Ladies and gentlemen, thank you for standing by. My name is Brent, and I will be your conference operator today. At this time, I would like to welcome everyone to the DTE Energy Fourth Quarter 2022 Earnings Conference Call. [Operator Instructions]. It is now my pleasure to turn today's call over to Barbara Tuckfield, Director of Investor Relations. Ma'am, please go ahead.

Thank you, and good morning, everyone. Before we get started, I would like to remind you to read the safe harbor statement on Page 2 of the presentation, including the reference to forward-looking statements. Our presentation also includes references to operating earnings, which is a non-GAAP financial measure. Please refer to the reconciliation of GAAP earnings to operating earnings provided in the appendix. With us this morning are Jerry Norcia, Chairman, President and CEO; and Dave Ruud, Senior Vice President and CFO. And now I'll turn it over to Jerry to start the call this morning.

Thanks, Barb, and good morning, everyone, and thanks for joining us. I hope everyone is having a healthy and safe year so far. This morning, I'll start by giving you a recap on our outstanding 2022 business performance, provide highlights on how we are well positioned for 2023, and give an overview on the robust opportunities in our long-term plan. Dave Ruud will provide a financial update and wrap things up before we take your questions. I'll begin on Slide 4. We delivered another solid year for all our stakeholders in 2022, which included delivering strong financial results, continuing our excellent track record of creating shareholder value for our investors. I continue to be impressed by our amazing team that delivers exceptional service to our customers and to each other. I always say that employee engagement is the secret sauce that drives our success at DTE. And our team continues to operate at top decile engagement levels as measured by the Gallup organization. This engagement was recognized by earning the Gallup Great Workplace Award for the 10th consecutive year, and is evidenced in a way our team shows up every day. Our team continued to deliver for our customers in 2022. I am very proud that DTE Gas is ranked first in residential customer satisfaction as measured by J.D. Power. This recognition signifies our strong commitment to our customers. We also undertook a number of initiatives to continue to improve electric reliability and we see that paying dividends for our customers. We invested more than $1 billion in our electric grid last year to help improve reliability for our customers. In 2022, the electric grid operated without incidence 99.9% of the time. Across DTE's electric service territory, customers experienced 21% fewer power interruptions in 2022 versus 2021, and the average…

Thanks, Jerry, and good morning, everyone. As Jerry said, we completed another very successful year in 2022, and we are well positioned for 2023 and future growth. I'll start on Slide 10 to review our 2022 financial results. Operating earnings for the year were $1.2 billion. This translates into $6.10 per share, placing us at the high end of the guidance range that we had increased during the year. You can find a detailed breakdown of EPS by segment, including a reconciliation to GAAP reported earnings in the appendix. I'll start the review at the top of the page with our utilities. DTE Electric earnings were $961 million for the year. This was $97 million higher than 2021, driven by the non-recurring $90 million pre-tax tree trim deferral that we did in 2021 to further accelerate our reliability improvement. We also had the accelerated deferred tax amortization in 2022 that was implemented to delay our rate case filings and avoid increasing customer base rates. These earnings increases were partially offset by higher rate base costs and residential sales that were lower in 2022. Moving on to DTE Gas. Operating earnings were $272 million, $58 million higher than 2021. The earnings variance was due to the implementation of base rates and cooler weather, partially offset by higher rate base costs. Let's move to DT Vantage on the third row. Operating earnings were $93 million in 2022. This is an $83 million decrease from last year due to the sunset of the REF business at the end of 2021, partially offset by higher custom energy solutions and RNG earnings in 2022. On the next row, you can see energy trading earnings were lower year-over-year, primarily due to the performance of the power portfolio. This was partially offset by strong physical gas performance.…

Dave and Brent, before we open it up for questions, I would just like to let the community -- investment community know that we had one of our largest ice storms roll through our service territory yesterday and across the whole state of Michigan. And we've got over 400,000 customer outages at this point in time. And I want to give a shout out to our people. Over 2,000 people were in the field today, first thing this morning, dealing with this on a safe -- and trying to restore our customers safely and as quickly as possible. We understand certainly the inconvenience that this causes our customers, but again, our goal with several thousand people in the field this morning is to restore our customers as quickly and as safely as possible. So with that, let's open up for the first question, Brent.

