Projected Net Operating Income Schedule: C1 Total Electric and Jurisdictional Electric Witness: T. M. Uzenski Projected 12 Month Period Ending June 30, 2016 Page: 1 of 1 ($000) (a) (b) (c) Historical Projected Net Operating Net Operating Line Income Income No. Description 12/31/13 6/30/2016 1 Revenues 4,428,908 4,429,397 2 Operating Expenses 3 Fuel and Purchased Power 1,447,941 1,444,186 4 Operations and Maintenance Expenses 1,250,623 1,285,098 5 Depreciation and Amortization 545,286 648,202 6 Property & Other Taxes 256,511 288,729 7 State & Local Income Taxes 42,730 48,062 8 Federal Income Taxes 203,971 162,832 9 Total Operating Expenses 3,747,062 3,877,109 10 Operating Income 681,846 552,288 11 Operating Income Adjustments 12 AFUDC 21,460 35,730 13 Other (5,203) (3,956) 14 Net Other Income and Deductions 16,257 31,774 15 "Total Electric" Net Operating Income 698,103 584,062 16 "Jurisdictional Electric" Net Operating Income 687,840 584,062
DTE Electric Company Exhibit: A10 Adjusted Net Operating Income Schedule: C1.1 Total Electric Witness: T. M. Uzenski Projected 12 Month Period Ending June 30, 2016 Page: 1 of 1 ($000) (a) (b) (c) (d) (e) (f) (g) (h) (i) (j) (k) (l) Source Deprec Property State & Local Federal Line Exhibit Fuel & O&M / and & Other Income Income Other Adjusted No. Description A-10 Revenues Purch Pwr Fuel Handling Amort Taxes Taxes Taxes AFUDC Inc./(Ded.) NOI 1 Historical Year: 12 Months Ended 12/31/13 2 Adjusted Normalized 2013 Net Operating Income 4,428,908 1,447,941 1,250,623 545,286 256,511 42,730 203,971 21,460 (5,203) 698,103 3 Projection Adjustments 4 Revenues C3 489 30 161 298 5 Fuel and Purchased Power C4 (3,755) 231 1,233 2,291 6 O&M C5 34,475 (2,121) (11,324) (21,030) 7 Depreciation and Amortization C6 102,916 (6,332) (33,804) (62,780) 8 Property and Other Taxes C7 32,218 (1,982) (10,583) (19,653) 9 Federal Income Taxes C8 12,296 (12,296) 10 State & Local Income Taxes C9 & C10 15,341 (15,341) 11 AFUDC C11 14,270 14,270 12 Other C12 1,247 1,247 13 Income Tax Effect of Interest C13 202 1,079 (1,281) 14 Synchronization Adjustment C14 (37) (197) 234 15 Total Projection Adjustments 489 (3,755) 34,475 102,916 32,218 5,332 (41,139) 14,270 1,247 (114,041) 16 Total Electric Net Operating Income 4,429,397 1,444,186 1,285,098 648,202 288,729 48,062 162,832 35,730 (3,956) 584,062
Revenue Conversion Factor Schedule: C2 Projected 12 Month Period Ending June 30, 2016 Witness: M. A. Suchta Page: 1 of 1 (a) (b) (c) Revenue Conversion Line Factor No. Description Calculation 6/30/2016 1 Income Before Income Taxes 100.00 2 Michigan Business Tax: Income Tax Rate 5.82% 3 Composite Municipal Excise Tax Rate 0.33% 4 Total State and Local Tax Rates L2+L3 6.15% 5 Federal Income Tax Base L1 - (L4x100) 93.85 6 Federal Income Tax Rate 35.00% 7 Federal Income Tax L5 x L6 32.85 8 Income after Federal, Michigan and Municipal Taxes L5 - L7 61.00 9 Revenue Conversion Factor L1 / L8 1.6393
Electric Operating Revenue Schedule: C3 Projected 12 Month Period Ending June 30, 2016 Witness: T. M. Uzenski ($000) Page: 1 of 2 (a) (b) (c) (d) (e) Adj. Historical Test Line 12-Mo. End Projection 12-Mo. End No. Description 12/31/13 Adjustments 06/30/16 Reference 1 Electric Sales Revenue (440-449.1, 456.1) 4,315,585 17,238 4,332,823 Carried from Exh. A-10, Sch. C3, page 2, line 6 2 Sales for Resale (447) 47,470 (47,470) - 3 Other Operating Revenues (450-456) 68,422 2,261 70,683 Detailed below on Lines 9 thru 17 4 Other Revenue Adjustments: 5 R2 Special Purpose Facilities Rider 9,440 (32) 9,408 Witness Heiser A-13WPF1, Support Schedule 16 6 R9 Economic Development Credit (12,009) 12,009-7 PLD Wholesale Revenue Credit - 16,483 16,483 Witness Heiser A-13WPF1, Support Schedule 13 8 Total Electric Operating Revenue 4,428,908 489 4,429,397 9 Other Operating Revenues (450-456) 10 Late Payment Charges (450) 19,385-19,385 11 Misc Service Charges (451) 7,389 1,090 8,479 12 Sale of Water (453) 37-37 13 Electric Property Rental (454) 15,482 (1,998) 13,484 14 Interdept Rent/Shared Asset Rev (455) 23,489 3,883 27,372 15 Other Misc Rev (456) 2,640 (714) 1,926 16 Transmission of Others Elec (456.1) - - - 17 Total Misc Operating Revenue 68,422 2,261 70,683
Michigan Public Service Commission Case: U-17767 Electric Operating Revenue Schedule: C3 Projected 12 Month Period Ending June 30, 2016 Witness: T. M. Uzenski ($000) Page: 2 of 2 (a) (b) (c) Test Line 12-Mo. End No. Description 06/30/16 Reference 1 Total Electric Sales Revenue excluding PLD 4,515,299 2 Less: Nuclear Surcharge Revenue 37,146 3 Energy Optimization Surcharge Revenue 97,135 4 Renewable Program Surcharge Revenue 23,080 5 Low Income Energy Assistance Fund (LIEAF) Surcharge Revenue 25,115 6 Electric Sales Revenue excluding Surcharges 4,332,823 Line 1 less Lines 2 through 5 Source: Witness Heiser Workpaper A-13WPF1, Support Schedule 14, page 4, line 63
Calculation of Power Supply Expenses Schedule: C4 Witness: K. A. Holmes Page: 1 of 1 (a) (b) (c) Line No. Description Amount Source 1 Current PSCR Base including transmission at generation level (mills/kwh) 31.26 U-15768; Exh. A-10, Sch. C4 2 Loss Factor (mills/kwh) 1.068 U-15768; Exh. A-10, Sch. C4 3 Current PSCR Base including transmission at sales level (mills/kwh) 33.39 (Line 1 + Line 2) 4 5 DTE Electric Power Supply Projected Sales (MWh) 42,722,513 Exhibit A-12, Schedule E3 6 7 Transmission Expense $ 305,671,000 U-15768; Ex. A-10, C4.3 8 9 Base Transmission Expense at PSCR Sales Level (mills/kwh) 7.15 (Line 7 / Line 5) 10 11 Base Fuel & PP Expense at PSCR Sales Level (mills/kwh) 26.24 (Line 3 - Line 9) 12 13 Test Year Power Supply Costs (Less Transmission) 14 15 DTE Electric Power Supply Projected Sales (MWh) 42,722,513 Line 5 16 DTE Electric R10 & R3 MISO Pricing Option Projected Sales (MWh) 1,786,860 Exhibit A-14, Schedule F3 (R3 & R10 MISO option) 17 DTE Electric Retail Sales (less R10 & R3) (MWh) 40,935,653 18 19 DTE Electric Retail Power Supply Costs (less R10) $ 1,073,955,078 (Line 17 * Line 11) 20 R10 & R3 MISO Pricing Option Costs 63,540,742 (Line 16 * $35.56/MWh) 21 Voltge Level Service Adder 1,018,932 Exhibit A-14, Schedule F3 (R3 & R10 MISO option) 22 DTE Electric Total Power Supply Costs $ 1,138,514,752 23 24 R10 and R3 Transmission $ 12,784,624 25 PSCR Sales Transmission $ 292,886,376 26 Transmission Expense $ 305,671,000 27 28 Total Expense $ 1,444,185,752
