Getty images | Justin Sullivan
A Texas woman who was charged with $ 9,546 for energy this month filed a class action lawsuit against Griddy, claiming that the variable rate electricity supplier violated a state law against price distortion during disasters.
Lisa Khoury, a retiree in Mont Belvieu, signed on with Griddy in June 2019 and typically received monthly bills of $ 200 to $ 250 until this month’s energy disaster raised rates. Griddy charged Khoury and her husband $ 9,546 from February 1 to February 19, 2021, the suit said, noting that “some customers have received bills of up to $ 17,000”.
The Khoury lawsuit, filed on Monday in Harris County District Court, seeks to certify a class of thousands of Texas residents who bought power from Griddy, claiming they are entitled to damages of more than $ 1 billion.
“Griddy’s charging excessive prices for electricity with its variable rate plan is unfair,” the suit said. “An unjust act [as defined by Texas law] ‘takes advantage of the consumer’s lack of knowledge, skill, experience or ability to a grossly unfair degree.’ Khoury and members of the class are unsophisticated consumers. They chose Griddy, a wholesale electricity supplier, to pay less. Variable rate plans, however, are a gamble and unpredictable. Consumers rarely understand the risks. Griddy took advantage of this lack of knowledge in an extremely unfair way by selling these plans. “
The lawsuit further says that Griddy should have “implemented a system to prevent its customers from paying excessive prices and taken aggressive measures to avoid it”. The lawsuit claimed that Griddy violated the Texas Deceptive Trade Practices Act, which prohibits “taking advantage of a disaster” by charging excessive prices for basic needs, and that he is guilty of negligence and unjust enrichment.
Griddy: It’s not our fault
In a statement to The Dallas Morning News, Griddy said he is not to blame because “Griddy passes on the wholesale price of electricity to customers with no profit margin. The prices charged are the direct result of the non-market prices ordered by the PUCT [Public Utility Commission of Texas] Last week. The lawsuit has no merit and we intend to defend it vigorously. “
Griddy even defended his prices in a statement on his website on February 18. Griddy said PUCT “cited his ‘full authority on ERCOT (Texas Electric Reliability Council)’ to direct that ERCOT set prices at $ 9 / kWh until the network could manage the outage after being devastated by the freezing winter storm. . “
The statement continued:
According to ERCOT’s market rules, such a price scenario is only applied when the available generation is about to run out (they usually leave a mattress of around 1,000 MW). This is the energy market that Griddy was designed for – one that gives consumers the ability to plan their use based on the ups and downs of wholesale energy and change their use for the cheapest time periods.
However, PUCT changed the rules on Monday.
As of today (Thursday, February 18), 99% of homes have had their power restored and the available generation was well above the 1,000 MW cushion. Still, PUCT left the directive in place and continued to push prices at $ 9 / kWh, approximately 300 times higher than the normal wholesale price. For a home that uses 2,000 kWh per month, prices of $ 9 / kWh amount to more than $ 640 per day in energy charges. In comparison, that same family would normally pay $ 2 a day.
A subsequent statement by Griddy said that the company is “engaging with ERCOT and PUCT seeking customer relief … and is committed to crediting customers for any relief received, dollar for dollar.” Customers who contact Griddy are receiving an automated email response that says, “We will fight for, and alongside, our customers for the responsibility for why prices have remained so high for so long.” Griddy is also directing customers to an application for his deferred payment plan.
We asked Griddy if there are any additional responses to the process and will update this article if we get an answer.
Griddy withdrew $ 1,200 from his bank account
Khoury’s lawsuit noted that Griddy’s customers pay a monthly fee of $ 10 plus “the cost of spot energy deals on the Texas power grid based on the time of day they use the energy.” Khoury generally kept a balance of $ 150 in his Griddy account to pay the bills. After the storm, “Griddy automatically withdrew from Khoury’s bank account each time his electricity bill reached the $ 150 top up amount. From February 13 to 18, 2021, Griddy withdrew from Khoury’s bank account eight times, $ 150 at a time. On Friday, February 19, 2021, Griddy withdrew a total of $ 1,200 from Khoury’s bank account. “
Khoury has suspended payment from his bank account to prevent further withdrawals, but “he still owed Griddy an additional $ 8,235,” the suit said.
“Griddy attacked Khoury in the middle of a disaster,” said the complaint. “She and her husband were without power at their home from Wednesday, February 17, 2021 to Thursday, February 18, 2021. At the same time, Khoury hosted her parents and relatives, who are in their 80s. , during the storm. Still, it continued to minimize energy use because of high prices. “
The lawsuit claims that Griddy can be “held responsible and liable for price manipulation” during a disaster under the Texas Illicit Trade Practices Act, although “Griddy tried to justify the price increases as a result of the wholesale energy market and put the burden on customers to track market prices. “
Griddy failed to take measures that could have prevented large accounts, the process said: “Griddy had the capacity, capacity and contractual right to avoid charging customers excessive prices during the disaster. Griddy controlled its services and platform and supervised prices and contracts. “
Griddy sent an email to 29,000 customers on February 14, suggesting that they switch to a different energy company at a flat rate, the suit said. However, the process said: “Customers were unable to switch providers because other providers were not accepting new customers due to the storm. Khoury tried to switch providers on Tuesday, February 16, 2021 and was initially informed that the service only could start in a week. Persistent under pressure, Khoury managed to switch suppliers on Friday, February 19, 2021. “
Lieutenant Gov: “Read the fine print”
Khoury’s lawsuit cited government officials who spoke out against high-powered bills, including Senator Ted Cruz (R-Texas), who said, “No energy company should receive unexpected profits because of a natural disaster, and Texans should not be hammered by ridiculous increases in the rates of last week’s energy disaster.”
Texas Lieutenant Governor Dan Patrick told Fox News that “the people who are getting these high bills are people who bet at a very, very low rate, and that would go up with power [costs]. “
Patrick said the government will take some action, potentially including ending variable rate plans. “In the future, people need to read the fine print on these types of accounts and we may even end this type of variable plan because people were surprised,” he said.