MISO plans to spend $364.2 million throughout 2023, a 3.2% decrease from this year’s budget.
The RTO plans to spend $310.5 million in base operating expenses, $18.2 million in other operating expenses and $35.5 million in project investments, which include its ongoing effort to replace its market platform.
The Audit and Finance Committee of the MISO Board of Directors gave the preliminary budget unanimous support during a Tuesday teleconference. The full board will hold a vote on the proposed budget in early December.
The grid operator remains concerned about employee salary hikes it might have to institute. It intends to spend about $28 million in base operating expenses, a 10% increase over 2022 and said the increase is necessary to onboard more staff to safeguard reliability.
“A lot of these are intellectual efforts,” CFO Melissa Brown explained to board members. She said “wage pressures to attract the talent we need” remain a risk to staying within next year’s budget confines, noting “ripples” from upping salaries caused the most disruption to the 2022 budget. (See “High employee turnover concerns leadership,” MISO Board Week Briefs: Sept. 12-15, 2022.)
However, MISO said it can more than offset the additional spending with a 68% ($38.5 million) decrease in its other expenses category because of higher rates earning more interest income. Other operating expenses includes capital labor, capital interest and other income losses.
Brown said overall, the grid operator expects to collect a $0.44/MWh tariff rate from its members in 2023, lower than its $0.45/MWh rate in 2022.
Alliant Energy’s Mitch Myhre, who chairs the stakeholder-led Finance Subcommittee, said members are concerned over real-world pressures that could impact the 2023 budget. He said MISO could find itself spending $8 million more than expected if it continues to have difficulties maintaining its talent pool and called for staff to “actively manage” the situation.
“It is important that MISO is a judicious and conscientious steward of funds received from its members and remain vigilant against material budget increases or overages,” Myhre said.
