<PAGE>   1
                                                                    EXHIBIT 3-4

________________________________________________________________________________


                                   BY-LAWS

                                      of

                          THE DETROIT EDISON COMPANY


                              __________________


                              As amended through
                              February 26, 1996

                              __________________






________________________________________________________________________________











<PAGE>   2
                                   BY-LAWS
                                      OF
                          THE DETROIT EDISON COMPANY

                                --------------

                                    INDEX

                                  ARTICLE I

SHAREHOLDERS                                                               PAGE
  Section  1.  Annual Meeting .............................................  1
  Section  2.  Special Meeting ............................................  1
  Section  3.  Notice of Meetings .........................................  1
  Section  4.  Quorum .....................................................  1
  Section  5.  Voting and Inspectors ......................................  2
  Section  6.  Record of Shareholders .....................................  2
  Section  7.  List of Shareholders .......................................  2

                                  ARTICLE II


BOARD OF DIRECTORS AND COMMITTEES
  Section  1.  Number, Time of Holding Office and Limitation on Age .......  2
  Section  2.  Vacancies ..................................................  3
  Section  3.  Meetings of the Board ......................................  3
  Section  4.  Quorum .....................................................  4
  Section  5.  Annual Meeting of Directors ................................  4
  Section  6.  Executive Committee ........................................  4
  Section  7.  Committees .................................................  4
  Section  8.  Participation in Meetings ..................................  4
  Section  9.  Compensation ...............................................  5

                                 ARTICLE III

OFFICERS
  Section  1.  Officers and Agents ........................................  5
  Section  2.  Term of Office .............................................  5
  Section  3.  Chairman of the Board ......................................  5
  Section  4.  President ..................................................  5
  Section  5.  Other Officers .............................................  6
  Section  6.  Compensation ...............................................  6

                                  ARTICLE IV

CAPITAL STOCK
  Section  1.  Certificates of Shares .....................................  6
  Section  2.  Transfer of Shares .........................................  6
  Section  3.  Lost or Destroyed Stock Certificates .......................  6


                                  ARTICLE V

CHECKS, NOTES, BONDS, DEBENTURES, ETC. ....................................  6


                                  ARTICLE VI

CORPORATE SEAL ............................................................  7

                                 ARTICLE VII

CONTROL SHARE ACQUISITIONS ................................................  7

                                 ARTICLE VIII


AMENDMENT OF BY-LAWS ......................................................  7
<PAGE>   3
                                   BY-LAWS

                                      OF

                          THE DETROIT EDISON COMPANY

                     AS AMENDED THROUGH FEBRUARY 26, 1996

                                  ARTICLE I

                                 SHAREHOLDERS

     SECTION 1.  ANNUAL MEETING.  The annual meeting of the shareholders of the
Company shall be held on the fourth Monday of April in each year (or if said
day be a legal holiday, then on the next succeeding day not a legal
holiday), at such time and at such place as may be fixed by the Board of
Directors and stated in the notice of meeting, for the purpose of electing
directors and transacting such other business as may properly be brought before
the meeting.

     SECTION 2.  SPECIAL MEETING.  Special meetings of the shareholders may
be held upon call of the Board of Directors or the Chairman of the Board or the
President or the  holders of record of a majority of the outstanding shares of
stock of the Company, at such time as may be fixed by the Board of Directors or
the Chairman of the Board or the President or such shareholders and stated in
the notice of meeting.  All such meetings shall be held at the office of the
Company in the City of Detroit unless some other place is specified in the
notice.

     SECTION 3.  NOTICE OF MEETINGS.  Written notice of the time, place and
purpose or purposes of every meeting of the shareholders, signed by the
Secretary or an Assistant Secretary, shall be given either personally or by
mail, within the time prescribed by law, to each shareholder of record entitled
to vote at such meeting and to any shareholder who, by reason of any action
proposed at such meeting, might be entitled to receive payment for such stock
if such action were taken.  If mailed, such notice is given when deposited in
the United States mail, with postage thereon prepaid, directed to the
shareholder at the address as it appears on the record of shareholders, or, if
the shareholder shall have filed with the Secretary of the Company a written
request that notices intended for such shareholder be mailed to some other
address, then directed to the address designated in such request.  Further
notice shall be given by mail, publication or otherwise, if and as required by
law.

