Griddy’s customers moved to other electricity providers after ERCOT withdrew it from the Texas market

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Texans who receive electricity from Griddy Energy are being transferred to other suppliers after the Texas Electric Reliability Council, which operates the power grid for most of Texas, revoked the company’s rights to operate because it missed payments required by ERCOT , according to a market perceive.

In all, Texas electricity providers have failed to make more than $ 2.1 billion in payments due to ERCOT, according to another statement to the market on Friday. The state entity relies on supplier transaction fees to help operate the state’s electricity grid. These missed payments came after the costs of one megawatt / hour of electricity jumped from an average of $ 35 to $ 9,000 during the height of last week’s devastating winter storm that contributed to the near collapse of the state’s power grid.

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Griddy made headlines for sending huge bills to customers. A woman in Chambers County filed a class action accusing Griddy of price fraud. In the lawsuit, his lawyer claimed that the company charged more than $ 9,000 for the week of the storm, in stark contrast to its normal $ 200 to $ 500 monthly bill.

Griddy passes wholesale electricity rates directly to customers, who in turn pay the company $ 10 a month. This differs from fixed-rate electricity plans, which offer a consistent rate, regardless of market conditions. Wholesale prices increased during the storm because the winter weather temporarily left many power generators down, reducing supply and increasing demand.

ERCOT said it was “working closely with the PUC team and Affected Market Participants to ensure an efficient and effective transfer of customers”. ERCOT spokeswoman Leslie Sopko said she had no further details about Griddy’s customers.

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In a message to customers that Griddy spokeswoman Lauren Valdes shared with The Texas Tribune, the company said ERCOT ignored emergency aid requests and closed on Friday.

“It was not a choice we made,” said the message. “On the same day that ERCOT announced that it had a deficit of $ 2.1 billion, it decided to take this action against just one company that represents a small fraction of the market and that deficit.”

ERCOT can prevent electricity providers from conducting business if they make four payments late in one year, according to the entity’s protocols.

Last week, Griddy warned customers about price increases and encouraged them to switch to other suppliers, according to an earlier report in The Texas Tribune. The company also posted a blog on its website blaming the Texas Public Utility Commission, which regulates ERCOT, for raising the price of energy in the wholesale market.

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The disastrous effects of last week’s storm spurred full-day hearings in the Texas House and Senate on Thursdays and Fridays, where lawmakers questioned ERCOT CEO Bill Magness, PUC president DeAnn Walker and representatives of several electricity providers about what went wrong.

Tom Hancock, representative of the municipal utility Garland Power and Light, said that many suppliers may find it difficult to make their payments to ERCOT in time after the consequences of the storm.

“ERCOT receives a lot of money from market participants that could be sold,” said Hancock. “We think that if that domino effect starts to happen, we will know about it after today.”