Griddy to File for BK After Loss of Customers

Texas power retailer Griddy Energy LLC is planning to file for bankruptcy. This is after the state grid operator, Electric Reliability Council of Texas (ERCOT), blocked Griddy’s access to customers.

Many of these customers had unpaid bills following the state’s deadly temperature drop last month. Those bills are a result of spiking power prices from Griddy, which sold power to customers at market rates. When prices jumped to $9,000 per megawatt hour (MWh) and remained at that level for days, some customers received monthly bills of more than $10,000. That compares with an ERCOT average price per MWh of $22 in 2020, according to Reuters.

“ERCOT took our members and have effectively shut down Griddy. On February 16, we asked ERCOT for emergency help when our members needed it the most and they did not take action. This is after the PUCT mandated the maximum price for days – a decision they made to take the price out of the hands of the market in a six-minute meeting. On the same day when ERCOT announced that it had a $2.1 billion shortfall, it decided to take this action against only one company that represents a tiny fraction of the market and that shortfall,” the company told customers on its website after ERCOT transferred the 10,000 Griddy customers to other power firms.

As a result, the Texas attorney general is suing Griddy, saying it engaged in deceptive trade practices by issuing excessive bills. In addition, attorneys are pursuing a class action claim on behalf of almost 30,000 Griddy customers. These customers have filed a motion to prevent the electricity provider from tampering with any internal documentation or physical evidence stemming from the recent winter storm.