaining the age of 75, unless the Board waives this provision when circumstances exist which make it prudent to continue the service of the particular independent director. Directors who are retired CEOs of the Company or its subsidiaries shall not stand for election after attaining the age of 70. Except for the CEO, who may continue to serve as a director after retirement for so long as he is serving as Chairman, any other employees who are also directors will not stand for re-election after retiring from employment with the Company.
Election of the Executive Chairman; Lead Independent Director
Our Bylaws currently provide that the Chairman shall preside at all meetings of the Board, and that the Chairman can be either an independent or non-independent member of the Board. Our Bylaws also provide that the Chairman may simultaneously serve as the CEO of the Company, and that the independent members of the Board may elect an independent director as Lead Independent Director, which has been our practice since 2004.
The Board believes it is in the best interests of the Company and shareholders for the Board to have flexibility in determining whether to separate or combine the roles of Chairman and Chief Executive Officer based on the Company’s circumstances. The Board has strong governance structures and processes in place to ensure the independence of the Board, eliminate conflicts of interest and prevent dominance of the Board by senior management. The Governance Guidelines and various committee charters provide for independent discussion among directors and for independent evaluation of, and communication with, many members of senior management.
The Board members have considerable experience and knowledge regarding the challenges and opportunities facing the Company and shareholders. The Board believes, therefore, that it is prudent for Mr. Anderson, who previously served as the Company's Chief Executive Officer, to serve as Executive Chairman at this time. The Board believes that Mr. Anderson is well qualified through his experience and expertise to be the person who generally sets the agenda for (subject to the approval of the Lead Independent Director) and leads Board discussions of strategic issues for the Company.
With the Executive Chairman position held by Mr. Anderson, the Board continues to believe a good governance practice is to elect a Lead Independent Director from the independent directors. On May 9, 2019, the Board unanimously elected Ruth G. Shaw to serve as Lead Independent Director. The Lead Independent Director has such responsibilities as required under the NYSE listing standards, as well as such other responsibilities as determined by the Board. The Lead Independent Director serves in that capacity until replaced. There is no defined term of office, and the assignment does not rotate among the directors. The Lead Independent Director’s duties include:
 
Calling regularly scheduled executive sessions; presiding at Board executive sessions of non-management directors or independent directors; and providing feedback regarding such sessions, as appropriate, to the Executive Chairman and to the CEO;
Serving as the liaison between the Executive Chairman and the CEO and the independent directors;
Approving the general scope and type of information to be presented at Board meetings;


DTE ENERGY 2021 PROXY STATEMENT 15


Reviewing shareholder communications addressed to the Board or to the Lead Independent Director;
Making himself or herself available if requested by major shareholders, for direct consultation and communication with shareholders;
Organizing Board meetings in the absence of the Executive Chairman and presiding at any session of the Board where the Executive Chairman is not present;
Designating one or more directors as alternate members of any committee to replace an absent or disqualified member at any committee meeting, provided that, in the event an alternate member is designated for the Audit, Corporate Governance or Organization and Compensation Committee, the designate meets the Company’s categorical standards for director independence and SEC and NYSE requirements;
Consulting with the Executive Chairman in the selection of topics to be discussed when developing the annual Board calendar;
Retaining independent advisors in consultation with the Board, on behalf of the Board as the Board determines to be necessary or appropriate;
Participating in the Organization and Compensation Committee’s annual review and approval of the CEO’s corporate goals and objectives and evaluation of the CEO’s performance;
Approving Board meeting agendas after consulting with the Executive Chairman and the Corporate Secretary; and
Collaborating with the Executive Chairman and the Corporate Secretary on scheduling Board and committee meetings and approving the schedule of Board and Committee meetings.
Board Meetings and Attendance
The Board met nine times in 2020. All of the incumbent directors attended at least 90% of the Board meetings and the meetings of the committees on which they served, ten of whom had a 100% attendance record. The Board does not have a policy with regard to directors’ attendance at the annual meeting of shareholders. At the 2020 annual meeting, all twelve directors standing for election were in attendance.
Executive Sessions
It is the Board’s practice that the independent directors meet in executive session at most regular Board meetings and meet in executive session at other times whenever they believe it appropriate. The independent directors met in executive sessions (sessions without the Executive Chairman, the President and CEO, or any representatives of management present) at seven of the nine Board meetings in 2020. The independent directors meet in executive session on an annual basis to review the Organization and Compensation Committee’s performance review of the CEO. The Lead Independent Director chairs the executive sessions of the independent directors.
Codes of Business Conduct and Ethics
The DTE Energy Board of Directors Code of Business Conduct and Ethics, the Officer Code of Business Conduct and Ethics and the DTE Energy Way are the standards of behavior for Company directors, officers and employees. Any waiver of, or amendments to, the Board of Directors Code of Business Conduct and Ethics and the Officer Code of Business Conduct and Ethics as it pertains to the CEO, the Chief Financial Officer, senior financial officers and other Executive Officers, as defined in the “Security Ownership of Directors and Officers” section on page 26, will be disclosed promptly by posting such waivers or amendments on the Company website, dteenergy.com. There were no waivers or amendments during 2020.
16 DTE ENERGY 2021 PROXY STATEMENT


Communications with the Board
The Company has established several methods for shareholders or other non-affiliated persons to communicate their concerns to the directors. Concerns regarding auditing, accounting practices, internal controls, or other business ethics issues may be submitted to the Audit Committee through its reporting channel:
By telephone:By Internet:By mail:
877-406-9448ethicsinaction.dteenergy.com
For auditing, accounting, or internal control matters:
For business ethics issues:
DTE Energy CompanyDTE Energy Company
Audit CommitteeEthics and Employee Issues
One Energy PlazaOne Energy Plaza
Room 2431 WCBRoom 2188 WCB
Detroit, Michigan 48226-1279Detroit, Michigan 48226-1279
Any other concern may be submitted to the Corporate Secretary by mail for prompt delivery to the Lead Independent Director at:
Lead Independent Director
c/o Corporate Secretary
DTE Energy Company
One Energy Plaza
Room 2386 WCB
Detroit, Michigan 48226-1279
Periodically, we revise our governance information in response to changing regulatory requirements and evolving corporate governance developments. Current copies of the Governance Guidelines, committee charters, categorical standards of director independence and the codes of ethics referred to above are available on our website at dteenergy.com/governance. A copy of any or all of these documents and a copy of the Company’s Annual Report on Form 10-K may be requested, free of charge, by mailing a request to the Corporate Secretary, DTE Energy Company, One Energy Plaza, Room 2386 WCB, Detroit, Michigan 48226-1279.
The information on the Company’s website is not, and shall not be deemed to be, a part of this proxy statement or incorporated into any other filings the Company makes with the SEC.

Committees of the Board of Directors
The Board has standing committees for Audit, Corporate Governance, Finance, Nuclear Review, Organization and Compensation, and Public Policy and Responsibility. The Board committees act in an advisory capacity to the full Board, except that the Organization and Compensation Committee has direct responsibility for the CEO’s goals, performance and compensation along with compensation of other executives, and the Audit Committee has direct responsibility for appointing, replacing, compensating and overseeing the independent registered public accounting firm. Each committee has adopted a charter that clearly establishes the committee’s respective roles and responsibilities. In addition, each committee has authority to retain independent outside professional advisors or experts as it deems advisable or necessary, including the sole authority to retain and terminate any such advisors, to carry out its duties. The Board has determined that each member of the Audit, Corporate Governance, and Organization and Compensation Committees is independent under our categorical standards and that each member is free of any relationship that would interfere with his or her individual exercise of independent judgment. The Board has determined that each member of the Audit Committee meets the independence requirements under the SEC rules and NYSE listing standards applicable to audit committee members. The Board has also determined that each member of the Organization and Compensation Committee meets the independence requirements under the SEC rules and NYSE listing standards applicable to compensation committee members.


DTE ENERGY 2021 PROXY STATEMENT 17


The following is a summary of the terms of each committee’s charter and the responsibilities of its members:
Audit Committee (Nine meetings in 2020)
 
Assists the Board in its oversight of the quality and integrity of our accounting, auditing and financial reporting practices and the independence of the independent registered public accounting firm.
Reviews scope of the annual audit and the annual audit report of the independent registered public accounting firm.
Reviews financial reports, internal controls and financial and accounting risk exposures.
Discusses with management (a) earnings press releases and (b) material financial information and earnings guidance.
Reviews the policies, programs, performance and activities relating to the Company’s compliance and ethics programs.
Reviews accounting policies and system of internal controls.
Assumes responsibility for the appointment, replacement, compensation and oversight of the independent registered public accounting firm.
Reviews and pre-approves permitted non-audit functions performed by the independent registered public accounting firm.
Reviews the scope of work performed by the internal audit staff.
Reviews legal or regulatory requirements or proposals that may affect the committee’s duties or obligations.
Retains independent outside professional advisors, as needed.
The Board has determined that each member of the Audit Committee is financially literate and independent. The Board has reviewed the qualifications and experience of each of the Audit Committee members and determined that Ms. Williams and Mr. Vandenberghe qualify as “audit committee financial experts” as that term has been defined by the SEC.
Corporate Governance Committee (Four meetings in 2020)
 
Considers the organizational structure of the Board.
Identifies and reports to the Board risks associated with the Company’s governance practices and the interaction of the Company’s governance with enterprise risk management.
Recommends the nominees for directors to the Board.
Reviews recommended compensation arrangements for the Board, director and officer indemnification and insurance for the Board.
Reviews recommendations for director nominations received from shareholders.
Reviews shareholder proposals and makes recommendations to the Board regarding the Company’s response.
Reviews best practices in corporate governance and recommends corporate and Board policies/practices, as appropriate.
Retains independent outside professional advisors, as needed.
Finance Committee (Six meetings in 2020)
 
Reviews matters related to capital structure.
Reviews major financing plans.
Recommends dividend policy to the Board.
Reviews financial planning policies and investment strategy.
Reviews certain capital expenditures.
Reviews insurance and business risk management.
Receives reports on the strategy, investment policies, adequacy of funding and performance of post-retirement obligations.
Reviews certain potential mergers, acquisitions and divestitures.
Reviews investor relations activities.
Retains independent outside professional advisors, as needed.
18 DTE ENERGY 2021 PROXY STATEMENT


Nuclear Review Committee (Six meetings in 2020)
 
Provides non-management oversight and review of the Company’s nuclear power program.
Reviews the financial, operational, business and safety plans and performance at the Company’s nuclear facilities.
Reviews the policies, procedures and practices related to health and safety, potential risks, resources and compliance at the Company’s nuclear facilities.
Reviews the operating performance and key performance indicators and trends for the Company’s nuclear facilities.
Reviews non-financial audit findings related to the Company’s nuclear facilities or personnel.
Reviews the impact of changes in regulation on the Company’s nuclear facilities.
Retains independent outside professional advisors, as needed.

Organization and Compensation Committee (Four meetings in 2020)
 
Reviews the CEO’s performance and approves the CEO’s compensation.
Approves the compensation of certain other executives.
Administers the executive incentive plans and oversees the Company’s overall executive compensation and benefit plan philosophy, structure and practices, and the risks involved in executive compensation plans.
Reviews and approves executive employment agreements, severance agreements and change-in-control agreements, along with any amendments to those agreements.
Assesses and discusses with the Board the relationship between the inherent risk in executive compensation plans, executive compensation arrangements and executive performance goals and payouts, and how the level of risk corresponds to the Company’s business strategies.
Reviews the Compensation Discussion and Analysis disclosure and recommends inclusion in the Company’s annual report or proxy statement.
Reviews the Company’s policies and programs promoting diversity and inclusion among the Company’s employees and officers.
Recommends to the full Board the officers to be elected by the Board.
Reviews succession and talent planning.
Evaluates the independence of the independent compensation consultant at least annually.
Reviews and discusses with management any transactions with the independent compensation consultant or its affiliates.
Retains independent outside professional advisors, as needed.
Public Policy and Responsibility Committee (Five meetings in 2020)
 
Reviews and advises the Board on current and emerging social, economic, political and environmental issues.
Reviews management’s response to risk exposures related to regulatory, social, economic, political, reputational and environmental issues and advises the Board on management’s procedures for assessing, monitoring, controlling and reporting on such exposures.
Reviews the Company's programs and strategies related to environmental sustainability.
Reviews the Company’s policies on social responsibilities.
Reviews the Company’s policies and programs promoting diversity and inclusion among the Company’s suppliers.
Reviews the Company’s regulatory strategies and activities (including rate case strategies, rate competitiveness and environmental regulations) as well as its state and federal legislative and political activities and strategies.
Reviews reports from management regarding policies and safety issues related to customers and the general public.
Retains independent outside professional advisors, as needed.


