European Investor Update

June/July 2004

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Safe Harbor Statement

DTE Energy expressly disclaims any current intention to update any forward-looking statements contained in this document as a result of new information or future events or developments. Words such as “anticipate,” “believe,” “expect,” “projected” and “goals” signify forward-looking statements. Forward-looking statements are not guarantees of future results and conditions but rather are subject to various assumptions, risks and uncertainties. This press release contains forward-looking statements about DTE Energy’s financial results and estimates of future prospects, and actual results may differ materially. Factors that may impact forward-looking statements include, but are not limited to, timing and extent of changes in interest rates; access to the capital markets and capital market conditions and other financing efforts which can be affected by credit agency ratings requirements; ability to utilize Section 29 tax credits or sell interest in facilities producing such credits; the level of borrowings; the effects of weather and other natural phenomena on operations and actual sales; economic climate and growth in the geographic areas in which DTE Energy does business; unplanned outages; the cost of protecting assets against or damage due to terrorism; nuclear regulations and risks associated with nuclear operations; the grant of rate relief by the MPSC for the utilities; changes in the cost of fuel, purchased power and natural gas; the effects of competition; the implementation of electric and gas customer choice programs; the implementation of electric and gas utility restructuring in Michigan; environmental issues, including changes in the climate, and regulations, and the contributions to earnings by non-regulated businesses. This press release should also be read in conjunction with the forward-looking statements in DTE Energy’s, MichCon’s and Detroit Edison’s 2003 Form 10-K Item 1, and in conjunction with other SEC reports filed by DTE Energy, MichCon and Detroit Edison.

3

Participants

• Anthony F. Earley, Jr.– Chairman and Chief Executive Officer

• David E. Meador– Senior Vice President and Chief Financial Officer

• Peter J. Pintar– Director of Investor Relations and Technology Investments

4

Outline

• DTE Energy is a solid company with a consistent long-term strategy

• DTE Energy is addressing its current challenges

• DTE Energy represents an attractive investment opportunity

5

DTE Energy Overview

Utility Platform Non-Regulated Platform

• On-site Energy Projects• Steel-Related Projects• Power Generation with Services• Waste Coal Recovery

• Michigan Gas Production• Shale and Coalbed Methane• Landfill Gas

• Coal Transportation and Marketing

• Gas Pipelines and Storage• Energy Trading and Marketing

Power and Industrial Projects

Non-conventional Gas Production

Fuel Transportation and Marketing

Generates and distributes electricity throughout Southeastern Michigan

Produces, gathers, transmits, stores and distributes natural gas throughout Michigan

6

DTE Energy Geography

On-Site Energy Projects

Coke Batteries

Synfuels

Biomass

Regional Area of Focus

7

Consistent Business Strategy

• Since 1997, DTE Energy has had a consistent business strategy – a strong regulated utility base coupled with consistent growth in our non-regulated portfolio

• The regulated utility base is formed by two companies:– Detroit Edison, an integrated electric utility– MichCon, a natural gas distribution company

• The non-regulated portfolio is a group of inter-related businesses that leverage the knowledge and expertise originally developed in the regulated businesses

• Anchoring this strategy is a commitment to balance sheet strength

• On a long-term basis, this model has provided consistent shareholder value

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DTE Energy’s Solid Asset Portfolio – Detroit Edison

• Detroit Edison is an integrated electric utility primarily serving the metropolitan Detroit area

• Ninth largest U.S. electric utility

• Although the region has a strong industrial concentration, the company’s revenue base is diverse, with no single customer comprising more than 5% of revenues

• Both Detroit Edison’s generating and distribution assets are fully regulated

• Currently ~60% of customers are subject to rate caps which fully expire on 1/1/2006

• As the rate caps expire, all customers will be effectively transitioned to the Power Supply Recovery Clause (PSCR), a mechanism that passes fuel and purchased power costs through to customers

• Detroit Edison has a history of reasonable returns and is currently undergoing its first rate case in 10 years

1998 1999 2000 2001 2002 2003

Detroit Edison Historical ROE

11.8% 11.8% 11.1% 11.7%13.6%

9.7%

Revenues (2003) $3,695M

Residential 40%Commercial 38%Industrial 18%Other 4%

Requested ROE 11.5%

Requested Equity Level $3.2B

Requested Debt/Equity 50/50

1-2%Expected Service Territory Load Growth

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DTE Energy’s Solid Asset Portfolio – Detroit Edison Generation Assets

• Low cost western coal is the dominant fuel source of Detroit Edison’s efficient generating fleet

• The company’s expertise in coal sourcing and transportation enhances the fleet’s cost profile

• Our single nuclear unit, Fermi 2, is well regarded in the industry

• In 2001, the company securitized the Fermi 2 nuclear plant which essentially removed $1.8 billion in risk from the balance sheet

