Economic Arguments for Submetering

Conservation is one of the strongest arguments for submetering individual units in a multi-family or business property. Water conservation is a key issue in all regions, not just those with water shortages. The rising cost of water production and treatment makes conservation a priority, even where water is plentiful. Submetering gives tenants the financial incentive to repair leaks, install water saving devices, and reduce overall water usage simply by not being wasteful.

Property developers and managers who invest in submetering quickly realize a positive financial impact. Submetering allows the transfer of most of the water and sewer utility charges to tenants, generally without reducing rents. The sewer utility cost based upon water usage is very often a multiple of the water cost so the cost savings can be impressive. Tenant conservation reduces a property's utility charges, improving net cash flow. Property value, for resale or refinancing, is increased significantly by the profit and cash flow improvement that submetering generates. In addition, tenants appreciate the fairness of paying for only their usage, and avoiding rent increases driven by other tenants' excessive water use.

We have customers that have recovered the costs of these meters in just 30 days, even when they did not pass the water and sewer utility costs on to the tenant. It is not unusual for water usage to drop by 75% when tenants know that their usage is being monitored and may result in a pass-through that they will have to pay for in the future. And this figure does not include energy savings from hot water generating costs or well pumping electrical charges, both of which can be substantial.

We recently supplied submeters to a residential complex in Nassau in the Bahamas. The cost of water there has recently risen to $19/1000 gallons. As an average single family residence uses 20,000 gallons per quarter for domestic use (no irrigation), it is a substantial expense. If by installing a meter for $44.95 you can cut usage by 50% you will save the cost of the meter in 30 days. Where else can you get a return like that? We have supplied these meters for apartments, high-rises, marinas, mobile home communities and municipal water communities. The results are always the same, the meters pay for themselves.

Click here for a recent WSJ article on submetering
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