DTE ENERGY 2021 PROXY STATEMENT 19


Board of Directors Risk Oversight Functions
The Board receives, reviews and assesses reports from the Board committees and from management relating to enterprise-level risks. Each Board committee is responsible for overseeing and considering risk issues relating to their respective committee and reporting their assessments to the full Board at each regularly scheduled Board meeting. When granting authority to management, approving strategies and receiving management reports, the Board and committees consider, among other things, the risks we face.
Each Board committee reviews management’s assessment of risk for that committee’s respective area of responsibility. As part of its oversight function, the Board discusses any risk conflicts that may arise between the committees or assigns to a committee risk issues that may arise which do not fall within a specific committee’s responsibilities.
Board Committee Areas of Risk Oversight
Audit Committee Overall review of risk issues, policies and controls associated with our overall financial reporting and disclosure process and legal compliance, and review policies on risk control assessment and accounting risk exposure, as well as cybersecurity risk.
Finance Committee Review of financial, capital, credit and insurance risk.
Organization and Compensation Committee Assess and discuss with the Board the relationship between the inherent risks in executive compensation plans, executive compensation arrangements and executive performance goals and payouts, and how the level of risk corresponds to the Company’s business strategies.
Corporate Governance Committee Review risks associated with the Company’s governance practices and the interaction of the Company’s governance with enterprise risk-level management.
Nuclear Review Committee Review risks relating to the operation of our nuclear power facilities.
Public Policy and Responsibility Committee Review risks associated with regulatory, social responsibility, political activity, economic conditions, reputation, safety and the environment.
All Board committees meet periodically with members of senior management to discuss the relevant risks and challenges facing the Company. In addition to its regularly scheduled Committee meetings, the Audit Committee meets with the Chief Financial Officer, the General Auditor and the independent registered public accounting firm in executive sessions at least semi-annually, and meets with the Chief Legal Officer and the Chief Compliance Officer at least annually in separate executive sessions. The Company’s General Auditor attends all Audit Committee meetings. The Treasurer and Chief Risk Officer meets annually with either the Audit Committee or the full Board to update the members on the Company’s enterprise-level risk management. The General Auditor and the Treasurer and Chief Risk Officer also periodically meet with the other Board committees and the full Board as may be required.
The Company also utilizes an internal Risk Management Committee, chaired by the CEO and comprised of the Chief Financial Officer, Chief Legal Officer, Treasurer and Chief Risk Officer, General Auditor and other senior officers. Among other things, the internal Risk Management Committee directs the development and maintenance of comprehensive risk management policies and procedures, and sets, reviews and monitors risk limits on a regular basis for enterprise-level risks, counter-party credit and commodity-based exposures.
The Board believes that the committee structure of risk oversight is in the best interests of the Company and its shareholders. Each committee member has expertise on risks relative to the nature of the committee on which he or she sits. With each committee reporting on risk issues at full Board meetings, the entire Board is in a position to assess the overall risk implications, to evaluate how they may affect the Company and to provide oversight on appropriate actions for management to take.
With regard to risk and compensation programs and policies, the Company’s Energy Trading segment has compensation programs and policies that are structured differently from those in other units within the Company. These compensation programs and policies are designed to discourage excessive risk taking by the Energy Trading employees and are subject to specific written policies and procedures administered by members of the Company’s senior management. The Company has determined that the Energy Trading compensation programs and policies do not create risks that are reasonably likely to have a material adverse effect on the Company.
20 DTE ENERGY 2021 PROXY STATEMENT


Board of Directors Compensation

Elements of Director Compensation
Employee directors receive no payment for service as directors. The goal of our compensation policies for non-employee directors is to tie their compensation to your interests as shareholders. Accordingly, approximately 50% of a director’s annual compensation is in the form of equity-based compensation, including phantom shares of our common stock. Generally, the compensation program for non-employee directors is reviewed on an annual basis by the Corporate Governance Committee and the Board. This review includes a review of a comparative peer group of companies that is identical to the peer group used to review executive compensation (See “Executive Compensation—Compensation Discussion and Analysis” beginning on page 36. Based on its December 2020 review, the Board made no modifications to the existing compensation program.
Cash Compensation 
Cash retainer $120,000 annually
Lead Independent Director retainer $30,000 annually
Committee chair retainer $20,000 annually for Audit, Nuclear Review, and Organization and Compensation Committee Chairs; $15,000 annually for Corporate Governance, Finance, and Public Policy and Responsibility Committee Chairs
New Member Orientation/Mentor Program $1,250 and $750 quarterly for the New Member and Mentor, respectively, for the duration of the orientation
Equity Compensation 
Upon first election to the Board 1,000 shares of restricted DTE Energy common stock, subject to a 3-year vesting period
Annual equity compensation A variable number of phantom shares of DTE Energy common stock valued at $145,000 annually, with the actual number of phantom shares to be granted each year determined based on the closing price of the Company’s common stock on the first business day of each calendar year(1)
(1)    Phantom shares of DTE Energy common stock are credited to each non-employee director’s account in January of each year. Phantom share accounts are also credited with dividend equivalents which are reinvested into additional phantom shares. For phantom shares granted after 2004, payment of the cash value is made three years after the date of grant unless otherwise deferred by voluntary election of the director. For phantom shares granted before 2005, payment of the cash value occurs only after the date a director terminates his or her service on the Board.

Payment of Non-Employee Director Fees and Expenses
Retainers for non-employee directors are either (i) payable in cash or (ii) at the election of the director, deferred into an account pursuant to the DTE Energy Company Plan for Deferring the Payment of Directors’ Fees. Non-employee directors may defer up to 100% of their annual retainer into an unfunded deferred compensation plan. Deferred fees may accrue for future payment, with interest accrued monthly at the 5-year U.S. Treasury Bond rate as of the last business day of each month or, at the election of the director, they may be invested in phantom shares of our common stock with all dividend equivalents reinvested.
In addition to the retainers, non-employee directors are reimbursed for their travel expenses incurred in attending Board and committee meetings, along with fees and expenses incurred when attending director education seminars or special meetings requested by management. Non-employee directors of the Company, along with full-time active employees and retirees, are also eligible to participate in the DTE Energy matching gift program, whereby the DTE Energy Foundation matches certain charitable contributions.
Director Life Insurance
The Company provides each non-employee director with group term life insurance in the amount of $20,000 and travel accident insurance in the amount of $100,000.


DTE ENERGY 2021 PROXY STATEMENT 21


Director Stock Ownership
We have established stock ownership guidelines for non-employee directors to more closely tie their interests to those of shareholders. Under these guidelines, the Board requires that each director own shares of the Company’s common stock beginning no later than 30 days after election to the Board. In addition, directors are required to own, within five years after initial election to the Board, shares of Company stock having a value equal to two times the sum of a director’s annual cash retainer plus the value of a director’s annual phantom stock compensation. Based on the 2021 director compensation program, a director with five years of service will be required to hold a minimum of $530,000 in stock under these guidelines. This ownership requirement is greater than four times the amount of a director’s cash retainer under the 2020 compensation program. Common stock, time-based restricted stock and phantom shares held by a director are counted toward fulfillment of this ownership requirement. As of December 31, 2020, all directors met the initial common stock ownership requirement and all those directors who have served as a director for at least five years after their initial election fulfilled the five-year requirement.
22 DTE ENERGY 2021 PROXY STATEMENT


2020 Director Compensation Table
The following table details the compensation earned in 2020 by each of the non-employee directors:
NameFees Earned or Paid in Cash ($)(1)Stock Awards ($)(2)All Other Compensation ($)(3)Total ($)
 David A. Brandon140,000 145,000 5,305 290,305 
 W. Frank Fountain, Jr. (retired)47,473 145,000 173 192,646 
 Charles G. McClure, Jr.135,000 145,000 5,305 285,305 
 Gail J. McGovern120,000 145,000 6,305 271,305 
 Mark A. Murray140,000 145,000 6,305 291,305 
 Ruth G. Shaw 150,750 145,000 5,494 301,244 
 Robert C. Skaggs, Jr.120,000 145,000 5,305 270,305 
 David A. Thomas129,725 145,000 158 274,883 
 Gary Torgow125,000 145,000 158 270,158 
 James H. Vandenberghe138,000 145,000 5,494 288,494 
 Valerie M. Williams141,250 145,000 158 286,408 

(1)    The following table provides a detailed breakdown of the fees earned or paid in cash:
    
 Fees Earned or Paid in Cash
NameBoard     
Retainer ($)     
Lead Independent Director/Committee Chair Retainers ($)New Member Orientation/Mentor Program Fees ($)Total ($)
 David A. Brandon120,000 20,000 — 140,000 
 W. Frank Fountain, Jr. (retired)42,198 5,275 — 47,473 
 Charles G. McClure, Jr. 120,000 15,000 — 135,000 
 Gail J. McGovern 120,000 — — 120,000 
 Mark A. Murray 120,000 20,000 — 140,000 
 Ruth G. Shaw 120,000 30,000 750 150,750 
 Robert C. Skaggs, Jr.120,000 — — 120,000 
 David A. Thomas 120,000 9,725 — 129,725 
 Gary Torgow120,000 — 5,000 125,000 
 James H. Vandenberghe 120,000 15,000 3,000 138,000 
 Valerie M. Williams120,000 20,000 1,250 141,250 

Messrs. Brandon, Torgow, and Vandenberghe elected to defer 100% of the fees detailed above into the DTE Energy Company Plan for Deferring the Payment of Directors’ Fees.

(2)    These amounts represent the dollar amounts of compensation cost for 2020 in accordance with ASC Topic 718 and, as such, include costs recognized in the financial statements with respect to phantom shares and shares of restricted stock granted. Because the phantom shares are 100% vested (with a mandatory three-year deferral) on the grant date, the ASC Topic 718 expense equals the grant date fair value as of January 2, 2020. The grant date fair value of $128.70 was the closing price of the Company stock on January 2, 2020. For all of the non-employee directors, this amount is $145,000 in phantom shares of DTE Energy stock granted on January 2, 2020, subject to a three-year payment deferral. Based on the grant date fair value of $128.70, this equated to a grant of 1,125 phantom shares.


DTE ENERGY 2021 PROXY STATEMENT 23


    Outstanding equity awards as of December 31, 2020 are as follows: 
    
NamePhantom Shares in Equity PlanPhantom Shares in Deferred Fee PlanRestricted Stock
David A. Brandon3,746 7,588 — 
W. Frank Fountain, Jr. (retired)18,286 14,385 — 
Charles G. McClure, Jr.3,746 650 — 
Gail J. McGovern35,670 — — 
Mark A. Murray3,746 650 — 
Ruth G. Shaw3,746 — — 
Robert C. Skaggs, Jr.3,746 — — 
David A. Thomas3,746 — — 
Gary Torgow1,155 834 1,000 
James H. Vandenberghe3,746 8,279 — 
Valerie M. Williams2,432 — 1,000 

(3)    This amount is the total of the premiums paid for the group-term life insurance provided to the non-employee directors by the Company and all contributions made by the DTE Energy Foundation under the Company matching program.


Information on Company Executive Officers
Under our Bylaws, the officers of DTE Energy are elected annually by the Board of Directors, each to serve until his/her successor is elected and qualified, or until his/her resignation or removal. The current executive officers of the Company elected by the Board are as follows:
NameAge(1)Present PositionPresent
Position
Held Since
Gerard M. Anderson62Executive Chairman7/1/2019(2)
JoAnn Chavez56Senior Vice President and Chief Legal Officer10/28/2019(2)
Trevor F. Lauer56President and Chief Operating Officer, DTE Electric Company4/4/2016(2)
David E. Meador64Vice Chairman and Chief Administrative Officer1/1/2014
Lisa A. Muschong51Vice President, Corporate Secretary and Chief of Staff11/2/2015
Gerardo Norcia58President and Chief Executive Officer7/1/2019(2)
Matthew Paul51President and Chief Operating Officer, DTE Gas Company4/1/2019(2)
Mark C. Rolling53Vice President, Controller and Chief Accounting Officer3/4/2019(2)
David Ruud54Senior Vice President and Chief Financial Officer5/4/2020(2)
David Slater55President and Chief Operating Officer, DTE Gas Storage and Pipelines10/2/2014
Mark W. Stiers58President and Chief Operating Officer, DTE Power & Industrial and Energy Trading4/1/2019(2)
(1)As of March 25, 2021.
(2)These executive officers have held various other positions at DTE Energy for five or more years.
24 DTE ENERGY 2021 PROXY STATEMENT


Compensation Committee Interlocks and Insider Participation
During 2020, the Organization and Compensation Committee consisted of Dr. Shaw, Messrs. Brandon, and Skaggs and Ms. McGovern. No member of the Organization and Compensation Committee serves as an officer or employee of the Company or any of its subsidiaries nor has any member of the Organization and Compensation Committee formerly served as an officer of the Company or any of its subsidiaries. During 2020, none of the executive officers of the Company served on the board of directors or on the compensation committee of any other entity, any of whose executive officers served either on the Board or on the Organization and Compensation Committee of the Company.

Indemnification and Liability
Pursuant to Article VI of our Articles of Incorporation, to the fullest extent permitted by law, no director of the Company shall be personally liable to the Company or its shareholders for any acts or omissions in the performance of his/her duties.
Article VII of our Articles of Incorporation provides that each person who is or was or had agreed to become a director or officer, or each person who is or was serving or who had agreed to serve at the request of the Board as an employee or agent of the Company, or as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise (including heirs, executors, administrators or estate of such person), shall be indemnified by the Company to the fullest extent permitted by law. We have entered into indemnification agreements with each of our directors and executive officers. These agreements require the Company to indemnify such individuals for certain liabilities to which they may become subject as a result of their affiliation with the Company.
The Company, the directors and officers in their capacities as such are insured against liability for alleged wrongful acts (to the extent defined) under fifteen insurance policies providing aggregate coverage in the amount of $255 million.



