DTE Energy Co. - 4.375% DB REDEEM 01/12/2081 USD 25

Strong 1Q 2026 results; confidence in high-end EPS - Operating EPS: $1.95/share on $407M operating earnings for 1Q’26 (company expects to hit the high end of 2026 guidance). - Segment performance (Operating earnings): - DTE Electric: $218M, +$71M YoY (drivers: tax timing, rate implementation, colder weather; partly offset by higher rate base and O&M). - DTE Gas: $210M, +$4M YoY (colder weather + IRM revenue; partly offset by higher rate base costs). - DTE Vantage: $48M, +$9M YoY (higher custom energy + steel; partly offset by lower renewables). - Energy Trading: $59M lower YoY (timing in 1Q’26 vs 1Q’25), but management is confident timing reverses later in 2026. - 2026 guidance framing: Operating EPS expected to grow 6%–8% vs 2025 midpoint, with RNG tax credits supporting the upper end.

Reliability execution & storm response: real operational progress - Management emphasized operational performance including restoring 100% of impacted customers within 48 hours after a January event, and >99% within 48 hours after a March storm. - Reliability metrics improvement: from 2023–2025, outage duration improved ~90%, and best all-weather SAIDI in ~20 years; 99.9% of impacted customers restored within 48 hours in 2025. - Strategy/targets: continuing distribution modernization (smart grid devices, pole-top maintenance, 4.8kV rebuild) with long-term goals to reduce outage frequency by 30% and cut outage duration in half by 2029. - Investor-relevant positive: management strongly tied reliability gains to continued capex + process improvements (“when we invest, it works”).

Data center growth is the big upside engine—Oracle approved, Google advancing; affordability is the central thesis - Oracle (1.4 GW): approved; construction underway; load ramp over coming years. Management says Oracle should drive about ~$300M annual benefits to existing customers once fully ramped. - Google (1.0 GW): agreement filed for MPSC approval; management expects an order in September timeframe (they cited “no PFD” expected). - Full ramp expected by end of 2028. - Google is expected to generate about ~$1.7B benefits over the life of the contract (affordability impacts). - Incremental generation/storage investment: meeting Google capacity needs could drive roughly ~$5B of incremental generation and storage investment through 2032. - Pipeline opportunity: additional hyperscaler/colocator discussions in late stage—~2 GW incremental load, plus another 3–4 GW over time (management sees further upside). - Surprising/important nuance: contracts are structured to ensure data centers cover the full energy and capacity cost needed, with safeguards (including termination provisions + credit/collateral) to protect affordability for existing customers.