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Income Taxes | 12 Months Ended
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Dec. 31, 2024
Income Tax Disclosure [Abstract] |
Income Taxes | INCOME TAXES Income Tax Summary DTE Energy files a consolidated federal income tax return. DTE Electric is a part of the consolidated federal income tax return of DTE Energy. DTE Energy and its subsidiaries file consolidated and/or separate company income tax returns in various states and localities, including a consolidated return in the State of Michigan. DTE Electric is part of the Michigan consolidated income tax return of DTE Energy. The federal, state and local income tax expense for DTE Electric is determined on an individual company basis with no allocation of tax expenses or benefits from other affiliates of DTE Energy. DTE Electric had federal income tax receivables with DTE Energy of $5 million and $7 million at December 31, 2024 and 2023, respectively. Income tax receivables with DTE Energy are included in Accounts receivable – Affiliates on the DTE Electric Consolidated Statements of Financial Position. The Registrants' total Income Tax Expense varied from the statutory federal income tax rate for the following reasons:
| 2024 |  | 2023 |  | 2022
DTE Energy | (In millions)
Income Before Income Taxes | $ | 1,370 |  |  | $ | 1,566 |  |  | $ | 1,112 |
Income tax expense at 21% statutory rate | $ | 288 |  |  | $ | 329 |  |  | $ | 234 |
Production tax credits(a)(b) | (169) |  |  | (91) |  |  | (91) |
Investment tax credits(a) | (128) |  |  | (44) |  |  | (1) |
TCJA regulatory liability amortization | (66) |  |  | (63) |  |  | (155) |
AFUDC equity | (17) |  |  | (7) |  |  | (5) |
State and local income taxes, net of federal benefit | 59 |  |  | 59 |  |  | 42 |
Other, net | (1) |  |  | (14) |  |  | 5 |
Income Tax Expense (Benefit) | $ | (34) |  |  | $ | 169 |  |  | $ | 29 |
Effective income tax rate | (2.5) | % |  | 10.8 | % |  | 2.6 | %
_______________________________________ (a)PTCs and ITCs include $231 million of certain eligible credits generated in 2023 and 2024, net of discount, that were sold in 2024 under the transferability provisions of the Inflation Reduction Act of 2022. Cash received related to the transfer of tax credits is included in Cash paid (received) for: Income taxes within the supplemental disclosures of cash flow information on the DTE Energy Consolidated Statements of Cash Flows. These tax credit sales are subject to standard indemnifications up to the cash received. Payments under these indemnifications are considered remote. (b)Includes nuclear PTCs of $89 million, net of discount, recognized in 2024. The nuclear PTCs continue to be the subject of additional guidance expected to be issued from the U.S. Department of the Treasury and IRS that may materially impact the total amount of the benefits we receive. The benefit of these PTCs is provided to customers through the regulatory construct of the PSCR mechanism.