DTE ENERGY 2021 PROXY STATEMENT 25


Security Ownership of Directors and Officers

The following table sets forth information as of December 31, 2020, with respect to beneficial ownership of common stock, phantom stock, performance shares and options exercisable within 60 days for (i) each of our directors and nominees for director, (ii) our President and Chief Executive Officer, Senior Vice President and Chief Financial Officer, Senior Vice President (who served as Senior Vice President and Chief Financial Officer until May 4, 2020), and the three other highest paid executive officers (together, the “Named Executive Officers”), and (iii) all executive officers and directors as a group. Executive officers for this purpose are those individuals defined as executive officers under Rule 16a-1(f) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). Unless otherwise indicated, each of the named individuals has sole voting and/or investment power over the shares identified. To our knowledge, no member of our management team or director was a beneficial owner of one percent or more of the outstanding shares of common stock as of December 31, 2020.
Amount and Nature of Beneficial Ownership as of December 31, 2020
Name of Beneficial OwnersCommon Stock(1) Phantom Stock(2)Other Shares That May Be Acquired(3)
Gerard M. Anderson588,176 14,317 97,779 
David A. Brandon1,000 11,334 — 
Charles G. McClure, Jr.1,000 4,396 — 
Gail J. McGovern— 35,670 — 
Mark A. Murray1,000 4,396 — 
Gerardo Norcia183,381 1,421 81,180 
Ruth G. Shaw5,500 3,746 — 
Robert C. Skaggs, Jr.1,009 3,746 — 
David A. Thomas1,673 3,746 — 
Gary Torgow2,537 1,990 — 
James H. Vandenberghe2,000 12,025 — 
Valerie M. Williams1,000 2,432 — 
Trevor F. Lauer30,440 1,389 23,663 
David E. Meador176,488 — 34,933 
Peter B. Oleksiak50,884 — 31,222 
David Ruud37,888 153 11,558 
Directors and Executive Officers as a group — 221,164,791 102,655 329,515 
(1)Includes directly held common stock, restricted stock and shares held pursuant to the DTE Energy Company Savings and Stock Ownership Plan (tax-qualified 401(k) plan).
(2)Shares of phantom stock are acquired as follows: (a) by non-employee directors (i) as compensation under the DTE Energy Company Deferred Stock Compensation Plan for Non-Employee Directors and (ii) through participation in the DTE Energy Company Plan for Deferring the Payment of Directors’ Fees and (b) by executive officers pursuant to the (i) DTE Energy Company Supplemental Savings Plan and (ii) DTE Energy Company Executive Supplemental Retirement Plan. Shares of phantom stock may be paid out in either cash or stock.
(3)Represents performance shares under the Long-Term Incentive Plan (as described beginning on page 47) that entitle the executive officers to receive shares or cash equivalents (or a combination thereof) in the future if certain performance measures are met. The number of performance shares reflected in the table assumes that target levels of performance are achieved and includes an increase from the original grant amount, assuming full dividend reinvestment at the fair market value on each dividend payment date. Performance shares are not currently outstanding shares of our common stock and are subject to forfeiture if the performance measures are not achieved over a designated period of time. Executive officers do not have voting or investment power over the performance shares until performance measures are achieved. See the discussion in “Long-Term Incentives - Performance Shares Granted in 2020” beginning on page 47.
26 DTE ENERGY 2021 PROXY STATEMENT


Prohibition on Pledging and Hedging Company Securities
The Company maintains policies which expressly prohibit hedging Company securities by all employees, executive officers and directors of the Company and its subsidiaries. For purposes of these policies, hedging includes purchases and sales of derivatives or any monetization transaction involving DTE securities that has the effect of limiting or eliminating the full risks of ownership of DTE securities. Our directors and officers are also prohibited from pledging their shares of Company stock as collateral for any loan or indebtedness. This prohibition includes, but is not limited to, holding such shares in a margin account.
Security Ownership of Certain Beneficial Owners
The following table sets forth information regarding the only persons or groups known to the Company to be beneficial owners of more than 5% of our outstanding common stock.
Title of ClassName and Address of Beneficial OwnerAmount and Nature of Beneficial OwnershipPercent    
of Class    
Common StockThe Vanguard Group, Inc.
100 Vanguard Blvd.
Malvern, Pennsylvania 19355
21,594,379 (1)11.2 %
Common StockCapital World Investors
333 South Hope Street, 55th Fl
Los Angeles, California 90071
21,147,082 (2)11.0 %
Common StockBlackRock, Inc.
55 East 52nd Street
New York, New York 10055
14,644,427.00(3)7.5 %
(1)Based on information contained in Schedule 13G/A filed on February 10, 2021. The Vanguard Group, Inc. has shared voting power with respect to 313,941 shares, sole dispositive power with respect to 20,751,209 shares, shared dispositive power with respect to 843,170 shares and is deemed to beneficially own 21,594,379 shares.
(2)Based on information contained in Schedule 13G filed on February 16, 2021. Capital World Investors has sole dispositive power with respect to 21,147,082 shares, sole voting power with respect to 21,147,082 shares, and is deemed to beneficially own 21,147,082 shares.
(3)Based on information contained in Schedule 13G/A filed on February 5, 2021. BlackRock Inc. has sole dispositive power with respect to 14,644,427 shares, sole voting power with respect to 13,083,631 shares, and is deemed to beneficially own 14,644,427 shares.
Certain Relationships and Related Transactions
Related-person transactions have the potential to create actual or perceived conflicts of interest. The Company has policies in place to address related-party transactions. In addition, our Corporate Governance Committee and Audit Committee review potential dealings or transactions with related parties. In conducting such reviews, the committees consider various factors they deem appropriate, which may include (i) the identity of the related party and his or her relationship to the Company, (ii) the nature and size of the transaction, including whether it involved the provision of goods or services to the Company that are unavailable from unrelated third parties and whether the transaction is on terms that are comparable to the terms available from unrelated third parties, (iii) the nature and size of the related party’s interest in the transaction, (iv) the benefits to the Company of the transaction and (v) whether the transaction could involve an apparent or actual conflict of interest with the Company.
In general, employees and directors may not be involved in a business transaction where there is a conflict of interest with the Company. The DTE Energy Way requires non-officer employees to report conflicts of interest or potential conflicts of interest to their respective superiors; the Officer Code of Conduct and Ethics requires officers to report conflicts of interest or potential conflicts of interest to the Company’s General Counsel or to the Company’s Board of Directors; and the Board of Directors Code of Business Conduct and Ethics requires directors to disclose conflicts of interest or potential conflicts of interest to the Company’s Corporate Governance Committee or the Chairman of the Board. For directors and officers, any waivers of the Company’s conflict of interest policy must be approved by the Board or a Board committee, as required under the Officer Code of Conduct and Ethics or Board of Directors Code of Business Conduct and Ethics, disclosed to shareholders and posted to our website at dteenergy.com/ethics.


DTE ENERGY 2021 PROXY STATEMENT 27


Proposal No. 2 — Ratification of Appointment of Independent Registered Public Accounting Firm
Subject to ratification by the shareholders, the Audit Committee has appointed PricewaterhouseCoopers LLP (“PwC”) as our independent registered public accounting firm to audit our consolidated financial statements for the fiscal year ending December 31, 2021 and to perform other audit-related services. Following the Audit Committee’s appointment, the Board voted unanimously to recommend that our shareholders vote to ratify the Audit Committee’s selection of PwC as our independent auditors for 2021.
The reports of PwC on the consolidated financial statements of DTE Energy for the year ended December 31, 2020 and for the year ended December 31, 2019 did not contain adverse opinions or a disclaimer of opinions and were not qualified or modified as to uncertainty, audit scope or accounting principles.
During the Company’s two most recent fiscal years ended December 31, 2020 and 2019 and from January 1, 2021 through February 19, 2021, there were no disagreements with PwC on any matter of accounting principles or practices, financial statement disclosure or auditing scope or procedure, which disagreements, if not resolved to PwC’s satisfaction, would have caused PwC to make reference to the subject matter of such disagreements in connection with its reports on the Company’s consolidated financial statements for such years.
During the Company’s two most recent fiscal years ended December 31, 2020 and 2019 and from January 1, 2021 through February 19, 2021, there were no “reportable events” as defined under Item 304(a)(1)(v) of Regulation S-K.
Representatives of PwC will be present at the annual meeting and will be afforded an opportunity to make a statement, if they desire, and to respond to appropriate questions from shareholders.
Fees to the Independent Registered Public Accounting Firm
The following table presents fees for professional services rendered by PwC for the audit of the Company’s consolidated annual financial statements for the years ended December 31, 2020 and December 31, 2019, and fees billed for other services rendered by PwC during those periods.
20202019
Audit fees(1)$7,172,201 $7,027,031 
Audit-related fees(2)1,192,913 220,735 
Tax fees(3)241,787 294,747 
All other fees(4)405,074 588,389 
Total$9,011,975 $8,130,902 
(1)Represents the aggregate fees for audits of the Company's consolidated annual financial statements included in the Company's Form 10-K, review and audit of the Company’s internal control over financial reporting, the review of consolidated financial statements included in the Company’s Form 10-Q filings, and audit services provided in connection with certain regulatory filings, debt issuances, and other engagements. Audit fees are presented on an Audit Year basis in accordance with SEC guidelines and include an estimate of fees incurred for the most recent Audit Year.
(2)Represents the aggregate fees billed for audit-related services and various attest services.
(3)Represents fees billed for tax services, including tax reviews and planning.
(4)Represents consulting services for the purpose of providing advice and recommendations.

28 DTE ENERGY 2021 PROXY STATEMENT


Policy on Audit Committee Pre-Approval of Audit and Permissible Non-Audit Services of Independent Registered Public Accounting Firm
Consistent with SEC policies regarding the independence of the registered public accounting firm, the Audit Committee is responsible for appointing, approving professional service fees of, and overseeing the work of the independent registered public accounting firm. The Audit Committee has established a policy regarding pre-approval of all audit and permissible non-audit services provided by the independent registered public accounting firm.
Prior to engaging the independent registered public accounting firm to perform specific services, the Audit Committee pre-approves these services by category of service. The Audit Committee may delegate to the Chair of the Audit Committee, or to one or more other designated members of the Audit Committee, the authority to grant pre-approvals of all permitted services or classes of these permitted services to be provided by the independent registered public accounting firm. The decisions of the designated member to pre-approve a permitted service are reported to the Audit Committee at each scheduled meeting. At least quarterly, the Audit Committee reviews:
 
A report summarizing the services, or groupings of related services, including fees, provided by the independent registered public accounting firm.
A listing of new services requiring pre-approval, if any.
As appropriate, an updated projection for the current fiscal year, presented in a manner consistent with the proxy disclosure requirements, of the estimated annual fees to be paid to the independent registered public accounting firm.
All audit, audit-related, tax and other services performed by PwC were pre-approved by the Audit Committee in accordance with the regulations of the SEC. The Audit Committee considered and determined that the provision of the non-audit services by PwC during 2020 was compatible with maintaining independence of the registered public accounting firm.
Report of the Audit Committee
The purpose of the Audit Committee is to assist the Board’s oversight of the integrity of the Company’s consolidated financial statements, the Company’s compliance with legal and regulatory requirements, the Company’s independent registered public accounting firm’s qualifications and independence and the performance of the Company’s internal audit function. All members of the Audit Committee meet the criteria for independence as defined in our categorical standards and the audit committee independence requirements under the SEC rules. The Audit Committee Charter also complies with requirements of the NYSE.
Management is responsible for the financial reporting process, including the system of internal controls, and for the preparation of consolidated financial statements in accordance with accounting principles generally accepted in the United States of America (“GAAP”). Management is also responsible for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting. The independent registered public accounting firm is responsible for auditing these consolidated financial statements and expressing an opinion as to their conformity with GAAP. The independent registered public accounting firm is also responsible for expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. The Audit Committee’s responsibility is to monitor and review these processes, acting in an oversight capacity, and the Audit Committee does not certify the consolidated financial statements or internal control over financial reporting or guarantee the independent registered public accounting firm’s reports. The Audit Committee relies, without independent verification, on the information provided to it including representations made by management and the reports of the independent registered public accounting firm.
The Audit Committee discussed with PwC the matters required to be discussed by audit standards, SEC regulations and NYSE requirements. Disclosures were received from PwC regarding its independence as required by applicable requirements of the Public Company Accounting Oversight Board and discussed with them. The Audit Committee has considered whether the services provided by PwC other than those services relating to audit services are compatible with maintaining PwC’s independence. The Audit Committee has concluded that such services have not impaired PwC’s independence. The Audit Committee reviewed and discussed the audited consolidated financial statements for the year ended December 31, 2020 with management and PwC. Based on the review and discussions noted above, the Audit


DTE ENERGY 2021 PROXY STATEMENT 29


Committee recommended to the Board that the audited consolidated financial statements be included in the Company’s Annual Report on Form 10-K filed with the SEC for the fiscal year ended December 31, 2020. The Audit Committee reviewed and discussed Management’s Report on Internal Control over Financial Reporting as of December 31, 2020 with management and PwC. Based on the review and discussions noted above, the Audit Committee recommended to the Board that Management’s Report on Internal Control over Financial Reporting as of December 31, 2020 be included in the Company’s Annual Report on Form 10-K filed with the SEC for the fiscal year ended December 31, 2020.
Audit Committee
Valerie M. Williams, Chair
Charles G. McClure, Jr.
David A. Thomas
James H. Vandenberghe
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR THE PROPOSAL TO RATIFY THE APPOINTMENT OF THE INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM.

