DETROIT EDISON CO (Form: 10-Q, Received: 08/09/2006 14:55:18)

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934

For the Quarterly Period ended June 30, 2006

Commission file number 1-2198

The registrant meets the conditions set forth in General Instruction H (1) (a) and (b) of Form 10-Q and is, therefore, filing this Form with the reduced disclosure format.

THE DETROIT EDISON COMPANY

(Exact name of registrant as specified in its charter)


Michigan		38-0478650
(State or other jurisdiction of		(I.R.S. Employer
incorporation or organization)		Identification No.)

2000 2nd Avenue, Detroit, Michigan		48226-1279
(Address of principal executive offices)		(Zip Code)

313-235-4000
(Registrant’s telephone number, including area code)

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

Yes þ No o

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, or a non-accelerated filer. See definition of “accelerated filer and large accelerated filer” in Rule 12b-2 of the Exchange Act.


Large accelerated filer o		Accelerated filer o		Non-accelerated filer þ

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

Yes o No þ

The Detroit Edison Company

Quarterly Report on Form 10-Q
Quarter Ended June 30, 2006

Table of Contents


			Page

Definitions				1

Forward-Looking Statements				2

Part I — Financial Information

	Item 1.	Financial Statements

		Consolidated Statement of Operations		7

		Consolidated Statement of Financial Position		8

		Consolidated Statement of Cash Flows		10

		Consolidated Statement of Changes in Shareholder’s Equity and Comprehensive Income		11

		Notes to Consolidated Financial Statements		12

	Item 2.	Management’s Narrative Analysis of Results of Operations		3

	Item 4.	Controls and Procedures		6

Part II — Other Information

	Item 1.	Legal Proceedings		21

	Item 6.	Exhibits		21

Signature				22
Twentieth Supplemental Indenture, dated May 15, 2006
Indenture, Dated May 15, 2006
Computation of Ratios of Earnings to Fixed Charges
Chief Executive Officer Section 302
Chief Financial Officer Section 302
Chief Executive Officer Section 906
Chief Financial Officer Section 906

Definitions


Customer Choice		Statewide initiatives giving customers in Michigan the option to choose alternative suppliers for electricity.

Detroit Edison		The Detroit Edison Company (a direct wholly owned subsidiary of DTE Energy) and any subsidiary companies

DTE Energy		DTE Energy Company, the parent of Detroit Edison and directly or indirectly the parent company of numerous non-utility subsidiaries

EPA		United States Environmental Protection Agency

FERC		Federal Energy Regulatory Commission

ITC		International Transmission Company (until February 28, 2003, a wholly owned subsidiary of DTE Energy)

MPSC		Michigan Public Service Commission

NRC		Nuclear Regulatory Commission

PSCR		A power supply cost recovery mechanism authorized by the MPSC that allows Detroit Edison to recover through rates its fuel, fuel-related and purchased power expenses. The clause was suspended under Michigan’s restructuring legislation (signed into law June 5, 2000), which lowered and froze electric customer rates. The clause was reinstated by the MPSC effective January 1, 2004.

Securitization		Detroit Edison financed specific stranded costs at lower interest rates through the sale of rate reduction bonds by a wholly owned special purpose entity, the Detroit Edison Securitization Funding LLC.

SFAS		Statement of Financial Accounting Standards

Stranded costs		Costs incurred by utilities in order to serve customers in a regulated environment that absent special regulatory approval would not otherwise expect to be recoverable if customers switch to alternative energy suppliers.

Units of Measurement

gWh		Gigawatthour of electricity

kWh		Kilowatthour of electricity

MW		Megawatt of electricity

MWh		Megawatthour of electricity

Forward-Looking Statements

Certain information presented herein includes forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements involve certain risks and uncertainties that may cause actual future results to differ materially from those contemplated, projected, estimated or budgeted. There are many factors that may impact forward-looking statements including, but not limited to, the following:

•		the effects of weather and other natural phenomena on operations and sales to customers, and purchases from suppliers;

•		economic climate and population growth or decline in the geographic areas where we do business;

•		environmental issues, laws, regulations, and the cost of remediation and compliance;

•		nuclear regulations and operations associated with nuclear facilities;

•		implementation of the electric Customer Choice program;

•		impact of electric utility restructuring in Michigan, including legislative amendments;

•		employee relations and the impact of collective bargaining agreements;

•		unplanned outages;

•		access to capital markets and capital market conditions and the results of other financing efforts that can be affected by credit agency ratings;

•		the timing and extent of changes in interest rates;

•		the level of borrowings;

•		changes in the cost and availability of coal and other raw materials, and purchased power;

•		effects of competition;

•		impact of regulation by the FERC, MPSC, NRC and other applicable governmental proceedings and regulations;

•		changes in and application of federal, state and local tax laws and their interpretations, including the Internal Revenue Code, regulations, rulings, court proceedings and audits;

•		the ability to recover costs through rate increases;

•		the availability, cost, coverage and terms of insurance;

•		the cost of protecting assets against, or damage due to, terrorism;

•		changes in and application of accounting standards and financial reporting regulations;

•		changes in federal or state laws and their interpretation with respect to regulation, energy policy and other business issues;

•		uncollectible accounts receivable;

•		litigation and related appeals; and

•		changes in the economic and financial viability of our suppliers, customers and trading counterparties, and the continued ability of such parties to perform their obligations to Detroit Edison.

New factors emerge from time to time. We cannot predict what factors may arise or how such factors may cause our results to differ materially from those contained in any forward-looking statement. Any forward-looking statements speak only as of the date on which such statements are made. We undertake no obligation to update any forward-looking statement to reflect events or circumstances after the date on which such statement is made or to reflect the occurrence of unanticipated events.

The Detroit Edison Company

Management’s Narrative Analysis of Results of Operations

The Management’s Narrative Analysis of Results of Operations discussion for Detroit Edison is presented in accordance with General Instruction H(2) (a) of Form 10-Q.

Factors impacting income : Net income increased $14 million during the 2006 second quarter and $18 million in the 2006 six-month period. These results primarily reflect higher gross margins, partially offset by higher operation and maintenance expenses, including implementation costs associated with our Performance Excellence Process, and increased depreciation and amortization expenses


Increase (Decrease) in Income Statement Components	Three		Six
Compared to Prior Year	Months		Months

(in Millions)
Operating Revenues	$	140	$	200
Fuel and Purchased Power		66		74

Gross Margin		74		126
Operation and Maintenance		39		62
Depreciation and Amortization		8		25
Taxes Other Than Income		2		2

Operating Income		25		37
Other (Income) and Deductions		4		10
Income Tax Provision		7		9

Net Income	$	14	$	18

Gross margins increased $74 million during the 2006 second quarter and $126 million in the 2006 six-month period. The quarterly and year to date improvements were primarily due to lower electric Customer Choice penetration and increased rates due to the expiration of the residential rate cap on January 1, 2006, partially offset by milder weather in 2006.


Increase (Decrease) in Gross Margin Components	Three			Six
Compared to Prior Year	Months			Months
(in Millions)
Weather related margin impacts	$	(21	)	$	(31	)
Removal of residential rate caps effective January 1, 2006		32			54
Return of customers from electric Customer Choice		37			66
Service territory economic performance		5			19
Other, net		21			18

Increase in gross margin performance	$	74		$	126


	Three Months Ended						Six Months Ended
	June 30						June 30
Power Generated and Purchased	2006			2005			2006			2005
(in Thousands of MWh)
Power Plant Generation
Fossil		9,206			9,546			18,515			19,310
Nuclear		922			2,272			3,118			4,325

		10,128			11,818			21,633			23,635
Purchased Power		3,318			1,331			4,832			2,809

System Output		13,446			13,149			26,465			26,444
Less Line Loss and Internal Use		(856	)		(752	)		(1,681	)		(1,349	)

Net System Output		12,590			12,397			24,784			25,095


Average Unit Cost ($/MWh)
Generation (1)	$	16.41		$	14.66		$	15.48		$	14.53

Purchased Power	$	54.03		$	85.66		$	52.89		$	66.51

Overall Average Unit Cost	$	25.69		$	21.85		$	22.31		$	20.05


(1)		Represents fuel costs associated with power plants.

Three Months Ended

Six Months Ended

(in Thousands of MWh)

June 30

2006

2005

2006

2005

Electric Sales

Residential

3,514

3,766

7,350

7,817

Commercial

4,506

3,820

8,513

7,184

Industrial

3,209

3,024

6,363

5,920

Wholesale

702

557

1,377

1,120

Other

197

193

12,020

11,255

23,800

22,234

Interconnections sales (1)

570

1,142

984

2,861

Total Electric Sales

12,590

12,397

24,784

25,095

Electric Deliveries

Retail and Wholesale

12,020

11,255

23,800

22,234

Electric Choice

984

1,996

2,347

3,910

Electric Choice — Self Generators (2)

127

174

478

366

Total Electric Sales and Deliveries

13,131

13,425

26,625

26,510


(1)		Represents power that is not distributed by Detroit Edison.

(2)		Represents deliveries for self generators who have purchased power from alternative energy suppliers to supplement their power requirements.

Operation and maintenance expense increased $39 million in the second quarter of 2006 and $62 million in the 2006 six-month period due primarily to higher plant outage expense and implementation costs associated with the Performance Excellence Process.

Depreciation and amortization expense increased $8 million in the second quarter of 2006 and $25 million in the 2006 six-month period due to increased amortization of regulatory assets.

Other income and deductions expense increased $4 million in the 2006 second quarter and $10 million in the 2006 six-month period, primarily due to higher interest expense.

Outlook — We continue to improve the operating performance of Detroit Edison. During the past year, we have resolved many of our regulatory issues and continue to pursue additional regulatory solutions for structural problems within our competitive environment, mainly electric Customer Choice and the need to adjust rates for each customer class to reflect the full cost of service. In March 2006, the MPSC issued an order directing Detroit Edison to show cause by June 1, 2006 why its retail electric rates should not be reduced in 2007. We filed our response on June 1, 2006. We are unable to predict the outcome of this proceeding or its effect. In April 2006, an MPSC Administrative Law Judge issued a Proposal for Decision (PFD) indicating that Detroit Edison’s position in the 2004 PSCR Reconciliation and the 2004 Net Stranded Cost Case proceeding is overstated. The considerations in the case include recovery of stranded cost, associated production operation and maintenance expenses and interest on the 2004 PSCR balance. Based on the recommendations outlined in the PFD, the potential outcome in the case is a reduction of net income in the range of $15 million to $50 million.

Concurrently, we will move forward in our efforts to improve performance. Looking forward, additional issues, such as rising prices for coal, uranium and health care and higher levels of capital spending, will result in us taking meaningful action to address our costs while continuing to provide quality customer service. We will utilize the DTE Operating System and the Performance Excellence Process to seek opportunities to improve productivity, remove waste, decrease our costs, while improving customer satisfaction. We anticipate accruing additional implementation charges in 2006 and 2007. Detroit Edison seeks MPSC authorization to defer and amortize Performance Excellence Process implementation costs for accounting purposes to match the expected savings from the Performance Excellence Process program with the related costs to achieve.

Long term, we will be required to invest an estimated $2.4 billion on emission controls through 2018. Should we be able to recover these costs in future rate cases, we may experience a growth in earnings. Additionally, our service territory may require additional generation capacity. A new base-load generating plant has not been built within the State of Michigan in the last 20 years. Should our regulatory environment be conducive to such a significant capital expenditure, we may build or expand a new base- load coal or nuclear facility, with an estimated cost of $1 billion to $2 billion for a new coal plant.

The following variables, either in combination or acting alone, could impact our future results:

	•		amount and timing of cost recovery allowed as a result of regulatory proceedings, related appeals, or new legislation;

	•		our ability to reduce costs and maximize plant performance;

	•		variations in market prices of power, coal and gas;

	•		economic conditions within the State of Michigan;

	•		weather, including the severity and frequency of storms; and

	•		levels of customer participation in the electric Customer Choice program.

We expect cash flows and operating performance will continue to be at risk due to the electric Customer Choice program until the issues associated with this program are adequately addressed. We will accrue as regulatory assets any future unrecovered generation-related fixed costs (stranded costs) due to electric Customer Choice that we believe are recoverable under Michigan legislation and MPSC orders. We cannot predict the outcome of these matters. See Note 3.

CONTROLS AND PROCEDURES

(a) Evaluation of disclosure controls and procedures

Management of the Company carried out an evaluation, under the supervision and with the participation of the Company’s Chief Executive Officer and Chief Financial Officer, of the effectiveness of the design and operation of the Company’s disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) as of June 30, 2006, which is the end of the period covered by this report. Based on this evaluation, the Company’s Chief Executive Officer and Chief Financial Officer have concluded that such controls and procedures are effective in ensuring that information required to be disclosed by the Company in reports that it files or submits under the Exchange Act, is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by the Company in the reports that it files or submits under the Exchange Act is accumulated and communicated to the Company’s management, including its Chief Executive Officer and Chief Financial Officer, as appropriate to allow timely decisions regarding required disclosure. Due to the inherent limitations in the effectiveness of any disclosure controls and procedures, management cannot provide absolute assurance that the objectives of its disclosure controls and procedures will be met.

(b) Changes in internal control over financial reporting

There has been no change in the Company’s internal control over financial reporting during the quarter ended June 30, 2006 that has materially affected, or is reasonably likely to materially affect, the Company’s internal control over financial reporting.

The Detroit Edison Company

Consolidated Statement of Operations (unaudited)


	Three Months Ended						Six Months Ended
	June 30						June 30
(in Millions)	2006			2005			2006			2005

Operating Revenues	$	1,175		$	1,035		$	2,225		$	2,025


Operating Expenses
Fuel and purchased power		409			343			718			644
Operation and maintenance		369			330			713			651
Depreciation and amortization		168			160			335			310
Taxes other than income		65			63			134			132

		1,011			896			1,900			1,737


Operating Income		164			139			325			288


Other (Income) and Deductions
Interest expense		76			69			148			133
Interest income		(1	)		—			(1	)		(1	)
Other income		(6	)		(7	)		(13	)		(13	)
Other expenses		10			13			20			25

		79			75			154			144


Income Before Income Taxes		85			64			171			144

Income Tax Provision		28			21			55			46


Net Income	$	57		$	43		$	116		$	98

See Notes to Consolidated Financial Statements (Unaudited)

The Detroit Edison Company

Consolidated Statement of Financial Position


	(Unaudited)
	June 30			December 31
	2006			2005
(in Millions)
ASSETS
Current Assets
Cash and cash equivalents	$	27		$	26
Restricted cash		82			84
Accounts receivable
Customer (less allowance for doubtful accounts of $61 and $54, respectively)		596			528
Other		132			112
Accrued power supply cost recovery revenue		214			144
Inventories
Fuel		145			123
Materials and supplies		119			116
Other		68			43

		1,383			1,176


Investments
Nuclear decommissioning trust funds		679			646
Other		67			65

		746			711


Property
Property, plant and equipment		13,533			13,416
Less accumulated depreciation		(5,451	)		(5,595	)

		8,082			7,821


Other Assets
Regulatory assets		1,963			2,006
Securitized regulatory assets		1,289			1,340
Other		116			115

		3,368			3,461


Total Assets	$	13,579		$	13,169

See Notes to Consolidated Financial Statements (Unaudited)

The Detroit Edison Company
Consolidated Statement of Financial Position


	(Unaudited)
	June 30			December 31
	2006			2005
(in Millions, Except Shares)
LIABILITIES AND SHAREHOLDER’S EQUITY
Current Liabilities
Accounts payable	$	419		$	392
Accrued interest		80			79
Dividends payable		76			76
Accrued vacations		82			80
Short-term borrowings		176			163
Accrued power supply cost recovery		135			129
Current portion of long-term debt, including capital leases		137			135
Other		225			208

		1,330			1,262


Other Liabilities
Deferred income taxes		1,921			1,961
Regulatory liabilities		241			224
Asset retirement obligations (Note 1)		985			953
Unamortized investment tax credit		110			115
Nuclear decommissioning		90			85
Accrued pension liability		315			261
Other		782			787

		4,444			4,386


Long-Term Debt (net of current portion)
Mortgage bonds, notes and other		3,452			3,221
Securitization bonds		1,238			1,295
Capital lease obligations		53			57

		4,743			4,573


Contingencies (Notes 3 and 5)

Shareholder’s Equity
Common stock, $10 par value, 400,000,000 shares authorized, 138,632,324 shares issued and outstanding		1,386			1,386
Additional paid in capital		1,254			1,104
Common stock expense		(44	)		(44	)
Retained earnings		464			500
Accumulated other comprehensive income		2			2

		3,062			2,948


Total Liabilities and Shareholder’s Equity	$	13,579		$	13,169

See Notes to Consolidated Financial Statements (Unaudited)

The Detroit Edison Company

Consolidated Statement of Cash Flows (Unaudited)


	Six Months Ended
	June 30
	2006			2005
(in Millions)
Operating Activities
Net Income	$	116		$	98
Adjustments to reconcile net income to net cash from operating activities:
Depreciation and amortization		335			310
Deferred income taxes		5			(10	)
Changes in assets and liabilities, exclusive of changes shown separately (Note 1)		(111	)		59

Net cash from operating activities		345			457


Investing Activities
Plant and equipment expenditures		(512	)		(321	)
Proceeds from sale of other assets, net		18			—
Restricted cash for debt redemptions		2			6
Notes receivable from affiliate		—			85
Proceeds from sale of nuclear decommissioning trust funds		99			112
Investment in nuclear decommissioning trust funds		(118	)		(130	)
Other investments		(15	)		(29	)

Net cash used for investing activities		(526	)		(277	)


Financing Activities
Issuance of long-term debt		247			395
Redemption of long-term debt		(71	)		(628	)
Short-term borrowings, net		13			219
Capital contribution by parent company		150			—
Dividends on common stock		(152	)		(152	)
Other		(5	)		(3	)

Net cash from (used for) financing activities		182			(169	)


Net Increase in Cash and Cash Equivalents		1			11
Cash and Cash Equivalents at Beginning of the Period		26			6

Cash and Cash Equivalents at End of the Period	$	27		$	17

See Notes to Consolidated Financial Statements (Unaudited)

The Detroit Edison Company

Consolidated Statement of Changes in Shareholder’s Equity

and Comprehensive Income (unaudited)


													Accumulated
(Dollars in Millions,					Additional		Common						Other
Shares in Thousands)	Common Stock				Paid in		Stock			Retained			Comprehensive
	Shares		Amount		Capital		Expense			Earnings			Income		Total


Balance, December 31, 2005		138,632	$	1,386	$	1,104	$	(44	)	$	500		$	2	$	2,948

Net income		—		—		—		—			116			—		116
Capital contribution by parent company				—		150		—			—			—		150
Dividends declared on common stock		—		—		—		—			(152	)		—		(152	)

Balance, June 30, 2006		138,632	$	1,386	$	1,254	$	(44	)	$	464		$	2	$	3,062

The following table displays other comprehensive income for the six-month periods ended June 30:


	2006		2005
(in Millions)
Net income	$	116	$	98


Comprehensive income	$	116	$	98

See Notes to Consolidated Financial Statements (Unaudited)

The Detroit Edison Company

Notes to Consolidated Financial Statements (unaudited)

NOTE 1 — GENERAL

These consolidated financial statements should be read in conjunction with the notes to consolidated financial statements included in our 2005 Annual Report on Form 10-K.

The accompanying consolidated financial statements are prepared using accounting principles generally accepted in the United States of America. These accounting principles require us to use estimates and assumptions that impact the reported amounts of assets, liabilities, revenues and expenses, and the disclosure of contingent assets and liabilities. Actual results may differ from our estimates.

The consolidated financial statements are unaudited, but in our opinion include all adjustments necessary for a fair statement of the results for the interim periods. Financial results for this interim period are not necessarily indicative of results that may be expected for any other interim period or for the fiscal year.

We reclassified certain prior year balances to match the current year’s financial statement presentation.

Consolidated Statement of Cash Flows

A detailed analysis of the changes in assets and liabilities that are reported in the consolidated statement of cash flows follows:


	Six Months Ended
	June 30
	2006			2005
(in Millions)
Changes in Assets and Liabilities, Exclusive of Changes Shown Separately

Accounts receivable, net	$	(118	)	$	(47	)
Inventories		(25	)		(8	)
Accrued pensions		66			54
Accounts payable		39			18
Accrued power supply cost recovery refund		(63	)		(29	)
Income taxes payable		49			50
General taxes		2			3
Postretirement obligation		—			28
Other assets		(22	)		(29	)
Other liabilities		(39	)		19

	$	(111	)	$	59

Supplementary cash and non-cash information follows:


	Six Months Ended
	June 30
(in Millions)	2006		2005

Cash Paid for:
Interest (excluding interest capitalized)	$	147	$	131
Income taxes	$	1	$	—

Asset Retirement Obligations

We have recorded asset retirement obligations in accordance with SFAS No. 143, Accounting for Asset Retirement Obligations and FASB Interpretation FIN No. 47, Accounting for Conditional Asset Retirement Obligations, an interpretation of FASB Statement No. 143 . We identified a legal retirement obligation for the decommissioning costs for our Fermi 1 and Fermi 2 nuclear plants. We identified conditional retirement obligations for disposal of asbestos at certain of our power plants. To a lesser extent, we have conditional retirement obligations at certain service centers, and PCB disposal costs within transformers and circuit breakers.

As to regulated operations, we believe that adoptions of SFAS No. 143 and FIN 47 result primarily in timing differences in the recognition of legal asset retirement costs that we are currently recovering in rates. We will be deferring such differences under SFAS No. 71, Accounting for the Effects of Certain Types of Regulation.

A reconciliation of the asset retirement obligation for the 2006 six-month period follows:


(in Millions)
Asset retirement obligations at January 1, 2006	$	953
Accretion		32

Asset retirement obligations at June 30, 2006	$	985

A significant portion of the asset retirement obligations represents nuclear decommissioning liabilities which are funded through a surcharge to electric customers over the life of the Fermi 2 nuclear plant.

