I've read quite a few posts about sub-metering water and power for a large home that was converted to multiple units. However, I feel like I may be misunderstanding how it works. I've contacted a local electrician and the power company to ask about sub-metering for power, and neither of them seemed to know what I was talking about.
I'll explain how I picture it working, based on my understanding. Please correct me if I'm off base:
Property Description - Large house converted to three units (A, B, & C), with a common laundry room. The set up currently has only two electric meters and two water meters.
- Unit A has its own meters and its own breaker panel.
- Unit B, C, and the common area are on a single meter for water and one for power, with a single breaker panel.
My Understanding of Sub-metering Power - An electrician should be able to install sub-meters to measure the separate power usage from Unit B, Unit C, and the common area. I would pay the full power bill from the electric company, and then bill Tenant B and Tenant, based on their individual consumption. I would cover the common area.
Is this how it works? If so, where do the sub-meters fit into the system?
- Breaker Box --> Sub Meters --> Actual Meter?
- Breaker Box --> Actual Meter --> Sub Meters?
My Understanding of Sub-metering for Water - Similar to the power solution. I understand that the city water utility (or a plumber) would install meters to measure the water usage individually for each unit. If it's too cumbersome, I may just cover water and raise rents slightly.
This seems like a relatively simple solution, but I've gotten nowhere with the local electrician or the power company. I haven't reached out for the water yet. If you've used this solution, please advise.
- Who did you call to set it up?
- What does the set up look like?
- How do you read the sub-meters and translate that to a bill for your tenants?
- What sort of cost should I expect for adding sub-meters?
Thanks in advance!
Sub metering would involve, I'm pretty sure, rewiring the property so all the electricity for unit X is through one breaker box, and unit Y is through another, and then having meter's installed for each. I would just put all utilities in my name and raise rents. The problem with having tenants pay water is if they don't, that becomes a part of your tax bill.
@Ray Harrell Thanks for the reply. I believe what you're describing is just the process of adding another meter to the property. As I've heard it described, sub-metering can get as specialized as metering the consumption of a single appliance. That's not what I'm trying to do in this case, but I believe it's possible to continue to use the main meter, but track consumption more specifically.
There are a number of issues involved.
I'm in NYC, and if the property had two electrical meters in it, it usually means it was originally built as two and a CO issued for two. The electric utility will not give you another meter, so you'll have to install sub meters after the main meter.
The second issue is the wiring. Where I am, usually unit 2 is above unit 1, and if there're under 1 meter, it's possible you have the same electrical line running for unit 1 and continuing upstairs to unit 2. The separate them, you have to disconnect it, and run new circuits directly to the submeter.
I owned triplexes and had the house rewired, just new wiring replacing wires over 50 years old, and 3 new meters. Simple job, it was done, I'm happy, then 2 years later, I had a call from my tenant that I have circuits for some other unit hooked up to his meter. He was on vacation, shut everything off, and still got substantial usage. Had the utility come and check, and sure enough a wire was hooked on to the wrong meter. To keep him happy, paid him what was estimated he paid extra for the wrong wiring. As to the other tenant, says how is he supposed to know how much he saved because my wiring is screwed up? It's my fault. What a mess. What I'm saying that separating wiring can be messy.
For water, I agree that having tenants pay direct is a mistake as I done that, the tenant didn't pay, I got charged to my taxes including penalties.