Edgar Filing: DTE ENERGY CO

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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

SCHEDULE 14A

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DTE Energy Company

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LETTER TO SHAREHOLDERS

Dear Fellow Shareholders,

We invite you to attend our company’s annual meeting of shareholders, which will be held on May 3, 2018 in Palm Beach, Florida. Please see page 77 for details on attending.

2017 was a year of great progress on many fronts for DTE Energy, driven by the energy and focus of our 10,000 dedicated employees. Their engagement earned our company its fifth consecutive Gallup Great Workplace Award, placing us in the top four percent worldwide.

Our employees also delivered on our commitment to our customers. Our response to the historic storm in March 2017, along with process improvements in the way we serve our customers, propelled us to the top of JD Power’s rankings for gas and electric business customer satisfaction among our Midwest peers.

We also had a landmark year in our operations. We achieved top decile reliability at our largest power plants and wind generation, and we made significant progress in our ongoing work to modernize our energy grid and gas distribution system while keeping our customers’ bills affordable.

In addition to delivering for our customers, we produced record results for you, our shareholders. After raising our earnings guidance twice during the year, we achieved record earnings of more than $1 billion.

Our operational and financial strength enables us to plan for the long term; it also enables us to look beyond the walls of our company to the role we aspire to play in building healthy, strong and sustainable communities. In addition to donating over $50 million to charitable causes in 2017, DTE Energy is working to harness the economic engine of the private sector to the task of revitalizing our neighborhoods, strengthening our local economies, and preparing our youth to succeed in the workforce.

Our commitment to our communities also extends to environmental sustainability. Our announcement in May 2017 of plans to step down our carbon emissions more than 80 percent by 2050 establishes DTE Energy as an industry leader without ever losing sight of our mission to provide safe, affordable and reliable energy to our customers.

Thank you for your continued investment in DTE Energy.




James B. Nicholson	Gerard M. Anderson
Lead Independent Director	Chairman and Chief Executive Officer

DTE Energy Company

One Energy Plaza

Detroit, Michigan 48226

2018 Notice of Annual Meeting of Shareholders and Proxy Statement



Meeting Date:	Time:	Location:
Thursday, May 3, 2018	8:00 a.m. Eastern Daylight Time	Four Seasons Resort Palm Beach 2800 South Ocean Boulevard Palm Beach, FL 33480

We invite you to attend the annual meeting of DTE Energy Company.

Agenda:



1.	Elect twelve directors;
2.	Ratify the appointment of PricewaterhouseCoopers LLP by the Audit Committee of the Board of Directors as our independent registered public accounting firm for the year 2018;
3.	Provide an advisory vote to approve executive compensation;
4.	Vote on a management proposal to amend and restate the Long-Term Incentive Plan to authorize additional shares;
5.	Vote on a shareholder proposal to perform an economic assessment of continued operation of Fermi 2;
6.	Vote on a shareholder proposal to amend our bylaws to allow shareholders with 10% outstanding common stock in the aggregate to call a special meeting; and
7.	Consider any other business that may properly come before the meeting.

Only shareholders of record at the close of business on March 6, 2018, the record date for this meeting, or their representatives authorized by proxy may attend or vote at the meeting.

This 2018 Notice of Annual Meeting, as well as the accompanying Proxy Statement and proxy card, will be first sent or given to our shareholders on or about March 19, 2018.

This year, beginning on or about March 19, 2018, we have conserved resources and reduced costs by mailing a meeting notice to many of our registered and beneficial shareholders containing instructions on how to access our Proxy Statement and Annual Report on Form 10-K and vote online or how to request a paper copy. Shareholders who receive that meeting notice will not receive a paper copy of the Proxy Statement and Annual Report on Form 10-K or a proxy card unless they request one.

Every vote is important. You may vote your shares (1) by telephone, (2) via the Internet, (3) if you received a paper copy, by completing and mailing the enclosed proxy card in the return envelope or (4) in person at the annual meeting. Specific instructions for voting by telephone or via the Internet are attached to the proxy card or to the meeting notice that you received if you did not receive a paper copy. If you attend the meeting and vote at it, your vote at the meeting will replace any earlier vote by telephone, Internet or proxy. If you wish to attend the annual meeting in person, you must register in advance. Please vote your proxy, then follow the instructions on page 77 to pre-register.



By Order of the Board of Directors

Lisa A. Muschong Vice President, Corporate Secretary & Chief of Staff

March 8, 2018

Important Notice Regarding the Availability of Proxy Materials for the Annual Meeting of Shareholders to Be Held on May 3, 2018:

The Proxy Statement and Annual Report are available to security holders free of charge at

proxydocs.com/dte

TABLE OF CONTENTS



PROXY STATEMENT SUMMARY	1
PROPOSAL NO. 1 — ELECTION OF DIRECTORS	5
Nominees for Election at this Meeting	7
CORPORATE GOVERNANCE	13
Governance Guidelines	13
Election of Directors and Vacancies	13
Composition of the Board	14
Director Independence and Categorical Standards	14
Assessment of Board and Committee Performance	15
Terms of Office	15
Election of the Chairman and the CEO; Lead Independent Director	15
Board Meetings and Attendance	15
Executive Sessions	15
Codes of Business Conduct and Ethics	16
Communications with the Board	17
COMMITTEES OF THE BOARD OF DIRECTORS	17
BOARD OF DIRECTORS RISK OVERSIGHT FUNCTIONS	19
BOARD OF DIRECTORS COMPENSATION	21
2017 DIRECTOR COMPENSATION TABLE	23
INFORMATION ON COMPANY EXECUTIVE OFFICERS	25
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION	25
INDEMNIFICATION AND LIABILITY	25
SECURITY OWNERSHIP OF DIRECTORS AND OFFICERS	26
PROHIBITION ON PLEDGING AND HEDGING COMPANY SECURITIES	27
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE	27
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS	27
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS	28
PROPOSAL NO. 2 — RATIFICATION OF APPOINTMENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM	29
Fees to the Independent Registered Public Accounting Firm	29
Policy on Audit Committee Pre-Approval of Audit and Permissible Non-Audit Services of Independent Registered Public Accounting Firm	29
Report of the Audit Committee	31
PROPOSAL NO. 3 — ADVISORY PROPOSAL — NONBINDING VOTE TO APPROVE EXECUTIVE COMPENSATION	32
PROPOSAL NO. 4 — MANAGEMENT PROPOSAL — APPROVAL OF AN AMENDMENT AND RESTATEMENT OF THE DTE ENERGY COMPANY LONG-TERM INCENTIVE PLAN	34
EXECUTIVE COMPENSATION	38
Compensation Discussion and Analysis	38
Independent Review of Compensation Program	42
Management’s Role	43
Compensation and Peer Group Assessment	43
Key Components of Executive Compensation	44
Base Salary	44



Annual and Long-Term Incentives	44
Executive Performance Plan	45
Annual Incentives	46
Long-Term Incentives	50
Pension and Deferred Compensation	53
Executive Benefits	53
Post Termination Agreements	54
Stock Ownership Policy	54
Internal Revenue Code Limits on Deductibility of Compensation	54
Report of the Organization and Compensation Committee	55
Summary Compensation Table	56
Grants of Plan-Based Awards	58
Outstanding Equity Awards at Fiscal Year-End	59
Option Exercises and Stock Vested in 2017	59
Pension Benefits	60
Deferred Compensation	62
POTENTIAL PAYMENTS UPON TERMINATION OF EMPLOYMENT	64
CEO PAY RATIO	66
PROPOSAL NO. 5 — SHAREHOLDER PROPOSAL — INDEPENDENT ECONOMIC ANALYSIS OF EARLY CLOSURE OF FERMI 2 NUCLEAR PLANT	68
PROPOSAL NO. 6 — SHAREHOLDER PROPOSAL — AMENDMENT OF BYLAWS TO ALLOW HOLDERS OF 10% OF SHARES TO CALL SPECIAL MEETING	70
CONSIDERATION OF OTHER BUSINESS	71
INFORMATION CONCERNING VOTING AND PROXY SOLICITATION	72
QUESTIONS AND ANSWERS	72
2019 ANNUAL MEETING OF SHAREHOLDERS	78
Shareholder Proposals and Nominations of Directors	78
SOLICITATION OF PROXIES	79
EXHIBIT A	A-1

PROXY STATEMENT SUMMARY

DTE Energy Aspiration and System of Priorities

At DTE Energy Company (“DTE Energy,” the “Company,” “we,” “us” or “our”), we aspire to be the best-operated energy company in North America and a force for growth and prosperity in the communities where we live and serve. This aspiration drives everything we do and has led us to develop a system of corporate priorities that guide our daily, monthly and annual plans which help us to achieve this aspiration. Our Board of Directors (the “Board”) evaluates our Company’s and executives’ performance based upon goals that align with this system of priorities and we will refer to this system of priorities as we discuss DTE Energy’s performance and our compensation programs throughout this Proxy Statement.

Becoming the best-operated energy company means having great corporate governance, competitive compensation and excellent shareholder relations.



	DTE ENERGY 2018 PROXY STATEMENT 1

Shareholder Engagement

We have continued our shareholder engagement activities this year and, as a result of those discussions, we’ve learned a lot about what is important to our shareholders. The Shareholder engagement team consists of members from the Corporate Secretary's office, the General Counsel organization, Investor Relations, Environmental Management, and Corporate Communications. Shareholder engagement is a year-round process for us.



Every spring we reach out to large shareholders to discuss issues related to proxy season and the proposals to be presented at our annual meeting. In the fall we conduct another round of conversations to discuss general governance issues and trends. We also discuss pressing matters on an ad hoc basis.			Our shareholder engagement activities help us identify governance and compensation policies and practices that are most important to our shareholders.
The shareholder engagement team reports directly to the Corporate Governance Committee and other committees as needed, conveying the feedback received from shareholders and proposing implementation of best practices.			The committees and the full Board of Directors deliberate over proposed governance changes, adopt best practices and provide guidance to the shareholder engagement team in their communications with shareholders.

In 2017, the Company held discussions with shareholders who collectively own or exercise voting control over 33.7% of the Company’s outstanding shares. In addition, the Company routinely contacts shareholders who have submitted proposals for inclusion in our annual proxy statement, in an effort to understand their concerns and to address, where possible, the issues behind their proposals. We will continue to look for opportunities to provide more information about the Company’s approach on topics of interest to shareholders, and to stimulate more conversations with shareholders.

Governance Highlights

The Board is committed to creating long-term value for our shareholders while operating in an ethical, legal, environmentally sensitive and socially responsible manner. The Board follows sound governance practices, some of which are highlighted below. For more detail, see the “Corporate Governance” section of this Proxy Statement.


•	Eleven of twelve director nominees, 92%, are independent; our Chairman & Chief Executive Officer ("CEO") is the only management director.


•	All Board committees are composed exclusively of independent directors.


•	We have implemented a proxy access provision, which makes it possible for a group of shareholders meeting certain criteria to nominate and include in the Company’s proxy materials a candidate for the Board.


•	We have a Lead Independent Director, elected by the independent members of the Board. The Lead Independent Director maintains final approval authority over Board agendas, meeting materials and schedules. The Lead Independent Director is also available for consultation and direct communication with large shareholders.


•	Independent directors met in executive sessions chaired by the Lead Independent Director at six of the seven 2017 Board meetings.


•	All of our directors are elected annually.


•	We have a majority vote requirement for uncontested director elections.


•	The Board and its committees conduct annual self-assessments. In addition, each independent director who has served for one year or more undergoes an annual peer review.


•	Our executive officers and directors are all subject to robust stock ownership requirements.


•	We have instituted anti-hedging policies applicable to all Company directors, officers and employees.



2 DTE ENERGY 2018 PROXY STATEMENT


•	Our Board’s Mission and Governance Guidelines recommend that the Board consider diversity of characteristics including experience, gender, race, ethnicity and age when evaluating nominees for the Board.


•	We limit our directors who are CEOs of public companies to a total of not more than three public company boards and all other directors to a total of not more than four public company boards.

Performance Highlights

The Company continued to deliver on its objectives to provide strong earnings per share and dividend growth in 2017, while maintaining a strong balance sheet, employee engagement and improving customer service. Some highlights of the Company’s 2017 performance include:


•	Achieved 7.2% compound operating earnings per share growth during the five years ending 2017 (see discussion of operating earnings on page 47).


•	Increased our dividend payment to an annualized rate of $3.30 per share in 2017, representing a 7.1% increase over the annualized dividend rate in 2016.


•	Provided our shareholders with a five-year total shareholder return of 216% (indexed with 2012 as the base year = 100%).


•	Delivered cash from operations of $2.1 billion in 2017.


•	Achieved Highest Customer Satisfaction award in the Midwest from J.D. Power for both electric and gas business customers.


•	Received Gallup Great Workplace Award for the fifth consecutive year.


•	Announced a broad sustainability initiative that will reduce our carbon emissions by more than 80 percent by 2050. More information on our sustainability efforts can be found at dteenergy.com/esg.

Executive Compensation Highlights

Our executive compensation programs are designed to be competitive with our peers, have a meaningful performance component linked to the achievement of short-term and long-term goals that align with our shareholders’ long-term interests and encourage executives to have an ownership interest in the Company. Our Chairman and CEO’s total compensation shows strong pay-for-performance alignment with growth in long-term shareholder value creation. Our CEO’s compensation growth trend is consistent with the growth in value of a $100 investment in DTE Energy Company stock made at the beginning of 2012.



CEO Total Compensation ($000s)	10,174	12,499	15,836
Total Shareholder Return (Indexed, Base Period 2012=100)	148.82	188.89	216.45



	DTE ENERGY 2018 PROXY STATEMENT 3

The Company’s compensation programs are also designed to clearly align performance objectives for our named executive officers with the interests of shareholders and with our system of priorities. Our performance measures are designed to help move our Company towards achieving these priorities. For more details, see our priorities alignment chart in the Compensation Discussion and Analysis Summary on page 39.

Other highlights from our compensation program include:


•	Our CEO received 55% of his 2017 total compensation in contingent, performance-based incentives. For our other named executive officers, the average percentage of contingent, performance-based compensation was 48%. See more details on page 40.


•	Our short-term and long-term performance metrics all tie directly to our system of priorities (see above). These are the same metrics that management uses to assess the Company’s progress toward our aspiration of becoming the best-operated energy company in North America and a force for growth and prosperity in the communities where we live and serve.


•	Our long-term plan awards include a mix of restricted stock and performance shares designed in part to encourage executive stock ownership. The Board’s Organization and Compensation Committee has not issued stock options since 2010.


•	Our equity compensation plan forbids buyouts of “underwater” stock options. The Company has never bought or repriced “underwater” stock options.


•	Our equity compensation plan requires a minimum one-year vesting period for equity awards. The Company’s typical practice is to require a three-year vesting period for equity awards and the Company has never issued equity awards with less than a one-year vesting period.


•	Our Board has adopted a “clawback” policy that provides that, in the event of an accounting restatement due to material noncompliance with federal securities laws, the Company may recover excess performance-based compensation awarded to current or former officers during the three-year period preceding the restatement.


•	Our executive Change-In-Control Severance Agreements do not include excise tax gross-ups.


•	We have eliminated the automatic vesting of equity issued under our Long-Term Incentive Plan upon a change in control of the Company, unless an acquiring or surviving entity fails to replace or affirm the existing equity awards with awards by the surviving company.

Items for Shareholder Vote at this Meeting

At the 2018 Annual Meeting shareholders will vote on the following proposals:

Proposal 1: Elect twelve members of the Board of Directors for one year terms ending in 2019;

Proposal 2: Ratify the appointment of PricewaterhouseCoopers LLP as our independent auditors;

Proposal 3: Provide a nonbinding vote to approve the Company’s executive compensation;

Proposal 4: Approval of an Amendment and Restatement of the DTE Energy Company Long-Term Incentive Plan;

Proposal 5: Vote on a shareholder proposal to commission an independent economic analysis of the potential cost impact to the company and shareholders of closing Fermi 2;

Proposal 6: Vote on a shareholder proposal to amend DTE bylaws and each appropriate governing document to give holders in the aggregate of 10% of outstanding common stock the power to call a special shareowner meeting.

Shareholders may vote on any other matter that properly comes before the meeting.



4 DTE ENERGY 2018 PROXY STATEMENT

Proposal No. 1 — Election of Directors

The Board of Directors has nominated twelve directors for election at the 2018 annual shareholder meeting. Directors are elected to serve annual terms which expire when their successors are elected at the next year’s annual shareholder meeting. All of the nominees are currently directors of the Company. Charles W. Pryor, Jr., who has served as a director since 1999, announced in November 2017 that he intended to retire from the Board effective May 3, 2018. Mr. Pryor is not nominated for election and therefore not included in the information below.

Proxies cannot be voted for more than twelve persons at this meeting. If any nominee becomes unable or unwilling to serve at the time of the meeting, the persons named in the enclosed proxy card have discretionary authority to vote for a substitute nominee or nominees. It is anticipated that all nominees will be available for election.

