Electricity & sub-metering

Energy resellers

The first big scam to hit condos was energy resellers.

Companies were formed that essentially sold insurance against future increases in the cost of natural gas in the form on long-term contracts that fixed the price of gas. (these companies did not find gas fields, refine it, transport it or do anything actually. It is something like buying a five-year extended warranty on a cheap electronic gadget at Future Shop.)

Yet the administration costs are not fixed and most condo owners did not realize that many, if not all, resellers were paying commissions, finder fees, whatever they wished to call them to whoever arranged for the contract. Most often, those commissions did not go to the condo corporation.

Worse, thanks to fracking, North America became awash in natural gas so the price of gas has been constantly dropping.

Some condos are renegotiating their present contracts and are getting a lower cost for gas. Not a fair price, just a lower one. In early 2014, one board was thrilled because they got the price down to 21¢ a cubic foot while a different one got 16¢. In return, the reseller often extends length of the contract so the condo corporation is locked in at high prices for a longer period. (Enbridge presently sells gas at 11¢ a cubic foot.)

Energy resellers also sell long-term electricity contracts.

Electricity
“According to the Danish Wind Energy Association, there are more than four thousand onshore turbines—two-thirds more than Britain—in a country a fifth the size. Nowhere else has more turbines per head, and Denmark is also a global centre of wind turbine manufacturing—with Vestas, the world's leading turbine firm, based in the country.

Unfortunately, Danish electricity bills have been almost as dramatically affected as the Danish landscape. Thanks in part to the windfarm subsidies, Danes pay some of Europe's highest energy tariffson average, more than twice those in Britain.”

—Andrew Gilligan

Our new Big Thing™is energy conversation. The need is there as the building and maintaining of new clean and reliable sources of electrical generation would be expensive and the continuing use of dirty coal is irresponsible.

Yet, solar and wind power is unreliable and extremely expensive. Both depend on massive government subsidies and huge hikes in our electrical bills.

So energy conversation is an admiral goal. No issue with that. What we need to have is an honest and open debate on the best way to do this.

Electrical sub-metering
To enable smart metering and sub-metering in condominiums, two Ontario Regulations were made under the Electricity Act, 1998 and the Ontario Energy Board Act and came into force on 31 December 2007.

They are:
1.
Installation of Smart Meters and Smart Sub-Metering Systems in Condominiums; and
2.
Licensing Sub-Metering Activities

Companies that provide condominiums with smart meters, smart sub-meters, and any associated services need to be licensed by the Ontario Energy Board and the board has the authority to set criteria or requirements for the metering technology.

Public consultations
These regulations were a product of extensive public consultations in 2006 and early 2007 which included posting of draft regulations on the Internet for public comment and receiving significant feedback from a wide range of stakeholders.
(The condo owners who were consulted about changes to the new Condo Act understand how little their opinions mattered compared to the industry lobby groups.)

Owners stripped of democratic rights
So if a condominium’s board of directors wants sub-metering, the new regulation allows the installation of smart meters and smart sub-meters in condominiums without requiring an amendment to the condominium’s declaration so the owners' approval is not required. (The owners may not even be told until after the contract has been signed.)

In other words, the condo board, or a court-appointed administrator can shove sub-metering down the owners' throats and in many condos this has been done.

Why sub-metering?
The theory is that if individual condo units pay for their own usage, less electricity will be used (wasted) so there will be less strain on the electrical grid and Ontario can shutdown the coal burning power stations. The province and municipalities saves money and we all help save the environment.

Condo boards and management tell the owners that they will no longer unfairly subsidize the electrical hogs that use up far too much electricity. (In reality, aside from over-crowded units) only 10% of condo owners waste electricity.)

The real reasons the condo boards want sub-metering is:
1.
The condo is in bad financial shape and sub-metering downloads the cost of much of its electrical costs to the individual units.
2.
The corporation has over-crowded units that consume far too much in electricity, water and waste disposal costs but instead of dealing with
the real problem, the over-crowding, it is easier to download the
electrical bills.
3.
Downloading the electrical costs makes the condo fees look lower. This is suppose to help maintain property values.
4.
There are long-term contracts involved. There may be opportunities for undisclosed commissions or fees.

Why owners hate sub-metering?
If sub-metering was such a great thing, then the owners would be demanding that their board adopt it as soon as possible. After all, everyone is interested in saving money.

Most owners know that sub-metering has nothing to do with saving money and little to do with conservation. Some owners suspect that somebody is getting a kickback for bring it into the condo corporation.

How sub-metering works
A private company gets a 15-20 year contract to run the metering system in a condo apartment tower. If the board wants to terminate the contract before the expiry date, they must pay a hefty penalty.

The supplier installs the sub-meters. Each owner pays a setup fee ($25) plus a monthly service charge ($11–18) on top of the price of the electricity consumed.

If for any reason, a resident does not pay the monthly bill, the service provider has hefty penalties and they are quick to cut a unit off. It is real expensive to have the service restored. Complaints of poor customer service are common.

By the way, if you see an electrical extension cord running form a unit into a hallway, receptacle, that unit may have been cut off.

Green rebates


The Ontario government has direct grants or low-cost loans to condominiums who adopt energy saving programs. If your condo actually needs older lighting systems and equipment replaced, it makes sense to take advantage of these grants.

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