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Texans who get their electricity from Griddy Energy are being shifted to other providers after the Texas Electric Reliability Council, which operates the electric grid in most of Texas, revoked the company’s rights to operate because it failed to comply required payments to ERCOT, based on a market. realize.
In total, Texas electricity providers made no more than $ 2.1 billion in payments owed to ERCOT, according to another market advisory on Friday. The state entity relies on vendor transaction fees to help operate the state’s electrical grid. Those missed payments came after costs for a megawatt hour of electricity rose 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. .
Griddy made headlines for sending massive invoices to customers. A woman in Chambers County filed a class action lawsuit accusing Griddy of price hikes. In the lawsuit, his attorney claimed that the company charged him more than $ 9,000 for the week of the storm in stark contrast to his normal monthly bill of $ 200 to $ 500.
Griddy passes the wholesale electricity rates directly to customers, who in turn pay the company $ 10 per month. This differs from fixed rate electricity plans that offer a constant rate regardless of market conditions. Wholesale prices skyrocketed during the storm as winter weather temporarily put many power generators out of service, reducing supply and spiking demand.
ERCOT said it was “working closely with PUC staff and affected Market Participants to ensure efficient and effective customer transfer.” ERCOT spokeswoman Leslie Sopko said she had no further details on Griddy’s clients.
In a message to customers that Griddy spokeswoman Lauren Valdes shared with The Texas Tribune, the company said ERCOT ignored requests for emergency assistance and closed it on Friday.
“It was not a choice we made,” the message read. “On the same day that ERCOT announced that it had a deficit of 2.1 billion dollars, it decided to take this action against a single company that represents a small fraction of the market and that deficit.”
ERCOT may prohibit electricity providers from conducting business if they make four late payments during a year, in accordance with the entity’s protocols.
Last week, Griddy warned customers about price increases and encouraged them to switch to other providers, according to previous reports from The Texas Tribune. The company also posted a blog on its website blaming the Public Utilities Commission of Texas, which regulates ERCOT, for raising the price of energy in the wholesale market.
The disastrous effects of last week’s storm sparked day-long hearings in the Texas House and Senate on Thursday and Friday, where lawmakers questioned ERCOT CEO Bill Magness and the president of the PUC, DeAnn Walker, and representatives from a variety of electricity providers about what went wrong.
Tom Hancock, a representative for utility company Garland Power and Light, said that many providers may have a difficult time making their payments to ERCOT on time after the aftermath of the storm.
“ERCOT owes a lot of money today from market participants that could have been short,” Hancock said. “We believe that if this domino effect is going to start to occur, after today, we will know.”