Retirement Benefits and Trusteed Assets

The components of net periodic benefit costs for qualified and non-qualified pension benefits and other postretirement benefits follow:


							Other Postretirement
(in Millions)	Pension Benefits						Benefits
Three Months Ended June 30	2006			2005			2006			2005

Service Cost	$	13		$	13		$	12		$	11
Interest Cost		34			33			22			20
Expected Return on Plan Assets		(34	)		(33	)		(13	)		(14	)
Amortization of
Net loss		11			12			13			11
Prior service cost		2			3			1			1
Net transition liability		—			—			2			1
Special Termination Benefits		14			—			1			—

Net Periodic Benefit Cost	$	40		$	28		$	38		$	30


							Other Postretirement
(in Millions)	Pension Benefits						Benefits
Six Months Ended June 30	2006			2005			2006			2005

Service Cost	$	26		$	27		$	24		$	22
Interest Cost		68			66			44			40
Expected Return on Plan Assets		(68	)		(67	)		(25	)		(29	)
Amortization of
Net loss		23			25			26			22
Prior service cost		4			5			2			2
Net transition liability		—			—			3			3
Special Termination Benefits		14			—			1			—

Net Periodic Benefit Cost	$	67		$	56		$	75		$	60

During the second quarter of 2006, we recorded a $14 million pension cost and a $1 million postretirement benefit cost associated with the initial stage of our Performance Excellence Process program. In 2006, we made cash contributions of $40 million to our postretirement benefit plans.

Affiliate Transactions

Detroit Edison shares costs with or incurs costs on behalf of unconsolidated affiliated companies. Prior to September 2005, we recorded such costs within “Other expenses” and related reimbursement within “Other income” in the Consolidated Statement of Operations. These transactions do not affect combined other income and deductions or net income. Our financial statements now reflect such affiliate transactions exclusively within affiliate accounts receivable. Consistent with the current period’s presentation, previously reported amounts within the Consolidated Statement of Operations have been adjusted accordingly.

NOTE 2 — NEW ACCOUNTING PRONOUNCEMENTS

Stock-Based Compensation

Effective January 1, 2006, our parent company, DTE Energy, adopted SFAS No. 123(R), Share-Based Payment, using the modified prospective transition method. We receive an allocation of costs associated with stock compensation and the related impact of cumulative accounting adjustments.

Our allocation for the first six months of 2006 for stock-based compensation expense was approximately $8 million. The cumulative effect of the adoption of SFAS 123(R) was a decrease in operation and maintenance expense of $1 million in the first quarter of 2006. The cumulative effect adjustment was due to the estimation and subsequent allocation of forfeitures for previously granted stock awards and performance shares. We have not restated any prior periods as a result of the adoption of SFAS 123(R).

Accounting for Uncertainty in Income Taxes

In July 2006, the FASB issued Financial Interpretation No. 48 (FIN 48), Accounting for Uncertainty in Income Taxes — An Interpretation of FASB Statement No. 109 — Accounting for Income Taxes. FIN 48 clarifies the accounting for uncertainty in income taxes recognized in an enterprise’s financial statements in accordance with FASB Statement No. 109. Additionally, it prescribes a recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken or

expected to be taken in the tax return. FIN 48 provides guidance on derecognition, classification, interest and penalties, accounting in interim periods, disclosure and transition and is effective for fiscal years beginning after December 15, 2006. We plan to adopt FIN 48 on January 1, 2007. We are currently assessing the effects of this interpretation, and have not yet determined the impact on the consolidated financial statements.

NOTE 3 — REGULATORY MATTERS

Electric Rate Restructuring Proposal

In February 2005, Detroit Edison filed a rate restructuring proposal with the MPSC to restructure its electric rates and begin phasing out subsidies within the current pricing structure. In December 2005, the MPSC issued an order that did not provide for the comprehensive realignment of the existing rate structure that Detroit Edison requested in its rate restructuring proposal. The MPSC order did take some initial steps to improve the current competitive imbalance in Michigan’s electric Customer Choice program. The December 2005 order established cost-based power supply rates for Detroit Edison’s full service customers. Electric Customer Choice participants will pay cost-based distribution rates, while Detroit Edison’s full service commercial and industrial customers will pay cost-based distribution rates that reflect the cost of the residential rate subsidy. Residential customers continue to pay a subsidized below-cost rate for distribution service. These revenue neutral revised rates were effective February 1, 2006. Detroit Edison was also ordered to file a general rate case by July 1, 2007, based on 2006 actual results.

2004 PSCR Reconciliation and 2004 Net Stranded Cost Case

In accordance with the MPSC’s direction in Detroit Edison’s November 2004 rate order, in March 2005, Detroit Edison filed a joint application and testimony in its 2004 PSCR Reconciliation Case and its 2004 Net Stranded Cost Recovery Case. The combined proceeding will provide a comprehensive true-up of the 2004 PSCR and production fixed cost stranded cost calculations, including treatment of Detroit Edison’s third party wholesale sales revenues. Under the prior authorized methodology from the last rate order, Detroit Edison incurred approximately $112 million in stranded costs for 2004. Detroit Edison also made approximately $218 million in third party wholesale sales.

In the filing, Detroit Edison proposed the following distribution of the $218 million of third party wholesale sale revenues: $91 million to offset associated PSCR fuel expense and $74 million to offset 2004 production operation and maintenance expense. The remaining $53 million would be allocated between bundled customers and electric Customer Choice customers. This allocation would result in a refund of approximately $8 million to bundled customers and a net stranded cost amount to be collected from electric Customer Choice customers of approximately $99 million.

Included with the application was the filing of a motion for a temporary interim order requesting the continuation of the existing electric Customer Choice transition charges until a final order is issued. The MPSC denied this motion in August 2005. In April 2006, an MPSC Administrative Law Judge (ALJ) issued a Proposal for Decision (PFD) indicating that Detroit Edison’s position in the combined cases is overstated. The potential outcome in the case is a reduction of net income in the range of $15 million to $50 million. A final order is expected in the latter half of 2006.

MPSC Show-Cause Order

In March 2006, the MPSC issued an order directing Detroit Edison to show cause by June 1, 2006 why its retail electric rates should not be reduced in 2007. The MPSC cited certain changes that have occurred since the November 2004 order in Detroit Edison’s last general rate case, or are expected to occur. These changes

include: declines in electric Customer Choice program participation, expiration of the residential rate caps, and projected reductions in Detroit Edison operating costs. The show cause filing is to reflect sales, costs and financial conditions that are expected to occur by 2007. On June 1, 2006, Detroit Edison filed its response explaining why its electric rates should not be reduced in 2007. Detroit Edison indicated that it will have a revenue deficiency of approximately $45 million beginning in 2007 due to significant capital investments over the next several years for infrastructure improvements to enhance electric service reliability and for mandated environmental expenditures. The impacts of these investments will be partially offset by efficiency and cost-savings measures that have been initiated. Therefore, Detroit Edison requested that the show cause proceeding allow for rate increase adjustments based on the combined effects of investment expenditures and cost-savings programs. The MPSC denied this request and indicated that a full review of rates will be made in Detroit Edison’s next general rate case, which is due to be filed by July 1, 2007. A final order in the show cause proceeding is expected by the end of 2006.

Power Supply Recovery Proceedings

2005 Plan Year — In September 2004, Detroit Edison filed its 2005 PSCR plan case seeking approval of a levelized PSCR factor of 1.82 mills per kWh above the amount included in base rates. In December 2004, Detroit Edison filed revisions to its 2005 PSCR plan case in accordance with the November 2004 MPSC rate order. The revised filing seeks approval of a levelized PSCR factor of up to 0.48 mills per kWh above the new base rates established in the final electric rate order. Included in the factor are power supply costs, transmission expenses and nitrogen oxide emission allowance costs. Detroit Edison self-implemented a factor of negative 2.00 mills per kWh on January 1, 2005. Effective June 1, 2005, Detroit Edison began billing the maximum allowable factor of 0.48 mills per kWh due to increased power supply costs. In September 2005, the MPSC approved Detroit Edison’s 2005 PSCR plan case. At December 31, 2005, Detroit Edison has recorded an under-recovery of approximately $144 million related to the 2005 plan year. In March 2006, Detroit Edison filed its 2005 PSCR reconciliation. The filing seeks approval for recovery of approximately $144 million from its commercial and industrial customers. The filing included a motion for entry of an order to implement immediately a reconciliation surcharge of 4.96 mills per kWh on the bills of its commercial and industrial customers. The under-collected PSCR expense allocated to residential customers could not be recovered due to the PA 141 rate cap for residential customers, which expired January 1, 2006. In addition to the 2005 PSCR Plan Year Reconciliation, the filing included a reconciliation for the Pension Equalization Mechanism (PEM) for the periods from November 24, 2004 through December 31, 2004 and from January 1, 2005 through December 31, 2005. The PEM reconciliation seeks to allocate and refund approximately $12 million to customers based upon their contributions to pension expense during the subject periods.

2006 Plan Year — In September 2005, Detroit Edison filed its 2006 PSCR plan case seeking approval of a levelized PSCR factor of 4.99 mills per kWh above the amount included in base rates for residential customers and 8.29 per kWh above the amount included in base rates for commercial and industrial customers. Included in the factor for all customers are power supply costs, transmission expenses, MISO market participation costs, and nitrogen oxide emission allowance costs. The Company’s PSCR Plan includes a matrix which provides for different maximum PSCR factors contingent on varying electric Customer Choice sales levels. The plan also includes $97 million for recovery of its projected 2005 PSCR under-collection associated with commercial and industrial customers. Additionally, the PSCR plan requests MPSC approval of expense associated with sulfur dioxide emission allowances, mercury emission allowances, and a fuel additive. In conjunction with DTE Energy’s sale of the transmission assets of ITC in February 2003, the FERC froze ITC’s transmission rates through December 2004. In approving the sale, FERC authorized ITC recovery of the difference between the revenue it would have collected and the actual revenue ITC did collect during the rate freeze period. At December 31, 2005, this amount is estimated to be $66 million which is to be included in ITC’s rates over a five-year period beginning June 1, 2006. It is expected that this amortization will increase Detroit Edison’s transmission expense in 2006 by $7 million. The MPSC authorized Detroit Edison in 2004 to recover transmission expenses through the PSCR mechanism.

In December 2005, the MPSC issued a temporary order authorizing the Company to begin implementation of maximum quarterly PSCR factors on January 1, 2006. The quarterly factors reflect a downward adjustment in the Company’s total power supply costs of approximately 2% to reflect the potential variability in cost projections. The quarterly factors will allow the Company to more closely track the costs of providing electric service to our customers and, because the non-summer factors are well below those ordered for the summer months, effectively delay the higher power supply costs to the summer months at which time our customers will not be experiencing large expenditures for home heating. The MPSC did not adopt the Company’s request to recover its projected 2005 PSCR under-collection associated with commercial and industrial customers nor did it adopt the Company’s request to implement contingency factors based upon the Company’s increased costs associated with providing electric service to returning electric Customer Choice customers. The MPSC deferred both of those Company proposals to the final order on the Company’s entire 2006 PSCR Plan.

Electric Shut-Off and Restoration

In June 2006, the MPSC approved a settlement agreement with Detroit Edison regarding issues related to service restoration. The MPSC had determined that restoration of certain electric service shut-offs effected between October 28, 2005 and March 14, 2006 did not conform to MPSC rules. The settlement agreement directs Detroit Edison to bring its service restoration process into compliance with MPSC rules and submit monthly reports identifying progress toward compliance. Detroit Edison also agreed to pay a fine of $105,000 and file a plan with the MPSC by September 1, 2006 detailing assistance customers can receive to avoid service shut-offs.

Regulatory Accounting Treatment for Performance Excellence Process

In May 2006, Detroit Edison filed an application with the MPSC to allow deferral of costs associated with the implementation of the Performance Excellence Process, a company-wide cost-savings and performance improvement program. Implementation costs include project management, consultant support and employee severance expenses. Detroit Edison seeks MPSC authorization to defer and amortize Performance Excellence Process implementation costs for accounting purposes to match the expected savings from the Performance Excellence Process program with the related costs to achieve. Detroit Edison anticipates that the Performance Excellence Process will be carried out over a two to three year period beginning in 2006. Detroit Edison’s implementation costs are estimated to total between $160 million and $190 million.

Revenue Sufficiency Guarantee

Since the April 2005 implementation of Midwest Independent Transmission System Operator Inc. (MISO) market operations, MISO’s business practice manuals and other instructions to market participants have stated that Revenue Sufficiency Guarantee (RSG) charges will not be imposed on day-ahead virtual offers to supply power not supported by actual generation. RSG charges are collected by MISO from Load Serving Entities in order to compensate generators that are standing by to supply electricity when called upon by MISO. In an April 2006 order, FERC interpreted MISO’s tariff to require that virtual supply offers should also be subject to RSG charges. Thus FERC found MISO’s RSG calculation methodology to be in violation of its tariff and ordered charges to those entities submitting virtual supply offers and ordered refunds to qualifying Load Serving Entities in an amount equal to those charges. The recalculation of RSG charges and refunds is to be retroactive to April 1, 2005. MISO may also retroactively impose RSG charges on market participants who submitted virtual supply offers during the recalculation period. Detroit Edison is among the MISO Load Serving Entities that paid RSG charges. Detroit Edison could receive a refund as a result of the order. Numerous requests for rehearing have been filed and the matter remains pending before FERC. The Company is unable to predict the outcome of this proceeding.

Other

We are unable to predict the outcome of the regulatory matters discussed herein. Resolution of these matters is dependent upon future MPSC orders and appeals, which may materially impact the financial position, results of operations and cash flows of the Company.

NOTE 4 — LONG-TERM DEBT

Debt Issuances

In 2006, we issued the following long-term debt:

(in Millions)

Month

Company

Issued

Type

Interest Rate

Maturity

Amount

Detroit Edison

May

Senior Notes (1)

6.625

June 2036

250


(1)		The proceeds from the issuance were used to repay short-term borrowings of Detroit Edison and for general corporate purposes

NOTE 5 — COMMITMENTS AND CONTINGENCIES

Environmental

Air - Detroit Edison is subject to EPA ozone transport and acid rain regulations that limit power plant emissions of sulfur dioxide and nitrogen oxides. In March 2005, EPA issued additional emission reduction regulations relating to ozone, fine particulate, regional haze and mercury air pollution. The new rules will lead to additional controls on fossil-fueled power plants to reduce nitrogen oxide, sulfur dioxide and mercury emissions. To comply with these requirements, Detroit Edison has spent approximately $644 million through 2005. We estimate Detroit Edison future capital expenditures at up to $218 million in 2006 and up to $2.2 billion of additional capital expenditures through 2018 to satisfy both the existing and proposed new control requirements. Under the June 2000 Michigan restructuring legislation, beginning January 1, 2004, annual return of and on this capital expenditure could be deferred in ratemaking, until December 31, 2005, the expiration of the rate cap period.

Water - Detroit Edison is required to examine alternatives for reducing the environmental impacts of the cooling water intake structures at several of its facilities. Based on the results of the studies to be conducted over the next several years, Detroit Edison may be required to install additional control technologies to reduce the impacts of the intakes. It is estimated that we will incur up to $50 million over the next four to six years in additional capital expenditures for Detroit Edison.

Contaminated Sites - Detroit Edison conducted remedial investigations at contaminated sites, including two former manufactured gas plant (MGP) sites, the area surrounding an ash landfill and several underground and aboveground storage tank locations. The findings of these investigations indicated that the estimated cost to remediate these sites is approximately $13 million which was accrued in 2005 and is expected to be incurred over the next several years.

Personal Property Taxes

Detroit Edison and other Michigan utilities have asserted that Michigan’s valuation tables result in the substantial overvaluation of utility personal property. Valuation tables established by the Michigan State

Tax Commission (STC) are used to determine the taxable value of personal property based on the property’s age. In November 1999, the STC approved new valuation tables that more accurately recognize the value of a utility’s personal property. The new tables became effective in 2000 and are currently used to calculate property tax expense. However, several local taxing jurisdictions have taken legal action attempting to prevent the STC from implementing the new valuation tables and have continued to prepare assessments based on the superseded tables. The legal actions regarding the appropriateness of the new tables were before the Michigan Tax Tribunal (MTT) which, in April 2002, issued a decision essentially affirming the validity of the STC’s new tables. In June 2002, petitioners in the case filed an appeal of the MTT’s decision with the Michigan Court of Appeals. In January 2004, the Michigan Court of Appeals upheld the validity of the new tables. With no further appeal by the petitioners available, the MTT began to schedule utility personal property valuation cases for Prehearing General Calls. After a period of abeyance, the MTT issued a scheduling order in a significant number of Detroit Edison appeals that set litigation calendars for these cases extending into mid-2006. After an extended period of settlement discussions, a Memorandum of Understanding has been reached with six principals in the litigation and the Michigan Department of Treasury that is expected to lead to settlement of all outstanding property tax disputes on a global basis.

On December 8, 2005, executed Stipulations for Consent Judgment, Consent Judgments, and Schedules to Consent Judgment were filed with the MTT on behalf of Detroit Edison and a significant number of the largest jurisdictions, in terms of tax dollars, involved in the litigation. The filing of these documents fulfilled the requirements of the global settlement agreement and resolves a number of claims by the litigants against each other including both property and non-property issues. The global settlement agreement resulted in a pre-tax economic benefit to Detroit Edison in 2005 that included the release of a litigation reserve.

Income Taxes

The Internal Revenue Service is currently conducting audits of our federal income tax returns for the years 2002 and 2003. We have accrued tax and interest related to tax uncertainties that arise due to actual or potential disagreements with governmental agencies about the tax treatment of specific items. At June 30, 2006, we have accrued approximately $5 million for such uncertainties. We believe that our accrued tax liabilities are adequate for all years.

Other Commitments

Detroit Edison has an Energy Purchase Agreement to purchase steam and electricity from the Greater Detroit Resource Recovery Authority (GDRRA). Under the Agreement, Detroit Edison will purchase steam through 2008 and electricity through June 2024. In 1996, a special charge to income was recorded that included a reserve for steam purchase commitments in excess of replacement costs from 1997 through 2008. The reserve for steam purchase commitments is being amortized to fuel, purchased power and gas expense with non-cash accretion expense being recorded through 2008. We purchased $42 million of steam and electricity in 2005 and 2004 and $39 million in 2003. We estimate steam and electric purchase commitments through 2024 will not exceed $427 million. In January 2003, we sold the steam heating business of Detroit Edison to Thermal Ventures II, LP. Due to terms of the sale, Detroit Edison remains contractually obligated to buy steam from GDRRA until 2008 and recorded an additional liability of $20 million for future commitments. Also, we have guaranteed bank loans that Thermal Ventures II, LP may use for capital improvements to the steam heating system.

As of December 31, 2005, we were party to numerous long-term purchase commitments relating to a variety of goods and services required for our business. These agreements primarily consist of fuel supply commitments. We estimate that these commitments will be approximately $1.3 billion through 2020. We also estimate that 2006 base level capital expenditures will be $800 million. We have made certain commitments in connection with expected capital expenditures.

Bankruptcies

We purchase and sell electricity from and to numerous companies operating in the steel, automotive, energy, retail and other industries. Certain of our customers have filed for bankruptcy protection under Chapter 11 of the U.S. Bankruptcy Code. We regularly review contingent matters relating to these customers and our purchase and sale contracts and we record provisions for amounts considered at risk of probable loss. We believe our previously accrued amounts are adequate for probable losses. The final resolution of these matters is not expected to have a material effect on our financial statements.

Other

We are involved in certain legal, regulatory, administrative and environmental proceedings before various courts, arbitration panels and governmental agencies concerning claims arising in the ordinary course of business. These proceedings include certain contract disputes, environmental reviews and investigations, audits, inquiries from various regulators, and pending judicial matters. We cannot predict the final disposition of such proceedings. We regularly review legal matters and record provisions for claims that are considered probable of loss. The resolution of pending proceedings is not expected to have a material effect on our operations or financial statements in the period they are resolved.

See Note 3 for a discussion of contingencies related to regulatory matters.

Other Information

Legal Proceedings

We are involved in certain legal, regulatory, administrative and environmental proceedings before various courts, arbitration panels and governmental agencies concerning matters arising in the ordinary course of business. These proceedings include certain contract disputes, environmental reviews and investigations, audits, inquiries from various regulators, and pending judicial matters. We cannot predict the final disposition of such proceedings. We regularly review legal matters and record provisions for claims that are considered probable of loss. The resolution of pending proceedings is not expected to have a material effect on our operations or financial statements in the period they are resolved. For additional discussion on legal matters, see the Notes to the Consolidated Financial Statements.

See Note 3 for a discussion of contingencies related to Regulatory Matters and Note 5 for a discussion of specific non-regulatory matters.

Exhibits


Exhibit
Number		Description

Filed:
4-249		Twentieth Supplemental Indenture, dated as of May 15, 2006 to the Collateral Trust Indenture, dated as of June 30, 1993 between The Detroit Edison Company and J.P. Morgan Trust Company, National Association, as successor trustee, providing for 2006 Series A Senior Notes due 2036.

4-250		Supplemental Indenture, dated as of May 15, 2006 to Mortgage and Deed of Trust dated as of October 1, 1924 between The Detroit Edison Company and J.P. Morgan Trust Company, National Association, as successor trustee, providing for General and Refunding Mortgage Bonds, 2006 Series A.

12-25		Computation of Ratios of Earnings to Fixed Charges

31-25		Chief Executive Officer Section 302 Form 10-Q Certification

31-26		Chief Financial Officer Section 302 Form 10-Q Certification

Incorporated by reference:
1-1		Underwriting Agreement dated May 17, 2006 among The Detroit Edison Company, Barclays Capital Inc., Citigroup Global Markets Inc. and J.P. Morgan Securities Inc. (Exhibit 1.1 to Form 8-K dated May 17, 2006).

Furnished:

32-25		Chief Executive Officer Section 906 Form 10-Q Certification
32-26		Chief Financial Officer Section 906 Form 10-Q Certification

Signature

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.


	THE DETROIT EDISON COMPANY
Date: August 8, 2006	/s/ PETER B. OLEKSIAK
	Peter B. Oleksiak
	Controller

Exhibit Index


Exhibit
Number		Description

4-249		Twentieth Supplemental Indenture, dated as of May 15, 2006 to the Collateral Trust Indenture, dated as of June 30, 1993 between The Detroit Edison Company and J.P. Morgan Trust Company, National Association, as successor trustee, providing for 2006 Series A Senior Notes due 2036.

4-250		Supplemental Indenture, dated as of May 15, 2006 to Mortgage and Deed of Trust dated as of October 1, 1924 between The Detroit Edison Company and J.P. Morgan Trust Company, National Association, as successor trustee, providing for General and Refunding Mortgage Bonds, 2006 Series A.

