Griddy Energy, the Texas electricity supplier accused of charging customers thousands of dollars during the winter storm Uri said Monday he has filed for bankruptcy.
Griddy was a “thriving business with more than 29,000 customers” before the winter storm arrived, CEO Michael Fallquist said in a statement. The storm with record low temperatures caused a week-long freeze and left millions without electricity across Texas, causing an estimated $ 195 billion to $ 295 billion in economic and property damage.
Griddy is the third largest Texas energy supplier to go bankrupt since the storm. Brazos Electric Power Cooperative, which served more than 1.5 million jeans, presented by Chapter 11 after accumulating $ 2.1 billion in bills. Just Energy Group also applied for bank protection earlier this month.
Fallquist blamed Texas power grid operator Griddy for seeking protection in Chapter 11. Texas Electric Reliability Council, known as ERCOT, “worsened our customers’ situation by continuing to set prices at $ 9,000. per megawatt hour, ”he said.
“ERCOT’s actions destroyed our business and caused financial damage to our customers,” Fallquist said.
Griddy is a defendant in a class action lawsuit filed last month by customers who have accused the company of price stripping. One client, Lisa Khoury, said Griddy charged her $ 9,546 between Feb. 1 and 19. That amount is 40 times more than his typical bill, he said in court documents.
A Dallas resident told CNN his bill was $ 7,000, while another Texan reported a $ 6,225 listing. Khoury and other members of the class are seeking a $ 1 billion monetary relief. High bills prompted Texas Attorney General’s Office earlier this month to sue Griddy, alleging “false, misleading and misleading advertising and marketing practices.”
Griddy executives argue that ERCOT is to blame for excessive utility bills. During the storm, Griddy asked customers to switch to other suppliers to avoid high prices. However, many vendors were unable to add new customers during the freeze.
Griddy said in a statement that it did not benefit from the February shutdown and does not control changes in energy prices. Griddy said he only charged his usual monthly costs of $ 9.99 to customers when electricity prices rose during the storm.
Greg, governor of Texas Abbott also blamed ERCOT for the debacle. Four ERCOT board members resigned last month as a result of the storm damage. ERCOT supplies Texas with 90% of its power.
Griddy said his bankruptcy reorganization plan frees customers from unpaid electricity bills. The reorganization plan, which has not yet been made public, must be approved by a Houston bankruptcy judge. The company lists its debt at between $ 10 million and $ 50 million, according to court documents.