May 2016
Bulk Metering, Smart Meters and Submetering
When people do not pay directly for the energy they use, they act as if it is free and generally do not conserve.
With the cost of utilities accounting for upwards of 40% of a condo corporation’s annual budget, finding ways to better manage this expense is important to keeping condo fees in check. Electricity, the costliest and most heavily used utility, offers the greatest opportunity for reducing usage and cost.
In a single family dwelling a single meter reads electricity usage. The home owner pays for what is used.
Condo buildings are more complex. Older buildings had, and may still have, a single meter for the entire building. Electricity costs were shared – often based on size of condo suite. In practice, some condo suites used more electricity than others. This was typically ignored because there was no way to measure it.
When condo residents do not pay directly for the electricity they use, it is often treated as being free. Lights are left on when not needed, heat and air conditioning are run with windows open and conservation measures are not considered. This can become more of an issue when condo suites are rented. Some condo residents inevitably subsidize electricity usage for other condo residents as electricity bills consume a large and possibly increasing portion of the condo corporation’s annual budget.
In 2010 the Energy Consumer Protection Act (ECPA) was passed. This facilitated the inclusion of individual unit smart metering for measuring electricity usage in condo suites. This made it possible for individual suite owners to be responsible for paying their own electricity bills.
Today, condo corporations built prior to passing of the ECPA have three options for managing electricity bills. They can retain their bulk metering – the status quo – which means owners of condo units can continue to pay a fixed amount based on their estimated share of a building’s total electricity consumption. Alternatively, they can convert to smart metering or submetering.
Bulk Metering
A single meter is used to measure electricity usage for an entire building. This bill is apportioned among condo owners regardless of individual suite usage. Rates paid in these buildings are called General Service Rates.
Smart Meters
A condo building can work through Toronto Hydro to implement smart meters. Once implemented, each condo owner is directly billed for electricity usage by Toronto Hydro. Billing is based on time-of-use rates meaning that electricity used during off-peak times is less costly. Electricity used in common areas during peak times may be charged at a higher rate. A monthly administrative charge of about $15 is added to each bill. Meters are owned and maintained by Toronto Hydro.
Submetering
Working through a third party service, condo residents can retain bulk rates while paying for individual suite usage. This requires installation of submeters for which there is a monthly charge of about $15. Meters are owned by the condo owner who is responsible for repairs and replacement.
Proponents of smart meters and submeters claim up to 70% of residents can see a reduction in monthly electricity usage with individual suite usage dropping by an average of 22%.
Dollar savings are more difficult to determine. Each condo building is affected by the personal habits of its residents and its internal infrastructure. To financially benefit from smart meters or submetering, condo residents should realize savings in excess of the monthly fee that is charged.
