Reportable Segments

12 Months Ended

Dec. 31, 2012

Reportable Segments

17:REPORTABLE SEGMENTS

Reportable segments consist of business units defined by the products and services they offer.  CMS Energy and Consumers evaluate the performance of each segment based on its contribution to net income available to CMS Energy’s common stockholders.  The reportable segments for CMS Energy and Consumers are:

CMS Energy:

· electric utility, consisting of regulated activities associated with the generation and distribution of electricity in Michigan;

· gas utility, consisting of regulated activities associated with the transportation, storage, and distribution of natural gas in Michigan;

· enterprises, consisting of various subsidiaries engaging primarily in domestic independent power production; and

· other, including EnerBank, corporate interest and other expenses, and discontinued operations.

Consumers:

· electric utility, consisting of regulated activities associated with the generation and distribution of electricity in Michigan;

· gas utility, consisting of regulated activities associated with the transportation, storage, and distribution of natural gas in Michigan; and

· other, including a consolidated special-purpose entity for the sale of accounts receivable.

Accounting policies for CMS Energy’s and Consumers’ segments are as described in Note 1, Significant Accounting Policies.  The consolidated financial statements reflect the assets, liabilities, revenues, and expenses of the individual segments when appropriate.  Accounts are allocated among the segments when common accounts are attributable to more than one segment.  The allocations are based on certain measures of business activities, such as revenue, labor dollars, customers, other operation and maintenance expense, construction expense, leased property, taxes, or functional surveys.  For example, customer receivables are allocated based on revenue, and pension provisions are allocated based on labor dollars.

Inter-segment sales and transfers are accounted for at current market prices and are eliminated in consolidated net income available to common stockholders by segment.

Presented in the following tables is financial information by reportable segment:

In Millions
Years Ended December 31	2012			2011			2010
CMS Energy, including Consumers
Operating revenue
Electric utility		$	4,031		$	3,913		$	3,802
Gas utility			1,982			2,340			2,354
Enterprises			183			204			238
Other			57			46			38
Total operating revenue – CMS Energy		$	6,253		$	6,503		$	6,432
Consumers
Operating revenue
Electric utility		$	4,031		$	3,913		$	3,802
Gas utility			1,982			2,340			2,354
Total operating revenue – Consumers		$	6,013		$	6,253		$	6,156
CMS Energy, including Consumers
Depreciation and amortization
Electric utility		$	459		$	412		$	450
Gas utility			133			130			122
Enterprises			4			3			3
Other			2			1			1
Total depreciation and amortization – CMS Energy		$	598		$	546		$	576
Consumers
Depreciation and amortization
Electric utility		$	459		$	412		$	450
Gas utility			133			130			122
Total depreciation and amortization – Consumers		$	592		$	542		$	572
CMS Energy, including Consumers
Income from equity method investees1
Enterprises		$	17		$	9		$	11
Total income from equity method investees –  CMS Energy		$	17		$	9		$	11
CMS Energy, including Consumers
Interest charges
Electric utility		$	179		$	192		$	202
Gas utility			63			71			73
Other			147			152			156
Total interest charges – CMS Energy		$	389		$	415		$	431
Consumers
Interest charges
Electric utility		$	179		$	192		$	202
Gas utility			63			71			73
Other			2			2			2
Total interest charges – Consumers		$	244		$	265		$	277

In Millions
Years Ended December 31	2012			2011			2010
CMS Energy, including Consumers
Income tax expense (benefit)
Electric utility		$	227		$	190		$	187
Gas utility			70			77			67
Enterprises			(1)			(24)			14
Other			(51)			(52)			(44)
Total income tax expense – CMS Energy		$	245		$	191		$	224
Consumers
Income tax expense
Electric utility		$	227		$	190		$	187
Gas utility			70			77			67
Total income tax expense – Consumers		$	297		$	267		$	254
CMS Energy, including Consumers
Net income (loss) available to common stockholders
Electric utility		$	325		$	333		$	303
Gas utility			110			130			127
Enterprises			16			32			36
Other			(69)			(80)			(142)
Total net income available to common stockholders –    CMS Energy		$	382		$	415		$	324
Consumers
Net income available to common stockholder
Electric utility		$	325		$	333		$	303
Gas utility			110			130			127
Other			2			2			2
Total net income available to common stockholder –    Consumers		$	437		$	465		$	432
CMS Energy, including Consumers
Plant, property, and equipment, gross
Electric utility		$	11,041		$	10,400		$	9,944
Gas utility			4,400			4,206			4,063
Enterprises			113			109			102
Other			38			36			36
Total plant, property, and equipment – CMS Energy		$	15,592		$	14,751		$	14,145
Consumers
Plant, property, and equipment, gross
Electric utility		$	11,041		$	10,400		$	9,944
Gas utility			4,400			4,206			4,063
Other			15			15			15
Total plant, property, and equipment – Consumers		$	15,456		$	14,621		$	14,022
CMS Energy, including Consumers
Investments in equity method investees1
Enterprises		$	55		$	49		$	48
Other			2			1			1
Total investments in equity method investees – CMS Energy		$	57		$	50		$	49

