Understanding Submetering vs RUBS: Which is Better for Your Property?

Overview of Utility Billing Methods

When it comes to managing utility costs in multifamily buildings, property owners have two primary options: RUBS (Ratio Utility Billing System) and submetering. Each method has its advantages and disadvantages. Understanding these can help you make an informed decision that benefits both you and your tenants.

TL;DR

• RUBS vs submetering comes down to estimates versus actual usage billing.

• With RUBS, tenants pay a calculated share of shared utility costs.

• Submetering charges tenants based on their actual water or energy use.

• DrizzleX provides fixture-level submetering without major plumbing changes.

  
  

What Is RUBS?

Ratio Utility Billing System (RUBS) is a method for splitting utility bills among tenants when a building relies on a single master meter. This means there’s one meter for the entire property, not individual meters for each unit. Installing separate meters isn’t always practical or affordable, which is why many property managers use RUBS.

RUBS is one of the two most common methods for billing tenants for shared utilities. It applies an industry-accepted formula based on the number of occupants, square footage, or number of bathrooms in each unit. Utility companies bill the property owner or manager first. The total cost is then divided among tenants using the RUBS formula, which helps recover utility expenses when submetering isn’t available.

RUBS can help balance shared costs in properties with different unit sizes and occupancy levels. However, it doesn’t track actual usage, and local regulations may restrict how the system can be implemented.

Advantages and Disadvantages of RUBS

RUBS is a simple and affordable option for utility billing, especially when submetering isn’t possible. But like any billing method, it has its pros and cons.

Pros of RUBS

• Works without individual meters, making it a good fit for older buildings.

• Easy to set up and doesn't require ongoing maintenance or new equipment.

• Uses unit square footage, number of occupants, or amenities to divide bills fairly.

• Helps recover utility costs even when submetering isn't an option.

• Avoids mechanical issues that can happen with meters.

  
  

Cons of RUBS

• May not reflect exact usage, which can feel unfair to some tenants.

• Some states limit or regulate RUBS, so you should check local regulations.

• Tenants with fewer people or lower usage may feel overcharged.

• Not as accurate as submetering, especially in properties with varied tenant use.

• Can discourage conservation efforts when savings aren’t reflected in bills.

  
  

RUBS can be helpful when used right, but it’s important to know your building and your tenants before choosing this method.

What Is Apartment Submetering?

Apartment submetering is a way to track how much water or energy each unit in a building uses. Instead of using one master meter for the whole building, submetering breaks it down by unit. Submetering systems measure actual consumption for each apartment, which allows tenants to be billed based on their own usage.

There are two ways this is done:

• Unit meters measure total water or energy use for a single apartment.

• Micrometers are installed at individual fixtures, such as sinks, showers, or toilets. Their readings are combined to show total unit usage.

  
  

Submetering gives property management a more precise billing system and helps tenants see how their usage affects their bills.

Advantages and Disadvantages of Apartment Submetering

Apartment submetering improves billing accuracy, but it also requires more planning and oversight.

Pros of Apartment Submetering

• Bills tenants based on their own usage rather than shared estimates.

• Gives residents more control over their utility bills.

• Encourages tenants to conserve utilities and reduce water waste.

• Shares usage data so tenants can monitor how much they use.

• Matches tenant expectations for transparency and accuracy.

• Can help lower total utility costs for the property.

  
  

Cons of Apartment Submetering

• Costs more to install and may require plumbing or wiring updates.

• Doesn’t work well in every building, especially older properties.

• Requires regular meter checks or software monitoring.

• Repairs or technical support may be needed at times.

• Can be harder to manage in small buildings or with frequent tenant turnover.

  
  

Submetering works best in properties that can manage system oversight and make decisions based on the data it produces.

Is RUBS Unfair to Tenants?

Many tenants question whether RUBS utility billing is fair. The concern usually comes from how utility costs get divided compared to a unit’s actual utility consumption. Let's look at two sample scenarios, and you can judge whether RUBS is fair or not.

Scenario 1

The Johnson family is a quiet couple in their 60s who live in a ground-floor unit. It’s just the two of them, and they’re careful with utility consumption. They take short showers, run full laundry loads, and reuse cold shower water to keep their plants alive.

Their upstairs neighbors are five college students who host parties most weekends. The dishwasher runs constantly, guests come and go, and classmates regularly use their unit to do laundry. Under RUBS, both units are billed the same amount based on square footage.

Mrs. Johnson called the management office, fuming:

“How are we using the same water and trash as the five guys upstairs? This is theft.”

Scenario 2

Marcus lives alone in a studio at the edge of the property. He keeps his energy usage low. He takes quick showers, avoids using a dishwasher, and rarely does laundry. Even so, his monthly bill stays high.