12-25		Computation of Ratios of Earnings to Fixed Charges

31-25		Chief Executive Officer Section 302 Form 10-Q Certification

31-26		Chief Financial Officer Section 302 Form 10-Q Certification

32-25		Chief Executive Officer Section 906 Form 10-Q Certification
32-26		Chief Financial Officer Section 906 Form 10-Q Certification

Exhibit 4-249

THE DETROIT EDISON COMPANY
AND
J.P. MORGAN TRUST COMPANY, NATIONAL ASSOCIATION,
TRUSTEE

TWENTIETH SUPPLEMENTAL INDENTURE

DATED AS OF MAY 15, 2006

SUPPLEMENTING THE COLLATERAL TRUST INDENTURE
DATED AS OF JUNE 30, 1993
PROVIDING FOR

2006 SERIES A 6.625% SENIOR NOTES DUE 2036

SUPPLEMENTAL INDENTURE, dated as of the 15th day of May 2006, between THE DETROIT EDISON COMPANY, a corporation organized and existing under the laws of the State of Michigan (the "Company"), and J.P. MORGAN TRUST COMPANY, NATIONAL ASSOCIATION, a national banking association organized under the laws of the United States of America, having a corporate trust office in the City of Detroit, Michigan, as successor trustee (the "Trustee");

WHEREAS, the Company has heretofore executed and delivered to the Trustee a Collateral Trust Indenture dated as of June 30, 1993 (the "Original Indenture"), as supplemented, providing for the issuance by the Company from time to time of its debt securities; and

WHEREAS, the Company now desires to provide for the issuance of an additional series of its senior debt securities pursuant to the Original Indenture; and

WHEREAS, the Company intends hereby to designate a series of debt securities which shall have the benefit of the provisions of Article Four of the Original Indenture and the other related provisions of the Original Indenture relating to the grant of security, subject to the release provisions provided for herein, and which shall have the terms and variations from the provisions of the Original Indenture as set forth herein; and

WHEREAS, the Company, in the exercise of the power and authority conferred upon and reserved to it under the provisions of the Original Indenture, including Section 1001 thereof, and pursuant to appropriate resolutions of the Board of Directors, has duly determined to make, execute and deliver to the Trustee this Twentieth Supplemental Indenture to the Original Indenture as permitted by Sections 201 and 301 of the Original Indenture in order to establish the form or terms of, and to provide for the creation and issue of, a series of its debt securities under the Original Indenture, which shall be known as the 2006 Series A 6.625% Senior Notes due 2036.

WHEREAS, all things necessary to make such debt securities, when executed by the Company and authenticated and delivered by the Trustee or any Authenticating Agent and issued upon the terms and subject to the conditions hereinafter and in the Original Indenture set forth against payment therefor, the valid, binding and legal obligations of the Company and to make this Twentieth Supplemental Indenture a valid, binding and legal agreement of the Company, have been done;

NOW, THEREFORE, THIS TWENTIETH SUPPLEMENTAL INDENTURE WITNESSETH that, in order to establish the terms of a series of debt securities, and for and in consideration of the premises and of the covenants contained in the Original Indenture and in this Twentieth Supplemental Indenture and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, it is mutually covenanted and agreed as follows:

ARTICLE ONE

DEFINITIONS AND OTHER
PROVISIONS OF GENERAL APPLICATION

SECTION 1.01. Definitions. Each capitalized term that is used herein and is defined in the Original Indenture shall have the meaning specified in the Original Indenture unless such term is otherwise defined herein. The following terms shall have the respective meanings set forth below:

"Business Day" means any day other than a day on which banking institutions in the State of New York or the State of Michigan are authorized or obligated pursuant to law or executive order to close.

"Capitalization" means the total of all the following items appearing on, or included in, the consolidated balance sheet of the Company: (i) liabilities for indebtedness maturing more than 12 months from the date of determination; and (ii) common stock, common stock expense, accumulated other comprehensive income or loss, preferred stock, preference stock, premium on capital stock and retained earnings (however the foregoing may be designated), less, to the extent not otherwise deducted, the cost of shares of capital stock of the Company held in its treasury, if any. Subject to the foregoing, Capitalization shall be determined in accordance with generally accepted accounting principles and practices applicable to the type of business in which the Company is engaged and may be determined as of a date not more than 60 days prior to the happening of the event for which the determination is being made. In connection with such determination, the Company shall certify to the Trustee that it has, prior to making its final determination, consulted with the independent accountants regularly retained by the Company.

"Debt" means any outstanding debt for money borrowed evidenced by notes, debentures, bonds or other securities, or guarantees of any debt.

"Net Tangible Assets" means the amount shown as total assets on the consolidated balance sheet of the Company, less (i) intangible assets including, but without limitation, such items as goodwill, trademarks, trade names, patents, unamortized debt discount and expense and other regulatory assets carried as an asset on the Company's consolidated balance sheet, and (ii) appropriate adjustments, if any, on account of minority interests. Net Tangible Assets shall be determined in accordance with generally accepted accounting principles and practices applicable to the type of business in which the Company is engaged and may be determined as of a date not more than 60 days prior to the happening of the event for which such determination is being made. In connection with such determination, the Company shall certify to the Trustee that it has, prior to making its final determination, consulted with the independent accountants regularly retained by the Company.

"Operating Property" means (i) any interest in real property owned by the Company and (ii) any asset owned by the Company that is depreciable in accordance with generally accepted accounting principles, excluding, in either case, any interest of the Company as lessee under any lease (except for a lease that results from a Sale and Lease-Back Transaction) that has been or would be capitalized on the books of the lessee in accordance with generally accepted accounting principles.

"Original Issue Date" means May 24, 2006.

"Pledged Bonds" means the related series of Bonds and any other Mortgage Bonds issued to secure Securities subject to the release provisions provided herein or in any other supplemental indenture to the Original Indenture.

"Release Date" means the date as of which all Mortgage Bonds, (i) other than the Pledged Bonds, including the related series of Bonds, and (ii) other than outstanding Mortgage Bonds (exclusive of Pledged Bonds) which do not in aggregate principal amount exceed the greater of 5% of the Net Tangible Assets of the Company or 5% of the Capitalization of the Company, have been retired through payment, redemption or otherwise, provided that no default or Event of Default has occurred and, at such time, is continuing under the Original Indenture.

"Sale and Lease-Back Transaction" means any arrangement with any person providing for the leasing to the Company of any Operating Property (except for leases for a term, including any renewal or potential renewal, of not more than 48 months), which Operating Property has been or is to be sold or transferred by the Company to the person; provided, however, Sale and Lease-Back Transaction shall not include any arrangement first entered into prior to the date hereof and shall not include any transaction pursuant to which the Company sells Operating Property to, and thereafter purchases energy or services from, any entity, which transaction is ordered or authorized by any regulatory authority having jurisdiction over the Company or its operations or is entered into pursuant to any plan or program of industry restructuring ordered or authorized by any such regulatory authority.

"Substitute Mortgage" means a mortgage indenture of the Company, other than the Mortgage, designated by the Company to the Trustee as a Substitute Mortgage pursuant to Section 4.03 hereof. The lien of the Substitute Mortgage shall have such priority, and be with respect to such property, as shall be specified by the Company in its sole discretion.

"Substitute Mortgage Bonds" means any mortgage bonds issued by the Company under a Substitute Mortgage and delivered to the Trustee pursuant to Section 4.03 hereof or pursuant to the comparable provision of any other supplemental indenture relating to Securities subject to the release provisions.

"Value" means, with respect to a Sale and Lease-Back Transaction, as of any particular time, the amount equal to the greater of (i) the net proceeds to the Company from the sale or transfer of the property leased pursuant to the Sale and Lease-Back Transaction or (ii) the net book value of the property, as determined by the Company in accordance with generally accepted accounting principles at the time of entering into the Sale and Lease-Back Transaction, in either case multiplied by a fraction, the numerator of which shall be equal to the number of full years of the term of the lease that is part of the Sale and Lease-Back Transaction remaining at the time of determination and the denominator of which shall be equal to the number of full years of the term, without regard, in any case, to any renewal or extension options contained in the lease.

SECTION 1.02. Section References. Each reference to a particular section set forth in this Twentieth Supplemental Indenture shall, unless the context otherwise requires, refer to this Twentieth Supplemental Indenture.

ARTICLE TWO

TITLE AND TERMS OF THE SECURITIES

SECTION 2.01. Title of the Securities; Stated Maturity. This Twentieth Supplemental Indenture hereby establishes a series of Securities, which shall be known as the Company's "2006 Series A 6.625% Senior Notes due 2036" (the "Notes"). For purposes of the Original Indenture, the Notes shall constitute a single series of Securities. The Stated Maturity on which the principal of the Notes shall be due and payable will be June 1, 2036.

SECTION 2.02. Certain Variations from the Original Indenture.

(a) The Notes shall have the benefit of the provisions of Article Four of the Original Indenture and shall have the benefit of, or be subject to, the other related provisions of the Original Indenture relating to the grant of security, including (for avoidance of doubt and not for purposes of limitation) the Granting Clause, the definitions of "Deliverable Mortgage Bonds," "Deliverable Securities," "Designated Mortgage Bonds," "Grant," "Mortgage," "Mortgage Bonds," "Mortgage Trustee," "Previously Delivered Mortgage Bonds," and "Trust Estate," Section 301(20), Sections 301(a)(v), (ix), (x) and (xi), Sections 301(b)(ii) and (iii), Section 301(d), and Sections 601(4) and (8), subject, in each case, to the release provisions provided for in Section 4.02 herein. In addition, on and after the Release Date, unless Substitute Mortgage Bonds are issued to secure the Notes, the Notes shall have the benefit of the additional covenants set forth in Article Three hereof.

(b) Section 503 of the Original Indenture shall apply to the Notes. The following shall be an additional condition to defeasance of the Notes under
Section 503: the Company shall have delivered to the Trustee an Opinion of Counsel stating that (i) the Company has received from the Internal Revenue Service a letter ruling, or there has been published by the Internal Revenue Service a Revenue Ruling, or (ii) since the date of execution of this Twentieth Supplemental Indenture, there has been a change in the applicable U.S. Federal income tax law, in either case to the effect that, the Holders of such Outstanding Notes appertaining thereto will not recognize income, gain or loss for U.S. Federal income tax purposes as a result of such defeasance and will be subject to U.S. Federal income tax on the same amounts, in the same manner and at the same times as would have been the case if such defeasance had not occurred, and, also, to the effect that, after the 123rd day after the date of deposit, all money and other property as provided pursuant to Section 503 of the Original Indenture (including the proceeds thereof) deposited or caused to be deposited with the Trustee (or other qualifying trustee) pursuant to Section 503 of the Original Indenture to be held in trust will not be subject to any case or proceeding (whether voluntary or involuntary) in respect of the Company under any Federal or State bankruptcy, insolvency, reorganization or other similar law, or any decree or order for relief in respect of the Company issued in connection therewith.

SECTION 2.03. Amount and Denominations; DTC

(a) The aggregate principal amount of Notes that may be issued under this Twentieth Supplemental Indenture is limited to $250,000,000 (except as provided in Section 301(2) of the Original Indenture); provided that the Company may, without the consent of the Holders of the

Outstanding Notes, "reopen" the series of the Notes so as to increase the aggregate principal amount of the Notes Outstanding in compliance with the procedures set forth in the Original Indenture, including Section 301 and
Section 303 thereof, so long as any such additional Notes have the same terms, conditions and CUSIP number (including, without limitation, rights to security and to receive accrued and unpaid interest) as the Notes then Outstanding. No additional Notes may be issued if an Event of Default has occurred with respect to the Notes. The Notes shall be issuable only in fully registered form and, as permitted by Section 301 and Section 302 of the Original Indenture, in denominations of $1,000 and integral multiples thereof. The Notes will initially be issued in global form (the "Global Securities") under a book-entry system, registered in the name of The Depository Trust Company, as depository ("DTC"), or its nominee, which is hereby designated as "Depository" under the Indenture.

(b) If (i) the Depository notifies the Company that it is unwilling or unable to continue as Depository for such Global Security or if at any time such Depository ceases to be a clearing agency registered under the Securities Exchange Act of 1934, and, in either such case, the Company does not appoint a successor Depository within 90 days thereafter, or (ii) there shall have occurred and be continuing an Event of Default or an event which, with the giving of notice or lapse of time, or both, would constitute an Event of Default, certificates for the Notes will be registered and delivered to the Holders of record. Upon receipt of a withdrawal request from the Company, the Depository will notify its participants of the receipt of a withdrawal request from the Company, notifying participants that they may utilize the Depository's withdrawal procedures if they wish to withdraw their securities from the Depository. To the extent that the book-entry system is discontinued, or if the Company fails to appoint a successor Depository, certificates for the Notes will be registered and delivered to the Holders of record.

SECTION 2.04. Certain Terms of the Notes.

(a) The Notes shall bear interest at the rate of 6.625% per annum on the principal amount thereof from the date of original issuance, or from the most recent Interest Payment Date to which interest has been paid or duly provided for, until the principal of the Notes becomes due and payable, and on any overdue principal and premium and (to the extent that payment of such interest is enforceable under applicable law) on any overdue installment of interest at the same rate per annum during such overdue period. Interest on the Notes will be payable semi-annually in arrears on June 1 and December 1 of each year (each such date, an "Interest Payment Date"), commencing December 1, 2006. The amount of interest payable for any period shall be computed on the basis of a 360-day year and twelve 30-day months.

(b) In the event that any Interest Payment Date, redemption date or other date of Maturity of the Notes is not a Business Day, then payment of the amount payable on such date will be made on the next succeeding day which is a Business Day (and without any interest or other payment in respect of any such delay), in each case with the same force and effect as if made on such date. The interest installment so payable, and punctually paid or duly provided for, on any Interest Payment Date with respect to any Note will, as provided in the Original Indenture, be paid to the person in whose name the Note (or one or more Predecessor Securities, as defined in the Original Indenture) is registered at the close of business on the relevant record date for such interest installment, which shall be the fifteenth calendar day (whether or not a Business Day) prior to the relevant Interest Payment Date (the "Regular Record Date"). Any such interest installment not

punctually paid or duly provided for shall forthwith cease to be payable to the registered Holders on such Regular Record Date, and may either be paid to the person in whose name the Note (or one or more Predecessor Securities) is registered at the close of business on a Special Record Date to be fixed by the Trustee for the payment of such defaulted interest, notice whereof shall be given to the registered Holders of the Notes not less than ten days prior to such Special Record Date, or may be paid at any time in any other lawful manner not inconsistent with the requirements of any securities exchange on which the Notes may be listed, and upon such notice as may be required by such exchange, all as more fully provided in the Original Indenture. The principal of, and premium, if any, and the interest on the Notes shall be payable at the office or agency of the Company maintained for that purpose in the Borough of Manhattan, the City of New York, in any coin or currency of the United States of America that at the time of payment is legal tender for payment of public and private debts; provided, however, that payment of interest may be made at the option of the Company by check mailed to the registered Holder at the close of business on the Regular Record Date at such address as shall appear in the Security Register. Notwithstanding the foregoing, so long as the Notes are Global Securities and are held in book-entry form through the facilities of the Depository, payments on the Notes will be made to the Depository or its nominee in accordance with arrangements then in effect between the Trustee and the Depository.

(c) The Notes are not subject to repayment at the option of the Holders thereof and are not subject to any sinking fund. As provided in the form of Notes attached hereto as Exhibit A, the Notes are subject to optional redemption, as a whole or in part, by the Company prior to Stated Maturity of the principal thereof on the terms set forth therein. Except as modified in the form of Notes, redemptions shall be effected in accordance with Article Twelve of the Original Indenture.

(d) The Notes shall have such other terms and provisions as are set forth in the form of Notes attached hereto as Exhibit A (which is incorporated by reference in and made a part of this Twentieth Supplemental Indenture as if set forth in full at this place).

SECTION 2.06. Form of Notes. Attached hereto as Exhibit A is the form of the Notes. If the Company elects to have the Notes secured by Substitute Mortgage Bonds on and after the Release Date, the terms of the Notes shall be amended to make appropriate reference to the Substitute Mortgage and the Substitute Mortgage Bonds; provided, that the consent of Holders shall not be required in connection with such amendment.

ARTICLE THREE

ADDITIONAL COVENANTS

SECTION 3.01. Limitations on Liens.

(a) From and after the Release Date, unless Substitute Mortgage Bonds are issued to secure the Notes, so long as any Notes are outstanding, the Company may not issue, assume, guarantee (including any contingent obligation to purchase) or permit to exist any Debt that is secured by any mortgage, security interest, pledge or lien ("Lien") of or upon any Operating Property owned by the Company, whether owned at the Release Date or subsequently acquired, without effectively securing the Notes (together with, if the Company shall so determine, any other

indebtedness of the Company ranking equally with the Notes) equally and ratably with the Debt (but only so long as the Debt is so secured).

The foregoing restriction will not apply to:

(i) Liens on any Operating Property existing at the time of its acquisition and not created in contemplation of the acquisition;

(ii) Liens on Operating Property of a corporation existing at the time the corporation is merged into or consolidated with the Company, or at the time the corporation disposes of substantially all of its properties (or those of a division) to the Company, provided that the Lien is not extended to property owned by the Company immediately prior to the merger, consolidation or other disposition and is not created in contemplation of the merger, consolidation or other disposition;

(iii) Liens on Operating Property to secure the cost of acquisition, construction, development or substantial repair, alteration or improvement of such property or to secure indebtedness incurred to provide funds for any of these purposes or for reimbursement of funds previously expended for any of these purposes, provided the Liens are created or assumed contemporaneously with, or within 18 months after, the acquisition or the completion of substantial repair or alteration, construction, development or substantial improvement or within 6 months thereafter pursuant to a commitment for financing arranged with a lender or investor within such 18-month period;

(iv) Liens in favor of the United States or any state or any department, agency or instrumentality or political subdivision of the United States or any state, or for the benefit of holders of securities issued by any of these entities, to secure any Debt incurred for the purpose of financing all or any part of the purchase price or the cost of substantially repairing or altering, constructing, developing or substantially improving the Operating Property; or

(v) Any extension, renewal or replacement (or successive extensions, renewals or replacements), in whole or in part, of any Lien referred to in the exceptions listed above, provided, however, that the principal amount of Debt secured thereby and not otherwise authorized by those exceptions listed above shall not exceed the principal amount of Debt, plus any premium or fee payable in connection with any such extension, renewal or replacement, so secured at the time of such extension, renewal or replacement.

(b) Notwithstanding the foregoing restrictions, the Company may issue, assume or guarantee Debt secured by a Lien which would otherwise be subject to the foregoing restrictions up to an aggregate amount which, together with all other of the Company's secured Debt (not including secured Debt permitted under any of the foregoing exceptions) and the Value of Sale and Lease-Back Transactions existing at such time (other than Sale and Lease-Back Transactions the proceeds of which have been applied to the retirement of certain indebtedness, Sale and Lease-Back Transactions in which the property involved would have been permitted to be subjected to a Lien under any of the foregoing exceptions, and Sale and Lease-Back Transactions that are permitted by the first sentence of Section 3.02 below), does not exceed the greater of 10% of the Company's Net Tangible Assets or 10% of the Company's Capitalization. The foregoing

restrictions do not limit the Company's ability to place Liens on (i) the capital stock of any of the Company's subsidiaries or (ii) the assets of any of the Company's subsidiaries.

SECTION 3.02. Limitations on Sale and Lease-Back Transactions. So long as the Notes are outstanding from and after the Release Date, unless Substitute Mortgage Bonds are issued to secure the Notes, the Company may not enter into or permit to exist any Sale and Lease-Back Transaction with respect to any Operating Property (except for leases for a term, including any renewal or potential renewal, of not more than 48 months), if the purchaser's commitment is obtained more than 18 months after the later of the completion of the acquisition, construction or development of the Operating Property or the placing in operation of the Operating Property or of the Operating Property as constructed or developed or substantially repaired, altered or improved. This restriction will not apply if (a) the Company would be entitled pursuant to
Section 3.01(a) above to issue, assume, guarantee or permit to exist Debt secured by a Lien on the Operating Property without equally and ratably securing the Notes, (b) after giving effect to the Sale and Lease-Back Transaction, pursuant to Section 3.01(b) above, the Company could incur at least $1.00 of additional Debt secured by Liens (other than Liens permitted by clause (a)), or
(c) the Company applies within 180 days an amount equal to, in the case of a sale or transfer for cash, the net proceeds (not less than the fair value of the Operating Property so leased), and, otherwise, an amount equal to the fair value (as determined by the Board of Directors of the Company) of the Operating Property so leased to the retirement of Notes or other Debt of the Company ranking equally with the Notes; provided, however, that any such retirement of Notes shall be in accordance with the terms and provisions of the Indenture and the Notes; provided, further, that the amount to be applied to such retirement of Notes or other Debt shall be reduced by an amount equal to the sum of (a) an amount equal to the redemption price with respect to Notes delivered within such one hundred eighty (180)-day period to the Trustee for retirement and cancellation and (b) the principal amount, plus any premium or fee paid in connection with any redemption in accordance with the terms of other Debt voluntarily retired by the Company within such one hundred eighty (180)-day period, excluding in each case retirements pursuant to mandatory sinking fund or prepayment provisions and payments at Stated Maturity.

SECTION 3.03. Waiver. Section 1109 of the Original Indenture shall apply to the covenants set forth in Sections 3.01 and 3.02 above at any time such covenants are in effect.

ARTICLE FOUR

SECURITY AND RELEASE PROVISIONS

SECTION 4.01. Security. Subject to Section 4.02 below, as provided in and pursuant to Article Four of the Original Indenture, the Notes will be secured as to payments of principal, interest and premium, if any, by a series of Mortgage Bonds (the "General and Refunding Mortgage Bonds, 2006 Series A", the "Bonds," the "Bonds of the related series" or the "related series of Bonds") of the Company to be issued concurrently with the issuance of the Notes under and secured by a Mortgage and Deed of Trust, dated as of October 1, 1924, between the Company and J.P. Morgan Trust Company, National Association, as successor trustee (the "Mortgage Trustee"), as amended and supplemented by various supplemental indentures, including the supplemental indenture, dated as of May 15, 2006, creating the Bonds (collectively, the "Mortgage"), pledged by the Company for the benefit of the Holders of the Notes to the

Trustee under this Twentieth Supplemental Indenture. The Bonds shall be issued in an aggregate principal amount equal to the aggregate principal amount of the Notes.

SECTION 4.02. Release. Until the Release Date and subject to Article Four of the Original Indenture, the Bonds of the related series issued and delivered to the Trustee shall serve as security for any and all obligations of the Company under all Notes from time to time Outstanding, including, but not limited to (1) the full and prompt payment of the principal and premium, if any, on the Notes when and as the same shall become due and payable in accordance with the terms and provisions of the Indenture or the Notes, either at the Stated Maturity thereof, upon acceleration of the maturity thereof, upon redemption, or otherwise, and (2) the full and prompt payment of any interest on the Notes when and as the same shall become due and payable in accordance with the terms and provisions of this Indenture or the Notes including, if and to the extent provided for in the Notes, interest on overdue installments of principal and (to the extent permitted by law) interest on overdue installments of interest.

