CMS Energy (CMS) 10-K risk factor changes: FY2021 vs FY2020

[removed: CMS Energy cannot make assurances that its businesses will continue to] generate sufficient cash flow from operations to service its indebtedness, which could require CMS Energy to sell assets or obtain additional financing.

CMS Energy and Consumers are subject to rate regulation, which could have [removed: an] [added: a material] adverse effect on financial results.

FERC authorizes certain subsidiaries of CMS Energy to sell [added: wholesale] electricity at market-based rates.

CMS Energy and Consumers cannot predict the impact of new laws, rules, regulations, principles, or practices by federal or state [removed: agencies,] [added: agencies] or [added: wholesale electricity market operators, or] challenges or changes to present laws, rules, regulations, principles, or practices and the interpretation of any adoption or change.

FERC, through [removed: NERC,] [added: NERC and its delegated regional entities,] oversees reliability of certain portions of the electric grid.

CMS Energy and Consumers cannot predict the impact of FERC orders [removed: regarding] [added: or actions of NERC and its regional entities on] electric system reliability.

CMS Energy and Consumers are required to make judgments regarding the potential tax effects of various financial transactions and results of operations in order to estimate their obligations to taxing [removed: authorities.]

CMS Energy and its subsidiaries, including [removed: Consumers and EnerBank,] [added: Consumers,] must comply with the Dodd-Frank Act and its related [removed: regulations, which are subject to change and could involve material costs or affect operations.][added: regulations.]

[removed: In addition, the] [added: The] Dodd-Frank Act provides for regulation by the Commodity Futures Trading Commission of certain commodity-related contracts.

Although CMS Energy, Consumers, [removed: EnerBank,] and certain subsidiaries of CMS Enterprises qualify for an end-user exception from mandatory clearing of commodity-related swaps, these regulations could affect the ability of these entities to participate in these markets and could add additional regulatory oversight over their contracting activities.

CMS Energy and Consumers have interests in fossil-fuel-fired power [removed: plants and] [added: plants,] other types of power [removed: plants] [added: plants, and natural gas systems] that [removed: produce] [added: emit] greenhouse gases.

Management’s Discussion and Analysis of Financial Condition and Results of [removed: Operations—Outlook—Consumers Electric Utility Outlook and Uncertainties and Consumers Gas Utility Outlook and Uncertainties.][added: Operations—Outlook.]

Consumers expects to incur additional substantial costs related to the remediation of its former MGP sites and other response activity costs at a number of other [added: sites, including, but not limited to,] sites [added: of retired coal-fueled electric generating units,] under NREPA and CERCLA.

- availability of qualified construction [removed: personnel][added: personnel, both internal and contracted]

- changes in commodity and other [removed: prices][added: prices, applicable tariffs, and/or material and equipment availability]

In 2015, the matter was proceeding to formal arbitration; however, since then, the government of Equatorial Guinea has stopped [removed: communicating.][added: communicating with CMS Energy.]

CMS Energy has concluded that the government’s tax claim is without merit and [removed: will continue to contest] [added: believes] the [removed: claim,] [added: likelihood of material loss to be remote,] but cannot predict the financial impact or outcome of the matter.

While CMS Energy and Consumers have not been subject to cyber [removed: crime] incidents that have had a material impact on their operations to date, their security measures in place may be insufficient to prevent a major cyber incident in the future.

A variety of technological tools and systems, including both company-owned [removed: IT] [added: information technology] and technological services provided by outside parties, support critical functions.

Natural disasters, severe weather, wars, terrorist acts, civil unrest, vandalism, theft, cyber incidents, pandemics, and other catastrophic events could result in severe damage to CMS Energy’s and Consumers’ assets beyond what could be recovered through insurance policies (which are subject to [removed: deductibles] [added: deductibles, limitations,] and [removed: limits),] [added: self-insurance amounts that] could [added: be material), could] require CMS Energy and Consumers to incur significant upfront costs, and could severely disrupt operations, resulting in loss of service to customers.

CMS Energy and Consumers are exposed to changes in market prices for [added: commodities including, but not limited to,] natural gas, coal, electric capacity, electric energy, emission allowances, gasoline, diesel fuel, and RECs.

[removed: Consumers also has interstate transportation and] supply agreements in place to facilitate delivery of natural gas to its customers.

Future impacts of the pandemic could include a prolonged reduction in economic activity, extended disruption to supply chains and operations, [added: increased labor costs,] and reduced availability of labor and productivity.

This [removed: is] [added: remains] an evolving situation; CMS Energy and Consumers will continue to monitor developments and will take additional necessary precautions in order to keep employees, customers, contractors, and communities safe.

The degree to which COVID‑19 will [added: ultimately] impact CMS Energy and Consumers will depend in part on future developments, including the severity and duration of [removed: the outbreak,] [added: COVID-19 and its variants,] actions or inactions that may be taken by governmental authorities, [added: including, but not limited to, COVID-19 vaccination] and [added: testing requirements, and] to what extent and when normal economic and operational conditions can resume.

[added: Any delay or default in payment or] performance of contractual obligations could have a material adverse effect on CMS Energy and Consumers.

Unions represent [removed: 44] [added: 42] percent of Consumers’ employees.

CMS Energy cannot make assurances that its businesses will continue to

Distributed energy resources could have a material adverse effect on CMS Energy’s and Consumers’ businesses.

Michigan law allows customers to use distributed energy resources for their electric energy needs.

These distributed energy resources are connected to Consumers’ electric grid.

The state distributed generation program is currently capped by the 2016 Energy Law at one percent of utilities’ peak loads, but Consumers has voluntarily agreed to increase the cap to two percent on its system.

Consumers is required to purchase distributed generation customers’ excess generation at rates determined by the MPSC.

Recent FERC policy will also soon allow many customer-owned behind-the-meter and grid-connected distributed energy resources to participate in and receive revenue from wholesale electricity markets.

Increased customer use of distributed energy resources could result in a reduction of Consumers’ electric sales.

Third parties’ operations of distributed energy resources could also potentially have a negative impact on the stability of the grid.

An increase in customers’ use of distributed energy resources, and the rate structure for distributed energy resources customers’ use of Consumers’ system and Consumers’ purchases of their excess generation, could have a material adverse effect on CMS Energy and Consumers.

Transmission rates paid by Consumers and other CMS Energy subsidiaries are also set by FERC, as are the tariff terms governing the participation of Consumers and other CMS Energy subsidiaries in FERC-regulated wholesale electricity markets operated by regional transmission organizations and independent system operators such as MISO and PJM.

At least one CMS Energy subsidiary participates in the wholesale electricity markets operated by ERCOT, over which FERC has limited control.

Changes to the tariffs or business practice manuals of certain wholesale market operators such as MISO, PJM, or ERCOT could also have a material adverse effect on CMS Energy and Consumers.

Additionally, national gas pipeline infrastructure has recently been under scrutiny following disruptions related to extreme weather and cyber incidents.

In 2021, the Transportation Security Administration issued two mandatory security directives related to natural gas pipelines that apply to Consumers.

Additional regulation in this area could adversely affect Consumers’ gas operations.

CMS Energy and Consumers have announced an ambitious plan to reduce their impact on climate change.

Achieving this plan depends on numerous factors, many of which are outside of their control.

Consumers has announced a long-term strategy for delivering clean, reliable, resilient, and affordable energy, including a plan to end coal use in 2025 as set forth in the 2021 IRP.

The MPSC, FERC, other regulatory authorities, or other third parties may prohibit, delay, impair, or deny approval or consent of the 2021 IRP and some or all of the 2021 IRP-associated natural gas-fueled plant acquisitions, or deny reasonable rate recovery of the undepreciated plant balances associated with the retirement of coal-fueled plants necessary to proceed with the 2021 IRP.

Consumers may be unable to acquire, site, and/or permit some or all of the generation capacity proposed in the 2021 IRP.

Consumers’ ability to implement the 2021 IRP may be affected by global supply chain disruptions and changes in the cost, availability, and supply of generation capacity.

Advancements in technology related to items such as battery storage and electric vehicles may not become commercially available or economically feasible as projected in the 2021 IRP.

Customer programs such as energy efficiency and demand response may not realize the projected levels of customer participation.

CMS Energy and Consumers could suffer financial loss, reputational damage, litigation, or other negative repercussions if they are unable to achieve their ambitious plan.

authorities.

- inflation of labor rates

- increases in lead times and disruptions in supply chain distribution

- barriers to accessing key materials for renewable projects (solar, battery, and other key equipment) created by geopolitical relations and U.S. relations with China

Consumers also has interstate transportation and

CMS Energy and Consumers have also implemented masking and quarantine procedures, in accordance with CDC guidance.

Transmission rates are also set by FERC.

Regulations that are intended to implement the Dodd-Frank Act have been and are still being adopted and modified by the appropriate agencies.

The Dodd-Frank Act added a new Section 13 to the Bank Holding Company Act.

Known, together with its implementing regulations, as the Volcker Rule, it generally restricts certain banking entities (such as EnerBank) and their subsidiaries or affiliates from engaging in proprietary trading activities and from owning equity in or sponsoring any private equity funds or hedge funds (or certain other private issuing entities).

The activities of CMS Energy and its subsidiaries (including EnerBank) have not been and are not expected to be materially affected by the Volcker Rule; however, they are restricted from engaging in proprietary trading, investing in third‑party hedge or private equity funds (and certain other private issuing entities), and sponsoring these funds (and entities) in the future unless CMS Energy qualifies for an exemption from the rule.

CMS Energy and its subsidiaries are also subject to certain ongoing compliance requirements pursuant to the regulations.

CMS Energy cannot predict the full impact of the Volcker Rule, including any impact resulting from changes to implementing regulations, on CMS Energy’s or EnerBank’s operations or financial condition.

All companies that directly or indirectly control an FDIC-insured bank are required to serve as a source of financial strength for that institution.

As a result, CMS Energy could be called upon by the FDIC to infuse additional capital into EnerBank to the extent that EnerBank fails to satisfy its capital requirements.

In addition, CMS Energy is contractually required (i) to make cash capital contributions to EnerBank in the event that EnerBank does not maintain required minimum capital ratios and (ii) to provide EnerBank

financial support, in an amount and duration as may be necessary for EnerBank to meet the cash needs of its depositors and other operations.

Consumers retired seven smaller coal-fueled electric generating units in 2016.

Consumers may encounter environmental conditions that will need to be addressed in a timely fashion with state and federal environmental regulators as facilities and equipment on these sites are taken out of service.

A breach or failure of technology, including disaster recovery or backup systems, could also have a negative impact on CMS Energy’s banking subsidiary, EnerBank.

CMS Energy and Consumers have also implemented work-from-home policies where possible.

Consumers has experienced a decline in electric deliveries to commercial and industrial customers and increased uncollectible accounts.

Over the long term, the pandemic could have numerous and significant adverse effects on CMS Energy and Consumers.

Additionally, EnerBank could experience slower lending growth, higher loan write-offs, and increased loan modifications.

CMS Energy and Consumers cannot predict how the COVID‑19 pandemic will impact CMS Energy and Consumers.

Any delay or default in payment or

Adverse economic conditions could also have a negative impact on the loan portfolio of CMS Energy’s banking subsidiary, EnerBank.

It is the parent holding company of several subsidiaries, including Consumers, an electric and gas utility; [added: and] CMS Enterprises, primarily a domestic independent power producer and [removed: marketer; and EnerBank, an industrial bank located in Utah.][added: marketer.]

CMS Energy operates principally in [removed: four] [added: three] business segments: electric utility; gas utility; [added: and] enterprises, its non‑utility operations and [removed: investments; and EnerBank.][added: investments.]

CMS Energy and Consumers [removed: continue to take steps to protect the] [added: have aligned with] safety [added: and health guidelines from the CDC, OSHA, MIOSHA, and the Michigan Department] of [added: Health and Human Services in order to protect their] employees, customers, and [removed: contractors, and have executed their business continuity plans] [added: contractors] to ensure the continued delivery of critical energy services.

Risk [removed: Factors] [added: Factors;] and [removed: throughout this] Item [removed: 7.][added: 8.]

In support of this purpose, [removed: the companies] [added: CMS Energy and Consumers] employ the [removed: “Consumers Energy] [added: “CE] Way,” a lean operating model designed to improve safety, quality, cost, delivery, and employee morale.

CMS Energy and Consumers measure their progress toward the purpose by considering their impact on the “triple bottom line” of people, planet, and profit, which is underpinned by performance; this consideration takes into account not only the economic value that [removed: the companies] [added: CMS Energy and Consumers] create for customers and investors, but also their responsibility to social and environmental goals.

[removed: The triple bottom] line balances the interests of [removed: the companies’] employees, customers, suppliers, regulators, creditors, Michigan’s residents, the investment community, and other stakeholders, and it reflects the broader societal impacts of [removed: the companies’] [added: CMS Energy’s and Consumers’] activities.

[removed: ][added: ]

[removed: Consumers’] [added: CMS Energy’s Environmental, Social, Governance and] Sustainability Report, which is available to the public, describes [removed: the company’s] [added: CMS Energy’s and Consumers’] progress toward world class performance measured in the areas of people, planet, and profit.

