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Retirement Benefits (Tables)

12 Months Ended

Dec. 31, 2021

Defined Benefit Plan Disclosure [Line Items]

Schedule Of SERP Trust Assets, ABO And Contributions

Presented in the following table are the fair values of trust assets, ABO, and contributions for CMS Energy’s and Consumers’ DB SERP:


In Millions
Years Ended December 31	2021			2020
CMS Energy, including Consumers
Trust assets		$	142		$	146
ABO		149			159
Contributions		—			8
Consumers
Trust assets		$	104		$	107
ABO		108			115
Contributions		—			5

Schedule Of Assumptions Used

Presented in the following table are the weighted-average assumptions used in CMS Energy’s and Consumers’ retirement benefit plans to determine benefit obligations and net periodic benefit cost:


December 31	2021		2020		2019
CMS Energy, including Consumers
Weighted average for benefit obligations1
Discount rate2
DB Pension Plan A	3.02	%	2.73	%	3.37	%
DB Pension Plan B	2.79		2.41		3.17
DB SERP	2.78		2.40		3.15
OPEB Plan	2.99		2.69		3.32
Rate of compensation increase
DB Pension Plan A	3.60		3.70		3.50
DB SERP	5.50		5.50		5.50
Weighted average for net periodic benefit cost1
Service cost discount rate2,3
DB Pension Plan A	2.83	%	3.44	%	4.55	%
DB SERP	2.84		3.46		4.58
OPEB Plan	3.03		3.57		4.63
Interest cost discount rate2,3
DB Pension Plan A	1.97		2.92		4.08
DB Pension Plan B	1.70		2.74		3.93
DB SERP	1.72		2.74		3.94
OPEB Plan	1.99		2.88		4.03
Expected long-term rate of return on plan assets4
DB Pension Plans	6.75		6.75		7.00
OPEB Plan	6.75		6.75		7.00
Rate of compensation increase
DB Pension Plan A	3.70		3.50		3.50
DB SERP	5.50		5.50		5.50

1The mortality assumption for benefit obligations was based on the Pri-2012 Mortality Table, with improvement scales MP-2021 for 2021, MP-2020 for 2020, and MP-2019 for 2019. The mortality assumption for net periodic benefit cost was based on the Pri-2012 Mortality Table for 2021 and 2020 and the RP-2014 Mortality Table for 2019, with improvement scales MP-2020 for 2021, MP-2019 for 2020, and MP-2018 for 2019.

2The discount rate reflects the rate at which benefits could be effectively settled and is equal to the equivalent single rate resulting from a yield-curve analysis. This analysis incorporated the projected benefit payments specific to CMS Energy’s and Consumers’ DB Pension Plans and OPEB Plan and the yields on high-quality corporate bonds rated Aa or better.

3CMS Energy and Consumers have elected to use a full-yield-curve approach in the estimation of service cost and interest cost; this approach applies individual spot rates along the yield curve to future projected benefit payments based on the time of payment.

4CMS Energy and Consumers determined the long-term rate of return using historical market returns, the present and expected future economic environment, the capital market principles of risk and return, and the

expert opinions of individuals and firms with financial market knowledge. CMS Energy and Consumers considered the asset allocation of the portfolio in forecasting the future expected total return of the portfolio. The goal was to determine a long-term rate of return that could be incorporated into the planning of future cash flow requirements in conjunction with the change in the liability. Annually, CMS Energy and Consumers review for reasonableness and appropriateness the forecasted returns for various classes of assets used to construct an expected return model. CMS Energy’s and Consumers’ expected long-term rate of return on the assets of the DB Pension Plans was 6.75 percent in 2021. The actual return on the assets of the DB Pension Plans was 12.0 percent in 2021, 13.6 percent in 2020, and 21.0 percent in 2019.