     Notice of meeting need not be given to any shareholder who submits a signed
waiver of notice, in person or by proxy, whether before or after the meeting. 
The attendance of any shareholder at the meeting, in person or by proxy,
without protesting at the beginning of the meeting the lack of notice of such
meeting, shall constitute a waiver of notice by such shareholder.

     Notice of a special meeting shall also indicate that it is being issued by
or at the direction of the person or persons calling the meeting.

     SECTION 4.  QUORUM.  At every meeting of the shareholders, the holders of
record of a majority of the outstanding shares of stock of the Company, entitled
to vote at such meeting, whether present in person or represented by proxy,
shall constitute a quorum.  If at any meeting there shall be no quorum, the
holders of a majority of the outstanding shares of stock so present or
represented may adjourn the meeting from time to time, without notice other
than announcement at the meeting, until a quorum shall have been
<PAGE>   4
2                                                              ARTICLE I and II

obtained, when any business may be transacted which might have been transacted
at the meeting as first convened had there been a quorum.  When a quorum is
once present to organize a meeting, it is not broken by the subsequent
withdrawal of any shareholder.

     SECTION 5.  VOTING AND INSPECTORS.  Each holder of record of outstanding
shares of stock of the Company entitled to vote at a meeting of shareholders
shall be entitled to one vote for each share of stock standing in the
shareholder's name on the record of shareholders, and may so vote either in
person or by proxy appointed by instrument in writing executed by such holder
or by the shareholder's duly authorized attorney-in-fact.  No proxy shall be
valid after the expiration of eleven months from the date of its execution
unless the shareholder executing it shall have specified therein the length of
time it is to continue in force which shall be for some limited period.  The
authority of the holder of a proxy to act shall not be revoked by the
incompetence or death of the shareholder who executed the proxy unless, before
the authority is exercised, written notice of an adjudication of such
incompetence or of such death is received by the Secretary or an Assistant
Secretary.

    In advance of any meeting of shareholders, the Board of Directors may
appoint one or more inspectors for the meeting.  If inspectors are not so
appointed, the chairman of the meeting shall appoint such inspectors.  Before
entering upon the discharge of their duties, the inspectors shall take and
subscribe an oath faithfully to execute the duties of inspector at such meeting
with strict impartiality and according to the best of their ability, and shall
take charge of the polls and after balloting shall make a certificate of the
result of the vote taken. No officer or director of the Company or candidate
for office of director shall be appointed as an inspector.  At all elections of
directors the voting shall be by ballot and a plurality of the votes cast
thereat shall elect.

     SECTION 6.  RECORD OF SHAREHOLDERS.  For the purpose of determining the
shareholders entitled to notice of or to vote at any meeting of shareholders or
any adjournment thereof, or to express consent to or dissent from any proposal
without a meeting, or for the purpose of determining shareholders entitled to
receive payment of any dividend or the allotment of any rights, or for the
purpose of any other action, the Board of Directors may fix, in advance, a date
as the record date for any such determination of shareholders, which record
date shall not be less than ten days nor more than the maximum number of days
permitted by law before the date of the meeting, or the taking of any other
action.

     SECTION 7.  LIST OF SHAREHOLDERS.  A list of shareholders as of the record
date, certified by the Secretary or any Assistant Secretary or by a transfer
agent, shall be produced at any meeting of shareholders upon the request
thereat or prior thereto of any shareholder.  If the right to vote at any
meeting is challenged, the inspectors, or the person presiding at the meeting,
shall require such list of shareholders to be produced as evidence of the
right of the persons challenged to vote at such meeting, and all persons who
appear on such list to be shareholders entitled to vote thereat may vote at
such meeting.