People: The people element of the triple bottom line represents CMS Energy’s and Consumers’ commitment to their employees, their customers, the residents of local communities in which [removed: the companies] [added: they] do business, and other stakeholders.

[removed: Over the last ten years,] [added: Since 2010,] Consumers’ OSHA recordable incident rate has decreased by [removed: over 53] [added: 40] percent.

In addition, Consumers’ gas commodity costs declined by [removed: 66] [added: 52] percent [removed: from 2010 through 2020,] [added: over the last ten years,] due not only to a decrease in market prices but also to Consumers’ improvements to its gas infrastructure and optimization of its gas purchasing and storage strategy.

Management considers climate change and other environmental risks in [removed: the companies’] strategy development, business planning, and enterprise risk management processes.

As a result of actions already [removed: taken by] [added: taken,] CMS Energy and [removed: Consumers, the companies] [added: Consumers] have:

- decreased their combined percentage of electric supply (self-generated and purchased) from coal by [removed: 21] [added: 13] percentage points since 2015

- reduced carbon dioxide emissions by over [removed: 35] [added: 30] percent since 2005

- reduced the amount of water used to generate electricity by [removed: over] [added: nearly] 30 percent since 2012

- reduced landfill waste disposal by over [removed: 1.5] [added: 1.6] million tons since 1992

- reduced methane emissions by [removed: 17] [added: nearly 20] percent since 2012

[removed: Additionally, over the last 20 years,] [added: Since 2005,] Consumers has reduced its sulfur [removed: dioxide, nitrogen oxide, particulate matter,] [added: dioxide] and [removed: mercury] [added: particulate matter] emissions by over 90 [added: percent and its nitrogen oxide emissions by over 80] percent.

Presented in the following illustration are Consumers’ reductions in these [removed: emissions (Consumers began tracking mercury emissions in 2007):][added: emissions:]

[removed: ][added: ]

[added: Renewable Energy Plan:] The 2016 Energy [removed: Law:][added: Law raised the renewable energy standard to 15 percent in 2021.]

- raised the renewable energy standard to [removed: 12.5 percent in 2019 and] 15 percent in 2021; Consumers met the [removed: 12.5-percent] [added: 15-percent] requirement in [removed: 2019] [added: 2021] and [removed: 2020] [added: expects to meet the requirement in future years] with a combination of newly generated RECs and previously generated RECs carried over from prior years

- established a goal of 35 percent combined renewable energy and energy waste reduction by 2025; Consumers [removed: has] achieved [removed: 25] [added: 30] percent combined renewable energy and energy waste reduction through [removed: 2020][added: 2021]

- authorized incentives for demand response programs and [removed: expanded existing incentives for] energy efficiency programs, referring to the combined initiatives as energy waste reduction programs

- established an integrated planning process for new [removed: generation] [added: capacity and energy] resources

[removed: In 2019, the MPSC] [added: The Clean Energy Plan was originally outlined in Consumers’ 2018 IRP, which was] approved [added: by] the [removed: IRP that Consumers filed] [added: MPSC] in [removed: 2018, which details its Clean Energy Plan.][added: 2019.]

[removed: Further, Consumers plans] [added: These steps are expected] to [removed: replace its coal-fueled generation predominantly with investment in renewable energy, which will] enable Consumers to meet and exceed the 2016 Energy Law renewable energy requirements and fulfill increasing customer demand for renewable energy.

The [removed: Clean Energy Plan will] [added: 2021 IRP is] also [added: expected to] allow Consumers to [removed: achieve a] [added: exceed its] breakthrough goal of at least 50 percent combined renewable energy and energy waste reduction by 2030.

[removed: In February 2020,] Consumers [removed: announced] [added: has] a goal of achieving net-zero carbon emissions from its electric business by 2040.

Presented in the following illustration is Consumers’ [removed: 2020] [added: 2021] capacity portfolio and its future capacity portfolio as projected in the [added: 2021] IRP.

This illustration includes the effects of purchased capacity and energy waste reduction and uses the nameplate capacity [removed: of renewable] [added: for all] energy sources:

[removed: ][added: ]

In [removed: September] 2020, Michigan’s Governor signed an executive order creating the Michigan Healthy Climate Plan, which outlines goals for Michigan to achieve economy-wide net-zero greenhouse gas emissions and to be carbon neutral by 2050.

The executive order aims for a 28-percent reduction below 2005 levels of [removed: greenhouse gas emissions by 2025.]

Consumers has already surpassed the 28-percent reduction milestone for its owned electric generation and previously [removed: announced, in February 2020,] [added: announced] a goal of achieving net-zero carbon emissions from its electric business by 2040.

- to reduce its water use by one billion gallons; since 2017, Consumers reduced its water usage by over [removed: 880 million] [added: 1.3 billion] gallons cumulatively

- to enhance, restore, or protect 5,000 acres of land; since 2017, Consumers enhanced, restored, or protected over [removed: 4,600] [added: 6,000] acres of land cumulatively

- to reduce the amount of waste taken to landfills by 35 percent; compared to 2017, Consumers reduced its [added: landfill] waste [removed: to landfills] by [removed: 54] [added: 44] percent in [removed: 2020][added: 2021]

CMS Energy was also the parent holding company of EnerBank, an industrial bank located in Utah, until October 1, 2021 when EnerBank was acquired by Regions Bank as described below.

On October 1, 2021, EnerBank was acquired by Regions Bank.

CMS Energy received proceeds of over $1 billion from the transaction and recognized a pre-tax gain of $657 million.

CMS Energy intends to use the proceeds from the sale to fund key initiatives in its core energy business related to safety, reliability, and its clean energy transformation.

As a result of the sale described above, EnerBank is no longer included in the composition of CMS Energy’s reportable segments.

EnerBank’s results of operations through the date of the sale are presented as income from discontinued operations.

The triple bottom

In addition, while CMS Energy and Consumers have not yet experienced significant labor or supply chain disruption as a result of the COVID-19 pandemic, they continue to monitor minor disruptions and take steps to mitigate against future impacts in order to continue to provide safe and reliable service to customers.

In 2021, Consumers filed an updated Electric Distribution Infrastructure Investment Plan with the MPSC, which outlines a five-year strategy to improve its electric distribution system and the reliability of the grid.

The plan dedicates over $1 billion annually to projects that will reduce the number and duration of power outages to customers through investment in infrastructure upgrades, forestry management, and grid modernization.

- economic development to increase sales and reduce overall rates

Consumers began tracking mercury emissions in 2007; since that time, it has reduced such emissions by nearly 90 percent.

Consumers’ Clean Energy Plan details its strategy to meet customers’ long-term energy needs.

In June 2021, Consumers filed its 2021 IRP with the MPSC, proposing updates to the Clean Energy Plan.

Within its 2021 IRP, which is subject to MPSC approval, Consumers outlines its long-term strategy for delivering clean, reliable, resilient, and affordable energy to its customers, including plans to:

- end the use of coal-fueled generation in 2025, 15 years sooner than initially planned

- purchase existing natural gas-fueled generating units, providing an additional 2,177 MW of nameplate capacity and allowing Consumers to continue providing controllable sources of electricity to customers

- expand its investment in renewable energy, adding nearly 8,000 MW of solar generation by 2040

Consumers expects to meet 90 percent of its customers’ needs with clean energy sources by 2040 through execution of its 2021 IRP.

Carbon offset measures including, but not limited to, carbon sequestration, methane emission capture, and forest preservation and reforestation may be used to close the gap to achieving net-zero carbon emissions.

1 Does not include RECs.

greenhouse gas emissions by 2025.

In December 2021, Consumers announced plans to begin development of a renewable natural gas facility that will capture methane from manure generated at a neighboring farm and convert it into renewable natural gas.

The facility, expected to start production in 2023, will reduce methane emissions from the dairy farm and allow Consumers to deliver renewable natural gas as a cost-effective clean alternative fuel for customers.

Consumers exceeded each of these targets and is evaluating new targets for the coming years.

- introduced a new economic development rate designed to attract new business to Michigan and encourage existing businesses to expand their operations

- achieved five-year planet goals, set in 2018, to save one billion gallons of water; enhance, restore or protect 5000 acres of land in Michigan; and reduce waste sent to landfills by 35 percent

- introduced a new three-year electric vehicle pilot program designed to help fleet owners transition to electric vehicles

- announced plans to begin development of a renewable natural gas facility that will convert agricultural waste into clean, renewable natural gas

- expanded their renewable energy programs that assist both business and residential customers in meeting their sustainability goals

- received recognition as #1 utility company in the U.S. for America’s Best Employers for Women and America’s Best Employers for Diversity by Forbes®

In its order, the MPSC disallowed cost recovery for certain categories of recently completed capital expenditures incurred by Consumers.

The filing requests authority to recover new

infrastructure investment and related costs that are expected to allow Consumers to improve system safety and reliability and reduce fugitive methane emissions.

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| Discontinued operations | | | | | | | | | | | | | | | | | | | | | | | | | | | 602 | | | | | | 58 | | | | | | 544 | | | | | | | | | | | | | | | | | | | | |

| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

| Electric rate increase | | | | | | | | | | | | | | | | | | | | | 105 | | | | | | | | |

EnerBank provides primarily unsecured, fixed-rate installment loans throughout the U.S. to finance home improvements.

COVID-19 Pandemic

CMS Energy and Consumers continue to respond to the public health emergency caused by the COVID‑19 pandemic by instituting and maintaining measures consistent with guidance provided by local, state, and federal agencies.

CMS Energy and Consumers maintain over 60 departmental business continuity plans; these plans were reviewed and enhanced in early 2020 to ensure readiness for the COVID-19 pandemic.

Additionally, CMS Energy and Consumers have mitigated the potential impact of the pandemic on their liquidity by completing financing transactions and reducing the need for additional external funding.

The COVID‑19 pandemic is a continually evolving situation.

As a result of the pandemic, Consumers has experienced a decline in electric deliveries to commercial and industrial customers, offset partially by an increase in deliveries to residential customers.

It has also experienced increased uncollectible accounts and workforce-related expenses, among other cost increases directly attributable to the pandemic.

Consumers anticipates that these trends will continue in the near term.

In April 2020, the MPSC issued an

order authorizing Consumers to defer incremental uncollectible accounts expense associated with the pandemic.

Additionally, EnerBank anticipates it could experience slower lending growth, higher loan write-offs, and increased loan modifications in the future as a result of the pandemic.

The companies cannot predict the long-term impact of the pandemic on their business, results of operations, financial condition, capital investment program, liquidity, and cash flows.

More detailed discussion of the near-term impacts of and future uncertainties related to the COVID‑19 pandemic can be found in Item 1A.

Management’s Discussion and Analysis of Financial Condition and Results of Operations.

CMS Energy and Consumers have aligned with safety and health guidelines from the CDC, OSHA, and the Michigan Department of Health and Human Services in order to protect their employees, customers,

and contractors to ensure the continued delivery of critical energy services.

To align with, and in addition to, these guidelines, CMS Energy and Consumers have:

- secured the supply chain necessary to provide front-line workers with appropriate personal protective equipment and cleaning supplies

- worked with local health departments and hospital systems to begin administering vaccinations to essential front-line employees

- when necessary, sequestered employees with critical roles at generating plants, gas compression facilities, and electric control rooms

- implemented a paid self-quarantine requirement for employees who are exhibiting symptoms of COVID-19 or who have come into contact with a person suspected to have COVID-19

- prohibited business-related international travel and instituted a mandatory ten-day work remote period for employees who return from personal travel to heavily impacted areas

- required employees to work remotely when possible

- when necessary, reduced service at 13 direct payment offices to drop box and drive-through services only

- initially adjusted work to focus on emergent and critical activities such as electric outages, gas leaks, and other public safety and reliability work; as work restrictions have gradually lifted in Michigan, the companies have resumed normal work with safety measures in place

- contracted a chief medical officer to guide the companies’ response and provide rapid support and supplies for the workforce

- limited access to company facilities, enhanced cleaning protocols, and established a mask-wearing policy

- offered additional paid leave to employees to alleviate child care-related burdens and implemented other interim workforce policies to offer flexibility and reduce employee concerns

In response to the pandemic, CMS Energy and Consumers initially suspended shut-offs of service for non-payment and extended payment protection plans for low-income and senior customers.

CMS Energy and Consumers slowly began resuming shut-offs of service for non-payment in late July 2020 for commercial and industrial customers and in October 2020 for residential customers.

CMS Energy and Consumers remain committed to assisting customers impacted by the pandemic.

During 2020, Consumers provided $12 million to help Michigan residents and small businesses who had experienced difficulty paying their energy bill due to the pandemic.

Additionally, in December 2020, Consumers donated another $3 million to agencies that provide energy bill assistance to low-income households.

Consumers expects to reduce carbon emissions of its owned generation by more than 90 percent from its 2005 levels by 2040 through execution of its Clean Energy Plan.

The remaining emissions will be offset through alternative measures including, but not limited to, carbon sequestration, landfill methane emission capture, and large-scale tree planting.

CMS Energy, through CMS Enterprises, continues to pursue further opportunities for the development of renewable generation projects.

In July 2020, CMS Enterprises purchased an ownership interest in Aviator Wind, a 525-MW wind generation project in Coke County, Texas.

The project was completed and became operational in September 2020.