Proposal No. 3 — Advisory Proposal — Nonbinding Vote to Approve Executive Compensation
The Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 (the “Dodd-Frank Act”) requires the Company to provide shareholders with an opportunity to vote to approve, on an advisory basis, the compensation of our Named Executive Officers as described in the “Compensation Discussion and Analysis” (“CD&A”) section of this proxy statement and in the tabular and narrative disclosure regarding Named Executive Officer compensation, all contained under the heading “Executive Compensation” in this proxy statement.
The Company’s executive compensation program is designed to include elements of cash and equity-based compensation to motivate and reward executives who achieve short-term and long-term corporate and financial objectives leading to the success of the Company. We emphasize competitive, performance-based compensation to attract and retain talented executives and align the interests of our executives with those of our shareholders. At each of the 2020 and 2019 annual meetings, 96.3% and 94.8%, respectively, of voting shareholders approved the compensation of the Named Executive Officers.
Shareholders have in the past approved the incentive plans that we use to motivate and reward our executives, including the Annual Incentive Plan and the Long-Term Incentive Plan. In addition, the Company has enhanced our disclosures related to executive compensation to provide more detail to our shareholders about our compensation programs, including expanded disclosures relating to the plans in this proxy statement.
Our executive compensation programs have been important in driving the Company’s success in achieving its corporate and financial objectives by tying executive compensation to achieving very specific goals in each of our key priority areas. Progress against these objectives is necessary for the Company to achieve its ultimate goal of becoming the best-operated energy company in North America and a force for growth and prosperity in the communities where we live and serve. We explain each of our performance targets and measures in detail in our CD&A, but a few examples of Company success in areas related to our targets and measures include the following:

Achieved 8.3% compound operating earnings per share growth during the five years ending 2020 (see discussion of operating earnings on page 2).
Increased our dividend payment to $4.05 per share in 2020, representing a 7.8% increase over the dividend in 2019.
Provided our shareholders with a five-year total shareholder return of 179% (indexed with 2015 as the base year = 100%).
Delivered cash from operations of $3.7 billion in 2020.

The Organization and Compensation Committee (“O&C Committee”) employs the highest standards of corporate governance when implementing and reviewing our executive compensation programs. The O&C Committee ensures
30 DTE ENERGY 2021 PROXY STATEMENT


independence of committee members and compensation consultants, avoids conflicts of interest and has enhanced shareholder disclosure in accordance with SEC and NYSE requirements.
For these reasons, the Board recommends that shareholders vote in favor of the following resolution:
“RESOLVED, that the shareholders approve, on an advisory basis, the overall executive compensation paid to the Named Executive Officers of the Company, as described in the Compensation Discussion and Analysis and the tabular and narrative disclosure regarding Named Executive Officer compensation contained in this proxy statement.”
Because this vote is advisory, it will not be binding upon the Company or the Board. The O&C Committee will take into account the outcome of the vote when considering future executive compensation arrangements.

THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR THE PROPOSAL
TO APPROVE EXECUTIVE COMPENSATION.

Proposal No. 4 — Management Proposal — Approval of an Amendment and Restatement of the DTE Energy Company Long-Term Incentive Plan
The Board is seeking shareholder approval of the amendment and restatement of the DTE Energy Company Long-Term Incentive Plan ("LTIP"). In 2006, the Board adopted the LTIP and our shareholders approved the LTIP on April 27, 2006. At the 2010, 2012, 2014 and 2018 shareholder meetings, shareholders overwhelmingly approved amendments to the LTIP. At its January 2021 meeting, the Board approved a restatement of the LTIP that includes several amendments to the LTIP, most of which do not require shareholder approval.

The amendments included in the LTIP restatement which the Board asks shareholders to approve will (a) increase the aggregate number of shares of common stock that may be issued or acquired and delivered under the LTIP pursuant to the exercise of options, the grant of stock awards and the settlement of performance shares and performance units by 3,000,000 to 19,500,000 and (b) extend the life of the plan for a term of ten years from the January 2021 date of approval of the restatement by the Board. It is anticipated the share increase will ensure the plan has sufficient shares authorized to satisfy the needs of the plan through the end of 2025.

The Board proposes that shareholders approve the amendments to enable the Company to continue to offer the incentives necessary to attract and retain the employees needed to support the Company’s future growth and success and align the long-term interests of employees with those of the shareholders. Without the additional shares, the Company would be unable to attract and retain the most qualified employees.

The amendments included in the restatement approved by the Board at the January 2021 meeting which do not require shareholder approval remove several obsolete references to IRC Section 162(m).

More information regarding our compensation philosophy can be found beginning on page 36 of this proxy statement, and our grant practices are described under "Long-Term Incentives" beginning on page 47. The amendment and restatement of the LTIP will become effective upon approval by the shareholders at our annual meeting on May 20, 2021. The vote required to approve this proposal is described under the heading "How does the voting work?" on page 73.

The following summarizes the material provisions of the LTIP, assuming the amendment and restatement described above is approved by the shareholders by an affirmative vote of a majority of the votes cast. The summary is qualified in its entirety by reference to the full conformed text of the amended and restated LTIP, which is attached as Exhibit A to this Proxy Statement.

Material Terms of the Amendment to the LTIP:

If this proposal is passed, (a) Section 5.02(a) of the LTIP will be amended to provide that the maximum aggregate number of shares of DTE Energy Company common stock that may be issued or acquired and delivered under the LTIP pursuant to


DTE ENERGY 2021 PROXY STATEMENT 31


the exercise of options, the grant of stock awards and the settlement of performance shares and performance units is increased from 16,500,000 to 19,500,000, subject to adjustment in the event of certain changes in capitalization or other corporate transactions and (b) Article XV, Duration of the Plan, will be amended to provide that grants may not be made under the LTIP more than ten years after the Board's approval of the amended and restated LTIP on January 28, 2021.

Material Terms of the LTIP (as amended):

Participants: Any employee of DTE Energy or an entity in which DTE Energy has a direct or indirect ownership or other equity interest ("Subsidiary") and any member of the Board, whether or not employed by DTE Energy or a Subsidiary, is eligible to participate if the plan administrator determines that the employee or director has contributed significantly, or may be expected to contribute significantly, to the profits or growth of DTE Energy or a Subsidiary. An eligible employee or director becomes a participant if he or she is selected to receive a LTIP award by the plan administrator. As of March 25, 2021, we expect that approximately 10 non-employee directors, 11 executive officers, and 10,600 employees of the Company and its subsidiaries will be eligible to receive awards under the LTIP.

Plan Administration: The Board administers the LTIP with respect to awards made to members of the Board who are not employees of DTE Energy or a Subsidiary. The Organization and Compensation Committee administers the LTIP with respect to awards made to employees of DTE Energy or a Subsidiary. The Committee may delegate to the CEO, and in certain instances, to the President, all or part of its authority and duties as to awards made to individuals not subject to Section 16 of the Exchange Act. References in this summary to the "plan administrator" include references to the Organization and Compensation Committee, any other committee appointed in its place, the CEO or President of DTE Energy or the Board, as the context requires.

The basis for participation in the LTIP is the plan administrator’s decision, in its sole discretion, that an award to an eligible participant will further the LTIP’s purposes. In exercising its discretion, the plan administrator will consider the recommendations of management and the purpose of the LTIP, which is to provide stock-based compensation to employees and non-employee directors to promote close alignment among the interests of employees, directors and shareholders. Under the LTIP, in most cases, awards have been structured as performance-based awards that will vest over time but only upon achievement of performance criteria, provided herein. In addition, the plan administrator may also make awards which have been structured to vest solely over time in order to help retain the recipients of LTIP awards.

The plan administrator has the authority to determine the persons to whom awards will be made; to select the type, size and timing of each award; to set the terms and provisions of each award, consistent with the provisions of the LTIP; and to establish rules and policies for the plan. The plan administrator may amend the provisions of existing award agreements when it deems appropriate. The plan administrator may not, however, grant to any participant in a single calendar year:(1) options for more than 500,000 shares of common stock; (2) stock awards for more than 150,000 shares of common stock; (3) performance share awards for more than 300,000 shares of common stock (based on the maximum payout under the award); or (4) more than 1,000,000 performance units, which have a face amount of $1.00 each.

Aggregate Number of Plan Shares: The maximum aggregate number of shares of DTE Energy common stock that may be issued or acquired and delivered under the LTIP pursuant to the exercise of options, the grant of stock awards and the settlement of performance shares and performance units is 19,500,000, subject to adjustment in the event of certain changes in capitalization or other corporate transactions. Of this total, the aggregate limit of awards to non-employee directors is 100,000 shares. It is anticipated that the plan would have sufficient shares to satisfy the needs of the plan through the end of 2025. If (i) an option is terminated, in whole or part, for any reason other than its exercise for shares of common stock; or (ii) a stock award is forfeited, in whole or in part; or (iii) an award of performance shares or performance units is terminated, in whole or in part for any reason other than its settlement in shares of common stock or cash, the number of shares subject to the terminated or forfeited portion of the award may be reallocated to other options, performance shares, performance units and stock awards, subject to the limits described above. Reallocation of shares shall not be permitted for shares repurchased by stock option proceeds, shares tendered in payment of an exercise price or shares tendered or withheld by the Company in satisfaction of tax obligations. As of December 31, 2020, there were approximately 1,456,296 shares subject to outstanding awards granted under the plan, and approximately 1,393,916 shares remained available for issuance under the LTIP (not including the share increase reflected in the amended and restated version of the LTIP). The closing price of a share of the Company's common stock on March 1, 2021 was $119.10.

32 DTE ENERGY 2021 PROXY STATEMENT


Stock Option Awards: Each stock option granted pursuant to the LTIP is evidenced by a written stock option agreement between the Company and the optionee. The option price will be fixed by the plan administrator but cannot be less than the Fair Market Value of DTE Energy common stock on the date of grant of the option. The option price may be paid in cash, cash equivalent acceptable to the plan administrator, or with unrestricted shares of DTE Energy common stock. The maximum period in which an option may be exercised will be fixed by the plan administrator on the date of grant, but cannot exceed ten years from the date of grant. The plan administrator also establishes, on the date of grant, the terms on which the option may be exercised and the consequences of termination of employment. Options granted under the LTIP may be either non-qualified options or incentive stock options. The plan administrator may not permit the exercise of any option earlier than one year after the date of the grant. Generally, one-third of the options covered by a single grant are exercisable one, two and three years after the date of the grant.

The federal income tax consequences of the two types of options differ, as described below. No federal income tax is recognized by a participant at the time an option is granted. If the option is an incentive stock option, no income will be recognized upon the participant’s exercise of the option. Income is recognized by a participant when he or she disposes of shares acquired under an incentive stock option. The exercise of a non-qualified stock option is a taxable event that requires the participant to recognize, as ordinary income, the difference between the shares’ fair market value and the option price. Except to the extent limited by Section 162(m) (see discussion on page 51), the employer (either DTE Energy or a Subsidiary) will be entitled to claim a federal income tax deduction on account of the exercise of a non-qualified option equal to the amount of ordinary income recognized by the participant. The employer will not be entitled to a federal income tax deduction on account of the grant or exercise of an incentive stock option, but may claim a federal income tax deduction on account of certain dispositions of DTE Energy common stock acquired on exercise of an incentive stock option. The LTIP prohibits, without prior shareholder approval, (1) reducing the option price of an outstanding option, (2) canceling any options and replacing them with new awards having a lower option price (where the economic effect would be the same as reducing the option price) and (3) at any time when the price of a previously granted option is above the Fair Market Value of one share of DTE Energy common stock, the making of any offer by the plan administrator to purchase the previously granted option for a cash payment in substitution for or upon the cancellation of the option.

Stock Awards: Awards of Company stock may be granted, and may be forfeitable or subject to certain restrictions on transfer, or both, unless conditions prescribed by the plan administrator on the date of grant are satisfied. The conditions may include a requirement that the participant continue employment with DTE Energy or that stated performance objectives be achieved. Rights to stock awards cannot become non-forfeitable or unrestricted earlier than three years after the date of the award, except in limited special circumstances, including awards to new hires and participants expected to retire within three years, when stock awards can provide that the award will become non-forfeitable or unrestricted earlier than three years after the date of the award but in no event earlier than one year after the date of the award. The participant generally is entitled to vote and receive dividend equivalents on the stock award prior to the time the shares become non-forfeitable or transferable. A participant recognizes ordinary income on the first day that the shares subject to the stock award are either transferable or not subject to a substantial risk of forfeiture. The amount of income recognized equals the fair market value of the shares on that date. Except to the extent limited by Section 162(m) (see discussion on page 51), the participant’s employer is entitled to a Federal income tax deduction equal to the ordinary income recognized by the participant.

Performance Share Awards: Performance share awards entitle the participant to receive a specified number of shares of DTE Energy common stock. Once earned, a performance share award may be settled in shares of DTE Energy common stock, cash or a combination of the two, in the plan administrator's discretion. The plan administrator may prescribe that performance shares will be earned only on satisfaction of performance objectives during a performance measurement period of at least one year or upon satisfaction of other requirements. The plan administrator may also specify the consequences of termination of employment. Rights in performance shares may not become non-forfeitable earlier than one year after the date of the award. Settlement will occur at the time specified by the plan administrator. A participant recognizes ordinary income on the settlement of a performance share award equal to any cash that is paid and the fair market value of common stock (on the date the shares are first transferable or not subject to a substantial risk of forfeiture) that is received in settlement of the award. Except to the extent limited by Section 162(m) (see discussion on page 51), the participant’s employer is entitled to a Federal income tax deduction equal to the amount of ordinary income recognized by the participant. All agreements awarding performance shares provide that dividend equivalents with respect to the award will not be paid before the performance shares are earned and vested. During the period beginning on the date the performance shares are awarded and ending on the certification date of the performance objectives, the number of performance shares awarded will be increased, assuming full dividend reinvestment at the Fair Market Value


DTE ENERGY 2021 PROXY STATEMENT 33


(as defined in the LTIP) on the dividend payment date. The cumulative number of performance shares will be adjusted to determine the final payment based on the performance objectives as certified by the O&C Committee. The final adjusted number of performance shares will be paid as provided in the LTIP.