Operation and Maintenance Expenses Schedule: C5 Summary Witness: T. M. Uzenski ($000) Page: 1 of 1 (a) (b) (c) (d) (e) (f) (g) (h) (i) (j) (k) (l) Projected Adjustments 1/1/13-1/1/14-1/1/15-1/1/16 - Exhibit 12/31/13 Adjusted 12/31/14 12/31/15 6/30/16 Total Line Source Historical Rate Case Normalization Historical Inflation Inflation Inflation Other Projected Projected No. Description A-10 Test Period Adjustments Adjustments Test Period Adjustment Adjustment Adjustment Adjustments Adjustments Test Period 1 Steam Power Generation C5.1 296,221 (175) - 296,046 5,921 4,530 2,145 12,856 25,451 321,498 2 Fuel Supply & MERC Fuel Handling C5.2 17,244 (5,950) - 11,295 226 173 82-481 11,775 3 Nuclear Power Generation C5.3 149,957 (24,412) - 125,545 2,511 1,921 910 5,957 11,298 136,844 4 Hydraulic Power Generation C5.4 9,572 - - 9,572 191 146 69-407 9,980 5 Other Power Generation C5.5 23,031 (6,341) - 16,690 334 255 121-710 17,400 6 Distribution C5.6 308,569 (11,480) - 297,089 5,942 4,545 2,153 (20,883) (8,242) 288,847 7 Customer Service and Marketing C5.7 175,993 (75,754) - 100,239 2,005 1,534 726 1,250 5,515 105,754 8 Uncollectible Accounts Expense C5.7 52,799 - - 52,799 - - - - - 52,799 9 Corporate Support C5.8 200,560 (17,055) (14,713) 168,792 3,016 2,307 1,093 (9,845) (3,429) 165,363 10 Pension and Benefits C5.9 176,744 (4,190) - 172,554 4,059 4,832 2,571 1,277 12,738 185,293 11 AMI & Smart Currents C5.13 - - - - - - - (14,153) (14,153) (14,153) 12 Acquisition 1 (March 2015) Dimitry - - - - - - - 2,600 2,600 2,600 13 Acquisition 2 (June 2015) Dimitry - - - - - - - 1,100 1,100 1,100 14 Total O&M Expense 1,410,692 (145,357) (14,713) 1,250,623 24,204 20,243 9,871 (19,842) 34,476 1,285,098
Operation and Maintenance Expenses Schedule: C5.1 Steam Power Generation Witness: F. D. Warren ($000) Page: 1 of 2 (a) (b) (c) (d) (e) (f) (g) (h) (i) (j) (k) (l) (m) Projected Adjustments 1/1/13 - Reclass Fuel 1/1/14-1/1/15-1/1/16-12/31/13 Supply & MERC Other Adjusted 12/31/14 12/31/15 6/30/16 Harbor Total Line Historical Test Fuel Handling Rate Case Historical Inflation Adj Inflation Adj Inflation Adj Beach Other Projected Projected No. Description Account Period 1/ 2/ Adjustments Test Period 4/ 4/ 4/ 5/ Adjustments Adjustments Test Period 1 Steam Power Generation sum (c) thru (e) sum (g) thru (k) (f) + (l) 2 Operation 3 Operation Supervision and Engineering 500 16,329 (697) - 15,632 313 239 113 (239) - 426 16,058 4 Fuel Handling 501 36,934 (15,532) - 21,402 428 327 155 - - 911 22,313 5 Steam Expenses 502 24,984 - - 24,984 500 382 181 (543) 16,464 6/ 16,984 41,967 6 Steam from Other Sources 503 - - - - - - - - - - - 7 (Less) Steam Transferred-Cr. 504 - - - - - - - - - - - 8 Electric Expenses 505 6,724 - - 6,724 134 103 49 (362) - (76) 6,648 9 Misc Steam Power Expenses 506 62,422 (13) - 62,409 1,248 955 452 (266) - 2,389 64,798 10 Rents 507 - - - - - - - - - - - 11 Allowances 509 175 - (175) 3/ (0) (0) (0) (0) - - (0) (0) 12 Total Operation Expense 147,567 (16,241) (175) 131,151 2,623 2,007 950 (1,410) 16,464 20,634 151,784 13 Maintenance 14 Maintenance Supervision and Engineering 510 1,131 (208) - 923 18 14 7 - - 39 962 15 Maintenance of Structures 511 16,360 - - 16,360 327 250 119 (263) - 433 16,793 16 Maintenance of Boilers 512 91,621 - - 91,621 1,832 1,402 664 (869) (250) 7/ 2,779 94,400 17 Maintenance of Electric Plant 513 23,880 - - 23,880 478 365 173 (144) - 872 24,752 18 Maintenance of Misc Steam Plant 514 32,906 (795) - 32,111 642 491 233 (672) - 694 32,805 19 Total Maintenance Expense 165,899 (1,003) - 164,895 3,298 2,523 1,195 (1,948) (250) 4,818 169,713 20 Less Fuel Supply & MERC Fuel Handling (17,244) 17,244 - - - - - - - - - 21 Total Steam Power Generation 296,221 - (175) 296,046 5,921 4,530 2,145 (3,358) 16,214 25,451 321,498 22 Account 1/1/14-1/1/15-1/1/16-23 1/ MPPA Credit included above 506 (3,531) 12/31/14 12/31/15 6/30/16 24 512 (5,873) 4/ Annual Inflation Rate 2.0% 1.5% 1.4% 25 (9,403) No. of Months in Period 12 12 6 26 Pro-rated Inflation Rate 2.0% 1.5% 0.7% 27 2/ Reclassify Fuel Supply and MERC Fuel Handling 28 sponsored by Witness Schoen on Exhibit A-10 C5.2 5/ Harbor Beach - retired in December 2013 29 6/ Environmental Costs (see Exh. A-10 C5.1 page 2) 30 3/ Eliminate Renewable Energy Program 7/ Trenton Channel 8 - to be retired in late 2014
Operation and Maintenance Expenses Schedule: C5.1 Environmental O&M Costs Witness: F. D. Warren ($000) Page: 2 of 2 (a) (b) (c) (d) (e) Projected Historical Test Period Line Test Period 7/1/15 - Projection No. Description 2013 6/30/16 Adjustment Note col. (c)- col. (b) 1 Equipment: 2 FGD Equipment (Flue Gas Desulfurization) 10,690 16,433 5,743 3 SCR Equipment (Selective Catalytic Reduction) 300 312 12 4 U2A Equipment (Urea to Ammonia) 1,100 1,143 43 5 Dry Sorbent Injection (DSI)/ACI - 909 909 6 Chemicals: 7 Limestone Chemical 1,253 2,439 1,186 1 8 Trona/DSI Chemical - 8,572 8,572 2 9 Total Environmental O&M Costs 13,343 29,807 16,464 1/ There is a pending request to recover limestone expense in the Company s 2015 PSCR plan, Case No. U-17680. The Company is making a corresponding request in this proceeding. If approved, the Company would reflect only the incremental amount in the applicable PSCR reconciliation. 2/ There is a pending request to recover trona expense through the PSCR in the Company s 2013 PSCR plan, Case No. U-17097. If approved, the request for approval of O&M expense associated with trona in this case is withdrawn.