Consumers has experienced a decline in electric deliveries to commercial and industrial customers as a result of the COVID-19 pandemic.

CMS Energy and Consumers enter into these contracts using established policies and procedures, under [added: the direction of an executive oversight committee consisting of certain officers and a risk committee consisting of those and other officers and business managers.]

| December 31 | | | [removed: 2020] [added: 2021] | | | | | | [removed: 2019] [added: 2020] | | | | | |

| CMS Energy, including Consumers | | | | | | $ | [removed: 634] [added: 639] | | | | | $ | [removed: 558] [added: 612] | |

| Consumers | | | | | | [removed: 372] [added: 402] | | | | | | [removed: 355] [added: 372] | | |

The annual earnings exposure related to variable-rate financing was immaterial for both CMS Energy and Consumers at December 31, [removed: 2020] [added: 2021] and [removed: 2019,] [added: 2020,] assuming an adverse change in market interest rates of ten percent.

For additional details on financial [removed: instruments,] [added: instruments] see Item 8.

Financial Statements and Supplementary Data—Notes to the Consolidated Financial Statements—Note [removed: 7,] [added: 6,] Financial Instruments.

the direction of an executive oversight committee consisting of certain officers and a risk committee consisting of those and other officers and business managers.

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| *In Millions* | | | | | | | | | | | | | | |

Notes Receivable: CMS Energy is exposed to interest-rate risk resulting from EnerBank’s fixed-rate installment loans.

EnerBank provides primarily unsecured, fixed-rate installment loans throughout the U.S. to finance home improvements.

Presented in the following table is a sensitivity analysis of interest-rate risk on EnerBank’s notes receivable, which includes the effects of interest-rate swaps (assuming an adverse change in market interest rates of ten percent):

| Notes receivable—potential loss in fair value | | | | | | $ | 77 | | | | | $ | 61 | |

The fair value losses for CMS Energy in the above table could be realized only if EnerBank’s loans were sold to other parties.

The annual earnings exposure related to variable-rate interest receipts at EnerBank was immaterial at December 31, 2020 and 2019.

It is the parent holding company of several subsidiaries, including Consumers, an electric and gas utility; [added: and] CMS Enterprises, primarily a domestic independent power producer and [removed: marketer; and EnerBank, an industrial bank located in Utah.][added: marketer.]

CMS Energy manages its businesses by the nature of services each provides, and operates principally in [removed: four] [added: three] business segments: electric utility; gas utility; [added: and] enterprises, its non‑utility operations and [removed: investments; and EnerBank.][added: investments.]

CMS Energy’s consolidated operating revenue was [removed: $6.7] [added: $7.3] billion in [removed: 2020, $6.8] [added: 2021, $6.4] billion in [removed: 2019,] [added: 2020,] and [removed: $6.9] [added: $6.6] billion in [removed: 2018.][added: 2019.]

For further information about operating revenue, income, and assets and liabilities attributable to all of CMS Energy’s business segments and operations, see Item [removed: 6.][added: 8.]

Consumers’ consolidated operating revenue was [removed: $6.2] [added: $7.0] billion in [removed: 2020, $6.4] [added: 2021, $6.2] billion in [removed: 2019,] [added: 2020,] and [removed: $6.5] [added: $6.4] billion in [removed: 2018.][added: 2019.]

For further information about operating revenue, income, and assets and liabilities attributable to Consumers’ electric and gas utility operations, see Item [removed: 6.][added: 8.]

Consumers owns its principal properties in fee, except that most electric [removed: lines and] [added: lines,] gas [removed: mains] [added: mains, and renewable generation projects] are located below or adjacent to public roads or on land owned by others and are accessed by Consumers through [removed: easements] [added: easements, leases,] and other rights.

In [removed: 2020,] [added: 2021,] Consumers served 1.9 million electric customers and 1.8 million gas customers in Michigan’s Lower Peninsula.

| [removed: ] [added: ] | | | | | | | | | | | |

CMS Energy and [removed: Consumers – The] [added: Consumers—The] Triple Bottom Line

Electric Utility Operations: Consumers’ electric utility operations, which include the generation, purchase, distribution, and sale of electricity, generated operating revenue of [removed: $4.4] [added: $5.0] billion in [removed: 2020 and 2019,] [added: 2021,] and [removed: $4.6] [added: $4.4] billion in [removed: 2018.][added: 2020 and 2019.]

Presented in the following illustration is Consumers’ [removed: 2020] [added: 2021] electric utility operating revenue of [removed: $4.4] [added: $5.0] billion by customer class:

[removed: ][added: ]

In [removed: 2019,] [added: 2021,] Consumers’ electric deliveries were [removed: 37] [added: 36] billion kWh, which included ROA deliveries of [removed: four] [added: three] billion kWh, resulting in net bundled sales of 33 billion kWh.

Presented in the following illustration are Consumers’ monthly weather-normalized electric deliveries (deliveries adjusted to reflect normal weather conditions) to its customers, including ROA deliveries, during [removed: 2020] [added: 2021] and [removed: 2019:][added: 2020:]

[removed: ][added: ]

Consumers’ [removed: 2020] [added: 2021] summer peak demand was [removed: 8,215] [added: 7,951] MW, which included ROA demand of [removed: 540] [added: 581] MW.

For the [removed: 2019-2020] [added: 2020-2021] winter season, Consumers’ peak demand was [removed: 5,602] [added: 5,386] MW, which included ROA demand of [removed: 464] [added: 465] MW.

As required by MISO reserve margin requirements, Consumers owns or controls, through long-term PPAs and short-term capacity purchases, all of the capacity required to supply its projected firm peak load and necessary reserve margin for summer [removed: 2021.][added: 2022.]

- [removed: 205] [added: 208] miles of high-voltage distribution overhead lines operating at 138 kV

- [removed: 77,833] [added: 82,474] miles of electric distribution overhead lines

- [removed: 9,264] [added: 9,395] miles of underground distribution lines

- [removed: 1,096] [added: 1,093] substations with an aggregate transformer capacity of 26 million kVA

- [removed: two] [added: three] battery facilities with storage capacity of 2 [removed: MW][added: MWh]

[removed: This goal includes not only emissions from] Consumers’ owned generation, but also emissions from the generation of power purchased through long-term PPAs and from the MISO energy market.

Consumers expects to [removed: reduce carbon emissions of its owned generation by more than] [added: meet] 90 percent [removed: from] [added: of] its [removed: 2005 levels] [added: customers’ needs with clean energy sources] by 2040 through execution of its [removed: Clean Energy Plan,] [added: 2021 IRP,] which calls for replacing its coal-fueled generation predominantly with investment in renewable energy.

Specifically, the [removed: Clean Energy Plan] [added: 2021 IRP] provides for [added: a full transition away from coal-fueled generation by] the [added: end of 2025 and includes the] retirement of the D.E. Karn [removed: 1 & 2] [added: oil/gas-fueled and] coal-fueled generating units in 2023 and the [removed: potential retirement of the] J.H. Campbell [removed: 1 & 2] coal-fueled generating units in [removed: 2031 or earlier.][added: 2025.]

Presented in the following table are details about Consumers’ [removed: 2020] [added: 2021] electric generation and supply mix:

| Name and Location (Michigan) | | | Number of Units and Year Entered Service | | | [removed: 2020] [added: 2021] Generation Capacity (MW) | | | 1 | | | [removed: 2020] [added: 2021] Electric Supply (GWh) | | | | | |

| J.H. Campbell 1 & 2 – West [removed: Olive] [added: Olive2] | | | 2 Units, 1962-1967 | | | [removed: 540] [added: 600] | | | | | | [removed: 1,538] [added: 3,123] | | | | | |

| J.H. Campbell 3 – West [removed: Olive2] [added: Olive2,3] | | | 1 Unit, 1980 | | | [removed: 785] [added: 788] | | | | | | [removed: 4,804] [added: 4,784] | | | | | |

| D.E. Karn 1 & 2 – [removed: Essexville3] [added: Essexville4] | | | 2 Units, 1959-1961 | | | [removed: 460] [added: 487] | | | | | | [removed: 1,618] [added: 2,954] | | | | | |

| D.E. Karn 3 & 4 – [removed: Essexville] [added: Essexville4] | | | 2 Units, 1975-1977 | | | [removed: 1,058] [added: 934] | | | | | | [removed: 37] [added: 128] | | | | | |

| Ludington – Ludington | | | 6 Units, 1973 | | | [removed: 975] [added: 927] | | | [removed: 4] [added: 5] | | | [removed: (371)] [added: (321)] | | | [removed: 5] [added: 6] | | |

| Conventional hydro generation – various locations | | | 35 Units, 1906-1949 | | | 76 | | | | | | [removed: 482] [added: 398] | | | | | |

| Jackson – Jackson | | | 1 Unit, 2002 | | | [removed: 547] [added: 541] | | | | | | [removed: 1,786] [added: 2,141] | | | | | |

| Zeeland – Zeeland | | | 3 Units, 2002 | | | [removed: 534] [added: 531] | | | | | | [removed: 3,465] [added: 2,839] | | | | | |

| Zeeland (simple cycle) – Zeeland | | | 2 Units, 2001 | | | [removed: 318] [added: 316] | | | | | | [removed: 601] [added: 454] | | | | | |

| Cross Winds® Energy Park – Tuscola County | | | 114 Turbines, 2014, 2018, and 2019 | | | [removed: 39] [added: 35] | | | | | | [removed: 722] [added: 661] | | | | | |

| Lake Winds® Energy Park – Mason County | | | 56 Turbines, 2012 | | | [removed: 16] [added: 13] | | | | | | [removed: 273] [added: 239] | | | | | |

CMS Energy was also the parent holding company of EnerBank, an industrial bank located in Utah, until October 1, 2021 when EnerBank was acquired by Regions Bank.

This goal includes not only emissions from

Carbon offset measures including, but not limited to, carbon sequestration, methane emission capture, and forest preservation and reforestation may be used to close the gap to achieving net-zero carbon emissions.

For further information on Consumers’ progress towards its net-zero carbon emissions goal, see Item 7.

| | | | | | | 1,875 | | | | | | 10,861 | | | | | |

| | | | | | | 1,003 | | | | | | 77 | | | | | |

| | | | | | | 1,072 | | | | | | 4,980 | | | | | |

| Crescent Wind Farm – Hillsdale County | | | 60 Turbines, 2021 | | | 25 | | | | | | 316 | | | | | |

| | | | | | | 97 | | | | | | 1,570 | | | | | |

| Total owned generation | | | | | | 5,300 | | | | | | 18,076 | | | | | |

| Nuclear generation – Palisades8 | | | | | | 792 | | | | | | 6,901 | | | | | |

| | | | | | | 2,552 | | | | | | 15,665 | | | | | |

| Net interchange power9 | | | | | | — | | | | | | 645 | | | | | |

| Total supply | | | | | | 7,852 | | | | | | 34,386 | | | | | |

2Consumers plans to retire these generating units in 2025, subject to MPSC approval.

4Consumers plans to retire these generating units in 2023, subject to MPSC approval.

Financial Statements and Supplementary Data—Notes to the Consolidated Financial Statements—Note 3, Contingencies and Commitments—Contractual Commitments.

For further information on Consumers’ progress towards its net-zero methane emissions goal, see Item 7.

| Paulding County, Ohio | | | 100 | | | Solar and storage | | | 3 | | | | | | 4 | | |

| Total | | | | | | | | | 1,841 | | | | | | 7,364 | | |

2DIG, CMS Generation Michigan Power, and CMS ERM have entered into an agreement to sell these plants to Consumers in 2025, subject to MPSC approval.

Financial Statements and Supplementary Data—Notes to the Consolidated Financial Statements—Note 2, Regulatory Matters.

The Transportation Security Administration, an agency of the U.S. Department of Homeland Security, regulates certain activities related to the safety and security of natural gas pipelines.

Consumers expects to meet 90 percent of its customers’ needs with clean energy sources by 2040 through execution of its 2021 IRP, which calls for replacing its coal-fueled generation predominantly with investment in renewable energy.

Carbon offset measures including, but not limited to, carbon sequestration, methane emission capture, and forest preservation and reforestation may be used to close the gap to achieving net-zero carbon emissions.

In February 2021, Consumers took ownership and began operation of a 166-MW wind generation project in Hillsdale, Michigan.

Additionally, during 2021, Consumers entered into agreements to purchase two solar generating facilities as well as PPAs to purchase renewable energy from solar generating facilities presently being developed by other parties.

For additional information on these facilities, which are expected to be operational between 2022 and 2024, see Item 7.

Management’s Discussion and Analysis of Financial Condition and Results of Operations—Outlook—Consumers Electric Utility Outlook and Uncertainties.

In December 2021, Consumers announced plans to begin development of a renewable natural gas facility that will capture methane from manure generated at a neighboring farm and convert it into renewable natural gas.

The facility, expected to start production in 2023, will reduce methane emissions from the dairy farm and allow Consumers to deliver renewable natural gas as a cost-effective clean alternative fuel for customers.

Financial Statements and Supplementary Data—Notes to the Consolidated Financial Statements—Note 3, Contingencies and Commitments.

| Seasonal employees1 | | | 613 | | | 603 | | | 594 | | |

| Contractors | | | 656 | | | 508 | | | 509 | | |

The recordable incident rate was 1.54 in 2021 and 1.22 in 2020.