The biographies of each of the nominees below contain information regarding the person’s service as a director, business experience and director positions held currently or at any time during at least the last five years. The age provided for each director is as of March 8, 2018. In addition to the information presented below regarding each person’s experience, qualifications, attributes and skills that caused our Corporate Governance Committee and Board to determine that the person should serve as a director, the Board believes that all of the Company’s directors have a reputation for integrity, honesty and adherence to high ethical standards. They each have demonstrated business acumen, strategic insight, an ability to exercise sound judgment and a commitment to service and community involvement. Finally, we value their significant experience on other public company boards of directors and board committees and the diversity that they bring to our Board. The following graphs display information about the skills and experience our Board members bring to their service:



	DTE ENERGY 2018 PROXY STATEMENT 5

The Board's demographic makeup is set forth below:

The biographies below disclose the committees on which each director serves. The following abbreviations are used to denote each committee: Corp Gov=Corporate Governance; O&C=Organization and Compensation; Nuc Rev=Nuclear Review; and PPRC=Public Policy & Responsibility.

THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR THE NOMINEES FOR ELECTION AT THIS MEETING.



6 DTE ENERGY 2018 PROXY STATEMENT

Nominees for Election at this Meeting



	Gerard M. Anderson Chairman (2011–present) and CEO (2010–present), DTE Energy Company


	Previous Experience
	•	DTE Energy Company–President (2004–2013), COO (2005–2010), Executive VP (1997–2004)
	•	McKinsey & Co.–Senior Consultant (1988–1993)
	Other Public Boards
Not Independent	•	The Andersons, Inc. (2008–present)
Age: 59	Qualifications for DTE Energy Company Board of Directors
Director since: 2009	•	Energy Industry Experience
		DTE Energy Chief Operating Officer for 5 years prior to becoming CEO
	•	Growth and Value Creation
		Extensive experience in strategic planning and corporate business development
	•	Operations and Continuous Improvement
		Broad experience managing capital-intensive industries



		David A. Brandon Chairman and CEO, Toys "R" Us, Inc.* (2015–present)


		Previous Experience
		•	University of Michigan–Athletic Director (2010–2014)
		•	Domino’s Pizza, Inc.–Chairman and CEO (1999–2010)
		•	Valassis Communications, Inc. (a marketing and sales promotion firm)–President and CEO (1989–1998)
Independent		Other Public Boards
Age: 65		•	Domino’s Pizza, Inc. (1999–present)
Director since: 2010		•	Herman Miller, Inc. (2011–present)
DTE Committees:		•	Kaydon Corporation (2004–2013)
•	O&C (Chair)	Qualifications for DTE Energy Company Board of Directors
•	Finance	•	CEO Experience
			Service as chief executive of large public companies
		•	Customer Service and Satisfaction
			Extensive experience in marketing and sales
		•	Financial Planning and Review
			Strong skill sets in corporate finance and strategic planning
		•	Executive Compensation
			Experience in executive compensation and organizational best practices
* In September 2017, Toys "R" Us, Inc. filed a voluntary petition for reorganization under Chapter 11 of the U.S. Bankruptcy Code.



	DTE ENERGY 2018 PROXY STATEMENT 7



		W. Frank Fountain, Jr. President, Escambia Enterprises, LLC (an investment and consulting firm)(2012–present)


		Previous Experience
		•	Walter P. Chrysler Museum Foundation–Chairman of Board of Directors (2009–2012)
		•	Chrysler, LLC–Senior VP of External Affairs and Public Policy (1998–2008) VP, Government Affairs (1995–1998)
Independent		Qualifications for DTE Energy Company Board of Directors
Age: 73		•	Corporate Governance
Director since: 2007			Experience as a leader of large business organizations
DTE Committees:		•	Government, Regulatory and Community
•	Audit		Strong skills in public policy, government relations and knowledge of regulatory matters
•	PPRC (Chair)	•	Financial Planning and Review
			Extensive experience with public and financial accounting for complex organizations



		Charles G. McClure, Jr. Managing Partner, Michigan Capital Advisors (a private equity firm)(2014–present)


		Previous Experience
		•	Meritor, Inc.–Chairman of the Board, CEO and President (2004–2013)
		•	Federal-Mogul Corporation–CEO (2003–2004), President and COO (2001–2003)
		•	Detroit Diesel Corporation–President and CEO (1997–2000)
Independent		Other Public Boards
Age: 64		•	Crane Co. (2017–present)
Director since: 2012		•	3D Systems. (2017–present)
DTE Committees:		•	Remy International, Inc. (2015)
•	Audit	•	Meritor, Inc. (2004–2013)
•	Nuc Rev	Qualifications for DTE Energy Company Board of Directors
		•	CEO Experience
			CEO, president and director of several major domestic and international corporations
		•	Operations and Continuous Improvement
			Broad knowledge of business and industry
		•	Employee Engagement, Safety and Talent
			Extensive proven leadership skills and service on boards of industry organizations



8 DTE ENERGY 2018 PROXY STATEMENT



		Gail J. McGovern President and CEO, American Red Cross (2008–present)


		Previous Experience
		•	Harvard Business School–Professor (2002–2008)
		•	Fidelity Personal Investments (a unit of Fidelity Investments)–President (1998–2002)
		Other Public Boards
Independent		•	PayPal Holdings, Inc. (2015–present)
Age: 66		•	eBay Inc. (2015)
Director since: 2003		Qualifications for DTE Energy Company Board of Directors
DTE Committees:		•	CEO Experience
•	O&C		Top executive of major non-profit organization
•	Finance	•	Customer Service and Satisfaction
			Extensive executive experience in marketing, sales and customer relations
		•	Growth and Value Creation
			Experience in strategic planning and corporate finance



		Mark A. Murray Vice Chairman, Meijer, Inc. (2013–present)
		Mark A. Murray Vice Chairman, Meijer, Inc. (2013–present)

		Previous Experience
		•	Meijer, Inc.–President (2006–2013), Co-CEO (2013–2016)
		•	Grand Valley State University–President (2001–2006)
		•	State of Michigan–Treasurer (1999–2001)
Independent		•	Michigan State University–VP of Finance and Administration (1998–1999)
Age: 63		Other Public Boards
Director since: 2009		•	Universal Forest Products, Inc. (2004–2016)
DTE Committees:		•	Fidelity Fixed Income and Asset Allocation (2016–present)
•	Nuc Rev (Co-Chair)	Qualifications for DTE Energy Company Board of Directors
•	PPRC	•	CEO Experience
			President and Co-CEO of a major Michigan-based corporation
		•	Financial Planning and Review
			Strategic planning, corporate development and finance experience
		•	Government, Regulatory and Community
			University president and state government official



	DTE ENERGY 2018 PROXY STATEMENT 9



		James B. Nicholson Chairman, PVS Chemicals, Inc. (a chemical manufacturing and distribution company) (2015–present)


		Previous Experience
		•	PVS Chemicals, Inc. President and CEO (1979–2015), VP (1972–1979), Treasurer (1977–1979)
		•	National Infrastructure Advisory Council–Member (2006–2015)
Independent		Other Public Boards
Age: 74		•	PrivateBancorp, Inc. (2009–2017)
Director since: 2012		Qualifications for DTE Energy Company Board of Directors
DTE Committees:		•	CEO Experience
•	Corp Gov		Lengthy service as chief executive of global business organization
•	O&C	•	Corporate Governance
•	PPRC		Extensive experience with corporate boards and government advisory bodies
		•	Employee Engagement, Safety and Talent
			Leadership in community and professional organizations; member and chair of many civic and non-profit boards



		Josue Robles, Jr. Retired President and CEO, USAA (an insurance and financial services company) (2007–2015)


		Previous Experience
		•	USAA–Executive Vice President, Chief Financial Officer and Corporate Treasurer (1994–2007)
		•	U.S. Army–Director of Army Budget (1991–1993), Commanding General, 1st Infantry Division (1993–1994)
Independent		Qualifications for DTE Energy Company Board of Directors
Age: 72		•	CEO Experience
Director since: 2003			Executive leadership of insurance and financial services company
DTE Committees:		•	Financial Planning and Review
•	Audit (Chair)		Extensive experience with public and financial accounting matters for complex organizations
•	Corp Gov	•	Risk Management
			Broad experience in information systems and controls, senior military leadership experience



10 DTE ENERGY 2018 PROXY STATEMENT



		Ruth G. Shaw Retired Group Executive, Public Policy and President, Duke Nuclear, Duke Energy (2003–2009)


		Previous Experience
		•	Duke Energy–Executive Advisor (2007–2009)
		•	Duke Nuclear–Group Executive for Public Policy and President (2006–2007)
		•	Duke Power Company–President and CEO (2003–2006)
Independent		Other Public Boards
Age: 70		•	Dow DuPont, Inc. (2017–present)
Director since: 2008		•	The Dow Chemical Company (2005–2017)
DTE Committees:		•	SPX Corporation (2015–present)
•	Corp Gov (Chair)	Qualifications for DTE Energy Company Board of Directors
•	O & C	•	Energy Industry Experience
•	Nuc Rev		Extensive experience in the nuclear and energy industries
		•	Corporate Governance
			Service on corporate boards and industry associations and organizations
		•	Government, Regulatory and Community
			Broad knowledge of regulatory matters, public policy and corporate communications



		Robert C. Skaggs, Jr. Retired Chairman and CEO, Columbia Pipeline Group, Inc. (2015–2016)


		Previous Experience
		•	NiSource, Inc.–President (2004–2015) and CEO (2005–2015)
		Other Public Boards
		•	Cloud Peak Energy, Inc. (2015–present)
Independent		•	Columbia Pipeline Group, Inc. (2015–2016)
Age: 63		•	NiSource, Inc. (2005–2015)
Director since: 2017		Qualifications for DTE Energy Company Board of Directors
DTE Committees:		•	CEO Experience
•	Finance		Extensive executive leadership experience in the utility sector
•	Nuc Rev	•	Energy Industry Experience
			Broad experience in natural gas and electric generation, transmission, storage and distribution
		•	Government, Regulatory and Community
			Experience developing regulatory strategies and leading external relations



	DTE ENERGY 2018 PROXY STATEMENT 11



		David A. Thomas President, Morehouse College (2018–present)
		David A. Thomas President, Morehouse College (2018–present)

		Previous Experience
		•	Harvard Business School – H. Naylor Fitzhugh Professor of Business Administration (2016–2017, 1990–2011)
		•	Georgetown University McDonough School of Business–Dean and William R. Berkeley Professor of Business Administration (2011–2016)
Independent		•	Wharton School of Finance–Assistant Professor of Management (1986–1990)
Age: 61		Qualifications for DTE Energy Company Board of Directors
Director since: 2013		•	Employee Engagement, Safety and Talent
Independent			Leadership and research in corporate inclusion and diversity
•	Finance	•	Corporate Governance
•	PPRC		Service on various civic and educational boards, advisor to other corporate boards
		•	Government, Regulatory and Community
			Expertise in executive development and strategic human resource management



		James H. Vandenberghe Retired Vice Chairman and former Director, Lear Corporation (1998–2008)


		Previous Experience
		•	Lear Corporation–President and COO (1997–1998), CFO (1988–1997, 2006–2007)
		Other Public Boards
		•	Lear Corporation (1995–2008)
Independent		•	Federal-Mogul Corporation (2008–2013)
Age: 68		Qualifications for DTE Energy Company Board of Directors
Director since: 2006		•	Growth and Value Creation
DTE Committees:			Extensive experience in strategic planning and managing capital-intensive industries
•	Audit	•	Financial Planning and Review
•	Corp Gov		Broad experience with public and financial accounting for complex organizations
•	Finance (Chair)



12 DTE ENERGY 2018 PROXY STATEMENT

Corporate Governance

Governance Guidelines

At DTE Energy, we are committed to operating in an ethical, legal, environmentally sensitive and socially responsible manner, while creating long-term value for our shareholders. The foundation of our governance practices begins at the top, with the DTE Energy Board of Directors Mission and Guidelines (“Governance Guidelines”). The Governance Guidelines set forth the practices the Board follows with respect to Board composition and selection, Board meetings, the performance evaluation and succession planning for DTE Energy’s Chief Executive Officer (“CEO” or “Chief Executive Officer”), Board committees, Board compensation and communicating with the Board, among other things. The Governance Guidelines are also intended to align the interests of directors and management with those of our shareholders. The following is a summary of the Governance Guidelines, along with other governance practices at DTE Energy.

Election of Directors and Vacancies

The Company has a declassified board of directors. Directors are elected annually for terms which expire upon election of their successor at the next year’s annual shareholder meeting.

If a vacancy on the Board occurs between annual shareholder meetings, the vacancy may be filled by a majority vote of the directors then in office. The new director’s term will expire upon election of their successor at the next year’s annual shareholder meeting.

Under the Governance Guidelines, the Corporate Governance Committee periodically assesses the skills, characteristics and composition of the Board, along with the need for expertise and other relevant factors as it deems appropriate. In light of these assessments, and in light of the standards set forth in the Governance Guidelines, the Corporate Governance Committee may seek candidates with specific qualifications and candidates who satisfy other requirements set by the Board. We believe our Board should be comprised of directors who have had high-level executive experience, have been directors on other boards and have been tested through economic downturns and crises. Industry experience, regional relationships and broad diversity of experience and backgrounds are also factors in Board nominee selection. The Board’s Governance Guidelines confirm that we believe it is desirable for Board members to possess diverse characteristics of gender, race, ethnicity and age, and we consider these factors in Board evaluation and in the identification of candidates for Board membership. We believe this type of composition enables the Board to oversee the management of the business and affairs of the Company effectively. Information about the skills, experiences and qualifications of our directors is included in their biographies beginning on page 7.

The Corporate Governance Committee considers candidates who have been properly nominated by shareholders, as well as candidates who have been identified by Board members and Company personnel. In addition, the Corporate Governance Committee may use a search firm to assist in the search for candidates and nominees and to evaluate the nominees’ skills against the Board’s criteria. Based on its review of all candidates, the Corporate Governance Committee recommends a slate of director nominees for election at the annual meeting of shareholders. The slate of nominees may include both incumbent and new nominees.

Potential candidates are reviewed and evaluated by the Corporate Governance Committee, and selected candidates go on to be interviewed by one or more Corporate Governance Committee members. An invitation to join the Board is extended by the Board itself, through the Chairman and the Chair of the Corporate Governance Committee.

During 2017, the Corporate Governance Committee screened director candidates and recommended to the Board that Robert C. Skaggs, Jr. be elected as a director. Mr. Skaggs was recommended as a potential candidate by an independent search firm. Mr. Skaggs was elected by the Board to serve for a term effective July 13, 2017 and expiring at the 2018 annual meeting.

Under our Bylaws, a group of up to 20 shareholders owning 3% or more of the Company’s outstanding common stock continuously for at least three (3) years may nominate and include in the Company’s proxy materials a



	DTE ENERGY 2018 PROXY STATEMENT 13

candidate for the Board of Directors (a Shareholder Nominee), provided that the shareholder(s) and the nominee satisfy the requirements specified in the Bylaws. The total number of Shareholder Nominees that the Company must include in the Company’s proxy materials in a given year shall not exceed 20% of the number of directors in office at the time of the nomination.

Composition of the Board

Our Governance Guidelines and our Bylaws state that the exact size of the Board will be determined by resolution of the Board from time to time. Our Board currently has thirteen members. As noted above, Charles W. Pryor, Jr.'s retirement will be effective as of May 3, 2018, at which time the size of the Board will be reduced to twelve.

Director Independence and Categorical Standards

As a matter of policy and in accordance with New York Stock Exchange (“NYSE”) listing standards, we believe that the Board should consist of a majority of independent directors. The Board must affirmatively determine that a director has no material relationship with the Company, either directly or indirectly, or as a partner, shareholder or officer of an organization that has a relationship with the Company. The Board has established the following categorical standards for director independence, which are more stringent than the NYSE independence standards for former Company executives:

A director for whom any of the following is true will not be considered independent:


•	A director who is currently, or has been at any time in the past, an employee of the Company or a subsidiary.


•	A director whose immediate family member is, or has been within the last three years, an executive officer of the Company.


•	A director who receives, or whose immediate family member receives, more than $120,000 in direct compensation from the Company during any twelve-month period within the last three years, other than director and committee fees and pension or other forms of deferred compensation for prior service (provided such compensation is not contingent in any way on continued service).

•

A director who is, or whose immediate family member is, a current partner of a firm that is the Company’s internal or external auditor; the director is a current employee of such a firm; the immediate family member is a current employee of such a firm and personally works on the Company’s audit; or the director or immediate family member was, within the last three years, a partner or employee of such a firm and personally worked on the Company’s audit within that time.