Each supplemental indenture to the Mortgage pursuant to which any Bonds are issued shall contain a provision to the effect that any payment by the Company hereunder of principal of or premium or interest on Notes which shall have been authenticated and delivered in connection with the issuance and delivery to the Trustee of such Bonds (other than by the application of the proceeds of a payment in respect of such Bonds) shall to the extent thereof, be deemed to satisfy and discharge the obligation of the Company, if any, to make a payment of principal, premium or interest, as the case may be, in respect of such Bonds which is then due.

Notwithstanding anything in the Original Indenture to the contrary, from and after the Release Date, the obligation of the Company to make payment with respect to the principal of and premium, if any, and interest on the Bonds shall be deemed satisfied and discharged as provided in the supplemental indenture or indentures to the Mortgage creating such Bonds and the Bonds shall cease to secure in any manner Notes theretofore or subsequently issued; the Trustee shall thereupon surrender the Bonds to the Mortgage Trustee for cancellation and execute and deliver such proper instruments of release as may be required. From and after the Release Date, all Notes, whether theretofore or subsequently issued, shall, at the Company's option, either (i) become unsecured or (ii) be secured by Substitute Mortgage Bonds pursuant to Section 4.03 below, and any conditions to the issuance of Notes that refer or relate to Bonds or the Mortgage shall be inapplicable (except as such conditions shall be deemed to refer to Substitute Mortgage Bonds or a Substitute Mortgage pursuant to Section 4.03 below). From and after the Release Date, the Company shall not issue any additional Mortgage Bonds, including Pledged Bonds, under the Mortgage. Notice of the occurrence of the Release Date shall be given by the Trustee to the Holders of the Notes in the manner provided for in the Original Indenture not later than 30 days after the Company notifies the Trustee of the occurrence of the Release Date.

In connection with the establishment of the occurrence of the Release Date, the Trustee shall be entitled to receive, may presume the correctness of, and shall be fully protected in relying upon, an Officers' Certificate designating the Release Date and stating that the conditions to the occurrence of the Release Date have been satisfied.

When the obligation of the Company to make payments with respect to the principal of, and premium, if any, and interest on all or any part of the Bonds shall be satisfied or deemed satisfied pursuant to the Original Indenture or pursuant to this Twentieth Supplemental Indenture, the

Trustee shall, upon written request of the Company, deliver to the Company without charge therefor all of the Bonds so satisfied or deemed satisfied, together with such appropriate instruments of transfer or release as may be reasonably requested by the Company. All Bonds delivered to the Company in accordance with this Section shall be delivered by the Company to the Mortgage Trustee for cancellation.

SECTION 4.03. Substitute Mortgage Bonds.

(a) The Company shall notify the Trustee not less than 90 days prior to the Release Date (or such shorter period as the Company and the Trustee may agree) if the Company has determined to deliver to the Trustee on the Release Date Substitute Mortgage Bonds in an aggregate principal amount equal to the aggregate principal amount of Notes and any other Securities subject to the release provisions Outstanding on the Release Date, in trust for the benefit of the Holders from time to time of the Notes and any other Securities subject to the release provisions issued under the Original Indenture, as supplemented, as security for any and all obligations of the Company under the Notes and any other Securities subject to the release provisions, including but not limited to, (1) the full and prompt payment of the principal of and premium, if any, on the Notes and any other Securities subject to the release provisions when and as the same shall become due and payable in accordance with the terms and provisions of the Original Indenture, as supplemented, or the Notes or such other Securities subject to the release provisions, either at the stated maturity thereof, upon acceleration of the maturity thereof or upon redemption, and (2) the full and prompt payment of any interest on the Notes and any other Securities subject to the release provisions when and as the same shall become due and payable in accordance with the terms and provisions of the Original Indenture, as supplemented, or the Notes or such other Securities subject to the release provisions.

(b) The Substitute Mortgage Bonds to be delivered pursuant to the notice described in Section 4.03(a) shall be delivered in separate series and issues corresponding to the series and issues of Notes and other Securities subject to the release provisions Outstanding on the Release Date, each series or issue of Substitute Mortgage Bonds having the same stated rate or rates of interest (or interest calculated in the same manner), Interest Payment Dates, stated maturity date and redemption provisions, and in the same aggregate principal amount, as the related series or issue of Notes or other Securities subject to the release provisions outstanding on the Release Date. The Company shall enter into a Substitute Mortgage for the issuance of Substitute Mortgage Bonds, and designate it as such in the notice.

(c) The notice described in Section 4.03(a) shall also state that on the Release Date the Company shall deliver to the Trustee a supplemental indenture to the Original Indenture that will provide, among other things, that upon the issuance of Notes and other Securities subject to the release provisions on or after the Release Date, the Company shall deliver to the Trustee in trust for the benefit of the Holders as described in Section 4.03(a) hereof, and the Trustee shall accept therefor, related series of Substitute Mortgage Bonds registered in the name of the Trustee and conforming to the requirements therein specified.

(d) The determination whether to deliver Substitute Mortgage Bonds shall be made in the Company's sole discretion and without any obligation to do so.

(e) In the event that the Company does not deliver the notice described in
Section 4.03(a), the Notes and other Securities subject to the release provisions Outstanding on the Release Date shall, as of the Release Date, no longer be entitled to the benefit of the pledge of the Pledged Bonds and shall thereafter be general unsecured obligations of the Company.

(f) Article Four and related provisions of the Original Indenture shall apply to Substitute Mortgage Bonds pledged to the Trustee hereunder and the provisions thereof shall be deemed to refer to the Substitute Mortgage and the Substitute Mortgage Bonds. If the Company elects to have the Notes secured by Substitute Mortgage Bonds on and after the Release Date, Article Four and related provisions may be amended to make appropriate reference to the Substitute Mortgage and the Substitute Mortgage Bonds; provided, that the consent of Holders shall not be required in connection with such amendment.

SECTION 4.04. Events of Default.

(a) On and after the Release Date, Section 601(8) of the Original Indenture shall no longer apply to the Notes.

For purposes of the Notes, Section 601(8) of the Original Indenture shall read, "the occurrence of an "event of default" as such term is defined in the Mortgage; or".

(b) On and after the Release Date, if the Notes become secured by Substitute Mortgage Bonds pursuant to Section 4.03 above, the occurrence of a "default" (as defined in the Substitute Mortgage) shall constitute an Event of Default under Section 601 of the Original Indenture with respect to the Notes and the references in Section 601(4) of the Original Indenture and related provisions to "Mortgage Bonds" shall be deemed to refer to "Substitute Mortgage Bonds."

ARTICLE FIVE

MISCELLANEOUS PROVISIONS

The Trustee makes no undertaking or representations in respect of, and shall not be responsible in any manner whatsoever for and in respect of, the validity or sufficiency of this Twentieth Supplemental Indenture or the proper authorization or the due execution hereof by the Company or for or in respect of the recitals and statements contained herein, all of which recitals and statements are made solely by the Company.

Except as expressly amended hereby and by the supplemental indenture appointing the Trustee as successor trustee, the Original Indenture shall continue in full force and effect in accordance with the provisions thereof and the Original Indenture is in all respects hereby ratified and confirmed. This Twentieth Supplemental Indenture and all its provisions shall be deemed a part of the Original Indenture in the manner and to the extent herein and therein provided.

This Twentieth Supplemental Indenture and the Notes shall be governed by, and construed in accordance with, the laws of the State of New York.

This Twentieth Supplemental Indenture may be executed in any number of counterparts, each of which so executed shall be deemed to be an original, but all such counterparts shall together constitute but one and the same instrument.

IN WITNESS WHEREOF, the parties hereto have caused this Twentieth Supplemental Indenture to be duly executed and attested, all as of the day and year first above written.

THE DETROIT EDISON COMPANY

                                        By: /s/ Paul A. Stadnikia
                                            ------------------------------------
                                        Name: Paul A. Stadnikia
                                        Title: Assistant Treasurer


ATTEST:


By: /s/ Sandra Kay Ennis
    ---------------------------------
Name: Sandra Kay Ennis
Title: Corporate Secretary

J.P. MORGAN TRUST COMPANY,
NATIONAL ASSOCIATION, as Trustee

                                        By: /s/ J. Michael Banas
                                            ------------------------------------
                                        Name: J. Michael Banas
                                        Title: Vice President


ATTEST:


By: /s/ Alexis M. Johnson
    ---------------------------------
Name: Alexis M. Johnson
Title: Authorized Officer

EXHIBIT A

THIS NOTE IS A GLOBAL SECURITY WITHIN THE MEANING OF THE INDENTURE HEREINAFTER REFERRED TO AND IS REGISTERED IN THE NAME OF A DEPOSITORY OR A NOMINEE OF A DEPOSITORY. UNLESS AND UNTIL IT IS EXCHANGED IN WHOLE OR IN PART FOR NOTES IN CERTIFICATED FORM, THIS NOTE MAY NOT BE TRANSFERRED EXCEPT AS A WHOLE BY THE DEPOSITORY TRUST COMPANY ("DTC"), TO A NOMINEE OF DTC OR BY DTC OR ANY SUCH NOMINEE TO A SUCCESSOR OF DTC OR A NOMINEE OF SUCH SUCCESSOR. UNLESS THIS NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF DTC TO THE ISSUER OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY NOTE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT HEREON IS MADE TO CEDE & CO., OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC)

ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY A PERSON IS
WRONGFUL, INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST
HEREIN.

NO. R-___                                                          $____________
CUSIP ____________

THE DETROIT EDISON COMPANY

2006 SERIES A 6.625% SENIOR NOTES DUE 2036

Principal Amount: $____________

Authorized Denomination: $1,000

Regular Record Date: close of business on the 15th calendar day (whether or not a Business Day) prior to the relevant Interest Payment Date

Original Issue Date: May 24, 2006

Stated Maturity: June 1, 2036

Interest Payment Dates: June 1 and December 1 of each year, commencing December 1, 2006

Interest Rate: 6.625% per annum

THE DETROIT EDISON COMPANY, a corporation duly organized and existing under the laws of the State of Michigan (the "Company", which term includes any successor corporation under the Indenture hereinafter referred to), for value received, hereby promises to pay to Cede & Co. or registered assigns, at the office or agency of the Company in The City of New York, New York, the principal sum of ____________________ ($_______) on June 1, 2036 (the "Stated Maturity"), in the coin or currency of the United States, and to pay interest thereon from the Original Issue Date shown above, or from the most recent Interest Payment Date to which interest has been paid or duly provided for, in arrears on each Interest Payment Date as specified above, commencing on December 1, 2006 and on the Stated Maturity at the rate per

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annum shown above (the "Interest Rate") until the principal hereof is due and payable, and on any overdue principal and premium and on any overdue installment of interest. The interest installment so payable, and punctually paid or duly provided for, on any Interest Payment Date will, as provided in the Indenture, be paid to the Person in whose name this Note (or one or more Predecessor Securities) is registered on the Regular Record Date as specified above next preceding such Interest Payment Date. Except as otherwise provided in the Indenture, any such interest not so punctually paid or duly provided for will forthwith cease to be payable to the Holder on such Regular Record Date and may either be paid to the Person in whose name this Note (or one or more Predecessor Securities) is registered at the close of business on a Special Record Date to be fixed by the Trustee for the payment of such defaulted interest, notice whereof shall be given to Holders of Notes of this series not less than ten days prior to such Special Record Date, or may be paid at any time in any other lawful manner not inconsistent with the requirements of any securities exchange, if any, on which the Notes of this series shall be listed, and upon such notice as may be required by any such exchange, all as more fully provided in the Indenture.

Payments of interest on this Note will include interest accrued to but excluding the respective Interest Payment Dates. Interest payments for this Note shall be computed and paid on the basis of a 360-day year of twelve 30-day months. The Company shall pay interest on overdue principal and premium, if any, and, to the extent lawful, on overdue installments of interest at the rate per annum borne by this Note. In the event that any Interest Payment Date, Redemption Date or Maturity Date is not a Business Day, then the required payment of principal, premium, if any, and interest will be made on the next succeeding day that is a Business Day (and without any interest or other payment in respect of any such delay), in each case with the same force and effect as if made on such date. "Business Day" means any day other than a day on which banking institutions in the State of New York or the State of Michigan are authorized or obligated pursuant to law or executive order to close.

Payment of principal of, premium, if any, and interest on the Notes shall be made in such coin or currency of the United States of America as at the time of payment is legal tender for payment of public and private debts. Payments of principal of, premium, if any, and interest on Notes represented by a Global Security shall be made by wire transfer of immediately available funds to the Holder of such Global Security, provided that, in the case of payments of principal and premium, if any, such Global Security is first surrendered to the Paying Agent (as defined in the Indenture). If any of the Notes of this series are no longer represented by a Global Security, (i) payments of principal, premium, if any, and interest due at the Stated Maturity or earlier redemption of such Securities shall be made at the office of the Paying Agent upon surrender of such Securities to the Paying Agent, and (ii) payments of interest shall be made, at the option of the Company, subject to such surrender where applicable, by check mailed to the address of the Person entitled thereto as such address shall appear in the Security Register.

UNTIL THE RELEASE DATE (AS DEFINED BELOW), THIS NOTE SHALL BE SECURED BY GENERAL AND REFUNDING MORTGAGE BONDS, 2006 SERIES A (THE "MORTGAGE BONDS") ISSUED AND DELIVERED BY THE COMPANY TO THE TRUSTEE (AS DEFINED BELOW) UNDER THE COMPANY'S SUPPLEMENTAL INDENTURE DATED AS OF MAY 15, 2006, SUPPLEMENTING THE MORTGAGE AND DEED OF TRUST DATED AS OF OCTOBER 1, 1924 BETWEEN THE COMPANY AND J.P. MORGAN TRUST COMPANY, NATIONAL ASSOCIATION (THE "MORTGAGE TRUSTEE"), PLEDGED BY THE COMPANY FOR THE BENEFIT OF THE HOLDERS OF

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THE NOTES TO THE TRUSTEE UNDER THE INDENTURE (THE "MORTGAGE"). ON THE RELEASE DATE, THE NOTES SHALL CEASE TO BE SECURED BY SUCH MORTGAGE BONDS AND, AT THE COMPANY'S OPTION, SHALL EITHER (1) BECOME UNSECURED GENERAL OBLIGATIONS OF THE COMPANY OR (2) BE SECURED BY SUBSTITUTE MORTGAGE BONDS UNDER A SUBSTITUTE MORTGAGE.

This Note shall not be entitled to any benefit under the Indenture hereinafter referred to, be valid or become obligatory for any purpose until the Certificate of Authentication hereon shall have been signed by or on behalf of the Trustee.

Unless the Certificate of Authentication hereon has been executed by the Trustee or a duly appointed Authentication Agent referred to herein, this Note shall not be entitled to any benefit under the Indenture or be valid or obligatory for any purpose.

This Note is one of a duly authorized series of Securities of the Company (herein sometimes referred to as the "Notes"), specified in the Indenture, all issued or to be issued in one or more series under and pursuant to a Collateral Trust Indenture dated as of June 30, 1993 (the "Original Indenture") duly executed and delivered between the Company and J.P. Morgan Trust Company, National Association, as successor Trustee (herein referred to as the "Trustee"), as supplemented through and including a Twentieth Supplemental Indenture dated as of May 15, 2006 (together with the Original Indenture, the "Indenture") between the Company and the Trustee, to which Indenture and all indentures supplemental thereto reference is hereby made for a description of the respective rights, limitations of rights, obligations, duties and immunities thereunder of the Trustee, the Company and the registered Holders of the Notes and of the terms upon which the Notes are, and are to be, authenticated and delivered.

This Note is not subject to repayment at the option of the Holder hereof. Except as provided below, this Note is not redeemable by the Company prior to maturity and is not subject to any sinking fund.

This Note will be redeemable at the option of the Company, in whole at any time or in part from time to time (any such date of optional redemption, an "Optional Redemption Date," which shall be a "Redemption Date" for purposes of the Indenture), at an optional redemption price (which shall be a "Redemption Price" for purposes of the Indenture) equal to the greater of (i) 100% of the principal amount of this Note to be redeemed and (ii) the sum of the present values of the remaining scheduled payments of principal and interest of this Note to be redeemed (not including any portion of any payments of interest accrued to the Optional Redemption Date) until Stated Maturity, in each case discounted from their respective scheduled payment dates to such Optional Redemption Date on a semiannual basis (assuming a 360-day year consisting of 30-day months) at the Adjusted Treasury Rate (as defined below) plus 30 basis points, as determined by the Reference Treasury Dealer (as defined below), plus, in each case, accrued and unpaid interest thereon to the Redemption Date.

Notwithstanding the foregoing, installments of interest on this Note that are due and payable on Interest Payment Dates falling on or prior to a Redemption Date will be payable on the Interest Payment Date to the registered Holders as of the close of business on the relevant Record Date.

"Adjusted Treasury Rate" means, with respect to any Optional Redemption Date, the rate per annum equal to the semiannual equivalent yield to maturity of the Comparable Treasury

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Issue, calculated on the third Business Day preceding such Optional Redemption Date assuming a price for the Comparable Treasury Issue (expressed as a percentage of its principal amount) equal to the Comparable Treasury Price for such Optional Redemption Date.

"Comparable Treasury Issue" means the United States Treasury security selected by the Reference Treasury Dealer as having a maturity comparable to the remaining term of this Note that would be utilized, at the time of selection and in accordance with customary financial practice, in pricing new issues of corporate debt securities of comparable maturity to the remaining term of this Note.

"Comparable Treasury Price" means, with respect to any Optional Redemption Date, (i) the average of the Reference Treasury Dealer Quotations for such Optional Redemption Date, after excluding the highest and lowest such Reference Treasury Dealer Quotations, or (ii) if the Trustee obtains fewer than two such Reference Treasury Dealer Quotations, the average of all such quotations, or
(iii) if only one Reference Treasury Dealer Quotation is received, such quotation.

"Reference Treasury Dealer" means each of: (i) Barclays Capital Inc., Citigroup Global Markets Inc., and J.P. Morgan Securities Inc. (or their respective affiliates which are Primary Treasury Dealers), and their respective successors; provided, however, that if any of the foregoing shall cease to be a primary U.S. government securities dealer in the United States (a "Primary Treasury Dealer"), the Company will substitute therefor another Primary Treasury Dealer; and (ii) any other Primary Treasury Dealer(s) selected by the Trustee after consultation with the Company.

"Reference Treasury Dealer Quotation" means, with respect to each Reference Treasury Dealer and any Optional Redemption Date, the average, as determined by the Trustee, of the bid and asked prices for the Comparable Treasury Issue (expressed in each case as a percentage of its principal amount) quoted in writing to the Trustee by such Reference Treasury Dealer at 5:00 p.m., New York City time, on the third Business Day preceding such Optional Redemption Date.

Notice of any optional redemption will be mailed at least 30 days but not more than 60 days before the Optional Redemption Date to the Holder hereof at its registered address.

If notice has been provided in accordance with the Indenture and funds for the redemption of this Note called for redemption have been made available on the Redemption Date, this Note will cease to bear interest on the date fixed for redemption. Thereafter, the only right of the Holder hereof will be to receive payment of the Redemption Price.

The Company will notify the Trustee at least 60 days prior to giving notice of redemption (or such shorter period as is satisfactory to the Trustee) of the aggregate principal amount of Notes to be redeemed and the Redemption Date. If the Company elects to redeem all or a portion of the Notes, the redemption will be conditional upon receipt by the Paying Agent or the Trustee of monies sufficient to pay the Redemption Price. If the Notes are only partially redeemed by the Company, the Trustee shall select which Notes are to be redeemed in a manner it deems fair and appropriate in accordance with the terms of the Indenture.

In the event of redemption of this Note in part only, a new Note or Notes of this series for the unredeemed portion hereof will be issued in the name of the registered Holder hereof upon the cancellation hereof.

A-4

In case an Event of Default, as defined in the Indenture, shall have occurred and be continuing, the principal of all of the Notes may be declared, and upon such declaration shall become, due and payable, in the manner, with the effect and subject to the conditions provided in the Indenture.

The Indenture contains provisions for defeasance at any time of the entire indebtedness of this Note upon compliance by the Company with certain conditions set forth therein.

The Indenture contains provisions permitting the Company and the Trustee, with the consent of the registered Holders of not less than a majority in aggregate principal amount of the outstanding Securities of each series affected at the time, as defined in the Indenture, to execute supplemental indentures for the purpose of adding any provisions to or changing in any manner or eliminating any of the provisions of the Indenture or of any supplemental indenture or of modifying in any manner the rights of the registered Holders of the Securities; provided, however, that no such supplemental indenture shall (i) extend the fixed maturity of any Securities of any series, or reduce the principal amount thereof, or reduce the rate of or extend the time of payment of interest thereon, or reduce any premium payable upon the redemption thereof, without the consent of the registered Holder of each Security so affected or (ii) reduce the aforesaid percentage of Securities, the registered Holders of which are required to consent to any such supplemental indenture, without the consent of the registered Holders of each Security then outstanding and affected thereby. The Indenture also contains provisions permitting (i) the registered Holders of at least 66 2/3% in aggregate principal amount of the Securities of all series at the time outstanding affected thereby, on behalf of the registered Holders of the Securities of such series, to waive compliance by the Company with certain provisions of the Indenture and (ii) the registered Holders of a majority in aggregate principal amount of the Securities of all series at the time outstanding affected thereby, on behalf of the registered Holders of the Securities of such series, to waive certain past defaults under the Indenture and their consequences. Any such consent or waiver by the registered Holder of this Note (unless revoked as provided in the Indenture) shall be conclusive and binding upon such registered Holder and upon all future registered Holders and owners of this Note and of any Note issued in exchange hereof or in place hereof (whether by registration of transfer or otherwise), irrespective of whether or not any notation of such consent or waiver is made upon this Note.

No reference herein to the Indenture and no provision of this Note or of the Indenture shall alter or impair the obligation of the Company, which is absolute and unconditional, to pay the principal of and interest on this Note at the time and place and at the rate and in the coin or currency herein prescribed.