                                  ARTICLE II


                      BOARD OF DIRECTORS AND COMMITTEES


     SECTION 1.  NUMBER, TIME OF HOLDING OFFICE AND LIMITATION ON AGE.  The
business and affairs of the Company shall be managed and controlled by a Board
of Directors.  The number of directors constituting the entire Board shall be
determined from time to time by resolution of the Board so long as the total
number of directors is not less than twelve nor more than eighteen; provided,
however, that the minimum and maximum number of directors may be increased or
decreased from time to time by vote of a majority of the entire Board; and,
further provided that no change in the number of directors shall serve to
shorten the term of office of any incumbent director.  Commencing with the
annual election of directors by the 
<PAGE>   5
ARTICLE II                                                                     3


shareholders in 1991, the directors shall be divided into three classes, as
nearly equal in number as possible, and the term of office of the first class
shall expire at the 1992 annual meeting of shareholders, the term of office of
the second class shall expire at the 1993 annual meeting of shareholders and
the term of office of the third class shall expire at the 1994 annual meeting
of shareholders, or, in each case, until their successors shall be duly elected
and qualified. At each annual meeting commencing in 1992, a number of directors
equal to the number of the class whose term expires at the time of the meeting
shall be elected to hold office until the third succeeding annual meeting of
shareholders.  In the event the holders of the Preferred Stock or the
Preference Stock are entitled to elect directors as provided in Article V,
Division I, subdivision (9) or Article V, Division II, subdivision (9) of the
Restated Articles of Incorporation of the Company, then the provisions of such
class of stock with respect to their rights shall apply and such directors
shall be elected for terms expiring at the next annual meeting of shareholders
and without regard to the classification of the remaining members of the Board
of Directors.

   Except as hereinafter provided, each director shall be a holder of
common stock of the Company at the time of initial election to the Board or
shall become a holder within thirty days after such election (to the extent of
at least one share, owned beneficially) and any director who thereafter ceases
to be such a holder, shall thereupon cease to be a director.  The Board shall
have the authority to waive the requirement to hold shares in individual
situations upon presentation of evidence that a nominee or director is unable
to hold shares for legal or religious reasons.

   NO PERSON WHO SHALL HAVE SERVED AS AN EMPLOYEE OF THE COMPANY SHALL BE
ELECTED A DIRECTOR AFTER RETIRING FROM EMPLOYMENT WITH THE COMPANY; PROVIDED,
HOWEVER, THAT IF SUCH PERSON WAS THE CHIEF EXECUTIVE OFFICER OF THE COMPANY AT
THE TIME OF SUCH RETIREMENT, SUCH PERSON SHALL BE ELIGIBLE FOR ELECTION AS A
DIRECTOR UNTIL ATTAINING AGE SEVENTY.  NO OTHER PERSON SHALL BE ELECTED A
DIRECTOR AFTER ATTAINING AGE SEVENTY; PROVIDED, HOWEVER, THE BOARD SHALL HAVE
THE AUTHORITY TO WAIVE THIS PROVISION FOR NO MORE THAN ONE THREE-YEAR TERM UPON
A DETERMINATION THAT CIRCUMSTANCES EXIST WHICH MAKE IT PRUDENT TO CONTINUE THE
SERVICE OF A DIRECTOR WHO POSSESSES SPECIAL AND UNIQUE EXPERTISE CLEARLY
BENEFICIAL TO THE COMPANY.

   SECTION 2.   VACANCIES.  Whenever any vacancy shall occur in the Board of
Directors by death, resignation, or any other cause, it shall be filled without
undue delay by a majority vote of the remaining members of the Board of
Directors, and the person who is to fill any such vacancy shall hold office for
the unexpired term of the director to whom such person succeeds, or for the
term fixed by the Board of Directors acting in compliance with Section 1 of
this Article II in case of a vacancy created by an increase in the number of
directors, and until a successor shall be elected and shall have qualified;
provided, however, that no vacancy need be filled if, after such vacancy shall
occur, the number of directors remaining on the Board shall be not less than a
majority of the entire Board including any vacancies.  During the existence of
any vacancy or vacancies, the surviving or remaining directors shall possess
and may exercise all the powers of the full Board of Directors, when action by
a larger number is not required by law.

