Overview Key strengths Key risks Monopolistic, vertically integrated electric utility and gas distribution utility operations. Lack of operating diversity. It depends on Michigan regulators to sustain its credit quality. Favorable regulatory construct in Michigan. Environmental risks due to its dependence on natural gas and coal-fired generation (about 70% of electricity generated or purchased in 2022), though this is partially mitigated by a plan to retire coal by 2025. Large customer base of 1.9 million electric and 1.8 million gas customers. Negative discretionary cash flow, reflecting robust capital spending, which indicates external funding needs. Largely contracted nature of independent power producer operations through the near-term. Susceptibility to adverse weather events, including winter storms. Exposure to cyclical commercial and industrial customers, which
