Texans who received their electricity through wholesale provider Griddy have been absolved of the sky-high rates they were forced to pay, state Attorney General Ken Paxton announced on Tuesday. Some 24,000 Griddy customers will be relieved of the charges for $29.1 million in unpaid electrical bills after the AG sued Griddy under the Texas Deceptive Trade Practices Act following a week of record cold temperatures last month.
The five-day cold snap that saw some Texas residents hit with electricity prices of up to $9,000 per megawatt-hour – a rate over 100 times higher than the normal $25-$30 – added a profound layer of insult to the injury Texans were already suffering under the unseasonably frigid conditions. Paxton’s lawsuit released Griddy’s former customers from the utility’s bankruptcy, and the AG’s office is also reportedly working with the defunct utility to obtain “relief” for Texans who had already paid the wildly inflated energy bills in whole or part.
The utility filed for Chapter 11 bankruptcy on Monday, after the state’s grid operator ERCOT billed it for $29 million, a sum it could not afford to pay. The utility claimed it had no choice but to lay off 15 of its 30 employees in late February following the storm.
Texas’ grid is not connected to those of other states and during the extreme cold snap, wholesale electricity prices soared – a catastrophic situation for Texans unaware they were being billed at the inflated rate for an entire week. While some customers got stuck paying Griddy’s highly inflated rate, others were able to switch to other providers selling electricity at the fixed rate most Texas electric customers pay.
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