Performance Unit Awards: A performance unit award entitles the participant to receive a payment equal to $1.00 per performance unit if certain standards are met. The plan administrator will prescribe the performance objectives and other requirements that must be satisfied before a performance unit is earned and specify the consequences of termination of employment. Performance units may not become non-forfeitable earlier than one year after the date of the award. The period in which performance is measured will be at least one year. To the extent that performance units are earned, the obligation may be settled in cash, DTE Energy common stock, or a combination of the two, in the plan administrator's discretion. A participant recognizes ordinary income on the settlement of a performance unit award equal to any cash that is paid and the fair market value of common stock (on the date the shares are first transferable or not subject to a substantial risk of forfeiture) that is received in settlement of the award. Except to the extent limited by Section 162(m) (see discussion on page 51), the participant’s employer is entitled to a Federal income tax deduction equal to the amount of ordinary income recognized by the participant.

Performance Objectives: Vesting, settlement or exercise of an award made under the LTIP may be conditioned upon the achievement of specified performance objectives by DTE Energy, a Subsidiary, or a division of DTE Energy or a Subsidiary. The performance objectives may be stated with respect to (i) shareholder value growth based on stock price and dividends, (ii) customer price, (iii) customer satisfaction, (iv) growth based on increasing sales or profitability of one or more business units, (v) performance against the companies in the Dow Jones Electric Utility Industry Group ("DJEUIG") index, the companies in the S&P 500 Electric Utility Industry index, a peer group or similar benchmark selected by the Organization and Compensation Committee, (vi) earnings per share growth, (vii) employee satisfaction, (viii) nuclear plant performance achievement, (ix) return on equity, (x) economic value added, (xi) cash flow, (xii) earnings growth, (xiii) diversity, (xiv) safety, (xv) production cost, or (xvi) such other measures as may be selected by the plan administrator. Each of the performance objectives described in the preceding sentence may be stated with respect to the performance of DTE Energy, a Subsidiary or a division of DTE Energy or a Subsidiary.

Amendments: The Board may amend the LTIP from time to time or terminate it at any time. However, no material amendment to the LTIP may become effective until shareholder approval is obtained. A material amendment to the LTIP is any amendment that would (a) materially increase the aggregate number of shares of common stock that may be issued or delivered under the Plan or that may be issued to a Participant; (b) permit the exercise of an option at an option price less than the Fair Market Value on the date of grant of the option or otherwise reduce the price at which an option is exercisable, either by amendment of an Agreement or substitution with a new award with a reduced price; (c) change the types of awards that may be granted under the LTIP; (d) expand the classes of persons eligible to receive awards or otherwise participate in the LTIP; or (e) require approval of the shareholders of the Company to comply with applicable law or the rules of the New York Stock Exchange.

Termination: No awards may be granted under the LTIP more than ten years after the Board's approval of the amended and restated LTIP on January 28, 2021. Awards granted before that date will remain valid in accordance with their terms.

Change in Control: In the event of a change in control, the surviving or acquiring entity may choose either to continue the LTIP and maintain all outstanding awards or to adopt a comparable equity compensation plan and grant new awards in substitution for outstanding awards under the LTIP. However, if the surviving or acquiring entity does not continue or substitute the outstanding awards, then (i) all options become fully exercisable, (ii) all stock awards become non-forfeitable and transferable, and (iii) all performance shares and performance units are earned, with the amount earned being the amount payable assuming attainment of the greater of target or actual performance levels through the date of the change in control. The accelerated exercisability, vesting or payment described in the preceding sentence may constitute a parachute payment, which may subject the affected participant to an excise tax imposed by IRC Section 4999. Consequently, the accelerated exercisability, vesting or payment is limited if, and to the extent that, the limitation will permit an affected participant to receive a greater net after-tax amount than he or she would receive absent the limitation. The limitation shall not apply to participants who are entitled to an indemnification of excise taxes by DTE Energy under change in control severance agreements or otherwise. Generally, a change in control occurs for purposes of the LTIP if DTE Energy or its assets are acquired by another company or DTE Energy merges with another company and less than 55% of the new or acquiring company’s combined voting stock is held by holders of voting stock of DTE Energy
34 DTE ENERGY 2021 PROXY STATEMENT


immediately prior to the transaction. Shareholder approval of a liquidation or dissolution is also considered a change in control.

New Plan Benefits: It is not possible to determine specific amounts and types of awards that may be awarded in the future under the LTIP because the grant and settlement of awards under the LITP are subject to the discretion of the plan administrator.

Updated Equity Compensation Plan Information: The table below provides updated information about our common stock subject to equity compensation plans as of March 1, 2021.
Number of Securities to be Issued Upon Exercise of Outstanding OptionsWeighted-Average Exercise Price of Outstanding OptionsNumber of Securities Remaining Available for Future Issuance Under Equity Compensation Plans
Plans approved by shareholders— — 716,622

THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR THE PROPOSAL TO APPROVE THE
AMENDMENT AND RESTATEMENT OF THE DTE ENERGY COMPANY LONG-TERM INCENTIVE PLAN.



DTE ENERGY 2021 PROXY STATEMENT 35


EXECUTIVE COMPENSATION
Compensation Discussion and Analysis
Executive Summary
The Company believes in executive compensation that is competitive with our peers, has a meaningful performance component and has equity-based elements to encourage executives to maintain an appropriate ownership interest in the Company. Our performance-based compensation programs result in a majority of the compensation of our Chief Executive Officer being linked to the achievement of a combination of short-term and long-term Company and personal goals and shareholder value creation.
The following elements comprise the total compensation awarded to our Named Executive Officers (“NEOs”):
Elements of CompensationHow this Element Serves the Company’s Objectives
Base Salary Provides a stable, fixed source of income that reflects an executive’s job responsibilities, experience, value to the Company and demonstrated performance.

We target median base salaries for our peer group, taking into account differences in company size within the peer group.
Annual Incentive Awards  Intended to compensate individuals yearly based on the achievement of specific near-term, annual goals, which are established at the beginning of each year and approved by the O&C Committee.

The Board and management have identified several priority areas that management and the Board discuss regularly when reviewing Company performance. Our performance measures for annual incentive awards are the measurements that the Board uses to track progress in these key priority areas. Achievement of these performance objectives is a critical measure of the Company’s progress towards its goal of becoming the best-operated energy company in North America and a force for growth and prosperity in the communities where we live and serve. 
Long-term Incentive Awards Used to align executive actions with long-term management and shareholder objectives, providing rewards consistent with the creation of shareholder value.

Our plan is designed to help retain executives over time and ensure they have a strong sense of ownership in the Company.

Pay for Performance Alignment
The Company’s compensation programs are designed to clearly align performance objectives for our Named Executive Officers with the interests of shareholders and with management’s system of priorities. (See image of system of priorities on page 1.) Our Company’s aspiration is to be the best-operated energy company in North America and a force for growth and prosperity in the communities where we live and serve. We follow a system of priorities to achieve this objective, and our performance measures are designed to help move our Company towards achieving these priorities. The following table demonstrates how our annual and long-term performance measures map to our system of priorities.
36 DTE ENERGY 2021 PROXY STATEMENT


Our System of PrioritiesRelated Annual or Long-Term Performance Metrics
Highly Engaged Employees
 
 DTE Energy Employee Engagement - Gallup
DTE Energy OSHA Recordable Incident Rate
DTE Energy OSHA Days Away, Restricted and Transfer Rate
Top-Decile Customer Satisfaction Customer Satisfaction Index
Customer Satisfaction Improvement Program Index
MPSC Customer Complaints
Distinctive Continuous Improvement Capability Customer Satisfaction Improvement Program Index
Utility Operating Excellence Index
Strong Political & Regulatory ContextCustomer Satisfaction Improvement Program Index
Utility Operating Excellence Index
MPSC Customer Complaints
Clear Growth & Value Creation Strategy DTE Energy Total Shareholder Return vs Peer Group
Superior & Sustainable Financial Performance DTE Energy Cash Flow
DTE Energy Operating Earnings Per Share
DTE Energy Ratio of Funds From Operations to Debt


What We Do and What We Don’t Do
Our compensation programs are competitive and well-governed. We adopt best practices that make sense for our company and industry and avoid pay practices that are inconsistent with our pay-for-performance structure.

What we do:
We use multiple performance measures in our short-term and long-term plans that link compensation to our corporate objectives to be the best operated energy company in North America and to maximize shareholder value
We make the majority of compensation for our Chief Executive Officer “at risk” to further tie compensation to performance and shareholder interests
Our O&C Committee is comprised of all independent directors and our compensation consultant is independent 
We adopted a clawback mechanism to allow the Company to recover incentive compensation in the event of a material financial restatement
We require executives and directors to meet robust stock ownership requirements 
We review and update our peer groups and benchmarking on a regular basis to make sure our compensation remains competitive and near the median of the peer group
We engage with shareholders to seek input about our compensation practices and policies

What we don’t do:
No single-trigger change-in-control payments
No excessive perquisites
No tax gross-ups on change-in-control agreements
No guaranteed bonuses
No pledging, hedging or short sales of Company securities for officers or directors
No stock option grants since 2010
No repricing of existing stock options
No “excessive” golden parachute payments in any of our change-in-control arrangements


DTE ENERGY 2021 PROXY STATEMENT 37


CEO Total Actual Compensation for 2020: Fixed vs. At-Risk
Our pay mix puts a high weight on performance-based compensation. This means that the majority of compensation is variable and will go up or down based on company performance. For 2020, 64% of our President and Chief Executive Officer’s compensation was performance-based or “at risk.”
chart-488342b186d44160aeb1a.jpg
Overview
Your understanding of our executive compensation program is important to us. The goal of this Compensation Discussion and Analysis is to explain:
 
Our compensation philosophy and objectives for executives of the Company, including our Named Executive Officers;
The roles of our O&C Committee and management in the executive compensation process;
The key components of the executive compensation program; and
The decisions we make in the compensation process that align with our philosophy and objectives.
Throughout this proxy statement, the term “Named Executive Officers” means: (1) the President and Chief Executive Officer, Gerardo Norcia; (2) the Senior Vice President and Chief Financial Officer, David Ruud; (3) the Senior Vice President, Peter B. Oleksiak; (4) the Executive Chairman of the Board, Gerard M. Anderson; (5) the President and Chief Operating Officer—DTE Electric, Trevor F. Lauer; and (6) the Vice Chairman and Chief Administrative Officer, David E. Meador. Mr. Oleksiak served as Chief Financial Officer until May 4, 2020. In addition, the term “executive” includes the Named Executive Officers, other key employees of the Company as designated by management from time to time and Executive Officers as defined by the Exchange Act.
Philosophy and Objectives
Our executive compensation philosophy is to motivate and reward executives who achieve short-term and long-term corporate and financial objectives leading to the success of the Company. We will continue to emphasize performance-based compensation for results that are consistent with shareholder and customer interests. The main objectives underlying this philosophy are:

Compensation must be competitive in order to attract and retain talented executives — data from peer group companies are taken into consideration when analyzing our compensation practices and levels;
38 DTE ENERGY 2021 PROXY STATEMENT


Compensation should have a meaningful performance component — a portion of an executive’s total compensation opportunity is linked to predefined short-term and long-term corporate and financial objectives along with an executive’s individual performance; and
Compensation must include equity-based elements to encourage executives to have an ownership interest in the Company.
Role of the Organization and Compensation Committee
The Board has a long-standing process for determining executive compensation that is performance-based, objective and transparent. The process is designed to serve the purpose of recruiting, retaining and motivating executives for the benefit of shareholders and customers. The Board delegates to the O&C Committee the responsibility to determine and approve the CEO’s compensation, and to approve the compensation of certain other executives. The O&C Committee makes all decisions regarding compensation for the Named Executive Officers. Although the responsibilities have been delegated, the entire Board maintains oversight and receives direct reports after each O&C Committee meeting.
The O&C Committee is composed entirely of independent directors, none of whom derives a personal benefit from the compensation decisions the O&C Committee makes. Generally, the O&C Committee is responsible for our executive compensation programs throughout the enterprise (including subsidiaries). The O&C Committee responsibilities are more fully detailed in its charter, which is available at dteenergy.com/governance. The O&C Committee continually monitors the executive compensation program and adopts changes to reflect the dynamic marketplace in which we compete for talent. To the extent necessary, the O&C Committee also works with other Board committees to review or approve reports, awards and other matters relating to compensation. For example, the Finance Committee reviews the financial components of performance measures and metrics, the Corporate Governance Committee assists in the review of this Compensation Discussion and Analysis and the Audit Committee reviews the internal controls over the data reported herein.
The O&C Committee uses information from several external sources to monitor and achieve an executive compensation program that supports our business goals and attracts executives whose performance will be measured against those goals. Independent outside consultants and external information enable the O&C Committee to maintain impartial decision-making regarding performance and pay. The O&C Committee annually reviews each component of the Named Executive Officers’ compensation and is advised directly by the outside compensation consulting firm, discussed in further detail below, in connection with such review. Based on input from its consultant and from management and based on a review of competitive data from peer group companies (as discussed below), the O&C Committee believes that the current structure is appropriately balanced and competitive to accomplish the important tasks of recruiting, retaining and motivating talented executives in the energy industry in which we compete.
The O&C Committee also reviews and considers the results from the most recent shareholder advisory vote on executive compensation. At the 2020 and 2019 annual meetings, 96.3% and 94.8%, respectively, of voting shareholders approved the compensation of the Named Executive Officers. As part of our shareholder engagement program, we seek feedback from shareholders about our compensation practices.
Independent Review of Compensation Program
The O&C Committee directly employs an outside consulting firm, Meridian Compensation Partners LLC ("Meridian"), to advise the O&C Committee on various executive compensation matters, including current compensation trends, and provide objective recommendations as to the design of our executive compensation program. Meridian reports directly to the O&C Committee. Use of an outside consultant is an important component of the compensation setting process, as it enables the O&C Committee to make informed decisions based on market data and practices.
The representative from Meridian, who is considered a leading professional in the compensation field, attends O&C Committee meetings, meets with Committee members in executive session, consults with the members as required and provides input with regard to the CEO’s compensation and performance.
Meridian has served as the O&C Committee’s outside consultant since June 2018. The O&C Committee has determined Meridian to be an independent consultant. Meridian has no affiliations with any of the Named Executive Officers or members of the Board other than in its role as an outside consultant. The lead consultant and partner in charge for


