Texas Attorney General Says $29M In Electric Bills Will Be Forgiven

Texas Attorney General Ken Paxton announced Tuesday that over $29 million in unpaid electric bills charged during February's devastating winter storm will be forgiven. The relief is part of a bankruptcy plan by Griddy Energy, the Texas electricity provider accused of overcharging customers by thousands of dollars.

Griddy filed for bankruptcy on Monday, making it the third Texas energy provider to file do so since the February storm that left millions of the state's residents without power amid subfreezing temperatures. At least 57 people died as a result of the storm, according to preliminary data released by the Texas Department of State Health Services on Monday.

"My office sued Griddy Energy, under the Texas Deceptive Trade Practices Act, to hold them accountable for their escalation of last month's winter storm disaster by debiting enormous amounts from customer accounts as Texans struggled to survive the storm," Paxton said in response to Griddy's bankruptcy filing. 

Griddy's plan offers "releases to approximately 24,000 former customers who owe $29.1 million in unpaid electric bills," according to Paxton. He said his office is in ongoing negotiations with the provider "to attempt to address additional relief for those Griddy customers who have already paid their storm-related energy bills." 

"Through the bankruptcy plan, Griddy will release all outstanding payment obligations for those Texas consumers who were unable to pay their energy bills due to the high prices charged during the storm," according to the attorney general. "Texas will abate the state court lawsuit and Civil Investigative Demand and Griddy will work with it in good faith to resolve these matters. Texas and Griddy will work in good faith to address relief for Texans who have already paid."

Negotiations over paid bills could affect customers like Lisa Khoury, a resident of Chambers County in Houston, who says Griddy pulled $1,200 from her bank account via an auto-pay system before she stopped payment through her bank. She still owes over $8,000 for power that was intermittent. 

Khoury is part of a class-action lawsuit against Griddy seeking $1 billion in monetary relief from the company.

"Griddy charged Khoury in the middle of a disaster. She and her husband mostly were without power in their home from Wednesday, February 17, 2021, to Thursday, February 18, 2021," the complaint reads. She was charged $9,546 between February 1 and 19 — about 40 times more than her typical bill range of $200 to $250, according to the suit. "At the same time, Khoury hosted her parents and in-laws, who are in their 80s, during the storm. Even then, she continued to minimize any power usage because of the high prices," reads the complaint.

Khoury's lawyer Derek Potts, national managing partner of the Potts Law Firm, said Griddy's billing runs afoul of Texas' consumer protection laws — and thousands of electricity users are likely affected.

Potts said his firm is now "in the process of reviewing the Attorney General's press release," and in the meantime is "continuing to move forward to attempt to locate and recoup the estimated tens of millions of dollars which were actually taken from Texas consumers' bank accounts and credit cards during the storm event by Griddy."

Griddy said the class-action lawsuit was "meritless" in a statement given to the Dallas Morning News. On its website, the company states it does not profit from high power prices and blamed the Public Utility Commission of Texas for last weekend's astronomical hikes. "The PUCT (Public Utility Commission) changed the rules on Monday" when it directed Texas' grid provider to allow astronomically high power prices, Griddy said, adding that it was "seeking relief" for its customers from the Electric Reliability Council of Texas (ERCOT), which manages the flow of electricity to them. ERCOT is subject to oversight by the Public Utility Commission.

The last remaining member has now resigned from his post, Governor Greg Abbott said in a statement Tuesday night. Public Utility Commission Chair Arthur D'Andrea, the only remaining member of the three-seat board that regulates Texas utilities, stepped down at Abbott's request, according to the governor. 

"Tonight, I asked for and accepted the resignation of PUC Commissioner Arthur D'Andrea. I will be naming a replacement in the coming days who will have the responsibility of charting a new and fresh course for the agency," reads Abbott's statement. "Texans deserve to have trust and confidence in the Public Utility Commission, and this action is one of many steps that will be taken to achieve that goal."

Abbott has repeatedly blamed ERCOT for the power failures, and has called for an investigation into the council. Four ERCOT board members announced their own plans to resign immediately after the storm, two days later a seventh member had stepped down, the Texas Tribune reports. 

In a letter to the board, the first resigning members cited concerns about their "out-of-state board leadership." Three of the resigning board members lived in other states, and one lived in another country. 

"We have noted recent concerns about out-of-state board leadership at ERCOT," the letter said. "To allow state leaders a free hand with future direction and to eliminate distractions, we are resigning from the board effective after our urgent board teleconference meeting adjourns on Wednesday, February 24, 2021."

After the seventh resignation, ERCOT spokeswoman Leslie Sopko said: "I believe he is from Texas."

Irina Ivanova contributed to this report. 

First published on March 17, 2021 / 6:31 PM

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