[Operator Instructions]. Your first question is from the line of Shar Pourreza with Guggenheim Partners.

It's actually Constantine here for Shar. Congrats on a great quarter. Certainly appreciate the disclosures around the lower revenue approval. Can you maybe just talk about the changes that are now embedded in that reiterated '23 guidance? And maybe just contrasting with prior years, I think you called out around $100 million of kind of contingency flex. So what would be a good proxy for '23, specifically as we think about lean actions? And what portion was built up in '22, like weather and reinvestment versus more recurring and prospective reductions?

So as Dave mentioned when we had prepared our plans in the fall, prior to the rate case, we had adequate contingency in our plans and had anticipated some of the headwinds from interest expense and inflation. When we received the rate order, it created an incremental approximately $120 million challenge to our plan. And so we go deep into our lean plans and started to exercise our main plans immediately, which is a practice that many of you are familiar with, that we undertake. And the areas that basically we pursued were delaying hiring, reducing contractor workforce and placing our employees into those roles, reducing over time significantly, and deferring maintenance work without sacrificing safety or quality of service. And as you know, when we have years where we experienced favorable outcomes like last year, we start to invest heavily in our maintenance practices. And so this year, we'll be drawing on those banks, if you will.

And I'll just add to that. As soon as we knew that this rehearing was a possibility or that we saw the sales, we went into action building our plans. And now we're tracking this daily in a lot of times and weekly, and we're executing on our plans really well so far this year.

Excellent. And following up on the parent guidance and wholesale debt, as you mentioned, it looks like '23 is relatively flat to '22. Can you talk about the interest rate assumptions and refinancing needs that you're embedding at this point, utility bonds continue to hover in the high 5s range? And is that fully embedded in both the '23 guidance and the reiterated 6% to 8%?

Yes, it is. At the highest level, we've incorporated increasing interest rates in our plans for our 5-year plan. At the holding company, right, we don't have any retirements in '23 other than this $800 million of outstanding term loan. And for that, we've entered into some floating defects to make sure we reduce any exposure to interest rate volatility in '23. And then in '24 and '25 and beyond, we've conservatively modeled rates in our plan and look for opportunities to bring that in even more favorably as we go forward.

Excellent. And last quick one, just housekeeping on the DTE Vantage side. Have you seen any shifts in economics and valuation in the business as it relates to specifically the non-solutions businesses like RNG? We've seen a lot of new entrants and private equity engagement on that front. So kind of does that make it more or less attractive versus development like carbon capture or any other emerging solutions?

I can start, and Dave can add. Certainly, we're seeing very aggressive values for RNG transactions. That's encouraging in terms of value for our assets. And we are starting to look at a handful of opportunities in carbon cash in storage, especially with the IRA providing significant tax credit uplift in that business. And we're looking at very small projects to sort of get our feet wet, if you will, in that process with our expertise in storage and pipeline work as well as processing. So Dave, do you want to add to that?

I agree. I think -- all I was going to add is that the IRA has made some of these projects more attractive. So we do see some additional competition, but we also have some of our own -- our own landfill gas projects that we can work for conversions that can be very attractive for us in the future, too.

And just any thoughts on capital rotation within that business or more kind of toe-in-the-water approach?

At this point in time, there's no definitive plans for capital rotation, but I -- we're constantly looking at those types of opportunities. We've got a track record of rotating capital out of our non-utility businesses and helping to fund some of our utility work. At this point, you would notice that we have very little equity needs. So we're trying to certainly match up sort of financing needs with potential rotations in the future. So we'll see more to come on that as we go, but certainly always open to anything that creates accretion opportunities for our investors.

