Texas households who get their electricity on variable or indexed pricing plans are likely going to see their electrical bills spike in the wake of the recent cold snap, with reports emerging that some Texans are already seeing their electrical bills skyrocket.
In Texas’ highly competitive electricity market, some retail providers offer customers prices pegged to daily wholesale rates or other forms of indexing. Under normal circumstances, this can mean lower prices, but after the cold snap squeezed grid capacity and led to a dramatic run up in wholesale electricity prices, some households have been hit with huge bills.
“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,” said Williams, who added that the bill came from Griddy, an electricity retailer that pegs its prices to wholesale rates and even urged its customers to switch providers in the short-term to avoid sticker shock.
“Heat set at 60, no laundry, no running dishwasher, no stove/oven cooking, only used air fryer, lights off during the day candles at night most of the time, Tv on,” the couple said.
“On Monday evening the Public Utility Commission of Texas (PUCT) cited its ‘complete authority over ERCOT’ to direct that ERCOT set pricing at $9/kWh until the grid could manage the outage situation after being ravaged by the freezing winter storm,” Griddy wrote.
The $9/kWh price is about 300 times higher than the normal wholesale price.
“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 wrote.
“The decision was spurred by ERCOT’s discovery that energy prices across the system were clearing at less than the current system-wide offer cap of $9,000 established by Commission rule,” the release added.
Meanwhile, Texas Attorney General Ken Paxton has launched an investigation into ERCOT, alleging “mishandling” amid the brutal cold snap that has left millions of Texans shivering and in the dark.
“What do they do in response? Jack up prices, go silent, make excuses, & play the blame game. It’s unacceptable!” he added.