Texans hit with massive electricity bills during last month's winter storm won't have to pay them.
The state's attorney general ensured relief to the 24,000 Griddy Energy customers who owed $29 million.
Griddy Energy, the wholesale electricity provider, filed for Chapter 11 bankruptcy earlier this week.
Texans who lost heat and power during a rare winter storm last month will no longer be stuck with exorbitant electric bills, the state's attorney general announced.
Attorney General Ken Paxton said he would wipe out more than $29 million in unpaid electric bills owed by approximately 24,000 Griddy Energy customers in a Wednesday statement.
Paxton announced his office was suing the Texas energy company earlier this month for "violating the Texas Deceptive Trade Practices Act through false, misleading, and deceptive advertising and marketing practices."
During February's bout of record-low temperatures, the state's power companies failed to withstand the freezing conditions, leaving millions of residents without electricity during the winter storm that left dozens dead.
As Texans faced the aftermath of the storm, Paxton said Griddy escalated the disaster by "debiting enormous amounts from customer accounts" with "little to no warning" which resulted in consumers paying hundreds - and in some cases, thousands - of dollars each day for electricity.
Paxton has since dropped the suit and instead, said his office and the company are now in "ongoing good faith negotiations to attempt to address relief for those Griddy customers who have already paid their storm-related energy bills."
In an online statement Monday, Griddy announced it had filed for Chapter 11 bankruptcy, placing the blame decidedly on the Electric Reliability Council of Texas, the organization that operates Texas's electrical grid which supplies 90% of the state's electric load.
Since the storm, ERCOT has come under fire for failing to prepare for the harsh winter conditions. According to Griddy, "ERCOT made a bad situation worse" by continuing to set prices at $9,000 per megawatt hour - nearly 300 times more than the normal price - for 87.5 hours.
Griddy connects its customers to the wholesale electricity market for a monthly fee of $9.99, the statement said. As such, the company said it did not profit off the skyrocketing prices seen during the storm.
"The actions of ERCOT destroyed our business and caused financial harm to our customers," Griddy CEO Michael Fallquist said in the statement.
A spokesperson for ERCOT told Insider the organization had no comment on Griddy's communications to its customers, though the representative did confirm Griddy's aggregate short pay to ERCOT was at $29 million as of March 17.
One customer, Royce Pierce, told NBC News he and his wife's bill had reached nearly $10,000 over a matter of days for their three-bedroom home. He told the outlet Griddy automatically took the amount from their card, and the couple had been forced to close the card after the company wiped it out.
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