By Ciaran Gallagher, Ph.D., Energy & Air Manager, and Tom Agger, Clean Buildings Manager
TAKE ACTION:
Picture this: a 70-unit affordable housing building with rooftop solar, energy-saving appliances and a highly efficient heating and cooling system. The only thing keeping this dream from becoming a reality in downtown La Crosse is an antiquated rule requiring apartment buildings to have individual electric meters, which measure electricity usage and are used by a utility for billing, for each unit.
Couleecap Inc., a non-profit partnering with a building developer on the project, wants to install a single meter for the entire building. This would significantly decrease project costs and unlock grant funding from Wisconsin’s Solar for All program to install the rooftop solar array.
The Public Service Commission (PSC), which regulates public utilities, has the authority to waive the individual metering requirement, but they haven’t been doing so in recent cases. Thankfully, the PSC is considering changes to this rule and are seeking public comment to solicit feedback.
Why this rule exists, and why we no longer need it
The law in question is PSC code 113.0803, which requires a separate electric meter for each unit of a new or remodeled building. The goals of this rule are twofold: 1) to promote energy conservation, and 2) to prevent disconnections to any units besides the one that fails to pay.
This rule was developed in the early 2000s when homes were often heated using highly inefficient electric resistance heating systems. Therefore, to try to conserve energy, lawmakers hoped to change consumer decision-making by ensuring tenants of apartment buildings could see their energy use through an individual electricity bill. Now, with newer and highly efficient technology like heat pumps and the ability to offset electricity demand with rooftop solar, this concern is eased.
Many utilities focus on their concerns that tenants will be taken advantage of by developers and landlords and will be susceptible to utility shutoffs without this rule. However, it is fairly common for gas furnaces and gas water heaters to be billed on one meter for an apartment building and paid for by the landlord. Property owners in Wisconsin almost never fail to pay their utility bills, leaving an entire apartment building to lose access to that service. Furthermore, utilities have falsely claimed that residents without individual meters wouldn’t have access to energy assistance benefits. The Wisconsin Home Energy Assistance Program (WHEAP) clearly states that tenants whose heat or electricity is included in rent are still eligible for assistance.
In contrast, the physical materials and technology required to install an individual meter in all units of a multi-family building drives up the cost of construction, in one case by $3 million! This increased upfront cost results in higher rent prices and can sometimes lead to projects not being built at all. Additionally, the fixed costs associated with each meter results in higher energy costs, sometimes an increase of nearly $200 annually. Higher rent and electricity is not protective of consumers.
How can a project get a waiver from this rule?
There is a mechanism to apply for a waiver from the Public Service Commission. To be granted a waiver, the project must (1) have electric equipment more efficient than required by codes and (2) have minimal overall electric use under tenant control. One issue with this language is that there is no guidance to developers on what “more efficient than required by codes” means.
Explicitly calling out buildings that are electrically heating – despite the fact that heat pumps can be more than twice as efficient as the most efficient gas furnaces and twice as efficient as electric resistance heating – is a barrier to electrifying buildings. The phrasing supports developments where either residents don’t get to control the temperature of their apartment or can’t get access to technologies that save money on electricity bills and increase comfort.
This rule, and the Commissioners’ application of the rule, is dampening the ability to build apartment buildings that incorporate sustainability and affordability, and address the housing shortage. It is also putting the Solar for All program implementation in jeopardy, a program specifically designed to increase access of rooftop solar for low-income Wisconsinites. Case in point is the Couleecap project, which weaves all three of those lofty goals into one 70-unit affordable housing building.
What’s next?
Thankfully, this outdated and misguided rule is being updated by the Public Service Commission. Proposed rule language from Commission staff was just published and is open for comment, due March 24.
While the proposed rule language is a step in the right direction, the more logical approach would be to get rid of this outdated rule entirely, for several reasons. There are not the same meter and billing requirements for water and gas utilities in apartment buildings in Wisconsin, and many states, including our neighbors Minnesota and Michigan, do not have similar electric metering requirements either. It is time to simply remove this barrier to innovative housing projects and deployment of emerging energy-saving technologies.
Rulemaking is the best opportunity for a more permanent solution as the case-by-case waiver evaluation process at the Public Service Commission is slowing down projects and wasting staff time. While these issues are being addressed through the rulemaking process, the Commission should use the authority granted to them by the legislature to waive the individual metering requirements for projects that clearly achieve Commission goals of energy efficiency, energy affordability, and sustainability. In the meantime, Clean Wisconsin will continue to comment in support of individual metering waiver requests that are submitted to the PSC. We will also continue to notify members about opportunities to comment on these waivers through action alerts.
