CMS ENERGY CORP

On July 22, 2026, the CMS Energy Board of Directors approved a plan to divest certain renewable projects owned by NorthStar Clean Energy and to exit non-utility renewables development. The projects included in the planned divestiture are primarily non-Michigan-based renewable generation projects. CMS Energy has initiated a sales process for these renewable projects and is evaluating market information and potential indications of interest. CMS Energy expects to classify the related assets and liabilities as held for sale in the third quarter of 2026, as the held-for-sale criteria were not met as of June 30, 2026.

Upon classification of these assets as held-for-sale, the related disposal group would be required to be measured at the lower of carrying value or fair value less costs to sell. If the estimated fair value less costs to sell of the disposal group is less than its carrying value, impairment charges may be required and CMS Energy could record a material impairment charge in the third quarter of 2026. This impairment determination requires significant judgment and estimates, including assumptions regarding future cash flows, market conditions, power prices, discount rates, operating performance, transaction structure, expected proceeds from the sale process, and costs to sell. These estimates are inherently uncertain and may change.

CMS Energy expects to complete the divestment within 12 months, subject to negotiating contractual terms with a third party, which would then be subject to regulatory approvals and other customary closing conditions. If the divestiture is delayed, modified, or not completed on anticipated terms, or if market conditions for renewable energy assets deteriorate, additional impairment charges, valuation adjustments, or losses on disposition could be required.

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