Turns out, a big chunk of it comes from shared water usage like outdoor hose bibs, lobby cleaning, and even leaks in common-area plumbing. Since the building uses RUBS, these costs get divided up based on square footage.

Marcus is fed up:

“Why am I paying for someone hosing down the courtyard or a leak in a hallway pipe? That’s not my water use, it’s just lazy billing.”

He starts questioning how much of his bill reflects his own unit’s utility usage.

Verdict

In both cases, RUBS seems pretty unfair to tenants. The Johnsons pay more because their neighbors use more. Marcus covers shared costs and leaks that sit outside his control. Tenants who try to save water or reduce energy usage see no clear link between behavior and cost.

RUBS often appeals to property managers due to lower upfront costs and minimal changes to property infrastructure. Tenant satisfaction can decline when bills don’t reflect actual utility consumption. Many residents expect accurate billing that connects usage to meter readings, not shared estimates.

Properties focused on fair tenant billing and long-term cost savings often move toward systems that charge tenants based on what they actually use.

Why Submetering Is Better Than RUBS for Property Owners

RUBS may seem easier at first, but submetering offers many more benefits to property owners and property managers. Let's discuss it below:

Submetering Recovers More Utility Costs

Many owners still include utilities in rent. According to Zego, 53% of operators follow this model, which limits how much utility expenditure owners can recover. Submetering changes that. Charging tenants based on recorded usage helps increase utility cost recovery and reduces the portion of expenses the property absorbs.

Zego estimates that this shift can improve net operating income (NOI) by 3–5%, without raising rent.

Fewer Compliance Questions

Submetering creates clear usage records that show how charges were calculated. This matters when local laws require transparency in how utility costs are allocated among tenants. Clear records also reduce back-and-forth with a utility billing company. Billing questions tend to resolve faster when usage data is available.

Boosts Property Value

Submetering can also support higher property value. Commercial property owners and investors look for evidence that utility expenses are monitored as rates increase. Installation does require a significant upfront investment and physical equipment. Many owners treat that cost as an infrastructure upgrade and recover it through steadier income and fewer billing gaps.

Get All the Benefits of Submetering With DrizzleX

Most apartment buildings in the U.S. weren’t built with submetering in mind. As a result, many property managers still rely on estimates or older methods like RUBS to allocate utility costs among tenants.

DrizzleX offers a fixture-level utility submetering system that works with existing physical infrastructure. It gives property managers utility billing solutions without opening walls or replacing plumbing.

Track Water Use at the Fixture Level

DrizzleX uses micrometers installed at toilets, showers, and sinks to record water use at each fixture. This setup shows where water runs longer than expected, where usage spikes, and where patterns don’t match tenant preferences.

The Water Consumption Insights Report uses historical data to highlight where usage changes and where repairs matter most. Property teams can focus maintenance efforts on specific units instead of checking the entire property.

How a Greenville Property Cut Water Use by 38% With DrizzleX

A multifamily property in Greenville, South Carolina, used DrizzleX to monitor toilet water use in three buildings with 54 units and 108 tenants. Before monitoring, the property averaged more than 20,000 gallons of water per day. After one year, daily usage dropped to about 12,655 gallons.

DrizzleX flagged dozens of toilet leaks, including a continuously running toilet caused by a failed flapper. Fixing these issues helped the property save an estimated $17,839, or 38% of prior water costs.

Stop Pouring Money Down the Drain, Save With DrizzleX

Leaks often stay hidden until costs climb. DrizzleX highlights unusual water flow early, which helps maintenance teams respond sooner and avoid higher repair expenses. The system works well alongside a good utility billing provider and supports regulatory compliance with clear usage records.

Property managers gain a reliable way to save money while billing tenants more accurately. Request a custom DrizzleX quote today and see how much water your property can save!

FAQs About RUBS vs Submetering

What are the disadvantages of submetering?

Submetering usually costs more to install than RUBS and may require plumbing or wiring updates, especially in older properties. Ongoing system checks or billing software may also be needed to keep water billing accurate. Some properties may need additional time to manage usage data and maintenance.

What does submetering mean?

Submetering means measuring utility usage for each unit instead of relying on a single master meter. Tenants receive bills based on their actual water or energy use rather than shared estimates.

How do you explain RUBS to tenants?

RUBS divides a building’s total utility bill using a formula based on factors like unit size or number of occupants. It doesn’t track individual usage, so tenants pay a calculated share rather than their exact consumption. RUBS is commonly used in properties without individual meters.

Is submetering worth the cost?

Submetering can be worth the cost when rising utility bills affect property cash flow. Charging tenants based on actual usage improves cost recovery and supports targeted improvements that lower ongoing expenses.