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Griddy Energy Settles With Texas, Freeing Customers From $ 9,000 In Electricity Bills During Freeze


Former customers of utility company Griddy Energy will not have to pay outstanding bills under a settlement announced Monday by Attorney General Ken Paxton.

Griddy Energy sold electricity to consumers at wholesale prices plus a monthly charge of $ 9.99. Its rates soared during the February freeze when state grid operators increased wholesale prices to $ 9,000 per megawatt hour, forcing some customers to thousands of dollars in bills.

The state sued Griddy, who filed for bankruptcy in March. The utility has confirmed a liquidation plan that waives claims against customers for charges incurred Feb. 15-19, when the price of $ 9,000 per megawatt hour for wholesale electricity was in effect. Texas Attorney General Ken Paxton said his office then began negotiations for a settlement.

“I am satisfied with the outcome of these negotiations, and I will continue to fight to protect the livelihoods of all who live in this great state,” Paxton said in a statement.

Texas was hit by historic snowfall and single-digit temperatures in an icy blast that swept through the deep south for days from February 14. At least 210 people have died in the frost, mostly from hypothermia after their electrical service went out and their heating was lost.

Prices began to climb as the arctic storm approached Texas and many generators shut down. Frozen natural gas wellheads halted fuel production and transportation; the cold also destroyed coal-fired power stations, a nuclear power station and temporarily froze wind turbines.

Griddy warned customers that they would face price increases and told them to try switching to another supplier. Those who didn’t have been hit with bills in the thousands of dollars.


Heat wave is straining Texas power grid

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Under the settlement, Griddy’s customers whose invoices are still unpaid will not have to pay them. Those who have paid their bills to Griddy will be able to apply to bankruptcy court, the attorney general’s office said. It was not immediately clear how many customers have already paid their bills.

“Usually, when a lot of consumers get ripped off, it’s very difficult for them to receive even a small percentage of what they’ve lost,” Richard Alderman, director, told CBS MoneyWatch. from the Center for Consumer Law at the University of Houston.

“For those who haven’t paid, it’s 100 cents on the dollar they saved,” he added. “But the question is how many people are in this group.”

Former Griddy clients who have paid inflated bills and want reimbursement should contact bankruptcy court and ask for proof of claim, or seek the help of a lawyer, Alderman said.

Texas Governor Greg Abbott, a Republican, blamed the February power outages on the Electric Reliability Council of Texas, which operates the grid responsible for providing electricity to most of the state. ERCOT the general manager was sacked and the three members of the Public Utility Commission which oversees the council have resigned.

The governor appointed new members of the commission and a new CEO of ERCOT was appointed. The legislature passed measures to strengthen the reliability of electrical service, which led Abbott to declare the grid faults corrected. However, ERCOT twice appealed in the spring for electricity users save energy, prompting Abbott to demand aggressive action from the Utilities Commission.

Irina Ivanova of CBS News contributed reporting.

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