Projected Operation and Maintenance Expenses Schedule: C5.2 Fuel Supply & Midwest Energy Resources Company (MERC) Witness: R. R. Schoen ($000) Page: 1 of 1 (a) (b) (c) (d) (e) (f) (g) (h) (i) (j) (k) Projected Adjustments 1/1/13-1/1/14-1/1/15-1/1/16-12/31/13 Rate Case Adjusted 12/31/14 12/31/15 6/30/16 Total Line Historical Adjustment Historical Inflation Adj Inflation Adj Inflation Adj Other Projected Projected No. Description Account Test Period 1/ Test Period 2/ 2/ 2/ Adjustments Adjustments Test Period (c) + (d) sum (f) thru (i) (e) + (j) 1 Fuel Supply 2 Operation Supervision and Engineering 500 697-697 14 11 5-30 727 3 Fuel Handling 501 5,491-5,491 110 84 40-234 5,725 4 Misc Steam Power Expenses 506 13-13 0 0 0-1 13 5 Maintenance Supervision and Engineering 510 208-208 4 3 2-9 217 6 Maintenance of Misc Steam Plant 514 795-795 16 12 6-34 829 7 Total Fuel Supply 7,204-7,204 144 110 52-307 7,510 8 MERC Fuel Handling 9 O&M 4,091-4,091 82 63 30-174 4,265 10 Depreciation 2,129 (2,129) - - - - - - - 11 Property Taxes 1,082 (1,082) - - - - - - - 12 Income Taxes 39 (39) - - - - - - - 13 Interest Expense 2,700 (2,700) - - - - - - - 14 Total MERC Fuel Handling 501 10,041 (5,950) 4,091 82 63 30-174 4,265 15 Total Fuel Supply & MERC Fuel Handling 17,244 (5,950) 11,295 226 173 82-481 11,775 16 1/1/14-1/1/15-1/1/16-17 12/31/14 12/31/15 6/30/16 18 1/ MERC fuel handling is reallocated to the proper line item 2/ Annual Inflation Rate 2.0% 1.5% 1.4% 19 classification within net operating income as shown on No. of Months in Period 12 12 6 20 Exhibit A-3 C11 sponsored by Witness Uzenski. Pro-rated Inflation Rate 2.0% 1.5% 0.7%
Projected Operation and Maintenance Expenses Schedule: C5.3 Nuclear Power Generation Witness: W. A. Colonnello ($000) Page: 1 of 2 (a) (b) (c) (d) (e) (f) (g) (h) (i) (j) (k) Projected Adjustments 1/1/13-1/1/14-1/1/15-1/1/16-12/31/13 Rate Case Adjusted 12/31/14 12/31/15 6/30/16 Other Total Line Historical Adjustments Historical Inflation Adj Inflation Adj Inflation Adj Adjustments Projected Projected No. Description Account Test Period 1/ Test Period 2/ 2/ 2/ 3/ Adjustments Test Period 1 Nuclear Power Generation (c) + (d) sum (f) thru (i) (e) + (j) 2 Operation 3 Operation Supervision and Engineering 517 14,918 (391) 14,527 291 222 105-618 15,145 4 Coolants and Water 519 3,294 (1,690) 1,604 32 25 12-68 1,672 5 Steam Expenses 520 14,746 (7,799) 6,947 139 106 50 1,184 1,480 8,427 6 Steam from Other Sources 521 - - - - - - - - - 7 (Less) Steam Transferred-Cr. 522 - - - - - - - - - 8 Electric Expenses 523 4,282-4,282 86 66 31-182 4,464 9 Misc Nuclear Power Expenses 524 55,157 (14,532) 40,625 813 622 294 1,221 2,949 43,574 10 Rents 525 - - - - - - - - - 11 Station Expense 562 14-14 0 0 0-1 14 12 Total Operation Expense 92,411 (24,412) 67,999 1,360 1,040 493 2,405 5,298 73,297 13 Maintenance 14 Maintenance Supervision and Engineering 528 11,944-11,944 239 183 87-508 12,452 15 Maintenance of Structures 529 16,088-16,088 322 246 117-684 16,772 16 Maintenance of Reactor Plant Equipment 530 21,209-21,209 424 324 154 3,552 4,454 25,663 17 Maintenance of Electric Plant 531 5,608-5,608 112 86 41-239 5,847 18 Maintenance of Misc Nuclear Plant 532 2,696-2,696 54 41 20-115 2,810 19 Maintenance of station equipment 570 2-2 0 0 0-0 2 20 Total Maintenance Expense 57,546-57,546 1,151 880 417 3,552 6,000 63,547 21 Total Operation and Maintenance Expense 149,957 (24,412) 125,545 2,511 1,921 910 5,957 11,298 136,844 22 1/1/14-1/1/15-1/1/16-23 12/31/14 12/31/15 6/30/16 24 1/ Eliminate O&M expenses recovered separately in 2/ Annual Inflation Rate 2.0% 1.5% 1.4% 25 Nuclear Surcharge No. of Months in Period 12 12 6 26 Account Amount Pro-rated Inflation Rate 2.0% 1.5% 0.7% 27 Site Security 517-520,524 (13,842) 28 Radiation Protection 524 (10,570) 3/ Other Projected Adjustments: Account Amount 29 (24,412) Nuclear Fuel Offload 524 5,653 30 Expected Lawsuit Proceeds (95%) 524 (5,370) 31 Nuclear Fuel Offload, Net Adjustment 283 32 Outage Accrual Steam Expense 520 1,184 33 Outage Accrual Reactor Plant Maintenance 530 3,552 34 NRC Dues Increase 524 938 35 5,957
O&M Expense - Nuclear Generation Schedule: C5.3 Historical Test Year Witness: W. A. Colonnello ($000) Page: 2 of 2 (a) (b) Adjusted Historical Line 12 Months Ended No. Organization 12/31/13 1 Nuclear Organization 94,410 2 Regulatory Assessments and Dues 12,334 3 Nuclear Organization - Base 106,744 4 PO 13-01 - HPV Bearing 1,881 5 PO 13-02 - HPCV 718 6 PO 13-02 - Plant Cold 427 7 PO 13-02 - Generator Flushing 68 8 Emergent Projects 3,095 9 Refueling Outage 10 Refuel Outage - 11 Refuel Outage Accrual 15,707 12 Refuel Outage Reversal - 13 Total Refueling Outage 15,707 14 Total Nuclear Generation 125,545 15 FERC Account Summary 16 Operating FERC Accounts 67,999 17 Maintenance FERC Accounts 57,546 18 Total Nuclear FERC Accounts 125,545
Operation and Maintenance Expenses Schedule: C5.4 Hydraulic Power Generation Witness: F. D. Warren ($000) Page: 1 of 1 (a) (b) (c) (d) (e) (f) (g) (h) (i) (j) (k) Projected Adjustments 1/1/13-1/1/14-1/1/15-1/1/16-12/31/13 Adjusted 12/31/14 12/31/15 6/30/16 Total Line Historical Rate Case Historical Inflation Adj Inflation Adj Inflation Adj Other Projected Projected No. Description Account Test Period Adjustments Test Period 1/ 1/ 1/ Adjustments Adjustments Test Period 1 Hydraulic Power Generation (c) + (d) sum (f) thru (i) (e) + (j) 2 Operation 3 Operation Supervision and Engineering 535 1,469-1,469 29 22 11-63 1,532 4 Water for Power 536 - - - - - - - - - 5 Hydraulic Expenses 537 1,321-1,321 26 20 10-56 1,378 6 Electric Expenses 538 859-859 17 13 6-37 896 7 Misc Hydraulic Power Expenses 539 476-476 10 7 3-20 497 8 Rents 540 - - - - - - - - - 9 Total Operation Expense 4,126-4,126 83 63 30-176 4,302 10 Maintenance 11 Maintenance Supervision and Engineering 541 214-214 4 3 2-9 223 12 Maintenance of Structures 542 581-581 12 9 4-25 606 13 Maintenance of Reservoirs, Dams 543 1,058-1,058 21 16 8-45 1,103 14 Maintenance of Electric Plant 544 1,782-1,782 36 27 13-76 1,858 15 Maintenance of Misc Hydraulic Plant 545 1,811-1,811 36 28 13-77 1,889 16 Total Maintenance Expense 5,446-5,446 109 83 39-232 5,678 17 Total Hydraulic Power Generation 9,572-9,572 191 146 69-407 9,980 18 1/1/14-1/1/15-1/1/16-19 12/31/14 12/31/15 6/30/16 20 1/ Annual Inflation Rate 2.0% 1.5% 1.4% 21 No. of Months in Period 12 12 6 22 Pro-rated Inflation Rate 2.0% 1.5% 0.7%
