2026 MISO Capacity Auction Brings Relief After 2025’s Record Prices
MISO’s 2026-2027 capacity auction results are in, and businesses can breathe a little bit easier. Learn more about how 5.6 Gigawatts (GW) of new solar, battery storage, and gas additions are providing relief in capacity costs across all MISO zones.
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Key Takeaways
The Midcontinent Independent System Operator (MISO) is the grid operator that manages electricity across 15 states and the Canadian province of Manitoba. Each year, MISO holds a capacity auction to secure enough electricity supply to meet demand forecasts for the upcoming year. The 2026-2027 MISO capacity auction results show summer capacity prices dropping significantly compared to 2025’s record highs. New solar, gas, and battery storage additions outpaced demand growth, providing pricing relief for the current planning year.
Summer 2026 capacity prices cleared between $384.10 and $424.30/MW-day, a 36-42% decrease from 2025.
Fall and spring capacity prices also dropped significantly for the 2026-2027 planning year.
Winter MISO capacity prices rose by about 8% to $35.97/MW-day.
MISO’s peak load is projected to grow 35% by 2035, driven largely by data center development.
MISO must make sure new capacity additions keep pace with rapidly increasing electricity demand.
How the Latest MISO Capacity News Will Impact Your Business
While lower capacity prices are good news, they’re only one component of your commercial energy bill. Everything from supply costs and transmission fees to delivery charges and market conditions all play a role in your total energy costs. Businesses currently on default utility rates will likely feel this year’s relief more directly, since those rates adjust with market conditions. Businesses currently enrolled in a fixed-rate energy plan are shielded from changes in capacity costs until their contract renewal window.
How Does the MISO Capacity Market Work?
MISO capacity auctions take place each April to determine seasonal capacity prices for the upcoming planning year, June through May. First, MISO forecasts peak seasonal electricity demand and sets a reserve margin for extra grid reliability. Generators and demand response providers then register their available capacity, while utilities bid to cover any of their shortfalls. MISO then runs a competitive auction in each zone to match supply with its demand forecast. The results set each zone’s seasonal capacity costs for the coming year. If a MISO capacity zone has a tighter supply, it will typically clear at higher prices.
How to Protect Your Business from Capacity Price Swings
While you can’t control the market, you can still take control of your business’s energy costs. The right business energy strategy provides long-term savings and stability no matter how the market shifts. Below are a few proven strategies to protect your business’s budget.
Frequently Asked Questions About MISO Capacity Prices
Can MISO capacity prices change during the year?
Each year, the MISO Planning Resource Auction in April determines capacity prices for the entire year. New MISO capacity prices take effect on June 1 and last until the next capacity auction. Each season clears its own capacity price based on that season’s supply and demand, so MISO power prices can shift every three months.
How do extreme weather events affect MISO capacity markets?
Extreme weather conditions can cause a surge in electricity demand that goes beyond what the auction originally forecasted, putting additional strain on the grid. While auction prices are set in advance, weather conditions can still influence supply and demand in real-time. MISO has been raising winter and spring reserve margin targets to account for severe weather risks across its grid.
Who pays for MISO capacity costs?
Capacity costs are ultimately built into wholesale energy prices for utilities and retail energy providers. However, those costs eventually show up in business and residential electricity bills through increases in market prices or default utility rates. If capacity prices rise, suppliers often pass those costs on to consumers through rate adjustments.
Will lower capacity prices reduce my electricity bill?
It’s possible but not guaranteed. Capacity is just one of several important components of your commercial energy bill. While a drop in capacity prices doesn’t guarantee a lower energy bill, businesses with a proactive energy strategy are better positioned to capitalize on capacity market shifts.
Which states are included in the MISO energy market?
MISO oversees the electric grid across 15 U.S. states and the Canadian province of Manitoba. U.S. MISO capacity zones stretch from Louisiana and Mississippi in the South to Minnesota and the Dakotas in the north.
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