Prior to the Release Date, the Notes of this series shall be secured by a series of Mortgage Bonds (the "Related Series of Bonds"), delivered by the Company to the Trustee for the benefit of the Holders of the Notes. Reference is made to the Mortgage and the Indenture for a description of the rights of the Trustee as Holder of the Related Series of Bonds, the property mortgaged and pledged under the Mortgage and the rights of the Company and of the Mortgage Trustee in respect thereof, the duties and immunities of the Mortgage Trustee and the terms and conditions upon which the Related Series of Bonds are secured and the circumstances under which additional Mortgage Bonds may be issued.

FROM AND AFTER SUCH TIME AS ALL BONDS, OTHER THAN (1) PLEDGED BONDS,

INCLUDING THE RELATED SERIES OF BONDS, AND (2) MORTGAGE BONDS

A-5

(EXCLUSIVE OF PLEDGED BONDS) WHICH DO NOT IN AGGREGATE PRINCIPAL AMOUNT EXCEED THE GREATER OF FIVE PERCENT (5%) OF NET TANGIBLE ASSETS OR FIVE PERCENT (5%) OF CAPITALIZATION, HAVE BEEN RETIRED THROUGH PAYMENT, REDEMPTION OR OTHERWISE (INCLUDING THOSE MORTGAGE BONDS THE PAYMENT FOR WHICH HAS BEEN PROVIDED FOR IN ACCORDANCE WITH THE MORTGAGE) AT, BEFORE OR AFTER THE MATURITY THEREOF, PROVIDED THAT NO DEFAULT OR EVENT OF DEFAULT HAS OCCURRED AND IS CONTINUING (THE "RELEASE DATE"), THE RELATED SERIES OF BONDS SHALL CEASE TO SECURE THE NOTES IN ANY MANNER.

As provided in the Indenture and subject to certain limitations therein set forth, the transfer of this Note is registrable in the Security Register of the Company, upon surrender of this Note for registration of transfer at the office or agency of the Company in any place where the principal of and any interest on this Note are payable or at such other offices or agencies as the Company may designate, duly endorsed by or accompanied by a written instrument or instruments of transfer in form satisfactory to the Company and the Security Registrar or any transfer agent duly executed by the registered Holder hereof or his or her attorney duly authorized in writing, and thereupon one or more new Notes of this series and of like tenor, of authorized denominations and for the same aggregate principal amount will be issued to the designated transferee or transferees. No service charge will be made for any such transfer, but the Company may require payment of a sum sufficient to cover any tax or other governmental charge payable in relation thereto.

Prior to due presentment for registration of transfer of this Note, the Company, the Trustee, any Paying Agent and any Note Registrar may deem and treat the registered Holder hereof as the absolute owner hereof (whether or not this Note shall be overdue and notwithstanding any notice of ownership or writing hereon made by anyone other than the Note Registrar) for the purpose of receiving payment of or on account of the principal hereof and interest due hereon and for all other purposes, and neither the Company nor the Trustee nor any Paying Agent nor any Security Registrar shall be affected by any notice to the contrary.

The Notes of this series are issuable only in fully registered form without coupons in denominations of $1,000 and any integral multiple thereof. This Global Security is exchangeable for Notes in definitive form only under certain limited circumstances set forth in the Indenture. As provided in the Indenture and subject to certain limitations therein set forth, Notes of this series are exchangeable for a like aggregate principal amount of Notes of this series of a different authorized denomination, as requested by the registered Holder surrendering the same.

As set forth in, and subject to the provisions of, the Indenture, no Holder of any Note will have any right to institute any proceeding with respect to the Indenture or for any remedy thereunder, unless (i) such Holder shall have previously given to the Trustee written notice of a continuing Event of Default with respect to the Notes of this series, (ii) the Holders of not less than 25% in principal amount of the outstanding Notes of this series shall have made written request, and offered reasonable indemnity, to the Trustee to institute such proceeding as trustee, (iii) the Trustee shall have failed to institute such proceeding within 60 days and (iv) the Trustee shall not have received from the Holders of a majority in principal amount of the outstanding Notes of this series a direction inconsistent with such request within such 60-day period; provided, however, that such limitations do not apply to a suit instituted by the Holder hereof for

A-6

the enforcement of payment of the principal of or any interest on this Note on or after the respective due dates expressed herein.

All terms used in this Note which are defined in the Indenture shall have the meanings assigned to them in the Indenture.

A-7

IN WITNESS WHEREOF, the parties hereto have caused this Note to be duly executed and attested, all as of the day and year first above written.

THE DETROIT EDISON COMPANY

[Corporate Seal]

By:
Name:
Title:

ATTEST:

By:
Name:
Title:

A-8

CERTIFICATE OF AUTHENTICATION

This is one of the Notes of the series of Notes described in the within mentioned Indenture.

J.P. MORGAN TRUST COMPANY,
NATIONAL ASSOCIATION
as Trustee

By:
Authorized Signatory

Date:

A-9

FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and transfer(s) unto

(Please insert Social Security or Other Identifying Number of Assignee)

(Please print or type name and address, including zip code of assignee)

the within Note and all rights thereunder, hereby irrevocably constituting and appointing such person attorneys to transfer the within Note on the books of the Issuer, with full power of substitution in the premises.

Dated: __________________

NOTICE: The signature of this assignment must correspond with the name as written upon the face of the within Note in every particular, without alteration or enlargement or any change whatever and NOTICE: Signature(s) must be guaranteed by a financial institution that is a member of the Securities Transfer Agents Medallion Program ("STAMP"), the Stock Exchange, Inc. Medallion Signature Program ("MSP"). When assignment is made by a guardian, trustee, executor or administrator, an officer of a corporation, or anyone in a representative capacity, proof of his or her authority to act must accompany this Note.

A-10

Exhibit 4-250

INDENTURE

DATED AS OF MAY 15, 2006

THE DETROIT EDISON COMPANY
(2000 2nd Avenue, Detroit, Michigan 48226)

J.P. MORGAN TRUST COMPANY, NATIONAL ASSOCIATION
(611 Woodward Avenue, Detroit, Michigan 48226)

AS TRUSTEE

SUPPLEMENTAL TO MORTGAGE AND DEED OF TRUST
DATED AS OF OCTOBER 1, 1924

PROVIDING FOR

(A) GENERAL AND REFUNDING MORTGAGE BONDS,
2006 SERIES A

AND

(B) RECORDING AND FILING DATA

TABLE OF CONTENTS*

                                                                            PAGE
                                                                            ----
PARTIES..................................................................     3
RECITALS.................................................................     3
   Original Indenture and Supplementals..................................     3
   Issue of Bonds Under Indenture........................................     3
   Bonds Heretofore Issued...............................................     4
   Reason for Creation of New Series.....................................    10
   Bonds to be 2006 Series A.............................................    10
   Further Assurance.....................................................    10
   Authorization of Supplemental Indenture...............................    10
   Consideration for Supplemental Indenture..............................    10
PART I.   CREATION OF THREE HUNDRED FORTY-SIXTH SERIES OF BONDS, GENERAL
          AND REFUNDING MORTGAGE BONDS, 2006 SERIES A....................    11
   Sec. 1. Terms of Bonds of 2006 Series A...............................    11
   Sec. 2. Release.......................................................    13
   Sec. 3. Redemption of Bonds of 2006 Series A..........................    13
   Sec. 4. Redemption of Bonds of 2006 Series A in Event of Acceleration
           of Notes......................................................    13
   Sec. 5. Form of Bonds of 2006 Series A................................    14
           Form of Trustee's Certificate.................................    16
           Form of Reverse of Bond.......................................    16
PART II.  RECORDING AND FILING DATA......................................    18
   Recording and Filing of Original Indenture............................    18
   Recording and Filing of Supplemental Indentures.......................    19
   Recording and Filing of Supplemental Indenture Dated as of February 1,
   2005..................................................................    24
   Recording and Filing of Supplemental Indenture Dated as of April 1,
   2005..................................................................    24
   Recording and Filing of Supplemental Indenture Dated as of August 1,
   2005..................................................................    25
   Recording and Filing of Supplemental Indenture Dated as of
   September 15, 2005....................................................    25
   Recording and Filing of Supplemental Indenture Dated as of September
   30, 2005..............................................................    26
   Recording of Certificates of Provision for Payment....................    27
PART III. THE TRUSTEE....................................................    27
   Terms and Conditions of Acceptance of Trust by Trustee................    27
PART IV.  MISCELLANEOUS..................................................    28
   Confirmation of Section 318(c) of Trust Indenture Act.................    28
   Execution in Counterparts.............................................    28
   Testimonium...........................................................    28
   Execution by Company..................................................    29
   Acknowledgment of Execution by Company................................    30
   Execution by Trustee..................................................    31
   Acknowledgment of Execution by Trustee................................    32
   Affidavit as to Consideration and Good Faith..........................    33

* This Table of Contents shall not have any bearing upon the interpretation of any of the terms or provisions of this Indenture.

PARTIES.                         SUPPLEMENTAL INDENTURE, dated as of the 15th day of May, in the year
                                 2006, between THE DETROIT EDISON COMPANY, a corporation organized and
                                 existing under the laws of the State of Michigan and a public utility
                                 (hereinafter called the "Company"), party of the first part, and J.P.
                                 Morgan Trust Company, National Association, a trust company organized
                                 and existing under the laws of the United States, having a corporate
                                 trust office at 611 Woodward Avenue, Detroit, Michigan 48226, as
                                 successor Trustee under the Mortgage and Deed of Trust hereinafter
                                 mentioned (hereinafter called the "Trustee"), party of the second
                                 part.

ORIGINAL INDENTURE AND           WHEREAS, the Company has heretofore executed and delivered its
SUPPLEMENTALS.                   Mortgage and Deed of Trust (hereinafter referred to as the "Original
                                 Indenture"), dated as of October 1, 1924, to the Trustee, for the
                                 security of all bonds of the Company outstanding thereunder, and
                                 pursuant to the terms and provisions of the Original Indenture,
                                 indentures dated as of, respectively, June 1, 1925, August 1, 1927,
                                 February 1, 1931, June 1, 1931, October 1, 1932, September 25, 1935,
                                 September 1, 1936, November 1, 1936, February 1, 1940, December 1,
                                 1940, September 1, 1947, March 1, 1950, November 15, 1951, January
                                 15, 1953, May 1, 1953, March 15, 1954, May 15, 1955, August 15, 1957,
                                 June 1, 1959, December 1, 1966, October 1, 1968, December 1, 1969,
                                 July 1, 1970, December 15, 1970, June 15, 1971, November 15, 1971,
                                 January 15, 1973, May 1, 1974, October 1, 1974, January 15, 1975,
                                 November 1, 1975, December 15, 1975, February 1, 1976, June 15, 1976,
                                 July 15, 1976, February 15, 1977, March 1, 1977, June 15, 1977, July
                                 1, 1977, October 1, 1977, June 1, 1978, October 15, 1978, March 15,
                                 1979, July 1, 1979, September 1, 1979, September 15, 1979, January 1,
                                 1980, April 1, 1980, August 15, 1980, August 1, 1981, November 1,
                                 1981, June 30, 1982, August 15, 1982, June 1, 1983, October 1, 1984,
                                 May 1, 1985, May 15, 1985, October 15, 1985, April 1, 1986, August
                                 15, 1986, November 30, 1986, January 31, 1987, April 1, 1987, August
                                 15, 1987, November 30, 1987, June 15, 1989, July 15, 1989, December
                                 1, 1989, February 15, 1990, November 1, 1990, April 1, 1991, May 1,
                                 1991, May 15, 1991, September 1, 1991, November 1, 1991, January 15,
                                 1992, February 29, 1992, April 15, 1992, July 15, 1992, July 31,
                                 1992, November 30, 1992, December 15, 1992, January 1, 1993, March 1,
                                 1993, March 15, 1993, April 1, 1993, April 26, 1993, May 31, 1993,
                                 June 30, 1993, June 30, 1993, September 15, 1993, March 1, 1994, June
                                 15, 1994, August 15, 1994, December 1, 1994, August 1, 1995, August
                                 1, 1999, August 15, 1999, January 1, 2000, April 15, 2000, August 1,
                                 2000, March 15, 2001, May 1, 2001, August 15, 2001, September 15,
                                 2001, September 17, 2002, October 15, 2002, December 1, 2002, August
                                 1, 2003, March 15, 2004, July 1, 2004, February 1, 2005, April 1,
                                 2005, August 1, 2005, September 15, 2005, and September 30, 2005
                                 supplemental to the Original Indenture, have heretofore been entered
                                 into between the Company and the Trustee (the Original Indenture and
                                 all indentures supplemental thereto together being hereinafter
                                 sometimes referred to as the "Indenture"); and

ISSUE OF BONDS UNDER             WHEREAS, the Indenture provides that said bonds shall be issuable in
INDENTURE.                       one or more series, and makes provision that the rates of interest
                                 and dates for the payment thereof, the date of maturity or dates of
                                 maturity, if of serial maturity, the terms and rates of optional
                                 redemption (if redeemable), the forms of registered bonds without
                                 coupons of any series and any other provisions and agreements in
                                 respect thereof, in the Indenture provided and permitted, as the

                                 Board of Directors may determine, may be expressed in a supplemental
                                 indenture to be made by the Company to the Trustee thereunder; and

BONDS HERETOFORE ISSUED.         WHEREAS, bonds in the principal amount of Twelve billion ninety-two
                                 million eight hundred two thousand dollars ($12,092,802,000) have
                                 heretofore been issued under the Indenture as follows, viz:

           (1)                   Bonds of Series A                   -- Principal Amount $26,016,000,

           (2)                   Bonds of Series B                   -- Principal Amount $23,000,000,

           (3)                   Bonds of Series C                   -- Principal Amount $20,000,000,

           (4)                   Bonds of Series D                   -- Principal Amount $50,000,000,

           (5)                   Bonds of Series E                   -- Principal Amount $15,000,000,

           (6)                   Bonds of Series F                   -- Principal Amount $49,000,000,

           (7)                   Bonds of Series G                   -- Principal Amount $35,000,000,

           (8)                   Bonds of Series H                   -- Principal Amount $50,000,000,

           (9)                   Bonds of Series I                   -- Principal Amount $60,000,000,

           (10)                  Bonds of Series J                   -- Principal Amount $35,000,000,

           (11)                  Bonds of Series K                   -- Principal Amount $40,000,000,

           (12)                  Bonds of Series L                   -- Principal Amount $24,000,000,

           (13)                  Bonds of Series M                   -- Principal Amount $40,000,000,

           (14)                  Bonds of Series N                   -- Principal Amount $40,000,000,

           (15)                  Bonds of Series O                   -- Principal Amount $60,000,000,

           (16)                  Bonds of Series P                   -- Principal Amount $70,000,000,

           (17)                  Bonds of Series Q                   -- Principal Amount $40,000,000,

           (18)                  Bonds of Series W                   -- Principal Amount $50,000,000,

           (19)                  Bonds of Series AA                  -- Principal Amount $100,000,000,

           (20)                  Bonds of Series BB                  -- Principal Amount $50,000,000,

           (21)                  Bonds of Series CC                  -- Principal Amount $50,000,000,

           (22)                  Bonds of Series UU                  -- Principal Amount $100,000,000,

           (23-31)               Bonds of Series DDP Nos. 1-9        -- Principal Amount $14,305,000,

(32-45)               Bonds of Series FFR Nos. 1-14       -- Principal Amount $45,600,000,

(46-67)               Bonds of Series GGP Nos. 1-22       -- Principal Amount $42,300,000,

(68)                  Bonds of Series HH                  -- Principal Amount $50,000,000,

(69-90)               Bonds of Series IIP Nos. 1-22       -- Principal Amount $3,750,000,

(91-98)               Bonds of Series JJP Nos. 1-8        -- Principal Amount $6,850,000,

(99-107)              Bonds of Series KKP Nos. 1-9        -- Principal Amount $34,890,000,

(108-122)             Bonds of Series LLP Nos. 1-15       -- Principal Amount $8,850,000,

(123-143)             Bonds of Series NNP Nos. 1-21       -- Principal Amount $47,950,000,

(144-161)             Bonds of Series OOP Nos. 1-18       -- Principal Amount $18,880,000,

(162-180)             Bonds of Series QQP Nos. 1-19       -- Principal Amount $13,650,000,

(181-195)             Bonds of Series TTP Nos. 1-15       -- Principal Amount $3,800,000,

(196)                 Bonds of 1980 Series A              -- Principal Amount $50,000,000,

(197-221)             Bonds of 1980 Series CP Nos. 1-25   -- Principal Amount $35,000,000,

(222-232)             Bonds of 1980 Series DP Nos. 1-11   -- Principal Amount $10,750,000,

(233-248)             Bonds of 1981 Series AP Nos. 1-16   -- Principal Amount $124,000,000,

(249)                 Bonds of 1985 Series A              -- Principal Amount $35,000,000,

(250)                 Bonds of 1985 Series B              -- Principal Amount $50,000,000,

(251)                 Bonds of Series PP                  -- Principal Amount $70,000,000,

(252)                 Bonds of Series RR                  -- Principal Amount $70,000,000,

(253)                 Bonds of Series EE                  -- Principal Amount $50,000,000,

(254-255)             Bonds of Series MMP and MMP No. 2   -- Principal Amount $5,430,000,

(256)                 Bonds of Series T                   -- Principal Amount $75,000,000,

(257)                 Bonds of Series U                   -- Principal Amount $75,000,000,

(258)                 Bonds of 1986 Series B              -- Principal Amount $100,000,000,

(259)                 Bonds of 1987 Series D              -- Principal Amount $250,000,000,

(260)                 Bonds of 1987 Series E              -- Principal Amount $150,000,000,

(261)                 Bonds of 1987 Series C              -- Principal Amount $225,000,000,

(262)                 Bonds of Series V                   -- Principal Amount $100,000,000,

(263)                 Bonds of Series SS                  -- Principal Amount $150,000,000,

(264)                 Bonds of 1980 Series B              -- Principal Amount $100,000,000,

(265)                 Bonds of 1986 Series C              -- Principal Amount $200,000,000,

(266)                 Bonds of 1986 Series A              -- Principal Amount $200,000,000,

(267)                 Bonds of 1987 Series B              -- Principal Amount $175,000,000,

(268)                 Bonds of Series X                   -- Principal Amount $100,000,000,

(269)                 Bonds of 1987 Series F              -- Principal Amount $200,000,000,

(270)                 Bonds of 1987 Series A              -- Principal Amount $300,000,000,

(271)                 Bonds of Series Y                   -- Principal Amount $60,000,000,

(272)                 Bonds of Series Z                   -- Principal Amount $100,000,000,

(273)                 Bonds of 1989 Series A              -- Principal Amount $300,000,000,

(274)                 Bonds of 1984 Series AP             -- Principal Amount $2,400,000,

(275)                 Bonds of 1984 Series BP             -- Principal Amount $7,750,000,

(276)                 Bonds of Series R                   -- Principal Amount $100,000,000,

(277)                 Bonds of Series S                   -- Principal Amount $150,000,000,

(278)                 Bonds of 1993 Series D              -- Principal Amount $100,000,000,

(279)                 Bonds of 1992 Series E              -- Principal Amount $50,000,000,

(280)                 Bonds of 1993 Series B              -- Principal Amount $50,000,000,

(281)                 Bonds of 1989 Series BP             -- Principal Amount $66,565,000,

(282)                 Bonds of 1990 Series A              -- Principal Amount $194,649,000,

(283)                 Bonds of 1990 Series D              -- Principal Amount $0,

(284)                 Bonds of 1993 Series G              -- Principal Amount $225,000,000,

(285)                 Bonds of 1993 Series K              -- Principal Amount $160,000,000,

(286)                 Bonds of 1991 Series EP             -- Principal Amount $41,480,000,

(287)                 Bonds of 1993 Series H              -- Principal Amount $50,000,000,

(288)                 Bonds of 1999 Series D              -- Principal Amount $40,000,000,

(289)                 Bonds of 1991 Series FP             -- Principal Amount $98,375,000,

(290)                 Bonds of 1992 Series BP             -- Principal Amount $20,975,000,

(291)                 Bonds of 1992 Series D              -- Principal Amount $300,000,000,

(292)                 Bonds of 1992 Series CP             -- Principal Amount $35,000,000,

(293)                 Bonds of 1993 Series C              -- Principal Amount $225,000,000,

(294)                 Bonds of 1993 Series E              -- Principal Amount $400,000,000,

(295)                 Bonds of 1993 Series J              -- Principal Amount $300,000,000,

(296-301)             Bonds of Series KKP Nos. 10-15      -- Principal Amount $179,590,000,

(302)                 Bonds of 1989 Series BP No. 2       -- Principal Amount $36,000,000,

(303)                 Bonds of 1993 Series FP             -- Principal Amount $5,685,000,

(304)                 Bonds of 1993 Series IP             -- Principal Amount $5,825,000,

(305)                 Bonds of 1994 Series AP             -- Principal Amount $7,535,000,

(306)                 Bonds of 1994 Series BP             -- Principal Amount $12,935,000,

(307)                 Bonds of 1994 Series DP             -- Principal Amount $23,700,000,

(308)                 Bonds of 1994 Series C              -- Principal Amount $200,000,000,

(309)                 Bonds of 2000 Series A              -- Principal Amount $220,000,000,

(310)                 Bonds of 2005 Series A              -- Principal Amount $200,000,000,

(311)                 Bonds of 1995 Series AP             -- Principal Amount $97,000,000,

(312)                 Bonds of 1995 Series BP             -- Principal Amount $22,175,000,

(313)                 Bonds of 2001 Series D              -- Principal Amount $200,000,000,
                                                             and

(314)                 Bonds of 2005 Series B              -- Principal Amount $200,000,000;

                      all of which have either been retired and cancelled, or no longer
                      represent obligations of the Company, having matured or having been
                      called for redemption and funds necessary to effect the payment,
                      redemption and retirement thereof having been deposited with the
                      Trustee as a special trust fund to be applied for such purpose;

(315)                 Bonds of 1990 Series B in the principal amount of Two hundred
                      fifty-six million nine hundred thirty-two thousand dollars
                      ($256,932,000) of which One hundred sixty-one million seven hundred
                      seventy-two thousand dollars ($161,772,000) principal amount have
                      heretofore been retired;

(316)                 Bonds of 1990 Series C in the principal amount of Eighty-five million
                      four hundred seventy-five thousand dollars ($85,475,000) of which
                      Fifty-eight million one hundred twenty-three thousand dollars
                      ($58,123,000) principal amount have heretofore been retired;

(317)                 INTENTIONALLY RESERVED FOR 1990 SERIES E;

(318)                 INTENTIONALLY RESERVED FOR 1990 SERIES F;

(319)                 Bonds of 1991 Series AP in the principal amount of Thirty-two million
                      three hundred seventy-five thousand dollars ($32,375,000), all of
                      which are outstanding at the date hereof;