• Detroit Edison’s generation fleet compares favorably versus others in the region

Generation Fuel Mix (2003)~46,000 GWh

$20

$40

$60

$80

0 25,000 50,000 75,000 100,000Cumulative MW

$/M

Wh

Min Annual DemandAvg. Annual Demand

SummerPeakDemand

ECAR* Dispatch CurveSummer 2005

Represents ~67% of total generating capacity

* East Central Area Reliability Region comprised primarily of Michigan, Indiana, Ohio and western Pennsylvania

Detroit Edison power plants

Nuclear 18%

Gas/Oil 1%

Coal 81%

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DTE Energy’s Solid Asset Portfolio – MichCon

• MichCon is a natural gas local distribution company serving the metropolitan Detroit area and western Michigan

• Fifth largest U.S. natural gas LDC• Has a large residential customer base, that

produces a stable revenue stream• 124 bcf of gas storage assets, in addition,

DTE Energy owns 51 bcf of non-regulated storage

• MichCon’s profit margins derive from the physical distribution of natural gas, not from the commodity itself. The commodity price impacts are passed through to customers

• The primary economic driver of MichCon is weather. Given the large residential base, general economic conditions have a much smaller impact

• MichCon has a history of reasonable returns, but is currently undergoing its first rate case in 10 years

1998 1999 2000 2001 2002 2003

MichCon Historical ROE

12.2%15.3% 14.9%

6.6%8.9%

5.3%

Assets (2003) $2.98B

Revenues (2003) $1,492M

Residential 73%Commercial 23%Industrial & Other 4%

Requested ROE 11.5%

Requested Equity Level $875M

Requested Debt/Equity 50/50

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Overview of DTE Energy’s Non-Regulated Businesses

Power and Industrial Projects DescriptionOn-site Energy Projects • Investments in energy production facilities on the sites of

large energy users

Steel-Related Projects • Three coke batteries and two pulverized coal injection projects

Power Generation with Services • Asset management services for power projects

Waste Coal Recovery • Own proprietary technology that reclaims waste coal

Non-conventional Gas Production

Michigan Gas Production •Northern Michigan Antrim Shale gas production

Shale and Coal-bed Methane •Development and production of sites

Landfill Gas (Biomass) •Own and operate landfill gas recovery facilities

Fuel Transportation and Marketing

Coal Transportation and Marketing • Largest transporter of coal to third party customers in North America

Gas Pipelines and Storage •Vector pipeline, 51 bcf of storage

Energy Trading and Marketing •Physical power marketing and structured transactions

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DTE Energy’s Approach to Building Non-Regulated Businesses

Core Skills

On-Site Energy Projects

Waste Coal

Recovery

Synthetic Fuels

Business

Coke Battery

Business

• DTE Energy’s non-regulated businesses leverage our core skills

• Investments are generally made in incremental steps in order to better understand the business before making more substantial investments

• As these businesses mature, they serve as the platform to develop future businesses

• This approach has helped DTE Energy avoid the recent industry pitfalls

Coal Services/ Transport.

Coal handling expertise at

Detroit Edison

Detroit Edison’s knowledge of

industrial sector

Experience with tax-advantaged businesses at DTE Biomass

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DTE Energy’s Approach to Non-Regulated Businesses has Produced Solid Growth and Returns

1999 2000 2001 2002 2003 2004E

$68 $84

$162

$207$228

$194-$249

Non-Regulated Net Income($ millions)

Invested Capital

Return on Capital

After-Tax ROE

Energy Services

$810 21% 28%

Coal Services $60 23% >30%

Biomass Energy

$40 14% 16%

Gas Production & Midstream

$440 7% 7%

Average 2001-2003

Non-Regulated Returns

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DTE Energy’s Business Strategy is Anchored by a Strong Balance Sheet

DTE Energy Leverage*

40%

45%

50%

55%

60%

1999 2000 2001 2002 2003

20%

30%

40%

50%

60%

70%

DTE Ene

rgy*

Exelon

Alliant

Ene

rgy

Progr

ess E

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Cinerg

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TXU

Wisc

onsin

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AEP

Leverage of Industry Peers

• Despite the problems that have plagued the industry, DTE Energy has been able to maintain a strong balance sheet

• This was achieved without having to resort to a ‘back-to-basics’ strategy

• Despite the current challenges, DTE Energy’s leverage has not been negatively impacted

• Compared to industry peers with similar credit profiles, DTE Energy’s leverage compares favorably

* Excludes securitization debt, MichCon short-term debt and quasi-equity instruments

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Outline

• DTE Energy is a solid company with a consistent long-term strategy

• DTE Energy is addressing its current challenges

• DTE Energy represents an attractive investment opportunity

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Current Challenges

• Currently, DTE Energy is working through a number of regulatory issues– Pending rate cases at both Detroit Edison and