•	A director who is employed, or whose immediate family member is employed, or has been employed within the last three years, as an executive officer of another company where any of the Company’s present executives at the same time serves or served on that company’s compensation committee.

•

A director who is a current employee, or whose immediate family member is a current executive officer, of a company that has made payments to, or received payments from, the Company for property or services in an amount which, in any of the last three fiscal years, exceeds the greater of $1 million or 2% of such other company’s consolidated gross revenues is not independent until three years after the company falls below such threshold.

Contributions by the Company to a tax-exempt organization will not be considered to be a material relationship that would impair a director’s independence if a director serves as an executive officer of a tax-exempt organization and, within the preceding three years, contributions in any single fiscal year were less than $1 million or 2% (whichever is greater) of such tax-exempt organization’s consolidated gross revenues.

Applying these standards and considering all relevant facts and circumstances, the Board has affirmatively determined that all of our director nominees other than Gerard M. Anderson qualify as independent and have no material relationship with the Company. The independent directors are David A. Brandon, W. Frank Fountain, Jr., Charles G. McClure, Jr., Gail J. McGovern, Mark A. Murray, James B. Nicholson, Josue Robles, Jr., Ruth G. Shaw, Robert C. Skaggs, Jr., David A. Thomas and James H. Vandenberghe. Mr. Anderson is not an independent director and may be deemed to be an affiliate of the Company under the categorical standards. Mr. Anderson is not considered independent due to his current employment as Chairman and Chief Executive Officer. There were no material relationships that the Board considered when determining the independence of the directors other than Mr. Anderson.



14 DTE ENERGY 2018 PROXY STATEMENT

Assessment of Board and Committee Performance

The Board evaluates its performance annually. In addition, each Board committee performs an annual self-assessment to determine its effectiveness. Each Board member also performs an intensive annual peer review of every other director who has served one year or more. The results of the Board and committee self-assessments are discussed with the Board and each committee, respectively. The results of the individual peer review are reviewed by the Chair of the Corporate Governance Committee and discussed with the Corporate Governance Committee. The Chair of the Corporate Governance Committee discusses the results of the peer review with individual directors, as directed by the Corporate Governance Committee.

Terms of Office

The Board has not established term limits for directors. We assure the independence and ongoing effectiveness of each independent director through the individualized peer assessment process described above, in which each Board member annually undergoes a rigorous evaluation by the other members. In addition, the Corporate Governance Committee of the Board has established policies that independent directors should not stand for election after attaining the age of 75, unless the Board waives this provision when circumstances exist which make it prudent to continue the service of the particular independent director. Directors who are retired CEOs of the Company or its subsidiaries shall not stand for election after attaining the age of 70. Except for the CEO, who may continue to serve as a director after retirement for so long as he is serving as Chairman, any other employees who are also directors will not stand for re-election after retiring from employment with the Company.

Election of the Chairman and the CEO; Lead Independent Director

Our Bylaws currently provide that the Chairman may simultaneously serve as the CEO of the Company and shall preside at all meetings of the Board. Our Bylaws also provide that the independent members of the Board may elect an independent director as Lead Independent Director, which has been our practice since 2004.

The Board believes it is in the best interests of the Company and shareholders for the Board to have flexibility in determining whether to separate or combine the roles of Chairman and Chief Executive Officer based on the Company’s circumstances. The Board has strong governance structures and processes in place to ensure the independence of the Board, eliminate conflicts of interest and prevent dominance of the Board by senior management. The Governance Guidelines and various committee charters provide for independent discussion among directors and for independent evaluation of, and communication with, many members of senior management.

The Board members have considerable experience and knowledge regarding the challenges and opportunities facing the Company and shareholders. The Board believes, therefore, that separating the roles of Chairman and Chief Executive Officer is unnecessary at this time. The Board believes that Mr. Anderson is well qualified through his experience and expertise to be the person who generally sets the agenda for (subject to the approval of the Lead Independent Director) and leads Board discussions of strategic issues for the Company. Nevertheless, the Board will separate these functions when it considers the separation to be in the best interests of the Company and shareholders.

With both the Chairman and CEO positions held by Mr. Anderson, the Board continues to believe a good governance practice is to elect a Lead Independent Director from the independent directors. The Lead Independent Director will have such responsibilities as required under the NYSE listing standards, as well as such other responsibilities as determined by the Board. The Lead Independent Director serves in that capacity until replaced. There is no defined term of office, and the assignment does not rotate among the directors. On September 18, 2014, the Board unanimously elected James B. Nicholson to serve as Lead Independent Director. The Lead Independent Director’s duties include:


•	Calling regularly scheduled executive sessions; presiding at Board executive sessions of non-management directors or independent directors; and providing feedback regarding such sessions, as appropriate, to the Chairman and the CEO;


•	Serving as the liaison between the Chairman and CEO and the independent directors;


•	Approving the general scope and type of information to be presented at Board meetings;


•	Reviewing shareholder communications addressed to the Board or to the Lead Independent Director;



	DTE ENERGY 2018 PROXY STATEMENT 15


•	Making himself or herself available if requested by major shareholders, for direct consultation and communication with shareholders;


•	Organizing Board meetings in the absence of the Chairman; presiding at any session of the Board where the Chairman is not present;


•	Designating one or more directors as alternate members of any committee to replace an absent or disqualified member at any committee meeting, provided that, in the event an alternate member is designated for the Audit, Corporate Governance or Organization and Compensation Committee, the designate meets the Company’s categorical standards for director independence and SEC and NYSE requirements;


•	Consulting with the Chairman and CEO in the selection of topics to be discussed when developing the annual Board calendar;


•	Retaining independent advisors in consultation with the Board, on behalf of the Board as the Board determines to be necessary or appropriate;


•	Participating in the Organization and Compensation Committee’s annual review and approval of the CEO’s corporate goals and objectives and evaluation of the CEO’s performance;


•	Approving Board meeting agendas after consulting with the Chairman and CEO and the Corporate Secretary; and


•	Collaborating with the Chairman and CEO and the Corporate Secretary on scheduling Board and committee meetings and approving the schedule of Board and Committee meetings.

Board Meetings and Attendance

The Board met seven times in 2017. All of the incumbent directors attended at least 88% of the Board meetings and the meetings of the committees on which they served, nine of whom had a 100% attendance record. The Board does not have a policy with regard to directors’ attendance at the annual meeting of shareholders. All twelve directors then in office attended last year’s annual meeting.

Executive Sessions

It is the Board’s practice that the independent directors meet in executive session at most regular Board meetings and meet in executive session at other times whenever they believe it appropriate. The independent directors met in executive sessions (sessions without the Chairman and CEO or any representatives of management present) at six of the seven Board meetings in 2017. The independent directors meet in executive session on an annual basis to review the Organization and Compensation Committee’s performance review of the CEO. The Lead Independent Director chairs the executive sessions of the independent directors.

Codes of Business Conduct and Ethics

The DTE Energy Board of Directors Code of Business Conduct and Ethics, the Officer Code of Business Conduct and Ethics and the DTE Energy Way are the standards of behavior for Company directors, officers and employees. Any waiver of, or amendments to, the Board of Directors Code of Business Conduct and Ethics and the Officer Code of Business Conduct and Ethics as it pertains to the CEO, the Chief Financial Officer, senior financial officers and other Executive Officers, as defined in the “Security Ownership of Directors and Officers” section on page 26, will be disclosed promptly by posting such waivers or amendments on the Company website, dteenergy.com. There were no waivers or amendments during 2017.



16 DTE ENERGY 2018 PROXY STATEMENT

Communications with the Board

The Company has established several methods for shareholders or other non-affiliated persons to communicate their concerns to the directors. Concerns regarding auditing, accounting practices, internal controls, or other business ethics issues may be submitted to the Audit Committee through its reporting channel:



By telephone:	By Internet:	By mail:
877-406-9448	ethicsinaction.dteenergy.com	For auditing, accounting, or internal control matters:	For business ethics issues:
		DTE Energy Company	DTE Energy Company
		Audit Committee	Ethics and Employee Issues
		One Energy Plaza	One Energy Plaza
		Room 2431 WCB	Room 2188 WCB
		Detroit, Michigan 48226-1279	Detroit, Michigan 48226-1279

Any other concern may be submitted to the Corporate Secretary by mail for prompt delivery to the Lead Independent Director at:

Lead Independent Director

c/o Corporate Secretary

DTE Energy Company

One Energy Plaza

Room 2386 WCB

Detroit, Michigan 48226-1279

Periodically, we revise our governance information in response to changing regulatory requirements and evolving corporate governance developments. Current copies of the Governance Guidelines, committee charters, categorical standards of director independence and the codes of ethics referred to above are available on our website at dteenergy.com/governance. You can also request a copy of any or all of these documents and a copy of the Company’s Annual Report on Form 10-K, free of charge, by mailing your request to the Corporate Secretary, DTE Energy Company, One Energy Plaza, Room 2386 WCB, Detroit, Michigan 48226-1279.

The information on the Company’s website is not, and shall not be deemed to be, a part of this Proxy Statement or incorporated into any other filings the Company makes with the SEC.

Committees of the Board of Directors

The Board has standing committees for Audit, Corporate Governance, Finance, Nuclear Review, Organization and Compensation, and Public Policy and Responsibility. The Board committees act in an advisory capacity to the full Board, except that the Organization and Compensation Committee has direct responsibility for the CEO’s goals, performance and compensation along with compensation of other executives, and the Audit Committee has direct responsibility for appointing, replacing, compensating and overseeing the independent registered public accounting firm. Each committee has adopted a charter that clearly establishes the committee’s respective roles and responsibilities. In addition, each committee has authority to retain independent outside professional advisors or experts as it deems advisable or necessary, including the sole authority to retain and terminate any such advisors, to carry out its duties. The Board has determined that each member of the Audit, Corporate Governance, and Organization and Compensation Committees is independent under our categorical standards and that each member is free of any relationship that would interfere with his or her individual exercise of independent judgment. The Board has determined that each member of the Audit Committee meets the independence requirements under the SEC rules and NYSE listing standards applicable to audit committee members. The Board has also determined that each member of the Organization and Compensation Committee meets the independence requirements under the SEC rules and NYSE listing standards applicable to compensation committee members.



	DTE ENERGY 2018 PROXY STATEMENT 17

The following is a summary of the terms of each committee’s charter and the responsibilities of its members:

Audit Committee (Six meetings in 2017)


•	Assists the Board in its oversight of the quality and integrity of our accounting, auditing and financial reporting practices and the independence of the independent registered public accounting firm.


•	Reviews scope of the annual audit and the annual audit report of the independent registered public accounting firm.


•	Reviews financial reports, internal controls and financial and accounting risk exposures.


•	Discusses with management (a) earnings press releases and (b) material financial information and earnings guidance.


•	Reviews the policies, programs, performance and activities relating to the Company’s compliance and ethics programs.


•	Reviews accounting policies and system of internal controls.


•	Assumes responsibility for the appointment, replacement, compensation and oversight of the independent registered public accounting firm.


•	Reviews and pre-approves permitted non-audit functions performed by the independent registered public accounting firm.


•	Reviews the scope of work performed by the internal audit staff.


•	Reviews legal or regulatory requirements or proposals that may affect the committee’s duties or obligations.


•	Retains independent outside professional advisors, as needed.

The Board has determined that each member of the Audit Committee is financially literate and independent. The Board has reviewed the qualifications and experience of each of the Audit Committee members and determined that Gen. Robles and Messrs. Fountain and Vandenberghe qualify as “audit committee financial experts” as that term has been defined by the SEC.

Corporate Governance Committee (Five meetings in 2017)


•	Considers the organizational structure of the Board.


•	Identifies and reports to the Board risks associated with the Company’s governance practices and the interaction of the Company’s governance with enterprise risk management.


•	Recommends the nominees for directors to the Board.


•	Reviews recommended compensation arrangements for the Board, director and officer indemnification and insurance for the Board.


•	Reviews recommendations for director nominations received from shareholders.


•	Reviews shareholder proposals and makes recommendations to the Board regarding the Company’s response.


•	Reviews best practices in corporate governance and recommends corporate and Board policies/practices, as appropriate.


•	Retains independent outside professional advisors, as needed.

Finance Committee (Five meetings in 2017)


•	Reviews matters related to capital structure.


•	Reviews major financing plans.


•	Recommends dividend policy to the Board.


•	Reviews financial planning policies and investment strategy.


•	Reviews certain capital expenditures.


•	Reviews insurance and business risk management.


•	Receives reports on the strategy, investment policies, adequacy of funding and performance of post-retirement obligations.


•	Reviews certain potential mergers, acquisitions and divestitures.


•	Reviews investor relations activities.


•	Retains independent outside professional advisors, as needed.



18 DTE ENERGY 2018 PROXY STATEMENT

Nuclear Review Committee (Six meetings in 2017)


•	Provides non-management oversight and review of the Company’s nuclear power program.


•	Reviews the financial, operational and business and safety plans and performance at the Company’s nuclear facilities.


•	Reviews the policies, procedures and practices related to health and safety, potential risks, resources and compliance at the Company’s nuclear facilities.


•	Reviews the operating performance and key performance indicators and trends for the Company’s nuclear facilities.


•	Reviews non-financial audit findings related to the Company’s nuclear facilities or personnel.


•	Reviews the impact of changes in regulation on the Company’s nuclear facilities.


•	Retains independent outside professional advisors, as needed.

Organization and Compensation Committee (Four meetings in 2017)


•	Reviews the CEO’s performance and approves the CEO’s compensation.


•	Approves the compensation of certain other executives.


•	Administers the executive incentive plans and oversees the Company’s overall executive compensation and benefit plan philosophy, structure and practices, and the risks involved in executive compensation plans.


•	Reviews and approves executive employment agreements, severance agreements and change-in-control agreements, along with any amendments to those agreements.


•	Assesses and discusses with the Board the relationship between the inherent risk in executive compensation plans, executive compensation arrangements and executive performance goals and payouts, and how the level of risk corresponds to the Company’s business strategies.


•	Reviews the Compensation Disclosure and Analysis disclosure and recommends inclusion in the Company’s annual report or proxy statement.


•	Reviews the Company’s policies and programs promoting diversity and inclusion among the Company’s employees and officers.


•	Recommends to the full Board the officers to be elected by the Board.


•	Reviews succession and talent planning.


•	Retains independent outside professional advisors, as needed.


•	Evaluates the independence of the independent compensation consultant at least annually.


•	Reviews and discusses with management transactions with the independent compensation consultant or its affiliates.

Public Policy and Responsibility Committee (Five meetings in 2017)


•	Reviews and advises the Board on current and emerging social, economic, political and environmental issues.


•	Reviews management’s response to risk exposures related to regulatory, social, economic, political, reputational and environmental issues and advises the Board on management’s procedures for assessing, monitoring, controlling and reporting on such exposures.


•	Reviews the Company's programs and strategies related to environmental sustainability.


•	Reviews the Company’s policies on social responsibilities.


•	Reviews the Company’s policies and programs promoting diversity and inclusion among the Company’s suppliers.


•	Reviews the Company’s regulatory strategies and activities (including rate case strategies, rate competitiveness and environmental regulations) as well as its state and federal legislative and political activities and strategies.


•	Reviews reports from management regarding policies and safety issues related to customers and the general public.


•	Retains independent outside professional advisors, as needed.



	DTE ENERGY 2018 PROXY STATEMENT 19

Board of Directors Risk Oversight Functions

The Board receives, reviews and assesses reports from the Board committees and from management relating to enterprise-level risks. Each Board committee is responsible for overseeing and considering risk issues relating to their respective committee and reporting their assessments to the full Board at each regularly scheduled Board meeting. When granting authority to management, approving strategies and receiving management reports, the Board and committees consider, among other things, the risks we face.

Each Board committee reviews management’s assessment of risk for that committee’s respective area of responsibility. As part of its oversight function, the Board discusses any risk conflicts that may arise between the committees or assigns to a committee risk issues that may arise which do not fall within a specific committee’s responsibilities.



Board Committee		Areas of Risk Oversight
Audit Committee		Overall review of risk issues, policies and controls associated with our overall financial reporting and disclosure process and legal compliance, and review policies on risk control assessment and accounting risk exposure
Finance Committee		Review of financial, capital, credit and insurance risk.
Organization and Compensation Committee		Assess and discuss with the Board the relationship between the inherent risks in executive compensation plans, executive compensation arrangements and executive performance goals and payouts, and how the level of risk corresponds to the Company’s business strategies.
Corporate Governance Committee		Review risks associated with the Company’s governance practices and the interaction of the Company’s governance with enterprise risk-level management.
Nuclear Review Committee		Review risks relating to the operation of our nuclear power facilities.
Public Policy and Responsibility Committee		Review risks associated with regulatory, social responsibility, political activity, economic conditions, reputation, safety and the environment.

