(Reuters) – Texas electricity retailer Griddy Energy LLC plans to file for bankruptcy after the state-owned grid operator cut off the company’s access to customers for unpaid bills after the Texas freeze in the Wall Street Journal sources familiar with the matter.
Company officials were not immediately available for comment.
Griddy sold energy to customers at market prices. When energy prices rose to $ 9,000 per megawatt hour (MWh) and remained at that high level for days during the extreme cold of February, some customers received monthly bills of more than $ 10,000.
This compares to an average power price of $ 22 per MWh in 2020 at the Texas Electric Reliability Council (ERCOT), which operates the state’s power grid.
“ERCOT grabbed our members and has effectively shut down Griddy,” the company told customers on its website after ERCOT transferred approximately 10,000 Griddy customers to others.
In addition to losing his clients, the Texas Attorney General sued Griddy, saying he engaged in deceptive business practices by issuing excessive bills.
Griddy said he was urging customers to switch to other providers at a flat rate before the worst of the storm occurred in February.
Texas’ freezing high gas and electricity bills have already forced two other companies to seek bankruptcy protection: Just Energy Group Inc and Brazos Electric Power Cooperative Inc.
Reports by Scott DiSavino; Edited by Kim Coghill