In Millions
Years Ended December 31	2012			2011			2010
CMS Energy, including Consumers
Total assets
Electric utility2		$	10,423		$	9,938		$	9,321
Gas utility2			5,016			4,956			4,614
Enterprises			181			242			191
Other			1,511			1,316			1,490
Total assets – CMS Energy		$	17,131		$	16,452		$	15,616
Consumers
Total assets
Electric utility2		$	10,423		$	9,938		$	9,321
Gas utility2			5,016			4,956			4,614
Other			836			768			904
Total assets – Consumers		$	16,275		$	15,662		$	14,839
CMS Energy, including Consumers
Capital expenditures3
Electric utility		$	921		$	661		$	642
Gas utility			340			261			235
Enterprises			1			5			4
Other			4			1			2
Total capital expenditures – CMS Energy		$	1,266		$	928		$	883
Consumers
Capital expenditures3
Electric utility		$	921		$	661		$	642
Gas utility			340			261			235
Total capital expenditures – Consumers		$	1,261		$	922		$	877

¹ Consumers had no significant equity method investments.

² Amounts include a portion of Consumers’ other common assets attributable to both the electric and gas utility businesses.

³ Amounts include purchase of capital lease additions.  Amounts also include a portion of Consumers’ capital expenditures for plant and equipment attributable to both the electric and gas utility businesses.

CMS Energy and Consumers had no international operating revenues or operating income for each of the years ended December 31, 2012, 2011, and 2010.  CMS Energy had international assets of less than $1 million at December 31, 2012, $1 million at December 31, 2011, and $3 million at December 31, 2010.  Consumers had no international assets for any of the years presented.

Consumers Energy Company [Member]

Reportable Segments

17:REPORTABLE SEGMENTS

Reportable segments consist of business units defined by the products and services they offer.  CMS Energy and Consumers evaluate the performance of each segment based on its contribution to net income available to CMS Energy’s common stockholders.  The reportable segments for CMS Energy and Consumers are:

CMS Energy:

· electric utility, consisting of regulated activities associated with the generation and distribution of electricity in Michigan;

· gas utility, consisting of regulated activities associated with the transportation, storage, and distribution of natural gas in Michigan;

· enterprises, consisting of various subsidiaries engaging primarily in domestic independent power production; and

· other, including EnerBank, corporate interest and other expenses, and discontinued operations.

Consumers:

· electric utility, consisting of regulated activities associated with the generation and distribution of electricity in Michigan;

· gas utility, consisting of regulated activities associated with the transportation, storage, and distribution of natural gas in Michigan; and

· other, including a consolidated special-purpose entity for the sale of accounts receivable.

Accounting policies for CMS Energy’s and Consumers’ segments are as described in Note 1, Significant Accounting Policies.  The consolidated financial statements reflect the assets, liabilities, revenues, and expenses of the individual segments when appropriate.  Accounts are allocated among the segments when common accounts are attributable to more than one segment.  The allocations are based on certain measures of business activities, such as revenue, labor dollars, customers, other operation and maintenance expense, construction expense, leased property, taxes, or functional surveys.  For example, customer receivables are allocated based on revenue, and pension provisions are allocated based on labor dollars.

Inter-segment sales and transfers are accounted for at current market prices and are eliminated in consolidated net income available to common stockholders by segment.

