Passion for Electricity Submetering in Subsidized Housing Cools in Toronto

Diminishing Emphasis on Submetering
Toronto, Ontario has approximately 1,000 concrete slab apartment towers built from the late 1950s to the early 1970s. This concentration of brutalist structures is second only to the New York City area in North America. Similar to New York, with its Mitchell-Lama and HUD-funded projects, some of the Toronto buildings were constructed to provide affordable housing to lower income households, and some have electric heat. At the time the buildings were constructed, energy efficiency and insulation were not high priorities: electric heat was the cheapest to install, electric rates had been declining for decades until the early 1970’s, and there was an expectation — too optimistic as it turned out — that even cheaper electricity from new nuclear power plants was just over the horizon.

Instead, electricity prices rose over time, faster than other costs, and the buildings became saddled with high energy costs. A few years ago, the reintroduction of submetering was seen as a solution by New York landlords facing volatile and rising electricity prices as a way to stabilize their revenues by shifting the risk of increasingly volatile electricity prices to tenants. Also, in some situations, imposing additional electricity costs on subsidized low-income tenants by deeming the utility charges to be “rent” may have become a convenient way for landlords to pressure them out and re-rent the premises at market rents.

The essence of submetering is a shift from the owner to the tenant of the cost of electricity. From a policy perspective, however, giving tenants the electric bills when they neither own nor control the fundamental factors driving consumption is questionable. It diminishes incentives for owners to replace their inefficient appliances, fixtures and controls, or to improve thermal efficiency of the structure itself, for example, with added insulation. And there is no reliable evidence that shifting bills to tenants results in lower usage, even though submetering is often claimed to be justified on this basis.

The Social Housing Services Corporation, a non profit organization that provides consulting and support services to owners of subsidized housing projects in Ontario, is now recommending a more cautious approach to “suite” metering (submetering) of master metered buildings, and a more comprehensive approach to energy efficiency than simply passing the bill responsibility to tenants:

SHSC prepared a report titled Smart Meters and Social Housing: Energy conservation and energy poverty issues on the potential installation of smart meters in all social housing properties by 2010, as mandated by the provincial government. The concerns raised in the report can be summarized as follows:

  • Smart meters may be very costly to install in older social housing buildings and the cost of doing so will be borne by low income tenants and/or cash-strapped social housing providers in the form of higher monthly administrative fees
  • time-of-use(TOU) pricing penalizes seniors, disabled and poor residents who live in electrically-heated units (a significant portion of social housing units) or who must access peak-priced utilities for health reasons
  • Suggested time-of-use pricing penalizes the poor by charging peak prices for an additional hour of use in the winter than the summer. This is because social housing residents are more likely to rely on winter electric heat while Ontarians with higher incomes are more likely to have access to summer air conditioning.
  • The transfer of utility costs to tenants will have a negative impact social housing providers in terms of a) absorbing the additional administrative fees required with individual tenant billing systems compared with bulk purchasing, b) reduced marketability of some units that are electrically-heated, ground floor or northfacing, c) possible defaults by tenants on utility payments or rents and/or unsafe heating practices d) difficulties in attracting tenants due to high deposits requiredby utilities in individually-metered units
  • The recent Ontario Energy Board Smart Price Pilot Final Report does show some success in reducing monthly electricity consumption. The majority of the reduction was due to improving energy efficiency in the household and a small amount due to load-shifting to off-peak times. The average monthly savings of $4.17 are negated by the approximate $3.80 monthly fee to pay for the installation and maintenance of the meter. It is also risky to generalize from this study to the general population, as the majority of the participants were homeowners with incomes over $50,000 per year and presumably better able to afford energy-saving measures and shift their peak use.

Early smart meter installation may expose social housing providers to unintended consequences, Social Housing Services Corporation.

SHSC’s current position is that social housing can meet Ontario’s conservation targets through a strategy of energy efficient retrofits and incentives, and focused staff and tenant education programs – without the use of smart meters, time-of-use pricing, or a shift to a 100% tenant-pay model.

The Tower Renewal Project
The Mayor’s Tower Renewal Project in Toronto is now focusing on rejuvenation of its concrete slab high rise housing:

The Greater Toronto Area contains a heritage of nearly 1000 post-war concrete residential tower blocks located throughout the region. The presence of this remarkable collection of modern housing represents an architectural, planning and construction legacy unique to North America.… This inheritance of high density neighbourhoods provide significant opportunities to create a sustainable, prosperous and connected region, able to meet the challenges of the 21st Century; accommodate growth, alleviate poverty and help grow the green economy.

A comprehensive revisioning and reappreciation of the buildings, including improvement of their energy efficiency, is now underway:

[T]he City of Toronto through the Mayor’s Office is implementing the Tower Renewal Project, a building upgrade, community reinvestment and greening incentives programme, which aims to significantly improve the social, economic and environmental sustainability of the region.

Consisting of durable concrete buildings and large areas of under utilized open space, these building represent a remarkable resource. Green building and site upgrades are anticipated to reduce energy use and greenhouse gas production by over 50%, while the sites themselves can accommodate needed community services, usable open space, retail, and housing; enabling vibrant neighbourhoods and sustainable communities. * * * *

Key Goals Include:

1 – Achieving significant reductions to greenhouse gas emissions in the Toronto region through ‘green’ investment into high-rise concrete residential buildings such as the thermal over-cladding, adding energy saving and renewable features to their site such as district solar, wind and geothermal power, developing on-site waste management and urban agriculture, along with providing improved access to public transit and other alternatives to car use.

2 – Creating ‘complete communities’ within inner suburban high-rise apartment neighbourhoods with the full range of community services and amenities, opportunities for employment and entrepreneurship, and housing types and tenures, specific to the needs of residents, responsive to built and cultural heritage, integrated into the community at large, and enabling sustainable lifestyles.

3 – Further developing world-class Canadian industries dedicated to high-quality building retrofits, sustainable development, and community design.

ERA Architects, Tower Renewal Project Blog.

Perhaps one day the New York Public Service Commission and NYSERDA will stop being used by landlords to evade responsibility for inefficient premises through submetering, enlarge their horizons, and push for what Toronto has begun to do to reshape their valuable large housing project assets.

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