The heating cost bill helps millions of households to save energy. Nevertheless meter-reading companies like ista are criticised as rip-off merchants. Why is that actually?
It’s the end of March. The ista meter reader arrives at a typical multi-family building. Built in 1960 with five floors and a total of ten apartments. In Germany, you find such buildings on every street corner. There are over three million multi-family buildings in Germany with more than 18 million tenants living in them. They all receive an ancillary cost bill once a year. This bill lists all general costs which the building residents share, e.g. for refuse collection, the lift or a concierge.
It also includes heating costs. However, the heating costs are not simply divided by the number of households, but calculated individually for each apartment. The important thing is that every tenant gets their own heating bill – the landlord is obliged by law to make sure of that. For, since the early 1980s, it has been a legal requirement for every tenant in Germany to be able to see how much heating energy they use and pay only for that. Or in other words: nobody should pay for their neighbour because there would only be disputes and nobody would care about their own consumption if they didn’t have to pay the costs alone.
And because of that, the meter reader now has to gain access to the building. He rings the concierge’s bell, but nobody opens the door. He rings the bell again and this time he is buzzed in. The concierge says, “Oh, here you are.”
Additional payment or part refund of heating costs
The meter reader is in luck. All ten tenants are at home. They include a retired couple, a mother and child and a single person who is working from home today because the meter reader is coming – a cross-section of the population. Each apartment is equipped with small white devices attached to every radiator, the heat cost allocators – and they’re exactly what the meter reader has come about. He takes the consumption readings with an electronic device. One tenant says that she got a refund on her heating costs last year and hopes she’ll get another one this year. Another says he had to make an additional payment, which annoyed him. He can’t understand why, says the meter reader. “But that’s why I’m here. We read the meters to make your energy consumption transparent and so you can see exactly what you can improve. We have nothing from it if you have to pay more.”
Ulrich Ropertz from the German Tenants’ Association thinks that’s “indecent “. In the ARD TV programme “Plusminus” he says: “If a company actually generates a return of 40% in a market by offering a relatively simple service, i.e. ‘We meter energy consumption’, that is simply indecent.”
The meter reader watched the programme. The issue of the rate of return is quite different to what many people think. A margin before tax and deduction of investments is not the same as the company’s profit. But ista’s boss can explain it better than him. However, he doesn’t think that the service offered is “simple” at all.
Is the reading of heat and hot water consumption really too expensive?
The fact is tenants pay between 50 and 100 euros a year for the complete ista package, which includes the metering devices, meter reading and individual bills. That is roughly the hourly rate charged by tradesmen in Germany. The whole discussion running under the headline “rip-off” revolves around this point.
The meter reader sighs: many people underestimate how involved the whole process of producing a final heating cost bill is. He stands on the landing in the building hallway and holds his thumb up to count. First of all, the devices have to be manufactured – that costs money, above all because they contain more and more digital technology. A smartphone is also more expensive than a landline phone. Secondly, the devices have to be installed in the apartments and subsequently serviced. That is a skilled job which somebody like him has to do – somebody who really knows what he’s doing. In Germany alone, there are over 3,000 different types of radiators. And on top of that, a large number of standards which have to be met to ensure accurate metering.
Thirdly, exact readings must be taken – either manual or digital readings. Only when all this has been done can the actual consumption of each household be determined from the bill for the entire building which the landlord gets from the energy utility. At the end of this process out comes the heating cost bill for each apartment. In many cases, it also includes an analysis of consumption. The tenant then knows exactly how his heating costs compare, for example with the previous year or also with the average consumption of his neighbours. It’s really not simple at all, says the meter reader; it involves a great deal of time and technology that you don’t see at all at first sight.
Heating cost bills help tenants reduce their heating costs
A woman in her mid-60s comes along the hallway carrying shopping bags. She asks why the meter reader comes at all anymore as nowadays you can do everything using the Internet. “You’re right,” says the meter reader. “Radio technology makes everything easier. But it’s your landlord that has to place the order. You’d best speak to him directly.”
The woman asks whether it will then be more expensive. “No”, the meter reader answers. “The digital devices are slightly more expensive but the service is then cheaper.” “You’d better negotiate well then,” the woman calls out to the concierge, who is mending a window handle halfway up the stairs. I always do that comes the reply as he climbs the stairs. His boss, the landlord, always wants him to get several quotes from different companies for anything to do with ancillary costs, including heating cost bills. After all, the lower heating costs are, the more attractive an apartment is for tenants. The last thing his boss wants is empty apartments.
The heating cost bill is actually good for tenants because people’s heating costs fall considerably. After all, individual heating cost bills mean that most tenants have better control of their consumption. So on average they cut their heat consumption by 20% a year as studies by the EU Commission have shown. With heat and hot water costing roughly 800 to 1,000 euros a year, that’s on average as much as 200 euros more that the tenants in Germany have in their pockets at the end of the year. And it is also good for the environment because less heat is used and so less climate-damaging CO2 is released into the atmosphere. The more transparent tenants’ consumption is, the more they save, as a three-year project conducted by the German Energy Agency (dena) shows.
After an hour the meter reader is finished. “What will you do if my boss wants to have radio-based devices?“ the concierge asks as he leaves. “I’ll still have plenty to do,” says the meter reader. “Installing, servicing and checking the devices to make sure everything’s working properly. But all without having to enter apartments.” “Oh, that’s a good thing,” says the concierge. “But it’s a shame we won’t see each other anymore.”