WASHINGTON — A two-year study of water billing practices in the multifamily residential sector has found that the practice of installing individual water meters on multi-family apartment units and billing based on actual consumption results in water savings of 15% or 8,000 gallons per unit per year.

The study discovered that billing apartment dwellers based on allocation methods ( commonly known as " RUBS" or Ratio Utility Billing Systems) did not result in any water savings.

The National Multiple Family Submetering and Allocation Billing Program Study reports on water savings and administrative issues associated with submetering and allocation billing programs in multi-family dwellings. The study was motivated by the water industry's interest in capturing potential water savings by multi-family residents where there is currently no pricing signal to encourage efficient use.

The study's sponsors noted that previously only a few studies on the subject with relatively small sample sizes had been conducted. Project funding partners included the U.S. Environmental Protection Agency, two national apartment associations and 10 water utilities.

The study found that the significant water savings resulting from submetering means that submetering should be fostered by public water conservation policies, together with appropriate measures to protect the consumer.

No water savings were found through allocated billing programs. In allocation programs water fees are based upon such parameters as the number of people, the number of bedrooms, or unit area.

Installation of water-efficient fixtures will save approximately 11,000 gallons per year per dwelling unit, according to the study. The sponsors recommended that initiation of any separate billing system should be coupled with complete plumbing fixture upgrades within a specified time.

The study's five main objectives included:

  1. determining the water savings potential in the multi-family sector resulting from both direct metering and allocation programs,
  2. understanding the current regulatory framework governing billing conversion programs across the U.S.,
  3. accessing the current business practices in the billing conversion industry,
  4. drawing conclusions from the findings, and
  5. making recommendations that offer consumer protection and capture costeffective water savings.

There is little or no regulatory oversight governing third-party billing practices, the study noted.

Among the study recommendations were the adoption of policies targeted at the mostly unregulated third-party billing industry to protect multi-family residents, including recommending:

  • The property owner should pay for billing service charges.
  • Water conserving fixtures should be installed and leaky toilet tanks repaired before billing conversion programsare implemented.
  • Improved billing format should be used that provides tenants with itemized breakdown of charges and a comparison to the water (and sewer) rates of the local utility.

It is estimated that 60 million people or about a quarter of the population in the U.S. live in multi-family dwellings. In the past 10 years, the billing of the water and sewer directly to tenants by billing entities has increased at the rate of about 25% per year. In 1988, there were only two companies involved in third party billing. Today there are around 50 to 60 billing companies nationwide billing around 15% of all multi-family dwelling units directly for water and sewer.

The study was conducted by Aquacraft Inc. of Boulder, Colo., the National Research Center, and Potomac Resources.

An electronic version of the final report is available for free download from Aquacraft at: http://www.aquacraft.com.