All Board committees meet periodically with members of senior management to discuss the relevant risks and challenges facing the Company. In addition to its regularly scheduled Committee meetings, the Audit Committee meets with the Chief Financial Officer, the General Auditor and Chief Risk Officer and the independent registered public accounting firm in executive sessions at least semi-annually, and meets with the General Counsel and the Chief Compliance Officer at least annually in separate executive sessions. The Company’s General Auditor and Chief Risk Officer attends all Audit Committee meetings and meets annually with either the Audit Committee or the full Board to update the members on the Company’s enterprise-level risk management. The General Auditor and Chief Risk Officer also periodically meets with the other Board committees and the full Board as may be required.

The Company also utilizes an internal Risk Management Committee, chaired by the Chairman and CEO and comprised of the Chief Operating Officer, Chief Financial Officer, Chief Administrative Officer, General Counsel, Treasurer, General Auditor and Chief Risk Officer and other senior officers. Among other things, the internal Risk Management Committee directs the development and maintenance of comprehensive risk management policies and procedures, and sets, reviews and monitors risk limits on a regular basis for enterprise-level risks, counter-party credit and commodity-based exposures.

The Board believes that the committee structure of risk oversight is in the best interests of the Company and its shareholders. Each committee member has expertise on risks relative to the nature of the committee on which he or she sits. With each committee reporting on risk issues at full Board meetings, the entire Board is in a position to assess the overall risk implications, to evaluate how they may affect the Company and to provide oversight on appropriate actions for management to take.

With regard to risk and compensation programs and policies, the Company’s Energy Trading segment has compensation programs and policies that are structured differently from those in other units within the Company. These compensation programs and policies are designed to discourage excessive risk taking by the Energy Trading employees and are subject to specific written policies and procedures administered by members of the Company’s senior management. The Company has determined that the Energy Trading compensation programs and policies do not create risks that are reasonably likely to have a material adverse effect on the Company.



20 DTE ENERGY 2018 PROXY STATEMENT

Board of Directors Compensation

Elements of Director Compensation

Employee directors receive no payment for service as directors. The goal of our compensation policies for non-employee directors is to tie their compensation to your interests as shareholders. Accordingly, approximately 50% of a director’s annual compensation is in the form of equity-based compensation, including phantom shares of our common stock. Generally, the compensation program for non-employee directors is reviewed on an annual basis by the Corporate Governance Committee and the Board. This review includes a review of a comparative peer group of companies that is identical to the peer group used to review executive compensation (See “Executive Compensation—Compensation Discussion and Analysis” beginning on page 38). Based on its December 2017 review, the Board made no modifications to the existing compensation program.



Cash Compensation
Cash retainer		$120,000 annually
Lead Independent Director retainer		$25,000 annually
Committee chair retainer		$20,000 annually for Audit Committee Chair; $15,000 annually for Corporate Governance, Finance, Nuclear Review, Organization and Compensation, and Public Policy and Responsibility Committee Chairs
New Member Orientation/Mentor Program		$1,250 and $750 quarterly for the New Member and Mentor, respectively, for the duration of the orientation
Equity Compensation
Upon first election to the Board		1,000 shares of restricted DTE Energy common stock
Annual equity compensation		A variable number of phantom shares of DTE Energy common stock valued at $130,000 annually, with the actual number of phantom shares to be granted each year determined based on the closing price of the Company’s common stock on the first business day of each calendar year(1)

(1)

Phantom shares of DTE Energy common stock are credited to each non-employee director’s account in January of each year. Phantom share accounts are also credited with dividend equivalents which are reinvested into additional phantom shares. For phantom shares granted after 2004, payment of the cash value is made three years after the date of grant unless otherwise deferred by voluntary election of the director. For phantom shares granted before 2005, payment of the cash value occurs only after the date a director terminates his or her service on the Board.

Payment of Non-Employee Director Fees and Expenses

Retainers for non-employee directors are either (i) payable in cash or (ii) at the election of the director, deferred into an account pursuant to the DTE Energy Company Plan for Deferring the Payment of Directors’ Fees. Non-employee directors may defer up to 100% of their annual retainer into an unfunded deferred compensation plan. Deferred fees may accrue for future payment, with interest accrued monthly at the 5-year U.S. Treasury Bond rate as of the last business day of each month or, at the election of the director, they may be invested in phantom shares of our common stock with all dividend equivalents reinvested.

In addition to the retainers, non-employee directors are reimbursed for their travel expenses incurred in attending Board and committee meetings, along with reimbursement for fees and expenses incurred when attending director education seminars or special meetings requested by management. Non-employee directors of the Company, along with full-time active employees and retirees, are also eligible to participate in the DTE Energy matching gift program, whereby the DTE Energy Foundation matches certain charitable contributions.



	DTE ENERGY 2018 PROXY STATEMENT 21

Director Life Insurance

The Company provides each non-employee director with group term life insurance in the amount of $20,000 and travel accident insurance in the amount of $100,000.

Director Stock Ownership

We have established stock ownership guidelines for non-employee directors to more closely tie their interests to those of shareholders. Under these guidelines, the Board requires that each director own shares of the Company’s common stock beginning no later than 30 days after election to the Board. In addition, directors are required to own, within five years after initial election to the Board, shares of Company stock having a value equal to two times the sum of a director’s annual cash retainer plus the value of a director’s annual phantom stock compensation. Based on the 2018 director compensation program, a director with five years of service will be required to hold a minimum of $500,000 in stock under these guidelines. This ownership requirement is greater than four times the amount of a director’s cash retainer under the 2018 compensation program. Common stock, time-based restricted stock and phantom shares held by a director are counted toward fulfillment of this ownership requirement. As of December 31, 2017, all directors met the initial common stock ownership requirement and all those directors who have served as a director for at least five years after their initial election have fulfilled the five-year requirement.



22 DTE ENERGY 2018 PROXY STATEMENT

2017 Director Compensation Table

The following table details the compensation earned in 2017 by each of the non-employee directors:



Name	Fees Earned or Paid in Cash ($)(1)	Stock Awards ($)(2)	All Other Compensation ($)(3)	Total ($)
David A. Brandon	135,000	130,000	305	265,305
W. Frank Fountain, Jr.	135,000	130,000	494	265,494
Charles G. McClure, Jr.	120,000	130,000	5,158	255,158
Gail J. McGovern	120,000	130,000	1,305	251,305
Mark A. Murray	120,000	130,000	6,158	256,148
James B. Nicholson	146,500	130,000	494	276,994
Charles W. Pryor, Jr. (retiring)	135,000	130,000	5,494	270,494
Josue Robles, Jr.	140,000	130,000	494	270,494
Ruth G. Shaw	135,000	130,000	5,494	270,494
Robert C. Skaggs, Jr.	58,600	104,890	66	163,556
David A. Thomas	120,000	130,000	158	250,158
James H. Vandenberghe	135,000	130,000	5,305	270,305


(1)	The following table provides a detailed breakdown of the fees earned or paid in cash:



	Fees Earned or Paid in Cash
Name	Board Retainer ($)	Lead Independent Director/Committee Chair Retainers ($)	New Member Orientation/Mentor Program Fees ($)	Total ($)
David A. Brandon	120,000	15,000	—	135,000
W. Frank Fountain, Jr.	120,000	15,000	—	135,000
Charles G. McClure, Jr.	120,000	—	—	120,000
Gail J. McGovern	120,000	—	—	120,000
Mark A. Murray	120,000	—	—	120,000
James B. Nicholson	120,000	25,000	1,500	146,500
Charles W. Pryor, Jr.	120,000	15,000	—	135,000
Josue Robles, Jr.	120,000	20,000	—	140,000
Ruth G. Shaw	120,000	15,000	—	135,000
Robert C. Skaggs, Jr.	56,100	—	2,500	58,600
David A. Thomas	120,000	—	—	120,000
James H. Vandenberghe	120,000	15,000	—	135,000

Messrs. Brandon and Vandenberghe elected to defer 100%, Messrs. McClure and Murray elected to defer 50%, and Mr. Nicholson elected to defer 40% of the fees detailed above into the DTE Energy Company Plan for Deferring the Payment of Directors’ Fees.



	DTE ENERGY 2018 PROXY STATEMENT 23

(2)

These amounts represent the dollar amounts of compensation cost for 2017 in accordance with ASC Topic 718 and, as such, include costs recognized in the financial statements with respect to phantom shares and shares of restricted stock granted. Because the phantom shares are 100% vested (with a mandatory three-year deferral) on the grant date, the ASC Topic 718 expense equals the grant date fair value as of January 3, 2017. The grant date fair value of $98.21 was the closing price of the Company stock on January 3, 2017. For all of the non-employee directors, this amount is $130,000 in phantom shares of DTE Energy stock granted on January 3, 2017, subject to a three-year payment deferral. Based on the grant date fair value of $98.21, this grant equated to a grant of 1,325 phantom shares. For Mr. Skaggs, this amount is the value of 1,000 shares of restricted stock granted on July 13, 2017. For this award, the grant date fair value of $104.89 was the closing price on July 13, 2017.

Outstanding equity awards as of December 31, 2017 are as follows:



Name	Phantom Shares in Equity Plan	Phantom Shares in Deferred Fee Plan	Restricted Stock
David A. Brandon	4,494	5,692	—
W. Frank Fountain, Jr.	21,456	13,032	—
Charles G. McClure, Jr.	4,494	589	—
Gail J. McGovern	28,922	—	—
Mark A. Murray	4,494	589	—
James B. Nicholson	8,227	5,175	—
Charles W. Pryor, Jr.	39,150	—	—
Josue Robles, Jr.	6,312	—	—
Ruth G. Shaw	4,494	—	—
Robert C. Skaggs, Jr.	—	—	1,000
David A. Thomas	4,494	—	—
James H. Vandenberghe	4,494	4,028	—


(3)	This amount is the total of the premiums paid for the group-term life insurance provided to the non-employee directors by the Company and all contributions made by the DTE Energy Foundation under the Company matching program.



24 DTE ENERGY 2018 PROXY STATEMENT

Information on Company Executive Officers

Under our Bylaws, the officers of DTE Energy are elected annually by the Board of Directors, each to serve until his/her successor is elected and qualified, or until his/her resignation or removal. The current executive officers of the Company elected by the Board are as follows:



Name	Age(1)	Present Position	Present Position Held Since
Gerard M. Anderson	59	Chairman of the Board and Chief Executive Officer	12/30/2013	(2)
Jeffrey A. Jewell	50	Vice President, Controller and Chief Accounting Officer	1/1/2018	(2)
Trevor F. Lauer	53	President and Chief Operating Officer, DTE Electric Company	4/4/2016	(2)
David E. Meador	60	Vice Chairman and Chief Administrative Officer	1/1/2014	(2)
Lisa A. Muschong	48	Vice President, Corporate Secretary and Chief of Staff	11/2/2015	(2)
Gerardo Norcia	55	President and Chief Operating Officer, DTE Energy Company	4/4/2016	(2)
Peter B. Oleksiak	51	Senior Vice President and Chief Financial Officer	1/1/2014	(2)
Bruce D. Peterson	61	Senior Vice President and General Counsel	6/25/2002
David Ruud	51	President-Power and Industrial	12/30/2013	(2)
David Slater	52	President-DTE Gas Storage and Pipelines	10/2/2014	(2)
Mark W. Stiers	55	President & Chief Operating Officer, DTE Gas Company	12/30/2013	(2)


(1)	As of March 8, 2018.


(2)	These executive officers have held various other positions at DTE Energy for five or more years.

Compensation Committee Interlocks and Insider Participation

During 2017, the Organization and Compensation Committee consisted of Dr. Shaw, Messrs. Brandon and Nicholson and Ms. McGovern. No member of the Organization and Compensation Committee serves as an officer or employee of the Company or any of its subsidiaries nor has any member of the Organization and Compensation Committee formerly served as an officer of the Company or any of its subsidiaries. During 2017, none of the executive officers of the Company served on the board of directors or on the compensation committee of any other entity, any of whose executive officers served either on the Board or on the Organization and Compensation Committee of the Company.

Indemnification and Liability

Pursuant to Article VI of our Articles of Incorporation, to the fullest extent permitted by law, no director of the Company shall be personally liable to the Company or its shareholders for any acts or omissions in the performance of his/her duties.

Article VII of our Articles of Incorporation provides that each person who is or was or had agreed to become a director or officer, or each person who is or was serving or who had agreed to serve at the request of the Board as an employee or agent of the Company, or as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise (including heirs, executors, administrators or estate of such person), shall be indemnified by the Company to the fullest extent permitted by law. We have entered into indemnification agreements with each of our directors and executive officers. These agreements require the Company to indemnify such individuals for certain liabilities to which they may become subject as a result of their affiliation with the Company.

The Company, the directors and officers in their capacities as such are insured against liability for alleged wrongful acts (to the extent defined) under twelve insurance policies providing aggregate coverage in the amount of $255 million.



	DTE ENERGY 2018 PROXY STATEMENT 25

Security Ownership of Directors and Officers

The following table sets forth information as of December 31, 2017, with respect to beneficial ownership of common stock, phantom stock, performance shares and options exercisable within 60 days for (i) each of our directors and nominees for director, (ii) our Chairman and Chief Executive Officer, Senior Vice President and Chief Financial Officer and the three other highest paid executive officers (together, the “Named Executive Officers”), and (iii) all executive officers and directors as a group. Executive officers for this purpose are those individuals defined as executive officers under Rule 16a-1(f) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). Unless otherwise indicated, each of the named individuals has sole voting and/or investment power over the shares identified. To our knowledge, no member of our management team or director was a beneficial owner of one percent or more of the outstanding shares of common stock as of December 31, 2017.

Amount and Nature of Beneficial Ownership as of December 31, 2017



Name of Beneficial Owners	Common Stock(1)	Phantom Stock(2)	Options Exercisable Within 60 Days	Other Shares That May Be Acquired(3)
Gerard M. Anderson	490,175	12,971	80,000	178,592
David A. Brandon	1,000	10,186	—	—
W. Frank Fountain, Jr.	1,000	34,488	—	—
Charles G. McClure, Jr.	1,000	5,083	—	—
Gail J. McGovern	—	28,922	—	—
Mark A. Murray	1,000	5,083	—	—
James B. Nicholson	4,200	13,402	—	—
Charles W. Pryor, Jr.	300	39,150	—	—
Josue Robles, Jr.	1,000	6,312	—	—
Ruth G. Shaw	3,500	4,494	—	—
Robert C. Skaggs, Jr.	1,000	—	—	—
David A. Thomas	1,673	4,494	—	—
James H. Vandenberghe	2,000	8,522	—	—
Steven E. Kurmas (4)	105,869	1,724	—	44,724
David E. Meador	137,697	—	—	41,556
Gerardo Norcia	115,930	1,287	—	47,397
Peter B. Oleksiak	46,431	—	—	31,889
Directors and Executive Officers as a group —24 persons	1,052,741	178,234	80,000	429,570


(1)	Includes directly held common stock, restricted stock and shares held pursuant to the DTE Energy Company Savings and Stock Ownership Plan (tax-qualified 401(k) plan).

(2)

Shares of phantom stock are acquired as follows: (a) by non-employee directors (i) as compensation under the DTE Energy Company Deferred Stock Compensation Plan for Non-Employee Directors and (ii) through participation in the DTE Energy Company Plan for Deferring the Payment of Directors’ Fees and (b) by executive officers pursuant to the (i) DTE Energy Company Supplemental Savings Plan, (ii) DTE Energy Company Executive Deferred Compensation Plan (this plan was closed effective as of January 1, 2007 for future deferrals; none of the Named Executive Officers participate in the plan) and (iii) DTE Energy Company Executive Supplemental Retirement Plan. Shares of phantom stock may be paid out in either cash or stock.



26 DTE ENERGY 2018 PROXY STATEMENT

(3)

Represents performance shares under the Long-Term Incentive Plan (as described beginning on page 50) that entitle the executive officers to receive shares or cash equivalents (or a combination thereof) in the future if certain performance measures are met. The performance share numbers assume that target levels of performance are achieved. The number of performance shares reflected in the table includes an increase from the original grant amount, assuming full dividend reinvestment at the fair market value on the dividend payment date. Performance shares are not currently outstanding shares of our common stock and are subject to forfeiture if the performance measures are not achieved over a designated period of time. Executive officers do not have voting or investment power over the performance shares until performance measures are achieved. See the discussion in “Long-Term Incentives - Performance Shares Granted in 2017” beginning on page 50.


(4)	Mr. Kurmas retired effective February 1, 2018.

Prohibition on Pledging and Hedging Company Securities

The Company maintains policies which expressly prohibit hedging Company securities by all employees, executive officers and directors of the Company and its subsidiaries. For purposes of these policies, hedging includes purchases and sales of derivatives based upon Company securities. Our directors and officers are also prohibited from pledging their shares of Company stock as collateral for any loan or indebtedness. This prohibition includes, but is not limited to, holding such shares in a margin account.

