Submetering has become a pivotal solution for efficient utility management, providing transparency, accuracy, and cost savings in various settings. In this blog, we will explore the fundamental concepts of submetering, its functionalities, and the benefits it brings to property owners, tenants, and the environment.

Whether you're a property owner seeking fair billing practices, a tenant looking for accurate utility charges, or simply curious about this innovative technology, this blog will provide a concise yet comprehensive understanding of submetering.

What is Submetering?

Submetering can be defined as installing individual meters to measure the consumption of specific utilities, such as electricity, water, gas, or thermal energy, within distinct subunits or areas of a larger property. Unlike traditional master metering, where a single meter measures the aggregate consumption for an entire building or complex, submetering allows for the measurement and tracking of individual usage.

Differentiating Submetering from Master Metering and Other Billing Methods

Submetering stands in contrast to master metering, where a single meter measures the total consumption for an entire building or property. While master metering simplifies the billing process, it often leads to inequities and an inability to allocate costs among individual tenants or units accurately. On the other hand, submetering enables precise measurement and billing at the individual unit level, ensuring that tenants are only responsible for their actual usage.

In addition to master metering, other utility billing methods, such as ratio utility billing systems (RUBS) or flat-rate billing, are common alternatives. RUBS involves allocating the utility costs based on predetermined formulas, such as the number of occupants or square footage, which may not accurately reflect actual usage. On the other hand, flat-rate billing charges a fixed amount per unit, regardless of consumption. Submetering offers advantages over these methods by directly measuring use, ensuring fairness and accuracy in billing, and abiding by state and country regulations.

State and country regulations

In the United States, state and municipal governments have been implementing stricter energy requirements that significantly impact the submetering practices of commercial and residential properties. An example is New York City's Local Law 88, which mandates the installation of submeters by January 1st, 2025, for any building over 50,000 square feet and for tenants leasing more than 10,000 square feet of space. This law aims to enhance transparency and accountability in utility consumption, ensuring fair and accurate billing for individual tenants.

In Europe, the European Union has been actively promoting the deployment of smart grids and smart meters to improve energy network management and facilitate more efficient consumption. To evaluate the progress of intelligent metering deployment in EU Member States, the European Commission has published a document called "Benchmarking smart metering deployment in the EU-27 with a focus on electricity." According to the Commission, submetering has the potential to achieve significant savings of between 15% and 30% in energy usage, associated costs, and CO2 emissions. These findings highlight the substantial impact that submetering can have on enhancing energy efficiency and promoting sustainability across the European Union.

Key Components and Infrastructure in Submetering Systems

Submetering systems comprise several key components and infrastructure elements that enable accurate measurement, data collection, and billing processes. The primary components include:

Submeters: These individual meters are installed at the subunit or individual tenant level to measure utility consumption accurately. Submeters are typically specific to the type of utility being measured, such as electric submeters, water meters, gas meters, or thermal energy meters.

Data Collection and Communication: Submetering systems may rely on data collection devices, such as data loggers or transmitters, which gather consumption data from the submeters. This data is then transmitted to a central monitoring system or a cloud-based platform for further analysis and billing.

Monitoring and Management Software: Specialized software processes and analyzes the consumption data collected from submeters. This software enables property owners or managers to track usage patterns, generate accurate bills, and provide tenant consumption reports.
Metering Infrastructure: The metering infrastructure consists of the physical infrastructure required for submeter installation, such as wiring, network connectivity, and other supporting components.

The image above depicts a hypothetical submetering diagram and flow, showcasing the essential components involved in a submetering system. The diagram includes meters, submeters, a gateway for seamless data transfer installed on a smart building use-case, and a network server as a standard communication protocol integrated with a cloud platform.

Benefits of Submetering

Submetering offers a range of advantages for property owners, tenants, and the environment. We will explore these benefits, focusing on how submetering promotes energy and water conservation and the potential cost savings and return on investment associated with its implementation.

Accurate Measurement: Submetering enables individualized energy and water consumption measurement, allowing tenants and property owners to understand their usage patterns. This awareness often leads to more conscious consumption habits, reducing energy and water waste.

Leak Detection and Early Intervention: Submeters can identify abnormalities in consumption patterns, helping to detect leaks or inefficiencies promptly. Early intervention and repairs can prevent significant water and energy losses, leading to conservation and cost savings.

Fair and Accurate Billing: Submetering ensures fair and accurate utility billing based on individual consumption. This eliminates discrepancies caused by shared metering systems or arbitrary allocation methods, promoting equity among tenants and reducing disputes over utility charges.

Value-Added Amenity: Submetering can be positioned as a desirable feature for potential tenants or buyers. Energy-conscious individuals or businesses may choose properties with submetering systems, recognizing the cost-saving benefits and sustainable practices associated with such buildings.

Use cases

Submetering finds its relevance and application in various settings, including residential, commercial, and industrial buildings. This section will explore the different environments where submetering is commonly implemented, such as condominiums, apartment complexes, co-living spaces, and shopping centers.

Residential Buildings

Condominiums: Submetering in condominiums allows for the fair allocation of utility costs among individual unit owners. It promotes transparency and accurate billing based on actual consumption, eliminating disputes and ensuring equitable distribution of expenses.

Apartment Complexes: Submetering in apartment complexes provides tenants with a direct understanding of their utility usage and associated costs. This transparency encourages responsible consumption and reduces the complex's energy and water waste.

Co-living Spaces: Submetering is particularly relevant in co-living spaces where multiple individuals share utilities. Submetering enables fair and accurate billing by measuring individual consumption, encouraging responsible usage, and ensuring each resident pays for their consumption.

Commercial Buildings

Office Spaces: Submetering in office buildings allows for accurate measurement and allocation of utility costs among tenants or departments. This transparency promotes cost control and incentivizes energy-saving practices, improving overall operational efficiency and reducing environmental impact.

Shopping Centers: Submetering in shopping centers enables the allocation of utility costs to individual tenants based on their actual consumption. This approach ensures fairness and encourages tenants to adopt energy-efficient practices, benefiting both the tenants and the shopping center's overall sustainability goals.

Leveraging Submetering and an IoT Platform for Smart Grid Optimization

With the increasing focus on energy efficiency and sustainability, governments worldwide are implementing stricter requirements and promoting the deployment of smart grids and smart meters. These initiatives aim to improve energy network management and enable more efficient consumption. Submetering plays a crucial role in achieving these goals, with the potential for significant savings in energy usage, costs, and CO2 emissions.

An IoT platform such as TagoIO can streamline the process and maximize the benefits of submetering. TagoIO's cloud platform offers seamless data storage, real-time monitoring, and remote access to consumption information, empowering property owners and managers to make informed decisions about resource management.