Home > Transmission Strategy > Insights > Transmission Inflation (white paper)

You must be logged in to download these resources. Please log in or register.

Transmission Inflation (white paper)

From 2018 through 2021, the average zonal network transmission rates (Schedule 9) within MISO rose by a compound annual growth rate (“CAGR”) of 9.6% per year compared to an average increase in the Consumer Price Index (“CPI”) of only 2.9% over that timeframe. Much of that increase occurred in 2021 when the MISO systemwide average zonal network rate rose by a stunning 17.7%1to $4.07 per kW/month compared to a CPI of 6.4%. In 2022, the MISO system average network rate rose by 5.2%2to $4.22 per kW/month whereas the CPI is currently running at 8.6% with core inflation at 6%,3levels not seen in four decades. The increases in MISO transmission rates over the years are from consistently high levels of transmission capital spending driven by numerous factors such as wind and solar development, NERC requirements, aging transmission facilities, and retirement of dispatchable power plants. As one transmission owner (“TO”) said, “every time you turn around, there is another reason to invest in transmission.” Now, there is another factor that can significantly raise transmission rates: inflation.

Read the details in our paper.