Section 16(a) Beneficial Ownership Reporting Compliance

Section 16(a) of the Exchange Act requires our directors, executive officers and certain 10% shareholders (if any) to file reports of ownership and changes in ownership with respect to our securities with the SEC and to furnish copies of these reports to us. We reviewed the filed reports and written representations from our directors and executive officers regarding the necessity of filing reports.

Based upon our review, all of our current executive officers’ and directors’ required Section 16 filings during 2017 were filed on a timely basis.

Security Ownership of Certain Beneficial Owners

The following table sets forth information regarding the only persons or groups known to the Company to be beneficial owners of more than 5% of our outstanding common stock.



Title of Class	Name and Address of Beneficial Owner	Amount and Nature of Beneficial Ownership		Percent of Class
Common Stock	The Vanguard Group, Inc. 100 Vanguard Blvd. Malvern, Pennsylvania 19355	19,053,100	(1)	10.6	%
Common Stock	BlackRock, Inc. 55 East 52nd Street New York, New York 10055	15,036,122	(2)	8.4	%
Common Stock	Capital World Investors 333 South Hope Street Los Angeles, California 90071	9,873,095	(3)	5.4	%
Common Stock	State Street Corporation One Lincoln Street Boston, Massachusetts 02111	9,035,835	(4)	5.0	%



	DTE ENERGY 2018 PROXY STATEMENT 27

(1)

Based on information contained in Schedule 13G/A filed on February 9, 2018. Shares listed as beneficially owned by Vanguard are owned by the following entities: The Vanguard Fiduciary Trust Company, Vanguard Investments Australia, Ltd. and The Vanguard Group, Inc. The Vanguard Group, Inc. has sole voting power with respect to 276,121 shares, sole dispositive power with respect to 18,717,115 shares, shared dispositive power with respect to 335,985 shares and is deemed to beneficially own 19,053,100 shares.

(2)

Based on information contained in Schedule 13G/A filed on January 29, 2018. Shares listed as beneficially owned by BlackRock are owned by the following entities: BlackRock Advisors, LLC, BlackRock Financial Management, Inc., BlackRock Investment Management, LLC, BlackRock Investment Management (Australia) Limited, BlackRock (Luxembourg) S.A., BlackRock (Netherlands) B.V., Black Rock (Singapore) Limited, BlackRock Fund Managers Ltd, BlackRock Life Limited, BlackRock Asset Management Canada Limited, BlackRock Asset Management Deutschland AG, BlackRock Asset Management Ireland Limited, BlackRock Asset Management North Asia Limited, BlackRock Asset Management Schweiz AG, BlackRock Capital Management, Inc., BlackRock Advisors (UK) Limited, BlackRock Fund Advisors, BlackRock International Limited, BlackRock Institutional Trust Company, National Association, BlackRock Japan Co., Ltd, BlackRock Investment Management (UK) Limited, iShares (DE) I Investmentaktiengesellschaft mit Teilgesellschaftsvermogen. BlackRock Inc. has sole dispositive power with respect to 15,036,122 shares, sole voting power with respect to 13,524,575 shares, and is deemed to beneficially own 15,036,122 shares.


(3)	Based on information contained in Schedule 13G filed on February 14, 2018. Capital World Investors has sole dispositive power with respect to 9,873,095 shares, sole voting power with respect to 9,873,095 shares, and is deemed to beneficially own 9,873,095 shares.

(4)

Based on information contained in Schedule 13G filed on February 14, 2018. Shares listed as beneficially owned by State Street are owned by the following entities: State Street Bank and Trust Company, SSGA Funds Management, Inc., State Street Global Advisor Trust Company, State Street Global Advisors, Australia, State Street Global Advisors (Asia) LTD., State Street Global Advisors (Japan) Co., LTD.,State Street Global Advisors France, S.A.S., State Street Global Advisors Singapore LTD., State Street Global Advisors Limited, and State Street Global Advisors GmbH. State Street Corporation has shared voting power with respect to 9,035,835 shares, shared dispositive power with respect to 9,035,835 shares, and is deemed to beneficially own 9,035,835 shares.

Certain Relationships and Related Transactions

Related-person transactions have the potential to create actual or perceived conflicts of interest. The Company has policies in place to address related-party transactions. In addition, our Corporate Governance Committee and Audit Committee review potential dealings or transactions with related parties. In conducting such reviews, the committees consider various factors they deem appropriate, which may include (i) the identity of the related party and his or her relationship to the Company, (ii) the nature and size of the transaction, including whether it involved the provision of goods or services to the Company that are unavailable from unrelated third parties and whether the transaction is on terms that are comparable to the terms available from unrelated third parties, (iii) the nature and size of the related party’s interest in the transaction, (iv) the benefits to the Company of the transaction and (v) whether the transaction could involve an apparent or actual conflict of interest with the Company.

In general, employees and directors may not be involved in a business transaction where there is a conflict of interest with the Company. The DTE Energy Way requires non-officer employees to report conflicts of interest or potential conflicts of interest to their respective superiors; the Officer Code of Conduct and Ethics requires officers to report conflicts of interest or potential conflicts of interest to the Company’s General Counsel or to the Company’s Board of Directors; and the Board of Directors Code of Business Conduct and Ethics requires directors to disclose conflicts of interest or potential conflicts of interest to the Company’s Corporate Governance Committee or the Chairman of the Board. For directors and officers, any waivers of the Company’s conflict of interest policy must be approved by the Board or a Board committee, as required under the Officer Code of Conduct and Ethics or Board of Directors Code of Business Conduct and Ethics, disclosed to shareholders and posted to our website at dteenergy.com/ethics.



28 DTE ENERGY 2018 PROXY STATEMENT

Proposal No. 2 — Ratification of Appointment of Independent Registered Public Accounting Firm

Subject to ratification by the shareholders, the Audit Committee has appointed PricewaterhouseCoopers LLP (“PwC”) as our independent registered public accounting firm to audit our consolidated financial statements for the fiscal year ending December 31, 2018 and to perform other audit-related services. Following the Audit Committee’s appointment, the Board voted unanimously to recommend that our shareholders vote to ratify the Audit Committee’s selection of PwC as our independent auditors for 2018.

The reports of PwC on the consolidated financial statements of DTE Energy for the year ended December 31, 2017 and for the year ended December 31, 2016 did not contain adverse opinions or a disclaimer of opinions and were not qualified or modified as to uncertainty, audit scope or accounting principles.

During the Company’s two most recent fiscal years, ended December 31, 2017 and 2016, and from January 1, 2018 through February 16, 2018, there were no disagreements with PwC on any matter of accounting principles or practices, financial statement disclosure or auditing scope or procedure, which disagreements, if not resolved to PwC’s satisfaction, would have caused PwC to make reference to the subject matter of such disagreements in connection with its reports on the Company’s consolidated financial statements for such years.

During the Company’s two most recent fiscal years, ended December 31, 2017 and 2016 and from January 1, 2018 through February 16, 2018, there were no “reportable events” as defined under Item 304(a)(1)(v) of Regulation S-K.

Representatives of PwC will be present at the annual meeting and will be afforded an opportunity to make a statement, if they desire, and to respond to appropriate questions from shareholders.

Fees to the Independent Registered Public Accounting Firm

The following table presents fees for professional services rendered by PwC for the audit of the Company’s consolidated annual financial statements for the years ended December 31, 2017 and December 31, 2016, and fees billed for other services rendered by PwC during those periods.



	2017		2016
Audit fees(1)	$	7,501,916	$	6,670,406
Audit related fees(2)	390,092		1,280,053
Tax fees(3)	282,240		248,484
All other fees(4)	3,003,472		1,179,766
Total	$	11,177,720	$	9,378,709

(1)

Represents fees for professional services performed by PwC for the audits of the Company’s consolidated annual financial statements included in the Company’s Form 10-K, review and audit of the Company’s internal control over financial reporting, the review of consolidated financial statements included in the Company’s Form 10-Q filings, and services that are normally provided in connection with regulatory filings or engagements. Audit fees are presented on an Audit Year basis in accordance with SEC guidelines and include an estimate of fees incurred for the most recent Audit Year.


(2)	Represents the aggregate fees billed for audit-related services and various attest services.


(3)	Represents fees billed for tax services, including tax reviews and planning.


(4)	Represents consulting services for the purpose of providing advice and recommendations.

Policy on Audit Committee Pre-Approval of Audit and Permissible Non-Audit Services of Independent Registered Public Accounting Firm

Consistent with SEC policies regarding the independence of the registered public accounting firm, the Audit Committee is responsible for appointing, approving professional service fees of, and overseeing the work of the independent registered public accounting firm. The Audit Committee has established a policy regarding pre-approval of all audit and permissible non-audit services provided by the independent registered public accounting firm.



	DTE ENERGY 2018 PROXY STATEMENT 29

Prior to engaging the independent registered public accounting firm to perform specific services, the Audit Committee pre-approves these services by category of service. The Audit Committee may delegate to the Chair of the Audit Committee, or to one or more other designated members of the Audit Committee, the authority to grant pre-approvals of all permitted services or classes of these permitted services to be provided by the independent registered public accounting firm up to, but not exceeding, a pre-defined limit. The decisions of the designated member to pre-approve a permitted service are reported to the Audit Committee at each scheduled meeting. At least quarterly, the Audit Committee reviews:


•	A report summarizing the services, or groupings of related services, including fees, provided by the independent registered public accounting firm.


•	A listing of new services requiring pre-approval, if any.


•	As appropriate, an updated projection for the current fiscal year, presented in a manner consistent with the proxy disclosure requirements, of the estimated annual fees to be paid to the independent registered public accounting firm.

All audit, audit-related, tax and other services performed by PwC were pre-approved by the Audit Committee in accordance with the regulations of the SEC. The Audit Committee considered and determined that the provision of the non-audit services by PwC during 2017 was compatible with maintaining independence of the registered public accounting firm.



30 DTE ENERGY 2018 PROXY STATEMENT

Report of the Audit Committee

The purpose of the Audit Committee is to assist the Board’s oversight of the integrity of the Company’s consolidated financial statements, the Company’s compliance with legal and regulatory requirements, the Company’s independent registered public accounting firm’s qualifications and independence and the performance of the Company’s internal audit function. All members of the Audit Committee meet the criteria for independence as defined in our categorical standards and the audit committee independence requirements under the SEC rules. The Audit Committee Charter also complies with requirements of the NYSE.

Management is responsible for the financial reporting process, including the system of internal controls, and for the preparation of consolidated financial statements in accordance with accounting principles generally accepted in the United States of America (“GAAP”). Management is also responsible for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting. The independent registered public accounting firm is responsible for auditing these consolidated financial statements and expressing an opinion as to their conformity with GAAP. The independent registered public accounting firm is also responsible for expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. The Audit Committee’s responsibility is to monitor and review these processes, acting in an oversight capacity, and the Audit Committee does not certify the consolidated financial statements or internal control over financial reporting or guarantee the independent registered public accounting firm’s reports. The Audit Committee relies, without independent verification, on the information provided to it including representations made by management and the reports of the independent registered public accounting firm.

The Audit Committee discussed with PwC the matters required to be discussed by audit standards, SEC regulations and NYSE requirements. Disclosures were received from PwC regarding its independence as required by applicable requirements of the Public Company Accounting Oversight Board and discussed with them. The Audit Committee has considered whether the services provided by PwC other than those services relating to audit services are compatible with maintaining PwC’s independence. The Audit Committee has concluded that such services have not impaired PwC’s independence. The Audit Committee reviewed and discussed the audited consolidated financial statements for the year ended December 31, 2017 with management and PwC. Based on the review and discussions noted above, the Audit Committee recommended to the Board that the audited consolidated financial statements be included in the Company’s Annual Report on Form 10-K filed with the SEC for the fiscal year ended December 31, 2017. The Audit Committee reviewed and discussed Management’s Report on Internal Control over Financial Reporting as of December 31, 2017 with management and PwC. Based on the review and discussions noted above, the Audit Committee recommended to the Board that Management’s Report on Internal Control over Financial Reporting as of December 31, 2017 be included in the Company’s Annual Report on Form 10-K filed with the SEC for the fiscal year ended December 31, 2017.

Audit Committee

Josue Robles, Jr., Chair

W. Frank Fountain, Jr.

Charles G. McClure, Jr.

James H. Vandenberghe

THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR THE PROPOSAL TO RATIFY THE APPOINTMENT OF THE INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM.



	DTE ENERGY 2018 PROXY STATEMENT 31

Proposal No. 3 — Advisory Proposal — Nonbinding Vote to Approve Executive Compensation

The Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 (the “Dodd-Frank Act”) requires the Company to provide shareholders with an opportunity to vote to approve, on an advisory basis, the compensation of our Named Executive Officers as described in the “Compensation Discussion and Analysis” (“CD&A”) section of this proxy statement and in the tabular and narrative disclosure regarding Named Executive Officer compensation, all contained under the heading “Executive Compensation” in this proxy statement.

The Company’s executive compensation program is designed to include elements of cash and equity-based compensation to motivate and reward executives who achieve short-term and long-term corporate and financial objectives leading to the success of the Company. We emphasize competitive, performance-based compensation to attract and retain talented executives and align the interests of our executives with those of our shareholders. At each of the 2017 and 2016 annual meetings, 94.8% and 96.2%, respectively, of voting shareholders approved the compensation of the Named Executive Officers.

Shareholders have in the past approved the incentive plans that we use to motivate and reward our executives, including the Annual Incentive Plan, the Long-Term Incentive Plan and the Executive Performance Plan. In addition, the Company has enhanced our disclosures related to executive compensation to provide more detail to our shareholders about our compensation programs, including expanded disclosures relating to these plans in this Proxy Statement.

Our executive compensation programs have been important in driving the Company’s success in achieving its corporate and financial objectives by tying executive compensation to achieving very specific goals in each of our key priority areas. Progress against these objectives is necessary for the Company to achieve its ultimate goal of becoming the best-operated energy company in North America. We explain each of our performance targets and measures in detail in our CD&A, but a few examples of Company success in areas related to our targets and measures include the following:


•	Achieved 7.2% compound operating earnings per share growth during the five years ending 2017 (see discussion of operating earnings on page 47).


•	Increased our dividend payment to an annualized rate of $3.30 per share in 2017, representing a 7.1% increase over the annualized dividend rate in 2016.


•	Provided our shareholders with a five-year total shareholder return of 216% (indexed with 2012 as the base year = 100%).


•	Delivered cash from operations of $2.1 billion in 2017.


•	Achieved Highest Customer Satisfaction award in the Midwest from J.D. Power for both electric and gas business customers.


•	Received Gallup Great Workplace Award for the fifth consecutive year.


•	Announced a broad sustainability initiative that will reduce our carbon emissions by more than 80 percent by 2050. More information on our sustainability efforts can be found at dteenergy.com/esg.

Each of these accomplishments is related to a specific performance goal in our short- or long-term compensation programs, which in turn support the Company’s aspiration of becoming the best-operated energy company in North America.

The Organization and Compensation Committee (“O&C Committee”) employs the highest standards of corporate governance when implementing and reviewing our executive compensation programs. These high standards are evidenced in part by the O&C Committee’s and Board’s 2015 adoption of amendments to the Executive Performance Plan to cap individual officer awards and amending the Long-Term Incentive Plan to eliminate single-trigger vesting upon certain changes in control of the Company. Both of these changes were responsive to shareholder feedback and in keeping with industry standards. The O&C Committee ensures independence of committee members and compensation consultants, avoids conflicts of interest and has enhanced shareholder disclosure in accordance with SEC and NYSE requirements.

For these reasons, the Board recommends that shareholders vote in favor of the following resolution:



32 DTE ENERGY 2018 PROXY STATEMENT

“RESOLVED, that the shareholders approve, on an advisory basis, the overall executive compensation paid to the Named Executive Officers of the Company, as described in the Compensation Discussion and Analysis and the tabular and narrative disclosure regarding Named Executive Officer compensation contained in this proxy statement.”

Because this vote is advisory, it will not be binding upon the Company or the Board. The O&C Committee will take into account the outcome of the vote when considering future executive compensation arrangements.

THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR THE PROPOSAL

TO APPROVE EXECUTIVE COMPENSATION.



	DTE ENERGY 2018 PROXY STATEMENT 33

Proposal No. 4 — Management Proposal — Approval of an Amendment and Restatement of the DTE Energy Company Long-Term Incentive Plan

The Board is seeking shareholder approval of the amendment and restatement of the DTE Energy Company Long-Term Incentive Plan ("LTIP"). In 2006, the Board adopted the LTIP and our shareholders approved the LTIP on April 27, 2006. At the 2010, 2012 and 2014 shareholder meetings, shareholders overwhelmingly approved amendments to the LTIP. At its December 2017 meeting, the Board approved a restatement of the LTIP that includes two amendments to the LTIP, one of which requires shareholder approval.