Operation and Maintenance Expenses Schedule: C5.5 Other Power Generation Witness: F. D. Warren ($000) Page: 1 of 1 (a) (b) (c) (d) (e) (f) (g) (h) (i) (j) (k) Projected Adjustments 1/1/13-1/1/14-1/1/15-1/1/16-12/31/13 Rate Case Adjusted 12/31/14 12/31/15 6/30/16 Total Line Historical Adjustments Historical Inflation Adj Inflation Adj Inflation Adj Other Projected Projected No. Description Account Test Period 1/ Test Period 2/ 2/ 2/ Adjustments Adjustments Test Period 1 Other Power Generation (c) + (d) sum (f) thru (i) (e) + (j) 2 Operation 3 Operation Supervision and Engineering 546 - - - - - - - - - 4 Generation Expenses 548 69-69 1 1 1-3 72 5 Misc Other Power Expenses 549 1,466 (500) 967 19 15 7-41 1,008 6 Rents 550 - - - - - - - - - 7 Total Operation Expense 1,535 (500) 1,036 21 16 8-44 1,080 8 Maintenance 9 Maintenance Supervision and Engineering 551 - - - - - - - - - 10 Maintenance of Structures 552 - - - - - - - - - 11 Maintenance of Generating & Electric Plant 553 13,901 (5,842) 8,059 161 123 58-343 8,402 12 Maintenance of Misc Other Power Plant 554 - - - - - - - - - 13 Total Maintenance Expense 13,901 (5,842) 8,059 161 123 58-343 8,402 14 Power Supply Related Expenses 15 Operation Supervision and Engineering 556 7,595-7,595 152 116 55-323 7,918 16 Generation Expenses 557 - - - - - - - - - 17 Total Expense 7,595-7,595 152 116 55-323 7,918 18 Total Other Power Generation Expenses 23,031 (6,341) 16,690 334 255 121-710 17,400 19 1/ Eliminate Renewable Energy Program 20 21 1/1/14-1/1/15-1/1/16-22 12/31/14 12/31/15 6/30/16 23 2/ Annual Inflation Rate 2.0% 1.5% 1.4% 24 No. of Months in Period 12 12 6 25 Pro-rated Inflation Rate 2.0% 1.5% 0.7%
Projected Operation and Maintenance Expenses Schedule: C5.6 Distribution Expenses Witness: R. J. Pogats ($000) Page: 1 of 3 (a) (b) (c) (d) (e) (f) (g) (h) (i) (j) (k) (l) Projected Adjustments 1/1/13-1/1/14-1/1/15-1/1/16-12/31/13 Adjusted 12/31/14 12/31/15 6/30/16 Total Line Historical Rate Case Historical Inflation Adj Inflation Adj Inflation Adj Restoration Other Projected Projected No. Description Account Test Period Adjustment Test Period 2/ 2/ 2/ Adjustment Adjustments Adjustments Test Period 1 Distribution Expenses (c) + (d) sum (f) thru (j) (e) + (k) 2 Operation 3 Operation Supervision and Engineering 580 50,700-50,700 1,014 776 367 - - 2,157 52,857 4 Load Dispatching 581 2,693-2,693 54 41 20 - - 115 2,808 5 Station Expenses 582 9,993-9,993 200 153 72 - - 425 10,418 6 Overhead Line Expenses 583 8,237-8,237 165 126 60 - - 350 8,588 7 Underground Line Expenses 584 2,791-2,791 56 43 20 - - 119 2,910 8 Street Lighting and Signal System Exp 585 - - - - - - - - - - 9 Meter Expenses 586 14,216-14,216 284 218 103 - - 605 14,821 10 Customer Installations Expenses 587 895-895 18 14 6 - - 38 933 11 Miscellaneous Expenses 588 16,372-16,372 327 250 119 - - 697 17,068 12 Rents 589 11,482 (11,480) 1/ 2 0 0 0 - - 0 2 13 Total Operation Expense 117,379 (11,480) 105,899 2,118 1,620 767 - - 4,506 110,405 14 Maintenance 15 Maintenance Supervision and Engineerin 590 3,074-3,074 61 47 22 - - 131 3,204 16 Maintenance of Structures 591 3,044-3,044 61 47 22 - - 130 3,174 17 Maintenance of Station Equipment 592 21,258-21,258 425 325 154-2,000 4/ 2,904 24,162 18 Maintenance of Overhead Lines 593 140,749-140,749 2,815 2,153 1,020 (12,483) 3/ (10,400) 5/ (16,894) 123,855 19 Maintenance of Underground Lines 594 19,789-19,789 396 303 143 - - 842 20,631 20 Maintenance of Line Transformers 595 - - - - - - - - - - 21 Maintenance of Street Lighting and 596 3,276-3,276 66 50 24 - - 139 3,416 Signal Systems - - - 22 Maintenance of Meters 597 - - - - - - - - - - 23 Maintenance of Misc Distribution Plant 598 - - - - - - - - - - 24 Total Maintenance Expense 191,190-191,190 3,824 2,925 1,386 (12,483) (8,400) (12,748) 178,442 25 Total Operation and Maintenance Expense 308,569 (11,480) 297,089 5,942 4,545 2,153 (12,483) (8,400) (8,242) 288,847 26 1/ AT&T Pole Rental Net Adjustment (sponsored by Witness Uzenski) 27 2/ Inflation Adjustment: 1/1/14-1/1/15-1/1/16-28 12/31/14 12/31/15 6/30/16 29 Annual Rate 2.0% 1.5% 1.4% 30 No. of Months in Period 12 12 6 31 Pro-rated Inflation Rate 2.0% 1.5% 0.7% 32 3/ Restoration Adjustment (see Exhibit A-10 C5.6 page 2) 33 4/ Maintenance 34 5/ Line Clearance (see Exhibit A-10 C5.6 page 3)
Projected Operation and Maintenance Expenses Schedule: C5.6 Restoration Adjustment Witness: R. J. Pogats ($000) Page: 2 of 3 (a) (b) (c) (d) (e) (f) (g) (h) (i) 1/1/13-12/31/13 Line Actual Actual Actual Actual Forecast Historical Restoration No. Description 2010 2011 2012 2013 2014 5 Yr Avg Test Period Adjustment 1/ 1 Storm 62,214 86,065 49,866 82,623 105,555 77,265 82,623 2 Non-Storm Restoration 75,167 85,555 93,885 77,079 68,090 79,955 77,079 3 Total 137,381 171,620 143,751 159,703 173,645 157,220 159,703 (2,483) 4 Storm Capitalization Policy (10,000) 5 Total Restoration Adjustment (12,483) (g) - (h) 1/ Adjustment carried to column (i) of page 1
Projected Operation and Maintenance Expenses Schedule: C5.6 Vegetation Management Expenses Witness: R. J. Pogats ($000) Page: 3 of 3 (a) (b) (c) (d) (e) (f) (g) (h) Projected Adjustments 1/1/13-1/1/14-1/1/15-1/1/16-12/31/13 12/31/14 12/31/15 6/30/16 Other Total Line Historical Inflation Adj Inflation Adj Inflation Adj Adjustments Projected Projected No. Description Test Period 1/ 1/ 1/ 2/ Adjustments Test Period sum (c) thru (f) (b) + (g) 1 Vegetation Management Expenses 56,946 1,139 871 413 (10,400) (7,977) 48,969 2 1/ Inflation Adjustment: 1/1/14-1/1/15-1/1/16-3 12/31/14 12/31/15 6/30/16 4 Annual Rate 2.0% 1.5% 1.4% 5 No. of Months in Period 12 12 6 6 Pro-rated Inflation Rate 2.0% 1.5% 0.7% 7 2/ Other Projected Adjustments: 8 Hazardous Tree Removal 2,000 9 Modifications due to EVMP Method (12,400) 10 Total Adjustments (10,400) carried to column (j), line 18 of page1
