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The Electric Reliability Council of Texas has revoked the ability for energy retailer Griddy to operate on its power grid.
The Houston-based company, which offers plans that are tied to the wholesale price of electricity, came under fire when customers faced staggering bills during a deadly cold snap that led to widespread blackouts across Texas.
ERCOT took away Griddy’s access to the state’s electricity market because of nonpayment, Bloomberg reported. The company’s customers will be moved to other electricity providers.
Griddy said in a written statement that ERCOT had effectively shut it down and that the agency, which manages the state’s power grid, “decided to take this action against only one company that represents a tiny fraction of the market.”
The company said it wants to continue to fight for financial relief for its members. Last week it said it was asking for help from ERCOT and the Texas Public Utility Commission.
ERCOT set a price cap of $9,000 per megawatt-hour to incentivize electricity suppliers to add generating capacity. Prices hit the cap during last week’s storm — and stayed there for hours, meaning Griddy customers were paying $9 for a kilowatt-hour that usually costs just a few cents.
Griddy took the unusual step ahead of the storm of telling customers to switch to other providers because they were likely to face exorbitant bills. But many did not, or were unable to, and found themselves owing thousands of dollars for just a few days of power.
A class-action lawsuit against Griddy was filed Monday in Houston and seeks more than $1 billion in damages. Griddy called that lawsuit “meritless” in a statement.