Lawsuit against Griddy’s power plan
CHAMBERS COUNTY, TX – A news report posted on texastribune.org reports that a resident from Chambers County, Texas, has filed a class-action lawsuit against her electricity service provider Griddy. The lawsuit alleges that the power company engaged in illegal price gouging during Texas’s winter storm state of emergency. Her suit is seeking “$1 billion in relief for affected customers.”
According to the plaintiff’s lawsuit, her residential electric utility bill jumped to $9,340 the week of the record-breaking winter storm. Her typical monthly power bill ranged from $200 to $250 per month. The victim stated in her lawsuit that Griddy drafted several payments from her bank account, and the company had drafted $1,200 before she was able to block Griddy from withdrawing more money from her bank account. She still owes Griddy several thousands of dollars.
For an extra $10 per month, Griddy charges its customers wholesale electricity rates. Griddy’s service is different from other power companies that offer a fixed-rate power plan, which offers a consistent kilowatt hourly rate regardless of market conditions.
Some customers are facing astronomical power bills reaching the tens of thousands of dollars due to a kilowatt price hike fueled by skyrocketing demand and a shortage of supply. Texans on variable rate plans, such as Griddy’s power plan, saw “immediate and alarmingly high prices.”
In response to rising demand, the Texas’ Public Utility Commission raised the wholesale electricity market price to $9 per kilowatt-hour, which is a 7,400% rate increase over the typical 12 cents per kilowatt-hour. The rate increase was supposed to motivate power generators to produce more electricity.
Griddy addressed the allegations of price gouging on its website and blamed the Public Utility Commission for the rate spikes. Griddy stated that they did not profit from energy rate increases. Griddy states that the company only charges the customers what they pay for power and does not mark up its price.
Griddy informed its 29,000 customers last week of the potential rate surges and encouraged its customers to move their electric service to another electric provider. Griddy is granting customers a deferred payment plan to spread the balance over a five-month period.
Governor Greg Abbott stated that “scaling back the power bills” will be a top priority. The state’s utility commission met on Sunday and created a regulation to temporarily prevent power companies from turning off the power to customers who do not or cannot pay their power bill.
The plaintiff’s class action lawsuit is one of the first class action lawsuits filed against the operator and was filed in the 133rd District Court of Harris County, Texas, on behalf of “all retail customers within the ERCOT Region who lost electric services or potable water services during the week of February 14, 2021 as a result of ERCOT’s failure to ensure adequate generating capacity.”
The Texas Supreme Court is currently hearing a case that will determine whether or not ERCOT will maintain its sovereign immunity, which shields the company from some civil lawsuits.
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