Schedule Of Net Benefit Costs

Presented in the following table are the costs (credits) and other changes in plan assets and benefit obligations incurred in CMS Energy’s and Consumers’ retirement benefit plans:


In Millions
		DB Pension Plans and DB SERP										OPEB Plan

Years Ended December 31	2021	2020			2019					2021	2020	2019
CMS Energy, including Consumers
Net periodic cost (credit)
Service cost			$	53		$	50	$	41				$	18	$	16	$	14
Interest cost			63			83		103					23		33		41
Settlement loss			1			1		—					—		—		—
Expected return on plan assets			(208)			(191)		(162)					(109)		(100)		(88)
Amortization of:
Net loss			100			95		50					8		15		26
Prior service cost (credit)			4			1		1					(53)		(56)		(62)
Settlement loss			6			2		—					—		—		—
Net periodic cost (credit)			$	19		$	41	$	33				$	(113)	$	(92)	$	(69)
Consumers
Net periodic cost (credit)
Service cost			$	51		$	49	$	40				$	17	$	15	$	13
Interest cost			59			78		97					23		31		40
Expected return on plan assets			(197)			(181)		(153)					(102)		(93)		(82)
Amortization of:
Net loss			96			90		47					8		15		26
Prior service cost (credit)			4			1		1					(51)		(54)		(61)
Settlement loss			6			2		—					—		—		—
Net periodic cost (credit)			$	19		$	39	$	32				$	(105)	$	(86)	$	(64)

Schedule Of Funded Status Of Retirement Benefit Plans

Presented in the following table are reconciliations of the funded status of CMS Energy’s and Consumers’ retirement benefit plans with their retirement benefit plans’ liabilities:


In Millions
	DB Pension Plans							DB SERP						OPEB Plan
Years Ended December 31	2021			2020				2021			2020			2021			2020
CMS Energy, including Consumers
Benefit obligation at beginning of period		$	3,266		$	2,973			$	160		$	150		$	1,205		$	1,165
Service cost		53			50				—			—			18			16
Interest cost		60			79				3			4			23			33
Plan amendments		—			24				—			—			5			—
Actuarial loss (gain)		(108)		1	355		1		(4)			16			(32)		1	39		1
Benefits paid		(201)			(215)				(10)			(10)			(53)			(48)
Benefit obligation at end of period		$	3,070		$	3,266			$	149		$	160		$	1,166		$	1,205
Plan assets at fair value at beginning of period		$	3,402		$	2,546			$	—		$	—		$	1,645		$	1,509
Actual return on plan assets		398			371				—			—			194			182
Company contribution		—			700				10			10			—			1
Actual benefits paid		(201)			(215)				(10)			(10)			(52)			(47)
Plan assets at fair value at end of period		$	3,599		$	3,402			$	—		$	—		$	1,787		$	1,645
Funded status		$	529	2	$	136	2		$	(149)		$	(160)		$	621		$	440
Consumers
Benefit obligation at beginning of period									$	117		$	109		$	1,158		$	1,120
Service cost									—			—			17			15
Interest cost									2			3			23			31
Plan amendments									—			—			5			—
Actuarial loss (gain)									(3)			12			(30)		1	37		1
Benefits paid									(7)			(7)			(51)			(45)
Benefit obligation at end of period									$	109		$	117		$	1,122		$	1,158
Plan assets at fair value at beginning of period									$	—		$	—		$	1,535		$	1,410
Actual return on plan assets									—			—			182			169
Company contribution									7			7			—			1
Actual benefits paid									(7)			(7)			(49)			(45)
Plan assets at fair value at end of period									$	—		$	—		$	1,668		$	1,535
Funded status									$	(109)		$	(117)		$	546		$	377

1The actuarial gains for 2021 for the DB Pension Plans and OPEB Plan were primarily the result of higher discount rates. The actuarial loss for 2020 for the DB Pension Plans was primarily the result of lower discount rates and lower interest rates used to calculate the value of lump-sum payments. The actuarial loss for 2020 for the OPEB Plan was primarily the result of lower discount rates.

2The total funded status of the DB Pension Plans attributable to Consumers, based on an allocation of expenses, was $510 million at December 31, 2021 and $138 million at December 31, 2020.

Schedule Of Retirement Benefit Plan Assets (Liabilities)

Presented in the following table is the classification of CMS Energy’s and Consumers’ retirement benefit plans’ assets and liabilities:


In Millions
December 31	2021			2020
CMS Energy, including Consumers
Non-current assets
DB Pension Plans		$	529		$	136
OPEB Plan		621			440
Current liabilities
DB SERP		10			10
Non-current liabilities

DB SERP		139			150

Consumers
Non-current assets
DB Pension Plans		$	510		$	138
OPEB Plan		546			377
Current liabilities
DB SERP		7			7
Non-current liabilities

DB SERP		102			110

Schedule Of Net Periodic Benefit Cost Not Yet Recognized

Presented in the following table are the amounts recognized in regulatory assets, regulatory liabilities, and AOCI that have not been recognized as components of net periodic benefit cost. For additional details on regulatory assets and regulatory liabilities, see Note 2, Regulatory Matters.