   SECTION 3.   MEETINGS OF THE BOARD.  Regular meetings of the Board of
Directors shall be held at such times and at such places as may from time to
time be fixed by the Board of Directors.

   Special meetings of the Board of Directors may be called by the Chairman of
the Board or the President or, in the event of the incapacity of the Chairman
of the Board and the President, the Executive Committee by giving reasonable
notice of the time and place of such meetings or by obtaining written waivers
of notice, before or after the meeting, from each absent director.  All such
meetings shall be held at the office of the Company in the City of Detroit
unless some other place is specified in the notice.

   A notice, or waiver of notice, need not specify the purpose of the meeting.

   Special meetings of the Board of Directors may be held without notice or
waiver, provided the action taken at such meetings shall be ratified in writing
by such of the directors as may not have been present.

        
















<PAGE>   6
4

                                                                   ARTICLE II



        SECTION 4.  QUORUM.  A majority of the directors in office at the time
of a meeting of the Board, but not less than one-third of the Board including
any vacancies, shall constitute a quorum for the transaction of business, but
if at any meeting of the Board of Directors there shall be less than a quorum
present, a majority of the directors present may adjourn the meeting from time
to time without notice other than announcement at the meeting, until a quorum
shall have been obtained, when any business may be transacted which might have
been transacted at the meeting as first convened had there been a quorum.  The
acts of a majority of the directors present at any meeting at which there is a
quorum shall be the acts of the Board, unless otherwise provided by law, by the
Restated Articles of Incorporation or by the By-Laws.

        SECTION 5.  ANNUAL MEETING OF DIRECTORS. A meeting of the Board of
Directors, to be known as the directors' annual meeting, shall be held without
notice each year after the adjournment of the annual shareholders' meeting and
on the same day, and at such meeting the officers of the Company for the
ensuing year shall be elected.  If a quorum of the directors is not present on
the day appointed for the directors' annual meeting, the meeting shall be
adjourned to some convenient day.

        SECTION 6.  EXECUTIVE COMMITTEE.  The Board of Directors may, by
resolution or resolutions passed by a majority of the entire Board, designate
an Executive Committee to consist of the Chief Executive Officer and two or
more of the other directors, and alternates, and shall designate the Chairman
thereof.  The Executive Committee shall have and may exercise, when the Board
is not in session, all of the powers of the Board in the management of the
business and affairs of the Company, and shall have power to authorize the seal
of the Company to be affixed to all papers which may require it; but the
Executive Committee shall not have power to declare dividends, to change the
number of directors constituting the entire Board, to fill vacancies in the
Board, or to change the membership of, or to fill vacancies in, any committee,
or to fix the compensation of the directors or committee members, or to make or
amend By-Laws of the Company, or to submit matters for action by shareholders,
or to amend or repeal a resolution of the Board which by its terms may not be
changed by the Executive Committee.  The Board shall have the power at any time
to fill vacancies in, to change the membership of, or to dissolve, the
Executive Committee.  The Executive Committee may make rules for the conduct of
its business and may appoint such subcommittees and assistants as it shall from 
time to time deem necessary.  A majority of the members of the Executive
Committee shall constitute a quorum.  All action taken by the Executive
Committee shall be reported to the Board at its meeting next succeeding such
action.  The Secretary or an Assistant Secretary shall attend and act as
secretary of all meetings of the Executive Committee and keep the minutes
thereof.

        Meetings of the Executive Committee may be called by the Chairman of
the Board or the President or, in the event of the incapacity of the Chairman of
the Board and the President, by two or more members of the Executive Committee
by giving reasonable notice of the time and place of such meetings.  All such
meetings shall be held at the office of the Company in the City of Detroit
unless some other place is specified in the notice.