The target recordable incident rate for 2022 is 1.13.

Since 2010, Consumers’ OSHA recordable incident rate has decreased by 40 percent.

Management’s Discussion and Analysis of Financial Condition and Results of Operations—Executive Overview.

compensation and benefits that are competitive with industry peers.

- Interfaith, a space for co-workers of all backgrounds to gather and celebrate their unique beliefs, creating an environment of understanding and respect for all faiths, religions, and spiritual beliefs, including those with no faith affiliation

EnerBank provides primarily unsecured, fixed-rate installment loans throughout the U.S. to finance home improvements.

Selected Financial Data and Item 8.

The remaining emissions will be offset through alternative measures including, but not limited to, carbon sequestration, landfill methane emission capture, and large-scale tree planting.

| | | | | | | 1,785 | | | | | | 7,960 | | | | | |

| | | | | | | 1,051 | | | | | | 111 | | | | | |

| | | | | | | 1,081 | | | | | | 5,251 | | | | | |

| | | | | | | 55 | | | | | | 1,017 | | | | | |

| | | | | | | 2,577 | | | | | | 16,982 | | | | | |

began operation in December 2020.

3Consumers plans to retire these coal-fueled generating units in 2023.

| Total owned generation | | | 14,983 | | | 17,020 | | | 15,943 | | |

| Nuclear generation | | | 6,898 | | | 6,946 | | | 6,749 | | |

| Net interchange power3 | | | 2,655 | | | 2,059 | | | 4,953 | | |

| Total supply | | | 34,620 | | | 35,686 | | | 37,247 | | |

| Total | | | | | | | | | 1,838 | | | | | | 6,877 | | |

2Began operation in September 2020.

EnerBank

EnerBank Operations: EnerBank is a Utah state-chartered, FDIC-insured industrial bank providing primarily unsecured, fixed-rate installment loans throughout the U.S. to finance home improvements.

EnerBank works with strategic business partners and contractors throughout the U.S. to provide homeowners with payment options for home improvements.

Strategic business partners include manufacturers, distributors, franchisors, member or trade associations, and major retailers of home improvement, remodeling, and energy-saving products and services.

EnerBank’s operating revenue was $262 million in 2020, $221 million in 2019, and $157 million in 2018.

EnerBank’s average loan size is $10,000 and all of the loans originated by EnerBank in 2020 were fixed-rate installment loans.

The distribution of borrowers throughout the U.S. is generally consistent with the population distribution by state.

EnerBank Competition: EnerBank competes with FDIC-insured banks, credit unions, consumer finance companies, and financial technology companies.

EnerBank addresses this competition by:

- offering competitive loan features and pricing

- maintaining a stable funding model

- providing convenient loan processes for contractors and homeowners

- providing strong marketing support for strategic business partners and authorized contractors

- focusing on customer service

EnerBank is regulated by the Utah Department of Financial Institutions and the FDIC.

Additionally, Consumers began operation of Gratiot Farms Wind Project, a 150-MW wind generation project, in December 2020 and expects to take full ownership and begin commercial operation of another with capacity of up to 166 MW in early 2021.

Furthermore, Consumers has executed agreements to purchase another wind generation project under development, with capacity of up to 201 MW, and a solar generating facility under development, with capacity of up to 150 MW.

For each of these projects, Consumers expects to take full ownership and begin commercial operation of the project in 2022.

There were 101 recordable incidents in 2020 and 105 recordable incidents in 2019.

The target for 2021 is no more than 81 recordable incidents.

Over the last ten years, Consumers’ OSHA recordable incident rate has decreased by over 53 percent and ranks in the first quartile of its EEI peer group.

| Vice President | | | 10/2010 – 7/2016 | | |

| Jean-Francois Brossoit (age 53)2 | | | | | |

| Vice President | | | 11/2016 – 4/2017 | | |

Financial Statements and Supplementary Data—Notes to the Consolidated Financial Statements—Note [removed: 3,] [added: 2,] Regulatory Matters and Note [removed: 4,] [added: 3,] Contingencies and Commitments.

For the fiscal year ended December 31, [removed: 2020][added: 2021]

| [removed: Securities] [added: Securities] registered pursuant to Section 12(b) of the [removed: Act:] [added: Act:] | | | | | | | | | | | | | | |

| [removed: Securities] [added: Securities] registered pursuant to Section 12(g) of the [removed: Act:] [added: Act:] | | | None | | | | | |

The aggregate market value of CMS Energy voting and non‑voting common equity held by non‑affiliates was [removed: $16.647] [added: $17.113] billion for the [removed: 284,957,910] [added: 289,652,428] CMS Energy Corporation Common Stock shares outstanding on June 30, [removed: 2020] [added: 2021] based on the closing sale price of [removed: $58.42] [added: $59.08] for CMS Energy Corporation Common Stock, as reported by the New York Stock Exchange on such date.

There were no shares of Consumers common equity held by non‑affiliates as of June 30, [removed: 2020.][added: 2021.]

There were [removed: 288,943,354] [added: 289,760,265] shares of CMS Energy Corporation Common Stock outstanding on January [removed: 15, 2021.][added: 14, 2022.]

On January [removed: 15, 2021,] [added: 14, 2022,] CMS Energy held all 84,108,789 outstanding shares of common stock of Consumers.

Documents incorporated by reference in Part III: CMS Energy’s and Consumers’ proxy statement relating to their [removed: 2021] [added: 2022] Annual Meetings of Shareholders to be held May [removed: 7, 2021.][added: 6, 2022.]

Annual Reports on Form 10-K to the Securities and Exchange Commission for the Year Ended December 31, [removed: 2020][added: 2021]

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| [Item [removed: 11.](#ibe111af6d52149569b23f8b48d5770c6_268)] [added: 11.](#i801264ff445748f994f9556d2f07e0a4_463)] | | | [Executive [removed: Compensation](#ibe111af6d52149569b23f8b48d5770c6_268)] [added: Compensation](#i801264ff445748f994f9556d2f07e0a4_463)] | | | [removed: [192](#ibe111af6d52149569b23f8b48d5770c6_268)] [added: [188](#i801264ff445748f994f9556d2f07e0a4_463)] | | |

| [Item [removed: 12.](#ibe111af6d52149569b23f8b48d5770c6_271)] [added: 12.](#i801264ff445748f994f9556d2f07e0a4_466)] | | | [Security Ownership of Certain Beneficial Owners and Management and Related Stockholder [removed: Matters](#ibe111af6d52149569b23f8b48d5770c6_271)] [added: Matters](#i801264ff445748f994f9556d2f07e0a4_466)] | | | [removed: [192](#ibe111af6d52149569b23f8b48d5770c6_271)] [added: [189](#i801264ff445748f994f9556d2f07e0a4_466)] | | |

| [Item [removed: 13.](#ibe111af6d52149569b23f8b48d5770c6_274)] [added: 13.](#i801264ff445748f994f9556d2f07e0a4_469)] | | | [Certain Relationships and Related Transactions, and Director [removed: Independence](#ibe111af6d52149569b23f8b48d5770c6_274)] [added: Independence](#i801264ff445748f994f9556d2f07e0a4_469)] | | | [removed: [193](#ibe111af6d52149569b23f8b48d5770c6_274)] [added: [189](#i801264ff445748f994f9556d2f07e0a4_469)] | | |

| [Item [removed: 14.](#ibe111af6d52149569b23f8b48d5770c6_277)] [added: 14.](#i801264ff445748f994f9556d2f07e0a4_472)] | | | [Principal Accountant Fees and [removed: Services](#ibe111af6d52149569b23f8b48d5770c6_277)] [added: Services](#i801264ff445748f994f9556d2f07e0a4_472)] | | | [removed: [193](#ibe111af6d52149569b23f8b48d5770c6_277)] [added: [189](#i801264ff445748f994f9556d2f07e0a4_472)] | | |

| [Item [removed: 15.](#ibe111af6d52149569b23f8b48d5770c6_283)] [added: 15.](#i801264ff445748f994f9556d2f07e0a4_478)] | | | [Exhibits and Financial Statement [removed: Schedules](#ibe111af6d52149569b23f8b48d5770c6_283)] [added: Schedules](#i801264ff445748f994f9556d2f07e0a4_478)] | | | [removed: [195](#ibe111af6d52149569b23f8b48d5770c6_283)] [added: [191](#i801264ff445748f994f9556d2f07e0a4_478)] | | |

| [Item [removed: 16.](#ibe111af6d52149569b23f8b48d5770c6_319)] [added: 16.](#i801264ff445748f994f9556d2f07e0a4_514)] | | | [Form 10-K [removed: Summary](#ibe111af6d52149569b23f8b48d5770c6_319)] [added: Summary](#i801264ff445748f994f9556d2f07e0a4_514)] | | | [removed: [207](#ibe111af6d52149569b23f8b48d5770c6_319)] [added: [204](#i801264ff445748f994f9556d2f07e0a4_514)] | | |

[added: |] 2016 Energy Law [added: | | |]

[added: |] Michigan’s Public Acts 341 and 342 of 2016 [added: | | |]

[added: |] ABATE [added: | | |]

[removed: The] [added: |] Association of Businesses Advocating Tariff Equity [added: | | |]

[added: |] ABO [added: | | |]

[added: |] Accumulated benefit obligation; the liabilities of a pension plan based on service and pay to date, which differs from the PBO in that it does not reflect expected future salary increases [added: | | |]

[added: |] AFUDC [added: | | |]

[added: |] Allowance for borrowed and equity funds used during construction [added: | | |]

[added: |] AOCI [added: | | |]

| CMS Energy Corporation Depositary Shares, each representing a 1/1,000th interest in a share of 4.200% Cumulative Redeemable Perpetual Preferred Stock, Series C | | | | | | CMS PRC | | | | | | New York Stock Exchange | | |

| [Glossary](#i801264ff445748f994f9556d2f07e0a4_28) | | | | | | [2](#i801264ff445748f994f9556d2f07e0a4_28) | | |

| | | | | | | | | |

| [Part I](#i801264ff445748f994f9556d2f07e0a4_43) | | | | | | [15](#i801264ff445748f994f9556d2f07e0a4_43) | | |

| [Part II](#i801264ff445748f994f9556d2f07e0a4_100) | | | | | | [48](#i801264ff445748f994f9556d2f07e0a4_100) | | |

| [Item 6.](#i801264ff445748f994f9556d2f07e0a4_106) | | | [Reserved](#i801264ff445748f994f9556d2f07e0a4_106) | | | [50](#i801264ff445748f994f9556d2f07e0a4_106) | | |

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| [Item 9](#i801264ff445748f994f9556d2f07e0a4_3636)[C](#i801264ff445748f994f9556d2f07e0a4_3636)[.](#i801264ff445748f994f9556d2f07e0a4_3636) | | | [Disclosure Regarding Foreign Jurisdictions that Prevent Inspections](#i801264ff445748f994f9556d2f07e0a4_3636) | | | [187](#i801264ff445748f994f9556d2f07e0a4_3636) | | |

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| [Part III](#i801264ff445748f994f9556d2f07e0a4_457) | | | | | | [187](#i801264ff445748f994f9556d2f07e0a4_457) | | |

| [Part IV](#i801264ff445748f994f9556d2f07e0a4_475) | | | | | | [191](#i801264ff445748f994f9556d2f07e0a4_475) | | |

| [Signatures](#i801264ff445748f994f9556d2f07e0a4_517) | | | | | | [205](#i801264ff445748f994f9556d2f07e0a4_517) | | |

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| [Glossary](#ibe111af6d52149569b23f8b48d5770c6_10) | | | | | | [2](#ibe111af6d52149569b23f8b48d5770c6_10) | | |

| [Part I](#ibe111af6d52149569b23f8b48d5770c6_19) | | | | | | [14](#ibe111af6d52149569b23f8b48d5770c6_19) | | |

| [Part II](#ibe111af6d52149569b23f8b48d5770c6_40) | | | | | | [47](#ibe111af6d52149569b23f8b48d5770c6_40) | | |

| [Item 6.](#ibe111af6d52149569b23f8b48d5770c6_46) | | | [Selected Financial Data](#ibe111af6d52149569b23f8b48d5770c6_46) | | | [50](#ibe111af6d52149569b23f8b48d5770c6_46) | | |

| [Part III](#ibe111af6d52149569b23f8b48d5770c6_262) | | | | | | [191](#ibe111af6d52149569b23f8b48d5770c6_262) | | |

| [Part IV](#ibe111af6d52149569b23f8b48d5770c6_280) | | | | | | [195](#ibe111af6d52149569b23f8b48d5770c6_280) | | |

| [Signatures](#ibe111af6d52149569b23f8b48d5770c6_322) | | | | | | [208](#ibe111af6d52149569b23f8b48d5770c6_322) | | |

ASU

Financial Accounting Standards Board Accounting Standards Update

Cantera Gas Company

Cantera Gas Company LLC, a non‑affiliated company, formerly known as CMS Field Services

Cantera Natural Gas, Inc.