DTE ENERGY 2021 PROXY STATEMENT 39


Meridian, who provided executive compensation consulting services to the O&C Committee, did not provide any other services to the Company.
Management’s Role
Our management works closely with the O&C Committee in the executive compensation process. Excluding the Executive Chairman and President and CEO’s compensation, management’s responsibilities include:
 
Recommending performance measures and metrics that are formulated based on our corporate strategy and priorities;
Reporting executive performance evaluations;
Recommending base salary levels and other compensation, including equity awards; and
Recommending appointment of executives.
The Executive Chairman and President and CEO’s compensation is determined solely by the O&C Committee, which bases its decisions on performance and market studies along with participation and recommendations from its independent outside consultant.
Compensation and Peer Group Assessment
Each component of executive compensation (see “Key Components of Executive Compensation” below) is compared, measured and evaluated against a peer group of companies. The O&C Committee approves the peer group and periodically reviews and updates the companies included in that group.
The most recent peer group was approved by the O&C Committee in June 2018. That peer group, which is applicable for 2020, consists of the companies listed below. Most of these companies, along with DTE Energy, participate in the same independent compensation surveys. The surveys provide data needed for accurate compensation comparisons. The peer group consists primarily of utilities (including utility holding companies), broad-based energy companies, and significant non-energy companies selected on the basis of revenues, financial strength, geographic location and availability of compensation information. The O&C Committee reviews the peer group data when making compensation decisions relating to the Named Executive Officers and the Company’s mix of compensation components.
Management also retains an external consulting firm to conduct a market study covering compensation practices for similar positions in the peer group. The most recent market study was completed in August 2019 by Aon, whose comprehensive database included all of our desired utility/energy peer companies and also included data for most of our utility/energy-related executive positions.
Energy Peer GroupNon-Energy Peer Group
AlliantEntergy CorporationCummins Inc.
Ameren CorporationFirstEnergy Corp.Illinois Tool Works
American Electric Power Company, Inc.NiSource, Inc.Kellogg Company
Avangrid Inc.PG&E CorporationMasco Corporation
CenterPoint EnergyPublic Service Enterprise GroupNavistar International Corporation
CMS Energy CorporationSempra EnergyOwens Corning
Consolidated EdisonSouthern CompanyParker Hannifin Corporation
Duke Energy CorporationWEC Energy Group, Inc.The Sherwin-Williams Company
Edison InternationalXcel Energy, Inc.Whirlpool Corporation
40 DTE ENERGY 2021 PROXY STATEMENT


Key Components of Executive Compensation
The key components of the compensation program include the following:

Base Salary
Annual and Long-Term Incentives
Retirement and Other Benefits
Post-Termination Agreements (Severance and Change-In-Control)
While the programs and pay levels reflect differences in job responsibilities, the structure of the compensation and benefits program is applied consistently to our Named Executive Officers, including the CEO. Differences in compensation between the CEO and the other Named Executive Officers are due, in part, to an analysis of peer group benchmark data, as well as differences in the responsibilities of each Named Executive Officer. We review each element of total compensation, both individually and on a combined basis, for each Named Executive Officer and make adjustments as appropriate based on these comparisons. The following is a more detailed discussion of the components of the Company’s executive compensation program:
Base Salary
The objective of base salary is to provide a stable, fixed source of income that reflects an executive’s job responsibilities, experience, value to the Company, and demonstrated performance. When setting individual base salary levels, we consider several factors, including (i) the market reference point for the executive’s position, (ii) the responsibilities of the executive’s position, (iii) the experience and performance of the executive, and (iv) retention issues. Market reference points target the median for most positions, adjusted to take into account differences in company size within the peer group. In addition, we establish midpoints for each executive group level for determining base salary for those executives whose jobs cannot be easily matched in the marketplace. These midpoints are consistent with the market reference points for other executives in the same executive group. We review these midpoints annually to ensure they are consistent with the market and make salary adjustments, when appropriate.
We have two primary types of incentives that reward executives for performance. The incentives are designed to tie compensation to performance and encourage executives to align their interests with those of the shareholders and customers of the Company. Our annual incentives allow us to reward executives with annual cash bonuses for performance against pre-established objectives based on work performed in the prior year. Our long-term incentives allow us to grant executives long-term equity incentives to encourage continued employment with DTE Energy, to accomplish pre-defined long-term performance objectives and to create shareholder alignment.
We believe the current mix among base salary, annual incentives, and long-term incentives is appropriately set to provide market-competitive compensation when Company performance warrants. The mix is more heavily weighted toward incentive compensation at higher executive levels within DTE Energy. The interplay between the annual incentives and the long-term incentives provides a balance to motivate executives to achieve our business goals and objectives and to properly reward executives for the achievement of such goals and objectives.
The Board has implemented a “clawback” policy enabling the Company to recover some or all of the performance-based compensation awarded to current or former executives. Under the policy, if the Company is required to prepare an accounting restatement due to material noncompliance with federal securities laws, and the O&C Committee determines it appropriate, the Company may recover from any current or former executive any previously awarded performance-based compensation the executive received (including awards under the Annual Incentive Plan and the Long-Term Incentive Plan) in excess of performance-based compensation that would have been awarded under the restatement. This "clawback" would apply to performance-based compensation during the three-year period preceding the date on which the Company is required to prepare an accounting restatement, in accordance with applicable law and regulations.


DTE ENERGY 2021 PROXY STATEMENT 41


Annual Incentives
The objective of the annual incentives is to compensate individuals yearly based on the achievement of specific annual goals and tie compensation to near-term performance. Annual incentive awards are paid to our executives under the DTE Energy Annual Incentive Plan (“Annual Incentive Plan”). The O&C Committee sets individual performance measures, metrics and targets for the Named Executive Officers for each year using the measure, metrics, targets and procedures described below, and the Named Executive Officer’s performance against those measures, metrics and targets is considered when the O&C Committee determines the officer’s annual incentive award under the Annual Incentive Plan for that year.
Under the terms of the Annual Incentive Plan, participating executives and other select employees may receive annual cash awards based on performance compared against pre-established Company and business unit objectives. Objectives that management proposes are reviewed and approved or revised by the O&C Committee, with financial goal recommendations reviewed by the Board’s Finance Committee, usually within the first 90 days of the performance period. The objectives include performance measures in several categories that are critical to our success. When setting these objectives, management and the O&C Committee determine the elements of our business that require the focused attention of the executives. The weights, which can change from year to year, are determined based on the Company’s key priorities and areas of focus for the upcoming year. The final awards, if any, are paid after the O&C Committee approves the final results of each objective.
The amount of an executive’s Annual Incentive Plan award is determined as follows:
 
The executive’s most recent year-end base salary is multiplied by an Annual Incentive Plan target percentage to arrive at the target award.
The overall performance payout percentage, which can range from 0% to 175%, is determined based on final results compared to threshold, target and maximum levels for each objective.
The target award is then multiplied by the performance payout percentage to arrive at the pre-adjusted calculated award.
The pre-adjusted calculated award is then adjusted by an individual performance modifier (assessment of an individual executive’s achievements for the year), which can range from 0% to 150%, to arrive at the final award.
Each objective has a threshold, target and maximum level. The Company or relevant business unit must attain a minimum level of achievement for an objective before any compensation is payable with respect to that objective. The minimum established level of each objective will result in a payout of 25% of target and the maximum established for each level (or better) will result in a payment of 175% of target.
The operating earnings per share and cash flow measures were chosen as indicators of the Company’s financial strength. The customer satisfaction, employee engagement and safety performance and effectiveness measures were selected to make the Company more responsive to our customers’ needs and to make the Company a safer and better place to work. For Messrs. Norcia, Ruud, Oleksiak, Anderson, and Meador, the Utility Operating Excellence measures were chosen as representative of (a) electric generation and distribution reliability, (b) gas system reliability, gas system availability and the pace of gas system improvements, and (c) nuclear operational measures. For Mr. Lauer, the DTE Electric Operating Excellence measures were chosen as representative of electric generation and distribution reliability.
For 2020, the performance objectives and the related weightings, thresholds, targets, maximums and results for calculating the Named Executive Officers’ pre-adjusted annual incentive award amounts were as follows.

42 DTE ENERGY 2021 PROXY STATEMENT


For Messrs. Norcia, Ruud, Oleksiak, Anderson, and Meador:
MeasuresWeightThresholdTargetMaximumResultPayoutWeighted
Average
Payout
DTE Energy Operating Earnings Per Share20.00 %$6.47 $6.61 $6.75 $7.19 175.0 %35.00 %
DTE Energy Adjusted Cash Flow ($ millions)20.00 %$(778)$(184)$410 $527 175.0 %35.00 %
Customer Satisfaction Index (percentile)8.00 %76 %81 %86 %69 %0.0 %0.00 %
Customer Satisfaction Improvement Program (DPMO)4.00 %62,36359,08155,79848,947175.0 %7.00 %
Customer Satisfaction Improvement Program (+1PMO)4.00 %107,587112,966118,34682,5260.0 %0.00 %
MPSC Customer Complaints4.00 %2,1342,0701,9091,657175.0 %7.00 %
DTE Energy Employee Engagement– Gallup5.00 %4.18 4.32 4.45 4.36 123.1 %6.16 %
Safety Performance & Effectiveness Index:
DTE Energy OSHA Recordable Incident Rate5.00 %0.79 0.64 0.46 0.40 175.0 %8.75 %
DTE Energy OSHA DART5.00 %0.39 0.32 0.20 0.23 153.9 %7.70 %
Utility Operating Excellence Index:
SAIDI excluding MEDs (minutes)1.66 %165 149 134 142 135.0 %2.24 %
Blue Sky CAIDI (minutes)1.67 %117 108 97 106 113.6 %1.89 %
CEMI6%1.67 %2.00 %1.81 %1.63 %2.15 %0.00 %0.00 %
Tree Trimming Mileage1.67 %5,100 5,500 5,900 5,589 116.7 %1.95 %
Fossil Power Plant Reliability2.33 %7.8 %6.8 %5.8 %5.5 %175.0 %4.08 %
Nuclear On-Line Unit Capability Factor (UCF)4.67 %96.6 %97.6 %98.6 %97.8 %115.0 %5.37 %
Wind Time-Based Availability0.33 %97.3 %97.8 %98.0 %97.8 %100.0 %0.33 %
Nuclear RFO Unplanned Risk Color Changes2.00 %1N/A00175.0 %3.50 %
Nuclear RFO Dose2.00 %275.1 262.0 248.9 501.1 0.0 %0.00 %
Nuclear RFO Duration2.00 %56 51 46 138 0.0 %0.00 %
Gas Distribution System Improvement (leaks)1.25 %1,373 973 673 2,066 0.0 %0.00 %
Gas Distribution Response Time (minutes)0.75 %23.6 22.5 21.4 21.6 160.0 %1.20 %
Lost and Unaccounted for Gas0.75 %0.67 %0.56 %0.45 %0.67 %25.0 %0.19 %
Gas Compression Reliability0.75 %97.0 %98.0 %99.0 %99.5 %175.0 %1.31 %
Gas Damage Prevention Effectiveness0.75 %4.5 4.1 3.7 4.3 60.6 %0.45 %
Meter Assembly Check (MAC) Backlog0.75 %61,950 59,000 56,050 58,285 118.2 %0.89 %
Total100.00 %130.01 %
The measures in the above table are defined below:
DTE Energy Operating Earnings Per Share: DTE Energy reported earnings after operating adjustments divided by average shares outstanding. See page 2 for a discussion of operating earnings.
DTE Energy Adjusted Cash Flow: DTE Energy net cash from operating activities adjusted by utility capital investments, asset sale proceeds and other items approved by the O&C Committee.
Customer Satisfaction Index: Measures the satisfaction of four customer segments: (1) electric residential, (2) gas residential, (3) electric business, and (4) gas business using industry standard methodology developed by JD Power and Associates (“JDPA”) to determine performance percentile relative to large peers.
Customer Satisfaction Improvement Program (DPMO): The calculation for defects per million opportunities (“DPMO”) based on defects from DTE Cares Callbacks.
Customer Satisfaction Improvement Program (+1PMO): The calculation for plus ones per million opportunities based on field transactions, call center transactions, self-service transactions, home energy consultations and advocacy transactions.