The amendment included in the LTIP restatement which the Board asks shareholders to approve will increase the aggregate number of shares of common stock that may be issued or acquired and delivered under the LTIP pursuant to the exercise of options, the grant of stock awards and the settlement of performance shares and performance units by 2,000,000 to 16,500,000. It is anticipated the share increase will ensure the plan has sufficient shares authorized to satisfy the needs of the plan through the end of 2021.

The Board proposes that shareholders approve the amendment to enable the Company to continue to offer the incentives necessary to attract and retain the employees needed to support the Company’s future growth and success and align the long-term interests of employees with those of the shareholders. Without the additional shares, the Company would be unable to attract and retain the most qualified employees.

The amendment included in the restatement approved by the Board at the December 2017 meeting which does not require shareholder approval allows tax withholding above the statutory minimum.

The following summarizes the material provisions of the LTIP, assuming the amendment and restatement described above is approved by the shareholders by an affirmative vote of a majority of the votes cast. The summary is qualified in its entirety by reference to the full conformed text of the amended and restated LTIP, which is attached as Exhibit A to this Proxy Statement.

Material Terms of the Amendment to the LTIP:

If this proposal is passed, Section 5.02(a) of the LTIP will be amended to provide that the maximum aggregate number of shares of DTE Energy Company common stock that may be issued or acquired and delivered under the LTIP pursuant to the exercise of options, the grant of stock awards and the settlement of performance shares and performance units is increased from 14,500,000 to 16,500,000, subject to adjustment in the event of certain changes in capitalization or other corporate transactions.

Material Terms of the LTIP (as amended):

Participants: Any employee of DTE Energy or an entity in which DTE Energy has a direct or indirect ownership or other equity interest ("Subsidiary") and any member of the Board, whether or not employed by DTE Energy or a Subsidiary, is eligible to participate if the plan administrator determines that the employee or director has contributed significantly, or may be expected to contribute significantly, to the profits or growth of DTE Energy or a Subsidiary. An eligible employee or director becomes a participant if he or she is selected to receive a LTIP award by the plan administrator.

Plan Administration: The Board administers the LTIP with respect to awards made to members of the Board who are not employees of DTE Energy or a Subsidiary. The Organization and Compensation Committee administers the LTIP with respect to awards made to employees of DTE Energy or a Subsidiary. The Committee may delegate to the CEO, and in certain instances, to the President, all or part of its authority and duties as to awards made to individuals not subject to Section 16 of the Exchange Act. References in this summary to the "plan administrator" include references to the Organization and Compensation Committee, any other committee appointed in its place, the CEO or President of DTE Energy or the Board, as the context requires.

The plan administrator has the authority to determine the persons to whom awards will be made; to select the type, size and timing of each award; to set the terms and provisions of each award, consistent with the



34 DTE ENERGY 2018 PROXY STATEMENT

provisions of the LTIP; and to establish rules and policies for the plan. The plan administrator may amend the provisions of existing award agreements when it deems appropriate. The plan administrator may not, however, grant to any participant in a single calendar year:(1) options for more than 500,000 shares of common stock; (2) stock awards for more than 150,000 shares of common stock; (3) performance share awards for more than 300,000 shares of common stock (based on the maximum payout under the award); or (4) more than 1,000,000 performance units, which have a face amount of $1.00 each.

Aggregate Number of Plan Shares: The maximum aggregate number of shares of DTE Energy common stock that may be issued or acquired and delivered under the LTIP pursuant to the exercise of options, the grant of stock awards and the settlement of performance shares and performance units is 16,500,000, subject to adjustment in the event of certain changes in capitalization or other corporate transactions. Of this total, the aggregate limit of awards to non-employee directors is 100,000 shares. It is anticipated that the plan would have sufficient shares to satisfy the needs of the plan through the end of 2021. If (i) an option is terminated, in whole or part, for any reason other than its exercise for shares of common stock; or (ii) a stock award is forfeited, in whole or in part; or (iii) an award of performance shares or performance units is terminated, in whole or in part for any reason other than its settlement in shares of common stock or cash, the number of shares subject to the terminated or forfeited portion of the award may be reallocated to other options,

performance shares, performance units and stock awards, subject to the limits described above. Reallocation of shares shall not be permitted for shares repurchased by stock option proceeds, shares tendered in payment of an exercise price or shares tendered or withheld by the Company in satisfaction of tax obligations. As of December 31, 2017, there were approximately 1,690,165 shares subject to outstanding awards granted under the plan, and approximately 1,437,769 shares remained available for issuance under the LTIP (not including the share increase reflected in the amended and restated version of the LTIP). The closing price of a share of the Company's common stock on February 28, 2018 was $100.78.

Stock Option Awards: Each stock option granted pursuant to the LTIP is evidenced by a written stock option agreement between the Company and the optionee. The option price will be fixed by the plan administrator but cannot be less than the Fair Market Value of DTE Energy common stock on the date of grant of the option. The option price may be paid in cash, cash equivalent acceptable to the plan administrator, or with unrestricted shares of DTE Energy common stock. The maximum period in which an option may be exercised will be fixed by the plan administrator on the date of grant, but cannot exceed ten years from the date of grant. The plan administrator also establishes, on the date of grant, the terms on which the option may be exercised and the consequences of termination of employment. Options granted under the LTIP may be either non-qualified options or incentive stock options. The plan administrator may not permit the exercise of any option earlier than one year after the date of the grant. Generally, one-third of the options covered by a single grant are

exercisable one, two and three years after the date of the grant.

The federal income tax consequences of the two types of options differ, as described below. No federal income tax is recognized by a participant at the time an option is granted. If the option is an incentive stock option, no income will be recognized upon the participant’s exercise of the option. Income is recognized by a participant when he or she disposes of shares acquired under an incentive stock option. The exercise of a non-qualified stock option is a taxable event that requires the participant to recognize, as ordinary income, the difference between the shares’ fair market value and the option price. Except to the extent limited by Section 162(m) (see discussion on page 45), the employer (either DTE Energy or a Subsidiary) will be entitled to claim a federal income tax deduction on account of the exercise of a non-qualified option equal to the amount of ordinary income recognized by the participant. The employer will not be entitled to a federal income tax deduction on account of the grant or exercise of an incentive stock option, but may claim a federal income tax deduction on account of certain dispositions of DTE Energy common stock acquired on exercise of an incentive stock option. The LTIP prohibits, without prior shareholder approval, (1) reducing the option price of an outstanding option, (2) canceling any options and replacing them with new awards having a lower option price (where the economic effect would be the same as reducing the option price) and (3) at any time when the price of a previously granted option is above the Fair Market Value of one share of DTE Energy common stock, the making of any offer by the plan administrator to purchase the previously granted option for a cash payment in substitution for or upon the cancellation of the option.

Stock Awards: Awards of Company stock may be granted, and may be forfeitable or subject to certain restrictions on transfer, or both, unless conditions prescribed by the plan administrator on the date of grant are satisfied. The conditions may include a requirement that the participant continue employment with DTE Energy or that stated performance objectives be achieved. Rights to stock awards cannot become non-forfeitable or



	DTE ENERGY 2018 PROXY STATEMENT 35

unrestricted earlier than three years after the date of the award, except in limited special circumstances, including awards to new hires and participants expected to retire within three years, when stock awards can provide that the award will become non-forfeitable or unrestricted earlier than three years after the date of the award but in no event earlier than one year after the date of the award. The participant generally is entitled to vote and receive dividend equivalents on the stock award prior to the time the shares become non-forfeitable or transferable. A participant recognizes ordinary income on the first day that the shares subject to the stock

award are either transferable or not subject to a substantial risk of forfeiture. The amount of income recognized equals the fair market value of the shares on that date. Except to the extent limited by Section 162(m) (see discussion on page 45), the participant’s employer is entitled to a Federal income tax deduction equal to the ordinary income recognized by the participant.

Performance Share Awards: Performance share awards entitle the participant to receive a specified number of shares of DTE Energy common stock. Once earned, a performance share award may be settled in shares of DTE Energy common stock, cash or a combination of the two, in the plan administrator's discretion. The plan administrator may prescribe that performance shares will be earned only on satisfaction of performance objectives during a performance measurement period of at least one year or upon satisfaction of other requirements. The plan administrator may also specify the consequences of termination of employment. Rights in performance shares may not become non-forfeitable earlier than one year after the date of the award. Settlement will occur at the time specified by the plan administrator. A participant recognizes ordinary income on the settlement of a performance share award equal to any cash that is paid and the fair market value of common stock (on the date the shares are first transferable or not subject to a substantial risk of forfeiture) that is received in settlement of the award. Except to the extent limited by Section 162(m) (see discussion on page 45), the participant’s employer is entitled to a Federal income tax deduction equal to the amount of ordinary income recognized by the participant. All agreements awarding performance shares provide that dividend equivalents with respect to the award will not be paid before the performance shares are earned and vested. During the period beginning on the date the performance shares are awarded and ending on the certification date of the performance objectives, the number of performance shares awarded will be increased, assuming full dividend reinvestment at the Fair Market Value (as defined in the LTIP) on the dividend payment date. The cumulative number of performance shares will be adjusted to determine the final payment based on the performance objectives as certified by the O&C Committee. The final adjusted number of performance shares will be paid as provided in the LTIP.

Performance Unit Awards: A performance unit award entitles the participant to receive a payment equal to $1.00 per performance unit if certain standards are met. The plan administrator will prescribe the performance objectives and other requirements that must be satisfied before a performance unit is earned and specify the consequences of termination of employment. Performance units may not become non-forfeitable earlier than one year after the date of the award. The period in which performance is measured will be at least one year. To the extent that performance units are earned, the obligation may be settled in cash, DTE Energy common stock, or a combination of the two, in the plan administrator's discretion. A participant recognizes ordinary income on the settlement of a performance unit award equal to any cash that is paid and the fair market value of common stock (on the date the shares are first transferable or not subject to a substantial risk of forfeiture) that is received in settlement of the award. Except to the extent limited by Section 162(m) (see discussion on page 45), the participant’s employer is entitled to a Federal income tax deduction equal to the amount of ordinary income recognized by the participant.

Performance Objectives: Vesting, settlement or exercise of an award made under the LTIP may be conditioned upon the achievement of specified performance objectives by DTE Energy, a Subsidiary, or a division of DTE Energy or a Subsidiary. The performance objectives may be stated with respect to (i) shareholder value growth based on stock price and dividends, (ii) customer price, (iii) customer satisfaction, (iv) growth based on increasing sales or profitability of one or more business units, (v) performance against the companies in the Dow Jones Electric Utility Industry Group ("DJEUIG") index, the companies in the S&P 500 Electric Utility Industry index, a peer group or similar benchmark selected by the Organization and Compensation Committee, (vi) earnings per share growth, (vii) employee satisfaction, (viii) nuclear plant performance achievement, (ix) return on equity, (x) economic value added, (xi) cash flow, (xii) earnings growth, (xiii) diversity, (xiv) safety, (xv) production cost, or (xvi) such other measures as may be selected by the plan administrator. Each of the performance objectives described in the preceding sentence may be stated with respect to the performance of DTE Energy, a Subsidiary or a division of DTE Energy or a Subsidiary. The performance objectives listed above are intended to qualify as "performance goals" so that grants qualify as deductible performance-based compensation for purposes of IRC Section 162(m). However, as a result of the p



36 DTE ENERGY 2018 PROXY STATEMENT

assage of the Tax Cuts Act (see discussion on page 45), the exception to 162(m) for performance-based compensation was eliminated for tax years beginning after December 31, 2017.

Amendments: The Board may amend the LTIP from time to time or terminate it at any time. However, no material amendment to the LTIP may become effective until shareholder approval is obtained. A material amendment to the LTIP is any amendment that would (a) materially increase the aggregate number of shares of common stock that may be issued or delivered under the Plan or that may be issued to a Participant; (b) permit the exercise of an option at an option price less than the Fair Market Value on the date of grant of the option or otherwise reduce the price at which an option is exercisable, either by amendment of an Agreement or substitution with a new award with a reduced price; (c) change the types of awards that may be granted under the LTIP; (d) expand the classes of persons eligible to receive awards or otherwise participate in the LTIP; or (e) require approval of the shareholders of the Company to comply with applicable law or the rules of the New York Stock Exchange.

Termination: No awards may be granted under the LTIP more than ten years after the Board's approval of the amended and restated LTIP on February 6, 2014. Awards granted before that date will remain valid in accordance with their terms.

Change in Control: In the event of a change in control, the surviving or acquiring entity may choose either to continue the LTIP and maintain all outstanding awards or to adopt a comparable equity compensation plan and grant new awards in substitution for outstanding awards under the LTIP. However, if the surviving or acquiring entity does not continue or substitute the outstanding awards, then (i) all options become fully exercisable, (ii) all stock awards become non-forfeitable and transferable, and (iii) all performance shares and performance units are earned, with the amount earned being the amount payable assuming attainment of the greater of target or actual performance levels through the date of the change in control. The accelerated exercisability, vesting or payment described in the preceding sentence may constitute a parachute payment, which may subject the affected participant to an excise tax imposed by IRC Section 4999. Consequently, the accelerated exercisability, vesting or payment is limited if, and to the extent that, the limitation will permit an affected participant to receive a greater net after-tax amount than he or she would receive absent the limitation. The limitation shall not apply to participants who are entitled to an indemnification of excise taxes by DTE Energy under change in control severance agreements or otherwise. Generally, a change in control occurs for purposes of the LTIP if DTE Energy or its assets are acquired by another company or DTE Energy merges with another company and less than 55% of the new or acquiring company’s combined voting stock is held by holders of voting stock of DTE Energy immediately prior to the transaction. Shareholder approval of a liquidation or dissolution is also considered a change in control.

THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR THE PROPOSAL TO APPROVE THE

AMENDMENT AND RESTATEMENT OF THE DTE ENERGY COMPANY LONG-TERM INCENTIVE PLAN.



	DTE ENERGY 2018 PROXY STATEMENT 37

EXECUTIVE COMPENSATION

Compensation Discussion and Analysis

Executive Summary

The Company believes in executive compensation that is competitive with our peers, has a meaningful performance component and has equity-based elements to encourage executives to maintain an appropriate ownership interest in the Company. Our performance-based compensation programs result in a majority of the compensation of our Named Executive Officers (as identified below) being linked to the achievement of a combination of short-term and long-term Company and personal goals and shareholder value creation.

The following elements comprise the total compensation awarded to our Named Executive Officers (“NEOs”):



Elements of Compensation		How this Element Serves the Company’s Objectives
Base Salary		Provides a stable, fixed source of income that reflects an executive’s job responsibilities, experience, value to the Company and demonstrated performance. We target median base salaries for our peer group, taking into account differences in company size within the peer group.
Annual Incentive Awards		Intended to compensate individuals yearly based on the achievement of specific near-term, annual goals, which are established at the beginning of each year and approved by the O&C Committee. The Board and management have identified several priority areas that management and the Board discuss regularly when reviewing Company performance. Our performance measures for annual incentive awards are the measurements that the Board uses to track progress in these key priority areas. Achievement of these performance objectives is a critical measure of the Company’s progress towards its goal of becoming the best-operated energy company in North America.
Long-term Incentive Awards		Used to align executive actions with long-term management and shareholder objectives, providing rewards consistent with the creation of shareholder value. Our plan is designed to help retain executives over time and ensure they have a strong sense of ownership in the Company.



38 DTE ENERGY 2018 PROXY STATEMENT

Pay for Performance Alignment

The Company’s compensation programs are designed to clearly align performance objectives for our named executive officers with the interests of shareholders and with management’s system of priorities. (See image of system of priorities on page 1.) Our Company’s aspiration is to be the best-operated energy company in North America and a force for growth and prosperity in the communities where we live and serve. We follow a system of priorities to achieve this objective, and our performance measures are designed to help move our Company towards achieving these priorities. The following table demonstrates how our annual and long-term performance measures map to our system of priorities.



Our System of Priorities		Related Annual or Long-Term Performance Metrics
Highly Engaged Employees		DTE Energy Employee Engagement - Gallup DTE Energy OSHA Recordable Incident Rate DTE Energy OSHA Days Away, Restricted and Transfer Rate National Safety Council Barometer Survey
Top-Decile Customer Satisfaction		Customer Satisfaction Index Customer Satisfaction Improvement Program Index MPSC Customer Complaints
Distinctive Continuous Improvement Capability		Customer Satisfaction Improvement Program Index Utility Operating Excellence Index
Strong Political & Regulatory Context		Customer Satisfaction Improvement Program Index Utility Operating Excellence Index MPSC Customer Complaints
Clear Growth & Value Creation Strategy		DTE Energy Total Shareholder Return vs Peer Group
Superior & Sustainable Financial Performance		DTE Energy Cash Flow DTE Energy Operating Earnings Per Share DTE Energy Ratio of Funds From Operations to Debt



	DTE ENERGY 2018 PROXY STATEMENT 39

What We Do and What We Don’t Do

Our compensation programs are competitive and well-governed. We adopt best practices that make sense for our company and industry and avoid pay practices that are inconsistent with our pay-for-performance structure.



