Company: DTK
Filing Date: 2025-02-13
Form Type: 10-K
Source: 0000936340-25-000065
Chunk: 126

Company: DTE ENERGY CO
Filing Date: 2025-02-13
Form: 10-K
Item: Item 7
Chunk 126
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 operating strategies and estimates of future cash flows, which require assessments of current and projected market conditions.  An impairment evaluation is based on an undiscounted cash flow analysis at the lowest level for which independent cash flows of long-lived assets can be identified from other groups of assets and liabilities.  Impairment may occur when the carrying value of the asset exceeds the future undiscounted cash flows.  When the undiscounted cash flow analysis indicates a long-lived asset is not recoverable, the amount of the impairment loss is determined by measuring the excess of the long-lived asset over its fair value.  An impairment would require the Registrants to reduce both the long-lived asset and current period earnings by the amount of the impairment, which would adversely impact their earnings.

Pension and Other Postretirement Costs

DTE Energy sponsors both funded and unfunded defined benefit pension plans and other postretirement benefit plans for eligible employees of the Registrants.  The measurement of the plan obligations and cost of providing benefits under these plans involve various factors, including numerous assumptions and accounting elections.  When determining the various assumptions that are required, DTE Energy considers historical information as well as future expectations.  The benefit costs are affected by, among other things, the actual rate of return on plan assets, the long-term expected return on plan assets, the discount rate applied to benefit obligations, the incidence of mortality, the expected remaining service period of plan participants, level of compensation and rate of compensation increases, employee age, length of service, the anticipated rate of increase of health care costs, benefit plan design changes, and the level of benefits provided to employees and retirees.  Pension and other postretirement benefit costs attributed to the segments are included with labor costs and ultimately allocated to projects within the segments, some of which are capitalized.

DTE Energy had pension credits of $18 million and $69 million in 2024 and 2023, respectively, and pension costs of $123 million in 2022.  Other postretirement benefit credits were $44 million in 2024, $38 million in 2023, and $66 million in 2022.  Pension and other postretirement benefit credits for 2024 were calculated based upon several actuarial assumptions, including an expected long-term rate of return on plan assets of 8.00% for the pension plans and 7.60% for the other postretirement benefit plans.  In developing the expected long-term rate of return assumptions, DTE Energy evaluated asset class