DTE ENERGY 2021 PROXY STATEMENT 43


MPSC Customer Complaints: Number of complaints received by Michigan Public Service Commission (“MPSC”) in the calendar year for all business units across DTE Energy.
DTE Energy Employee Engagement–Gallup: The DTE Energy Company Gallup Grand Mean score from the annual survey.
Safety Performance and Effectiveness Index: Includes two measures that are a representation of safety performance:
1. DTE Energy OSHA Recordable Incident Rate: Number of Occupational Safety and Health Administration (“OSHA”) defined recordable injuries in the calendar year per 100 employees divided by the actual number of hours worked.
2. DTE Energy OSHA Days Away, Restricted and Transfers Rate: The number of OSHA defined recordable injuries that resulted in days away from work, work restrictions, and/or job duty/position transfer due to work-related injuries (DART) in the calendar year per 100 employees divided by the actual number of hours worked.
Utility Operating Excellence Index: Corporate index that encompasses 16 operating excellence measures:
1. SAIDI (System Average Interruption Duration Index), excluding MEDs (Major Event Days): For all customers served, the average minutes of interruption, excluding days exceeding the "Major Event Day" threshold.
2. Blue Sky CAIDI (Customer Average Interruption Duration Index): The average minutes of interruption for all customers experiencing an outage for those days when there is no declared storm. A storm is declared when there are 15,000 outages over a 24 hour period.
3. CEMI6%: Customers experiencing multiple interruptions greater than or equal to six in a calendar year.
4. Tree Trimming Mileage: Total overhead sub-transmission and distribution circuit miles trimmed, including circuits trimmed in support of construction projects and annual maintenance plan.
5. Fossil Power Plant Reliability: The Monroe and Belle River Random Outage Factor (ROF) which is the weighted average of the six base load coal units’ year-end ROF. A unit’s ROF is the percentage of time that a unit is not capable of reaching 100% capacity, excluding planned outages.
6. Nuclear On-Line Unit Capability Factor (UCF): Ratio of available energy to the reference energy generation, over the same time period, expressed as a percentage, excluding outage or outage extension time.
7. Wind-Time Based Availability: Time in a calendar year that DTE-owned wind turbines are ready and able to produce power.
8. Nuclear RFO Unplanned Risk Color Changes: Measure of deviation from the refueling outage risk plan counting the number of unplanned events.
9. Nuclear RFO Dose: The annual total radiological dose exposure accumulated for all personnel (DTE personnel, supplemental personnel, and visitors) working at Fermi 2 during the Spring 2020 refueling outage.
10. Nuclear RFO Duration: Time between the breaker open to the breaker closed that the plant is off-line to refuel the reactor.
11. Gas Distribution System Improvement: The number of open leaks in the system as of December 31, 2020.
12. Gas Distribution Response Time: Elapsed time in minutes from when the customer reports the condition to when the field service employee arrives at the site.
13. Lost and Unaccounted for Gas: Lost and unaccounted for gas from the source and disposition report measured as a percentage of total throughput. It is a function of multiple contributors including transmission losses, theft, leaks, billing inaccuracies and metering equipment condition.
14. Gas Compression Reliability: Percentage of time that gas compressor units operate without failure when dispatched.
44 DTE ENERGY 2021 PROXY STATEMENT


15. Gas Damage Prevention Effectiveness: Number of second and third-party damages to main and service gas lines per 1,000 tickets. A ticket is defined as one unique ticket received from 811 (MISS DIG).
16. Meter Assembly Check (MAC) Backlog: The number of remaining overdue MACs on December 31, 2020.
The aggregate weighted payment percentage for the pre-adjusted calculated award was 130.01% for Messrs. Norcia, Ruud, Oleksiak, Anderson, and Meador.
For Mr. Lauer:
MeasuresWeightThresholdTargetMaximumResultPayoutWeighted
Average
Payout
DTE Electric Operating Earnings ($ millions) 15.00 %$731 $770 $809 $836 175.0 %26.25 %
DTE Electric Adjusted Cash Flow ($ millions)15.00 %$(1,107)$(943)$(778)$(816)157.7 %23.66 %
DTE Energy Operating Earnings Per Share10.00 %$6.47 $6.61 $6.75 $7.19 175.0 %17.50 %
Customer Satisfaction Index (percentile)7.00 %76 %81 %86 %69 %0.0 %0.00 %
Customer Satisfaction Improvement Program (DPMO)2.00 %62,363 59,081 55,798 48,947 175.0 %3.50 %
Customer Satisfaction Improvement Program (+1PMO)
2.00 %107,587 112,966 118,346 82,526 0.0 %0.00 %
MPSC Customer Complaints4.00 %2,134 2,070 1,909 1,657 175.0 %7.00 %
DTE Electric Employee Engagement– Gallup7.50 %4.18 4.32 4.45 4.38 134.6 %10.10 %
Safety Performance & Effectiveness Index:
DTE Electric OSHA Recordable Incident Rate3.75 %0.84 0.67 0.50 0.41 175.0 %6.56 %
DTE Electric OSHA DART3.75 %0.39 0.32 0.20 0.27 129.4 %4.85 %
DTE Electric Operating Excellence Index:
SAIDI, excluding MEDs (minutes)5.00 %165 149 134 142 135.0 %6.75 %
Blue Sky CAIDI (minutes)5.00 %117 108 97 106 113.6 %5.68 %
CEMI6%5.00 %2.00 %1.81 %1.63 %2.15 %0.00 %0.00 %
Tree Trimming Mileage5.00 %5,100 5,500 5,900 5,589 116.7 %5.84 %
Nuclear On-Line Unit Capability Factor (UCF)2.00 %96.6 %97.6 %98.6 %97.8 %115.0 %2.30 %
Wind Time-Based Availability1.00 %97.3 %97.8 %98.0 %97.8 %100.0 %1.00 %
Fossil Power Plant Reliability7.00 %7.8 %6.8 %5.8 %5.5 %175.0 %12.25 %
Total100.00 %133.24 %
The measures in the above table are defined below:
DTE Electric Operating Earnings: DTE Electric operating earnings with allowed adjustments.
DTE Electric Adjusted Cash Flow: DTE Electric net cash from operating activities adjusted by utility capital investments, asset sale proceeds and other items approved by the O&C Committee.
DTE Energy Operating Earnings Per Share: DTE Energy reported earnings after operating adjustments divided by average shares outstanding. DTE Energy management believes that operating earnings provide a more meaningful representation of the company's earnings from ongoing operations and uses operating earnings as the primary performance measurement internally and externally. Operating earnings can be reconciled to our reported earnings as set forth in the table on page 2.
Customer Satisfaction Index: Measures the satisfaction of four customer segments: (1) electric residential, (2) gas residential, (3) electric business, and (4) gas business using industry standard methodology developed by JD Power and Associates (“JDPA”) to determine performance percentile relative to large peers.
Customer Satisfaction Improvement Program (DPMO): The calculation for defects per million opportunities (“DPMO”) based on defects from DTE Cares Callbacks.


DTE ENERGY 2021 PROXY STATEMENT 45


Customer Satisfaction Improvement Program (+1PMO): The calculation for plus ones per million opportunities based on field transactions, call center transactions, self-service transactions, home energy consultations and advocacy transactions.
MPSC Customer Complaints: Number of complaints received by the Michigan Public Service Commission (“MPSC”) in the calendar year for all business units across DTE Energy.
DTE Electric Employee Engagement–Gallup: The DTE Electric Gallup Grand Mean score from the annual survey.
Safety Performance and Effectiveness Index: Includes two measures that are a representation of safety performance:
1. DTE Electric OSHA Recordable Incident Rate: Number of Occupational Safety and Health Administration (“OSHA”) defined recordable injuries in the calendar year per 100 employees divided by the actual number of hours worked.
2. DTE Electric OSHA Days Away, Restricted and Transfers Rate: The number of OSHA defined recordable injuries that resulted in days away from work, work restrictions, and/or job duty/position transfer due to work-related injuries (DART) in the calendar year per 100 employees divided by the actual number of hours worked.
DTE Electric Operating Excellence Index: Index that encompasses seven operating excellence measures:
1. SAIDI (System Average Interruption Duration Index), excluding MEDs (Major Event Days): For all customers served, the average minutes of interruption, excluding days exceeding the "Major Event Day" threshold.
2. Blue Sky CAIDI (Customer Average Interruption Duration Index): The average minutes of interruption for all customers experiencing an outage for those days when there is no declared storm. A storm is declared when there are 15,000 outages over a 24 hour period.
3. CEMI6%: Customers experiencing multiple interruptions greater than or equal to six in a calendar year.
4. Tree Trimming Mileage: Total overhead sub-transmission and distribution circuit miles trimmed, including circuits trimmed in support of construction projects and annual maintenance plan.
5. Nuclear On-Line Unit Capability Factor (UCF): Ratio of available energy to the reference energy generation, over the same time period, expressed as a percentage, excluding outage or outage extension time.
6. Wind Time Based Availability: Time in a calendar year that DTE-owned wind turbines are ready and able to produce power.
7. Fossil Power Plant Reliability: The Monroe and Belle River Random Outage Factor (ROF) which is the weighted average of the six base load coal units’ year-end ROF. A unit’s ROF is the percentage of time that a unit is not capable of reaching 100% capacity, excluding planned outages.
The aggregate weighted payment percentage for the pre-adjusted calculated award was 133.24% for Mr. Lauer.
The pre-adjusted awards are adjusted by an individual performance modifier for each of the Named Executive Officers. Individual performance criteria are set at the beginning of each calendar year for each of the Named Executive Officers. For 2020, qualitative criteria include, as applicable, leadership performance, overall operational performance, employee engagement and customer performance, diversity and inclusion, continuous operational improvements and other appropriate operating measures. The O&C Committee evaluates the individual performance of each of the Named Executive Officers and approves an adjustment to the annual award based on the individual contribution and performance. The individual performance modifier adjusts a Named Executive Officer’s annual cash bonus such that the Named Executive Officer’s actual cash bonus ranges between zero and 150% of the pre-adjusted calculated award. For 2020, the individual performance modifiers for the Named Executive Officers ranged from 90% to 150%.
46 DTE ENERGY 2021 PROXY STATEMENT


Long-Term Incentives
Long-term incentives provide the O&C Committee the ability to align programs that focus on our long-term performance over a three-year period, with the objective of aligning executives’ interests with those of our shareholders. Our principles for ownership of stock, discussed on page 51, ensure that the executives and other employees have a vested interest in the long-term financial health, management and success of the Company.
The long-term incentives are awarded under the Long-Term Incentive Plan and reward executives and other employees with stock-based compensation.
Named Executive Officers are eligible to receive restricted stock, performance shares, performance units, stock options or a combination of these awards. Since the creation of the Long-Term Incentive Plan, we have granted only performance shares, time-based restricted stock and nonqualified stock options. However, the O&C Committee has not granted stock options under the Long-Term Incentive Plan since 2010. Executives receive long-term incentive grants based upon a target percentage of base salary. The targeted award levels for the Named Executive Officers for 2020 were as follows: Mr. Norcia, 450% of base salary; Mr. Ruud, 115% of base salary; Mr. Oleksiak, 250% of base salary; Mr. Anderson, 250% of base salary; Mr. Lauer, 215% of base salary; and Mr. Meador, 240% of base salary. In addition to the targeted award levels, the O&C Committee also considers previous years’ grants, career potential and retention issues in determining the final number of awards granted.
The value of each element of these long-term incentive grants for 2020 was as follows:
Performance Shares  Approximately 70%
Restricted Stock  Approximately 30%
This mix was designed to provide a balance of incentives to executives for creating long-term shareholder value through strong financial and operating performance and to align executive interests with shareholder interests.
Performance Shares Granted in 2020:     In 2020, performance shares represented approximately 70% of the overall long-term incentive grant value. Granting of performance shares allows us to tie long-term performance objectives with creating shareholder value. Performance shares entitle the executive to receive a specified number of shares, or a cash payment equal to the fair market value of the shares, or a combination of the two, in the plan administrator’s discretion, depending on the level of achievement of performance measures. The performance measurement period for the 2020 grants is January 1, 2020 through December 31, 2022. Payments earned under the 2020 grants and the related performance measures are described in footnote 2 to the “Grants of Plan-Based Awards” table on page 55. In the event a participant retires (age 65 or age 55 or older with at least 10 years of service), dies or becomes disabled, the participant or beneficiary retains the right to a pro-rated number of the performance shares that would otherwise have been payable based upon actual results for the entire performance period. In the event employment terminates for any other reason, the participant forfeits all rights to any outstanding performance shares. In June 2009, the O&C Committee decided that, beginning with the 2010 performance share grants, dividends or dividend equivalents would not be paid on unvested or unearned performance shares. During the period beginning on the date the performance shares are awarded and ending on the certification date of the performance objectives, the number of performance shares awarded will be increased, assuming full dividend reinvestment at the fair market value on the dividend payment date. The cumulative number of performance shares will be adjusted to determine the final payment based on the performance objectives as certified by the Committee.
Performance Shares Paid in 2020:     The performance shares granted in 2017 were paid in early 2020. The payout amounts were based upon performance measures, each of which was weighted to reflect its importance to the total calculation. The Company had to attain a minimum level for each measure before any compensation was payable with respect to that measure. The minimum established level of each measure would have resulted in a payout of 50% of target, and an established maximum (or better) for each level would have resulted in a payout of 200% of target. The payout amount was based upon the following performance measures (and related weighting):


DTE ENERGY 2021 PROXY STATEMENT 47


Long-Term Incentive Plan (2020 Payout of Awards Granted in 2017)

For Messrs. Norcia, Oleksiak, Anderson, and Meador:
MeasuresWeightThresholdTargetMaximumResultPayout
%
Weighted
Average
Payout %
Total Shareholder Return: DTE vs. Peer Group80%25th percentile50th percentile75th percentile55.0%120.0%96.0%
Balance Sheet Health— FFO to Debt Ratio20%16.6%18.6%20.6%19.1%125.0%25.0%
Total100%121.0%

