The ratings on DTE Energy Co. are a function of its regulated utility subsidiaries, Detroit Edison Co. and Michigan Consolidated Gas Co. (MichCon), and a growing portfolio of higher-risk nonregulated activities. DTE Energy will derive the majority, but a decreasing percent, of its credit quality from its regulated utility units, Detroit Edison and MichCon, which currently contribute about 70% of DTE Energy's consolidated funds from operations (FFO). The utility units' FFO contribution is expected to trend down to 60% over the next couple years as the nonregulated operations gain more emphasis. Providing ratings support is Detroit Edison, which is aided by favorable electric restructuring legislation, Michigan's increasingly diverse economy, the retention of Detroit Edison's generating assets, and continued cost efficiencies.