Your next question is from the line of Nick Campanella with Credit Suisse.

This is Steve for Nick today. Yes. So first question is on the regulatory strategy. As you mentioned, to continue practice of pursuing a settlement with all stakeholders. Could you just update us on this front? And how should we view this new rate case filing just different from the last one filed earlier last year? Also recognizing PSC's comments on the rehearing process, I think it's -- I think although the request was denied the commissioners believes that DTE comes in with a very constructive approach and willing to negotiate them. And also just on the electric side, I think mostly rate cases have been conducted through litigation. Can you just help us better understand the electric rate case filing strategy with these backdrops?

Sure. So our intent -- we've got 2 major regulatory initiatives this year. One is the integrated resource plan that will conclude in the second half of this year and then our electric general rate case that will conclude in December. We are very interested in settling both. And I would say that in the first instance, with the integrated resource plan, many of the parties that are involved are very interested in settlement discussions. We've had our first set of discussions, which are encouraging, and we seek to settle that case, which is the integrated resource plan. Later in this year, we will start those conversations for settlement around the electric rate case. We do have a history of settling gas cases in many of our renewable regulatory filings as well as our cost recovery factor filings and GCRs have been settled in the past. So we know how to do this and have done it, and we will pursue it in these 2 major regulatory initiatives this year.

This is really helpful. And just quickly on the '23 guide, you provisioned from midpoint. And given all the mitigation strategy, can you just comment on -- just how should we think about -- I think it was a timely call on the storm cost or any weather conditions that could throw you off this midpoint, how much or how should we think of -- have you provisioned for that?

Well, certainly, the contingency that we walk into the year with is exactly for these purposes, whether it's deviations in weather or -- we do carry a storm budget as part of our base plan. And then, of course, if storm costs exceed plan, and that's what contingency may be used for, or it maybe used for weather variations. So I would say that we have adequate contingency at this point in time based on what we've seen so far in the year. And as we consume contingency, as I mentioned before, we go into deeper lean actions to try and restore contingency, especially as we head into the summer season, which is really our biggest opportunity to create value for our shareholders. That's when we really want to make sure that most of our contingency is intact.

Your next question is from the line of Julien Dumoulin-Smith with Bank of America.

This is for Julien. And congrats on today's results. Just the first question, kind of coming back to the 2023 O&M cuts. You mentioned historic success in executing on these cuts with COVID in the last recession. Do you perceive any risk, I guess, at this time around, once again executing on O&M costs, given, A, the inflationary cost backdrop we've seen; and then B, a bit higher scrutiny from Michigan regulator across Michigan utilities on vegetation management efforts, particularly with the 2022 storm docket?

Yes. So let me start with vegetation management first. We've got our largest vegetation management program that we've ever had historically in our company. Back in 2013, we were investing about $65 million a year in vegetation management. And several years ago, we came up with a creative solution with the commission to basically more than triple the investment in vegetation management. This year, for example, we will invest over $200 million in vegetation management. And we actually agreed to amortize those costs over time in order to smooth out the impact to our customers, but still give the customers -- our customers the benefit of reliability improvements. And as I mentioned in my comments, I think the commission would agree that we've had significant impact on reliability where we have taken on a very aggressive tree trimming as well as hardening of the system by replacing poles and wires and transformers. So very significant investments in the grid. And while we've completed that work, we've had significant improvements in the liability. So we feel good about the work that we're doing. We were always looking for opportunities to do even better. And we believe that, that's what the process that the commission has initiated is really about, is really finding joint opportunities to accelerate and improve processes to make our investments even more effective than they have been. So I'm excited about that. In terms of cost reductions, your first question, we are undertaking many of these onetime actions in order to accommodate the challenge that we received late last year. And we feel pretty confident in executing those. We know they are onetime, they're not sustainable. Things like not hiring people or suspending tiring. We do need to replace critical positions in our company over time. And not to say that there's not potential efficiency opportunities that we will pursue. Some of this could stick. I mean, that's the opportunity that we're faced with. But a lot of these actions are onetime and not sustainable in nature and also deferring maintenance work. We can do that for short periods of time, but certainly cannot do that for a long period of time. Hopefully, that helps.