In Millions
	DB Pension Plans and DB SERP						OPEB Plan
December 31	2021			2020			2021			2020
CMS Energy, including Consumers
Regulatory assets (liabilities)
Net loss		$	812		$	1,194		$	136		$	254
Prior service cost (credit)		25			29			(190)			(246)
Regulatory assets (liabilities)		$	837		$	1,223		$	(54)		$	8
AOCI
Net loss (gain)		94			120			(17)			(10)
Prior service cost (credit)		—			1			(5)			(6)
Total amounts recognized in regulatory assets (liabilities) and AOCI		$	931		$	1,344		$	(76)		$	(8)
Consumers
Regulatory assets (liabilities)
Net loss		$	812		$	1,194		$	136		$	254
Prior service cost (credit)		25			29			(190)			(246)
Regulatory assets (liabilities)		$	837		$	1,223		$	(54)		$	8
AOCI
Net loss		41			47			—			—
Total amounts recognized in regulatory assets (liabilities) and AOCI		$	878		$	1,270		$	(54)		$	8

Schedule Of Allocation Of Plan Assets

Presented in the following tables are the fair values of the assets of CMS Energy’s DB Pension Plans and OPEB Plan, by asset category and by level within the fair value hierarchy. For additional details regarding the fair value hierarchy, see Note 5, Fair Value Measurements.


In Millions
	DB Pension Plans
	December 31, 2021									December 31, 2020
	Total			Level 1			Level 2			Total			Level 1			Level 2
CMS Energy, including Consumers
Cash and short-term investments		$	30		$	30		$	—		$	115		$	115		$	—
U.S. government and agencies securities		209			—			209			150			—			150
Corporate debt		595			—			595			540			—			540
State and municipal bonds		13			—			13			11			—			11
Foreign corporate bonds		66			—			66			41			—			41
Mutual funds		785			785			—			971			971			—
		$	1,698		$	815		$	883		$	1,828		$	1,086		$	742
Pooled funds		1,901									1,574
Total		$	3,599								$	3,402


In Millions
	OPEB Plan
	December 31, 2021									December 31, 2020
	Total			Level 1			Level 2			Total			Level 1			Level 2
CMS Energy, including Consumers
Cash and short-term investments		$	21		$	21		$	—		$	33		$	33		$	—
U.S. government and agencies securities		25			—			25			18			—			18
Corporate debt		73			—			73			64			—			64
State and municipal bonds		2			—			2			2			—			2
Foreign corporate bonds		8			—			8			5			—			5
Common stocks		85			85			—			66			66			—
Mutual funds		941			941			—			807			807			—
		$	1,155		$	1,047		$	108		$	995		$	906		$	89
Pooled funds		632									650
Total		$	1,787								$	1,645

Schedule Of Asset Allocation

Presented in the following table are the investment components of the assets of CMS Energy’s DB Pension Plans and OPEB Plan as of December 31, 2021:


	DB Pension Plans			OPEB Plan
Equity securities		54.0	%		55.0	%
Fixed-income securities		28.0			28.0
Real asset investments		12.0			12.0
Multi-asset investments		5.0			4.0
Cash and Cash Equivalents		1.0			1.0
		100.0	%		100.0	%

Schedule Of Plan Contributions

Presented in the following table are the contributions to CMS Energy’s and Consumers’ DB Pension Plans and OPEB Plan:


In Millions
Years Ended December 31	2021			2020
CMS Energy, including Consumers
DB Pension Plans		$	—		$	700
OPEB Plan		—			1
Consumers
DB Pension Plans		$	—		$	682
OPEB Plan		—			1

Schedule Of Expected Benefit Payments

Presented in the following table are the expected benefit payments for each of the next five years and the five-year period thereafter:


In Millions
	DB Pension Plans			DB SERP			OPEB Plan
CMS Energy, including Consumers
2022		$	185		$	10		$	52
2023		181			10			54
2024		178			10			56
2025		180			10			58
2026		178			9			59
2027-2031		876			45			308
Consumers
2022		$	175		$	7		$	49
2023		171			7			52
2024		169			7			54
2025		170			7			55
2026		169			6			56
2027-2031		830			31			294

Consumers Energy Company