The Money Behind the Walls
A utility worker showed up to shut off power I didn't know I was using.
A utility worker showed up at one of my properties last month to shut off the power.
I happened to be on-site that day. Lucky. I walked over, told him I was on autopay. He said, “Yeah, you are. But the meter I’m here to shut off isn’t on either of those two accounts.”
The building had three meters. The takeover audit said two. My own confirmation from the utility said two. There was a third account, with twenty months of usage on it, that nobody in my org or theirs had ever connected to me.
The bill was $19,000. They wanted it in thirty days. I negotiated to twenty-five months.
Here is the part I keep coming back to. When I took the property over, I saw lower utility costs than the prior owner. I took the credit. I told myself my efficiency initiatives were already working. That was the story I was running on every monthly P&L.
The real reason was that one of my meters wasn’t billing me at all. I was reading my own competence into a clerical error on the utility’s end.
Now look at the macro picture under that. US power infrastructure is fifty to seventy years old. Utility rates were supposed to escalate three percent a year. They’ve actually averaged five percent over the past five years, and some metros saw nineteen percent in a single year. The grid is getting older, the bills are getting bigger, and the meters running through it were installed by people who left those jobs years ago.
This is the part nobody underwrites. Not the assumption that rates rise. The assumption that the meters on your building are the meters you’re being billed for, and that the bills you’re being billed for reflect what your building actually used.
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Here is the small piece you can act on this month. Pull every utility account number for every property you operate. Walk the building. Count the meters. Compare. If the count matches and every account ties to a unit, you have what you need. If something doesn’t tie out, you just found work to do before the utility finds it for you.
The flip side of the same coin is real money. Con Edison’s updated multifamily efficiency program is paying up to $2,000 per dwelling unit, with project caps up to $1M for affordable buildings electrifying off oil. That money only moves to owners who understand what their systems actually do. The owners getting billed for invisible meters aren’t the ones cashing those checks.
The buildings aren’t lying to anyone. The information is sitting there. Somebody just has to go look.
Next week I want to tell you about the building you’re about to buy that’s hiding the other kind of missing meter — the one that’s already on the books but isn’t on the report.
—Jon
P.S. If you want the framework for spotting the gap between what a building says it costs to run and what it actually costs, the new lead magnet I just put out — "Two Identical Buildings on the Same Street" — walks through it. It's the door to The Money Behind the Walls, which goes live this week.