Projected Operation and Maintenance Expenses Schedule: C5.7 Customer Service and Marketing Witness: R. M. Tomina ($000) Page: 1 of 1 (a) (b) (c) (d) (e) (f) (g) (h) (i) (j) (k) (l) (m) Projected Adjustments 1/1/13 - Rate Case Adjustments 1/1/14-1/1/15-1/1/16-12/31/13 Eliminate Eliminate Adjusted 12/31/14 12/31/15 6/30/16 Total Line Historical Energy Renewable Eliminate Historical Inflation Inflation Inflation Other Projected Projected No. Description Account Test Period Optimization Energy Prog. LIEAF Test Period 1/ 1/ 1/ Adjustments Adjustments Test Period 1 Customer Accounts Expenses sum (c) thru (f) sum (g) thru (k) (g) + (l) 2 Operation 3 Supervision 901 681 - - - 681 14 10 5-29 710 4 Meter Reading Expenses 902 10,511 - - - 10,511 210 161 76-447 10,958 5 Customer Records and Collection Expenses 903 63,709 - - - 63,709 1,274 975 462-2,711 66,420 6 Miscellaneous Customer Accounts Expense 905 30,274 (30,194) - - 79 2 1 1-3 83 7 Total Operation Expense 105,175 (30,194) - - 74,981 1,500 1,147 543-3,190 78,171 8 Customer Service and Informational Expenses 9 Operation 10 Supervision 907 3,866 (805) (412) - 2,650 53 41 19-113 2,762 11 Customer Assistance Expenses 908 60,539 (30,531) (3,368) (8,440) 18,199 364 278 132-774 18,974 12 Informational and Instructional Expenses 909 2,001 (2,003) - - (2) (0) (0) (0) - (0) (2) 13 Miscellaneous Customer Service and 910 2,610 - - - 2,610 52 40 19-111 2,721 14 Informational Expenses - 15 Total Operation Expense 69,017 (33,339) (3,780) (8,440) 23,457 469 359 170-998 24,455 16 Sales Expenses 17 Operation 18 Supervision 911 - - - - - - - - - - - 19 Demonstrating and Selling Expenses 912 1,337 - - - 1,337 27 20 10-57 1,394 20 Advertising Expenses 913 - - - - - - - - - - - 21 Miscellaneous Sales Expenses 916 464 - - - 464 9 7 3 1,250 2/ 1,270 1,734 22 Total Operation Expense 1,801 - - - 1,801 36 28 13 1,250 1,327 3,128 23 Sub-Total 175,993 (63,533) (3,780) (8,440) 100,239 2,005 1,534 726 1,250 5,515 105,754 24 Uncollectible Accounts 904 52,799 - - - 52,799 - - - - - 52,799 25 Total Customer Service and Marketing 228,793 (63,533) (3,780) (8,440) 153,039 2,005 1,534 726 1,250 5,515 158,553 26 1/1/14-1/1/15-1/1/16-27 12/31/14 12/31/15 6/30/16 28 1/ Annual Inflation Rate 2.0% 1.5% 1.4% 29 No. of Months in Period 12 12 6 30 Pro-rated Inflation Rate 2.0% 1.5% 0.7% 31 2/ Plug-in Vehicles (PEV) Amortization sponsored by Witness Uzenski 32 ($6,250 Deferred Debit balance amortized over 5 years)
Projected Operation and Maintenance Expenses Schedule: C5.8 Administrative and General Expenses Witness: T. M. Uzenski ($000) Page: 1 of 1 (a) (b) (c) (d) (e) (f) (g) (h) (i) (j) (k) (l) Projected Adjustments 1/1/13-1/1/14-1/1/15-1/1/16-12/31/13 Rate Case Normalization Adjusted 12/31/14 12/31/15 6/30/16 Other Total Line Historical Adjustments Adjustments Historical Inflation Adj Inflation Adj Inflation Adj Adjustments Projected Projected No. Description Account Test Period 1/ 2/ Test Period 3/ 3/ 3/ 4/ Adjustments Test Period 1 Administrative and General Expenses sum (c) thru (e) sum (f) thru (j) (f) + (k) 2 Operation 3 Administrative and General Salaries 920 125,236 (12,198) (14,713) 98,325 1,967 1,504 713 (17,153) (12,970) 85,356 4 Office Supplies and Expenses 921 28,442 - - 28,442 569 435 206-1,210 29,652 5 (Less) Administrative Expenses Transferred-Cr. 922 (23,583) - - (23,583) (472) (361) (171) - (1,003) (24,586) 6 Outside Services Employeed 923 25,575 - - 25,575 512 391 185-1,088 26,663 7 Property Insurance 924 7,548 (198) - 7,350 147 112 53-313 7,663 8 Injuries and Damages 925 17,996 - - 17,996 - - - 2,308 2,308 20,304 9 Franchise Requirements 927 - - - - - - - - - - 10 Regulatory Commission Expenses 928 447 - - 447 9 7 3-19 466 11 (Less) Duplicate Charges-Cr. 929 - - - - - - - - - - 12 General Advertising Expenses 930.1 3,599 (1,981) - 1,618 32 25 12-69 1,687 13 Miscellaneous General Expenses 930.2 5,339 (1,825) - 3,514 70 54 25 5,000 5,150 8,664 14 Rents 931 4,839 (853) - 3,986 80 61 29-170 4,156 15 Total Operation Expense 195,440 (17,055) (14,713) 163,672 2,914 2,229 1,056 (9,845) (3,647) 160,025 16 Maintenance 17 Maintenance of General Plant 935 5,120 - - 5,120 102 78 37-218 5,338 18 Total Maintenance Expense 5,120 - - 5,120 102 78 37-218 5,338 19 Grand Total Operation & Mainenance Expense 200,560 (17,055) (14,713) 168,792 3,016 2,307 1,093 (9,845) (3,429) 165,363 20 Historical 1/1/14-1/1/15-1/1/16-21 Account Adjustment 12/31/14 12/31/15 6/30/16 22 1/ Rate Case Adjustments: 3/ Annual Inflation Rate 2.0% 1.5% 1.4% 23 Eliminate Executive Incentive Plan Compensation 920 (12,198) No. of Months in Period 12 12 6 24 Eliminate Renewable Energy Program 924 (198) Pro-rated Inflation Rate 2.0% 1.5% 0.7% 25 Disallowed Advertising Expenses 930.1 (1,981) 26 Disallowed Corporate Memberships 930.2 (1,190) 4/ Other Projected Adjustment: Account Amount 27 Eliminate Energy Optimization Program 930.2 (194) Change from Liability to Equity Accting for Perf. Shares 920 (17,153) 28 Eliminate Renewable Energy Program 930.2 (441) Injuries & Damages based on five year historical average 925 2,308 29 Eliminate MGM Rent Expense 931 (853) Cloud Technology 930.2 5,000 30 Total Rate Case Adjustments (17,055) (9,845) 31 2/ Normalization Adjustment: 32 Employee Incentive Plan Adjustment 920 (14,713)
Projected Operation and Maintenance Expenses Schedule: C5.9 Employee Pensions and Benefits Witness: J. C. Wuepper Projected 12 Month Period Ending June 30, 2016 Page: 1 of 2 ($000) (a) (b) (c) (d) Employee Pensions and Benefits Expense Historical Projected Line Period Ending Period Ending No. Description 12/31/13 Adjustments 6/30/16 1 Post-Retirement Benefits 2 Pension 119,720 (24,451) 95,269 3 Post Empl Hlth Care (OPEB) (16,035) (37,567) (53,602) 4 New Hire Retiree VEBA 1,346 1,813 3,159 5 OPEB Regulatory Deferral - 53,602 53,602 1/ 6 Employee Savings Plan 21,488 4,308 25,797 7 Subtotal Post-Retirement 126,519 (2,295) 124,224-8 Active Healthcare - 9 Benefit Plan Admin Fees 5,734 244 5,978 10 Healthcare Expenses 84,055 15,786 99,841 11 Dental Expenses 6,252 1,174 7,426 12 Vision Expenses 339 64 403 13 Life Insurance 4,511 522 5,034 14 Retiree Actual Benefit Pmts (47,934) (9,002) (56,936) 15 Subtotal Active Healthcare 52,958 8,788 61,747 16 Other 17 Accrued Vacation Expense (153) (18) (171) 18 Supplemental Retirement Plan - 1,607 1,607 19 Executive Supplemental Retirement Plan - 4,624 4,624 20 Wellness Plan Expenses 2,027 86 2,113 21 Disability Expenses 1,057 122 1,179 22 Affordable Care Act 14 401 416 23 NonQual Savings Plan/Deferred Comp 2,632 (684) 1,949 24 General Benefit Expenses 1,551 66 1,617 25 Retirement Administration Fees 547 23 571 26 Payroll - Other Labor 45 2 47 27 O&M Project Reimbursements (644) (1,733) (2,376) 28 Subtotal Other 7,076 4,497 11,573 29 Total before Other Allocations 186,554 10,990 197,544 30 A&G Capitalization (4,647) 53 (4,594) 31 Other Transfers & Allocations (5,162) 59 (5,103) 32 Eliminate Energy Optimization (EO) - (1,159) (1,159) 33 Eliminate Renewable Energy Program (REP) - (1,395) (1,395) 34 Total Benefit Expense (Account 926) 176,744 8,548 185,293 1/ OPEB Regulatory Deferral sponsored by Witness Uzenski on Exh. A-10 C5.12