Cantera Natural Gas, Inc., a non‑affiliated company that purchased CMS Field Services

CARES Act

Coronavirus Aid, Relief, and Economic Security Act of 2020

CMS Field Services

CMS Field Services, Inc., a former wholly owned subsidiary of CMS Gas Transmission

CMS Gas Transmission

CMS Land Company, a wholly owned subsidiary of CMS Capital

CMS MST

CMS Marketing, Services and Trading Company, a wholly owned subsidiary of CMS Enterprises, whose name was changed to CMS ERM in 2004

Discount Window

Federal Reserve lending program to depository institutions

EEI

Edison Electric Institute, an association representing all U.S. investor-owned electric companies

FDIC

Federal Deposit Insurance Corporation

Federal Reserve

Federal Reserve System, the central bank of the U.S.

FICO

Fair Isaac Corporation, a non-affiliated company providing data analytic services, with a focus on credit scoring services

IT

Information Technology

kV

mcf

Thousand cubic feet

Michigan Mercury Rule

Michigan Air Pollution Control Rules of 2009, as amended: Part 15, Emission Limitations and Prohibitions—Mercury

MW

At January [removed: 15, 2021,] [added: 14, 2022,] the number of registered holders of CMS Energy’s common stock totaled [removed: 28,083,] [added: 27,158,] based on the number of record holders.

Financial Statements and Supplementary Data—Notes to the Consolidated Financial Statements—Note [removed: 13,] [added: 11,] Stock-Based Compensation and Item 12.

Financial Statements and Supplementary Data—Notes to the Consolidated Financial Statements—Note [removed: 5,] [added: 4,] Financings and Capitalization.

[removed: ][added: ]

| Company/Index | | | [removed: 2015] [added: 2016] | | | | | | [removed: 2016] [added: 2017] | | | | | | [removed: 2017] [added: 2018] | | | | | | [removed: 2018] [added: 2019] | | | | | | [removed: 2019] [added: 2020] | | | | | | [removed: 2020] [added: 2021] | | | | | |

Presented in the following table are CMS Energy’s repurchases of [removed: equity securities] [added: common stock] for the three months ended December 31, [removed: 2020:][added: 2021:]

| CMS Energy | | | | | | $ | 100 | | | | | $ | 117 | | | | | $ | 127 | | | | | $ | 165 | | | | | $ | 164 | | | | | $ | 180 | |

| S&P 500 Index | | | | | | 100 | | | | | | 122 | | | | | | 116 | | | | | | 153 | | | | | | 181 | | | | | | 233 | | |

| Dow Jones Utility Index | | | | | | 100 | | | | | | 113 | | | | | | 116 | | | | | | 147 | | | | | | 150 | | | | | | 176 | | |

| S&P 400 Utilities Index | | | | | | 100 | | | | | | 111 | | | | | | 119 | | | | | | 136 | | | | | | 117 | | | | | | 140 | | |

| October 1, 2021 to October 31, 2021 | | | | | | 706 | | | | | | $ | 59.73 | | | | | — | | | | | | — | | |

| November 1, 2021 to November 30, 2021 | | | | | | 72 | | | | | | 60.29 | | | | | | — | | | | | | — | | |

| December 1, 2021 to December 31, 2021 | | | | | | 702 | | | | | | 63.73 | | | | | | — | | | | | | — | | |

| Total | | | | | | 1,480 | | | | | | $ | 61.65 | | | | | — | | | | | | — | | |

Market prices for CMS Energy’s common stock and related security holder matters are contained in Item 6.

Selected Financial Data, which is incorporated by reference herein.

| CMS Energy | | | | | | $ | 100 | | | | | $ | 119 | | | | | $ | 139 | | | | | $ | 151 | | | | | $ | 196 | | | | | $ | 195 | |

| S&P 500 Index | | | | | | 100 | | | | | | 112 | | | | | | 136 | | | | | | 130 | | | | | | 171 | | | | | | 203 | | |

| Dow Jones Utility Index | | | | | | 100 | | | | | | 118 | | | | | | 134 | | | | | | 137 | | | | | | 174 | | | | | | 177 | | |

| S&P 400 Utilities Index | | | | | | 100 | | | | | | 127 | | | | | | 141 | | | | | | 151 | | | | | | 173 | | | | | | 149 | | |

| October 1, 2020 to October 31, 2020 | | | | | | 406 | | | | | | $ | 63.78 | | | | | — | | | | | | — | | |

| November 1, 2020 to November 30, 2020 | | | | | | 235 | | | | | | 63.92 | | | | | | — | | | | | | — | | |

| December 1, 2020 to December 31, 2020 | | | | | | 623 | | | | | | 59.48 | | | | | | — | | | | | | — | | |

| Total | | | | | | 1,264 | | | | | | $ | 61.69 | | | | | — | | | | | | — | | |

CMS Energy Corporation

| | | | | | | | | | | | | | | | | | | | | |

| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |

| | | | | | | 2020 | | | 2019 | | | 2018 | | | 2017 | | | 2016 | | |

| Operating revenue (in millions) | | | ($) | | | 6,680 | | | 6,845 | | | 6,873 | | | 6,583 | | | 6,399 | | |

| Income from equity method investees (in millions) | | | ($) | | | 5 | | | 10 | | | 9 | | | 15 | | | 13 | | |

| Net income (in millions) | | | ($) | | | 752 | | | 682 | | | 659 | | | 462 | | | 553 | | |

| Income (loss) attributable to noncontrolling interests (in millions) | | | ($) | | | (3) | | | 2 | | | 2 | | | 2 | | | 2 | | |

| Net income available to common stockholders (in millions) | | | ($) | | | 755 | | | 680 | | | 657 | | | 460 | | | 551 | | |

| Average common shares outstanding (in millions) | | | | | | 285.0 | | | 283.0 | | | 282.2 | | | 280.0 | | | 277.9 | | |

| Earnings per average common share | | | | | | | | | | | | | | | | | | | | |

| – Basic | | | ($) | | | 2.65 | | | 2.40 | | | 2.33 | | | 1.64 | | | 1.99 | | |

| – Diluted | | | ($) | | | 2.64 | | | 2.39 | | | 2.32 | | | 1.64 | | | 1.98 | | |

| Cash provided by operations (in millions) | | | ($) | | | 1,276 | | | 1,790 | | | 1,703 | | | 1,705 | | | 1,629 | | |

| Capital expenditures, excluding assets placed under finance lease (in millions) | | | ($) | | | 2,317 | | | 2,104 | | | 2,074 | | | 1,665 | | | 1,672 | | |

| Total assets (in millions) | | | ($) | | | 29,666 | | | 26,837 | | | 24,529 | | | 23,050 | | | 21,622 | | |

| Long-term debt, excluding current portion (in millions) | | | ($) | | | 13,634 | | | 11,951 | | | 10,615 | | | 9,123 | | | 8,640 | | |

| Non‑current portion of finance leases and other financing (in millions) | | | ($) | | | 56 | | | 76 | | | 69 | | | 91 | | | 110 | | |

| Cash dividends declared per common share | | | ($) | | | 1.63 | | | 1.53 | | | 1.43 | | | 1.33 | | | 1.24 | | |

| Market price of common stock at year-end | | | ($) | | | 61.01 | | | 62.84 | | | 49.65 | | | 47.30 | | | 41.62 | | |

| Book value per common share at year-end | | | ($) | | | 19.02 | | | 17.67 | | | 16.78 | | | 15.77 | | | 15.23 | | |

| Total employees at year-end | | | | | | 8,837 | | | 8,789 | | | 8,625 | | | 7,952 | | | 7,800 | | |

| Electric Utility Statistics | | | | | | | | | | | | | | | | | | | | |

| Sales (billions of kWh) | | | | | | 35 | | | 37 | | | 38 | | | 37 | | | 38 | | |

| Customers (in thousands) | | | | | | 1,866 | | | 1,848 | | | 1,831 | | | 1,826 | | | 1,805 | | |

| Average sales rate per kWh | | | (¢) | | | 11.74 | | | 11.64 | | | 11.78 | | | 11.98 | | | 11.63 | | |

| Gas Utility Statistics | | | | | | | | | | | | | | | | | | | | |

| Sales and transportation deliveries (bcf) | | | | | | 360 | | | 391 | | | 386 | | | 352 | | | 358 | | |

| Customers (in thousands)1 | | | | | | 1,804 | | | 1,793 | | | 1,784 | | | 1,776 | | | 1,772 | | |

| Average sales rate per mcf | | | ($) | | | 7.60 | | | 7.44 | | | 7.44 | | | 7.51 | | | 7.31 | | |

1Excludes off-system transportation customers.

Consumers Energy Company

| Operating revenue (in millions) | | | ($) | | | 6,189 | | | 6,376 | | | 6,464 | | | 6,222 | | | 6,064 | | |

| Net income (in millions) | | | ($) | | | 816 | | | 743 | | | 705 | | | 632 | | | 616 | | |

| Net income available to common stockholder (in millions) | | | ($) | | | 814 | | | 741 | | | 703 | | | 630 | | | 614 | | |

| Cash provided by operations (in millions) | | | ($) | | | 1,218 | | | 1,601 | | | 1,449 | | | 1,715 | | | 1,681 | | |

| Capital expenditures, excluding assets placed under finance lease (in millions) | | | ($) | | | 2,170 | | | 2,085 | | | 1,822 | | | 1,632 | | | 1,656 | | |

| Total assets (in millions) | | | ($) | | | 25,399 | | | 23,699 | | | 22,025 | | | 21,099 | | | 19,946 | | |

| Long-term debt, excluding current portion (in millions) | | | ($) | | | 7,742 | | | 7,048 | | | 6,779 | | | 5,561 | | | 5,253 | | |

| Total preferred stock (in millions) | | | ($) | | | 37 | | | 37 | | | 37 | | | 37 | | | 37 | | |

| [CMS Energy Consolidated Financial [removed: Statements](#ibe111af6d52149569b23f8b48d5770c6_82)] [added: Statements](#i801264ff445748f994f9556d2f07e0a4_205)] | | | | | | [removed: [92](#ibe111af6d52149569b23f8b48d5770c6_82)] [added: [88](#i801264ff445748f994f9556d2f07e0a4_205)] | | |

| [Consolidated Statements of [removed: Income](#ibe111af6d52149569b23f8b48d5770c6_85)] [added: Income](#i801264ff445748f994f9556d2f07e0a4_208)] | | | | | | [removed: [92](#ibe111af6d52149569b23f8b48d5770c6_85)] [added: [88](#i801264ff445748f994f9556d2f07e0a4_208)] | | |

| [Consolidated Statements of Comprehensive [removed: Income](#ibe111af6d52149569b23f8b48d5770c6_88)] [added: Income](#i801264ff445748f994f9556d2f07e0a4_211)] | | | | | | [removed: [93](#ibe111af6d52149569b23f8b48d5770c6_88)] [added: [90](#i801264ff445748f994f9556d2f07e0a4_211)] | | |

| [Consolidated Statements of Cash [removed: Flows](#ibe111af6d52149569b23f8b48d5770c6_94)] [added: Flows](#i801264ff445748f994f9556d2f07e0a4_214)] | | | | | | [removed: [94](#ibe111af6d52149569b23f8b48d5770c6_94)] [added: [92](#i801264ff445748f994f9556d2f07e0a4_214)] | | |

| [Consolidated Balance [removed: Sheets](#ibe111af6d52149569b23f8b48d5770c6_97)] [added: Sheets](#i801264ff445748f994f9556d2f07e0a4_217)] | | | | | | [removed: [96](#ibe111af6d52149569b23f8b48d5770c6_97)] [added: [94](#i801264ff445748f994f9556d2f07e0a4_217)] | | |

| [Consolidated Statements of Changes in [removed: Equity](#ibe111af6d52149569b23f8b48d5770c6_103)] [added: Equity](#i801264ff445748f994f9556d2f07e0a4_220)] | | | | | | [removed: [98](#ibe111af6d52149569b23f8b48d5770c6_103)] [added: [96](#i801264ff445748f994f9556d2f07e0a4_220)] | | |

| [Consumers Consolidated Financial [removed: Statements](#ibe111af6d52149569b23f8b48d5770c6_109)] [added: Statements](#i801264ff445748f994f9556d2f07e0a4_223)] | | | | | | [removed: [100](#ibe111af6d52149569b23f8b48d5770c6_109)] [added: [98](#i801264ff445748f994f9556d2f07e0a4_223)] | | |

| [Consolidated Statements of Comprehensive [removed: Income](#ibe111af6d52149569b23f8b48d5770c6_115)] [added: Income](#i801264ff445748f994f9556d2f07e0a4_229)] | | | | | | [removed: [101](#ibe111af6d52149569b23f8b48d5770c6_115)] [added: [99](#i801264ff445748f994f9556d2f07e0a4_229)] | | |

| [Consolidated Statements of Cash [removed: Flows](#ibe111af6d52149569b23f8b48d5770c6_121)] [added: Flows](#i801264ff445748f994f9556d2f07e0a4_232)] | | | | | | [removed: [102](#ibe111af6d52149569b23f8b48d5770c6_121)] [added: [100](#i801264ff445748f994f9556d2f07e0a4_232)] | | |

| [Consolidated Statements of Changes in [removed: Equity](#ibe111af6d52149569b23f8b48d5770c6_130)] [added: Equity](#i801264ff445748f994f9556d2f07e0a4_238)] | | | | | | [removed: [106](#ibe111af6d52149569b23f8b48d5770c6_130)] [added: [104](#i801264ff445748f994f9556d2f07e0a4_238)] | | |

| [Notes to the Consolidated Financial [removed: Statements](#ibe111af6d52149569b23f8b48d5770c6_136)] [added: Statements](#i801264ff445748f994f9556d2f07e0a4_241)] | | | | | | [removed: [107](#ibe111af6d52149569b23f8b48d5770c6_136)] [added: [105](#i801264ff445748f994f9556d2f07e0a4_241)] | | |

