Improving Returns and ESG Metrics Through Multifamily Submetering

3 minute read

What is Utility Submetering? 

Utility submetering is a system used in multifamily buildings where utility consumption (electricity, water, gas) is measured at the individual unit level through submeters. This method enables billing each resident’s actual consumption rather than distributing the total cost among all residents. The "user-pay" model motivates residents to reduce their utility usage. This leads to lower overall consumption, reduced emissions, and significant financial savings.

Submetering Drives Results

The implementation of submetering has shown to significantly impact both utility consumption and building management:

  • Financial Benefits: By reducing overall utility costs, submetering can drive improvements in Net Operating Income (NOI) and increase building valuation.
  • Cost Efficiency:Buildings benefit from a lower utility rate than if metered directly by the local utility. 
  • Consumption Reduction: Submetering encourages residents to become more energy-conscious, which can lead to a reduction in utility use by up to 40%. [1]
  • Environmental Impact: Reduced consumption contributes to the reduction of greenhouse gas (GHG) emissions, supporting improved Environmental, Social, and Governance (ESG) metrics. 

Independent Analysis: The Guidehouse Study

A study commissioned by Metergy Solutions and independently carried out by Guidehouse (formerly known as Navigant Consulting) has revealed the potential benefits of electricity submetering to be far reaching, including notable reductions in consumption and greenhouse gas (GHG) emissions. 

Based on a study of 1,500 units, Guidehouse calculated that, on average, the switch to submetering leads to a 139 kWh per unit decrease in monthly electricity usage in the first year, representing a 40% reduction. [2] This underscores the substantial environmental and financial benefits of submetering for landlords, condo owners, co-op shareholders, and property managers.

sustained reduction in consumption chart


Submetering Futureproofs Operating Expenses Against Rising Utility Costs

Submetering not only mitigates emissions but also helps control operating expenses amid rising utility costs. In addition to the greater long-term good of reducing emissions and helping stem the tide of climate change, submetering offers real, tangible benefits right here and now. In a case study, by retrofitting a 450 suite multi-family building, the building benefited from [3]:

  • NOI increase of $276k by metering electricity
  • NOI increase of $180k by metering water
  • Valuation increase of $5.5M driven by NOI improvement at a 5% Cap rate

How Can Your Building Benefit?

Submetering provides a practical approach to managing utility consumption in multifamily buildings, offering substantial benefits to both residents and property owners. By enabling precise measurement and fostering accountability, it promotes a culture of sustainability, and cost-efficiency as environmental and regulatory pressures increase.

Metergy Solutions is the #1 submetering provider in New York and stands among the top 5 in North America. With over 20 years of experience, we offer comprehensive utility management solutions across the continent. Our electricity submetering product lines from Energy Management Systems, Quadlogic, and Triacta (wholly-owned subsidiaries of Metergy Solutions) provide us with direct oversight of meter design and manufacturing. This integrated approach provides a scalable platform, driving continuous innovation in the services and solutions we provide to our clients.

Contact us or call 1-877-513-5133 to learn how you can implement submetering in your building. You can also visit us at our booth #266 at Apartmentalize to learn more!  


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[1] Savings calculated by applying Metergy analysis to Guidehouse study findings. Rental building savings calculation assumes that 40% of residents are in submetered suites. The results are based on fully penetrated buildings.

[2] Source: Electricity Consumption and the Potential Economic and Environmental Impact in Ontario, Navigant Consulting Ltd., Jan 8, 2016.

[3] Based on an internal retrofit case study by Metergy Solutions Inc.