Submetering Summit

On Saturday, May 16 tenant leaders, legislators, state agency representatives (from the PSC, DHCR, and NYSERDA) and PULP met for nearly five hours to discuss electricity submetering issues and problems. Present at the Submetering Summit were tenant association leaders from buildings with a total of more than 25,000 tenants.

Elected officials who attended and spoke included New York State Assemblymen Micah Kellner, Brian Kavanagh, New York State senator Thomas Duane, Manhattan Borough President Scott Stringer, and New York City Council representatives Daniel Garodnik, Jessica Lappin, and David Yassky.

PULP presented an overview of submetering, and reviewed ten common "submetering myths" fostered by submetering proponents, landlords and state agencies.

The Waterside Plaza Tenants Association presented infrared photographs which illustrate the poor thermal efficiency of the windows, walls, roofs and vents in their buildings where the PSC allowed submetering of electric heat, and related the difficulties of tenants who find it hard to heat their apartments due to drafts or who must pay hundreds of dollars a month in winter to run their heat pumps to keep warm.

During the meeting, tenants from other buildings related their experience in receiving DHCR rent reductions of only $39 while their electric bills were multiples of that, and their experience in not getting action from the PSC on their complaints for more than a year.

Assembly members Kellner and Kavanagh participated as a panel discussing pending state legislation that has been introduced to address submetering issues. An online audio recording of their presentation is available.

Representatives of the PSC discussed the process for landlords to obtain PSC submetering orders and the opportunities for tenants to comment to the PSC when it considers a submetering application from a landlord. Tenants criticized the comment process, stating that the information given tenants when submetering is proposed is often incomplete or untimely, and the real impact of submetering is not known until too late, after the PSC order is issued, when the landlord's electric bills are issued.

The PSC representatives also discussed HEFPA rights and the HEFPA complaint process for handling disputes over submetered electric service when they arise after submetering is implemented. A PSC representative indicated that complaints can take a year to decide, that the PSC has only one person in its New York City office who checks meters for accuracy, and that when overcharges are discovered, they are remedied only for individual customers who complain, and not for all tenants in a building. Tenants indicated they had never been notified of their HEFPA rights and had not been aware that the PSC decides disputes over the submetered electric service.

A DHCR representative indicated that once a building is submetered, and when rents are reduced according to its schedule for rent reductions in rent stabilized housing, DHCR has no further involvement. (Thus, an overcharge of electricity is not an overcharge of rent, which is subject to treble damages under the rent regulation laws). He indicated that DHCR would never allow submetering of electric heat in rent stabilized housing. In contrast, the PSC has issued numerous orders allowing submetering of electric heat in situations involving subsidized housing projects for low and middle income households, e.g., former Mitchell-Lama projects. See PSC Order Allowed Landlord to Shift Million Dollar Electric Bill to Low Income Tenants; Submetering Slowed at Roosevelt Island.

A NYSERDA representative indicated that NYSERDA now assumes submetering saves 8% of the electricity used in a building, rather than the 18% - 26% stated in its submetering publications. (The higher figures were relied upon by DHCR when it lowered its rent reduction formula and by PSC staff in its proposal to submeter every master metered building). The representative indicated that NYSERDA provides financial assistance to landlords to enable them to submeter as part of a package of energy reduction measures in the NYSERDA "Multifamily Building Performance Program" but that its role is that of a grant maker, and it does not affect buildings submetered without NYSERDA assistance. NYSERDA does not assist tenants or tenant associations in buildings previously submetered with NYSERDA assistance who are now burdened with inefficient appliances, fixtures, controls, and leaky windows and poorly insulated walls.

Residential submetering, generally prohibited since 1951, was allowed on a case-by-case basis by the PSC for coops and condos in 1978, and for rental housing in 1979. The growth of submetering in rental housing was slow, and did not accelerate until after 2002. when DHCR changed its rules for reducing rents to make submetering more financially attractive to landlords. NYSERDA also boosted submetering with cash grants and incentives to landlords to encourage them to convert to submeters, and the PSC liberally granted landlords' applications to submeter.

Approximately 28,000 tenants now have electric service provided by their landlords. Permission has been granted for additional buildings where submetering has not yet been implemented. PSC staff, in testimony in the last Con Edison rate case, proposed to require all master-metered buildings, where electric service is included in rent and not individually metered, to convert to submetering. This would affect an additional 600,000 tenants in Con Edison territory.

For further information, see PULP's web page on submetering.