EAGAN, Minn. — MISO said its cost of doing business is set to escalate within the next four years, spawning bigger operating budgets and heftier member dues.
According to its own estimates, MISO said its base operating expenses could range from $412 million to $447 million by 2028, reflecting a 5.4 to 7.2% compound annual growth.
By 2028, the tariff rate MISO charges to its members could be 56 cents to 68 cents/MWh. Currently, MISO’s tariff rate is 47 cents/MWh. The RTO assumed a flat load profile of 717 TWh to make its estimate.
MISO also said project investments and other operating expenses combined could add more than $100 million to its annual budgets over four years. CFO Melissa Brown said salaries, benefits and computer maintenance comprise nearly 80% of MISO’s cost structure today and are expected to rise. She said the RTO going forward will have little opportunity to reduce costs to make up for heightened expenses.
“The labor market for MISO remains tight. A lot of our staff is getting poached, especially our experienced staff,” Brown said during the Advisory Committee’s meeting June 26. “It’s a challenge.”
The RTO’s 2024 base operating budget stands at $357 million, though it estimates it likely will end the year $5 million underbudget because of a higher-than-expected employee vacancy rate and stiff competition for staff.
Brown said MISO is recruiting new college graduates, even with the understanding those employees may leave within three to five years.
Members asked whether the RTO is using longevity bonuses for its employees.
“Right now, on the benefits side, there is nothing we’re not considering,” Brown said with a laugh. She confirmed MISO offers retention bonuses.
