Submetering Definition
Last reviewed September 2026NES Editorial, checked by the Billing & Compliance team
Submetering is the practice of measuring and billing each unit's utility use separately, underneath a property's single master meter.
What is the definition of submetering?
Submetering is the practice of installing individual meters on the units of a multifamily property to measure and bill each unit's utility use separately, beneath the property's single master meter from the utility. It applies to water and sewer, gas, and electric. Rather than the owner absorbing or evenly splitting one bill, each resident pays for what they actually consume. Submetering has been used since the 1920s, and modern meters read wirelessly and report daily. The practice lowers consumption, recovers cost for the owner, and allocates utility expense fairly among residents.
Submetering in plain terms
The utility measures the whole property with a master meter. A submeter measures one unit underneath it. Billing each unit by its submeter ties cost to actual use, which is fairer and lowers consumption.
What can be submetered
- Water and sewer, the most common
- Natural gas
- Electric
- Common-area use, measured and handled separately
Related questions
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