When a fiercely cold winter storm hit the Deep South last week, it left millions of Texans without power, in sub-zero temperatures, for dangerously long periods of time. An unknown but large number of residents – including children, the elderly, clinically vulnerable people and homeless people – died of carbon monoxide poisoning and hypothermia. Countless others have struggled to deal with broken pipes, rotten food and the misery of days without power, partly thanks to the state’s exclusively Texan approach to distributing power and partly to the failure of public officials to avert disaster. But even when the storm passed and temperatures rose above freezing, some Texans had another unpleasant surprise.
While most Texans were financially protected from the strong fluctuations in the state’s energy market, some obtained their power from companies that offered rates that fluctuate according to supply and demand. Some of these customers found themselves with impressively high energy bills of $ 3,000, $ 5,000, $ 10,000 and more, for just a few days of electricity. Many of these cases came from a small company in Houston called Griddy, which offers wholesale prices to customers (with a $ 10 monthly fee). This high-risk model generally allows customers to save money during months of low usage, usually including winter. But, as the New York Times noted, Griddy advised all of his 30,000 customers to switch to another supplier before the winter storm came. Many failed to do so in time.
There is hope for some of these customers. Texas Governor Greg Abbott said on Sunday that the state is looking for solutions and the state’s Public Service Commission has temporarily suspended the termination of customers for failure to pay their bills. The commission also ordered companies to suspend sending invoices or account estimates to customers “until we resolve the issues of how we are going to financially manage the situation we are in,” according to the Texas Tribune.
To get an idea of what it was like to be caught in this mess, Slate spoke to David Astrein, a Griddy customer and 36-year-old human resources director for a manufacturing company in Houston. This interview has been edited and condensed for clarity.
Slate: When did you realize something was wrong?
Astrein: Griddy was kind enough to send us a notice at 2:47 pm on the 13th, which was Saturday, to say, Hey, call another provider at 3pm today because we expect high prices. Well, it was after the window when I finally saw the email. On Monday, when we tried to call to switch providers, we found that there were waiting periods. We had several friends who tried to change and failed. They were telling them that you wouldn’t be able to change for 48 hours, 72 hours, five days. So, we said, “How bad can it really be?” It’s winter in Texas: it can’t be worse than our worst summer bill, which was $ 525 in 2019. It wasn’t until we were in the middle of the storm, when we couldn’t change, that we had any kind of feeling how bad it could be.
How was it for you during the storm?
We were fortunate to maintain power for most of that period. We lose energy once for maybe three hours. Then, halfway through, we started to see the loads arriving. It was like, “Oh, my God, what are we going to do?” We weren’t using washers, dryers, dishwashers – we didn’t have water to use them. Basically, it was just the heat to stay warm and [electricity to] run our computers to try to continue working from home. We were just trying to keep warm to keep the pipes from bursting and to keep our home warm for our five-month-old son. There is really nothing else we can do in terms of energy to save. And it’s crazy to think that $ 3,000 is actually lower than some people owe.
What did your account end up being?
At one point, the bill was $ 1,700. And I said, “OK, well, it can’t get any worse than that.” And then I looked later and I saw $ 2,000 and then $ 2,700. And I said, “Where does it end?”
Where did it end?
It is currently at $ 2,796.85. The projection is $ 3,002.08.
What does this mean financially for you?
It won’t be fun. I would prefer to put those $ 3,000 into a college savings plan for my son and start one of those. I think that as long as the bill doesn’t go over that, I’m lucky to be able to pay that. Many people are not. And that should be a concern for anyone.
You have chosen to go with Griddy, a company linked to market rates. Did you know that this was something that could happen?
Yes, there is a risk that you take on something like that, and you know it. [But] I don’t think anyone could have predicted what that risk really entailed. No one knew that Griddy could reach $ 9 an kilowatt hour. I chose Griddy on the recommendation of friends who had him. You saw higher summer bills, but this was usually offset by bills in the off-summer months. I just don’t think anyone could imagine how astronomically high these prices could be. There was no consumer protection here.
What do you think will happen?
The news coverage at the time was about the failure of the Texas energy market as a whole. And then, when I went to Twitter, I saw that there are other people posting their accounts. This began to receive more attention after the initial shock of the Texas winter storm passed.
I think many of us are waiting, and I don’t know how optimistic we are now, knowing that we are in a system that has been totally deregulated, without these consumer protections. We heard Governor Abbott talking about how Texans shouldn’t be harmed by this. And I think Ted Cruz tweeted similar statements. But what does it mean? Does this mean that everything will be covered? Will it be partially covered? If there is help, how long will it take for people to have some part of it forgiven? Or are they just going to say, well, can we set up a payment plan for you to pay back over time? We do not know.
Many people on social media are saying that it is the customer’s fault to choose a high-risk provider and that you must face the repercussions of that. What would you say to them?
There are several thousand people, I’m sure, who didn’t quite understand what they were getting into. I understood that it was variable, but I didn’t understand that rates in Texas could jump to the levels they were at. So how could anyone allow a company to lead consumers to financial ruin?
It’s a little frustrating, overall. The state’s inability to plan and the power company’s inability to plan must not constitute the financial emergency of tens of thousands of Texans. This is just unacceptable, and being against people like me, and defending public services that were run improperly, kind of drives me crazy.
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