Sub-meter confusion leaves tenants in dark

June 15, 2010

Noor Javed

{{GA_Article.Images.Alttext$}}Melanie Gogan, of 90 Eastdale Tenants’ Association, says residents received notices their hydro would be cut off if they didn’t reconsent to sub-metering.

After sitting in the dark in her two-bedroom apartment for more than 24 hours, Laurie Brown finally gave in. The mother of two small children says she had no choice but to pay $500 in hydro bills or risk being without power for days, possibly weeks.

Now the Toronto resident is wondering what she will do next month when another bill from third-party energy provider Stratacon shows up again at her door.

The monthly hydro bill at her 100 Sprucewood Court apartment, previously about $40 to $60 a month, had suddenly shot up to nearly $150 a month and she didn’t understand why. She still doesn’t.

“I was told by everyone not to pay, because the bills are illegal,” she said. “But then I ended up in this position where it looks like I am irresponsible,” she said. “It’s hard to know what to do.”

Tens of thousands of Toronto tenants are still experiencing mass confusion over so-called smart sub-meters in individual apartments in the face of an ongoing dispute over who should pay for hydro costs while the province enacts legislation.

In an attempt to clear up the long-standing issue, the Ontario Energy Board, the province’s energy regulator, ruled last August that any sub-meters installed in apartments on or after Nov. 3, 2005 and up until its decision were unauthorized and “any resulting changes to financial arrangements respecting the payment of electricity charges by tenants to be unenforceable.”

In future, the OEB ruled, any use of smart sub-metering systems is only permissible with the express written consent of the tenants.

Yet landlords continue to argue tenants who signed consent forms prior to the ruling need to pay the costs, while tenants argue the OEB ruling makes their contract null and void. Some tenants say they were never given proper information when they first agreed to pay for their hydro. Others say they are still not given information to make an informed decision; still others are being back-billed for past month’s bills or pressured by their landlords to consent.

In the past week, the Federation of Metro Tenants’ Associations has received more than 60 calls from tenants claiming Stratacon threatened to shut off their hydro, said Geordie Dent, who runs the federation’s tenant hotline.

Residents in one building, at 90 Eastdale Ave., received a disconnection warning notice from Stratacon two weeks ago for failing to pay outstanding bills they say were never received.

“When I moved in three years ago, I had no choice but to sign a paper that said I would pay for my hydro,” said Melanie Gogan, head of the local tenants’ association. “But after the August OEB ruling, I never got a bill from Stratacon.”

“Then all of a sudden . . . we got a disconnection notice within 48 hours, and a threat of having to pay for all the previous months of hydro, if we didn’t reconsent to the sub-metering,” she said. “It feels like a lot of bullying.”

Once the OEB was notified, Stratacon issued an apology notice to residents.

John McDonald, president and CEO of the Consumers’ Water Heater Income Fund — which owns Stratacon — admits the situation has been confusing for all parties.

“When the ruling came out, we were given advice that at this point, you probably shouldn’t bill for the hydro, so they weren’t billed,” said McDonald. He acknowledged many buildings are currently going through renewal of hydro contracts.

Stratacon says it supports the idea that tenants have all information to make an informed decision. In some instances however, that hasn’t been the case. The OEB said tenants must be provided with an energy audit of the apartment, the administrative charge on bills, and specific amount of rent reduction and how it was calculated.

Brown says she wasn’t given accurate information when she moved into the building in April 2008. At the time, she signed a lease agreeing to pay her hydro after being told it would cost about $40 a month; the alternative was a higher rent of $75 per month.

She signed a reconsent form in November 2009, three months after the OEB ruling, but says she wasn’t given details of her hydro costs. She was recently surprised to see hydro bills of up to $150 a month, even though her appliances are new and she doesn’t have a washer, dryer or dishwasher. She stopped paying the bills, but when Stratacon cut off her power on June 3, she paid up.

Many are hoping provincial legislation due out in January will bring clarity to the issue. In the meantime, advocates and tenants say the OEB should enforce the current ruling. Landlords and sub-metering companies could face penalties of between $1,000 and $20,000 per day if found in violation.

An OEB spokesperson said the agency always advises the consumer “to pay their bill, and then resolve any disputes afterwards.”

That is exactly the outcome Stratacon is hoping for, says Gogan, of the tenants’ association at 90 Eastdale Ave. “Once you put people in such a vulnerable situation, they have no choice but to pay. If you twist their arm far enough, of course they will consent.”

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