‘Submeter’ regulation needed, critics say

Ohio legislators are working toward regulating companies that resell utilities in apartments and condominiums, but as they consider a variety of proposals, there are few signs of consensus about what, if anything, to do.

A succession of consumer advocates and residents urged the House Public Utilities Committee on Tuesday to pass a bill that would impose new rules on socalled submeter companies. Those are the unregulated businesses that sometimes charge much more than regulated utilities for services such as power and water.

Rick Colby, a leader of the Downtown Residents’ Association of Columbus, said that submeter companies are gouging consumers by exploiting a loophole in Ohio law. The companies buy electricity and water at a bulk rate and then resell it at a markup, a model that would be illegal in most states.

“They’ve driven a truck through the loophole,” Colby said.

The topic has been part of discussions in the legislature since a 2013 report in The Dispatch put a spotlight on the utility practices. Several of the people who testified on Tuesday have made similar comments in prior years about bills that never made it to the House or Senate floor for debate.

This hearing was on House Bill 249, sponsored by Rep. Mike Duffey,

R-Worthington. Sen. Kevin Bacon, R-Minerva Park, has proposed Senate Bill 157, which addresses similar concerns.

Although the issue has been around for a while, many of the committee members are new to it, said the committee chairman, Rep. Robert Cupp, R-Lima. He said he is approaching the topic with an open mind.

“If you’re asking if there’s anything preordained on this bill, the answer, at least to my knowledge, is no,” he said.

Legislators’ questions

underscored the complexity of the issue, involving rate structures, profit levels and the amount of certain utility charges.

One of the next steps is for the submeter companies and their supporters to testify; that is expected at an upcoming hearing, which has not yet been scheduled. The companies include Nationwide Energy Partners of Columbus and American Power & Light of Westerville. They have contended in the past that they provide a valuable service to property

owners and tenants.

“Rep. Duffey’s bill would actually have unintended consequence — decreasing transparency, shifting costs to the renters and impeding property owners’ rights,” said Gary Morsches, Nationwide Energy’s CEO, in an email.

He said his company supports reasonable regulations and “will continue to stand with organizations that want the same benefits for consumers.”