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                                                                EXHIBIT 10.12




                     KEY EMPLOYE DEFERRED COMPENSATION PLAN

                                 January, 1990


         The Key Employe Deferred Compensation Plan ("Plan"), initiated in
1964, is designed to supplement pension benefits available to certain
management employees under the Employes' Retirement Plan.  Basic Awards may be
made to eligible individuals effective each December 31.

ADMINISTRATION

         The Organization and Compensation Committee ("Committee") of the Board
of Directors administers the Plan and is responsible for all future awards
hereunder without further action by the Board of Directors.  The Committee has
the authority to interpret the Plan's provisions and prescribe any regulations
relating to its administration.

ELIGIBILITY

         Participation (subject to award eligibility requirements) in the Plan
is restricted to the following employes:

                                  Frank E. Agosti
                                  Stanley G. Catola
                                  Malcolm G. Dade, Jr.
                                  Ronald W. Gresens
                                  Willard R. Holland
                                  Wesley D. Kappler
                                  Sheldon M. Lutz
                                  Robert V. Nicolson
                                  William S. Orser
                                  Frederick L. Petersen
                                  J. James Roosen
                                  Mahmud U. Syed
                                  B. Ralph Sylvia
                                  S. Martin Taylor
                                  James H. Tuttle
                                  Maurice L. Vermeulen
                                  Richard C. Viinikainen
                                  Saul J. Waldman
                                  Morley A. Wassermann

         Participants must be age 50 or older to be eligible to receive basic
awards.

CALCULATION OF BASIC AWARD AMOUNTS

         For Plan years beginning 1989, participants will receive basic awards
of one percent (1%) of the total base salary paid or accrued during full months
for which the eligibility criteria have been met; provided, however, that in
the event the Committee certifies to the Paymaster a different award (or no
award) by December 31, then such certified amount shall prevail.





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For example, assume an individual earns $10,000 per month and reaches age 50 on
July 1. The award amount would be calculated for such year as follows:

                         .01 X $10,000 X 6 = $600.00

CALCULATION OF SUPPLEMENTAL AWARD AMOUNTS

         In addition to the Basic Awards, Supplemental Awards are calculated
and paid monthly at the same time as Basic Awards are paid.  The amount of each
Supplemental Award is the sum of: (A) 1/12 of the balance of total unpaid Basic
Awards granted prior to 1981 times the average prime interest rate of the
National Bank of Detroit for the preceding month less 1%, PLUS (B) 1/12 of the
balance of total unpaid Basic Awards granted after 1980 times the lesser of (i)
the average prime interest rate of the National Bank of Detroit for the
preceding month less 1%, or (ii) 10%.

         For example, assume an individual terminates employment on January 1,
1993 and has received Basic Awards as follows:


<TABLE>
                          <S>                          <C>
                          1978                          $500
                          1979                           600
                          1980                           700
                          1981                           800
                          1982                           900
                          1983                         1,000
                          1984                         1,100
                          1985                         1,200
                          1986                         1,300
                          1987                         1,400
                          1988                         1,500
                          1989                         1,600
                          1990                         1,700
                          1991                         1,800
                          1992                         1,900
</TABLE>

         Total annual Basic Awards are $18,000 per year and total unpaid Basic
Awards are $18,000 x 15 = $270,000.

         Assume that the average prime interest rate for December 1992 is 13%.
The Basic Award for January 1993 would be $18,000 12 = $1,500 and the
Supplemental Award for January 1993 would be $27,000 x 12%   12 = $270 plus
$243,000 x 10%   12 = $2,025, for a total Supplemental Award of $2,295.  The
total award for the first month would therefore be $1,500 + $2,295 = $3,795.

         Assume that the average prime interest rate for January 1993 was 10%.
The Basic Award for February 1993 would be $1,500 and the Supplemental Award
would be ($27,000 - $150) x 9%   12 = $201.38 plus ($243,000 - $1,350) x 9%
12 = $1,812.38, for a total Supplemental Award of $2,013.76.  The total award
would therefore be $1,500 + $2,013.76 = $3,513.76.


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AWARDS

         Awards under this Plan are not considered earnings for purposes of the
Employe Savings Plan, the Employes' Retirement Plan, insurance or other employe
benefit programs including, but not limited to, the Executive Incentive Plan.