Projected Operation and Maintenance Expenses Schedule: C5.9 Employee Pension and Benefits ($000) Witness: J. C. Wuepper Projected 12 Month Period Ending June 30, 2016 Page: 2 of 2 ($000) (a) (b) (c) (d) (e) (f) (h) (i) (j) Projected Adjustments Historical Adjusted 1/1/14-1/1/15-1/1/16 - Total Projected Line Period Ending Rate Case Historical 12/31/14 12/31/15 6/30/16 Other Projected Period Ending No. Description 12/31/13 Adjustments Test Period Inflation 1/ Inflation 1/ Inflation 1/ Adjustments Adjustments 6/30/16 Col (b) + Col (c) Sum (e) thru (h) Col (d) + Col (i) 1 Post-Retirement Benefits 2 Pension 119,720-119,720 - - - (24,451) (24,451) 95,269 2/ 3 Post Empl Hlth Care (OPEB) (16,035) - (16,035) - - - (37,567) (37,567) (53,602) 3/ 4 New Hire Retiree VEBA 1,346-1,346 - - - 1,813 1,813 3,159 5 OPEB Regulatory Deferral 4/ - - - - - - 53,602 53,602 53,602 6 Employee Savings Plan 21,488-21,488 903 1,041 545 1,820 4,308 25,797 7 Subtotal Post-Retirement 126,519-126,519 903 1,041 545 (4,784) (2,295) 124,224 8 Active Healthcare 9 Benefit Plan Admin Fees 5,734-5,734 115 88 42-244 5,978 10 Healthcare Expenses 84,055-84,055 5,464 6,714 3,609-15,786 99,841 11 Dental Expenses 6,252-6,252 406 499 268-1,174 7,426 12 Vision Expenses 339-339 22 27 15-64 403 13 Life Insurance 4,511-4,511 189 219 114-522 5,034 14 Retiree Actual Benefit Pmts (47,934) - (47,934) (3,116) (3,829) (2,058) - (9,002) (56,936) 15 Subtotal Active Healthcare 52,958-52,958 3,080 3,718 1,990-8,788 61,747 16 Other 17 Accrued Vacation Expense (153) - (153) (6) (7) (4) - (18) (171) 18 Supplemental Retirement Plan - - - - - - 1,607 1,607 1,607 19 Executive Supplemental Retirement Pla - - - - - - 4,624 4,624 4,624 20 Wellness Plan Expenses 2,027-2,027 41 31 15-86 2,113 21 Disability Expenses 1,057-1,057 44 51 27-122 1,179 22 Affordable Care Act 14-14 - - - 401 401 416 23 NonQual Savings Plan/Deferred Comp 2,632-2,632 - - - (684) (684) 1,949 24 General Benefit Expenses 1,551-1,551 31 24 11-66 1,617 25 Retirement Administration Fees 547-547 11 8 4-23 571 26 Payroll - Other Labor 45-45 1 1 0-2 47 27 O&M Project Reimbursements 5/ (644) (1,636) (2,279) (46) (35) (17) - (97) (2,376) 28 Subtotal Other 7,076 (1,636) 5,441 76 73 37 5,948 6,133 11,573 29 Total before Other Allocations 186,554 (1,636) 184,918 4,059 4,832 2,571 1,164 12,626 197,544 30 A&G Capitalization (4,647) - (4,647) - - - 53 53 (4,594) 31 Other Transfers & Allocations (5,162) - (5,162) - - - 59 59 (5,103) 32 Eliminate EO 6/ - (1,159) (1,159) - - - - - (1,159) 33 Eliminate REP 6/ - (1,395) (1,395) - - - - - (1,395) 34 Total Benefit Expense (Account 926) 176,744 (4,190) 172,554 4,059 4,832 2,571 1,277 12,738 185,293 1/ Inflation Adjustment Factors: see table below 2/ Carried from Line 17 of Exhibit A-10 C5.10 3/ Carried from Line 17 of Exhibit A-10 C5.11 4/ OPEB Regulatory Deferral sponsored by Witness Uzenski on Exh. A-10 C5.12 5/ Related to Belle River Power Plant chargeout agreement (reclassification adjustment sponsored by Witness Uzenski) 6/ Eliminate benefits expense included in separate surcharge mechanisms (sponsored by Witness Uzenski on Exh. A-3 C16-EO and Exh. A-3 C17-REP)
Projected Operation and Maintenance Expenses Schedule: C5.10 Pension Cost - Qualified Witness: J. C. Wuepper Projected 12 Month Period Ending June 30, 2016 Page: 1 of 1 ($000) (a) (b) (c) (d) Pension Cost - Qualified Historical Projected Line Period Ending Period Ending No. Description 12/31/13 Adjustments 6/30/16 1 Cost Components: 2 Service cost 71,928 (1,601) 70,327 3 Interest cost 142,334 17,496 159,830 4 Expected return on assets (184,661) (32,136) (216,797) 5 Amortization: 6 Net (Gain)/Loss 144,777 (21,365) 123,413 7 Prior service cost 685 257 942 8 Transition - - - 9 Total Amortization 145,462 (21,108) 124,355 10 Net ASC 715-30 (SFAS 87) Cost 175,063 (37,348) 137,715 11 Reconcile Cost to Expense 12 Expense before capitalization & transfers 175,063 (37,348) 137,715 13 Adjustments: 14 Transfers out (30,174) 4,330 (25,843) 15 Transfers in 25,312 (2,362) 22,950 16 Capitalization (50,481) 10,928 (39,553) 17 Expense amount per Exhibit A-10 C5.9 119,720 (24,451) 95,269
Projected Operation and Maintenance Expenses Schedule: C5.11 Other Post Employment Benefits (OPEB) Witness: J. C. Wuepper Projected 12 Month Period Ending June 30, 2016 Page: 1 of 1 ($000) (a) (b) (c) (d) Other Post Employment Benefits (OPEB) Historical Projected Line Period Ending Period Ending No. Description 12/31/13 Adjustments 6/30/16 1 Cost Components: 2 Service cost 35,049 (10,141) 24,908 3 Interest cost 66,775 (1,625) 65,150 4 Expected return on assets (74,286) (24,030) (98,316) 5 Amortization: 6 Net (Gain)/Loss 47,150 (25,372) 21,778 7 Prior service cost (99,371) 7,503 (91,869) 8 Transition - - - 9 Total Amortization (52,221) (17,870) (70,091) 10 Net ASC 715-60 (SFAS 106) Cost (24,683) (53,665) (78,349) 11 Reconcile Cost to Expense 12 Expense before capitalization & transfers (24,683) (53,665) (78,349) 13 Adjustments: 14 Transfers out (7,098) 2,628 (4,470) 15 Transfers in 7,691 (1,807) 5,884 16 Capitalization 8,055 15,277 23,332 17 Expense amount per Exhibit A-10 C5.9 (16,035) (37,567) (53,602)
Projected Operation and Maintenance Expenses Schedule: C5.12 Other Post Employment Benefits (OPEB) Regulatory Deferral Witness: T. M. Uzenski ($000) Page: 1 of 1 (a) (b) (c) (d) (e) (f) (g) (h) (i) Projected Calendar Year Projected Split Year Projected Line Annual Annual Jan-Jun Jul-Dec Jan-Jun Jul-Dec Test Period No. Description 2015 2016 2015 2015 2016 2016 TME 6/30/16 Reference col.(e)+ col.(f) 1 OPEB Expense (1): 2 Service cost 25,252 24,564 12,626 12,626 12,282 12,282 24,908 3 Interest cost 64,732 65,568 32,366 32,366 32,784 32,784 65,150 4 Expected return (94,916) (101,716) (47,458) (47,458) (50,858) (50,858) (98,316) 5 Amortizations (71,898) (68,283) (35,949) (35,949) (34,142) (34,142) (70,091) 6 Total OPEB Expense (76,830) (79,867) (38,415) (38,415) (39,934) (39,934) (78,349) 7 Capitalized and Transferred 24,297 25,197 12,149 12,149 12,598 12,598 24,747 8 Total OPEB Expense (O&M) (52,533) (54,670) (26,266) (26,266) (27,335) (27,335) (53,602) 9 OPEB Regulatory Deferral (2) 26,266 27,335 27,335 53,602 Line 8 (1) Source: Annual 715-60 Expense per Actuary Report (also see workpaper JCW-2) (2) Effective with test period beginning July 1, 2015
