The meter provided by the utility company is called the bulk or master meter and meters the energy use for the entire building. A submeter is a meter that is used after the main utility meter to meter individual apartments, rooms or equipments. A submeter is not provided by the utility company but is added later by either the landlord or property manager.
Submetering encourages tenant energy saving. The energy savings derived from submetering persists over time as the tenant will tend to consciously conserve energy in their daily usage and invest more in energy efficient appliances as they are able to directly see the benefits from the changes in their electric bill.
Submetering is eminently fair. Submetering restores the “user pays” concept. Users only pay for the actual energy that consume. Tenants that use more energy is charged more, and tenants who consciously saves energy will see their efforts rewarded with a smaller bill.
Submetering benefits owners. Submetering largely eliminates one the most volatile, variable and difficult to control factor from a building’s energy budget.
Submetering is transparent and object. Tenants are charged by the actual amount that they use. Contrast this with charging per square; those who use less electricity by square footage is actually subsidizing the other tenants who tend to use more than their square per allocated square footage.
Submetering benefits utilities. By reducing energy wastage, utilities can defer the need to site, build, or acquire additional generating capacity.
Submetering allows the electricity bill to be separated from the rent. By doing so, the tenant will no longer be overcharged for electricity and will pay only for the exact amount consumed. The landlord will no longer need to worry about undercharging.Separating the electricity from the rent eliminates the vicious cycle between the landlord and tenant; the landlord will charge a nomimal fee for reasonable use; the tenant will not care about saving energy since it is already included in the rent; the landlord will then respond by increasing the rent to cover the excess electricity use and so on. Submetering breaks this vicious cycle as the electricity is no longer part of the rent and can be gauged objectively.
Submetering works by having a building-owned meter installed for each tenant. The building or property owner continues to purchase its electricity on a bulk rate basis, the owner then bills each individual tenant on an actual consumption basis. The relationship between the building owner and the utility remains the same as before. The owner continues to receive one bill from the utility and it is up to the owner to allocate the utility cost based on the usage recorded by each tenant submeter.
The building’s utility billing process and meter reading schedule will not be affected by the implementation of submetering. The building will still be billed at the same rate as before and any changes in the utility rates will not be affected by the prsence of submetering in the building.