(320)                 Bonds of 1991 Series BP in the principal amount of Twenty-five
                      million nine hundred ten thousand dollars ($25,910,000), all of which
                      are outstanding at the date hereof;

(321)                 Bonds of 1991 Series CP in the principal amount of Thirty-two million
                      eight hundred thousand dollars ($32,800,000), all of which are
                      outstanding at the date hereof;

(322)                 Bonds of 1991 Series DP in the principal amount of Thirty-seven
                      million six hundred thousand dollars ($37,600,000), all of which are
                      outstanding at the date hereof;

(323)                 Bonds of 1992 Series AP in the principal amount of Sixty-six million
                      dollars ($66,000,000), all of which are outstanding at the date
                      hereof;

(324)                 Bonds of 1993 Series AP in the principal amount of Sixty-five million
                      dollars ($65,000,000), all of which are outstanding at the date
                      hereof;

(325)                 Bonds of 1999 Series AP in the principal amount of One hundred
                      eighteen million three hundred sixty thousand dollars ($118,360,000),
                      all of which are outstanding at the date hereof;

(326)                 Bonds of 1999 Series BP in the principal amount of Thirty-nine
                      million seven hundred forty-five thousand dollars ($39,745,000), all
                      of which are outstanding of the date hereof;

(327)                 Bonds of 1999 Series CP in the principal amount of Sixty-six million
                      five hundred sixty-five thousand dollars ($66,565,000), all of which
                      are outstanding at the date hereof;

(328)                 Bonds of 2000 Series B in the principal amount of Fifty million seven
                      hundred forty-five thousand dollars ($50,745,000), all of which are
                      outstanding at the date hereof;

(329)                 Bonds of 2001 Series AP in the principal amount of Thirty-one million
                      ($31,000,000), all of which are outstanding at the date hereof;

(330)                 Bonds of 2001 Series BP in the principal amount of Eighty-two million
                      three hundred fifty thousand ($82,350,000), all of which are
                      outstanding at the date hereof;

(331)                 Bonds of 2001 Series CP in the principal amount of One hundred
                      thirty-nine million eight hundred fifty-five thousand dollars
                      ($139,855,000), all of which are outstanding at the date hereof;

(332)                 Bonds of 2001 Series E in the principal amount of Five hundred
                      million dollars ($500,000,000), all of which are outstanding at the
                      date hereof;

(333)                 Bonds of 2002 Series A in the principal amount of Two hundred
                      twenty-five million dollars ($225,000,000), all of which are
                      outstanding at the date hereof;

(334)                 Bonds of 2002 Series B in the principal amount of Two hundred
                      twenty-five million dollars ($225,000,000), all of which are
                      outstanding at the date hereof;

(335)                 Bonds of 2002 Series C in the principal amount of Sixty-four million
                      three hundred thousand dollars ($64,300,000), all of which are
                      outstanding at the date hereof;

(336)                 Bonds of 2002 Series D in the principal amount of Fifty-five million
                      nine hundred seventy-five thousand dollars ($55,975,000), all of
                      which are outstanding at the date hereof;

(337)                 Bonds of 2003 Series A in the principal amount of Forty-nine million
                      dollars ($49,000,000), all of which are outstanding at the date
                      hereof;

(338)                 Bonds of 2004 Series A in the principal amount of Thirty-six million
                      dollars ($36,000,000), all of which are outstanding at the date
                      hereof;

(339)                 Bonds of 2004 Series B in the principal amount of Thirty-one million
                      nine hundred eighty thousand dollars ($31,980,000), all of which are
                      outstanding at the date hereof;

(340)                 Bonds of 2004 Series D in the principal amount of Two hundred million
                      dollars ($200,000,000), all of which are outstanding at the date
                      hereof;

(341)                 Bonds of 2005 Series AR in the principal amount of Two hundred
                      million dollars ($200,000,000), all of which are outstanding at the
                      date hereof;

(342)                 Bonds of 2005 Series BR in the principal amount of Two hundred
                      million dollars ($200,000,000), all of which are outstanding at the
                      date hereof;

(343)                 Bonds of 2005 Series DT in the principal amount of One hundred
                      nineteen million one hundred seventy-five thousand dollars
                      ($119,175,000), all of which are outstanding at the date hereof;

(344)                 Bonds of 2005 Series C in the principal amount of One hundred million
                      dollars ($100,000,000), all of which are outstanding at the date
                      hereof; and

           (345)                 Bonds of 2005 Series E in the principal amount of Two hundred fifty
                                 million dollars ($250,000,000), all of which are outstanding at the
                                 date hereof;

                                 accordingly, the Company has issued and has presently outstanding
                                 Three billion one hundred sixty-seven million two hundred forty-seven
                                 thousand dollars ($3,167,247,000) aggregate principal amount of its
                                 General and Refunding Mortgage Bonds (the "Bonds") at the date
                                 hereof.

REASON FOR CREATION OF NEW       WHEREAS, the Company intends to issue a series of Notes under the
SERIES.                          Note Indenture herein referred to, and, pursuant to the Note
                                 Indenture, the Company has agreed to issue its General and Refunding
                                 Mortgage Bonds under the Indenture in order further to secure its
                                 obligations with respect to such Notes; and

BONDS TO BE 2006 SERIES A.       WHEREAS, for such purpose the Company desires by this Supplemental
                                 Indenture to create a new series of bonds, to be designated "General
                                 and Refunding Mortgage Bonds, 2006 Series A," in the aggregate
                                 principal amount of Two hundred fifty million dollars ($250,000,000),
                                 to be authenticated and delivered pursuant to Section 8 of Article
                                 III of the Indenture; and

FURTHER ASSURANCE.               WHEREAS, the Original Indenture, by its terms, includes in the
                                 property subject to the lien thereof all of the estates and
                                 properties, real, personal and mixed, rights, privileges and
                                 franchises of every nature and kind and wheresoever situate, then or
                                 thereafter owned or possessed by or belonging to the Company or to
                                 which it was then or at any time thereafter might be entitled in law
                                 or in equity (saving and excepting, however, the property therein
                                 specifically excepted or released from the lien thereof), and the
                                 Company therein covenanted that it would, upon reasonable request,
                                 execute and deliver such further instruments as may be necessary or
                                 proper for the better assuring and confirming unto the Trustee all or
                                 any part of the trust estate, whether then or thereafter owned or
                                 acquired by the Company (saving and excepting, however, property
                                 specifically excepted or released from the lien thereof); and

AUTHORIZATION OF SUPPLEMENTAL    WHEREAS, the Company in the exercise of the powers and authority
INDENTURE.                       conferred upon and reserved to it under and by virtue of the
                                 provisions of the Indenture, and pursuant to resolutions of its Board
                                 of Directors, has duly resolved and determined to make, execute and
                                 deliver to the Trustee a supplemental indenture in the form hereof
                                 for the purposes herein provided; and

                                 WHEREAS, all conditions and requirements necessary to make this
                                 Supplemental Indenture a valid and legally binding instrument in
                                 accordance with its terms have been done, performed and fulfilled,
                                 and the execution and delivery hereof have been in all respects duly
                                 authorized;

CONSIDERATION FOR SUPPLEMENTAL   NOW, THEREFORE, THIS INDENTURE WITNESSETH: That The Detroit Edison
INDENTURE.                       Company, in consideration of the premises and of the covenants
                                 contained in the Indenture and of the sum of One Dollar ($1.00) and
                                 other good and valuable consideration to it duly paid by the Trustee
                                 at or before the ensealing and delivery of these presents, the
                                 receipt whereof is hereby acknowledged, hereby covenants and agrees
                                 to and with the Trustee and its successors in the trusts under the
                                 Original Indenture and in said indentures

                                 supplemental thereto as follows:

                                                               PART I.

                                                CREATION OF THREE HUNDRED FORTY-SIXTH
                                                           SERIES OF BONDS,
                                                GENERAL AND REFUNDING MORTGAGE BONDS,
                                                            2006 SERIES A

TERMS OF BONDS OF 2006           SECTION 1. The Company hereby creates the three hundred forty-sixth
SERIES A.                        series of bonds to be issued under and secured by the Original
                                 Indenture as amended to date and as further amended by this
                                 Supplemental Indenture, to be designated, and to be distinguished
                                 from the bonds of all other series, by the title "General and
                                 Refunding Mortgage Bonds, 2006 Series A" (elsewhere herein referred
                                 to as the "bonds of 2006 Series A"). The aggregate principal amount
                                 of bonds of 2006 Series A shall be limited to Two hundred fifty
                                 million ($250,000,000), except as provided in Sections 7 and 13 of
                                 Article II of the Original Indenture with respect to exchanges and
                                 replacements of bonds, and except further that the Company may,
                                 without the consent of any holder of the bonds of 2006 Series A,
                                 "reopen" the bonds of 2006 Series A so as to increase the aggregate
                                 principal amount outstanding to equal the aggregate principal amount
                                 of Notes (as defined below) outstanding upon a "reopening" of the
                                 series, so long as any additional bonds of 2006 Series A have the
                                 same tenor and terms as the bonds of 2006 Series A established
                                 hereby.

                                 Subject to the release provisions set forth below, each bond of 2006
                                 Series A is to be irrevocably assigned to, and registered in the name
                                 of, J.P. Morgan Trust Company, National Association, as trustee, or a
                                 successor trustee (said trustee or any successor trustee being
                                 hereinafter referred to as the "Note Indenture Trustee"), under the
                                 collateral trust indenture, dated as of June 30, 1993, as
                                 supplemented (the "Note Indenture"), between the Note Indenture
                                 Trustee and the Company, to secure payment of the Company's 2006
                                 Series A 6.625% Senior Notes due 2036 (for purposes of this Part I,
                                 the "Notes").

                                 The bonds of 2006 Series A shall be issued as registered bonds
                                 without coupons in denominations of a multiple of $1,000. The bonds
                                 of 2006 Series A shall be issued in the aggregate principal amount of
                                 $250,000,000, shall mature on June 1, 2036 (subject to earlier
                                 redemption or release) and shall bear interest at the rate of 6.625%
                                 per annum, payable semi-annually in arrears on June 1 and December 1
                                 of each year (commencing December 1, 2006), until the principal
                                 thereof shall have become due and payable and thereafter until the
                                 Company's obligation with respect to the payment of said principal
                                 shall have been discharged as provided in the Indenture.

                                 The bonds of 2006 Series A shall be payable as to principal, premium,
                                 if any, and interest as provided in the Indenture, but only to the
                                 extent and in the manner herein provided. The bonds of 2006 Series A
                                 shall be payable, as to principal, premium, if any, and interest, at
                                 the office or agency of the Company in the Borough of Manhattan, the
                                 City and State of New York, in any coin or currency of the United
                                 States of America which at the time of payment is legal tender for
                                 public and private debts.

Except as provided herein, each bond of 2006 Series A shall be dated
the date of its authentication and interest shall be payable on the
principal represented thereby from the June 1 or December 1 next
preceding the date thereof to which interest has been paid on bonds
of 2006 Series A, unless the bond is authenticated on a date to which
interest has been paid, in which case interest shall be payable from
the date of authentication, or unless the date of authentication is
prior to December 1, 2006 in which case interest shall be payable
from May 24, 2006.

The bonds of 2006 Series A in definitive form shall be, at the
election of the Company, fully engraved or shall be lithographed or
printed in authorized denominations as aforesaid and numbered R-1 and
upwards (with such further designation as may be appropriate and
desirable to indicate by such designation the form, series and
denomination of bonds of 2006 Series A). Until bonds of 2006 Series A
in definitive form are ready for delivery, the Company may execute,
and upon its request in writing the Trustee shall authenticate and
deliver in lieu thereof, bonds of 2006 Series A in temporary form, as
provided in Section 10 of Article II of the Indenture. Temporary
bonds of 2006 Series A, if any, may be printed and may be issued in
authorized denominations in substantially the form of definitive
bonds of 2006 Series A, but without a recital of redemption prices
and with such omissions, insertions and variations as may be
appropriate for temporary bonds, all as may be determined by the
Company.

Interest on any bond of 2006 Series A that is payable on any interest
payment date and is punctually paid or duly provided for shall be
paid to the person in whose name that bond, or any previous bond to
the extent evidencing the same debt as that evidenced by that bond,
is registered at the close of business on the regular record date for
such interest, which regular record date shall be the fifteenth
calendar day (whether or not a business day) next preceding such
interest payment date. If the Company shall default in the payment of
the interest due on any interest payment date on the principal
represented by any bond of 2006 Series A, such defaulted interest
shall forthwith cease to be payable to the registered holder of that
bond on the relevant regular record date by virtue of his having been
such holder, and such defaulted interest may be paid to the
registered holder of that bond (or any bond or bonds of 2006 Series A
issued upon transfer or exchange thereof) on the date of payment of
such defaulted interest or, at the election of the Company, to the
person in whose name that bond (or any bond or bonds of 2006 Series A
issued upon transfer or exchange thereof) is registered on a
subsequent record date established by notice given by mail by or on
behalf of the Company to the holders of bonds of 2006 Series A not
less than ten (10) days preceding such subsequent record date, which
subsequent record date shall be at least five (5) days prior to the
payment date of such defaulted interest.

Bonds of 2006 Series A shall not be assignable or transferable except
as may be set forth under Section 405 of the Note Indenture or in the
supplemental note indenture relating to the Notes, or, subject to
compliance with applicable law, as may be involved in the course of
the exercise of rights and remedies consequent upon an Event of
Default under the Note Indenture. Any such transfer shall be made
upon surrender thereof for cancellation at the office or agency of
the Company in the Borough of Manhattan, the City and State of

                                 New York, together with a written instrument of transfer (if so
                                 required by the Company or by the Trustee) in form approved by the
                                 Company duly executed by the holder or by its duly authorized
                                 attorney. Bonds of 2006 Series A shall in the same manner be
                                 exchangeable for a like aggregate principal amount of bonds of 2006
                                 Series A upon the terms and conditions specified herein and in
                                 Section 7 of Article II of the Indenture. The Company waives its
                                 rights under Section 7 of Article II of the Indenture not to make
                                 exchanges or transfers of bonds of 2006 Series A during any period of
                                 ten (10) days next preceding any redemption date for such bonds.

                                 Bonds of 2006 Series A, in definitive and temporary form, may bear
                                 such legends as may be necessary to comply with any law or with any
                                 rules or regulations made pursuant thereto or as may be specified in
                                 the Note Indenture.

                                 Upon payment of the principal or premium, if any, or interest on the
                                 Notes, whether at maturity or prior to maturity by redemption or
                                 otherwise, or upon provision for the payment thereof having been made
                                 in accordance with Article V of the Note Indenture, bonds of 2006
                                 Series A in a principal amount equal to the principal amount of such
                                 Notes, shall, to the extent of such payment of principal, premium or
                                 interest, be deemed fully paid and the obligation of the Company
                                 thereunder to make such payment shall forthwith cease and be
                                 discharged, and, in the case of the payment of principal and premium,
                                 if any, such bonds shall be surrendered for cancellation or presented
                                 for appropriate notation to the Trustee.

RELEASE.                         SECTION 2. From and after the Release Date (as defined in the Note
                                 Indenture), the bonds of 2006 Series A shall be deemed fully paid,
                                 satisfied and discharged and the obligation of the Company thereunder
                                 shall be terminated. On the Release Date, the bonds of 2006 Series A
                                 shall be surrendered to and canceled by the Trustee. The Company
                                 covenants and agrees that, prior to the Release Date, it will not
                                 take any action that would cause the outstanding principal amount of
                                 the bonds of 2006 Series A to be less than the then outstanding
                                 principal amount of the Notes.

REDEMPTION OF BONDS OF           SECTION 3. Bonds of 2006 Series A shall be redeemed on the respective
2006 SERIES A.                   dates and in the respective principal amounts which correspond to the
                                 redemption dates for, and the principal amounts to be redeemed of,
                                 the Notes.

                                 In the event the Company elects to redeem any Notes prior to maturity
                                 in accordance with the provisions of the Note Indenture, the Company
                                 shall give the Trustee notice of redemption of bonds of 2006 Series A
                                 on the same date as it gives notice of redemption of Notes to the
                                 Note Indenture Trustee.

REDEMPTION OF BONDS OF 2006      SECTION 4. In the event of an Event of Default under the Note
SERIES A IN EVENT OF             Indenture and the acceleration of all Notes, the bonds of 2006 Series
ACCELERATION OF NOTES.           A shall be redeemable in whole upon receipt by the Trustee of a
                                 written demand (hereinafter called a "Redemption Demand") from the
                                 Note Indenture Trustee stating that there has occurred under the Note
                                 Indenture both an Event of Default and a declaration of acceleration
                                 of payment of principal, accrued interest and premium, if any, on the
                                 Notes, specifying the last date to which interest on the Notes has
                                 been paid (such date being hereinafter referred to as the "Initial
                                 Interest Accrual Date") and demanding redemption of the bonds of said
                                 series. The Trustee

                                 shall, within five (5) days after receiving such Redemption Demand,
                                 mail a copy thereof to the Company marked to indicate the date of its
                                 receipt by the Trustee. Promptly upon receipt by the Company of such
                                 copy of a Redemption Demand, the Company shall fix a date on which it
                                 will redeem the bonds of said series so demanded to be redeemed
                                 (hereinafter called the "Demand Redemption Date"). Notice of the date
                                 fixed as the Demand Redemption Date shall be mailed by the Company to
                                 the Trustee at least ten (10) days prior to such Demand Redemption
                                 Date. The date to be fixed by the Company as and for the Demand
                                 Redemption Date may be any date up to and including the earlier of
                                 (x) the 60th day after receipt by the Trustee of the Redemption
                                 Demand or (y) the maturity date of such bonds first occurring
                                 following the 20th day after the receipt by the Trustee of the
                                 Redemption Demand; provided, however, that if the Trustee shall not
                                 have received such notice fixing the Demand Redemption Date on or
                                 before the 10th day preceding the earlier of such dates, the Demand
                                 Redemption Date shall be deemed to be the earlier of such dates. The
                                 Trustee shall mail notice of the Demand Redemption Date (such notice
                                 being hereinafter called the "Demand Redemption Notice") to the Note
                                 Indenture Trustee not more than ten (10) nor less than five (5) days
                                 prior to the Demand Redemption Date.

                                 Each bond of 2006 Series A shall be redeemed by the Company on the
                                 Demand Redemption Date therefor upon surrender thereof by the Note
                                 Indenture Trustee to the Trustee at a redemption price equal to the
                                 principal amount thereof plus accrued interest thereon at the rate
                                 specified for such bond from the Initial Interest Accrual Date to the
                                 Demand Redemption Date plus an amount equal to the aggregate premium,
                                 if any, due and payable on such Demand Redemption Date on all Notes;
                                 provided, however, that in the event of a receipt by the Trustee of a
                                 notice that, pursuant to Section 602 of the Note Indenture, the Note
                                 Indenture Trustee has terminated proceedings to enforce any right
                                 under the Note Indenture, then any Redemption Demand shall thereby be
                                 rescinded by the Note Indenture Trustee, and no Demand Redemption
                                 Notice shall be given, or, if already given, shall be automatically
                                 annulled; but no such rescission or annulment shall extend to or
                                 affect any subsequent default or impair any right consequent thereon.

                                 Anything herein contained to the contrary notwithstanding, the
                                 Trustee is not authorized to take any action pursuant to a Redemption
                                 Demand and such Redemption Demand shall be of no force or effect,
                                 unless it is executed in the name of the Note Indenture Trustee by
                                 its President or one of its Vice Presidents.

FORM OF BONDS OF 2006            SECTION 5. The bonds of 2006 Series A (including the reverse thereof)
SERIES A.                        and the form of Trustee's Certificate to be endorsed on such bonds
                                 shall be substantially in the following forms, respectively:

                                                       THE DETROIT EDISON COMPANY
                                                  GENERAL AND REFUNDING MORTGAGE BOND
                                                             2006 SERIES A

                                 Notwithstanding any provisions hereof or in the Indenture, this bond
                                 is not assignable or transferable except as may be required to effect
                                 a transfer to any successor trustee under the Collateral Trust
                                 Indenture, dated as of June 30, 1993, as amended, and as further
                                 supplemented as of May 15, 2006, between

The Detroit Edison Company and J.P. Morgan Trust Company, National
Association, as Note Indenture Trustee, or, subject to compliance
with applicable law, as may be involved in the course of the exercise
of rights and remedies consequent upon an Event of Default under said
Indenture.

$______________                                       No. R-_________

THE DETROIT EDISON COMPANY (hereinafter called the "Company"), a
corporation of the State of Michigan, for value received, hereby
promises to pay to J.P. Morgan Trust Company, National Association,
as Note Indenture Trustee, or registered assigns, at the Company's
office or agency in the Borough of Manhattan, the City and State of
New York, the principal sum of ________ Dollars ($_______) in lawful
money of the United States of America on June 1, 2036 (subject to
earlier redemption or release) and interest thereon at the rate of
6.625% per annum, in like lawful money, from May 24, 2006, and after
the first payment of interest on bonds of this Series has been made
or otherwise provided for, from the most recent date to which
interest has been paid or otherwise provided for, semi-annually on
June 1 and December 1 of each year (commencing December 1, 2006),
until the Company's obligation with respect to payment of said
principal shall have been discharged, all as provided, to the extent
and in the manner specified in the Indenture hereinafter mentioned
and in the supplemental indenture pursuant to which this bond has
been issued.

Under a Collateral Trust Indenture, dated as of June 30, 1993, as
amended and as further supplemented as of May 15, 2006 (hereinafter
called the "Note Indenture"), between the Company and J.P. Morgan
Trust Company, National Association, as successor trustee
(hereinafter called the "Note Indenture Trustee"), the Company has
issued its 2006 Series A 6.625% Senior Notes due 2036 (the "Notes").
This bond was originally issued to the Note Indenture Trustee so as
to secure the payment of the Notes. Payments of principal of, or
premium, if any, or interest on, the Notes shall constitute like
payments on this bond as further provided herein and in the
supplemental indenture pursuant to which this bond has been issued.

Reference is hereby made to such further provisions of this bond set
forth on the reverse hereof and such provisions shall for all
purposes have the same effect as though set forth in this place.

This bond shall not be valid or become obligatory for any purpose
until J.P. Morgan Trust Company, National Association, the Trustee
under the Indenture, or its successor thereunder, shall have signed
the form of certificate endorsed hereon.

