Texas Attorney General Ken Paxton has filed a lawsuit against Griddy, LLC (Griddy Energy), the wholesale power provider in Texas that drew attention last month for passing along record costs to customers.
Griddy, based in Houston, charges customers based on the price of energy, which, according to the lawsuit, jumped from a few cents per kilowatt hour to $9 per kwh during the storm.
"Indeed, February 2021 was not the first time that Griddy surprised its customers with astronomical charges, and yet, Griddy’s representations about its program did not prepare its customers for this eventuality," the lawsuit says.
The lawsuit says Griddy customers were paying similar prices during a heatwave in August 2019.
"As a result, consumers in 2019 were surprised and angered at charges—up to $1,200 for three days—that were highly inconsistent with the advertising that had lured them to Griddy. At the time, Griddy’s response to the harm to its consumers was dismissive," the suit continues.
Texas Attorney General Ken Paxton filed a lawsuit Monday morning, accusing Griddy of violating the Texas Deceptive Trade Practices Act "through false, misleading, and deceptive advertising and marketing practices."
"Griddy misled Texans and signed them up for services which, in a time of crisis, resulted in individual Texans each losing thousands of dollars," Paxton wrote in a statement. "As Texans struggled to survive this winter storm, Griddy made the suffering even worse as it debited outrageous amounts each day."
Griddy had not responded to Paxton's lawsuit Monday morning, but when a separate class-action lawsuit was filed in Houston last week, the company called the case "meritless."
The suit filed by Paxton asks the court to order refunds and "injunctive relief from Griddy to ensure that the Texans it serves will receive truthful and accurate energy services in the future."
Last week, ERCOT revoked Griddy's ability to operate in Texas. ERCOT cited non-payment as the reason and switched customers to TXU Energy or Reliant.
At the time, Griddy responded with an open letter to customers, writing, "It was not a choice we made."
Griddy said it had asked ERCOT for help February 16, "when our members needed it the most, and they did not take action." The company said it would continue fighting for "financial relief" for customers.