During Winter Storm Uri in 2021, wholesale electricity in Texas jumped from $50 per megawatt-hour to the regulatory cap of $9,000. Customers of the retailer Griddy paid that raw price. Some of them got bills of $10,000 or more for a few days of power.
Griddy sold households electricity at the real-time wholesale rate. Most of the time that saved them money, and its 29,000 customers often gained from low imbalance prices. The storm showed what the model leaves out: nothing sits between the household and the market when prices spike.
The Texas lesson
Texas has a deregulated retail market, and most consumers there pick a fixed-rate plan with predictable bills. Retailers who sell fixed rates build a cushion into the price against surges. Wholesale plans like Griddy’s skip the cushion and hand the risk to the customer.
Energy Ogre, a Texas electricity broker, warned about this in a February 2022 piece. Wholesale prices there move every 15 minutes, it said, and have ranged from -$23 to more than $2,100. David Kinchen, the firm’s director of automated operations, called buying at wholesale “a big gamble.”
The firm gave an earlier example. On 9 October 2017, a price surge in the real-time market lasted four hours. A customer using 2,800 kWh a month who did not cut back paid more than $32 for that day. A customer on a fixed rate paid $3.55. In Houston, prices topped $100 in 430 intervals between January and September 2017, and the biggest spike hit $3,095.98, or $3.10 per kWh.
Griddy’s argument was that members could profit when prices go negative. Energy Ogre agreed that was true, but noted such dips usually come in off-peak hours when people are asleep and using little power. A real-time customer also has to watch an app and switch usage off at a moment’s notice. “We consider buying real-time pricing like picking up pennies in front of a steamroller,” the firm wrote.
Texas acted. In May 2021 it passed SB 3, which effectively banned wholesale-indexed plans for residential customers, and lowered the wholesale price cap. Griddy went bankrupt. Such plans are now illegal for Texas households.
Spain and Norway
Spain’s default tariff, the PVPC, was tied directly to the hourly wholesale market until recently. In the 2022 crisis the government capped the gas price used in power generation, yet households on the default rate saw their bills double. Households on fixed tariffs did not. About 11 million households on the default tariff did well on high-renewables days and suffered after the invasion of Ukraine. In 2024 Spain changed the PVPC to include a basket of long-term futures prices to dampen hourly swings.
Norway still has more households on dynamic tariffs than any other country, but the numbers have dropped sharply. ACER’s 2024 Retail Market Monitoring Report put the share at 93%. After price spikes in December 2024, the government brought in a regulated option, Norgespris, in October 2025. Some 48% of households have chosen it. In the three zones with the most volatile prices, 63% of households, covering 72% of demand, have signed up. Dynamic tariffs remain favorable in low-price, low-volatility zones.
Why regulators still like the idea
The appeal is simple. Cost-reflective pricing is meant to change behavior and free up the flexibility a renewables-heavy grid needs, and cutting out middlemen is meant to lower bills. A LinkedIn analysis published in February 2026 weighs that against the record in the three countries. Wherever dynamic tariffs have become common, it found, their popularity collapsed once consumers met market volatility.
Sources
- Is Real-Time Wholesale Electricity Pricing Like Griddy
- Should retail electricity consumers be exposed to wholesale markets?