For Mr. Ruud:
MeasuresWeight  ThresholdTargetMaximumResultPayout
%
Weighted
Average
Payout %
Total Shareholder Return: DTE vs. Peer Group40%25th percentile50th percentile75th percentile55.0%120.0%48.0%
Balance Sheet Health—FFO to Debt Ratio10%16.6%18.6%20.6%19.1%125.0%12.5%
Power and Industrial Net Present Value of New Transactions25%$15M30.0%$45M$107M200.0%50.0%
Power and Industrial Long-Range Earnings Growth25%$25M$32.5M$40M52.2%200.0%50.0%
Total100%160.5%

For Mr. Lauer:
MeasuresWeight  ThresholdTargetMaximumResultPayout
%
Weighted
Average
Payout %
Total Shareholder Return: DTE vs. Peer Group60%25th percentile50th percentile75th percentile55.0%120.0%72.0%
Balance Sheet Health—FFO to Debt Ratio20%16.6%18.6%20.6%19.1%125.0%25.0%
DTE Electric Average Return on Equity 2017-201920%9.6%10.1%10.6%10.2%120.0%24.0%
Total100%121.0%
The measures in the above tables are defined below:
Total Shareholder Return: Total DTE Energy shareholder return compared to 22 peer group companies (as defined below) based on the average share prices from December 2016 to December 2019
Balance Sheet Health—FFO (Funds from Operations) to Debt: Measures cash flow coverage as a ratio of FFO to debt where:

FFO is defined as the sum of: (1) operating net income, (2) deferred taxes, (3) depreciation and amortization, (4) income statement impact of capitalizing operating leases, and (5) 50% of the interest (after-tax) on DTE Energy's Junior Subordinated Debt; and
Debt is defined as all long-term and short-term debt of DTE Energy Company, adjusted as follows: (1) exclude portion of DTE Gas’s short-term debt attributable to seasonal working capital needs; (2) exclude 50% of DTE Energy’s Junior Subordinated Debt; (3) exclude mandatory convertible notes and (4) include balance sheet impact of capitalizing operating leases.
Power and Industrial Net Present Value of New Transactions: Simple average of new transaction net present value (NPV) for each year of the 3-year period, measured on December 31 of each year.
48 DTE ENERGY 2021 PROXY STATEMENT


Power and Industrial Long-Range Earnings Growth: The measure of new and updated contracts completed between 2017 and 2019 that will generate earnings in 2022, as well as overhead cost reductions realized by 2019.
DTE Electric Average Return on Equity 2017-2019: DTE Electric’s three-year average segment return on equity, expressed as a percentage, calculated based on operating income.
The peer group for the performance shares granted under the Long-Term Incentive Plan, as approved by the O&C Committee, consists of the companies set forth below. These companies were selected because of a combination of the following: (1) their operations being largely regulated; (2) their size (based on market capitalization); and (3) their business strategies being similar to those of DTE Energy. In creating this peer group, the Company started with national public utilities with market capitalization above $1.5 billion. The Company then focused on companies with value concentrated in regulated electric and gas with at least 50% in regulated electric, and eliminated companies with large merchant and/or other non-regulated exposure. In addition, companies that were in the process of being acquired were also eliminated. The O&C Committee reviews and approves this peer group annually.
Alliant Energy Corporation  IDACORP Inc.
ALLETE, Inc.NiSource. Inc.
Ameren CorporationNorthWestern Energy
Avista Corporation  OG&E Energy Corp.
CenterPoint Energy, Inc.  PG&E Corporation
CMS Energy Corporation  Pinnacle West Capital Corporation
Consolidated Edison, Inc.  PNM Resources, Inc.
Dominion Energy  Portland General Electric Company
Duke Energy Corporation  Southern Company
Evergy  Wisconsin Energy Corporation
Eversource Energy  Xcel Energy, Inc.
Total shareholder return compared to the Peer Group is the primary measure because it reflects how well our Company has performed on total return to its shareholders relative to the total shareholder returns of similar companies.
As displayed above, the 2020 payout levels approved by the O&C Committee were 121% for Messrs. Norcia, Oleksiak, Anderson, and Meador, 160.5% for Mr. Ruud, and 121% for Mr. Lauer. Payouts for the NEOs under the Long-Term Incentive Plan for 2018 and 2019 ranged from 100.7% to 187%. For more details of the 2020 payouts see footnote 2 to the “Option Exercises and Stock Vested in 2020” table on page 56.
Restricted Stock:    The restricted stock grants are time-based and generally include a three-year vesting period. The granting of restricted stock allows us to grant executives long-term equity incentives to encourage continued employment. In 2020, restricted stock was granted, representing approximately 30% of the overall Long-Term Incentive Plan grant value, with the restriction period ending on January 29, 2023. The three-year vesting period focuses on long-term value creation and executive retention. The three-year vesting period requires continued employment throughout the restriction period. In the event a participant retires (age 65 or age 55 or older with at least 10 years of service), dies or becomes disabled, the participant or beneficiary retains the right to a pro-rated number of restricted shares. In the event employment terminates for any other reason, the participant forfeits all rights to any outstanding restricted shares.
Pension and Deferred Compensation
Pension Benefits
Substantially all non-represented employees hired prior to 2012, including our Named Executive Officers, are eligible to participate in our tax-qualified pension plan, the DTE Energy Company Retirement Plan. Named Executive Officers are also eligible to participate in our nonqualified pension plans, the DTE Energy Company Supplemental Retirement Plan and the DTE Energy Company Executive Supplemental Retirement Plan.


DTE ENERGY 2021 PROXY STATEMENT 49


Deferred Compensation
Substantially all employees, including our Named Executive Officers, are eligible to participate in one of our tax-qualified 401(k) plans. The Named Executives Officers participate in the DTE Energy Company Savings and Stock Ownership Plan. Our Named Executive Officers are also eligible to participate in our nonqualified 401(k) plan, the DTE Energy Company Supplemental Savings Plan.
Providing supplemental pension and deferred compensation benefits for our executives is in keeping with our philosophy and objectives to attract and retain talented executives. The Pension Benefits Table and related footnotes beginning on page 57 describe both the tax-qualified and nonqualified pension benefits for which certain executives are eligible and which are commonly offered by other employers in our peer group.
For further description of the nonqualified supplemental pension and deferred compensation benefits, see “Pension Benefits” beginning on page 57.
Executive Benefits
We provide executives with certain benefits generally not available to our other employees as a matter of competitive practice and as a retention tool. The O&C Committee periodically reviews the level of benefits provided to executives against a peer group to ensure they are reasonable and consistent with our overall compensation objectives.
We provide a cash allowance to certain executives in lieu of executive benefits typically provided by other companies. The executive is permitted to use the allowance as he or she deems appropriate. Although the allowance is taxable for income tax purposes, it is not considered as compensation for any Company incentive or benefit program. This cash allowance was eliminated for Messrs. Norcia and Anderson effective August 2019, Messrs. Lauer, Oleksiak, and Meador effective March 2020, and Mr. Ruud effective June 2020.
During 2020, we provided various benefits for a limited number of officers that included the following:
 
Security driver for business: Based on our executive security policies and a security risk assessment by the Company’s chief security officer, the Board requires Mr. Norcia to use a Company car and security driver while on Company business. The Company has also provided Mr. Anderson with a Company car and security driver to use while on Company business.
Corporate aircraft for limited business travel: We lease a fractional share of an aircraft for limited business travel by executives and other employees when there is an appropriate business purpose. Personal use of the aircraft is not allowed except in unusual circumstances and requires the prior approval of the CEO or Audit Committee. During 2020, there was no personal use of the corporate aircraft by any executive.
Supplemental retirement benefits: Certain executives are eligible for both tax-qualified and non-qualified retirement benefits which are commonly offered by other employers in our peer group. For further description of the supplemental retirement benefits, see "Pension Benefits" beginning on page 57.
Other benefits: Executives are allowed the limited use of corporate event tickets and the corporate condominium when available. The Company also provides home security monitoring for some executives, including some of the Named Executive Officers.
Post-Termination Agreements
We have entered into indemnification agreements and change-in-control agreements with each of the Named Executive Officers and certain other executives. The indemnification agreements require that we indemnify these individuals for certain liabilities to which they may become subject as a result of their affiliation with the Company. The change-in-control agreements are intended to provide continuity of management in the event there is a change in control of the Company and to align executive and shareholder interests in support of corporate transactions. The important terms of, and the potential payments provided under, the change-in-control agreements are described beginning on page 61. Additionally, the Company has entered into an employment agreement with Mr. Norcia, whereby he is eligible for benefits including severance pay, bonus payment, restricted and performance share payout, and health and welfare benefits if he resigns for good reason (including demotion, involuntary relocation, or reduction in salary) or is terminated without cause (with "cause" defined as conviction of a crime, commission of fraud, material violation of Company policy, or conduct that results in material harm to the Company).
50 DTE ENERGY 2021 PROXY STATEMENT


Stock Ownership Policy
Our principles for ownership of stock ensure that the executives and other employees have a vested interest in the financial health, management and success of the Company. We expect most executives and certain other employees to own, within five years of their appointment to such position, shares of our stock having a value equal to a multiple of their annual base salary. Common stock, time-based restricted stock, phantom stock and unvested performance shares (assuming achievement of target levels of performance) are counted toward the fulfillment of this ownership requirement. The following are the requirements for the Named Executive Officers: (i) for Messrs. Norcia and Anderson, five times their respective base salary; (ii) for Mr. Meador, four times his base salary; and (iii) for Messrs. Ruud and Lauer, three times their respective base salary. Other executives and employees may be required to hold from one to three times their base salaries as determined by their executive group level within the Company. As of December 31, 2020, 100% of the Named Executive Officers and all of the other required employees who have served in their position for at least five years have met the stock ownership guidelines.
Internal Revenue Code Limits on Deductibility of Compensation
Section 162(m) of the Internal Revenue Code of 1986 places an annual limit of $1 million on the amount of compensation we can deduct as a business expense on our federal income tax return with respect to each “covered employee.” Statutory changes to Section 162(m) effective for compensation paid after December 31, 2017 significantly reduced the Company's ability to deduct compensation in excess of $1 million paid to each "covered employee."
"Covered Employees" Definition
Beginning in 2018, "covered employees" for purposes of Section 162(m) are our CEO, our CFO and the three highest paid executive officers named in the "Summary Compensation Table" on page 53 other than the CEO and CFO. In addition, once an individual becomes a covered employee for any taxable year beginning after December 31, 2016, that individual will remain a covered employee for all future years, including after termination of employment or even death. This change expands the group of "covered employees" whose compensation will be subject to the Section 162(m) deduction limit. As a result, post-termination and post-death payments, severance, deferred compensation and payments from nonqualified plans paid to an executive who was a "covered employee" at any time after 2016 will be subject to the Section 162(m) deduction limit; a limited exception remains for compensation paid under binding written agreements in effect on November 2, 2017 that meet certain requirements.
For the 2020 tax year, the Company paid the Named Executive Officers and other current or former executives treated as "covered employees" under Section 162(m) a total of $34.1 million which was not deductible.
The O&C Committee continues to believe that tying the Named Executive Officers' compensation to the Company's performance is in the best interest of the Company and its shareholders. As a result, the O&C Committee does not expect these changes to Section 162(m) to significantly affect the design of the Company's compensation program, and expects to authorize compensation exceeding $1 million to the Named Executive Officers even though it will not be deductible under Section 162(m).
In addition, the Company will no longer request shareholder approval that was required solely to satisfy
Section 162(m) requirements, but will continue to seek shareholder approval of compensation plans as required by other applicable law or regulation.
Nonqualified Deferred Compensation Programs
We have structured all of our nonqualified deferred compensation programs to comply with Internal Revenue Code Section 409A, as added by the American Jobs Creation Act of 2004. Internal Revenue Code Section 409A imposes additional tax penalties on our executive officers for certain types of nonqualified deferred compensation that are not in compliance with the form and timing of elections and distribution requirements of that section.
Accounting Considerations
Accounting considerations also play a role in our executive compensation program. Financial Accounting Standards Board Accounting Standards Codification Topic 718 (“ASC Topic 718”) requires us to expense the fair value of our stock option


DTE ENERGY 2021 PROXY STATEMENT 51


grants over the vesting period, which reduces the amount of our reported profits. Because of this stock-based expensing and the impact of dilution to our shareholders, we closely monitor the number and the fair values of the option shares.
Report of the Organization and Compensation Committee
The O&C Committee has reviewed and discussed with management the Compensation Discussion and Analysis required by Item 402(b) of Regulation S-K. Based on that review and discussion, we recommended to the Board that the Compensation Discussion and Analysis be included in the Company’s 2021 proxy statement.
Organization and Compensation Committee
David A. Brandon, Chair
Gail J. McGovern
Ruth G. Shaw
Robert C. Skaggs, Jr.

52 DTE ENERGY 2021 PROXY STATEMENT


Summary Compensation Table
The table below summarizes the total compensation earned by each of the Named Executive Officers for the fiscal years ended December 31, 2018, December 31, 2019 and December 31, 2020.
Name and
Principal Position
YearSalary
($)(4)
Stock
Awards
($)(5)
Non-Equity
Incentive
Plan
Compensation
($)(6)
Change in Pension
Value and
Nonqualified
Deferred
Compensation
Earnings
($)(7)(8)
All Other
Compensation
($)(9)
Total
($)
Gerardo Norcia,20201,192,500 5,614,868 2,808,216 892,005 98,033 10,605,622