Yes. And as we built these plans, we were very careful to ensure that we weren't going to impact -- first of all, never impact safety. Nothing that would impact reliability or our ability to deliver for our customers. And so these plans are built with that in mind. So it should fit well even though they're unsustainable in the future should fit well with what we're trying to continue to do for our customers.

Understood. That's helpful. And then just kind of switching gears a bit here. I know we've seen some recent headlines detailing, for example, plans for large-scale battery manufacturing facilities in Michigan to service electric vehicles. So -- just kind of wondering what you're seeing in terms of new industrial load and if any of that will kind of accrue favorably to DTE in terms of higher electric load.

Certainly, last year, General Motors announced the battery plant and battery operation -- assembly operations in our service territory. And certainly, we're really excited about that. In the past year, we also saw One Energy announced a new battery plant in our service territory. In addition to that, the University of Michigan announced a multibillion-dollar investment program right next door to our headquarters for an innovation center, which will drive economic growth and development in the city of Detroit. And most recently, the Henry Ford Hospital system is rebuilding their hospital campus in downtown Detroit with a multibillion dollar investment as well, which will create new jobs, new economic development activity. And those are some of the big ones that I mentioned, but there are so many others. In my time at DTE, this has probably been the most active economic development period that I've seen. So we're pretty excited about growth both in the industrial and commercial sector, which ultimately, as you know, will drive growth in residential investment as well and commercial investment to support those industries.

Your next question is from the line of Angie Storozynski with Seaport.

So just going back to the rate case strategy. And I know that we are maybe over analyzing this. But I'm just -- I mean, you have another rate case filing, a big one, this time. Are there any lessons learned from the previous case then that you've embedded in this filing? So any changes in the strategy? Some, I don't know, outreach to the commission and the staff ahead of it? So that's one. Number 2 is, how are the residential sales trending vis-a-vis the past rate case and the current rate case? I mean, are you seeing any deterioration in sales versus what you had expected? And then lastly, you mentioned, I think, as far as the gas rate cases that you might elongate the time in between the rate cases. And I'm just debating with myself if that's the right strategy given that, that maybe increases the amount of the ask in the next rate case, if you stay out. Again, just trying to have some lessons learned from the outcome of the last rate case on the electric side.

Sure. So let me start with, Angie, the lessons learned, and I'll have Dave talk about sales. And then we can talk about the gas freight case strategy as well. So as we reflect on the outcome, certainly, the major issue there was sales volume forecast. And again, it's -- and Dave will talk about how our sales are tracking, but they're essentially tracking as we had expected. And -- but I this will be resolved in the next rate case. Sales will not be a mystery. So that's point number one. That was the biggest fundamental deviation, if you will, in this last rate case. But again, we dug deeper than that, Angie, and said, how can we improve, what we file. So we've taken another really deep inspection and review of all of our filings to make sure that they're well supported, well understood, continue to be well understood in order to get a better understanding with the staff and the commission and other interveners as to what is it that we're trying to accomplish with this significant investment profile that we have with directed at our grid as well as our renewable assets. So a lot of work went into, what I would say, continue to improve and continuously improve the quality of our submission. So that's something that we did. As well as we spent a lot of time ahead of the rate case, creating context, not only for the commission, but also for some of our interveners as that what are these investments pointed at and why is this fundamental? And if you look at the ice storm that rolled through our territory today, I would say it certainly further reinforces the need to invest in our grid as we see these climate change patterns…

Sure. Yes, Jerry. Yes. As Jerry mentioned, our sales are tracking pretty well to our forecast. And I think as end-to-end to what we have in the filing. And I think what will be the benefit going into this filing is we'll have some more stability because you saw our sales and particularly our residential sales from 2022 versus 2021. They were down about 3% with people returning to work. As we look to our forecast in our test year, it's down a little under 2% from that level. So far in the early months, we're seeing that we're tracking like right on that level. And so we think we'll come in at a forecast that will be a lot more agreeable as we go forward. And overall, from pre-pandemic levels to where we are in our test year, it's up about 1.5% to 2%, too. So I think it's all triangulating really well.