[removed: | [3:](#ibe111af6d52149569b23f8b48d5770c6_148) | | | [Regulatory Matters](#ibe111af6d52149569b23f8b48d5770c6_148) | | | [111](#ibe111af6d52149569b23f8b48d5770c6_148) | | |][added: 2: Regulatory Matters]

[removed: | [4:](#ibe111af6d52149569b23f8b48d5770c6_154) | | | [Contingencies] [added: 3: Contingencies] and [removed: Commitments](#ibe111af6d52149569b23f8b48d5770c6_154) | | | [117](#ibe111af6d52149569b23f8b48d5770c6_154) | | |][added: Commitments]

[removed: | [5:](#ibe111af6d52149569b23f8b48d5770c6_160) | | | [Financings] [added: 4: Financings] and [removed: Capitalization](#ibe111af6d52149569b23f8b48d5770c6_160) | | | [124](#ibe111af6d52149569b23f8b48d5770c6_160) | | |][added: Capitalization]

[removed: | [6:](#ibe111af6d52149569b23f8b48d5770c6_166) | | | [Fair] [added: 5: Fair] Value [removed: Measurements](#ibe111af6d52149569b23f8b48d5770c6_166) | | | [131](#ibe111af6d52149569b23f8b48d5770c6_166) | | |][added: Measurements]

[removed: | [7:](#ibe111af6d52149569b23f8b48d5770c6_169) | | | [Financial Instruments](#ibe111af6d52149569b23f8b48d5770c6_169) | | | [134](#ibe111af6d52149569b23f8b48d5770c6_169) | | |][added: 6: Financial Instruments]

[removed: | [9:](#ibe111af6d52149569b23f8b48d5770c6_178) | | | [Plant,] [added: 7: Plant,] Property, and [removed: Equipment](#ibe111af6d52149569b23f8b48d5770c6_178) | | | [138](#ibe111af6d52149569b23f8b48d5770c6_178) | | |][added: Equipment]

[removed: | [10:](#ibe111af6d52149569b23f8b48d5770c6_184) | | | [Leases] [added: 8: Leases] and Palisades [removed: Financing](#ibe111af6d52149569b23f8b48d5770c6_184) | | | [142](#ibe111af6d52149569b23f8b48d5770c6_184) | | |][added: Financing]

[removed: | [11:](#ibe111af6d52149569b23f8b48d5770c6_190) | | | [Asset] [added: 9: Asset] Retirement [removed: Obligations](#ibe111af6d52149569b23f8b48d5770c6_190) | | | [147](#ibe111af6d52149569b23f8b48d5770c6_190) | | |][added: Obligations]

[removed: | [12:](#ibe111af6d52149569b23f8b48d5770c6_193) | | | [Retirement Benefits](#ibe111af6d52149569b23f8b48d5770c6_193) | | | [149](#ibe111af6d52149569b23f8b48d5770c6_193) | | |][added: 10: Retirement Benefits]

[removed: | [13:](#ibe111af6d52149569b23f8b48d5770c6_199) | | | [Stock-Based Compensation](#ibe111af6d52149569b23f8b48d5770c6_199) | | | [159](#ibe111af6d52149569b23f8b48d5770c6_199) | | |][added: 11: Stock-Based Compensation]

[removed: | [14:](#ibe111af6d52149569b23f8b48d5770c6_205) | | | [Income Taxes](#ibe111af6d52149569b23f8b48d5770c6_205) | | | [163](#ibe111af6d52149569b23f8b48d5770c6_205) | | |][added: 12: Income Taxes]

[removed: | [15:](#ibe111af6d52149569b23f8b48d5770c6_211) | | | [Earnings] [added: 13: Earnings] Per Share—CMS [removed: Energy](#ibe111af6d52149569b23f8b48d5770c6_211) | | | [167](#ibe111af6d52149569b23f8b48d5770c6_211) | | |][added: Energy]

[removed: | [17:](#ibe111af6d52149569b23f8b48d5770c6_220) | | | [Other] [added: 15: Other] Income and Other [removed: Expense](#ibe111af6d52149569b23f8b48d5770c6_220) | | | [172](#ibe111af6d52149569b23f8b48d5770c6_220) | | |][added: Expense]

| [removed: [18:](#ibe111af6d52149569b23f8b48d5770c6_223)] [added: Cash and cash equivalents] | | | [removed: [Cash and Cash Equivalents](#ibe111af6d52149569b23f8b48d5770c6_223)] | | | [removed: [172](#ibe111af6d52149569b23f8b48d5770c6_223)] [added: $] | [added: 22] | | [added: | | | $ | 20 | |]

[removed: | [19:](#ibe111af6d52149569b23f8b48d5770c6_226) | | | [Reportable Segments](#ibe111af6d52149569b23f8b48d5770c6_226) | | | [173](#ibe111af6d52149569b23f8b48d5770c6_226) | | |][added: 17: Reportable Segments]

[removed: | [20:](#ibe111af6d52149569b23f8b48d5770c6_229) | | | [Related-Party Transactions—Consumers](#ibe111af6d52149569b23f8b48d5770c6_229) | | | [177](#ibe111af6d52149569b23f8b48d5770c6_229) | | |][added: 18: Related-Party Transactions—Consumers]

[removed: | [21:](#ibe111af6d52149569b23f8b48d5770c6_235) | | | [Variable] [added: 19: Variable] Interest [removed: Entities](#ibe111af6d52149569b23f8b48d5770c6_235) | | | [178](#ibe111af6d52149569b23f8b48d5770c6_235) | | |][added: Entities]

[removed: | [23:](#ibe111af6d52149569b23f8b48d5770c6_244) | | | [Quarterly] [added: 21: Quarterly] Financial and Common Stock Information [removed: (Unaudited)](#ibe111af6d52149569b23f8b48d5770c6_244) | | | [181](#ibe111af6d52149569b23f8b48d5770c6_244) | | |][added: (Unaudited)]

| [Reports of Independent Registered Public Accounting [removed: Firm](#ibe111af6d52149569b23f8b48d5770c6_247)] [added: Firm (PCAOB ID](#i801264ff445748f994f9556d2f07e0a4_409) 238[)](#i801264ff445748f994f9556d2f07e0a4_409)] | | | | | | [removed: [182](#ibe111af6d52149569b23f8b48d5770c6_247)] [added: [178](#i801264ff445748f994f9556d2f07e0a4_409)] | | |

| [removed: [CMS Energy](#ibe111af6d52149569b23f8b48d5770c6_247)] [added: CMS Energy] | | | | | | [removed: [182](#ibe111af6d52149569b23f8b48d5770c6_247)] | | | [added: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |]

| *In Millions, Except Per Share Amounts* | | | | | | | | | | | | | | | | | | | | | [added: | | | | | | | | | | | | | | |]

| Years Ended December 31 | | | [added: | | | | | | | | | 2021 | | | | | |] 2020 | | | | | | 2019 | | | | | | [removed: 2018] | | | | | |

| Operating Expenses | | | | | | | | | | | | | | | | | | | | | [added: | | | | | | | | | | | | | | |]

| Fuel for electric generation | | | | | | [removed: 375] | | | | | | [removed: 493] | | | | | | [removed: 528] | | | [added: 593 | | | | | | 375 | | | | | | 493 | | |]

| Purchased and interchange power | | | | | | [removed: 1,492] | | | | | | [removed: 1,496] | | | | | | [removed: 1,613] | | | [added: 1,665 | | | | | | 1,492 | | | | | | 1,496 | | |]

| Purchased power – related parties | | | | | | [removed: 64] | | | | | | [removed: 75] | | | | | | [removed: 81] | | | [added: 77 | | | | | | 64 | | | | | | 75 | | |]

| Cost of gas sold | | | | | | [removed: 577] | | | | | | [removed: 769] | | | | | | [removed: 836] | | | [added: 735 | | | | | | 577 | | | | | | 769 | | |]

| Maintenance and other operating expenses | | | | | | [removed: 1,403] | | | | | | [removed: 1,448] | | | | | | [removed: 1,417] | | | [added: 1,610 | | | | | | 1,280 | | | | | | 1,356 | | |]

| Other Income (Expense) | | | | | | | | | | | | | | | | | | | | | [added: | | | | | | | | | | | | | | |]

| [Consolidated Statements of Income](#i801264ff445748f994f9556d2f07e0a4_226) | | | | | | [98](#i801264ff445748f994f9556d2f07e0a4_226) | | |

| [Consolidated Balance Sheets](#i801264ff445748f994f9556d2f07e0a4_235) | | | | | | [102](#i801264ff445748f994f9556d2f07e0a4_235) | | |

| [1:](#i801264ff445748f994f9556d2f07e0a4_247) | | | [Significant Accounting Policies](#i801264ff445748f994f9556d2f07e0a4_247) | | | [105](#i801264ff445748f994f9556d2f07e0a4_247) | | |

| [3:](#i801264ff445748f994f9556d2f07e0a4_259) | | | [Contingencies and Commitments](#i801264ff445748f994f9556d2f07e0a4_259) | | | [114](#i801264ff445748f994f9556d2f07e0a4_259) | | |

| [8:](#i801264ff445748f994f9556d2f07e0a4_307) | | | [Leases and Palisades Financing](#i801264ff445748f994f9556d2f07e0a4_307) | | | [133](#i801264ff445748f994f9556d2f07e0a4_307) | | |

| [10:](#i801264ff445748f994f9556d2f07e0a4_316) | | | [Retirement Benefits](#i801264ff445748f994f9556d2f07e0a4_316) | | | [140](#i801264ff445748f994f9556d2f07e0a4_316) | | |

| [14:](#i801264ff445748f994f9556d2f07e0a4_352) | | | [Revenue](#i801264ff445748f994f9556d2f07e0a4_352) | | | [160](#i801264ff445748f994f9556d2f07e0a4_352) | | |

| [15:](#i801264ff445748f994f9556d2f07e0a4_370) | | | [Other Income and Other Expense](#i801264ff445748f994f9556d2f07e0a4_370) | | | [164](#i801264ff445748f994f9556d2f07e0a4_370) | | |

| [16:](#i801264ff445748f994f9556d2f07e0a4_373) | | | [Cash and Cash Equivalents](#i801264ff445748f994f9556d2f07e0a4_373) | | | [164](#i801264ff445748f994f9556d2f07e0a4_373) | | |

| [20:](#i801264ff445748f994f9556d2f07e0a4_403) | | | [Exit Activities and Discontinued Operations](#i801264ff445748f994f9556d2f07e0a4_403) | | | [172](#i801264ff445748f994f9556d2f07e0a4_403) | | |

| [CMS Energy](#i801264ff445748f994f9556d2f07e0a4_409) | | | | | | [178](#i801264ff445748f994f9556d2f07e0a4_409) | | |

| [Consumers](#i801264ff445748f994f9556d2f07e0a4_412) | | | | | | [182](#i801264ff445748f994f9556d2f07e0a4_412) | | |

| Operating Revenue | | | | | | | | | | | | | | | | | | | | | $ | 7,329 | | | | | $ | 6,418 | | | | | $ | 6,624 | |

| Depreciation and amortization | | | | | | | | | | | | | | | | | | | | | 1,114 | | | | | | 1,043 | | | | | | 989 | | |

| General taxes | | | | | | | | | | | | | | | | | | | | | 389 | | | | | | 357 | | | | | | 331 | | |

| Total operating expenses | | | | | | | | | | | | | | | | | | | | | 6,183 | | | | | | 5,188 | | | | | | 5,509 | | |

| Operating Income | | | | | | | | | | | | | | | | | | | | | 1,146 | | | | | | 1,230 | | | | | | 1,115 | | |

| Total interest charges | | | | | | | | | | | | | | | | | | | | | 500 | | | | | | 505 | | | | | | 460 | | |

| Income Before Income Taxes | | | | | | | | | | | | | | | | | | | | | 823 | | | | | | 809 | | | | | | 764 | | |

| Income From Continuing Operations | | | | | | | | | | | | | | | | | | | | | 728 | | | | | | 694 | | | | | | 633 | | |

| Income From Discontinued Operations, Net of Tax of $170, $18, and $16 | | | | | | | | | | | | | | | | | | | | | 602 | | | | | | 58 | | | | | | 49 | | |

| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |

| *In Millions, Except Per Share Amounts* | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

| Income from continuing operations per average common share available to common stockholders | | | | | | | | | | | | | | | | | | | | | $ | 2.58 | | | | | $ | 2.45 | | | | | $ | 2.23 | |

| Income from discontinued operations per average common share available to common stockholders | | | | | | | | | | | | | | | | | | | | | 2.08 | | | | | | 0.20 | | | | | | 0.17 | | |

| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

| Income from continuing operations per average common share available to common stockholders | | | | | | | | | | | | | | | | | | | | | $ | 2.58 | | | | | $ | 2.44 | | | | | 2.22 | | |

| Income from discontinued operations per average common share available to common stockholders | | | | | | | | | | | | | | | | | | | | | 2.08 | | | | | | 0.20 | | | | | | 0.17 | | |

| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |

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| | | | | | | | | |

| --- | --- | --- | --- | --- | --- | --- | --- | --- |

| [Consolidated Statements of Income](#ibe111af6d52149569b23f8b48d5770c6_112) | | | | | | [100](#ibe111af6d52149569b23f8b48d5770c6_112) | | |

| [Consolidated Balance Sheets](#ibe111af6d52149569b23f8b48d5770c6_124) | | | | | | [104](#ibe111af6d52149569b23f8b48d5770c6_124) | | |

| [1:](#ibe111af6d52149569b23f8b48d5770c6_139) | | | [Significant Accounting Policies](#ibe111af6d52149569b23f8b48d5770c6_139) | | | [107](#ibe111af6d52149569b23f8b48d5770c6_139) | | |

| [2:](#ibe111af6d52149569b23f8b48d5770c6_142) | | | [New Accounting Standards](#ibe111af6d52149569b23f8b48d5770c6_142) | | | [110](#ibe111af6d52149569b23f8b48d5770c6_142) | | |

| [8:](#ibe111af6d52149569b23f8b48d5770c6_175) | | | [Notes Receivable](#ibe111af6d52149569b23f8b48d5770c6_175) | | | [135](#ibe111af6d52149569b23f8b48d5770c6_175) | | |

| [16:](#ibe111af6d52149569b23f8b48d5770c6_214) | | | [Revenue](#ibe111af6d52149569b23f8b48d5770c6_214) | | | [168](#ibe111af6d52149569b23f8b48d5770c6_214) | | |

| [22:](#ibe111af6d52149569b23f8b48d5770c6_241) | | | [Asset Sale and Exit Activities](#ibe111af6d52149569b23f8b48d5770c6_241) | | | [180](#ibe111af6d52149569b23f8b48d5770c6_241) | | |

| [Consumers](#ibe111af6d52149569b23f8b48d5770c6_250) | | | | | | [186](#ibe111af6d52149569b23f8b48d5770c6_250) | | |

| | | | | | | | | | | | | | | | | | | | | |

| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |

| Operating Revenue | | | | | | $ | 6,680 | | | | | $ | 6,845 | | | | | $ | 6,873 | |

| Depreciation and amortization | | | | | | 1,048 | | | | | | 992 | | | | | | 933 | | |

| General taxes | | | | | | 359 | | | | | | 333 | | | | | | 303 | | |

| Total operating expenses | | | | | | 5,318 | | | | | | 5,606 | | | | | | 5,711 | | |

| Operating Income | | | | | | 1,362 | | | | | | 1,239 | | | | | | 1,162 | | |

| Total interest charges | | | | | | 561 | | | | | | 519 | | | | | | 458 | | |

| Increase in EnerBank notes receivable | | | | | | (657) | | | | | | (401) | | | | | | (307) | | |

| Purchase of notes receivable by EnerBank | | | | | | (17) | | | | | | (343) | | | | | | (225) | | |

| Proceeds from DB SERP investments | | | | | | — | | | | | | — | | | | | | 146 | | |

| Increase in EnerBank certificates of deposit | | | | | | 416 | | | | | | 631 | | | | | | 513 | | |

| | | | | | | | | | | | | | | |

| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |

| Other | | | | | | 869 | | | | | | 739 | | |

| Accrued taxes | | | | | | 457 | | | | | | 437 | | |

| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |

| Retained Earnings (Accumulated Deficit) | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

| Cumulative effect of change in accounting principle | | | | | | | | | | | | | | | (51) | | | | | | — | | | | | | 8 | | |

| Investments | | | | | | | | | | | | | | | | | | | | |

| Unrealized loss on investments, net of tax of $— for all periods | | | | | | — | | | | | | — | | | | | | (1) | | |

| Reclassification adjustments included in net income, net of tax of $— for all periods | | | | | | — | | | | | | — | | | | | | 1 | | |

| Proceeds from DB SERP investments | | | | | | — | | | | | | — | | | | | | 106 | | |

| Cumulative effect of change in accounting principle | | | | | | | | | | | | | | | | | | | | | — | | | | | | — | | | | | | (5) | | |

| *Investments* | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

| Cumulative effect of change in accounting principle | | | | | | | | | | | | | | | | | | | | | — | | | | | | — | | | | | | (12) | | |

| Unrealized loss on investments | | | | | | | | | | | | | | | | | | | | | — | | | | | | — | | | | | | (1) | | |

| Reclassification adjustments included in net income | | | | | | | | | | | | | | | | | | | | | — | | | | | | — | | | | | | 1 | | |

| Cumulative effect of change in accounting principle | | | | | | | | | | | | | | | | | | | | | — | | | | | | — | | | | | | 19 | | |

Based on such evaluation, CMS Energy’s CEO and CFO have concluded that its disclosure controls and procedures were effective as of December 31, [removed: 2020.][added: 2021.]

Under the supervision and with the participation of management, including its CEO and CFO, CMS Energy conducted an evaluation of the effectiveness of its internal control over financial reporting as of December 31, [removed: 2020.][added: 2021.]

Based on such evaluation, CMS Energy’s management concluded that its internal control over financial reporting was effective as of December 31, [removed: 2020.][added: 2021.]

The effectiveness of CMS Energy’s internal control over financial reporting as of December 31, [removed: 2020] [added: 2021] has

Changes in Internal Control [removed: over] [added: Over] Financial Reporting: There have [added: not] been [removed: no] [added: any] changes in CMS Energy’s internal control over financial reporting during the [removed: most recently completed] [added: last] fiscal quarter that have materially affected, or are reasonably likely to affect materially, its internal control over financial reporting.

Based on such evaluation, Consumers’ CEO and CFO have concluded that its disclosure controls and procedures were effective as of December 31, [removed: 2020.][added: 2021.]

Under the supervision and with the participation of management, including its CEO and CFO, Consumers conducted an evaluation of the effectiveness of its internal control over financial reporting as of December 31, [removed: 2020.][added: 2021.]

Based on such evaluation, Consumers’ management concluded that its internal control over financial reporting was effective as of December 31, [removed: 2020.][added: 2021.]

The effectiveness of Consumers’ internal control over financial reporting as of December 31, [removed: 2020] [added: 2021] has been audited by PricewaterhouseCoopers LLP, an independent registered public accounting firm, as stated in their report which appears under Item 8.

Changes in Internal Control [removed: over] [added: Over] Financial Reporting: There have [added: not] been [removed: no] [added: any] changes in Consumers’ internal control over financial reporting during the [removed: most recently completed] [added: last] fiscal quarter that have materially affected, or are reasonably likely to affect materially, its internal control over financial reporting.

Part III

Not applicable.

Part III

Information that is required in Item 10 of this Form 10‑K regarding directors, executive officers, and corporate governance is incorporated by reference from CMS Energy’s and Consumers’ definitive proxy statement for their [removed: 2021] [added: 2022] Annual Meetings of Shareholders to be held May [removed: 7, 2021.][added: 6, 2022.]

CMS Energy has adopted an employee code of ethics, entitled “CMS Energy [removed: 2021] [added: 2022] Code of [removed: Conduct”] [added: Conduct and Guide to Ethical Business Behavior”] (“Employee Code”) that applies to its CEO, CFO, and CAO, as well as all other officers and employees of CMS Energy and its [removed: affiliates, except for EnerBank, which has its own code of conduct.][added: affiliates.]

CMS Energy has also adopted a director code of ethics entitled [removed: “2021] [added: “2022] Board of Directors Code of [removed: Conduct”] [added: Conduct and Guide to Ethical Business Behavior”] (“Director Code”) that applies to its directors.

Consumers has adopted an employee code of ethics, entitled “CMS Energy [removed: 2021] [added: 2022] Code of [removed: Conduct”] [added: Conduct and Guide to Ethical Business Behavior”] (“Employee Code”) that applies to its CEO, CFO, and CAO, as well as all other officers and employees of Consumers and its [removed: affiliates, except for EnerBank, which has its own code of conduct.][added: affiliates.]

Consumers has also adopted a director code of ethics entitled [removed: “2021] [added: “2022] Board of Directors Code of [removed: Conduct”] [added: Conduct and Guide to Ethical Business Behavior”] (“Director Code”) that applies to its directors.

Information that is required in Item 10 of this Form 10‑K regarding directors, executive officers, and corporate governance is incorporated by reference from CMS Energy’s and Consumers’ definitive proxy statement for their 2022 Annual Meetings of Shareholders to be held May 6, 2022.

Presented in the following table is information regarding CMS Energy’s equity compensation plans as of December 31, [removed: 2020:][added: 2021:]

| Equity compensation plan approved by shareholders | | | — | | | | | | $ | — | | [removed: 6,477,579] [added: 5,927,297] | | |

NOTE: Information that is required by Part III—Items 11, 12, 13, and 14 of this Form 10‑K is incorporated by reference from CMS Energy’s and Consumers’ definitive proxy statement for their [removed: 2021] [added: 2022] Annual Meetings of Shareholders to be held May [removed: 7, 2021.][added: 6, 2022.]

- Consolidated Statements of Income of CMS Energy for the years ended December 31, [added: 2021,] 2020, [removed: 2019,] and [removed: 2018][added: 2019]

- Consolidated Statements of Comprehensive Income of CMS Energy for the years ended December 31, [added: 2021,] 2020, [removed: 2019,] and [removed: 2018][added: 2019]

- Consolidated Statements of Cash Flows of CMS Energy for the years ended December 31, [added: 2021,] 2020, [removed: 2019,] and [removed: 2018][added: 2019]

- Consolidated Balance Sheets of CMS Energy at December 31, [removed: 2020] [added: 2021] and [removed: 2019][added: 2020]

- Consolidated Statements of Changes in Equity of CMS Energy for the years ended December 31, [added: 2021,] 2020, [removed: 2019,] and [removed: 2018][added: 2019]

- Consolidated Statements of Income of Consumers for the years ended December 31, [added: 2021,] 2020, [removed: 2019,] and [removed: 2018][added: 2019]

- Consolidated Statements of Comprehensive Income of Consumers for the years ended December 31, [added: 2021,] 2020, [removed: 2019,] and [removed: 2018][added: 2019]

- Consolidated Statements of Cash Flows of Consumers for the years ended December 31, [added: 2021,] 2020, [removed: 2019,] and [removed: 2018][added: 2019]

- Consolidated Balance Sheets of Consumers at December 31, [removed: 2020] [added: 2021] and [removed: 2019][added: 2020]

- Consolidated Statements of Changes in Equity of Consumers for the years ended December 31, [added: 2021,] 2020, [removed: 2019,] and [removed: 2018][added: 2019]

- Schedule I — Condensed Financial Information of Registrant, CMS Energy—Parent Company at December 31, [removed: 2020] [added: 2021] and [removed: 2019] [added: 2020] and for the years ended December 31, [added: 2021,] 2020, [removed: 2019,] and [removed: 2018][added: 2019]

- Schedule II — Valuation and Qualifying Accounts and Reserves of CMS Energy for the years ended December 31, [added: 2021,] 2020, [removed: 2019,] and [removed: 2018][added: 2019]