MichCon– Repairing Michigan’s Electric Choice program

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Current Challenges -Utility Rate Cases

• Currently there are rate cases pending at Detroit Edison and MichCon

• Neither utility has had a rate case in over 10 years

• Underlying both of these rate cases are standard cost-of-service issues driven by general inflationary pressures and rising health care and pension costs

• Both rate requests are reasonable. Relative to inflation, rates at both Detroit Edison and MichCon have declined substantially

Detroit Edison Residential Rates versus InflationRates

¢/KWh

1.75

2.00

2.25

2.50

2.75

1994 1996 1998 2000 2002

MichCon Residential Rates versus Inflation

Rates$/Mcf

8

9

10

11

12

1994 1996 1998 2000 2002

Consumer Price Index

(CPI)

Rates

Rates

Consumer Price Index

(CPI)

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Current Challenges -Status of Rate Requests

Detroit Edison MichCon

Interim Rate Request $504 million $154 million

Base Rate Request $553 million $194 million

Status of Interim Request

• Granted $278 million –Increases 2004 net

revenues by $51 million –$248 million base rate

increase• Restart of the fuel clause

pass-through

Order expected late July/early August

MPSC Staff Recommendation on Final Rates

• Recommended $378 million base rate increase

• Choice transition charges• Mitigation sales margins to

offset Choice loss

Recommendation expected late July 2004

Administrative Law Judge Recommendation

Recommendation expected late June/early July 2004

Recommendation expected October 2004

Final OrderOrder expected

September 2004

Order expected

December 2004

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Current Challenges -Development of the Electric Choice Program

• In June 2000, Michigan passed Public Act 141 (PA 141) which was intended to be an initial step toward full deregulation

• PA 141 authorized the electric choice program, which allowed all customers to select their generation supplier as of January 1, 2002

• In addition, all customer rates were frozen through 2003, with caps in place for small commercial and industrial customers through 2004 and residential customers through 2005

• PA 141 also authorized the securitization of the Fermi 2 nuclear power plant. The proceeds of $1.8 billion were used to repay debt and repurchase stock

• Although the law was a well-intended economic development tool for Michigan, it produced a set of unintended consequences

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Current Challenges -Development of the Electric Choice Program (cont.)

• The Michigan Public Service Commission (MPSC) undertook a series of actions to promote a robust choice program:– No return to service provisions were authorized, customers

essentially had a free option to switch between Detroit Edison and alternative suppliers

– No transition surcharges were authorized for customers opting for alternative suppliers

– Some customers received transition credits when opting for alternative suppliers

• Historically in Michigan, commercial rates are skewed higher, resulting in a customer group that was very vulnerable to alternative suppliers

• These factors produced an artificial Electric Choice market that is not sustainable on a long-term basis

• This artificial market creates a substantial negative financial impact for Detroit Edison. It is estimated that the net lost margin for 2004 will be $200-220 million

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Current Challenges -Recent Activity Regarding Choice

• Through the rate case and legislative efforts, Detroit Edison has been actively working to resolve this issue

• Recent regulatory activity has produced some positive developments

– The interim rate order eliminated the transition credits and imposed a small transition charge

– The MPSC staff recommended a series of return to service rules

– The Michigan Senate Energy & Technology Committee held extensive hearings regarding the implementation of PA 141 and the Electric Choice program

• These steps have resulted in the leveling off of Electric Choice levels

• Despite these developments, the issue is not fully resolved. Detroit Edison will continue to work on the regulatory and legislative fronts to ensure a level playing field for a competitive Electric Choice program

0

2,000

4,000

6,000

8,000

10,000

Detroit Edison Electric Choice Program

(Gwh)

May

200

3A

ug 2

003

Nov

200

3D

ec 2

003

Jan

2004

Feb

2004

Mar

200

4A

pr 2

004

May

200

4

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Outline

• DTE Energy is a solid company with a consistent long-term strategy

• DTE Energy is addressing its current challenges

• DTE Energy represents an attractive investment opportunity

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DTE Energy Represents an Attractive Investment Opportunity

• DTE Energy is currently undervalued versus its peers• The stock has a strong dividend yield of 5.2%• Utility returns are expected to improve upon

resolution of the rate cases• Non-regulated businesses will generate significant

cash flows• Non-regulated businesses will continue their growth• The balance sheet will remain strong

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0

2

4

6

8

10

12

14

16

18

Allegh

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Cente

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Amer

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South

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ConEd

Edison

Inte

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CINer

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FirstE

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Xcel E

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Pinnac

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PG&EFPL

Teco

Domini

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Progr

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Enter

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Exelon PPL

CMS

TXU

DTE Energy is Currently Trading at a Significant Discount to its Peers

S&P Electrics’ P/E MultiplesBased on 2005 First Call Estimates

Median 12.7

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DTE is Currently Providing a Strong Dividend Yield Versus Other U.S. Utilities

0%

1%

2%

3%

4%

5%

6%

Amer

enTec

o

Con E

dDTE

Progr

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CINer

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South

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Pinnac

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Domini

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up

PP&L

Edison

Int.