And in terms of the gas rate case, Angie, we're looking to file late this year is the current plan.

Okay. And then -- just 1 follow-up. So one is you mentioned all of this outreach. I mean, what -- again, I want to believe. But what I'm trying to say is that this rate case is -- next electric rate case happened in such a proximity to the decision in the previous rate case. And I'm just, again, wondering how -- how could you have embedded the lessons learned in such a short period of time. So that's one. And number 2 is, probably even more importantly. So over the years, you guys have always had this early earnings look, right, guidance and then it would gradually increase through the course of the year. And I'm -- and as we look from a far, we're just wondering if a conservative sales forecast where partly the reason why you were able to historically beat numbers -- i.e., should we assume that the current guidance is also conservative, even given the outcome of this electric rate case?

So let me start with the first question, how did we start on these lessons learned. We started that really early in the summer. We always get feedback from the staff through their questions and through their commentary. And we started to really sharpen our focus on improving quality of submissions going into this rate case. So we were working on this rate case before -- months and months before. Probably 6 months before we even got the results in November. So it did start and then I think it's intensified once we got the result. And the outreach certainly intensified after the result in November because we felt the need -- great context for the fact that, hey, we've stayed out of a rate case for 4 years and we've invested $8 billion. And we -- and the feedback we're getting is there's very strong support for that investment. And unfortunately, we had a mishap with the sales forecast in the last rate case, but I think that will get corrected. And there will be strong support for the investments that we're making and continue to make. So -- so that would sort of summarize the rate case part of it. In terms of the forecast, I would say, as Dave said, we are tracking right towards the midpoint at this point in time. And that's our goal. And all of the cost initiatives that we have undertaken, Dave and I review them weekly, and the rest of our team is reviewing it out daily. And we're right on top of that plan. So we feel good about where we're at. We're also looking to restore contingency as it gets consumed sometimes by weather. So that's where we're at. So we're confident in hitting our midpoint at this point in time as we look at our outlook.

Your next question is from the line of David Arcaro with Morgan Stanley.

I was wondering if -- let's see, on the IRM that you are proposing in the electric rate case, how long could that lead you to potentially consider staying out of rate cases to the extent you're successful in getting that applied here?

Well, the positive side of the IRM is that we've been talking to the commission about it for years. And as you saw in the last rate case, they invited us to file one. So there's strong alignment in order -- in terms of creating the IRM. And we think that, that, as you know, in our gas company has simplified greatly the regulatory process for capital that's not disputed, if you will, that needs to be invested. And it's going to be primarily directed -- actually not primarily, it will be directed at the grid. That's what the IRM will be used for. And it will build over time. So it's going to take a few years before it starts to have an impact on the timing of rate cases. But to give you an example, as we built it up in the gas business, it allowed us to stay out for 2 and 3 years at a time. And that's certainly the case this time. We've stayed out for at least several years already in the gas company. So we expect that to happen with the electric business. As we build confidence in the IRM, we'll start with modest amounts going into the IRM, as you've seen in our rate case filings, and that will build over a 3-year period. And we'll get used to working together on that because it does take some time to build confidence in the execution as well as the management of the IRM. So we're taking a page out of the gas playbook to build up this IRM and achieve our goals of making the necessary investments as well as starting to put time between rate cases. So it will take a few years as my answer before we start to see a significant impact on timing of rate cases.

