ONE CO-OP'S STRUGGLE FOR ELECTRIC SUBMETERING

Submetering is when there is an electric meter for each apartment, with each resident paying his or her own electric bill, rather than a single master meter, with the building paying — the same as most buildings do with water bills.There are roughly 400,000 apartment units in New York buildings without submeters, where people can be oblivious to wattage used. Master-metered buildings get a break on the electric rate they pay, which is about 25 percent cheaper than a directly metered rate. (Anyone who gets a bill from the utility company is billed at a direct rate.) Because there is one electric bill, though, everyone's usage is lumped together so that those who are energy hogs ride on the backs of those who conserve.

In New York State, a building can't change from being master-metered to submetered on a whim. It has to deal with the state's Public Service Commission (PSC). Charged with dual roles of providing consumer protection and promoting energy efficiency, the department has more than once been caught in the crosshairs of resident protests.

Take, for example, the controversial case of Roosevelt Landing, a rental apartment complex on Roosevelt Island. Three years ago the landlord, Urban American, applied to the PSC to submeter. Urban American won approval, and shortly thereafter, a huge brouhaha erupted. That's because the poorly insulated buildings were constructed out of cinder blocks, and the apartments were heated by electric baseboards, the windows leaked air and the non-Energy Star appliances wasted energy.

Low-income residents who were paying a couple of hundred dollars for rent were now paying a thousand dollars to light and heat their apartments. The landlord had shifted the cost of heat and electricity to the tenants, who became hostages to a building where energy conservation was well nigh impossible. The tenants organized, politicians took to their pulpits and the press had a field day. The PSC, with egg on its face, rescinded approval.

Many believe the PSC never wants to find itself at this crossroads again, and those in the know say it is tightening up its requirements so that submetering, a practically foolproof way of reducing energy consumption, is dying a slow death. And co-ops and condos, trying to conserve energy by taking this path, are finding themselves in their own personal hell.

One Co-op's Battle

Recently, one co-op that wished to be unidentified began an initiative to switch to submetering. The board obtained recommendations from its energy consultant and managing agent, and met with several vendors and chose one. The vendor submitted a contract, and the board formed a committee of lawyers to negotiate it.

But after the co-op board and its president, whom we'll call Jim, made the announcement it was seeking to submeter, a shareholder sent a letter to all the residents saying her electrician had reported that all the wires in the building were "mixed up like spaghetti," and that the building was completely cross-wired.

As contract negotiations continued, Jim made a submetering presentation at the co-op's annual meeting. "I think that a lot of people were ready to go because of my enthusiasm, and people were impressed," he said recently. "Unfortunately, contract negotiations took a year. I'm sure that it at least doubled in size — not the scope, but the number of words."

With the contract finally finished, the board began planning how to roll the project out. For the second time, Jim made a presentation at the annual meeting about submetering, including the remark that the contract had been signed but that PSC regulations made it contingent upon a successful shareholder vote.

"A shareholder stood up at the meeting and said, 'Why do we have to sign the contract before the vote?' I explained that [that point] was irrelevant because if the vote fails, there is no deal. That's when the opposition first became manifest."

Next page: Crossed wires in more ways than one >>