As published in the Fall 2008 edition of CondoVoice Magazine.
It has been more than an a year since the Ministry of Energy announced that sub-metering would no longer be mandatory for condominiums, but optional. One would expect that with the passage of a year, the questions that were once relevant when sub-metering was the “hot topic” would have been answered.
Some of those questions have been answered, or at least solutions have been developed to deal with them or get around them. Boards of directors and managers are becoming more knowledgeable of sub-metering, and submetering providers are becoming more knowledgeable of condominiums and boards of directors. Nevertheless, the year since the Ministry’s announcement has not answered all of the questions relating to the implementation of submetering.
Although the Electricity Act, 1998 and its regulations confirm that condominiums do not have to amend their declarations and by-laws to introduce submetering, it is not always going to be the case with every sub-metering arrangement that boards of directors can implement a sub-metering system without first obtaining unit owner approval, or providing notice to unit owners pursuant to Section 97 Condominium Act, 1998. Arrangements that, at first glance, may appear simple, may not in fact, be that simple on paper.
Apart from understanding how the submetering system works and whether or not implementation will be beneficial for a condominium, boards of directors and managers must have knowledge of the contractual arrangement proposed and its impact on the condominium for the term of the arrangement. For instance, boards of directors and managers must understand the implications of, among other things: who retains ownership of the sub-metering system (either at the outset of the arrangement, during or after the term); whether the condominium corporation is required to enter into a financing arrangement with the provider; when and how the arrangement can be terminated and the consequences of termination; what happens to delinquent accounts during and after the expiration or termination of the arrangement; and, the extent of the services and involvement of the condominium corporation.
There are also practical implications in implementing a sub-metering system that will be unique to each condominium corporation depending on its membership. For some unit owners, the implementation of sub-metering will be a welcome change, yet others may question, oppose or even challenge a board’s decision to implement submetering. Education of unit owners by holding information meetings, and providing unit owners with the opportunity to meet and ask questions of the provider is essential. Explaining the changes that will result, answering questions and informing the unit owners of the benefits for the condominium as a whole, before implementing sub-metering may go a long way for unit owner and board relations.