Projected Operation and Maintenance Expenses Schedule: C5.13 Advanced Metering Infrastructure (AMI) - Net Savings Witness: R. E. Sitkauskas ($000) Page: 1 of 1 (a) (b) (c) (d) (e) (f) (g) (h) Program Expenses /(Savings) Historical Projected Projected Projected Projected 12 Months 12 Months 12 Months 12 Months Test Period Projected Line Ending Ending Ending Ending 7/1/15 - Net Savings No. Description Account 12/31/13 12/31/14 12/31/15 12/31/16 6/30/16 Adjustment 1 Distribution Expenses 1/ col. (e)/2+col. (f)/2 col. (g) - col. (c) 2 AMI Meter Expenses 2,582 2,774 3,147 3,266 3,207 625 3 Meter Expenses & Other Distribution Savings (2,299) (3,376) (4,692) (5,867) (5,279) (2,980) 4 Total Distribution - Net O&M Cost/(Savings) 586 283 (602) (1,545) (2,600) (2,072) (2,355) 5 Customer Service and Marketing 6 AMI Customer Service & Marketing Expenses 2,704 2,606 1,819 1,794 1,806 (898) 7 Meter Reading & Other Customer Service Savings (11,830) (15,031) (19,998) (25,462) (22,730) (10,900) 8 Total Cust. Service & Mkting - Net O&M Cost/(Savings) 902 / 903 (9,126) (12,425) (18,179) (23,669) (20,924) (11,798) 9 Total AMI - Net O&M Cost/(Savings) (8,843) (13,027) (19,724) (26,269) (22,996) (14,153) 2/ 10 1/ Historical test period savings embedded in Exhibit A-10 C5.6 and C5.7 11 2/ Projected adjustment carried to Exhibit A-10 C5
Test Period Operation and Maintenance Expense Schedule: C5.14 Power Supply Related Expenses Witness: K. A. Holmes ($000) Page: 1 of 1 (a) (b) (c) (d) (e) (f) (g) Other Power Supply Projected Adjusted Period FERC/ Historical Reclasses/ Historical 7/1/15 - Line MPSC Test Period Adjustments Test Period Adjustments 6/30/16 No. Description Account (1) (2) (3) col. (e) - (c) col. (g) - (e) 1 Power Supply Related Expenses 2 Fuel - Steam 501 963,050 3 Allowances 509 15,539 4 Fuel - Nuclear 518 44,389 5 Fuel - Other 547 27,730 6 Purchased Power 555 366,425 7 Other Power Supply 557 (45,346) 8 Load Dispatching 561 10,497 9 Transmission of Electricity by Others 565 248,123 10 Regional Market Expenses 575 10,428 11 Total Power Supply Related Expenses 1,640,835 (192,894) 1,447,941 (3,755) 1,444,186 (1) See Witness Uzenski's Exhibit A-3, Schedule C4 (2) See Witness Uzenski's Exhibit A-3, Schedule C1, col. (d), line 30 (3) See Exhibit A-10, Schedule C4
Projected Depreciation and Amortization Expense Schedule: C6 Projected 12 Month Period Ending June 30, 2016 Witness: T. M. Uzenski ($000) Page: 1 of 2 (a) (b) (c) (d) (e) Adj. Historical Test Line 12-Mo. End Projection 12-Mo. End No. Description 12/31/13 Adjustments 06/30/16 Reference 1 Depreciation & Amort (403-407, 411.1) 2 Plant DD&A (403, 403.1) 469,317 90,559 559,876 Exhibit A-10 C6 page 2, line 14, col. (j) 3 Software Amortization / Intangible (405) 55,206 7,263 62,469 Exhibit A-10 C6 page 2, line 18, col. (j) 4 Subtotal Plant Depr. & Amortization 524,523 97,822 622,345 Exhibit A-10 C6 page 2, line 20, col. (j) 5 AFUDC-Reg Asset Amort (407.3) 148-148 6 DTE-2 Reg Asset Amort (407.3) 2,611-2,611 7 Amortization of CTA (407.3) 18,004-18,004 8 Amortization of COLA - 5,094 5,094 9 Depreciation & Amortization 545,286 102,916 648,202
DTE Electric Company Exhibit No.: A-10 Projected Depreciation and Amortization Expense Schedule No.: C6 Projected 12 Month Period Ending June 30, 2016 Witness: T. M. Uzenski ($000) Page: 2 of 2 (a) (c) (d) (e) (f) (g) (h) (i) (j) (k) (l) Ending Plant Balance & Activity Depreciation & Amortization Expense Historical Average Projected Historical Period 18-Mo. End Projected 12-Mo. End Projected Balance Annual Expense Expense Line 12/31/13 6/30/15 6/30/15 6/30/16 6/30/16 6/30/2015 Composite 12-Mo. End 12-Mo. End Projection No. Description Balance Plant Adj. 1/ Balance Plant Adj. 1/ Balance - 6/30/2016 Depr. Rate 1/ 6/30/16 12/31/13 Change col. (c)+ (d) col. (e)+ (f) (col. (e)+(g)) /2 col. (h) x (i) col. (j) - (k) 1 Depreciable Plant: 2 Production Plant, Steam 6,518,840 922,246 7,441,086 216,977 7,658,062 7,549,574 2.00% 151,162 129,268 21,894 3 Production Plant, Nuclear 516,694 176,841 693,535 115,755 809,289 751,412 4.06% 30,516 20,427 10,089 4 Production Plant, Hydraulic 194,748 101,028 295,776 71,600 367,376 331,576 3.04% 10,065 5,924 4,140 5 Production Plant, Other 285,530 3,069 288,599 3,004 291,603 290,101 3.71% 10,774 10,512 261 6 Production Plant, MERC 79,514 3,969 83,484 2,465 85,949 84,716 2.81% 2,381 2,129 252 7 Transmission Plant 89,568 (1,948) 87,620 (1,299) 86,321 86,970 1.57% 1,364 1,382 (18) 8 Distribution Plant 6,571,327 488,896 7,060,222 362,206 7,422,428 7,241,325 3.90% 282,293 252,501 29,792 9 Distribution Plant, AMI 125,587 91,300 216,887 50,475 267,362 242,125 5.00% 12,106 3,140 8,967 10 General Plant, Amortizable 234,110 (21,194) 212,916 (20,369) 192,547 202,732 8.26% 16,752 18,920 (2,168) 11 General Plant, Depreciable 546,961 95,796 642,757 56,264 699,021 670,889 4.43% 29,714 25,113 4,600 12 Acquisition 1-240,000 240,000-240,000 240,000 5.00% 9,000-9,000 13 Acquisition 2-100,000 100,000-100,000 100,000 5.00% 3,750-3,750 14 Total Depreciable Plant 15,162,878 2,200,002 17,362,880 857,079 18,219,959 17,791,420 559,876 469,317 90,559 15 Intangible Plant, 5 year 161,257 43,322 204,579 13,884 218,463 211,521 20.00% 42,304 31,665 10,639 16 Intangible Plant, 7 year 36,555 (14,993) 21,562 (17,276) 4,286 12,924 14.29% 1,846 5,222 (3,376) 17 Intangible Plant, 15 year 274,782-274,782-274,782 274,782 6.67% 18,319 18,319 0 18 Total Intangible Plant 472,594 28,329 500,923 (3,392) 497,532 499,227 62,469 55,206 7,263 19 Land/Land Rights 65,078-65,078-65,078 65,078 - - - 20 Total Plant 15,700,551 2,228,331 17,928,882 853,687 18,782,569 18,355,725 622,345 524,522 97,823 21 1/ Plant Adjustment Details: 22 Environmental Unitization (in Line 2 above) 782,602 166,710 23 Other Plant Unitization 1,414,864 943,667 24 Total Plant Unitization 2,197,466 1,110,377 25 Acquisition 1 240,000-26 Acquisition 2 100,000-27 Plant Retirements (309,135) (256,690) 28 Total Plant in Service Activity 2,228,331 853,687 1/ Reflects 2013 composite depreciation rates based on Case No. U-16117 detailed Final Order depreciation rates, effective July 2011
Projected Property and Other Taxes Schedule: C7 ($000) Witness: M. Lewis Page: 1 of 2 (a) (b) Line Projected No. Description Test Period 1 Payroll Taxes 40,336 2 MPSC Assessment 8,941 3 Property Taxes 239,266 4 Other 186 5 Total 288,729
