Short-Term Credit Arrangements and Borrowings

9 Months Ended

Sep. 30, 2023

Short-Term Credit Arrangements and Borrowings

SHORT-TERM CREDIT ARRANGEMENTS AND BORROWINGS

DTE Energy, DTE Electric, and DTE Gas have unsecured revolving credit agreements that can be used for general corporate borrowings, but are intended to provide liquidity support for each of the companies’ commercial paper programs. Borrowings under the revolvers are available at prevailing short-term interest rates. Letters of credit of up to $500 million may also be issued under the DTE Energy revolver. DTE Energy and DTE Electric also have other facilities to support letter of credit issuance and increase liquidity.

The unsecured revolving credit agreements require a total funded debt to capitalization ratio of no more than 0.70 to 1 for DTE Energy and 0.65 to 1 for DTE Electric and DTE Gas. In the agreements, "total funded debt" means all indebtedness of each respective company and their consolidated subsidiaries, including finance lease obligations, hedge agreements, and guarantees of third parties’ debt, but excluding contingent obligations, nonrecourse and junior subordinated debt, and certain equity-linked securities and, except for calculations at the end of the second quarter, certain DTE Gas short-term debt. "Capitalization" means the sum of (a) total funded debt plus (b) "consolidated net worth," which is equal to consolidated total equity of each respective company and their consolidated subsidiaries (excluding pension effects under certain FASB statements), as determined in accordance with accounting principles generally accepted in the United States of America. At September 30, 2023, the total funded debt to total capitalization ratios for DTE Energy, DTE Electric, and DTE Gas were 0.64 to 1, 0.54 to 1, and 0.46 to 1, respectively, and were in compliance with this financial covenant.

During May 2023, DTE Energy paid the amount outstanding and terminated its unsecured Canadian revolving credit facility. In June 2023, DTE Energy entered into a new $100 million uncommitted letter of credit facility, with availability to either DTE Energy or DTE Electric.

In July 2023, DTE Energy entered into an additional $50 million uncommitted letter of credit facility. DTE Energy has also amended the terms of several other letter of credit facilities during 2023, including capacities and maturity dates.

The availability under these facilities as of September 30, 2023 is shown in the following table:


	DTE Energy		DTE Electric		DTE Gas		Total
	(In millions)
Unsecured revolving credit facility, expiring October 2028	$	1,500	$	800	$	300	$	2,600
Unsecured letter of credit facility, expiring June 2024	175		—		—		175
Unsecured letter of credit facility, expiring February 2025	150		—		—		150
Unsecured letter of credit facility(a)	100		—		—		100
Unsecured letter of credit facility(b)	—		100		—		100
Unsecured letter of credit facility(a)	50		—		—		50

	1,975		900		300		3,175
Amounts outstanding at September 30, 2023

Commercial paper issuances	371		656		190		1,217

Letters of credit	144		23		—		167
	515		679		190		1,384
Net availability at September 30, 2023	$	1,460	$	221	$	110	$	1,791

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(a)Uncommitted letter of credit facility with automatic renewal provision and therefore no expiration.

(b)Uncommitted letter of credit facility with automatic renewal provision and therefore no expiration. DTE Energy may also utilize availability under this facility.

In conjunction with maintaining certain exchange-traded risk management positions, DTE Energy may be required to post collateral with a clearing agent. DTE Energy has a demand financing agreement with its clearing agent, which allows the right of setoff with posted collateral. At September 30, 2023, the capacity under the facility was $200 million. The amounts outstanding under demand financing agreements were $139 million and $166 million at September 30, 2023 and December 31, 2022, respectively, and were fully offset by posted collateral.