CHECK OUT BizPacReview on Parler!
Some Texas residents have been hit with electricity bills running as high as $10,000 to $17,000 because of the ongoing winter storm currently ravaging the Lone Star State.
According to Dallas station WFAA, this is occurring because the price for electricity skyrocketed from $50 per megawatt to $9,000 during the height of the storm.
“How in the world can anyone pay that? I mean you go from a couple hundred dollars a month…there’s absolutely no way…it makes no sense,” one exasperated resident, Ty Williams, said to the station.
Williams’ combined bill for his home, his guest home and his office spiked from just $660 last month to over $17,000 this month .
Another pair of residents, Royce Pierce and his wife, Danielle, saw the electric bill for their modest three-bedroom home spike to nearly $10,000 in a matter of days.
“We are hoping there will be relief. This is something maybe we can skate by and tackle as time goes on but how many people can’t? A lot,” Royce said to NBC News.
There are countless more examples like:
When your electric company tells you to switch but there has been a hold on switching for over a week now. Using as little as possible 1300 sq ft house and this is my bill. . How is this fair. I only paid $1200 for the whole 2020 year @FoxNews @wfaa @tedcruz @GovAbbott pic.twitter.com/AylTS4m0j4
— kat and tony (@katandtonyT) February 18, 2021
this is my electric bill for the past 5 days. we were without power for most of it. i think i’m ready to leave texas. pic.twitter.com/oUF5XQbDRI
— all right i was just goofing it’s actually me john (@johnspriggz) February 19, 2021
My aunt’s utility bill (only 5 days so far) in north Texas. I would die pic.twitter.com/DEu839KR5L
— vaughn (@VaughnDieseI) February 19, 2021
— Tina Gray-Russell (@TinaRussell309) February 18, 2021
very awesome time to be a texan 👍🏼 pic.twitter.com/zbn9bbxlim
— badgirIkiki (@badgirIkiki) February 19, 2021
RIP to everyone using Griddy here in Houston pic.twitter.com/4GToNlzQmb
— Mike Metzler (@MTZLER) February 19, 2021
Friend of a friend just got this bill through griddy while going through rolling blackouts in a small house. This is extortion pic.twitter.com/wN9MEGHUAG
— Andrew Kochie (@AndrewKochie) February 17, 2021
A co-workers griddy bill spanning the last 22 days. 2BR house. pic.twitter.com/BDNqvKhIyy
— jim_fleming (@jim_fleming) February 20, 2021
Texas is among a handful of states, including a couple blue ones like New Jersey and Maine, that boast variable rate electricity plans thanks to deregulation. These plans are based on market conditions, the benefit being lower-than-average price for electricity — most of the time.
“In an energy market where prices are falling, choosing a variable rate plan may end up saving you the most money. You’ll be able to take advantage of declining prices rather than being stuck in a higher-priced contract,” the independent energy company Smart Energy notes.
Plus, variable rate plans usually boast no cancellation fee, making it easier for the customer to switch to another plan or company.
A problem arises only when the market is out of whack, as is the case currently in Texas. That’s why a fixed-rate plan is usually recommended.
“One of the biggest benefits of fixed rate plans is that they provide consistency and reliability. You’ll never be surprised by a sudden upswing in energy prices. This can be especially useful for those who want to avoid risk when it comes to their finances,” Smart Energy notes.
Every Texan experiencing a spike in their energy bill is on a variable-rate plan, including Royce and his wife.
“Since the family is on a variable rate plan with Griddy, the company automatically debits the bill as they use electricity. Danielle said she closed the debit card connected to their electricity bill because Griddy wiped it out. The family has been using separate accounts and credit cards to pay for necessities as the storm goes on,” according to NBC News.
That being said, Griddy, the most popular supplier of fixed rate plans in Texas, has claimed that the issue isn’t with them but rather with bureaucrats.
In a statement published Thursday, the energy company specifically blamed the Public Utility Commission of Texas, a state agency, for taking over the Electric Reliability Council of Texas (ERCOT) and spiking prices.
According to Griddy, after taking over ERCOT, the commission raised the wholesale price of electricity to $9/kilowatt hour “until the grid could manage the outage situation after being ravaged by the freezing winter storm.”
The problem is that once the grid settled down, the commission never lowered the price back to its regular level.
“As of today (Thursday), 99% of homes have their power restored. … Yet, the PUCT left the directive in place and continued to force prices to $9/kWh, approximately 300x higher than the normal wholesale price,” the company’s statement explains.
“For a home that uses 2,000 kWh per month, prices at $9/kWh work out to over $640 per day in energy charges. By comparison, that same household would typically pay $2 per day.”
Griddy added that the commission “used their authority to ensure a $9/kWh price for generation when the market’s true supply and demand conditions called for far less” — and in doing so, created thousands of dollars in profit for the actual power generators.
A reader points out it isn’t Griddy necessarily profiting here (they pass on the wholesale price of the electricity). More here: https://t.co/keVdgY3A4k
— Alex Leo (@AlexMLeo) February 20, 2021
“The market is supposed to set the prices, not political appointees,” Griddy concluded.