         Note, however, that under certain circumstances awards granted after
January 1, 1984 may be subject to the Federal Insurance Contributions Act
("F.I.C.A.") tax.

         The amount of Basic Award grants is prorated for individuals who have
met the eligibility criteria during a given year but whose employment is
terminated for any reason during such year.

PAYMENT OF AWARDS

         Basic Awards are paid to participants in monthly installments for a
period of 15 years after termination of employment, commencing in the first
full month after termination. In other words, if an individual's 1984 Deferred
Compensation Plan award were $1,000 then that individual would be entitled to
receive $83.33 per month ($1,000 per year) for a period of 15 years following
termination of employment.  Supplemental Awards are calculated, added to and
paid at the same time as Basic Awards.

         If a participant should die prior to receipt of the full amount of all
awards, the remaining balance of unpaid Basic Awards plus Supplemental Awards
are paid to the participant's designated beneficiary or estate on the same
monthly basis as if paid to the participant.  At the election of the
participant, payments to a designated beneficiary may be made monthly over a
shorter period or in a lump sum.

AMENDMENT OR TERMINATION

         The Company reserves the right to amend, modify, supplement or
terminate the Plan at any time, provided, however, that no such amendment,
modification, supplement or termination shall adversely affect the right of any
participant (or such participant's beneficiary) to receive benefits theretofore
accrued, without such person's prior written amount.  Notwithstanding the
foregoing, no amendment, modification, supplement or termination may be made
after the occurrence of a Change in Control, as defined in Addendum I, that
shall adversely affect the rights of any person who is receiving or upon
termination would thereupon be entitled to receive a benefit under the Plan,
without such person's prior written consent.  The foregoing does not preclude
voluntary waiver of benefits by a participant or beneficiary or a deemed waiver
of benefits by a participant pursuant to Addendum I.

CHANGE-IN-CONTROL BENEFIT FOR CERTAIN PERSONS

         Notwithstanding the foregoing provisions of the Plan, a participant
who has entered into a Change-in-Control Severance Agreement with DTE Energy
Company ("Change-in-Control Severance Agreement") shall receive a benefit as
provided in Addendum I to the Plan upon termination of employment in certain
circumstances following a Change in Control, as defined in Addendum I.   In
addition, any participant or beneficiary receiving a benefit under the Plan at
the time of the occurrence of a Change in Control, as defined in Addendum I,
shall receive payment as provided in Addendum I.  If a benefit is payable to a
participant or any beneficiary pursuant to Addendum I, neither the participant
or any beneficiary thereof, shall be entitled to any payments or further
payments, as the case may be, under the foregoing provisions of the Plan.



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                                   ADDENDUM I

                           CHANGE-IN-CONTROL BENEFITS

                 A change in control ("Change in Control") for purposes of the
Plan and this Addendum I shall have occurred if at any time on or after October
1, 1997 any of the following events shall occur:

         (1)     DTE Energy Company ("DTE") is merged, consolidated or
                 reorganized into or with another corporation or other legal
                 person, and as a result of such merger, consolidation or
                 reorganization less than 55% of the combined voting power of
                 the then-outstanding securities of such corporation or person
                 immediately after such transaction is held in the aggregate by
                 the holders of the then-outstanding securities entitled to
                 vote generally in the election of directors (the "Voting
                 Stock") of DTE immediately prior to such transaction;

         (2)     DTE sells or otherwise transfers all or substantially all of
                 its assets to another corporation or other legal person, and
                 as a result of such sale or transfer, less 55% of the combined
                 voting power of the then-outstanding Voting Stock of such
                 corporation or person immediately after such sale or transfer
                 is held in the aggregate (directly or through ownership of
                 Voting Stock of DTE or a Subsidiary (as hereinafter defined))
                 by the holders of Voting Stock of DTE immediately prior to
                 such sale or transfer;

         (3)     There is a report filed on Schedule 13D or Schedule 14D-1 (or
                 any successor schedule, form or report), each as promulgated
                 pursuant to the Securities Exchange Act of 1934, as amended
                 (the "Exchange Act"), disclosing that any person (as the term
                 "person" is used in Section 13(d)(3) or Section 14(d)(2) of
                 the Exchange Act) has become the beneficial owner (as the term
                 "beneficial owner" is defined under Rule 13d-3 or any
                 successor rule or regulation promulgated under the Exchange
                 Act) of securities representing 20% or more of the combined
                 voting power of the then-outstanding Voting Stock of DTE;

