Is it Worth it to Install a Sub Meter? A Landlord’s Guide

One of the biggest headaches for landlords is finding an equitable way to deal with utility costs. Whether you need to ensure everyone is paying their fair share and no more, or you just want to find out exactly where the most gas, water, and electricity is getting used, a submeter is the way to find out. But what is a submeter, and how much does it cost to install?

What is a submeter?

You can get a submeter from FlowRite Metering to monitor any utility, but they are most common with electrical meters. The submeter is installed past the main meter, and the submeter monitors all usage past that point, identifying how much goes where and allowing the utility company to bill separately.

Where to use it

Traditionally, properties have one master meter for each building, but that creates a hassle if you have multiple families living in the building or have divided it into units. To fix this issue and find out what everyone is using, you can install a submeter on both residential and commercial properties. You can also use it to measure electricity, gas, or water consumption. So what are some reasons to get one?

It makes things fair (and people happy)

Everyone wants assurance they’re only paying for what they use. With a submeter, you can make sure that happens. Tenants no longer have to worry that they’re paying for someone else’s usage, and those who previously had “utilities included” can pay less in rent and stay in control of their own utility costs.

It makes for peace

Suppose you have tenants in one unit who work from home and run their air conditioning, lights, and computers all day; another set of tenants head out to work early and they don’t get back until late. With a submeter in place, you don’t have to worry the second set of tenants are secretly (or maybe not so secretly) seething over the worry that they’re paying more than their fair share of the total bill.

It saves money (and the environment)

When everyone’s sharing costs, it’s easy to underestimate how much you’re actually using. With a submeter, everyone can see what their actual costs are, which almost always inspires people to start cutting back on their use.

It’s often expected

About 90% of all new construction for letting properties includes submeters from the beginning. Modern tenants are used to the idea that they’ll be able to see a clear, impartial breakdown of precisely what they’re using. If you don’t have a submeter, it might turn away some of the fiscally responsible tenants you actually want.

How much will it cost to install a submeter?

Costs always depend on the size of the property and the number of units it has. It also depends on whether you want to do submetering on all your utilities or just certain ones. Costs also vary by geographic location and the demands of the power company.

You can find several useful website tools where you can get general estimates on costs in your area, but you likely can expect to pay somewhere between $500 and $2000 per submeter, depending on type, location, and where you live.

Is it worth it?

Is the initial investment in the submeters really worth it, or are your tenants the only ones who will benefit? Actually, submeters have a high return on investment; even more than most energy-saving devices. You can expect to make back your investment in less than three years as your tenants spend an average of 15% to 30% less on energy.

More importantly, you will gain back all that time you spend every month trying to work out who owes what based on square footage, printing out your own bills, and trying to collect on time.


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