HOUSTON (NEXSTAR) – A woman who accuses Texas electricity company Griddy of price-gouging during a winter storm that knocked out power to millions has filed a proposed class action lawsuit.
Lisa Khoury, who lives about 30 miles east of Houston in Mont Belvieu, said in a news release that her bill between Feb. 13 and Feb. 19 shot up to $9,340 as Griddy made daily withdrawals from her bank account.
Unlike companies that give fixed rates, Griddy charges its customers $10 a month and provides electricity at whatever the wholesale rate is, according to the Texas Tribune. The wholesale rate skyrocketed after flooding and other storm-related conditions crippled supply just as demand was spiking.
Khoury says she’s used to paying $200-$250 per month, and had to place a stop-payment order on her bank account after repeated failed attempts to get answers from Griddy.
“At this point we don’t know how many people might be affected, but there are likely thousands of customers who’ve received these outrageous bills,” says Derek Potts of the Potts Law Firm in Houston, who represents Ms. Khoury. “A class action will be the most efficient and effective way for Griddy’s customers to come together and fight this predatory pricing.”
The proposed class action suit would cover all Texas Griddy customers who received “excessive charges” after the storm.
The lawsuit, which was filed in a Harris County state district court, seeks more than $1 billion from Griddy for allegedly violating the Texas Deceptive Trade Practices Act.
Griddy did not immediately reply to a request for comment, but said in a statement on the company’s website that the Public Utility Commission of Texas (PUCT) directed ERCOT, the council that manages the flow of power to Texans, to set wholesale pricing at $9/kWh – roughly 300 times higher than the normal wholesale price.
Griddy claims that the measure was supposed to be temporary, in place only until the grid could manage the surging usage amid plummeting temperatures, but was left in place even as millions got their power back later in the week.
The PUCT has launched an investigation into “indexed” electricity plans like Griddy’s that tie costs to the wholesale rate.
“While the architecture of these indexed plans [is] theoretically allowable under state law and Commission rules, an influx of complaints into our Customer Protection Division has caused concerns that questionable business practices might be exacerbating the situation,” said Thomas Gleeson, PUCT executive director.
The utility commission noted that customers of municipally owned utilities and other providers with fixed or variable price contracts “will be largely unaffected by the scarcity-driven increase in the wholesale market price for electricity, customers with plans indexed to the wholesale rate are reporting serious financial consequences.”