What we do:		What we don’t do:
We use multiple performance measures in our short-term and long-term plans that link compensation to our corporate objectives to be the best operated energy company in North America and to maximize shareholder value		No single-trigger change-in-control payments
We make the majority of our compensation for named executive officers “at risk” to further tie compensation to performance and shareholder interests		No excessive perquisites
Our O&C Committee is comprised of all independent directors and our compensation consultant is independent		No tax gross-ups on change-in-control agreements
We adopted a clawback mechanism to allow the Company to recover incentive compensation in the event of a material financial restatement		No guaranteed bonuses
We require executives and directors to meet robust stock ownership requirements		No pledging, hedging or short sales of Company securities for officers or directors
We review and update our peer groups and benchmarking on a regular basis to make sure our compensation remains competitive and near the median of the peer group		No stock option grants since 2010
We engage with shareholders to seek input about our compensation practices and policies		No repricing of existing stock options
		No “excessive” golden parachute payments in any of our change-in-control arrangements

CEO Total Actual Compensation for 2017: Fixed vs. At-Risk

Our pay mix puts a high weight on performance-based compensation. This means that the majority of compensation is variable and will go up or down based on company performance. For 2017, 55% of our Chairman and Chief Executive Officer’s Compensation was performance-based or “at risk.”



40 DTE ENERGY 2018 PROXY STATEMENT

Overview

Your understanding of our executive compensation program is important to us. The goal of this Compensation Discussion and Analysis is to explain:


•	Our compensation philosophy and objectives for executives of the Company, including our Named Executive Officers;


•	The roles of our O&C Committee and management in the executive compensation process;


•	The key components of the executive compensation program; and


•	The decisions we make in the compensation process that align with our philosophy and objectives.

Throughout this Proxy Statement, the term “Named Executive Officers” means: (1) the Chairman of the Board and Chief Executive Officer, Gerard M. Anderson; (2) the Senior Vice President and Chief Financial Officer, Peter B. Oleksiak; (3) the Vice Chairman, Steven E. Kurmas; (4) the Vice Chairman and Chief Administrative Officer, David E. Meador; and (5) the President and Chief Operating Officer, Gerardo Norcia. In addition, the term “executive” includes the Named Executive Officers, other key employees of the Company as designated by management from time to time and Executive Officers as defined by the Exchange Act.

Philosophy and Objectives

Our executive compensation philosophy is to motivate and reward executives who achieve short-term and long-term corporate and financial objectives leading to the success of the Company. We will continue to emphasize performance-based compensation for results that are consistent with shareholder and customer interests. The main objectives underlying this philosophy are:


•	Compensation must be competitive in order to attract and retain talented executives — data from peer group companies are taken into consideration when analyzing our compensation practices and levels;


•	Compensation should have a meaningful performance component — a portion of an executive’s total compensation opportunity is linked to predefined short-term and long-term corporate and financial objectives along with an executive’s individual performance; and


•	Compensation must include equity-based elements to encourage executives to have an ownership interest in the Company.

Role of the Organization and Compensation Committee

The Board has a long-standing process for determining executive compensation that is performance-based, objective and transparent. The process is designed to serve the purpose of recruiting, retaining and motivating executives for the benefit of shareholders and customers. The Board delegates to the O&C Committee the responsibility to determine and approve the CEO’s compensation, and to approve the compensation of certain other executives. The O&C Committee makes all decisions regarding compensation for the Named Executive Officers. Although the responsibilities have been delegated, the entire Board maintains oversight and receives direct reports after each O&C Committee meeting.

The O&C Committee is composed entirely of independent directors, none of whom derives a personal benefit from the compensation decisions the O&C Committee makes. Generally, the O&C Committee is responsible for our executive compensation programs throughout the enterprise (including subsidiaries). The O&C Committee responsibilities are more fully detailed in its charter, which is available at dteenergy.com/governance. The O&C Committee continually monitors the executive compensation program and adopts changes to reflect the dynamic marketplace in which we compete for talent. To the extent necessary, the O&C Committee also works with other Board committees to review or approve reports, awards and other matters relating to compensation. For example, the Finance Committee reviews the financial components of performance measures and metrics, the Corporate Governance Committee assists in the review of this Compensation Discussion and Analysis and the Audit Committee reviews the internal controls over the data reported herein.



	DTE ENERGY 2018 PROXY STATEMENT 41

The O&C Committee uses information from several external sources to monitor and achieve an executive compensation program that supports our business goals and attracts executives whose performance will be measured against those goals. Under the Executive Performance Plan described beginning on page 45, the O&C Committee annually allocates a percentage of the overall maximum award pool established under that plan to each Applicable Officer and retains the discretion to reduce the maximum award payable to any individual Applicable Officer based on the results of the performance goals established by the O&C Committee for that officer.

Independent outside consultants and external information enable the O&C Committee to maintain impartial decision-making regarding performance and pay. The O&C Committee annually reviews each component of the Named Executive Officers’ compensation and is advised directly by the outside compensation consulting firm, discussed in further detail below, in connection with such review. Based on input from its consultant and from management and based on a review of competitive data from peer group companies (as discussed below), the O&C Committee believes that the current structure is appropriately balanced and competitive to accomplish the important tasks of recruiting, retaining and motivating talented executives in the energy industry in which we compete.

The O&C Committee also reviews and considers the results from the most recent shareholder advisory vote on executive compensation. At the 2016 and 2017 annual meetings, 96.2% and 94.7%, respectively, of voting shareholders approved the compensation of the Named Executive Officers. As part of our shareholder engagement program, we seek feedback from shareholders about our compensation practices.

Independent Review of Compensation Program

The O&C Committee directly employs an outside consulting firm, Mercer Human Resources Consulting LLC (“Mercer HR”), a subsidiary of Marsh & McClennan Companies, Inc., to advise the O&C Committee on various executive compensation matters, including current compensation trends. Mercer HR also provides objective recommendations as to the design of our executive compensation program. Mercer HR reports directly to the O&C Committee. Use of this outside consultant is an important component of the compensation setting process, as it enables the O&C Committee to make informed decisions based on market data and practices. The representative from Mercer HR, who is considered a leading professional in the compensation field, attends O&C Committee meetings, meets with Committee members in executive session, consults with the members as required and provides input with regard to the CEO’s compensation and performance.

Mercer HR has served as the O&C Committee’s outside consultant since 2002. The O&C Committee has determined Mercer HR to be an independent consultant. Mercer HR has no affiliations with any of the Named Executive Officers or members of the Board other than in its role as an outside consultant. The lead consultant and partner in charge for Mercer HR, who provides executive compensation consulting services to the O&C Committee, does not provide any other services to the Company. To help ensure that the consultant maintains the highest level of independence from the Company, all work performed by Mercer HR and its affiliates (a) which falls outside the scope of work performed for the O&C Committee on executive compensation matters, and (b) which has a total cost of $750,000 or greater, requires pre-approval by the O&C Committee based upon the recommendation of management.

In 2017, we paid Mercer HR $60,466. In addition, in 2017 the Company paid $225,000 for services unrelated to human resources consulting to affiliates of Mercer HR. In 2017, the O&C Committee followed its process to pre-approve certain work awarded to affiliates of Mercer HR.



42 DTE ENERGY 2018 PROXY STATEMENT

Management’s Role

Our management works closely with the O&C Committee in the executive compensation process. Excluding the CEO’s compensation, management’s responsibilities include:


•	Recommending performance measures and metrics that are formulated based on our corporate strategy and priorities;


•	Reporting executive performance evaluations;


•	Recommending base salary levels and other compensation, including equity awards; and


•	Recommending appointment of executives.

The CEO’s compensation is determined solely by the O&C Committee, which bases its decisions on performance and market studies along with participation and recommendations from its independent outside consultant.

Compensation and Peer Group Assessment

Each component of executive compensation (see “Key Components of Executive Compensation” below) is compared, measured and evaluated against a peer group of companies. The O&C Committee approves the peer group and periodically reviews and updates the companies included in that group.

The most recent peer group was approved by the O&C Committee in June 2015. That peer group, which is applicable for 2017, consisted of the companies listed below. Most of these companies, along with DTE Energy, participate in the same independent compensation surveys. The surveys provide data needed for accurate compensation comparisons. The peer group consists primarily of utilities (including utility holding companies), broad-based energy companies, and significant non-energy companies selected on the basis of revenues, financial strength, geographic location and availability of compensation information. The O&C Committee reviews the peer group data when making compensation decisions relating to the Named Executive Officers and the Company’s mix of compensation components.

Management also retains an external consulting firm to conduct a market study covering compensation practices for similar positions in the peer group. The most recent market study was completed in August 2017 by Aon Hewitt, whose comprehensive database included all of our desired utility/energy peer companies and also included data for most of our utility/energy-related executive positions.



Utility/Energy Companies		Non-Energy Companies
•	Ameren Corporation	•	BorgWarner, Inc.
•	American Electric Power Company, Inc.	•	Cummins Inc.
•	CenterPoint Energy, Inc.	•	Kellogg Company
•	CMS Energy Corporation	•	Masco Corporation
•	Consolidated Edison	•	Navistar International Corporation
•	Dominion Resources, Inc.	•	Owens Corning
•	Duke Energy Corporation	•	PPG Industries, Inc.
•	Edison International	•	The Sherwin-Williams Company
•	Entergy Corporation	•	Whirlpool Corporation
•	FirstEnergy Corp.
•	NiSource Inc.
•	PG&E Corporation
•	PPL Corporation
•	Public Service Enterprise Group (PSEG)
•	SCANA Corporation
•	Sempra Energy
•	Xcel Energy, Inc.



	DTE ENERGY 2018 PROXY STATEMENT 43

Key Components of Executive Compensation

The key components of the compensation program include the following:


•	Base Salary


•	Annual and Long-Term Incentives


•	Pension and Deferred Compensation


•	Post-Termination Agreements (Severance and Change-In-Control)

While the programs and pay levels reflect differences in job responsibilities, the structure of the compensation and benefits program is applied consistently to our Named Executive Officers, including the CEO. Differences in compensation between the CEO and the other Named Executive Officers are due, in part, to an analysis of peer group benchmark data, as well as differences in the responsibilities of each Named Executive Officer. We review each element of total compensation, both individually and on a combined basis, for each Named Executive Officer and make adjustments as appropriate based on these comparisons. The following is a more detailed discussion of the components of the Company’s executive compensation program:

Base Salary

The objective of base salary is to provide a stable, fixed source of income that reflects an executive’s job responsibilities, experience, value to the Company, and demonstrated performance. When setting individual base salary levels, we consider several factors, including (i) the market reference point for the executive’s position, (ii) the responsibilities of the executive’s position, (iii) the experience and performance of the executive, and (iv) retention issues. Market reference points target the median for most positions, adjusted to take into account differences in company size within the peer group. In addition, we establish midpoints for each executive group level for determining base salary for those executives whose jobs cannot be easily matched in the marketplace. These midpoints are consistent with the market reference points for other executives in the same executive group. We review these midpoints annually to ensure they are consistent with the market and make salary adjustments, when appropriate.

Annual and Long-Term Incentives

We have two primary types of incentives that reward executives for performance. The incentives are designed to tie compensation to performance and encourage executives to align their interests with those of the shareholders and customers of the Company. Our annual incentives allow us to reward executives with annual cash bonuses for performance against pre-established objectives based on work performed in the prior year. Our long-term incentives allow us to grant executives long-term equity incentives to encourage continued employment with DTE Energy, to accomplish pre-defined long-term performance objectives and to create shareholder alignment.

We believe the current mix among base salary, the annual incentives and the long-term incentives is appropriately set to provide market-competitive compensation when Company performance warrants. The mix is more heavily weighted toward incentive compensation at higher executive levels within DTE Energy. The interplay between the annual incentives and the long-term incentives provides a balance to motivate executives to achieve our business goals and objectives and to properly reward executives for the achievement of such goals and objectives.

The Board has implemented a “clawback” policy that provides that, in the event of an accounting restatement due to material noncompliance with federal securities laws and based on a determination of the O&C Committee, the Company may recover any excess performance-based compensation awarded as a result of the restatement from any of our current or former officers who received performance-based compensation (including awards under the Annual Incentive Plan, the Long-Term Incentive Plan and the Executive Performance Plan) during the three-year period preceding the date on which the Company is required to prepare an accounting restatement, in accordance with applicable law and regulations.



44 DTE ENERGY 2018 PROXY STATEMENT

Executive Performance Plan

Shareholders approved the material terms of the DTE Energy Executive Performance Plan (“Executive Performance Plan”) at the 2015 Annual Meeting. The Executive Performance Plan is the Company’s umbrella plan that was designed to enable certain payments under the Annual Incentive Plan and Long-Term Incentive Plan to satisfy the performance-based compensation exception of Internal Revenue Code Section 162(m) and to serve as the funding vehicle for all of the annual and certain long-term incentive compensation paid to the designated executive officers selected to participate in the plan. However, effective for compensation paid after 2017, the Section 162(m) exception for performance-based compensation was repealed by The Tax Cuts and Jobs Act, which was signed into law on December 22, 2017 (“Tax Cuts Act”). The Tax Cuts Act also expanded the group of employees and former employees whose compensation is subject to the deduction limitation in Section 162(m). As a result, the Company may not be entitled to take a tax deduction after 2017 for any compensation in excess of $1 million paid to any current or former Named Executive Officer. Further, the O&C Committee reserves the right to reduce compensation that was initially intended to satisfy the Section 162(m) exception if it determines that such reductions are consistent with the Company’s business needs.

The operation of the Executive Performance Plan is described below.

Performance Formula – Maximum Fund Amount. The Executive Performance Plan includes a performance formula that was approved by shareholders and will not be changed without shareholder approval. The Company’s performance for each plan year is then used to calculate the maximum potential award fund for all awards under the Executive Performance Plan. The maximum fund amount for all awards for any plan year under the Executive Performance Plan will be three percent of DTE Energy Company Adjusted Net Income for that year. “DTE Energy Adjusted Net Income” is DTE Energy Net Income adjusted to subtract Net Income for the Energy Trading reporting segment for that year. “DTE Energy Net Income” is defined as the Company’s profit as reported on the Company’s Consolidated Statements of Operations under the heading “Net Income Attributable to DTE Energy Company” in the Company’s audited financial statements as filed with the SEC in the Company’s Form 10-K for the relevant year. Net Income for the Energy Trading reporting segment is reported in the “Energy Trading” subsection of the “Management’s Discussion and Analysis of Financial Condition and Results of Operations” section as disclosed in the Company’s Form 10-K for the relevant year, based on information reported in the Company’s audited financial statements as filed with the Company’s Form 10-K.

Applicable Officers and Allocations. Not later than the ninetieth day of each calendar year, the O&C Committee will determine (a) which executive officers will participate in the Executive Performance Plan for that calendar year (the “Applicable Officers”) and (b) the individual maximum award allocated to each Applicable Officer as a percentage of the maximum award fund. Under the terms of the Executive Performance Plan, no single Applicable Officer may be allocated or receive an award of more than the lesser of (i) fifty percent of the maximum award fund or (ii) ten million dollars ($10,000,000). After the end of a calendar year, when the Company’s final Adjusted Net Income result for that year is available, the O&C Committee will determine the maximum individual award amount for each Applicable Officer based on those allocation percentages. The O&C Committee has the ability to apply negative discretion to adjust the final awards down (but never up) from that maximum individual amount based on the results of performance goals approved by the O&C Committee for that Applicable Officer.

The O&C Committee applied each Applicable Officer’s 2017 individual performance goals originally set using the Annual Incentive Plan measures, metrics, targets and procedures when determining the amount of the Applicable Officer’s 2017 award under the Executive Performance Plan. It is the intention of the O&C Committee that the total annual incentive award for each Applicable Officer paid under the Executive Performance Plan for any year will not exceed the amount that would have been awarded to the Applicable Officer for that year if the Applicable Officer’s award had been made under the Annual Incentive Plan.

Each of the Named Executive Officers was an Applicable Officer under the Executive Performance Plan for 2017. The following table sets forth each Named Executive Officer’s allocation percentage of the maximum award fund (“Maximum Award Percentage”) for 2017. The 2017 maximum individual award amount is calculated by multiplying the Maximum Award Percentage by 3 percent of DTE Energy Adjusted Net Income (“Maximum Individual Amount”). The final total 2017 executive performance plan award is the result of the O&C Committee exercising its negative discretion to reduce the Maximum Individual Amount (“Actual Award Amount”). The Actual Award Amount does not include the value of dividends paid on unvested restricted stock paid under the Executive Performance Plan.



