Is Sub Metering Your Water a Good Idea for Your Small Business?

Is Sub Metering Your Water a Good Idea for Your Small Business?

Smart electric meters have proven the Internet of Things (IoT) is valid, but now water meters are also getting smarter as submetering systems get installed around the country.

Submetering has been around for several decades. The concept is the basis for individual meters for electricity.

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But as water resources get more expensive, owners of apartments, condominiums, mobile home communities and other multi-tenant properties, as well as government officials are encouraging the installation of submeters.

Generally, multi-tenant properties will have a single or master meter for everyone, and the owner of the property is responsible for all of the water and sewer bill.  The owner then divides the bill by the number of units in the property and charges everyone the same amount regardless of how much water each unit has used.

The installation of a submeters does away with the communal system by installing meters behind the master meter for each individual unit on the property. Once it is in place, tenants only pay for what they use. By letting each tenant see how much water they are consuming, it encourages proactive conservation, which helps the environment as water continues to become a precious commodity.

Business owners of multi-tenant buildings such as apartments and condominiums can now offer more control to their tenants, just like their power or cable provider.

The new technology lets tenants access their water usage remotely, monitor how much water they use and make payments online. But it will cost more, because the company operating the submeters is generally a third-party entity that has nothing to do with the city.

In most states around the country, the delivery of electricity and water is highly regulated. And in these states, the submeter fee is usually a very small amount, covered by the landlord or passed on to the tenant. But there are unregulated states that allow companies to increase rates without much control, Ohio being one of them.

A report by Dan Gearino in The Columbus Dispatch highlights what this deregulation has done for tenants with submeters in place. The title of the article, “Submeter water bills irk condo residents” says it all. Several submeter companies are charging up to four times the fees of other providers with best practices in place.

Quoting John Ivanic, a Columbus City Council spokesman, “There is little that the city government can do because this is a ‘private-property issue’ best addressed by state legislators. We sell the water to these companies and these groups, and that’s really the end of our metering of this water.”

However, this is not the norm, and suppliers of submetering equipment and services across the country are quickly distancing themselves from the companies in Ohio that carry out this practice.

Since tenants don’t have a say in the provider of the submetering service, the burden of choosing the company that has best practices in place falls on the property owner. For property owners, the selection of a good service provider can be a used as a differentiator and  a marketing tool for attracting prospective tenants.

The cost of producing potable water is getting more expensive, and while placing submeters in multi-tenant properties will not lower this price point, it allows property owners and residents to be more responsible in how they consume water.

Meter Reader Photo via Shutterstock

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Michael Guta Michael Guta is the Assistant Editor at Small Business Trends and currently manages its East African editorial team. Michael brings with him many years of content experience in the digital ecosystem covering a wide range of industries. He holds a B.S. in Information Communication Technology, with an emphasis in Technology Management.

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  1. Some of the other benefits to property owners include lower operating expenses, increased cash flow, increased property valuation, increased revenue without increasing rent, protection against unbudgeted utility expense and rate increases, the ability to track and monitor daily meter reads online, detecting leaks in vacant units and high-usage alerts. For apartment residents submetering provides a way to help lower their total housing costs. Residents also benefit from submetering because they are responsible for their own usage rather than for misuse by others. Lastly, industry studies continue to document the linkage between utility conservation and separate billing for utility usage. A study conducted by the National Multi-Housing Council and the National Apartment Association found an 18 to 39 percent reduction in water consumption in individually metered apartments compared to apartments that include water expenses in rent. Typical installation costs range from $200-400 per unit and monthly billing fees typically range from $3.00 to $5.00 per unit. A great resource for more information on submetering is

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