| 2024 |  | 2023 |  | 2022
DTE Electric | (In millions)
Income Before Income Taxes | $ | 1,040 |  |  | $ | 850 |  |  | $ | 981 |
Income tax expense at 21% statutory rate | $ | 218 |  |  | $ | 179 |  |  | $ | 206 |
Production tax credits(a)(b) | (162) |  |  | (79) |  |  | (83) |
Investment tax credits(a) | (70) |  |  | (1) |  |  | (1) |
TCJA regulatory liability amortization | (55) |  |  | (53) |  |  | (145) |
AFUDC equity | (16) |  |  | (7) |  |  | (4) |
State and local income taxes, net of federal benefit | 57 |  |  | 45 |  |  | 56 |
Other, net | (4) |  |  | (6) |  |  | (3) |
Income Tax Expense (Benefit) | $ | (32) |  |  | $ | 78 |  |  | $ | 26 |
Effective income tax rate | (3.1) | % |  | 9.2 | % |  | 2.7 | %
_______________________________________ (a)PTCs and ITCs include $231 million of certain eligible credits generated in 2023 and 2024, net of discount, that were sold in 2024 under the transferability provisions of the Inflation Reduction Act of 2022. Cash received related to the transfer of tax credits is included in Cash paid (received) for: Income taxes within the supplemental disclosures of cash flow information on the DTE Energy Consolidated Statements of Cash Flows. These tax credit sales are subject to standard indemnifications up to the cash received. Payments under these indemnifications are considered remote. (b)Includes nuclear PTCs of $89 million, net of discount, recognized in 2024. The nuclear PTCs continue to be the subject of additional guidance expected to be issued from the U.S. Department of the Treasury and IRS that may materially impact the total amount of the benefits we receive. The benefit of these PTCs is provided to customers through the regulatory construct of the PSCR mechanism. Components of the Registrants' Income Tax Expense were as follows:
| 2024 |  | 2023 |  | 2022
DTE Energy | (In millions)
Current income tax benefit |  |  |  |  |
Federal | $ | (226) |  |  | $ | (10) |  |  | $ | (13) |
State and other income tax | (2) |  |  | (2) |  |  | (2) |
Total current income taxes | (228) |  |  | (12) |  |  | (15) |
Deferred income tax expense (benefit) |  |  |  |  |
Federal | 117 |  |  | 103 |  |  | (13) |
State and other income tax | 77 |  |  | 78 |  |  | 57 |
Total deferred income taxes | 194 |  |  | 181 |  |  | 44 |
| $ | (34) |  |  | $ | 169 |  |  | $ | 29 |
| 2024 |  | 2023 |  | 2022
DTE Electric | (In millions)
Current income tax expense (benefit) |  |  |  |  |
Federal | $ | (228) |  |  | $ | 1 |  |  | $ | 1 |
State and other income tax | — |  |  | (5) |  |  | — |
Total current income taxes | (228) |  |  | (4) |  |  | 1 |
Deferred income tax expense (benefit) |  |  |  |  |
Federal | 124 |  |  | 19 |  |  | (46) |
State and other income tax | 72 |  |  | 63 |  |  | 71 |
Total deferred income taxes | 196 |  |  | 82 |  |  | 25 |
| $ | (32) |  |  | $ | 78 |  |  | $ | 26 |
Deferred tax assets and liabilities are recognized for the estimated future tax effect of temporary differences between the tax basis of assets or liabilities and the reported amounts in the Registrants' Consolidated Financial Statements. The Registrants' deferred tax assets (liabilities) were comprised of the following at December 31:
| DTE Energy |  | DTE Electric
| 2024 |  | 2023 |  | 2024 |  | 2023
| (In millions)
Property, plant, and equipment | $ | (3,695) |  |  | $ | (3,423) |  |  | $ | (2,788) |  |  | $ | (2,693) |
Regulatory assets and liabilities | (1,272) |  |  | (1,158) |  |  | (1,492) |  |  | (1,314) |
Tax credit carryforwards | 1,604 |  |  | 1,519 |  |  | 583 |  |  | 572 |
Pension and benefits | 55 |  |  | 77 |  |  | 62 |  |  | 69 |
Federal net operating loss carryforward | 190 |  |  | 202 |  |  | 30 |  |  | 71 |
State and local net operating loss carryforwards | 68 |  |  | 76 |  |  | 42 |  |  | 49 |
Investments in equity method investees | (28) |  |  | (33) |  |  | (1) |  |  | — |
Other | 145 |  |  | 130 |  |  | 176 |  |  | 137 |
| (2,933) |  |  | (2,610) |  |  | (3,388) |  |  | (3,109) |
Less: Valuation allowance | (25) |  |  | (39) |  |  | (5) |  |  | — |
Long-term deferred income tax liabilities | $ | (2,958) |  |  | $ | (2,649) |  |  | $ | (3,393) |  |  | $ | (3,109) |
Deferred income tax assets | $ | 2,508 |  |  | $ | 2,415 |  |  | $ | 1,209 |  |  | $ | 1,202 |
Deferred income tax liabilities | (5,466) |  |  | (5,064) |  |  | (4,602) |  |  | (4,311) |
| $ | (2,958) |  |  | $ | (2,649) |  |  | $ | (3,393) |  |  | $ | (3,109) |