Property Tax Expense Schedule: C7 ($000) Witness: M. Lewis Page: 2 of 2 (a) (b) (c) (d) (e) Line Projected No. Description Test Period 1 Property Tax Expense 2 Prior Year Tax Liability 228,949 3 Incremental Taxes Assessed (calc. below) 17,584 4 Estimated Tax Liability 246,534 5 6 Expense Prior Year Liability (Line 2 x 61%) 61% 139,659 7 Current Year Liability (Line 4 x 39%) 39% 96,148 8 Property Tax Expense 235,807 9 Annual Expense Estimate, MERC 1,119 10 Annual Expense Estimate, Plant Acquistions 2,340 11 Property Tax Expense Adjusted 239,266 12 13 STC True Cash Value Taxable Value 14 Cost Multiplier (Cost x Multiplier) (True Cash Value x 50%) 15 Incremental Taxes Assessed 16 Retirements (170,617) 0.54 (92,133) (46,067) 17 Additions 898,923 0.95 854,985 427,493 18 Increment to Taxable Value 728,307 762,852 381,426 19 Taxable Value Prior Year Carryforward 4,152,990 20 Total Taxable Value 4,534,416 21 22 Taxable Value Prior Year Carryforward 4,152,990 23 x Depreciation Multiplier 0.01500 24 Annual Obsolescence (62,295) 25 Increment to Taxable Value 381,426 26 Property Tax Base 319,131 27 x Millage 55.1 28 Incremental Taxes Assessed 17,584
Projected Federal Income Tax Schedule: C8 ($000) Witness: M. Lewis Page: 1 of 1 (a) Line Projected No. Description Test Period 1 Net Operating Income 584,062 2 Interest Expense (246,830) 3 Interest Synchronization (599) 4 Net Income 336,634 5 6 Current Federal Income Tax Expense 109,971 7 Deferred Federal Income Tax Expense 52,861 8 Total Federal Income Tax Expense 162,832 9 10 Pre-Tax Income 499,466 11 12 Permanent Differences 13 ESOP (6,921) 14 Meals and Entertainment 900 15 Domestic Production Activities Deduction (6,550) 16 AFUDC Equity (21,846) 17 Total Permanent Differences (34,417) 18 19 Temporary Differences 20 Pension (3,319) 21 OPEB (77,082) 22 Customer 360 Regulatory Asset Deferral (9,704) 23 COLA Amortization 3,820 24 OPEB Regulatory Liability Deferral 40,468 25 Plug-in Electric Vehicles Amortization 938 26 Property Tax (20,482) 27 AFUDC Debt (12,635) 28 Book Depreciation 618,863 29 Tax Depreciation (430,189) 30 Salvage Proceeds 5,000 31 DTE2 Reg Asset Amortization 2,611 32 Contributions in Aid of Construction 24,300 33 Tax Interest During Construction 23,978 34 Repairs Deduction (99,100) 35 State Deferred Taxes 37,811 36 Casualty Loss Deduction (51,500) 37 Section 263A Adjustment (15,692) 38 Removal Costs (147,624) 39 Nuclear Fuel Book Amortization 54,766 40 Nuclear Fuel Tax Depreciation (42,215) 41 Miscellaneous Intangible Plant Deducted - 303 (78,854) 42 FERMI 2 Outage Accrual 5,038 43 Amortization FERMI License (880) 44 Loss on Reacquired Debt 2,834 45 Cost to Achieve Amortization 18,004 46 Total Temporary Differences (150,846) 47 48 Total Permanent and Temporary Differences (185,262) 49 50 Federal Taxable Income 314,203 51 Tax Rate 35% 52 Total Current Federal Income Tax Expense 109,971 53 54 Deferred Federal Income Tax Expense 52,796 55 Medicare Part D Subsidy Amortization 1,473 56 FAS 109 Amortization 2,940 57 Investment Tax Credit Amortization (4,348) 58 Total Deferred Federal Income Tax Expense 52,861 59 60 Total Federal Income Tax Expense 162,832 (b)
Projected Michigan Corporate Income Tax Schedule: C9 ($000) Witness: M. Lewis Page: 1 of 1 (a) (b) Line Projected No. Description Test Period 1 Federal Taxable Income 314,203 2 Depreciation Adjustment (173,252) 3 State and Local Taxes Based on Income 10,252 4 Domestic Production Activities Deduction 6,550 5 Michigan Taxable Income 157,753 6 Apportionment % 97% 7 Apportioned Michigan Corporate Income Tax Base 153,020 8 Tax Rate 6% 9 Current Michigan Corporate Income Tax 9,181 10 11 Deferred Michigan Corporate Income Tax 21,063 12 Amortization of MCIT Miscellaneous Deferred Debit 15,600 13 Total Deferred Michigan Corporate Income Tax 36,663 14 15 Total Michigan Corporate Income Tax 45,844
Municipal Income Tax Expense Schedule: C10 ($000) Witness: M. Lewis Page: 1 of 1 (a) Line Projected No. Description Test Period 1 Federal Taxable Income 314,203 2 Domestic Production Activities Deduction 6,550 3 Local Taxes Based on Income 1,070 4 Municipal Income Tax Base 321,823 5 Tax Rate 0.3326% 6 Current Municipal Income Tax Expense 1,070 7 8 Deferred Municipal Income Tax 627 9 Amortization of City of Detroit Miscellaneous Deferred Debit 520 10 Total Deferred Municipal Income Tax 1,147 11 12 Total Municipal Income Tax 2,218 (b)
Projected Allowance for Funds Used During Construction Schedule: C11 Projected 12 Month Period Ending June 30, 2016 Witness: T. M. Uzenski ($000) Page: 1 of 1 (a) (b) (c) (d) Test Line Period No. Description 12/31/13 Changes 6/30/16 1 AFUDC - Equity 13,980 9,115 23,095 2 AFUDC - Debt 7,480 5,155 12,635 3 Total AFUDC 21,460 14,270 35,730 Exhibit A-3.C1 column (j) Exhibit A-10.C1.1 column (j)
Other Income / (Deductions) Schedule: C12 Projected 12 Month Period Ending June 30, 2016 Witness: T. M. Uzenski ($000) Page: 1 of 1 (a) (b) (c) (d) Test Line Period No. Description 12/31/13 Changes 6/30/16 1 Asset Gains/(Losses) (895) 895-2 Other Income and (Deductions) 426-426 3 Interest on Customer Deposits (1,548) - (1,548) 4 Unamortized Loss on Reacquired Debt Expense (3,186) 352 (2,834) 5 Net Other Income / (Deductions) (5,203) 1,247 (3,956) Exhibit A-3.C1 column (k) Exhibit A-10.C1.1 column (k)
Income Tax Effect of Interest Schedule: C13 Allowed in Ratemaking Formula - Total Electric Witness: M. A. Suchta 12 Months Ended 12/31/2013 and 6/30/2016 Page: 1 of 1 ($000) (a) (b) (c) (d) Line 6/30/2016 No. Description 12/31/2013 6/30/2016 Source 1 Total Electric Rate Base 11,397,329 13,581,502 Exh. A-9, Sch. B1 2 Weighted Cost of Debt (1) 2.00% 1.82% Exh. A-11, Sch. D1 3 Interest Allowed in Ratemaking Formula 227,525 246,830 Line 1 x Line 2 4 Interest Deduction Included in 5 Recorded Income Tax Accruals 242,254 250,116 A-10WPC13 6 Interest Deduction Change (14,729) (3,286) Line 3 - Line 5 7 Composite State and Municipal Income Tax Rate 6.15% 6.15% Exh. A-10, Sch. C2 8 Effect on State and Municipal Income Tax Expense 906 202 (Line 6 x Line 7) x -1 9 Effect on Federal Taxable Income 13,823 3,084 (Line 6 - Line 8) x -1 10 Federal Income Tax Rate 35.00% 35.00% Exh. A-10, Sch. C2 11 Effect on Federal Tax Expense 4,838 1,079 Line 9 x Line 10 12 Total Tax Effect on Net Operating Income (5,744) (1,281) (Line 8 + Line 11) x -1 (1) Includes Short and Long-Term Interest