Submetering is a mechanism for measuring tenants’ usage of utilities so that owners can charge higher rates to tenants who use more, and lower rates to tenants who use less. It is applicable to buildings that previously only had a master meter connecting to the local utility, which are generally older buildings. Submetering is becoming more desirable in public housing as housing agencies seek ways to reduce costs. Numerous studies have shown that when customers are shifted from master metering to submetering, consumption declines enough to recover the cost of the submetering system in a reasonable time. Once that initial cost has been recouped, the building owner continues to enjoy reduced utility costs. As utility cost pressures increase, more and more HUD assisted housing providers will find submetering worth exploring, not only in new or gut rehab construction, but also as a retrofit option. The technology is proven and sophisticated, and the potential for substantial savings is real.

This report by Steven Winter Associates provides an overview of the mechanics, value, and effectiveness of shifting the utility cost burden from Public Housing (PH), privately owned multifamily assisted housing (MF), and Rental Assistance Demonstration (RAD) projects to tenants through the installation of utility sub-metering systems.