Smart meter retrofit in existing condos is confusing
Q: Our units are not separately metered and the declaration provides that electricity is a common expense. The board recently entered into an agreement to separately meter the units so that the cost of unit electricity will no longer be a common expense. It appears that a majority of owners are opposed. The board maintains that the smart meter installation is mandated by the government. Can the board do this without a declaration amendment or a vote of the owners? A: One might assume that this question could be answered with a simple “yes” or “no.” Unfortunate- ly, the matter is more complex. The Canadian Condominium Institute and the Association of Condominium Managers of Ontario made representations to the Government of Ontario in 2006 and 2007 in regard to proposed legislation that would require condos to install smart meters in all units by Dec. 31, 2010. The argument was made that the installation costs and monthly administration fees would exceed the anticipated savings due to reduction in the use of electricity.
The legislation, when passed, left the decision to the board of directors of each condominium.
The initial legislation was subsequently rescinded and the smart meter situation is now dealt with in the current version of the Electricity Act, 1998, and the Energy Consumer Protection Act, 2009. Regulations under the latter provide that the installation of unit meters existing at the date the act came into force requires approval of the board. The legislation does not provide that a board’s determination to install smart meters supersedes any provision in the Condominium Act. Section 97 of the act states that if the estimated costs of a common element addition, alteration or improvement will be greater in any month than 1 per cent of the annual budget, owners of 15 per cent of the units must be given the opportunity to requisition an owners’ meeting to vote on the project. If the estimated cost exceeds 10 per cent of the annual budget, the project must be approved by at least 66 and two-thirds per cent of the units. Section 97 also provides, however, that those requirements are not applicable if the addition, alteration or improvement to the common elements is required by statute. A smart meter project involves additions to the common elements as well as to the units. The question is whether, once the board decides to proceed, the installation of meters is a common element alteration required by the Energy Con- sumer Protection Act, 2009. If so, the unit owner voting provisions in Section 97 are not applicable. Some condominium boards have taken that position and have proceeded as your board has done.
A determination as to whether that position is correct may require a court decision or a legislative clarification. In the meantime, boards wishing to install smart meters should seek advice from their legal advisers as to the applicability of the Section 97 provisions relating to owner approval. Lawyer Gerry Hyman is an expert in condominium law. Send questions to gerry@gerryhyman.com or fax to his attention at 416-925-8492. Letter volume prevents individual replies.