Griddy: Texas AG says more than $ 29 million in unpaid electricity bills will be forgiven while it sues Griddy Energy

Griddy: Texas AG says more than $ 29 million in unpaid electricity bills will be forgiven while it sues Griddy Energy

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“My office sued Griddy Energy, according to the Texas Deceptive Trade Practices Act, to hold them accountable for the escalation of last month’s winter storm disaster, debiting huge amounts of customer accounts as Texans struggled to survive the storm” , said AG Ken Paxton on Tuesday in a statement.
On Monday, the company filed for Chapter 11 bankruptcy protection, noting more than $ 29 million owed to the Texas Electric Reliability Council (ERCOT), which operates the state’s power grid. This form of bankruptcy allows a company to restructure its debts and reorganize itself to pay creditors over time.

Through the bankruptcy plan, Griddy “will release all outstanding payment obligations for Texas consumers who were unable to pay their energy bills due to the high prices charged during the storm,” said the attorney general’s office.

And Paxton said his office is working with the company “in ongoing negotiations in good faith to try to offer additional relief” to customers who have already paid energy bills stemming from the storms.

Griddy did not immediately respond to CNN’s request for comment. In an online post announcing the bankruptcy filing, Griddy blamed ERCOT.

“ERCOT’s actions destroyed our business and caused financial losses for our customers,” said Michael Fallquist, CEO of Griddy, in a statement.

‘There is no choice but to hang up’

While most Texans and Americans pay a flat fee for electricity, Griddy works by connecting customers to the wholesale electricity market – which is more volatile – for a monthly fee of $ 9.99. When power generators failed last month’s storms and demand for heating skyrocketed, ERCOT raised the price of electricity to the legal limit of $ 9 per kilowatt hour and kept it going for several days.

Griddy customers who did not lose energy were hit by huge electricity bills, which were self-debited from their bank accounts. The state attorney general’s office has received more than 400 consumer complaints against Griddy in less than two weeks, he said earlier.
Texas energy company that collected huge electricity bills during the storm filed for bankruptcy

ERCOT a few days after the storm revoked Griddy Energy’s right to work in the state’s electricity market for non-payment. Following that decision, Griddy said he had “(n) choice but to hang up.”

The attorney general announced this month that he was suing Griddy Energy and Griddy Holdings for “false, misleading and misleading advertising and marketing practices”, claiming that the company deceived customers and minimized the incredible risk of its pricing scheme, which charges more when customers are most vulnerable.

An independent monitor from the Texas Public Utility Commission recently found that ERCOT kept prices too high for nearly two days during the storm, resulting in over $ 16 billion in overcharging.

Another public service commissioner resigns

Meanwhile, another commissioner from the Texas Public Utility Commission resigned this week, according to a statement from Governor Greg Abbott. Commissioner Arthur D’Andrea resigned at Abbott’s request, a press release from the governor’s office said.

“I will appoint a replacement in the next few days, who will be responsible for designing a new course for the agency,” said Abbott. “Texans deserve to have confidence and security in the Public Utility Commission, and this action is one of the many steps that will be taken to achieve this goal.”

Commission President DeAnn Walker and Commissioner Shelly Botkin also resigned after the winter storm, CNN reported. D’Andrea has been the commissioner of PUC since 2017 and was appointed by the governor to serve as head of the commission after Walker’s departure.

Eric Levenson and Christina Maxouris of CNN contributed to this report.

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