This post was originally published by the Department of Housing and Urban Development.

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.