        SECTION 7.  COMMITTEES. The Board of Directors may, by resolution,
create a committee or committees of one or more directors, and alternates, to
consider and report upon or to carry out such matters (not excepted by the
foregoing section) as may be entrusted to them by the Board of Directors, and
shall designate the Chairman of each such committee.

        SECTION 8.  PARTICIPATION IN MEETINGS. One or more members of the Board
of Directors or any committee thereof may participate in any meeting of such
Board or such committee by means of a conference telephone or similar
communications equipment which enables all persons participating in such a
meeting to hear each other at the same time and participation in the manner so
described shall constitute presence in person at such meetings.
<PAGE>   7
                                                                             5


ARTICLE II AND III



  SECTION 9.   COMPENSATION.  Each director of the Company who is not a salaried
officer or employe of the Company may receive reasonable compensation for
services as a director, including a reasonable fee for attendance at meetings of
the Board and committees thereof, and attendance at the Company's request at
other meetings or similar activities related to the Company.


                                 ARTICLE III

                                   OFFICERS

  SECTION 1.  OFFICERS AND AGENTS.  The officers of the Company to be elected
by the Board of Directors, as soon as practicable after the election of
directors each year, shall be Chairman of the Board, the President, a Secretary
and a Treasurer.  The Board of Directors may also from time to time elect one or
more Vice Presidents, a Controller, a General Auditor, a General Counsel, and
such other officers and agents as it may deem proper.  The Chairman of the
Board and the President shall be chosen from among the directors.  The persons
holding the offices of Chairman of the Board or President may not also hold the
office of General Auditor.  The Board of Directors may, in its discretion,
leave vacant any office other than that of Chairman of the Board, President,
Secretary or Treasurer.

  SECTION 2.  TERM OF OFFICE.  The term of office of all officers shall be
until the next annual meeting of shareholders or until their respective
successors are chosen and qualified; but any officer or agent elected by the
Board of Directors may be removed by the Board at any time, with or without
cause.

  SECTION 3.  CHAIRMAN OF THE BOARD.  The Chairman of the Board shall be the
chief executive officer of the Company, shall preside at all meetings of the
Board of Directors and shareholders, at which the Chairman is present, and shall
make the annual report to the shareholders.  The Chairman shall have general
charge of the business and affairs of the Company subject to the control of
the Board of Directors, may execute in the name of the Company any authorized
corporate obligation or other instrument and shall perform such other functions
as may be prescribed by the Board from time to time.

  The Chairman of the Board shall manage or supervise the conduct of the
corporate finances and relations of the Company with its shareholders, with the
public and with regulatory authorities and in addition to the President, may
exercise all powers elsewhere in the By-Laws conferred upon the President.  The
Chairman may delegate from time to time to the President or to other officers,
employes or positions of the Company, such powers as the Chairman may specify
in writing, with such terms and conditions, if any, as the Chairman may set
forth.  A copy of each such delegation and of any revocation or change shall be
filed with the Secretary.

  SECTION 4.  PRESIDENT.  The President shall be the chief operating officer of
the Company, subject to the control of the Board of Directors and the Chairman
of the Board, shall have power to authorize the employment of such subordinate
employes as may, in the President's judgment, be advisable for the operations
of the Company, may execute in the name of the Company any authorized corporate
obligation or other instrument and shall perform all other acts incident to the
President's office or prescribed by the Board of Directors or the Chairman of
the Board, or authorized or required by law.  During the absence or disability
of the Chairman of the Board, the President shall assume the duties and
authority of the Chairman of the Board and shall be the chief executive officer
of the Company.


























<PAGE>   8
6

                                                          ARTICLE III, IV AND V



        SECTION 5.  OTHER OFFICERS. The other officers, agents and employes of
the Company shall each have such powers and perform such duties in the
management of the property and affairs of the Company, subject to the control
of the Board of Directors, as generally pertain to their respective offices, as
well as such powers and duties as from time to time may be prescribed by the
Board of Directors, by the Chairman of the Board or by the President.