	DTE ENERGY 2018 PROXY STATEMENT 45



Name and Title	2017 Maximum Award Percentage	2017 Maximum Individual Amount		2017 Actual Award Amount
Gerard M. Anderson	45%	$	10,000,000	$	5,128,750
Chairman and Chief Executive Officer
Peter B. Oleksiak	10%	$	3,187,827	$	1,017,625
Senior Vice President and Chief Financial Officer
Steven E. Kurmas	15%	$	4,781,741	$	820,400
Vice Chairman
David E. Meador	15%	$	4,781,741	$	1,504,725
Vice Chairman and Chief Administrative Officer
Gerardo Norcia	15%	$	4,781,741	$	1,822,550
President and Chief Operating Officer

The final awards for the 2017 year were paid to each of the Named Executive Officers in early 2018.

Annual Incentives

The objective of the annual incentives is to compensate individuals yearly based on the achievement of specific annual goals and tie compensation to near-term performance. We have two main plans for paying annual incentive awards to our executives: the DTE Energy Annual Incentive Plan (“Annual Incentive Plan”) and the Executive Performance Plan. From 2015 through 2017, the annual incentive awards for the Named Executive Officers were paid under the Executive Performance Plan. The O&C Committee sets individual performance measures, metrics and targets for the Named Executive Officers for each year using the Annual Incentive Plan measure, metrics, targets and procedures described below, and the Named Executive Officer’s performance against those measures, metrics and targets is considered when the O&C Committee determines the officer’s annual incentive award under the Executive Performance Plan for that year. For additional information regarding the Executive Performance Plan and the repeal of the Section 162(m) performance-based compensation exception, please see the discussion beginning on page 45.

Under the terms of the Annual Incentive Plan, participating executives and other select employees may receive annual cash awards based on performance compared against pre-established Company and business unit objectives. Objectives that management proposes are reviewed and approved or revised by the O&C Committee, with financial goal recommendations reviewed by the Board’s Finance Committee, no later than 90 days after the beginning of the performance period. The objectives include performance measures in several categories that are critical to our success. When setting these objectives, management and the O&C Committee determine the elements of our business that require the focused attention of the executives. The weights, which can change from year-to-year, are determined based on the Company’s key priorities and areas of focus for the upcoming year. The final awards, if any, are paid after the O&C Committee approves the final results of each objective.

The amount of an executive’s Annual Incentive Plan award is determined as follows:


•	The executive’s most recent year-end base salary is multiplied by an Annual Incentive Plan target percentage to arrive at the target award.


•	The overall performance payout percentage, which can range from 0% to 175%, is determined based on final results compared to threshold, target and maximum levels for each objective.


•	The target award is then multiplied by the performance payout percentage to arrive at the pre-adjusted calculated award.


•	The pre-adjusted calculated award is then adjusted by an individual performance modifier (assessment of an individual executive’s achievements for the year), which can range from 0% to 150%, to arrive at the final award.

Each objective has a threshold, target and maximum level. The Company or relevant business unit must attain a minimum level of achievement for an objective before any compensation is payable with respect to that objective.



46 DTE ENERGY 2018 PROXY STATEMENT

The minimum established level of each objective will result in a payout of 25% of target and the maximum established for each level (or better) will result in a payment of up to 175% of target.

The operating earnings per share and cash flow measures were chosen as indicators of the Company’s financial strength. The customer satisfaction, employee engagement and safety performance and effectiveness measures were selected to make the Company more responsive to our customers’ needs and to make the Company a safer and better place to work. The Utility Operating Excellence measures were chosen as representative of (a) electric generation and distribution reliability and (b) gas system reliability, gas system availability and the pace of gas system improvements.

For 2017, the performance objectives and the related weightings, thresholds, targets, maximums and results for calculating the Named Executive Officers’ pre-adjusted annual incentive award amounts were as follows:



Measures	Weight		Threshold			Target			Maximum			Result			Payout		Weighted Average Payout
DTE Energy Operating Earnings Per Share	25.0	%	$	5.15		$	5.30		$	5.46		$	5.59		175.0	%	43.75	%
DTE Energy Adjusted Cash Flow ($ millions)	25.0	%	$	(360	)	$	20		$	400		$	135		122.8	%	30.70	%
Customer Satisfaction Index (percentile)	8.0	%	50			60			70			82			175.0	%	14.00	%
Customer Satisfaction Improvement Program Index	6.0	%	15		%	10		%	0%			9.6		%	103.0	%	6.18	%
MPSC Customer Complaints	4.0	%	2,194			2,094			1,994			2,389			0.0%		0.0%
DTE Energy Employee Engagement– Gallup	8.0	%	4.17			4.34			4.39			4.375			152.5	%	12.20	%
Safety Performance & Effectiveness Index:
DTE Energy OSHA Recordable Incident Rate	2.67	%	0.87			0.64			0.52			0.67			90.2	%	2.41	%
DTE Energy OSHA Days Away, Restricted and Transfers Rate	2.67	%	0.44			0.39			0.18			0.37			107.1	%	2.86	%
National Safety Council Barometer Survey (percentile)	2.66	%	90			94			98			98			175.0	%	4.67	%
Utility Operating Excellence Index:
All Weather SAIDI (minutes)	2.0	%	280			265			252			1,063			0.0%		0.0%
Blue Sky CAIDI (minutes)	2.0	%	139			130			124			128			125.0	%	2.50	%
Fossil Power Plant Reliability	4.0	%	9.5		%	8.5		%	7.5		%	6.1		%	175.0	%	7.00	%
Nuclear Plant Performance	1.0	%	[see footnote for description]									Target			100.0	%	1.00	%
Refuel Outage Duration (days)	1.0	%	40			35			30			33.7			119.5	%	1.20	%
Nuclear On-Line Unit Capability Factor	1.0	%	92.0		%	94.0		%	96.0		%	96.3		%	175.0	%	1.75	%
Nuclear Power Plant Reliability Matrix	1.0	%	7			10			13			14			175.0	%	1.75	%
Gas Distribution System Improvement	1.0	%	1,784			1,284			784			845			165.9	%	1.66	%
Gas Distribution Response Time (minutes)	0.6	%	24.5			23.5			22.5			23.3			118.8	%	0.71	%
Lost and Unaccounted for Gas (Bcf)	0.8	%	4.0			3.7			3.4			4.4			0.0%		0.0%
Gas Compression Reliability	0.6	%	85.0		%	88.0		%	90.0		%	91.2		%	175.0	%	1.05	%
Gas Damage Prevention Effectiveness	0.6	%	3.9			3.7			3.5			4.8			0.0%		0.0%
Gas Transmission Reliability	0.4	%	30			37			39			39			175.0	%	0.70	%
Total	100.0	%															136.09	%

The measures in the above table are defined below:

DTE Energy Operating Earnings Per Share: DTE Energy reported earnings after operating adjustments divided by average shares outstanding. DTE Energy management believes that operating earnings provide a more meaningful representation of the company's earnings from ongoing operations and uses operating earnings as the primary performance measurement internally and externally. Operating earnings can be reconciled to our reported earnings as set forth in the following table:



	DTE ENERGY 2018 PROXY STATEMENT 47



	2017			2012
Reported Earnings per Share	$	6.32		$	3.55
PSCR disallowance	0.06
System implementation costs	0.05
Deferred tax remeasurement	(0.58		)
Impairment	0.04
Certain mark-to-market transactions	(0.30		)
Coke oven gas settlement				0.04
Chicago Fuels terminal sale				0.01
Pet coke mill impairment				0.01
Discontinued operations (unconventional gas)				0.33
Operating Earnings per Share	$	5.59		$	3.94

DTE Energy Adjusted Cash Flow: DTE Energy net cash from operating activities adjusted by utility capital expenditures, asset sale proceeds and other items approved by the O&C Committee.

Customer Satisfaction Index: Measures the satisfaction of four customer segments: (1) electric residential, (2) gas residential, (3) electric business, and (4) gas business using industry standard methodology developed by JD Power Associates (“JDPA”) to determine performance percentile relative to peers.

Customer Satisfaction Improvement Program Index: The calculation for defects per million opportunities (“DPMO”) which will include defects from DTE Cares callbacks, self-service transactions and new transactions based on the actual proportions of customer interactions measured as a change from the 2016 weighted baseline.

MPSC Customer Complaints: Number of complaints received by the Michigan Agency on Energy ("MAE")/Michigan Public Service Commission (“MPSC”) in the calendar year for all business units across DTE Energy.

DTE Energy Employee Engagement–Gallup: The average of the DTE Energy Company Gallup Grand Mean scores from two surveys during the year.

Safety Performance and Effectiveness Index: Includes three measures that are a representation of safety performance:

1. DTE Energy OSHA Recordable Incident Rate: Number of Occupational Safety and Health Administration (“OSHA”) defined recordable injuries in the calendar year per 100 employees (working an average of 2,000 hours per year, per employee) divided by the actual number of hours worked.

2. DTE Energy OSHA Days Away, Restricted and Transfers Rate: The number of OSHA defined recordable injuries that resulted in days away from work, work restrictions, and/or job duty/position transfer due to work-related injuries (DART) in the calendar year per 100 employees (working an average of 2,000 hours per year, per employee) divided by the actual number of hours worked by business unit measured.

3. National Safety Council Barometer Survey: The results of the National Safety Council ("NSC") Barometer Survey stated as a benchmark percentile as compared to the NSC database.

Utility Operating Excellence Index: Corporate index that encompasses thirteen operating excellence measures:

1. All Weather SAIDI (System Average Interruption Duration Index): For all customers served, the average minutes of interruption, regardless of weather conditions.

2. Blue Sky CAIDI (Customer Average Interruption Duration Index): The average minutes of interruption for all customers experiencing an outage for those days when there is no declared storm. A storm is declared when there are 15,000 outages in 24 hours.



48 DTE ENERGY 2018 PROXY STATEMENT

3. Fossil Power Plant Reliability: The Monroe and Belle River Random Outage Factor (ROF) which is the weighted average of the six base load coal units’ year-end ROF. A unit’s ROF is the percentage of time that a unit is not capable of reaching 100% capacity, excluding planned outages.

4. Nuclear Plant Performance: An evaluation of plant performance according to the following criteria:



Threshold	Acceptable performance and on an improving trend, with increased monitoring ended after July 2017 evaluation
Target	Strong performance, with increased monitoring ended after July 2017 evaluation
Maximum	Strong performance, with increased monitoring ended prior to July 2017 evaluation

5. Refuel Outage Duration: The time between the breaker open to the breaker closed that the plant is off-line to refuel the reactor.

6. Nuclear On-Line Unit Capability Factor: The ratio of available energy generation over a given time period to the reference energy generation over the same time period, expressed as a percentage.

7. Nuclear Power Plant Reliability Matrix: A score from 0 to 15 points measuring outcomes across 5 operational performance metrics.

8. Gas Distribution System Improvement: The number of open leaks in the system as of December 31, 2017.

9. Gas Distribution Response Time: Elapsed time in minutes from when the customer reports the condition to when the field service employee arrives at the site.

10. Lost and Unaccounted for Gas: Lost and unaccounted for gas from the source and disposition report measured in billion cubic feet (Bcf). It is a function of multiple contributors including transmission losses, theft, leaks, billing inaccuracies and metering equipment condition.

11. Gas Compression Reliability: The total number of available hours less the number of hours unavailable due to planned and unplanned shutdowns, divided by the total hours in one year.

12. Gas Damage Prevention Effectiveness: Number of third-party damages to main and service gas lines per 1,000 tickets. A ticket is defined as one staking request received from 811 (Miss Dig).

13. Gas Transmission Reliability: Installation of remote control valves (RCV) on the gas transmission system in the areas defined by regulation as High Consequence Areas (HCA). HCA is established largely by population density. The metric is measured as RCV unit installation completed, including commissioning.

The aggregate weighted payment percentage for the pre-adjusted calculated award was 136.09% for all of the Named Executive Officers.

The pre-adjusted awards are adjusted by an individual performance modifier for each of the Named Executive Officers. Individual performance criteria are set at the beginning of each calendar year for each of the Named Executive Officers. For 2017, qualitative criteria include, as applicable, leadership performance, overall operational performance, employee engagement and customer performance, diversity and inclusion, continuous operational improvements and other appropriate operating measures. The O&C Committee evaluates the individual performance of each of the Named Executive Officers and approves an adjustment to the annual award based on the individual contribution and performance. The individual performance modifier adjusts a Named Executive Officer’s annual cash bonus such that the Named Executive Officer’s actual cash bonus ranges between zero and 150% of the pre-adjusted calculated award. For 2017, the individual performance modifiers for the Named Executive Officers ranged from 105% to 130%.



	DTE ENERGY 2018 PROXY STATEMENT 49

The final awards for the 2017 year paid to each of the Named Executive Officers in early 2018 were intended to qualify for the Section 162(m) performance-based compensation exception. As a result of the passage of the Tax Cuts Act (see discussion on page 45), it is uncertain whether annual incentives paid to any current or former Named Executive Officer after 2017 will be deductible, even though the O&C Committee intended those annual incentives to qualify as performance-based compensation under Section 162(m).

Long-Term Incentives

Long-term incentives provide the O&C Committee the ability to design programs that focus on our long-term performance over a three-year period, with the objective to align executives’ interests with those of our shareholders. Our principles for ownership of stock, discussed on page 54, ensure that the executives and other employees have a vested interest in the long-term financial health, management and success of the Company.

The long-term incentives reward executives and other employees with stock-based compensation. These incentives are generally awarded under the Long-Term Incentive Plan; however, certain long-term incentives are awarded under the Executive Performance Plan, with any equity awards made under the Executive Performance Plan subject to the terms of the Long-Term Incentive Plan. As a result of the passage of the Tax Cuts Act (see discussion on page 45), it is uncertain whether long-term incentive awards paid to current or former Named Executive Officers after 2017 that the O&C Committee intended to qualify as performance-based compensation under Section 162(m) will be deductible if the Named Executive Officer’s total compensation exceeds $1 million.

Named Executive Officers are eligible to receive restricted stock, performance shares, performance units, stock options or a combination of these awards. Since the creation of the Long-Term Incentive Plan, we have granted only performance shares, time-based restricted stock and nonqualified stock options. However, the O&C Committee has not granted stock options under the Long-Term Incentive Plan since 2010. Executives receive long-term incentive grants based upon a target percentage of base salary. The targeted award levels for the Named Executive Officers for 2017 were as follows: Mr. Anderson, 460% of base salary; Mr. Oleksiak, 250% of base salary; Mr. Kurmas, 255% of base salary; Mr. Meador, 225% of base salary; and Mr. Norcia, 300% of base salary. In addition to the targeted award levels, the O&C Committee also considers previous years’ grants, career potential and retention issues in determining the final number of awards granted.

The value of each element of these long-term incentive grants for 2017 was as follows:



Performance Shares		Approximately 70%
Restricted Stock		Approximately 30%

This mix was designed to provide a balance of incentives to executives for creating long-term shareholder value through strong financial and operating performance and to align executive interests with shareholder interests.

•

Performance Shares Granted in 2017: In 2017, performance shares represented approximately 70% of the overall long-term incentive grant value. Granting of performance shares allows us to tie long-term performance objectives with creating shareholder value. Performance shares entitle the executive to receive a specified number of shares, or a cash payment equal to the fair market value of the shares, or a combination of the two, in the plan administrator’s discretion, depending on the level of achievement of performance measures. The performance measurement period for the 2017 grants is January 1, 2017 through December 31, 2019. Payments earned under the 2017 grants and the related performance measures are described in footnote 2 to the “Grants of Plan-Based Awards” table on page 58. In the event a participant retires (age 65 or age 55 or older with at least 10 years of service), dies or becomes disabled, the participant or beneficiary retains the right to a pro-rated number of the performance shares that would otherwise have been payable based upon actual results for the entire performance period. In the event employment terminates for any other reason, the participant forfeits all rights to any outstanding performance shares. In June 2009, the O&C Committee decided that, beginning with the 2010 performance share grants, dividends or dividend equivalents would not be paid on unvested or unearned performance shares. During the period beginning on the date the performance shares are awarded and ending on the certification date of the performance objectives, the number of performance shares awarded will be increased, assuming full dividend reinvestment at the fair market value on the dividend payment date. The cumulative number of performance shares will be adjusted to determine the final payment based on the performance objectives as certified by the committee.



50 DTE ENERGY 2018 PROXY STATEMENT

•

Performance Shares Paid in 2017: The performance shares granted in 2014 were paid in early 2017. The payout amounts were based upon performance measures, each of which was weighted to reflect its importance to the total calculation. The Company had to attain a minimum level for each measure before any compensation was payable with respect to that measure. The minimum established level of each measure would have resulted in a payout of 50% of target, and an established maximum (or better) for each level would have resulted in a payout of 200% of target. The payout amount was based upon the following performance measures (and related weighting):

Long-Term Incentive Plan (2017 Payout of Awards Granted in 2014)

For Messrs. Anderson, Oleksiak, Kurmas and Meador:

Measures

Weight

Threshold

Target

Maximum

Result

Payout

Weighted

Average

Payout %

Total Shareholder Return: DTE vs. Peer Group

25th percentile