Presented in the following tables is financial information by reportable segment:

In Millions
Years Ended December 31	2012			2011			2010
CMS Energy, including Consumers
Operating revenue
Electric utility		$	4,031		$	3,913		$	3,802
Gas utility			1,982			2,340			2,354
Enterprises			183			204			238
Other			57			46			38
Total operating revenue – CMS Energy		$	6,253		$	6,503		$	6,432
Consumers
Operating revenue
Electric utility		$	4,031		$	3,913		$	3,802
Gas utility			1,982			2,340			2,354
Total operating revenue – Consumers		$	6,013		$	6,253		$	6,156
CMS Energy, including Consumers
Depreciation and amortization
Electric utility		$	459		$	412		$	450
Gas utility			133			130			122
Enterprises			4			3			3
Other			2			1			1
Total depreciation and amortization – CMS Energy		$	598		$	546		$	576
Consumers
Depreciation and amortization
Electric utility		$	459		$	412		$	450
Gas utility			133			130			122
Total depreciation and amortization – Consumers		$	592		$	542		$	572
CMS Energy, including Consumers
Income from equity method investees1
Enterprises		$	17		$	9		$	11
Total income from equity method investees –  CMS Energy		$	17		$	9		$	11
CMS Energy, including Consumers
Interest charges
Electric utility		$	179		$	192		$	202
Gas utility			63			71			73
Other			147			152			156
Total interest charges – CMS Energy		$	389		$	415		$	431
Consumers
Interest charges
Electric utility		$	179		$	192		$	202
Gas utility			63			71			73
Other			2			2			2
Total interest charges – Consumers		$	244		$	265		$	277

In Millions
Years Ended December 31	2012			2011			2010
CMS Energy, including Consumers
Income tax expense (benefit)
Electric utility		$	227		$	190		$	187
Gas utility			70			77			67
Enterprises			(1)			(24)			14
Other			(51)			(52)			(44)
Total income tax expense – CMS Energy		$	245		$	191		$	224
Consumers
Income tax expense
Electric utility		$	227		$	190		$	187
Gas utility			70			77			67
Total income tax expense – Consumers		$	297		$	267		$	254
CMS Energy, including Consumers
Net income (loss) available to common stockholders
Electric utility		$	325		$	333		$	303
Gas utility			110			130			127
Enterprises			16			32			36
Other			(69)			(80)			(142)
Total net income available to common stockholders –    CMS Energy		$	382		$	415		$	324
Consumers
Net income available to common stockholder
Electric utility		$	325		$	333		$	303
Gas utility			110			130			127
Other			2			2			2
Total net income available to common stockholder –    Consumers		$	437		$	465		$	432
CMS Energy, including Consumers
Plant, property, and equipment, gross
Electric utility		$	11,041		$	10,400		$	9,944
Gas utility			4,400			4,206			4,063
Enterprises			113			109			102
Other			38			36			36
Total plant, property, and equipment – CMS Energy		$	15,592		$	14,751		$	14,145
Consumers
Plant, property, and equipment, gross
Electric utility		$	11,041		$	10,400		$	9,944
Gas utility			4,400			4,206			4,063
Other			15			15			15
Total plant, property, and equipment – Consumers		$	15,456		$	14,621		$	14,022
CMS Energy, including Consumers
Investments in equity method investees1
Enterprises		$	55		$	49		$	48
Other			2			1			1
Total investments in equity method investees – CMS Energy		$	57		$	50		$	49

In Millions
Years Ended December 31	2012			2011			2010
CMS Energy, including Consumers
Total assets
Electric utility2		$	10,423		$	9,938		$	9,321
Gas utility2			5,016			4,956			4,614
Enterprises			181			242			191
Other			1,511			1,316			1,490
Total assets – CMS Energy		$	17,131		$	16,452		$	15,616
Consumers
Total assets
Electric utility2		$	10,423		$	9,938		$	9,321
Gas utility2			5,016			4,956			4,614
Other			836			768			904
Total assets – Consumers		$	16,275		$	15,662		$	14,839
CMS Energy, including Consumers
Capital expenditures3
Electric utility		$	921		$	661		$	642
Gas utility			340			261			235
Enterprises			1			5			4
Other			4			1			2
Total capital expenditures – CMS Energy		$	1,266		$	928		$	883
Consumers
Capital expenditures3
Electric utility		$	921		$	661		$	642
Gas utility			340			261			235
Total capital expenditures – Consumers		$	1,261		$	922		$	877

¹ Consumers had no significant equity method investments.

² Amounts include a portion of Consumers’ other common assets attributable to both the electric and gas utility businesses.

³ Amounts include purchase of capital lease additions.  Amounts also include a portion of Consumers’ capital expenditures for plant and equipment attributable to both the electric and gas utility businesses.

CMS Energy and Consumers had no international operating revenues or operating income for each of the years ended December 31, 2012, 2011, and 2010.  CMS Energy had international assets of less than $1 million at December 31, 2012, $1 million at December 31, 2011, and $3 million at December 31, 2010.  Consumers had no international assets for any of the years presented.