The PUC’s moratorium comes at a time when many Texans are seeing massive spikes in electric rates from the winter storm – and those high rates are translating to sky-high bills.
Consumers with variable-rate electricity plans directly felt the impact. With variable-rate plans, the price for energy changes based on fluctuations in the market, such as the level of demand. When the demand for power is low, the rates are lower. But when demand spikes, as it did during the extreme weather last week, the price charged for electricity spikes with it.
Many Texans with variable-rate plans saw rate spikes and are now facing incredibly high electricity bills. Some of these residents were under a wholesale plan from energy company Griddy.
As the cold weather neared the Lone Star State, Griddy suggested users switch to energy plans from other providers. However, many customers found it was already too late. Switching to a new energy provider can take a few days and some providers paused new enrollments once the storm hit.
Griddy is placing blame on ERCOT and the PUC. When temperatures dropped to well below freezing, the PUC ordered ERCOT to allow energy rates to reflect the supply. Because there was such high demand and a lack of supply, energy rates spiked.
According to the EIA, the average electric rate in Texas during the winter is 12 cents per kilowatt-hour. However, the PUC’s order allowed that rate to shoot up to $9 per kilowatt-hour for customers who didn’t have fixed rates.
The spike in rates had a direct impact on residential electricity bills. In an interview with CNN, Dallas resident and Griddy customer DeAndre Upshaw said his electric bill shot up to $7,000.
“While I’m trying to get gas and groceries and make sure that my pipes don’t explode, the last thing I’m thinking about is a $7,000 bill from my utility company,” he said. He attempted to switch from his Griddy plan to another provider, but the new provider delayed his start date.
Upshaw isn’t alone. Arlington resident Ty Williams has a plan with Griddy and saw a charge of $17,000 for five days of electricity. Following Griddy’s suggestion, he tried to switch to another provider, but was told it would take at least a week to complete the switch.
Other energy providers in Texas are responding to the winter storm. Vistra announced it would commit $5 million to help Texans across its retail brands, including TXU Energy and Ambit Energy.
“While some may experience higher than normal bills due to higher usage during this cold weather period in February, we expect our customers will be insulated from storm-related rate increases,” Vistra said in a statement.
Vistra’s $5 million commitment will go to social service agencies in Texas, including food banks. The company will also provide bill payment assistance for customers in need.
Caitlin is a writer within the energy and power industry. Born in Georgia, she attended the University of Georgia before earning her master’s in English at the University of North Carolina at Charlotte.