IN WITNESS WHEREOF, THE DETROIT EDISON COMPANY has caused this
instrument to be executed by an authorized officer, with his or her
manual or facsimile signatures, and its corporate seal, or a
facsimile thereof, to be impressed or imprinted hereon and the same
to be attested by its Corporate Secretary or Assistant Corporate
Secretary by manual or facsimile signature.

                                 Dated:
                                        ------------

                                                                    THE DETROIT EDISON COMPANY


                                                                    By:
                                                                        ------------------------------
                                                                    Name:
                                                                          ----------------------------
                                                                    Title:
                                                                           ---------------------------


                                 [Corporate Seal]

                                 Attest:


                                 By:
                                     ----------------------------
                                 Name:
                                       --------------------------
                                 Title:
                                        -------------------------

                                                    [FORM OF TRUSTEE'S CERTIFICATE]

FORM OF TRUSTEE'S                This bond is one of the bonds, of the series designated therein,
CERTIFICATE.                     described in the within-mentioned Indenture.

                                                                    J.P. MORGAN TRUST COMPANY,
                                                                    NATIONAL ASSOCIATION, as Trustee


                                                                    By:
                                                                        ------------------------------
                                                                        Authorized Officer

                                                       [FORM OF REVERSE OF BOND]

FORM OF REVERSE OF BOND          This bond is one of an authorized issue of bonds of the Company,
                                 unlimited as to amount except as provided in the Indenture
                                 hereinafter mentioned or any indentures supplemental thereto, and is
                                 one of a series of General and Refunding Mortgage Bonds known as 2006
                                 Series A, limited to an aggregate principal amount of $250,000,000,
                                 except as otherwise provided in the Indenture hereinafter mentioned.
                                 This bond and all other bonds of said series are issued and to be
                                 issued under, and are all equally and ratably secured (except insofar
                                 as any sinking, amortization, improvement or analogous fund,
                                 established in accordance with the provisions of the Indenture
                                 hereinafter mentioned, may afford additional security for the bonds
                                 of any particular series and except as provided in Section 3 of
                                 Article VI of said Indenture) by an Indenture, dated as of October 1,
                                 1924, duly executed by the Company to J.P. Morgan Trust Company,
                                 National Association, as successor Trustee, to which Indenture and
                                 all indentures supplemental thereto (including the Supplemental
                                 Indenture dated as of May 15, 2006) reference is hereby made for a
                                 description of the properties and franchises mortgaged and conveyed,
                                 the nature and extent of the security, the terms and conditions upon
                                 which the bonds are issued and under which additional bonds may be
                                 issued, and the rights of the holders of the bonds and of the Trustee
                                 in respect of such security (which Indenture and all indentures
                                 supplemental thereto, including the Supplemental Indenture dated as
                                 of May 15, 2006, are hereinafter collectively called the
                                 "Indenture").

As provided in the Indenture, said bonds may be for various principal
sums and are issuable in series, which may mature at different times,
may bear interest at different rates and may otherwise vary as in
said Indenture provided. With the consent of the Company and to the
extent permitted by and as provided in the Indenture, the rights and
obligations of the Company and of the holders of the bonds and the
terms and provisions of the Indenture, or of any indenture
supplemental thereto, may be modified or altered in certain respects
by affirmative vote of at least eighty-five percent (85%) in amount
of the bonds then outstanding, and, if the rights of one or more, but
less than all, series of bonds then outstanding are to be affected by
the action proposed to be taken, then also by affirmative vote of at
least eighty-five percent (85%) in amount of the series of bonds so
to be affected (excluding in every instance bonds disqualified from
voting by reason of the Company's interest therein as specified in
the Indenture); provided, however, that, without the consent of the
holder hereof, no such modification or alteration shall, among other
things, affect the terms of payment of the principal of or the
interest on this bond, which in those respects is unconditional.

This bond is redeemable prior to the Release Date upon the terms and
conditions set forth in the Indenture, including provision for
redemption upon demand of the Note Indenture Trustee following the
occurrence of an Event of Default under the Note Indenture and the
acceleration of the principal of the Notes.

Under the Indenture, funds may be deposited with the Trustee (which
shall have become available for payment), in advance of the
redemption date of any of the bonds of 2006 Series A (or portions
thereof), in trust for the redemption of such bonds (or portions
thereof) and the interest due or to become due thereon, and thereupon
all obligations of the Company in respect of such bonds (or portions
thereof) so to be redeemed and such interest shall cease and be
discharged, and the holders thereof shall thereafter be restricted
exclusively to such funds for any and all claims of whatsoever nature
on their part under the Indenture or with respect to such bonds (or
portions thereof) and interest.

In case an event of default, as defined in the Indenture, shall
occur, the principal of all the bonds issued thereunder may become or
be declared due and payable, in the manner, with the effect and
subject to the conditions provided in the Indenture.

Upon payment of the principal of, or premium, if any, or interest on,
the Notes, whether at maturity or prior to maturity by redemption or
otherwise or upon provision for the payment thereof having been made
in accordance with Article V of the Note Indenture, bonds of 2006
Series A in a principal amount equal to the principal amount of such
Notes, and having both a corresponding maturity date and interest
rate shall, to the extent of such payment of principal, premium or
interest, be deemed fully paid and the obligation of the Company
thereunder to make such payment shall forthwith cease and be
discharged, and, in the case of the payment of principal and premium,
if any, such bonds of said series shall be surrendered for
cancellation or presented for appropriate notation to the Trustee.

This bond is not assignable or transferable except as set forth under
Section 405 of the Note Indenture or in the supplemental indenture
relating to the

                                 Notes, or, subject to compliance with applicable law, as may be
                                 involved in the course of the exercise of rights and remedies
                                 consequent upon an Event of Default under the Note Indenture. Any
                                 such transfer shall be made by the registered holder hereof, in
                                 person or by his attorney duly authorized in writing, on the books of
                                 the Company kept at its office or agency in the Borough of Manhattan,
                                 the City and State of New York, upon surrender and cancellation of
                                 this bond, and thereupon, a new registered bond of the same series of
                                 authorized denominations for a like aggregate principal amount will
                                 be issued to the transferee in exchange therefor, and this bond with
                                 others in like form may in like manner be exchanged for one or more
                                 new bonds of the same series of other authorized denominations, but
                                 of the same aggregate principal amount, all as provided and upon the
                                 terms and conditions set forth in the Indenture, and upon payment, in
                                 any event, of the charges prescribed in the Indenture.

                                 From and after the Release Date (as defined in the Note Indenture),
                                 the bonds of 2006 Series A shall be deemed fully paid, satisfied and
                                 discharged and the obligation of the Company thereunder shall be
                                 terminated. On the Release Date, the bonds of 2006 Series A shall be
                                 surrendered to and cancelled by the Trustee. The Company covenants
                                 and agrees that, prior to the Release Date, it will not take any
                                 action that would cause the outstanding principal amount of the bond
                                 of 2006 Series A to be less than the then outstanding principal
                                 amount of the Notes.

                                 No recourse shall be had for the payment of the principal of or the
                                 interest on this bond, or for any claim based hereon or otherwise in
                                 respect hereof or of the Indenture, or of any indenture supplemental
                                 thereto, against any incorporator, or against any past, present or
                                 future stockholder, director or officer, as such, of the Company, or
                                 of any predecessor or successor corporation, either directly or
                                 through the Company or any such predecessor or successor corporation,
                                 whether for amounts unpaid on stock subscriptions or by virtue of any
                                 constitution, statute or rule of law, or by the enforcement of any
                                 assessment or penalty or otherwise howsoever; all such liability
                                 being, by the acceptance hereof and as part of the consideration for
                                 the issue hereof, expressly waived and released by every holder or
                                 owner hereof, as more fully provided in the Indenture.

                                                                PART II.

                                                       RECORDING AND FILING DATA

RECORDING AND FILING OF          The Original Indenture and indentures supplemental thereto have been
ORIGINAL INDENTURE.              recorded and/or filed and Certificates of Provision for Payment have
                                 been recorded as hereinafter set forth.

                                 The Original Indenture has been recorded as a real estate mortgage
                                 and filed as a chattel Mortgage in the offices of the respective
                                 Registers of Deeds of certain counties in the State of Michigan as
                                 set forth in the Supplemental Indenture dated as of September 1,
                                 1947, has been recorded as a real estate mortgage in the office of
                                 the Register of Deeds of Genesee County, Michigan as set forth in the
                                 Supplemental Indenture dated as of May 1, 1974, has been filed in the
                                 Office of the Secretary of State of Michigan on November 16, 1951 and
                                 has been filed and recorded in the office of the Interstate Commerce
                                 Commission

                                 on December 8, 1969.

RECORDING AND FILING OF          Pursuant to the terms and provisions of the Original Indenture,
SUPPLEMENTAL INDENTURES.         indentures supplemental thereto heretofore entered into have been
                                 Recorded as a real estate mortgage and/or filed as a chattel mortgage
                                 or as a financing statement in the offices of the respective
                                 Registers of Deeds of certain counties in the State of Michigan, the
                                 Office of the Secretary of State of Michigan and the Office of the
                                 Interstate Commerce Commission or the Surface Transportation Board,
                                 as set forth in supplemental indentures as follows:

                                                                     RECORDED AND/OR FILED
                                                                        AS SET FORTH IN
    SUPPLEMENTAL INDENTURE            PURPOSE OF SUPPLEMENTAL             SUPPLEMENTAL
          DATED AS OF                        INDENTURE               INDENTURE DATED AS OF
------------------------------   ---------------------------------   ---------------------
June 1, 1925(a)(b)............   Series B Bonds                      February 1, 1940
August 1, 1927(a)(b)..........   Series C Bonds                      February 1, 1940
February 1, 1931(a)(b)........   Series D Bonds                      February 1, 1940
June 1, 1931(a)(b)............   Subject Properties                  February 1, 1940
October 1, 1932(a)(b).........   Series E Bonds                      February 1, 1940
September 25, 1935(a)(b)......   Series F Bonds                      February 1, 1940
September 1, 1936(a)(b).......   Series G Bonds                      February 1, 1940
November 1, 1936(a)(b)........   Subject Properties                  February 1, 1940
February 1, 1940(a)(b)........   Subject Properties                  September 1, 1947
December 1, 1940(a)(b)........   Series H Bonds and Additional       September 1, 1947
                                 Provisions
September 1, 1947(a)(b)(c)....   Series I Bonds, Subject             November 15, 1951
                                 Properties and Additional
                                 Provisions
March 1, 1950(a)(b)(c)........   Series J Bonds and Additional       November 15, 1951
                                 Provisions
November 15, 1951(a)(b)(c)....   Series K Bonds, Additional          January 15, 1953
                                 Provisions and Subject Properties
January 15, 1953(a)(b)........   Series L Bonds                      May 1, 1953
May 1, 1953(a)................   Series M Bonds and Subject          March 15, 1954
                                 Properties
March 15, 1954(a)(c)..........   Series N Bonds and Subject          May 15, 1955
                                 Properties
May 15, 1955(a)(c)............   Series O Bonds and Subject          August 15, 1957
                                 Properties
August 15, 1957(a)(c).........   Series P Bonds, Additional          June 1, 1959
                                 Provisions and Subject Properties
June 1, 1959(a)(c)............   Series Q Bonds and Subject          December 1, 1966
                                 Properties
December 1, 1966(a)(c)........   Series R Bonds, Additional          October 1, 1968
                                 Provisions and Subject Properties
October 1, 1968(a)(c).........   Series S Bonds and Subject          December 1, 1969
                                 Properties
December 1, 1969(a)(c)........   Series T Bonds and Subject          July 1, 1970
                                 Properties

RECORDED AND/OR FILED
AS SET FORTH IN
SUPPLEMENTAL INDENTURE PURPOSE OF SUPPLEMENTAL SUPPLEMENTAL
DATED AS OF INDENTURE INDENTURE DATED AS OF
------------------------------ --------------------------------- ---------------------
July 1, 1970(c)............... Series U Bonds and Subject December 15, 1970
Properties
December 15, 1970(c).......... Series V and Series W Bonds June 15, 1971
June 15, 1971(c).............. Series X Bonds and Subject November 15, 1971
Properties
November 15, 1971(c).......... Series Y Bonds and Subject January 15, 1973
Properties
January 15, 1973(c)........... Series Z Bonds and Subject May 1, 1974
Properties
May 1, 1974................... Series AA Bonds and Subject October 1, 1974
Properties
October 1, 1974............... Series BB Bonds and Subject January 15, 1975
Properties
January 15, 1975.............. Series CC Bonds and Subject November 1, 1975
Properties
November 1, 1975.............. Series DDP Nos. 1-9 Bonds and December 15, 1975
Subject Properties
December 15, 1975............. Series EE Bonds and Subject February 1, 1976
Properties
February 1, 1976.............. Series FFR Nos. 1-13 Bonds June 15, 1976
June 15, 1976................. Series GGP Nos. 1-7 Bonds and July 15, 1976
Subject Properties
July 15, 1976................. Series HH Bonds and Subject February 15, 1977
Properties
February 15, 1977............. Series MMP Bonds and Subject March 1, 1977
Properties
March 1, 1977................. Series IIP Nos. 1-7 Bonds, Series June 15, 1977
JJP Nos. 1-7 Bonds, Series KKP
Nos. 1-7 Bonds and Series LLP
Nos. 1-7 Bonds
June 15, 1977................. Series FFR No. 14 Bonds and July 1, 1977
Subject Properties
July 1, 1977.................. Series NNP Nos. 1-7 Bonds and October 1, 1977
Subject Properties
October 1, 1977............... Series GGP Nos. 8-22 Bonds and June 1, 1978
Series OOP Nos. 1-17 Bonds and
Subject Properties
June 1, 1978.................. Series PP Bonds, Series QQP Nos. October 15, 1978
1-9 Bonds and Subject Properties
October 15, 1978.............. Series RR Bonds and Subject March 15, 1979
Properties
March 15, 1979................ Series SS Bonds and Subject July 1, 1979
Properties

                                                                     RECORDED AND/OR FILED
                                                                        AS SET FORTH IN
    SUPPLEMENTAL INDENTURE            PURPOSE OF SUPPLEMENTAL             SUPPLEMENTAL
          DATED AS OF                        INDENTURE               INDENTURE DATED AS OF
------------------------------   ---------------------------------   ---------------------
July 1, 1979..................   Series IIP Nos. 8-22 Bonds,         September 1, 1979
                                 Series NNP Nos. 8-21 Bonds and
                                 Series TTP Nos. 1-15 Bonds and
                                 Subject Properties
September 1, 1979.............   Series JJP No. 8 Bonds, Series      September 15, 1979
                                 KKP No. 8 Bonds, Series LLP Nos.
                                 8-15 Bonds, Series MMP No. 2
                                 Bonds and Series OOP No. 18 Bonds
                                 and Subject Properties
September 15, 1979............   Series UU Bonds                     January 1, 1980
January 1, 1980...............   1980 Series A Bonds and Subject     April 1, 1980
                                 Properties
April 1, 1980.................   1980 Series B Bonds                 August 15, 1980
August 15, 1980...............   Series QQP Nos. 10-19 Bonds, 1980   August 1, 1981
                                 Series CP Nos. 1-12 Bonds and
                                 1980 Series DP No. 1-11 Bonds and
                                 Subject Properties
August 1, 1981................   1980 Series CP Nos. 13-25 Bonds     November 1, 1981
                                 and Subject Properties
November 1, 1981..............   1981 Series AP Nos. 1-12 Bonds      June 30, 1982
June 30, 1982.................   Article XIV Reconfirmation          August 15, 1982
August 15, 1982...............   1981 Series AP Nos. 13-14 Bonds     June 1, 1983
                                 and Subject Properties
June 1, 1983..................   1981 Series AP Nos. 15-16 Bonds     October 1, 1984
                                 and Subject Properties
October 1, 1984...............   1984 Series AP Bonds and 1984       May 1, 1985
                                 Series BP Bonds and Subject
                                 Properties
May 1, 1985...................   1985 Series A Bonds                 May 15, 1985
May 15, 1985..................   1985 Series B Bonds and Subject     October 15, 1985
                                 Properties
October 15, 1985..............   Series KKP No. 9 Bonds and          April 1, 1986
                                 Subject Properties
April 1, 1986.................   1986 Series A Bonds and Subject     August 15, 1986
                                 Properties
August 15, 1986...............   1986 Series B Bonds and Subject     November 30, 1986
                                 Properties
November 30, 1986.............   1986 Series C Bonds                 January 31, 1987
January 31, 1987..............   1987 Series A Bonds                 April 1, 1987
April 1, 1987.................   1987 Series B Bonds and 1987        August 15, 1987
                                 Series C Bonds
August 15, 1987...............   1987 Series D Bonds, 1987 Series    November 30, 1987
                                 E Bonds and Subject Properties
November 30, 1987.............   1987 Series F Bonds                 June 15, 1989

                                                                     RECORDED AND/OR FILED
                                                                        AS SET FORTH IN
    SUPPLEMENTAL INDENTURE            PURPOSE OF SUPPLEMENTAL             SUPPLEMENTAL
          DATED AS OF                        INDENTURE               INDENTURE DATED AS OF
------------------------------   ---------------------------------   ---------------------
June 15, 1989.................   1989 Series A Bonds                 July 15, 1989
July 15, 1989.................   Series KKP No. 10 Bonds             December 1, 1989
December 1, 1989..............   Series KKP No. 11 Bonds and 1989    February 15, 1990
                                 Series BP Bonds
February 15, 1990.............   1990 Series A Bonds, 1990 Series    November 1, 1990
                                 B Bonds, 1990 Series C Bonds,
                                 1990 Series D Bonds, 1990 Series
                                 E Bonds and 1990 Series F Bonds
November 1, 1990..............   Series KKP No. 12 Bonds             April 1, 1991
April 1, 1991.................   1991 Series AP Bonds                May 1, 1991
May 1, 1991...................   1991 Series BP Bonds and 1991       May 15, 1991
                                 Series CP Bonds
May 15, 1991..................   1991 Series DP Bonds                September 1, 1991
September 1, 1991.............   1991 Series EP Bonds                November 1, 1991
November 1, 1991..............   1991 Series FP Bonds                January 15, 1992
January 15, 1992..............   1992 Series BP Bonds                February 29, 1992
                                                                     and April 15, 1992
February 29, 1992.............   1992 Series AP Bonds                April 15, 1992
April 15, 1992................   Series KKP No. 13 Bonds             July 15, 1992
July 15, 1992.................   1992 Series CP Bonds                November 30, 1992
July 31, 1992.................   1992 Series D Bonds                 November 30, 1992
November 30, 1992.............   1992 Series E Bonds and 1993        March 15, 1993
                                 Series D Bonds
December 15, 1992.............   Series KKP No. 14 Bonds and 1989    March 15, 1993
                                 Series BP No. 2 Bonds
January 1, 1993...............   1993 Series C Bonds                 April 1, 1993
March 1, 1993.................   1993 Series E Bonds                 June 30, 1993
March 15, 1993................   1993 Series D Bonds                 September 15, 1993
April 1, 1993.................   1993 Series FP Bonds and 1993       September 15, 1993
                                 Series IP Bonds
April 26, 1993................   1993 Series G  Bonds and            September 15, 1993
                                 Amendment of Article II, Section
                                 5
May 31, 1993..................   1993 Series J Bonds                 September 15, 1993
June 30, 1993.................   1993 Series AP Bonds                        (d)
September 15, 1993............   1993 Series K Bonds                 March 1, 1994
March 1, 1994.................   1994 Series AP Bonds                June 15, 1994
June 15, 1994.................   1994 Series BP Bonds                December 1, 1994
August 15, 1994...............   1994 Series C Bonds                 December 1, 1994
December 1, 1994..............   Series KKP No. 15 Bonds and 1994    August 1, 1995
                                 Series DP Bonds
August 1, 1995................   1995 Series AP Bonds and 1995       August 1, 1999
                                 Series BP Bonds

                                                                     RECORDED AND/OR FILED
                                                                        AS SET FORTH IN
    SUPPLEMENTAL INDENTURE            PURPOSE OF SUPPLEMENTAL             SUPPLEMENTAL
          DATED AS OF                        INDENTURE               INDENTURE DATED AS OF
------------------------------   ---------------------------------   ---------------------
August 1, 1999................   1999 Series AP Bonds, 1999 Series           (d)
                                 BP Bonds and 1999 Series CP Bonds
August 15, 1999...............   1999 Series D Bonds                         (d)
January 1, 2000...............   2000 Series A Bonds                         (d)
April 15, 2000................   Appointment of Successor Trustee            (d)
August 1, 2000................   2000 Series BP Bonds                        (d)
March 15, 2001................   2001 Series AP Bonds                        (d)
May 1, 2001...................   2001 Series BP Bonds                        (d)
August 15, 2001...............   2001 Series CP Bonds                        (d)
September 15, 2001............   2001 Series D Bonds and 2001                (d)
                                 Series E Bonds
September 17, 2002............   Amendment of Article XIII,                  (d)
                                 Section 3 and Appointment of
                                 Successor Trustee
October 15, 2002..............   2002 Series A Bonds and 2002                (d)
                                 Series B Bonds
December 1, 2002 .............   2002 Series C Bonds and 2002                (d)
                                 Series D Bonds
August 1, 2003................   2003 Series A Bonds                         (d)
March 15, 2004................   2004 Series A Bonds and 2004                (d)
                                 Series B Bonds
July 1, 2004 .................   2004 Series D Bonds                         (d)
February 1, 2005..............   2005 Series A Bonds and 2005        May 15, 2006
                                 Series B Bonds
April 1, 2005 ................   2005 Series AR Bonds and 2005       May 15, 2006
                                 Series BR Bonds
August 1, 2005................   2005 Series DT Bonds                May 15, 2006
September 15, 2005............   2005 Series C Bonds                 May 15, 2006
September 30, 2005............   2005 Series E Bonds                 May 15, 2006

(a)  See Supplemental Indenture dated as of July 1, 1970 for Interstate Commerce
     Commission filing and recordation information.

(b)  See Supplemental Indenture dated as of May 1, 1953 for Secretary of State
     of Michigan filing information.

(c)  See Supplemental Indenture dated as of May 1, 1974 for County of Genesee,
     Michigan recording and filing information.

(d)  Recording and filing information for this Supplemental Indenture has not
     been set forth in a subsequent Supplemental Indenture.

