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15.0 Utilities Strategy: metering, charging, fair use policy

15.1 Directly metered dwellings: Ofgem rules dictate that IF a tenant is directly responsible for paying the
gas and/or electricity bills, they have the right to choose their own energy supplier and the landlord
should not unreasonably prevent this. Landlords do however have a right to choose energy suppliers
where they are directly responsible for the overall gas/electricity account, yet are governed by Ofgem
regulations.

Nationwide energy usage below, comparable figures are VAT exclusive, VAT would be charged at
5%

Average electricity Gas Electric Electric Only
charge is 13.14p/Kwh
with an average Max Annual Usage per Max Annual Usage Max Annual Usage per
standing charge of property per property property

19p/day. (Kwh) (£) (Kwh) (£) (Kwh) (£)
Average electricity
charge for electric only 1 bed 10,000 £441 3,400 £542 8,000 £1,030
properties (no gas) is
11.39p/kwh. 2 bed 16,000 £706 5,200 £790 11,000 £1,388

Average gas charge is
3 bed 24,000 £1,058 7,800 £1,149 15,000 £1,867
4.2p/kwh with no daily
standing charge

15.2 All inclusive rents: If a tenant enters into an ‘all-inclusive tenancy agreement’ (rent & utilities) and there
is no separate agreement for the resale of energy, the maximum resale price rules do not apply. In this
instance you could look to the average Kwh usage and costs and factor this into an ‘all-inclusive rent’
thereby making a profit on utilities.

15.3 Promoting green credentials: We recommend that use of published baseline figures to demonstrate
just how much (a percentage) that the energy efficiency of the building benefits residents.

15.4 Fair use policy: In establishing a ‘fair use’ policy take into account that the figures in the table above are
for average homes, not necessarily modern purpose built well insulated apartments. Should you intend
to charge tenants separately for utilities the ‘fair and acceptable usage policy’ should be included within
the tenancy agreement and ‘Residents Manual’. Utility charging would be quarterly in advance and
where tenants exceed the limits or an interim meter reading indicates that the limits will be exceeded
at the end of the tenancy; the landlord would be entitled to levy a supplemental charge to obtain
reimbursement for the excess usage.

15.5 Utilities Strategy Electricity: the industry norm is to install electricity meters to each apartment.
Professional tenants expect to be in control of their electricity and to source the best deal. Currently, if
a tenant leaves without paying an electricity bill it does not fall onto the landlord to take on the debt.

Below are several different websites offering some further information:
http://www.goenergyshopping.co.uk/en-gb/tenants
http://www.rla.org.uk/landlord/guides/electricity_and_gas_charges.shtml

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