Tax credit carryforwards for DTE Energy include $1.6 billion of general business credits that expire from 2032 through 2046. No valuation allowance is required for the tax credit carryforwards deferred tax asset. DTE Energy has a pre-tax federal net operating loss carryforward of $904 million as of December 31, 2024 which can be carried forward indefinitely. No valuation allowance is required for the federal net operating loss deferred tax asset. DTE Energy has state and local deferred tax assets related to net operating loss carryforwards of $68 million and $76 million at December 31, 2024 and 2023, respectively. Most of the state and local net operating loss carryforwards expire from 2025 through 2046 with the remainder being carried forward indefinitely. DTE Energy has recorded valuation allowances of $25 million and $39 million at December 31, 2024 and 2023, respectively. The valuation allowances include $16 million and $19 million related to the state net operating loss carryforwards noted above and $3 million and $20 million related to charitable contribution carryforwards as of the respective periods ended. Tax credit carryforwards for DTE Electric include $583 million of general business credits that expire from 2036 through 2046. No valuation allowance is required for the tax credit carryforwards deferred tax asset. DTE Electric has a pre-tax federal net operating loss carryforward of $142 million as of December 31, 2024 which can be carried forward indefinitely. No valuation allowance is required for the federal net operating loss deferred tax asset. DTE Electric has $42 million and $49 million in state and local deferred tax assets related to net operating loss carryforwards at December 31, 2024 and 2023, respectively, which will expire from 2030 through 2042. No valuation allowance is required for the state and local net operating loss deferred tax assets. In assessing the realizability of deferred tax assets, DTE Energy considers whether it is more likely than not that some portion or all of the deferred tax assets will not be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income during the periods in which those temporary differences become deductible. The above tables exclude unamortized ITCs that are shown separately on the Registrants' Consolidated Statements of Financial Position. DTE Energy's policy election is to follow the flow-through method of accounting for ITCs earned from its non-utility businesses and the deferral method of accounting for its regulated utilities due to different economic profiles of the various entities. The flow-through method used by the non-utility businesses recognizes ITCs in earnings when the related assets are placed in service. The ITCs generated by the regulated utilities are deferred and amortized to earnings over the average life of the related property. ITCs generated and sold by the regulated utilities are offset with a regulatory asset to give the benefit to customers over a period shorter than the book life, as approved by the MPSC. Refer to Note 8 to the Consolidated Financial Statements, "Regulatory Matters" for the regulatory asset balance at December 31, 2024. Uncertain Tax Positions There were no unrecognized tax benefits at the Registrants for the years ended December 31, 2024 or 2023. The Registrants recognize interest and penalties pertaining to income taxes in Interest expense and Other expenses, respectively, on the Consolidated Statements of Operations. DTE Energy did not recognize any interest expense related to income taxes in 2024 and recognized a nominal amount of interest expense related to income taxes in 2023 and 2022. DTE Electric did not recognize any interest expense related to income taxes in 2024 and recognized a nominal amount of interest expense in 2023 and $1 million in 2022. There was no accrued interest or penalties pertaining to income taxes for the Registrants at December 31, 2024 and 2023. Accrued interest pertaining to income taxes at December 31, 2022 was $5 million and $8 million for DTE Energy and DTE Electric, respectively. There were no accrued penalties pertaining to income taxes for the Registrants at December 31, 2022. In 2024, DTE Energy, including DTE Electric, settled a federal tax audit for the 2022 tax year. DTE Energy's federal income tax returns for 2023 and subsequent years remain subject to examination by the IRS. DTE Energy's Michigan Corporate Income Tax returns for the year 2019 and subsequent years remain subject to examination by the State of Michigan. DTE Energy also files tax returns in numerous state and local jurisdictions with varying statutes of limitation.

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