RECORDING AND FILING OF          Further, pursuant to the terms and provisions of the Original
SUPPLEMENTAL INDENTURE DATED     Indenture, a Supplemental Indenture dated as of February 1, 2005
AS OF FEBRUARY 1, 2005.          providing for the terms of bonds to be issued thereunder of 2005
                                 Series A and 2005 Series B has heretofore been entered into between
                                 the Company and the Trustee and has been filed in the Office of the
                                 Secretary of State of Michigan as a financing statement on February
                                 23, 2005 (Filing No. 2005036247-6), has been filed and recorded in
                                 the Office of the Surface Transportation Board (Recordation No.
                                 5485-HHHHH) on February 18, 2005, and has been recorded as a real
                                 estate mortgage in the offices of the respective Register of Deeds of
                                 certain counties in the State of Michigan, as follows:

                                                 LIBER/
COUNTY                           RECORDED    INSTRUMENT NO.   PAGE
------                           --------   ---------------   ----
Genesee.......................    2/15/05   200502150014717   N/A
Huron.........................    2/7/05    1093              705
Ingham........................    2/8/05    3150              1158
Lapeer........................    2/7/05    2006              706
Lenawee.......................    2/7/05    2290              824
Livingston....................    2/7/05    4709              0741
Macomb........................    2/11/05   16388             602
Mason.........................    2/7/05    569               621
Monroe........................    2/7/05    2873              984
Oakland.......................    2/4/05    34917             695
St. Clair.....................    2/7/05    3277              142
Sanilac.......................    2/8/05    874               384
Tuscola.......................    2/9/05    1027              90
Washtenaw.....................    2/9/05    4457              272
Wayne.........................    2/8/05    42154             235

RECORDING AND FILING OF          Further, pursuant to the terms and provisions of the Original
SUPPLEMENTAL INDENTURE DATED     Indenture, a Supplemental Indenture dated as of April 1, 2005
AS OF APRIL 1, 2005.             providing for the terms of bonds to be issued thereunder of 2005
                                 Series AR and 2005 Series BR has heretofore been entered into between
                                 the Company and the Trustee and has been filed in the Office of the
                                 Secretary of State of Michigan as a financing statement on August 24,
                                 2005 (Filing No. 2005150387-1), has been filed and recorded in the
                                 Office of the Surface Transportation Board (Recordation No.
                                 5485-JJJJJ) on August 25, 2005, and has been recorded as a real
                                 estate mortgage in the offices of the respective Register of Deeds of
                                 certain counties in the State of Michigan, as follows:

                                                 LIBER/
COUNTY                           RECORDED    INSTRUMENT NO.   PAGE
------                           --------   ---------------   ----
Genesee.......................    8/25/05   200508250084654   N/A
Huron.........................    8/24/05   1124              49
Ingham........................    8/25/05   3180              922
Lapeer........................    8/24/05   2080              76
Lenawee.......................    8/24/05   2305              409
Livingston....................    8/25/04   4895              0143

                                                 LIBER/
COUNTY                           RECORDED    INSTRUMENT NO.   PAGE
------                           --------   ---------------   ----
Macomb........................    8/25/04   17066             16
Mason.........................    8/24/05   575               2628
Monroe........................    8/24/05   2979              486
Oakland.......................    9/2/05    36190             577
St. Clair.....................    8/24/05   3407              881
Sanilac.......................    8/24/05   907               755
Tuscola.......................    8/24/05   1051              567
Washtenaw.....................    8/29/05   4503              622
Wayne.........................    8/31/05   43403             121

RECORDING AND FILING OF          Further, pursuant to the terms and provisions of the Original
SUPPLEMENTAL INDENTURE DATED     Indenture, a Supplemental Indenture dated as of August 1, 2005
AS OF AUGUST 1, 2005.            providing for the terms of bonds to be issued thereunder of 2005
                                 Series DT has heretofore been entered into between the Company and
                                 the Trustee and has been filed in the Office of the Secretary of
                                 State of Michigan as a financing statement on August 17, 2005 (Filing
                                 No. 2005145795-9), has been filed and recorded in the Office of the
                                 Surface Transportation Board (Recordation No. 5485-IIIII) on August
                                 25, 2005, and has been recorded as a real estate mortgage in the
                                 offices of the respective Register of Deeds of certain counties in
                                 the State of Michigan, as follows:

                                                 LIBER/
COUNTY                           RECORDED    INSTRUMENT NO.   PAGE
------                           --------   ---------------   ----
Genesee.......................    8/18/05   200508180082264   N/A
Huron.........................    8/17/05   1122              653
Ingham........................    9/22/05   3184              1270
Lapeer........................    8/17/05   2078              71
Lenawee.......................    8/17/05   2304              759
Livingston....................    8/18/05   4887              0002
Macomb........................    8/18/05   17037             828
Mason.........................    8/17/05   575               1846
Monroe........................    8/17/05   2975              458
Oakland.......................    8/24/05   36134             92
St. Clair.....................    8/18/05   3403              549
Sanilac.......................    8/17/05   906               579
Tuscola.......................    8/17/05   1050              239
Washtenaw.....................    8/29/05   4503              636
Wayne.........................    8/19/05   43350             165

RECORDING AND FILING OF          Further, pursuant to the terms and provisions of the Original
SUPPLEMENTAL INDENTURE DATED     Indenture, a Supplemental Indenture dated as of September 15, 2005
AS OF SEPTEMBER 15, 2005.        providing for the terms of bonds to be issued thereunder of 2005
                                 Series C has heretofore been entered into between the Company and the
                                 Trustee and has been filed in the Office of the Secretary of State of
                                 Michigan as a financing statement on September 29, 2005 (Filing No.
                                 2005169429-2), has been filed and recorded in the Office of the
                                 Surface Transportation Board (Recordation No. 5485-KKKKK) on
                                 September 29, 2005, and has been recorded as a real estate mortgage
                                 in the offices of the respective Register of Deeds of certain
                                 counties in the State of

                                 Michigan, as follows:

                                                 LIBER/
COUNTY                           RECORDED    INSTRUMENT NO.   PAGE
------                           --------   ---------------   ----
Genesee.......................   9/30/05    200509300095549   N/A
Huron.........................   9/29/05    1129              521
Ingham........................   9/30/05    3186              309
Lapeer........................   9/29/05    2094              76
Lenawee.......................   9/29/05    2308              246
Livingston....................   9/29/05    930               302
Macomb........................   9/29/05    17188             216
Mason.........................   9/30/05    576               3299
Monroe........................   9/29/05    3001              159
Oakland.......................   10/13/05   36426             584
St. Clair.....................   9/30/05    3430              501
Sanilac.......................   9/29/05    913               786
Tuscola.......................   9/30/05    1056              70
Washtenaw.....................   9/29/05    4511              51
Wayne.........................   10/03/05   43568             1108

RECORDING AND FILING OF          Further, pursuant to the terms and provisions of the Original
SUPPLEMENTAL INDENTURE DATED     Indenture, a Supplemental Indenture dated as of September 30, 2005
AS OF SEPTEMBER 30, 2005.        providing for the terms of bonds to be issued thereunder of 2005
                                 Series E has heretofore been entered into between the Company and the
                                 Trustee and has been filed in the Office of the Secretary of State of
                                 Michigan as a financing statement on October 6, 2005 (Filing No.
                                 2005173984-4), has been filed and recorded in the Office of the
                                 Surface Transportation Board (Recordation No. 5485-LLLLL) on October
                                 6, 2005, and has been recorded as a real estate mortgage in the
                                 offices of the respective Register of Deeds of certain counties in
                                 the State of Michigan, as follows:

                                                 LIBER/
COUNTY                           RECORDED    INSTRUMENT NO.   PAGE
------                           --------   ---------------   ----
Genesee.......................   10/11/05   200510110098395   N/A
Huron.........................   10/06/05   1130              675
Ingham........................   10/07/05   3187              715
Lapeer........................   10/06/05   2096              939
Lenawee.......................   10/06/05   2308              768
Livingston....................   10/06/05   4936              708
Macomb........................   10/12/05   17217             556
Mason.........................   10/06/05   577               550
Monroe........................   10/06/05   3005              965
Oakland.......................   11/18/05   36639             627
St. Clair.....................   10/06/05   3434              360
Sanilac.......................   10/06/05   915               309
Tuscola.......................   10/10/05   1057              194
Washtenaw.....................   10/12/05   4513              747
Wayne.........................   10/11/05   43613             159

RECORDING OF CERTIFICATES OF All the bonds of Series A which were issued under the Original
PROVISION FOR PAYMENT. Indenture dated as of October 1, 1924, and of Series B, Series C,
Series D, Series E, Series F, Series G, Series H, Series I, Series J,
Series K, Series L, Series M, Series N, Series O, Series P, Series Q,
Series R, Series S, Series T, Series U, Series V, Series W, Series X,
Series Y, Series Z, Series AA, Series BB, Series CC, Series DDP Nos.
1-9, Series EE, Series FFR Nos. 1-13, Series GGP Nos. 1-7, Series HH,
Series MMP, Series IP Nos. 1-7, Series JJP Nos. 1-7, Series KKP Nos.
1-7, Series LLP Nos. 1-7, Series FFR No. 14, Series NNP Nos. 1-7,
Series GGP Nos. 8-22, Series OOP Nos. 1-17, Series PP, Series QQP
Nos. 1-9, Series RR, Series SS, Series IIP Nos. 8-22, Series NNP Nos.
8-21, Series TTP Nos. 1-15, Series JJP No. 8, Series KKP No. 8,
Series LLP Nos. 8-15, Series MMP No. 2, Series OOP No. 18, Series UU,
1980 Series A, 1980 Series B, Series QQP Nos. 10-19, 1980 Series CP
Nos. 1-12, 1980 Series DP Nos. 1-11, 1980 Series CP Nos. 13-25, 1981
Series AP Nos. 1-12, 1981 Series AP Nos. 13-14, 1981 Series AP Nos.
15-16, 1984 Series AP, 1984 Series BP, 1985 Series A, 1985 Series B,
Series KKP No. 9, 1986 Series A, 1986 Series B, 1986 Series C, 1987
Series A, 1987 Series B, 1987 Series C, 1987 Series D, 1987 Series E,
1987 Series F, 1989 Series A, Series KKP No. 10, Series KKP No. 11,
1989 Series BP, 1990 Series A, 1990 Series D, 1991 Series EP, 1991
Series FP, 1992 Series BP, Series KKP No. 13, 1992 Series CP, 1992
Series D, Series KKP No. 14, 1989 Series BP No. 2, 1993 Series B,
1993 Series C, 1993, 1993 Series H, 1993 Series E, 1993 Series D,
1993 Series FP, 1993 Series IP, 1993 Series G, 1993 Series J, 1993
Series K, 1994 Series AP, 1994 Series BP, 1994 Series C, Series KKP
No. 15, 1994 Series DP, 1995 Series AP, 1995 Series BP, 1999 Series
D, 2000 Series A, 2001 Series D, 2005 Series A, and 2005 Series B,
which were issued under Supplemental Indentures as described in the
Recording and Filing of Supplemental Indentures section above, have
matured or have been called for redemption and funds sufficient for
such payment or redemption have been irrevocably deposited with the
Trustee for that purpose; and Certificates of Provision for Payment
have been recorded in the offices of the respective Registers of
Deeds of certain counties in the State of Michigan, with respect to
all bonds of Series A, B, C, D, E, F, G, H, K, L, M, O, W, BB, CC,
DDP Nos. 1 and 2, FFR Nos. 1-3, GGP Nos. 1 and 2, IIP No. 1, JJP No.
1, KKP No. 1, LLP No. 1 and GGP No. 8.

PART III.

THE TRUSTEE.

TERMS AND CONDITIONS OF The Trustee hereby accepts the trust hereby declared and provided,
ACCEPTANCE OF TRUST BY and agrees to perform the same upon the terms and conditions in the
TRUSTEE. Original Indenture, as amended to date and as supplemented by this
Supplemental Indenture, and in this Supplemental Indenture set forth,
and upon the following terms and conditions:

The Trustee shall not be responsible in any manner whatsoever for and
in respect of the validity or sufficiency of this Supplemental
Indenture or the due execution hereof by the Company or for or in
respect of the recitals contained herein, all of which recitals are
made by the Company solely.

                                                                PART IV.

                                                             MISCELLANEOUS.

CONFIRMATION OF SECTION 318(c)   Except to the extent specifically provided therein, no provision of
OF TRUST INDENTURE ACT.          this Supplemental Indenture or any future supplemental indenture is
                                 intended to modify, and the parties do hereby adopt and confirm, the
                                 provisions of Section 318(c) of the Trust Indenture Act which amend
                                 and supersede provisions of the Indenture in effect prior to November
                                 15, 1990.

EXECUTION IN COUNTERPARTS.       THIS SUPPLEMENTAL INDENTURE MAY BE SIMULTANEOUSLY EXECUTED IN ANY
                                 NUMBER OF COUNTERPARTS, EACH OF WHICH WHEN SO EXECUTED SHALL BE
                                 DEEMED TO BE AN ORIGINAL; BUT SUCH COUNTERPARTS SHALL TOGETHER
                                 CONSTITUTE BUT ONE AND THE SAME INSTRUMENT.

TESTIMONIUM.                     IN WITNESS WHEREOF, THE DETROIT EDISON COMPANY AND J.P. MORGAN TRUST
                                 COMPANY, NATIONAL ASSOCIATION HAVE CAUSED THESE PRESENTS TO BE SIGNED
                                 IN THEIR RESPECTIVE CORPORATE NAMES BY THEIR RESPECTIVE CHAIRMEN OF
                                 THE BOARD, PRESIDENTS, VICE PRESIDENTS, ASSISTANT VICE PRESIDENTS,
                                 TREASURERS OR ASSISTANT TREASURERS AND IMPRESSED WITH THEIR
                                 RESPECTIVE CORPORATE SEALS, ATTESTED BY THEIR RESPECTIVE SECRETARIES
                                 OR ASSISTANT SECRETARIES, ALL AS OF THE DAY AND YEAR FIRST ABOVE
                                 WRITTEN.

EXECUTION BY COMPANY.                                               THE DETROIT EDISON COMPANY


                                                                    By: /s/ Paul A. Stadnikia
                                                                        ------------------------------
(Corporate Seal)                                                    Name: Paul A. Stadnikia
                                                                    Title: Assistant Treasurer


                                 Attest:


                                 By: /s/ Sandra Kay Ennis
                                     ----------------------------
                                 Name: Sandra Kay Ennis
                                 Title: Corporate Secretary


                                 Signed, sealed and delivered by
                                 THE DETROIT EDISON COMPANY
                                 in the presence of


                                 /s/ Jaileah X. Huddleston
                                 --------------------------------
                                 Name: Jaileah X. Huddleston


                                 /s/ Stephanie V. Washio
                                 --------------------------------
                                 Name: Stephanie V. Washio

                                 STATE OF MICHIGAN )
                                                   )SS
                                 COUNTY OF WAYNE   )

ACKNOWLEDGMENT OF                On this 23rd day of May 2006, before me, the subscriber, a Notary
EXECUTION BY COMPANY.            Public within and for the County of Macomb, in the State of Michigan,
                                 acting in the County of Wayne, personally appeared Paul A. Stadnikia,
                                 to me personally known, who, being by me duly sworn, did say that he
                                 does business at 2000 2nd Avenue, Detroit, Michigan 48226 and is the
                                 Assistant Treasurer of THE DETROIT EDISON COMPANY, one of the
                                 corporations described in and which executed the foregoing
                                 instrument; that he knows the corporate seal of the said corporation
                                 and that the seal affixed to said instrument is the corporate seal of
                                 said corporation; and that said instrument was signed and sealed in
                                 behalf of said corporation by authority of its Board of Directors and
                                 that he subscribed his name thereto by like authority; and said Paul
                                 A. Stadnikia acknowledged said instrument to be the free act and deed
                                 of said corporation.


(Notarial Seal)                  /s/ Nancy Jo Wilk-Stasyk
                                 -------------------------------------
                                 Nancy Jo Wilk-Stasyk, Notary Public
                                 County of Macomb, State of Michigan
                                 My Commission Expires: March 19, 2011
                                 Acting in County of Wayne

EXECUTION BY TRUSTEE.                                               J.P. MORGAN TRUST COMPANY,
                                                                    NATIONAL ASSOCIATION


                                                                    By: /s/ J. Michael Banas
                                                                        ------------------------------
(Corporate Seal)                                                    Name: J. Michael Banas
                                                                    Title: Vice President


                                 Attest:


                                 By: /s/ Alexis M. Johnson
                                     ----------------------------
                                 Name: Alexis M. Johnson
                                 Title: Authorized Officer


                                 Signed, sealed and delivered by
                                 J.P. MORGAN TRUST COMPANY,
                                 NATIONAL ASSOCIATION
                                 in the presence of


                                 /s/ Corinne R. Galusky
                                 --------------------------------
                                 Name: Corinne R. Galusky


                                 /s/ Timothy J. Maloche
                                 --------------------------------
                                 Name: Timothy J. Maloche

                                 STATE OF MICHIGAN )
                                                   )SS
                                 COUNTY OF WAYNE   )

ACKNOWLEDGMENT OF                On this 23rd day of May 2006, before me, the subscriber, a Notary
EXECUTION BY TRUSTEE.            Public within and for the County of Macomb, in the State of Michigan,
                                 acting in the County of Wayne, personally appeared J. Michael Banas,
                                 to me personally known, who, being by me duly sworn, did say that his
                                 business office is located at 611 Woodward Avenue, Detroit, Michigan
                                 48226, and he is Vice President of J.P. MORGAN TRUST COMPANY,
                                 NATIONAL ASSOCIATION, one of the corporations described in and which
                                 executed the foregoing instrument; that he knows the corporate seal
                                 of the said corporation and that the seal affixed to said instrument
                                 is the corporate seal of said corporation; and that said instrument
                                 was signed and sealed in behalf of said corporation by authority of
                                 its Board of Directors and that he subscribed his name thereto by
                                 like authority; and said J. Michael Banas acknowledged said
                                 instrument to be the free act and deed of said corporation.


(Notarial Seal)                  /s/ Nancy Jo Wilk-Stasyk
                                 -------------------------------------
                                 Nancy Jo Wilk-Stasyk, Notary Public
                                 County of Macomb, State of Michigan
                                 My Commission Expires: March 19, 2011
                                 Acting in County of Wayne

                                 STATE OF MICHIGAN )
                                                   )SS
                                 COUNTY OF WAYNE   )

AFFIDAVIT AS TO CONSIDERATION    Paul A. Stadnikia, being duly sworn, says: that he is the Assistant
AND GOOD FAITH.                  Treasurer of THE DETROIT EDISON COMPANY, the Mortgagor named in the
                                 foregoing instrument, and that he has knowledge of the facts in
                                 regard to the making of said instrument and of the consideration
                                 therefor; that the consideration for said instrument was and is
                                 actual and adequate, and that the same was given in good faith for
                                 the purposes in such instrument set forth.


                                 /s/ Paul A. Stadnikia
                                 --------------------------------
                                 Name: Paul A. Stadnikia
                                 Title: Assistant Treasurer
                                 The Detroit Edison Company


                                 Sworn to before me this 23rd
                                 day of May 2006


(Notarial Seal)                  /s/ Nancy Jo Wilk-Stasyk
                                 -------------------------------------
                                 Nancy Jo Wilk-Stasyk, Notary Public
                                 County of Macomb, State of Michigan
                                 My Commission Expires: March 19, 2011
                                 Acting in County of Wayne

This instrument was drafted by:

Jaileah X. Huddleston, Esq.
2000 2nd Avenue
688 WCB
Detroit, Michigan 48226

When recorded return to:
Stephanie V. Washio
2000 2nd Avenue
688 WCB
Detroit, Michigan 48226

EXHIBIT 12-25

THE DETROIT EDISON COMPANY
COMPUTATION OF RATIOS OF EARNINGS TO FIXED CHARGES


	Six Months
	Ended June 30		Twelve Months Ended December 31
	2006		2005		2004		2003		2002		2001
(Millions of Dollars)
Earnings:
Pretax earnings	$	171	$	426	$	214	$	397	$	534	$	320
Fixed charges		156		280		294		294		322		314

Net earnings	$	327	$	706	$	508	$	691	$	856	$	634


Fixed charges:
Interest expense	$	148	$	267	$	280	$	284	$	319	$	306
Adjustments		8		13		14		10		3		8

Fixed charges	$	156	$	280	$	294	$	294	$	322	$	314


Ratios of earnings to fixed charges		2.10		2.52		1.73		2.35		2.66		2.02

Exhibit 31-25

SECTION 302 CERTIFICATION

I, Anthony F. Earley, Jr., certify that:

	1.		I have reviewed this Form 10-Q for the quarterly period ended June 30, 2006 of The Detroit Edison Company;

	2.		Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

	3.		Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

	4.		The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the registrant and have:

	a.		Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

	b.		(Intentionally omitted)

	c.		Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

	d.		Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

	a.		All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

	b.		Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.




/s/ ANTHONY F. EARLEY, JR.		Date: August 8, 2006

Anthony F. Earley, Jr.
Chairman of the Board and Chief Executive
Officer of The Detroit Edison Company

Exhibit 31-26

SECTION 302 CERTIFICATION

I, David E. Meador, certify that:

	1.		I have reviewed this Form 10-Q for the quarterly period ended June 30, 2006 of The Detroit Edison Company;

	2.		Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

	3.		Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

	4.		The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the registrant and have:

	a.		Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

	b.		(Intentionally omitted)

	c.		Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

	d.		Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

	a.		All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

	b.		Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.




/s/ DAVID E. MEADOR		Date: August 8, 2006

David E. Meador
Executive Vice President and
Chief Financial Officer of The Detroit Edison Company

Exhibit 32-25

CERTIFICATION PURSUANT TO
18 USC SECTION 1350,
AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report on Form 10-Q of The Detroit Edison Company (the “Company”) for the quarter ended June 30, 2006, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Anthony F. Earley, Jr., certify, pursuant to 18 USC Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that to the best of my knowledge and belief:

(1)		the Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2)		the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.



Dated: August 8, 2006	/s/ ANTHONY F. EARLEY, JR.
	Anthony F. Earley, Jr.
	Chairman of the Board and Chief Executive Officer of The Detroit Edison Company

A signed original of this written statement required by Section 906 has been provided to the Company and will be retained by the Company and furnished to the Securities and Exchange Commission or its staff upon request.

Exhibit 32-26

CERTIFICATION PURSUANT TO
18 USC SECTION 1350,
AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report on Form 10-Q of The Detroit Edison Company (the “Company”) for the quarter ended June 30, 2006, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, David E. Meador, certify, pursuant to 18 USC Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that to the best of my knowledge and belief:

(1)		the Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2)		the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.



Dated: August 8, 2006	/s/ DAVID E. MEADOR
	David E. Meador
	Executive Vice President and Chief Financial Officer of The Detroit Edison Company