Okay. Got it. That makes sense. I appreciate that context. And then, was curious, obviously, the decline in natural gas prices that we've seen is a nice tailwind for customer bills. But when -- just based on kind of storage levels and the seasonal use of that gas, when would customers potentially see the lower prices flow through into rates?

They're seeing it right now. As a matter of fact, I was talking to the President of the gas company the last couple of days. We're going to lower the factor by about $1 here in the next little while. So we're seeing the prices come down quite nicely from their peak.

Got it. And could that lead to a year-over-year decline overall in the fuel portion of gas? Or is that going to take still some time to kind of flow through the higher-priced gas that might have been collected late last year?

I think we've already seen a year-over-year decline, and it will continue to decline. We've made a series of reductions already in the last several months in our gas prices. Our gas recovery, that's a factor. And the most significant one is coming here very shortly. It's about $1 decline in price.

Your next question is from Michael Sullivan with Wolfe Research.

Maybe just wanted to flip over to the IRP. I think we have intervenor testimony coming up in the next couple of weeks here. Just what should we expect from that? And then -- in terms of settlement timing, what should we think about as coming first between the IRP and the electric case?

So I'll start by saying that the expectations that we see is there'll be challenge to the timing of some of our retirements, especially the Monroe Power Plant. So I think you'll see that. We won't be surprised by that. And we will also perhaps see some desire to increase energy efficiency. I think many -- some parties will challenge natural gas as a future reliability source. And of course, we've got strong views on that, that the natural gas enables a large build-out of renewables as technology continues to improve around providing baseload generation. So I think those are -- those will be the issues, if you will. And -- but there's strong support for a large portion, I believe, of our IRP. At least that's our early indication that it's received favorable reviews informally, if you will. So -- we look forward to the testimony that will be filed. In terms of timing of settlements, we expect that the IRP will be settled first just because it was filed before the rate case and just the timing of testimony and process puts the rate case a little behind the IRP in terms of the opportunity for settlement discussions. So that's how we expect the process to unfold.

Okay. Great. That's helpful. And then maybe a question for Dave. Just in terms of the FFO to debt, you target the 15% to 16%. Can you give us an indication of where 2022 finished up? And then to what extent you're still waiting on deferred power fuel cost recovery into this year?

Yes. That's a good question. Yes. '22 ended up right around 15%. And as you mentioned, the big driver of that being a little lower was the fuel cost recovery. So we had our power supply cost recovery was a use of cash for us in '22, but will be more of a source of cash as we're recovering, the majority of that in 2023. So we'll see our FFO to debt be a little bit higher, a little bit better in 2023.

Your next question is from the line of Andrew Weisel with Scotiabank.

Appreciate the detailed answers to the previous questions. You covered a lot of what I wanted. Just 2 follow-ups maybe for me then. First, in terms of the sales forecast, obviously, that was a big difference of opinion in the last rate case. Does that change have any impact on the IRP and the long-term outlook for capacity resource needs?

We had built that in, Andrew, into IRP forecast. Now of course, what we do in an IRP is we provide for scenarios for demand increases, both the largest demand increase opportunity is really EV attachments and some of the economic development activity that we expect in the near term. But we try to build an IRP that not only addresses point estimates, but also a range and scenarios and forecast. And that's something that is required by the IRP filing guidelines, and I think -- we think it's a very wise thing to do because, obviously, over a period of 20 years, there can be a significant amount of variability in demand forecast. So we provide low, medium and high type of forecast.

Okay. And you're still in that range, essentially?

Yes. Yes.

Okay. Great. Then lastly, on equity, the sources and uses of cash page, Slide 17, shows zero or a little dash, I suppose, for new equity. But in one of your earlier slides, you talked about up to $100 million per year. How likely is that to remain zero? Is that a function of the timing of CapEx or the $1.3 billion convertible last year? Just trying to understand why that's 0 and not something greater than zero.