        SECTION 6.  COMPENSATION.  The Board of Directors shall determine the
compensation to be paid to the Chairman of the Board, the President and each
Vice President above the level of Assistant Vice President.


                                  ARTICLE IV


                                CAPITAL STOCK


        SECTION 1.  CERTIFICATES OF SHARES. The interest of each shareholder
shall be evidenced by a certificate or certificates for shares of stock of the
Company in such form as the Board of Directors may from time to time prescribe. 
The certificates of stock shall be signed by the Chairman of the Board, the
President or a Vice President and by the Treasurer, an Assistant Treasurer, the
Secretary or an Assistant Secretary of the Company, shall be sealed with the
seal of the Company or a facsimile thereof, and shall be countersigned by a
transfer agent for the stock and registered by a registrar for such stock.  The
signatures of the officers and the transfer agent or the registrar upon such
certificates may be facsimiles, engraved or printed, subject to the provisions 
of applicable law.  In case any officer, transfer agent or registrar shall
cease to serve in that capacity after their facsimile signature has been placed
on a certificate, the certificates may be issued with the same effect as if the
officer, transfer agent or registrar were still in office.


        SECTION 2.  TRANSFER OF SHARES. Shares in the capital stock of the
Company shall be transferred on the books of the Company upon surrender and
cancellation of certificates for a like number of shares, with duly executed
power to transfer endorsed thereon or attached thereto.

        SECTION 3.  LOST OR DESTROYED STOCK CERTIFICATES. No certificate for
shares of stock of the Company shall be issued in place of any certificate
alleged to have been lost, stolen or destroyed, except upon production of such
evidence of the loss, theft or destruction, and upon indemnification of the
Company and its agents to such extent and in such manner as the Board of
Directors may from time to time prescribe.


                                  ARTICLE V


                    CHECKS, NOTES, BONDS, DEBENTURES, ETC.

        All checks and drafts on the Company's bank accounts and all bills of
exchange and promissory notes, and all acceptances, obligations and other
instruments for the payment of money, shall be signed by such
<PAGE>   9
                                                                            7


ARTICLE V, VI AND VII


officer or officers or agent or agents, either manually or by facsimile
signature or signatures, as shall be thereunto authorized from time to time by
the Board of Directors either generally or in specific instances; provided that
bonds, debentures and other evidences of indebtedness of the Company bearing
facsimile signatures of officers of the Company shall be issued only when
authenticated by a manual signature on behalf of a trustee or an authenticating
agent appointed by Board of Directors and in case any such officer of the
Company shall cease to be such after such officer's facsimile signature has 
been placed thereon, such bonds, debentures or other evidences of indebtedness
may be issued with the same effect as if such person were still in office.

                                  ARTICLE VI
                                      
                                CORPORATE SEAL
  
  The Board of Directors shall provide a suitable seal, containing the name of
the Company.

                                 ARTICLE VII

                          CONTROL SHARE ACQUISITIONS


  This Stacey, Bennett, and Randall Shareholder Equity Act (Chapter 7B of the
Michigan Business Corporation Act) shall not apply to any control share
acquisitions (as defined in such Act) of shares of the Company.

  This Article VII of the By-Laws may not be amended, altered or repealed with
respect to any control share acquisition of shares of the Company effected
pursuant to a tender offer or other transaction commenced prior to the date of
such amendment, alteration or repeal.


                                 ARTICLE VIII

                             AMENDMENT OF BY-LAWS

  Those provisions of these By-Laws providing for a classified Board of
Directors (currently the third, fourth and fifth sentences of the first
paragraph of Section 1 of Article II) and the provisions of this sentence may
be amended or repealed only by vote of the holders of a majority of shares of
Common Stock of the Company.  Except as provided in the immediately
preceding sentence, By-Laws of the Company may be amended, repealed or adopted
by vote of the holders of a majority of shares at the time entitled to vote in
the election of any directors or by vote of a majority of the directors in
office.