Houston-based electric company Griddy has been hit with a class-action lawsuit seeking “monetary relief of over $1 billion” after a rash of customers reported astronomically high energy bills after last week’s winter storm, even as millions in the state went without power during the height of the deep freeze.
The lawsuit claims customers received electric bills as high as $17,000 after the winter storm, saying that amounted to price gouging by the company.
Griddy customers pay wholesale prices for electricity, with the price subject to shifts in demand—a much different system than the fixed-rate electricity prices essentially all other companies use for charging customers.
The massive spike in demand caused by an unprecedented strain on the state’s electric grid caused spot electricity prices to rise from $50 per megawatt hour pre-storm to $9,000 per megawatt hour, according to the lawsuit.
During the storm’s aftermath, Griddy encouraged customers to switch to a fixed-rate provider, but most customers could not immediately do so since companies were not accepting new customers at the time.
An email Forbes sent to Griddy for comment was met with an automatic reply saying the company would fight “for accountability into why prices were allowed to remain so high for so long” and explaining how customers can enroll in a deferred payment plan.
What We Don’t Know
It’s not clear if or how government plans to provide relief for impacted customers, though some officials have expressed a desire to do so.
29,000. That’s about how many customers Griddy has.
A historic winter storm and cold outbreak led to rolling blackouts across Texas last week, pushing the state’s electrical grid to the brink of total failure. The storm impacted much of the eastern U.S., but Texas took the brunt of the humanitarian impact as blackouts left millions in the state without access to electricity or heat during the record-breaking cold. The response to the storm and preparedness, or lack thereof, before the event have led to political debates about who is responsible and what should be done going forward.