Texas woman who received $9300 electric bill files lawsuit against electricity provider

[enhanced_deficit]

Mega regulation of 'free markets' in TX apparently on the way to stop 'price gouging'.. courtesy of TX GOP leaders:


Texas woman who received $9,300 electricity bill files class-action lawsuit against wholesale electricity provider Griddy

A Chambers County resident filed a class-action lawsuit against electricity retailer Griddy on Monday, accusing the provider of price gouging customers during last week’s freeze. She is seeking $1 billion in relief for affected customers.

by Reese Oxner Feb. 23, 2021 Updated: 6 hours ago

A Chambers County resident filed a class-action lawsuit against electricity retailer Griddy on Monday, accusing the provider of price gouging customers during last week’s freeze. She is seeking $1 billion in relief for affected customers.

Attorneys for Lisa Khoury said in the lawsuit that her bill spiked to $9,340 the week of the storm, compared to her average monthly bills that range from $200 to $250. Griddy drafted payments from Khoury’s bank account several times, according to the lawsuit, pulling $1,200 before she blocked further charges from her bank. She still owes thousands.

Griddy passes wholesale electricity rates directly to customers, who in turn pay the company $10 a month. This differs from fixed-rate electricity plans which offer a consistent rate regardless of market conditions.

But because of a price hike fueled by a shortage of supply and skyrocketing demand, some customers were faced with bills charging tens of thousands of dollars. While electricity bills are likely to rise across the board, Texans on variable rate plans faced immediate and alarmingly high prices.

Texas’ Public Utility Commission, appointed by Abbott, raised the wholesale market price of electricity to $9 per kilo-watt hour — a 7,400% increase over the average 12 cents per kilo-watt hour — in response to rising demand. The hope was power generators would be enticed to produce more electricity.

“Energy prices should reflect scarcity of the supply,” the order stated.

Representatives for Griddy could not immediately be reached for comment. The electricity retailer addressed concerns of price gouging on its website and firmly placed the blame on the Public Utility Commission. The company states that it did not profit from raised prices.

https://www.texastribune.org/2021/02...c-bill-griddy/




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[CaptUSA]

Unreal - read your contracts, people. You benefit from a variable rate plan every day, but then bitch about it when it bites you. Pretty sure I said this was going to happen.

You watch what's going to happen in a few weeks when people start getting their bills for this.

http://www.ronpaulforums.com/showthr...52#post7024152

The PUC can be blamed for artificially raising the wholesale prices, but they probably staved off a catastrophe. The free market side of this is that they shouldn't have set any limits on prices whatsoever. The limits benefitted the retail power providers by limiting their loss in the retail market for their customers on fixed-rate plans. People on variable rate plans just got a pass-through.


But really, the main issue here are the obfuscation of the price signals. You have a product that is delivered at near the speed of light, but your price signals are at the hourly level in the wholesale market, and up to a month after the fact in the retail market. That's just insane.

[enhanced_deficit]

You watch what's going to happen in a few weeks when people start getting their bills for this.

http://www.ronpaulforums.com/showthr...52#post7024152

The PUC can be blamed for artificially raising the wholesale prices, but they probably staved off a catastrophe. The free market side of this is that they shouldn't have set any limits on prices whatsoever. The limits benefitted the retail power providers by limiting their loss in the retail market for their customers on fixed-rate plans. People on variable rate plans just got a pass-through.


But really, the main issue here are the obfuscation of the price signals. You have a product that is delivered at near the speed of light, but your price signals are at the hourly level in the wholesale market, and up to a month after the fact in the retail market. That's just insane.

Good call!

Plus throw in unusual 'climate change' in the mix and in the end it might be too much for average consumer to comprehend adjustable rates especially were in fine print.

If recall correctly 2008-09 housing crisis led markets crash was also due to adjustable mortgage rates, although those adjustable mortgage rates loopholes and marketing schemes may not necessarily apply in this case.