Texas Submetering Laws for Multifamily Properties
Last reviewed September 2026NES Editorial, checked by the Billing & Compliance team
As water rates climb, more Texas owners submeter. The Public Utility Commission sets the rules for design, installation, billing, and maintenance.
What are the submetering laws in Texas?
In Texas, water submetering for multifamily properties is regulated by the Public Utility Commission of Texas under 16 TAC Chapter 24, with the legal framework in the Texas Utilities Code. The rules cover system design, installation, billing, and maintenance. Owners bill residents for measured use at the utility's rate, may add only the allowed fees, and cannot mark up the utility. Compliance matters, since violations can bring penalties.
Yes. Submetering is allowed in Texas, with some restrictions.
It is regulated by the PUCT, and NES handles the requirements for you.
An overview of Texas submetering law
The Public Utility Commission of Texas is the controlling authority for water submetering, with rules in 16 TAC Chapter 24 that sit on the framework in the Texas Utilities Code. The rules cover the full process: design, installation, billing, and maintenance. Owners who submeter without a billing company need to know these rules; violations can bring penalties.
Compliant system design and installation
Texas rules set standards for how submetering systems are designed and installed, including meter accuracy. Meters have to be tested and maintained so residents are billed correctly, which is a core part of staying compliant.
Billing rules and allowed fees
Residents are billed for their measured use, and the total cannot exceed what the utility charges the property. Texas allows specific fees, such as a billing fee, but does not allow a markup on the utility itself. Bills must be clear and itemized, and disputes follow the Commission's process.
Texas state rules
- Water and sewer submetering falls under the PUCT, in 16 TAC Chapter 24 (Subchapter I)
- Owners must register with the PUCT before billing residents for water and sewer; electric billing currently requires no PUCT registration, and gas billing requires none
- Every submeter must be tested for accuracy before service, and all units must use the same unit of measure
- PUCT rules set how charges are calculated and what each resident's bill has to show
- RUBS (allocated) billing for water and electricity must use PUC approved formulas
- Owners may add a surcharge of up to 9 percent on submetered water and sewer charges, and late fees are capped at 5 percent
- No administrative fee is allowed on electric billing; on gas, an administrative fee of up to $3.00 is allowed on submetered gas only and must be disclosed in the lease
- Water and wastewater submetering rules moved from the TCEQ (30 TAC Chapter 291) to the PUCT in 2014. Electricity submetering has its own PUCT rules.
- Plus other PUCT requirements that can apply, which NES tracks as they change
Local rules can vary by city and county, and some cities set their own requirements, which NES verifies for your exact address.
General information only, not legal advice. Confirm current rules with the PUCT or a qualified attorney.
Texas submetering law
Stay compliant in Texas.
NES installs the meters, bills your residents, and tracks the Texas rules so your property stays clean. Send your details for a free, no-obligation estimate.