Exelon

Enter

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Allegh

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CMS

PG&E

S&P Electrics’ Dividend YieldJune 2004

Median: 4.2%

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Utility Returns are Expected to Improve

• With the expected resolution of the rate cases and Electric Choice, utility returns are expected to improve

• Detroit Edison’s improvement will be staggered as rate caps role off

• Ultimately the utilities will be allowed to earn reasonable returns

Detroit Edison

Equity Ratio 50% 50% 55%

Equity Level (Billion) $3.0 $3.0 $3.3

Earned ROE 11.0% 11.5% 11.0%

Net Income (Million) $330 $345 $363

MichCon

Equity Ratio

Equity Level (Billion)

Earned ROE

Net Income (Million)

50% 50% 52%

$0.82 $0.82 $0.85

11.5% 12.0% 12.0%

$94 $98 $102

Illustrative Range of Outcomes(assuming a full year of increased rates)

NOTE: This should not be construed as earnings guidance

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The Sale of our Synthetic Fuel Facilities Will Provide Significant Cash Flows

• Through 2008 our synfuel business is expected to generate $1.8 billion in net cash flow

• The synthetic fuel facilities transform marginal coal into high quality coal. The favorable economics of this business are driven by tax credits

• DTE Energy is selling our interests in these facilities in order to optimize the cash generated

• The redeployment of this cash will be consistent with our overall investment strategy. Options include:

– New business opportunities– Debt paydown– Share repurchase

Expected Net Cash Flow from Synfuels($US millions)

2003A 2004E 2005E 2006E 2007E 2008E

($200)

$135

$445$510 $530

$135

Expected Net Income from Synfuels($US millions)

2003A 2004E 2005E 2006E 2007E 2008E

$197$150-190

$200-230

$200-230

$200-230

$0

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Waste Coal Recovery is an Exciting New Growth Opportunity

• In the United States, over one billion tons of coal is sitting in waste ponds, with 30 million tons added each year

• In its current state this coal is unusable and is an environmental liability

• DTE Energy owns the right to a proprietary technology that refines this waste coal into a high quality product that can be burned in power plants

• Our first plant is operational, and producing at a rate of ~250,000 tons per year

• We believe that net income of $20-40M is achievable by 2008

Target Regions for Waste Coal Recovery Technology

Site of DTE’s first waste coal recovery plant

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Opportunities in Non-Conventional Gas

Coalbed Coalbed MethaneMethane

Focus AreasFocus AreasCherokee Basin

Arkoma Basin

Michigan Gas Michigan Gas Production Production

RegionRegion

Landfill Gas (Biomass) Facilities

• Very high gas prices and a tight supply situation in North America requires a larger role for non-conventional gas production

• DTE Energy is well-established in both Landfill Gas (Biomass) and in Michigan Gas Production and is looking to make additional incremental investments in these areas

• A newer area of focus is coalbed methane where we can leverage our Michigan Gas Production experience

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Other Non-Regulated Opportunities

Coke Batteries

On-Site Energy Projects• Recently closed two on-site energy transactions• Acquired the utility service assets at eight

DaimlerChrysler sites. Services include steam, chilled water and compressed air under a 20-year contract

• Acquired the on-site energy assets that provide steam and electricity at a Kimberly-Clark tissue mill under a 15-year contract

• Currently, we own interests in three coke batteries which produce metallurgical coke for the steel industry

• The global coke shortage has created new opportunities in this business and we expect the strong prices and tight markets to continue for the longer term

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Balance Sheet Strength and Stability Will be Maintained

• Cash from operations is expected to improve as the rate cases are resolved and the synfuel facilities are fully monetized

• Going forward, the utilities will be expected to cover their capital expenditures and dividends

• Currently DTE Energy is engaged in a cash improvement initiative to help ensure that after capital expenditures and dividends, the company is breakeven on a cash basis

• DTE has $1.5B in credit facilities of which only $500M is currently utilized

Cash from Operations $800

Capital Expenditures (750)

Dividends (353)Asset Sales 40

Cash Flow

($ millions)

$12

Low

Synfuel Production Payment*

Adjusted Cash from Operations

175

$975

$1,050

(1,060)

(353)40

$2

High

225

$1,275

2004E

* Accounted for as ‘investing activity’

Cash Improvement Initiative 100 100

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Summary

• DTE Energy is a strong company with a consistent strategy and a solid asset base

• There are current challenges, but these are being managed with resolution expected in the near future

• The company represents an attractive investment opportunity