Yes. Our goal there will be to keep that as low as possible, obviously, and how we generate cash and how we get cash through our plan will be one of the big drivers of that and how we use it in CapEx. So we see in our plan minimal equity issuances, hopefully in that around 0, but it could be in the 0 to 100 range as we go forward.

Okay. So it's zero for the entire 3-year period is a realistic possibility?

It's a possibility. I would expect some internal equity issuances that we have through our internal sources, though.

Your next question is from the line of Anthony Crowdell with Mizuho.

Well, again, I hope the restoration efforts go quickly. I'm sure it's a grind for all the workers out there. So fingers crossed.

We're really proud of our people out there. They're braving these elements, and we just hope for their safety and good health, and certainly the same for our customers.

Yes, I'm sure we all take for granted the service we get provided in our electric system and gas. Just 2 quick ones. One on the IRM filing or request. And I apologize if I had this wrong, has DTE requested that for the Electric segment before? And just what -- if so, what gives you this optimism that this time, maybe it gets approved?

The last time we did it, Anthony, we requested a really large IRM amount. And this is like over a handful of years ago. And this time -- and it was -- I felt at that time the feedback we got that, maybe it was too big the request. And we were trying to make it big enough to stay out of rate cases immediately, so that there would be an immediate benefit to us and many other interested parties not having to have rate cases every year. Well, this time, we've taken a different approach. We've made it smaller in the early years, which may have us -- may create a little more work as you're in for both rate cases and reconciliations in the early years on the IRM. But over time, it will start to put distance between rate cases as we grow it. And I think it will give the party -- all parties involved confidence that we're executing well on the IRM. So that's why we took a little different approach this time. and we feel that it will be successful. We socialized it ahead of time before we filed and got very strong positive feedback. So we feel good about it this time.

Do you guys ever estimate or provide what the cost is to file a rate case if I think of all the DTE personnel that have to go around aggregating data, all the test running, you add all that up. Is there a value that you guys have put out on that, that may be an IRM and again, you guys have been very clear and very modest in the beginning. It will take years before you start seeing ever delay rate filings. But what's the potential savings that a customer sees if you're able to lay a rate filing?

I would say there are, of course, the costs of sort of prosecuting a case, if you will, for us and for our interveners and for the commission. So we'll reduce that. And I think that will be significant. But I think the more significant piece, Anthony, will be the fact that once we have certainty of an investment profile, from a supply chain perspective, we can start preordering materials and working out supply arrangements that are much more efficient over the long term, over 3 to 5 years. and lining up our contractors where the bulk of the cost is and extracting value from them on behalf of our customers. So I would say the beauty of the IRM that we saw in the gas business is you can start lining up major supply chain and initiatives and also contractors to extract efficiencies. When you can commit to somebody for 5 years, there's a huge incentive to for them to respond to our efficiency initiatives. So that's where I see millions of dollars of potential savings in capital and the ability to accelerate our work.

Great. And just lastly, DTE Vantage, I love the guidance you've given out, I believe, till 2027. Can I think of the growth from '23 to '27 as linear? Or is it more back-end loaded? Like, just any clarity on the growth in earnings at DTE Vantage?

Typically, we're targeting that $15 million to $18 million, Anthony, of growth advantage to support that forecast. So that's what the team passed with each and every year and sometimes they beat it, sometimes it's lower. But overall, it averages out to about $15 million to $18 million a year of income growth. And a lot of it is -- we can look to it coming because we've got these landfill projects that are under our current control that we can convert to RNG. And so we've got a nice line of sight at least over the next 2 or 3 years into project development.

Ladies and gentlemen, that is all the time we have for questions today. I would now like to turn the call back to Mr. Jerry Norcia.

Well, thank you, everyone, for joining us today. And I'll just close by saying we had another strong year in 2022, and I'm feeling really good about 2023 and our position for the long-term future. So I hope everyone has a great morning, and stay healthy. Thank you.

Ladies and gentlemen, thank you for participating. This concludes today's conference call. You may now disconnect.