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Submetering frequently asked questions

December 7, 2016

What is submetering?

Submetering is the practice whereby an entity such as a landlord, condominium association, submetering company or other entity purchases utility service from a regulated public utility and resells or redistributes the services to its tenants or other customers.

What is the PUCO’s role in submetering?

The PUCO has supervisory authority over all public utilities within its jurisdiction and, among other responsibilities, has the power to prescribe any rule or order necessary to protect consumers. Submetering companies could fall under PUCO jurisdiction under certain circumstances, namely if the company fails any prong of the Shroyer Test.

What is the Shroyer Test?

The PUCO has traditionally applied the three-part Shroyer Test to determine if an entity is operating as a public utility and thus falls within the scope of the Commission’s exclusive jurisdiction. The prongs of the test are as follows:

  1. Has the landlord manifested an intent to be a public utility by availing itself of special benefits available to public utilities such as accepting a grant of a franchised territory, a certificate of public convenience and necessity, the use of eminent domain, or use of the public right of way for utility purposes?
  2. Is the utility service available to the general public rather than just to tenants?
  3. Is the provision of utility service ancillary to the landlord’s primary business?

What is the PUCO doing about submetering?

In a previous order, the Commission initiated an investigation to determine whether the Commission has jurisdiction over submetering companies along with determining the regulatory framework that should govern submetering companies.

In December 2016, the Commission issued a finding that prescribed certain parameters associated with the application of the Shroyer Test and the limited statutory authority available to it, including that:

  1. The Shroyer Test should be applied not only to landlords, but also condominium associations, submetering companies and other similarly-situated entities;
  2. If a submetering company or similar entity charges a certain percentage above default service for a similarly situated customer, then it will be presumed that the entity is acting as a public utility, thereby subject to PUCO jurisdiction;
  3. Failure of any one of the three prongs of the test is sufficient to determine that an entity is unlawfully operating as a public utility.

The PUCO seeks additional comments on the percentage to be used in the second finding above. Stakeholders should submit comments by Jan. 13, 2017, and reply comments by Feb. 3, 2017. 

Where can I learn more?

For information regarding the case (15-1594-AU-COI), visit the case docket to learn more about the proceedings.

What can I do?

If you have utility-related questions or would like to file a complaint, call the PUCO Call Center at (800) 686-7826 (PUCO) or visit www.PUCO.ohio.gov.