- Schedule II — Valuation and Qualifying Accounts and Reserves of Consumers for the years ended December 31, [added: 2021,] 2020, [removed: 2019,] and [removed: 2018][added: 2019]

| Years Ended December 31 | | | [removed: 2020] [added: 2021] | | | | | | [removed: 2019] [added: 2020] | | | | | | [removed: 2018] [added: 2019] | | | | | |

| Other operating expenses | | | | | | $ | [removed: (6)] [added: (7)] | | | | | $ | [removed: (38)] [added: (6)] | | | | | $ | [removed: (7)] [added: (38)] | |

| Total operating expenses | | | | | | [removed: (6)] [added: (7)] | | | | | | [removed: (38)] [added: (6)] | | | | | | [removed: (7)] [added: (38)] | | |

| Operating Loss | | | | | | [removed: (6)] [added: (7)] | | | | | | [removed: (38)] [added: (6)] | | | | | | [removed: (7)] [added: (38)] | | |

| Equity earnings of subsidiaries | | | | | | [removed: 909] [added: 1,482] | | | | | | [removed: 826] [added: 909] | | | | | | [removed: 780] [added: 826] | | |

| Interest income | | | | | | 1 | | | | | | 1 | | | | | | [removed: 2] [added: 1] | | |

| Other income | | | | | | 1 | | | | | | 1 | | | | | | [removed: —] [added: 1] | | |

| Other expense | | | | | | [removed: (19)] [added: —] | | | | | | [removed: —] [added: (19)] | | | | | | [removed: (17)] [added: —] | | |

| Total other income | | | | | | [removed: 891] [added: 1,483] | | | | | | [removed: 827] [added: 891] | | | | | | [removed: 764] [added: 827] | | |

| Interest on long-term debt | | | | | | [removed: 178] [added: 183] | | | | | | [removed: 156] [added: 178] | | | | | | [removed: 135] [added: 156] | | |

| Intercompany interest expense and other | | | | | | 7 | | | | | | [removed: 10] [added: 7] | | | | | | [removed: 7] [added: 10] | | |

| Total interest charges | | | | | | [removed: 185] [added: 190] | | | | | | [removed: 166] [added: 185] | | | | | | [removed: 142] [added: 166] | | |

| Income Before Income Taxes | | | | | | [removed: 700] [added: 1,286] | | | | | | [removed: 623] [added: 700] | | | | | | [removed: 615] [added: 623] | | |

| Income Tax Benefit | | | | | | [removed: (55)] [added: (60)] | | | | | | [removed: (57)] [added: (55)] | | | | | | [removed: (42)] [added: (57)] | | |

| Net Income Available to Common Stockholders | | | | | | $ | [removed: 755] [added: 1,348] | | | | | $ | [removed: 680] [added: 755] | | | | | $ | [removed: 657] [added: 680] | |

| Net cash provided by operating activities | | | | | | $ | [removed: 507] [added: 1,549] | | | | | $ | [removed: 697] [added: 507] | | | | | $ | [removed: 702] [added: 697] | |

| Investment in subsidiaries | | | | | | [removed: (657)] [added: (581)] | | | | | | [removed: (683)] [added: (657)] | | | | | | [removed: (363)] [added: (683)] | | |

| Increase in notes receivable – intercompany | | | | | | [removed: (307)] [added: (83)] | | | | | | [removed: —] [added: (307)] | | | | | | — | | |

| Net cash used in investing activities | | | | | | [removed: (964)] [added: (664)] | | | | | | [removed: (683)] [added: (964)] | | | | | | [removed: (341)] [added: (683)] | | |

| Proceeds from issuance of debt | | | | | | [removed: 1,225] [added: —] | | | | | | [removed: 1,158] [added: 1,225] | | | | | | [removed: 560] [added: 1,158] | | |

| Issuance of common stock | | | | | | [removed: 253] [added: 26] | | | | | | [removed: 12] [added: 253] | | | | | | [removed: 41] [added: 12] | | |

| Retirement of long-term debt | | | | | | [removed: (425)] [added: (200)] | | | | | | [removed: (738)] [added: (425)] | | | | | | [removed: (675)] [added: (738)] | | |

| Debt prepayment costs | | | | | | [removed: (16)] [added: —] | | | | | | [removed: —] [added: (16)] | | | | | | [removed: (16)] [added: —] | | |

| Payment of dividends on common [added: and preferred] stock | | | | | | [removed: (465)] [added: (507)] | | | | | | [removed: (434)] [added: (465)] | | | | | | [removed: (405)] [added: (434)] | | |

| Debt issuance costs and financing fees | | | | | | (10) | | | | | | [removed: (18)] [added: (10)] | | | | | | [removed: (8)] [added: (18)] | | |

| Change in notes payable – intercompany | | | | | | [removed: (105)] [added: (28)] | | | | | | [removed: 6] [added: (105)] | | | | | | [removed: 142] [added: 6] | | |

| Net cash provided by (used in) financing activities | | | | | | [removed: 457] [added: (495)] | | | | | | [removed: (14)] [added: 457] | | | | | | [removed: (361)] [added: (14)] | | |

| Income From Continuing Operations | | | | | | 1,346 | | | | | | 755 | | | | | | 680 | | |

| Income From Discontinued Operations, Net of Tax of $(5), $—, and $— | | | | | | 7 | | | | | | — | | | | | | — | | |

| Net Income Attributable to CMS Energy | | | | | | 1,353 | | | | | | 755 | | | | | | 680 | | |

| Preferred Stock Dividends | | | | | | 5 | | | | | | — | | | | | | — | | |

| | | | | | | | | | | | | | | | | | | | | |

| Issuance of preferred stock | | | | | | 224 | | | | | | — | | | | | | — | | |

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| | | | | | | | | | | | | | | | | | | | | |

| December 31 | | | 2021 | | | | | | 2020 | | | | | |

| Cash and cash equivalents | | | | | | $ | 390 | | | | | $ | — | |

| December 31 | | | 2021 | | | | | | 2020 | | | | | |

| Preferred stock | | | | | | 224 | | | | | | — | | |

| Total equity | | | | | | 6,631 | | | | | | 5,496 | | |

- to Regions Bank related to the sale of EnerBank

4: Preferred Stock

In 2021, CMS Energy issued 9.2 million depositary shares, each representing a 1/1,000th interest in a share of its cumulative Series C preferred stock, traded on the New York Stock Exchange under the symbol CMS PRC, at a price of $25.00 per depositary share.

The transaction resulted in net proceeds of $224 million, which was used for general corporate purposes.

Dividends on the preferred stock accumulate at an annual rate of 4.200 percent and are payable quarterly.

The Series C preferred stock has no maturity or mandatory redemption date and is not redeemable at the option of the holders.

CMS Energy may, at its option, redeem the Series C preferred stock, in whole or in part, at a price equal to $25,000 per share (equivalent to $25.00 per depositary share), plus accumulated and unpaid dividends, at any time on or after July 15, 2026.

The Series C preferred stock ranks senior to CMS Energy’s common stock with respect to dividend rights and distribution rights upon liquidation.

| 2021 | | | | | | $ | 29 | | | | | $ | 22 | | | | | $ | — | | | | | $ | 31 | | | | | $ | 20 | |

| 2021 | | | | | | $ | 1 | | | | | $ | 1 | | | | | $ | — | | | | | $ | — | | | | | $ | 2 | |

Years Ended December 31, 2021, 2020, and 2019

| 2021 | | | | | | $ | 29 | | | | | $ | 22 | | | | | $ | — | | | | | $ | 31 | | | | | $ | 20 | |

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| 4.1.dd | | | 1-5611 | | | 4.1 | | | — | | | [144th dated as of 8/12/21 (Form 8-K filed August 12, 2021)](http://www.sec.gov/Archives/edgar/data/201533/000110465921103837/tm2124714d1_ex4-1.htm) | | |

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| Proceeds from DB SERP investments | | | | | | — | | | | | | — | | | | | | 22 | | |

| Federal income tax receivable | | | | | | — | | | | | | 18 | | |

2: Contingencies

Gas Index Price Reporting Litigation: CMS Energy, along with CMS MST, CMS Field Services, Cantera Natural Gas, Inc., and Cantera Gas Company, were named as defendants in four class action lawsuits filed in Kansas, Missouri, and Wisconsin and one individual lawsuit filed in Kansas; these lawsuits arose as a result of alleged inaccurate natural gas price reporting to publications that report trade information.

Allegations included price-fixing conspiracies, restraint of trade, and artificial inflation of natural gas retail prices.

In 2016, CMS Energy entities reached a settlement with the plaintiffs in the Kansas and Missouri class action cases for an amount that was not material to CMS Energy.

In 2017, the federal district court approved the settlement.

In 2019, CMS Energy and the plaintiffs in the remaining Kansas individual lawsuit and the Wisconsin class action lawsuit engaged in settlement discussions and CMS Energy recorded a $30 million liability at December 31, 2019 as the probable estimate to settle the two cases.

The parties executed a settlement agreement in the Kansas case in February 2020, and that case is now complete.

In the Wisconsin case, a settlement agreement was approved in August 2020 and that case is now complete.

| 2018 | | | | | | 20 | | | | | | 29 | | | | | | — | | | | | | 29 | | | | | | 20 | | |

| 2018 | | | | | | 15 | | | | | | 2 | | | | | | — | | | | | | 9 | | | | | | 8 | | |

| Allowance for notes receivable1 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

| 2019 | | | | | | 24 | | | | | | 38 | | | | | | — | | | | | | 29 | | | | | | 33 | | |

| 2018 | | | | | | 20 | | | | | | 25 | | | | | | — | | | | | | 21 | | | | | | 24 | | |

2On January 1, 2020, in accordance with ASU 2016‑13*, Measurement of Credit Losses on Financial Instruments*, CMS Energy adjusted the allowance for loan losses associated with its notes receivable, recording an offsetting adjustment to retained earnings.

For further details, see Item 8.

Financial Statements and Supplementary Data—Notes to the Consolidated Financial Statements—Note 2, New Accounting Standards and Note 8, Notes Receivable.

| 4.61 | | | 1-9513 | | | 4.6 | | | — | | | [Description of CMS Energy Securities (Form 10-K for the fiscal year ended December 31, 2019)](http://www.sec.gov/Archives/edgar/data/201533/000081115620000004/ex4612312019.htm) | | |

| 10.131,2 | | | 1-9513 | | | 10.3 | | | — | | | [Annual CMS Enterprises Employee Incentive Compensation Plan as amended, effective as of December 1, 2019 (Form 10-Q for the quarterly period ended March 31, 2020)](http://www.sec.gov/Archives/edgar/data/201533/000081115620000007/ex10303312020.htm) | | |

| Date: | | | February [removed: 11, 2021] [added: 10, 2022] | | | | | | | | |

Pursuant to the requirements of the Securities Exchange Act of 1934, this Annual Report has been signed below by the following persons on behalf of CMS Energy Corporation and in the capacities indicated and on February [removed: 11, 2021.][added: 10, 2022.]

| /s/ [removed: Garrick J. Rochow] [added: Kurt L. Darrow] | | | | | | [removed: /s/ Kurt L. Darrow] | | |

| [removed: Garrick J. Rochow] [added: Kurt L. Darrow, Director] | | | | | | [removed: Kurt L. Darrow, Director] | | |

| (Principal Executive Officer) | | | | | | [removed: /s/ William D. Harvey] | | |

| [added: Garrick J. Rochow] | | | | | | William D. Harvey, Director | | |

| /s/ Rejji P. Hayes | | | | | | [removed: /s/ John G. Russell] | | |

| [removed: Rejji P. Hayes] | | | | | | John G. Russell, Director | | |

| Executive Vice President and Chief Financial Officer | | | | | | [added: /s/ Suzanne F. Shank] | | |

| | | | [removed: /s/] Suzanne F. [removed: Shank] [added: Shank, Director] | | | | | |

| (Principal Financial Officer) | | | | | | [removed: Suzanne F. Shank, Director] | | |

| /s/ [removed: Glenn P. Barba] [added: Scott B. McIntosh] | | | | | | Myrna M. Soto, Director | | |

| Vice President, Controller, and Chief Accounting Officer | | | | | | [removed: /s/ John G. Sznewajs] | | |

| [added: (Controller)] | | | [added: | | |] John G. Sznewajs, Director | | | [removed: | | |]

| [added: /s/ Jon E. Barfield] | | | | | | /s/ Ronald J. Tanski | | |

| [added: Jon E. Barfield, Director] | | | | | | Ronald J. Tanski, Director | | |

| Jon E. Barfield, Director | | | | | | [removed: Laura H. Wright,] [added: Ronald J. Tanski,] Director | | |

| /s/ Deborah H. Butler | | | | | | [added: /s/ Laura H. Wright] | | |

| Deborah H. Butler, Director | | | | | | [added: Laura H. Wright, Director] | | |

Pursuant to the requirements of the Securities Exchange Act of 1934, this Annual Report has been signed below by the following persons on behalf of Consumers Energy Company and in the capacities indicated and on February [removed: 11, 2021.][added: 10, 2022.]

| /s/ Garrick J. Rochow | | | | | | /s/ William D. Harvey | | |

| | | | | | | /s/ John G. Russell | | |

| Rejji P. Hayes | | | | | | | | |

| Scott B. McIntosh | | | | | | | | |

| | | | /s/ John G. Sznewajs | | | | | |

| Date: | | | February 10, 2022 | | | | | | | | |

| /s/ Garrick J. Rochow | | | | | | /s/ William D. Harvey | | |

| Garrick J. Rochow | | | | | | William D. Harvey, Director | | |

| (Principal Executive Officer) | | | | | | | | |

| | | | | | | /s/ John G. Russell | | |

| | | | | | | John G. Russell, Director | | |

| /s/ Rejji P. Hayes | | | | | | | | |

| Rejji P. Hayes | | | | | | | | |

| Executive Vice President and Chief Financial Officer | | | | | | /s/ Suzanne F. Shank | | |

| | | | Suzanne F. Shank, Director | | | | | |

| (Principal Financial Officer) | | | | | | | | |

| /s/ Scott B. McIntosh | | | | | | Myrna M. Soto, Director | | |

| Scott B. McIntosh | | | | | | | | |

| Vice President, Controller, and Chief Accounting Officer | | | | | | | | |

| | | | /s/ John G. Sznewajs | | | | | |

| (Controller) | | | | | | John G. Sznewajs, Director | | |

| /s/ Jon E. Barfield | | | | | | /s/ Ronald J. Tanski | | |

| | | | | | | | | |

| | | | | | | | | |

| /s/ Deborah H. Butler | | | | | | /s/ Laura H. Wright | | |

| Deborah H. Butler, Director | | | | | | Laura H. Wright, Director | | |

| | | | | | | | | |

| | | | | | | | | |

| /s/ Kurt L. Darrow | | | | | | | | |

| Kurt L. Darrow, Director | | | | | | | | |

| Glenn P. Barba | | | | | | | | |

| (Controller) | | | | | | | | |

| /s/ Jon E. Barfield | | | | | | /s/ Laura H. Wright | | |