         (4)     If, during any period of two consecutive years, individuals
                 who at the beginning of any such period constitute the
                 directors of DTE cease for any reason to constitute at least a
                 majority thereof; provided, however, that for purposes of this
                 paragraph (4) each director who is first elected, or first
                 nominated for election, by DTE's stockholders, by a vote of at
                 least two-thirds of the directors of DTE (or a committee
                 thereof) then still in office who were directors of DTE at the
                 beginning of any such period will be deemed to have been a
                 director of DTE at the beginning of such period; or

         (5)     The approval of the shareholders of DTE of a complete
                 liquidation or dissolution of DTE.

                 Notwithstanding the foregoing provisions of paragraph (3)
                 above, unless otherwise determined in a specific case by
                 majority vote of the Board of Directors of DTE, a "Change in
                 Control" shall not be deemed to have



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                 occurred for purposes of paragraph (3) solely because (i) DTE,
                 (ii) an entity in which DTE directly or indirectly
                 beneficially owns 50% or more of the outstanding Voting Stock
                 (a "Subsidiary"), or (iii) any DTE-sponsored employee stock
                 ownership plan or any other employee benefit plan of DTE or
                 any Subsidiary either files or becomes obligated to file a
                 report or a proxy statement under or in response to Schedule
                 13D or Schedule 14D-1 (or any successor schedule, form or
                 report or item therein) under the Exchange Act disclosing
                 beneficial ownership by it of shares of Voting Stock, whether
                 in excess of 20% or otherwise.

                 In the event a Change in Control occurs, any participant or
beneficiary thereof who as of the date of the occurrence of the Change in
Control is receiving benefits under the Plan shall be paid in cash in a lump
sum an amount equal to the actuarial equivalent present value of the remaining
benefits, determined as of the date of payment, that are payable to or in
respect of such person under the Plan (including survivor benefits, if
applicable).

                 In the event a Change in Control occurs, any participant who
has entered into a Change-in-Control Severance Agreement and whose employment
is terminated after the occurrence of the Change in Control in circumstances
entitling the individual to severance compensation under Section 4 of the
Change-in-Control Severance Agreement shall be entitled to a cash lump sum
payment under the Plan; provided, however, that if the participant is eligible
for and would be entitled to a lump sum payment under the terms of the
Management Supplemental Benefit Plan ("MSBP") sponsored by The Detroit Edison
Company that is greater than the lump sum payment to which the participant
would be entitled under this Plan as determined in this Addendum I, then the
participant shall be deemed to have elected to participate in the MSBP and
waived his or her right to any benefit under this Plan including under this
Addendum I.  The amount of lump sum payment payable hereunder shall be equal to
the actuarial equivalent present value of the benefit that would otherwise be
payable to the participant under the Plan determined as otherwise provided in
the Plan but with the following modification:


                 (1)      For any Plan Year ending after the occurrence of the
                          Change in Control the participant's Basic Award under
                          "Calculation of Basic Award Amounts" shall be no less
                          than one percent (1%) of the participant's total base
                          salary paid or accrued during full months for which
                          the eligibility criteria have been met; provided,
                          however, that for a participant who has met the
                          eligibility criteria during the Plan year but whose
                          employment is terminated during such year, the amount
                          of Basic Award shall be credited at termination and
                          shall be equal to not less than one percent (1%) of
                          the participant's total base salary paid or accrued
                          during the full months prior to termination.

                 Upon the foregoing payment, no further benefits shall be
payable under the Plan to such participant or beneficiary thereof.  Payments
under this Addendum I shall be made within 30 days after the date on which the
Change in Control occurs or, if later, the date the participant terminates
employment.

                 For purposes of this Addendum I,

                 (a) Basic Awards are deemed to have been deposited in a 
                     phantom account.



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      (b)        Any participant or beneficiary receiving benefits
                 at the time of the Change in Control will receive a cash
                 lump sum equal to the balance of the phantom account.

      (c)        Any eligible participant terminated after a Change
                 in Control will receive a cash lump sum payment under the Plan
                 equal to the current   phantom account balance (15 times the
                 Basic Awards credited to the account plus the Basic Award
                 determined in paragraph (1) above).



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